Cheniere Energy Partners has announced that its subsidiary Sabine Pass Liquefaction has entered into its first LNG sale and purchase agreement with BG Gulf Coast LNG.
The deal is for the purchase of 3.5 million tonnes per annum (mtpa) of liquefied natural gas (LNG) over a 20-year period from the Sabine Pass LNG terminal located in Louisiana.
The deal marks the first long-term LNG purchase agreement from a project on the US Gulf Coast. It will enable BG Group to secure LNG volumes for export from the US to international gas markets, with exports expected to commence as early as 2015.
Construction of the liquefaction facilities at Sabine Pass is expected to commence in 2012, with the initial phase to consist of two trains capable of producing up to nine mtpa of LNG.
Charif Souki, chairman and CEO of Cheniere Energy Partners, said:"BG is one of the largest participants in the global LNG markets and will be a strong foundation customer for our Sabine Pass liquefaction project. Entering into this agreement is a significant milestone for our project and we look forward to finalizing additional commercial agreements and proceeding with the development of the first two trains."
BG Group chief executive Sir Frank Chapman said: “This is a ground-breaking agreement for BG Group, giving us first-mover advantage in securing LNG export volumes from the US Gulf Coast. It is the first agreement of its kind in this region and it secures us early access to the rapidly emerging commercial opportunities driven by the recent material increases in US gas reserves.
“We are delighted to have signed this landmark deal for BG Group in a market and a country where we have been intimately involved, throughout the gas chain, for a decade. It adds further diversity to our global LNG supply portfolio and builds upon our proven track record in capturing and developing new opportunities that continue to drive the global growth of our LNG business”.
Active in more than 25 countries on five continents, BG Group has a broad portfolio of exploration and production, LNG and transmission and distribution business interests.
Houston, Texas-based Cheniere Energy Partners owns 100 percent of the Sabine Pass LNG terminal located in western Cameron Parish, Louisiana, on the Sabine Pass Channel. The terminal has sendout capacity of 4.0 bcfd and storage capacity of 16.9 bcfe.
The US Department of Energy has authorized exports from the Sabine Pass LNG terminal of up to 803 billion cubic feet of natural gas per year (approximately 16 mtpa).
