US Commonwealth LNG to announce 1 mln T supply contract in 'a day or two', exec says
SINGAPORE, Sept 5 (Reuters) - A U.S. liquefied natural gas (LNG) export project, Commonwealth LNG, plans to announce a long-term deal to supply 1 million metric tons of LNG to a company involved in global trade in 'a day or two', Executive Chairman Paul Varello told Reuters.
"I would call them more of an LNG trader, so they can ship anywhere in the world. We're selling at our dock, FOB (free on board)", Varello, also the company's founder, said on the sidelines of the Gastech conference in Singapore on Tuesday.
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Commonwealth LNG is developing an LNG export terminal on the U.S. Gulf Coast near Cameron, Louisiana, with a proposed 9.3 million tons of annual capacity. Its first cargo is expected to be shipped in the first half of 2027, he added.
Varello said that the project's final investment decision (FID) has slipped to the first quarter of next year from this year's fourth quarter as customers, in particular Europeans, are slow to commit for long-term contracts.
"We need 8 million tons under long term contracts to reach FID," Varello said, adding that the upcoming long-term deal and previously signed deals with Woodside, Kimmeridge Energy Management and MET cover 6 million tons of LNG offtake per year.
Varello expects Commonwealth LNG to start pre-FID construction in November or December this year to be followed by the post-FID construction after the first quarter of 2024, as talks with over a dozen potential customers for the remaining 2 million tonnes of long-term LNG supply are ongoing.
Private equity firm Kimmeridge Energy Management agreed to take an undisclosed but minority stake in Commonwealth LNG and may become a gas supplier to the project. Kimmeridge holds stakes in U.S. oil and gas producers.
There are eight LNG export projects in the United States now under way that when completed would add 86 million tons per year (MTPA) capacity of the super-chilled natural gas.
(Reporting by Sudarshan Varadhan; Writing by Katya Golubkova; Editing by Jacqueline Wong and Kim Coghill)