Cheniere Secures More Gas for Corpus Christi

Texan LNG exporter Cheniere Energy has clinched long-term agreements for gas supply from shale developer EOG Resources to its Corpus Christi liquefaction complex.

Cheniere said on September 17 its subsidiaries Corpus Christi Liquefaction and Cheniere Corpus Christi Liquefaction Stage III had signed deals to purchase gas from EOG for 15 years beginning in early 2020. Supply volumes will start at 140,000mn British thermal units (Btu)/day – enough to produce 0.85mn mt/yr of  LNG – before ramping up to 440,000mn Btu/day.

Cheniere will pay a price for the initial 140,000mn Btu/day of gas based on the Platts Japan Korea Marker (JKM) , and will own and market the LNG produced from these supplies. It will receive the remaining 300,000mn Btu/day at a Henry Hub-indexed rate.

Corpus Christi’s second 4.5mn mt/yr export train was officially declared operational earlier this month. A third train is due online in the second half of 2021, bringing overall capacity to 13.5mn mt/yr. The deal with EOG will support Cheniere’s plan to add seven more 1.4mn mt/yr trains at the site, building on a supply contract it agreed with US producer Apache back in June. Cheniere is currently seeking regulatory approvals for this expansion scheme, known as Stage III, in order to take a final investment decision (FID).

“We are pleased to partner with EOG, one of the largest independent natural gas producers in the United States, on our second Integrated Production Marketing transaction which is expected to support Corpus Christi Stage III,” Cheniere’s senior vice president for gas supply Corey Grindal said in a statement.

EOG’s senior vice president for marketing, Lance Terveen, noted that: “Adding gas sales agreements linked to LNG prices supports EOG’s portfolio approach to marketing our growing production of low-cost natural gas. These agreements further diversify our access to customers across multiple end markets in order to maximise our natural gas price realisations.”