Conoco to pursue role in Sempra LNG, CCS projects
ConocoPhillips said July 14 it had entered into a non-binding heads of agreement (HoA) with Sempra Infrastructure that could see the US major acquire a 30% equity interest in Sempra’s Port Arthur LNG project and offtake equivalent to about 5mn metric tons/year from the planned Texas liquefaction facility.
The HoA is a preliminary, non-binding arrangement, with development of the Port Arthur LNG project subject to concluding definitive agreements, signing engineering and construction contracts, obtaining financing and reaching a final investment decision between the parties.
|
Advertisement: The National Gas Company of Trinidad and Tobago Limited (NGC) NGC’s HSSE strategy is reflective and supportive of the organisational vision to become a leader in the global energy business. |
The first phase of Port Arthur LNG is fully permitted to include two liquefaction trains and storage tanks with optimal production capacity of 13.5mn mt/yr of LNG. Under the terms of the HOA, ConocoPhillips will supply gas for its 5mn mt/yr of offtake and will have the option to acquire additional offtake and equity positions in future LNG trains at Port Arthur, where a second 13.5mn mt/yr phase is under development.
“ConocoPhillips has been a driving force in the LNG industry since we helped open the Atlantic LNG market beginning in the 1950s, and then the Asia-Pacific market by delivering the first LNG cargo to Tokyo Bay in 1969,” CEO Ryan Lance said. “The decision to enter into this agreement with Sempra provides us with a ground-floor opportunity to participate in premier LNG developments, reinforcing our commitment to helping solve the world’s energy supply needs as we transition to a lower-carbon future.”
The two will also evaluate the future development of low-carbon projects, including a carbon capture and storage (CCS) component at Port Arthur, while Sempra will have the opportunity to participate in CCS projects developed by ConocoPhillips in Texas or Louisiana in connection with Port Arthur LNG.
The HOA also provides an opportunity for ConocoPhillips to acquire offtake and an equity position in phase two of Sempra’s Energia Costa Azul LNG project in Baja California, Mexico.