Cheniere Energy, Inc. subsidiary, Corpus Christi Liquefaction, LLC, has entered into an LNG sale and purchase agreement (SPA) with EDP Energias de Portugal S.A. (EDP).
Under the agreement, EDP has agreed to purchase approximately 0.77 million tpy of LNG upon the commencement of operations of Train 3 of the LNG export facility being developed near Corpus Christi. The Corpus Christi Liquefaction Project is being designed and permitted for up to three trains, with aggregate design production capacity of approximately 13.5 million tpy of LNG.
EDP will purchase LNG on a free on board basis (FOB) for a purchase price indexed to the monthly Henry Hub price plus a fixed component. LNG will be loaded onto EDP's vessels. The term of the SPA will extend for twenty years beyond the date of first commercial delivery of the third train of the Corpus Christi Liquefaction Project, with an extension option of up to ten years. Deliveries from Train 3 are expected to occur as early as 2019.
Commenting on the agreement, Charif Souki, Cheniere Chairman and CEO, said: "EDP, Portugal's largest supplier of electricity and second largest supplier of gas, is the second customer to contract for LNG on Train 3 of the Corpus Christi Liquefaction Project. We have entered into SPAs aggregating approximately 8.42 million tpy of LNG and are in discussions with additional counterparties for agreements that would commence with Train 3. We expect to complete all necessary steps to reach a final investment decision and begin construction by early 2015."
The SPA is subject to certain conditions precedent, including but not limited to Corpus Christi Liquefaction receiving regulatory approvals, securing necessary financing arrangements and making a final investment decision to construct Train 3 of the Corpus Christi Liquefaction Project.
Adapted from press release by Katie Woodward
Read the article online at: https://www.lngindustry.com/liquefaction/18122014/edp-to-buy-lng-from-corpus-christi-project-1979/