Loading of the first commissioning cargo at the Sabine Pass LNG Terminal in February 2016. File photo: Cheniere Energy
Cheniere Energy announced a long-term liquid natural gas (LNG) deal with Korea Southern Power Co. Ltd (KOSPO).
The deal brings together the leading LNG production and exporter in the United States and the leading power generation company in Korea.
“We are pleased to enter into this long-term LNG contract with KOSPO, the leading power generation company in Korea, in support of KOSPO’s growing natural-gas fired power generation capacity,” said Jack Fusco, Cheniere’s President and Chief Executive Officer. “This SPA is expected to support the SPL Expansion Project, and we are excited to build commercial momentum as the project’s development progresses. This SPA further highlights Cheniere’s leadership in providing flexible, cleaner burning energy supply to meet both the energy security needs and environmental goals of our customers in both the short and long term.”
The sale and purchase deal is for 0.4 million metric tonnes per annum (mtpa) from 2027-2046. A smaller annual amount with start being delivered in 2024.
The purchase price will be market-based until 2027. From 2027 onward it will be based on the Henry Hub price with an additional fee on top.
The SPAs volume from 2028-2046 is subject to a final investment depending on the first train of the Sabine Pass Liquefication (SPL) Expansion Project, designed to improve the LNG export capacity at the Sabine Pass facility in Port Arthur, Texas.
The SPL Expansion Project trains will have a 6.5 mtpa production capacity of LNG, 0.75 mtpa of re-liquefication production capacity, and two 220,000m^3 LNG storage tanks.
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