Sempra Looks to Mitsui to Back LNG Projects

US energy infrastructure firm Sempra Energy has signed a memorandum of understanding with Japan’s Mitsui on joint development of LNG export projects in North America. Financing LNG projects is getting harder and so companies sometimes need to invest in both ends of the chain. Mitsui is already doing this in LNG Canada, where it is investing in the plant and will offtake cargoes.

The non-binding document includes a preliminary deal for Mitsui to take part in the second phase of the Sempra-led Cameron LNG project in Louisiana, Sempra said in a statement on October 28. Mitsui could purchase up to a third of Cameron LNG Phase 2’s capacity, as well as buy around 1mn mt/yr of its production. It did not say what the capacity would be.

Mitsui is already an equity partner in Cameron LNG’s first and second phases. The first phase consists of three 4mn mt/yr export trains, the first of which was launched in August. According to Sempra, the second phase has already secured all necessary regulatory permits and will involve the addition of two more trains and two more storage tanks.

The memorandum also covers Mitsui’s possible equity involvement in an expansion of Sempra’s 2.4mn mt/yr Energia Costa Azul (JCA) LNG project in Baja California, Mexico. Mitsui signed a heads of agreement with Sempra in November last year to potentially purchase 0.9mn mt/yr of LNG supply from ECA’s first phase over the 20-year period. The expansion is expected to add a further 12mn mt/yr of capacity to the project.

“This agreement signals continued momentum in the growing US LNG export market, while reinforcing the unique competitive advantage that Sempra offers customers seeking LNG export capabilities from the Gulf Coast, as well as the West Coast of North America,” Sempra LNG's president Justin Bird commented.