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Sempra signs HOAs with Total, Mitsui and Tokyo Gas for LNG project

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LNG Industry,

Sempra Energy has announced that its subsidiaries Infraestructura Energetica Nova S.A.B. de C.V. (IEnova) and Sempra LNG & Midstream have signed three heads of agreements (HOAs) with affiliates of Total S.A., Mitsui & Co. Ltd and Tokyo Gas Co. Ltd.

The HOAs are for the full export capacity of Phase 1 of the Energia Costa Azul LNG project in Baja California, Mexico. ECA LNG Phase 1 is a liquefaction plant with one train. It will be located next to the existing LNG receipt terminal, and is expected to produce approximately 2.4 million tpy of LNG for export.

Joseph A. Householder, president and chief operating officer of Sempra Energy, said: “These three HOAs mark a significant milestone for the development of the ECA liquefaction export-project, supporting Sempra Energy’s strategic vision of becoming North America’s premier energy infrastructure company.”

Carlos Ruiz Sacristán, CEO of the Sempra North American Infrastructure group and executive chairman of IEnova, added: “We look forward to working with three world-class and well-respected LNG companies to develop a project that should provide low-cost, flexible operations and reliable LNG to the Pacific Basin market and to supply the Baja California peninsula market in Mexico.”

Philippe Sauquet, president of gas, renewables and power for Total S.A., said: “We are pleased to work with Sempra Energy and IEnova to participate in the development of ECA LNG, which will benefit from synergies with existing infrastructure and from a significant shipping cost advantage for our customers in Asia.”

Hirotatsu Fujiwara, executive managing officer, chief operating officer of Energy Business Unit II, Mitsui & Co. Ltd, said: “We are pleased to work with Sempra Energy and IEnova for ECA LNG, which is another significant milestone to further strengthen the strategic partnership with Sempra LNG and IEnova in a broad range of business opportunities.”

Kentaro Kimoto, managing executive officer, chief executive of the Gas Resources & Energy Production Division of Tokyo Gas, added: “Tokyo Gas looks forward to working with the Sempra Energy team to advance the ECA LNG project and to provide the benefits of North American LNG supplies to our customers.”

According to the statement, the HOAs for ECA LNG Phase 1 contemplate the parties negotiating and finalising definitive 20-year LNG sales and purchase agreements (SPAs). Each of the three companies will potentially purchase approximately 0.8 million tpy of LNG from ECA LNG Phase 1. A final investment decision (FID) for ECA LNG is targeted in late 2019, with potential first LNG deliveries in 2023.

The participation of Total, Mitsui and Tokyo Gas in the ECA LNG project continues to be subject to finalisation of definitive agreements, amongst other things.

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