Vitol Boosts Cheniere's Growth Plans with 15-year Deal
Vitol Inc. has signed a liquefied natural gas (LNG) sale and purchase agreement (SPA) with Cheniere Marketing, LLC, parent company Cheniere Energy, Inc. reported Monday.
“We are pleased to announce this long-term SPA with Vitol, one of the fastest growing players in the global LNG market,” Jack Fusco, Cheniere’s president and CEO, said in a written statement. “This agreement continues Cheniere’s commercial momentum and supports our growth plans, while demonstrating the value LNG buyers place on Cheniere’s unique ability to offer flexible solutions tailored to the needs of LNG customers worldwide.”
Under the SPA, Vitol has agreed to purchase approximately 0.7 million tonnes per annum of LNG from Cheniere Marketing on a free on board basis for an approximately 15-year term starting this year, Cheniere stated. According to the LNG project developer, the LNG purchase price is indexed to the monthly Henry Hub price plus a fee.
“We are delighted to be working with Cheniere, a pioneer in U.S. liquefaction,” according to Vitol Group CEO Russell Hardy. “Vitol is committed to the long-term development of the LNG market. We believe that LNG has an important role to play in the future energy mix and that its evolution will require a more flexible and tradeable LNG market.”
Monday’s announcement is the second SPA Cheniere has announced in as many months. On August 10, the company reported that it had signed a 25-year SPA with Taiwan’s CPC Corp. Under that deal, CPC agreed to purchase roughly 2 mtpa beginning in 2021.
Houston-based Cheniere owns and operates the Sabine Pass LNG liquefaction terminal Cameron Parish, La. In addition, the company is developing and constructing the Corpus Christi Liquefaction project in San Patricio County, Texas.
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