SCT&E LNG Inc. has announced that it has signed a binding 20-year fixed price natural gas supply agreement to support its future LNG facility to be constructed on Monkey Island in Cameron Parish, Louisiana, US.
In May 2015, SCT&E LNG signed a non-binding Memorandum of Understanding (MoU) with a natural gas supplier for a 20-year fixed price on natural gas from commencement of operations of the SCT&E LNG facility. In recent months, SCT&E LNG has been negotiating with its natural gas supplier to convert the MoU into a binding gas supply agreement.
SCT&E LNG’s Chairman and CEO, Greg Michaels, said: “I am very pleased to announce we have successfully completed the negotiations and now have a contractual method to offer this unique natural gas supply structure to our LNG offtakers. Together with our upstream supplier, we have essentially created a 25-year hedge on natural gas for our customers, and the LNG offtake community is responding positively.”
This 20-year fixed price natural gas supply offering is a first of its kind among US LNG export projects. The SCT&E LNG export project is currently scheduled to produce a total of 12 million tpy of LNG with shipments starting in 2022.
SCT&E LNG seeks to export LNG via take-or-pay tolling agreements and is focused on supplying LNG to meet customer needs during the ‘second wave’ of US LNG demand in 2022 and beyond. To date, the company has signed four offtake MoU’s for a total of 4.7 million tpy of LNG.
Edited from press release by Callum O'Reilly
Read the article online at: https://www.lngindustry.com/liquefaction/07062016/sct-e-lng-signs-binding-supply-agreement-2564/