Cheniere signs 20-year LNG deal with China’s ENN

World Oil Staff June 26, 2023

(WO) – Cheniere Energy, Inc. has entered into a long-term liquefied natural gas (LNG) sale and purchase agreement (“SPA”) with ENN LNG (Singapore) Pte. Ltd., a wholly-owned subsidiary of ENN Natural Gas Co., Ltd.

Under the SPA, ENN has agreed to purchase approximately 1.8 million tonnes per annum of LNG from Cheniere Marketing on a free-on-board (“FOB”) basis for a purchase price indexed to the Henry Hub price. Deliveries will commence in mid-2026, ramping to 0.9 mtpa in 2027.

Delivery of the remaining 0.9 MTPA, which is subject to, among other things, a positive Final Investment Decision with respect to the first train of the Sabine Pass Liquefaction Expansion Project, will commence upon the start of commercial operations of Train Seven. The term of the SPA extends until the 20th anniversary of the start of commercial operations of Train Seven.

The SPL Expansion Project is being developed to include up to three natural gas liquefaction trains with an expected total production capacity of approximately 20 MTPA of LNG.

“This SPA further supports China’s structural shift to natural gas as a growing primary energy source, powering its economy while enabling improved environmental performance with flexible, reliable and cleaner LNG. This SPA accelerates Cheniere’s commercial momentum on the SPL Expansion Project, demonstrating the market’s need for additional LNG capacity, and the value of Cheniere’s unique capability to tailor long-term solutions for customers worldwide,” said Jack Fusco, Cheniere’s President and Chief Executive Officer.

This is the second long-term SPA signed between ENN and Cheniere Marketing. The long-term SPA signed in October 2021 initiated the first cooperation between two parties in the LNG business.

Wang, Yusuo, Chairman of the Board of ENN Natural Gas said, “At present, China is moving forward with the implementation of ‘carbon peaking & carbon neutrality,’ further accelerating the energy transformation, and China’s natural gas market is full of potential. As a leading global LNG supplier, Cheniere’s stable LNG production and supply capacity are highly compatible with China’s fast growing natural gas market. The signing of this long-term SPA marks another milestone in the establishment of good strategic cooperation between two parties, contributes to ENN Natural Gas’ establishment of an intelligent ecological operator in the field, provides customers with quality services and resources, and promotes the low-carbon transformation and upgrade of all industries.”


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