Williams in gas supply deal with Sempra Infrastructure
US gas infrastructure company Williams said November 15 it had entered into a non-binding heads of agreement (HOA) with Sempra Infrastructure to create an integrated platform connecting natural gas supply from the Haynesville shale basin to growing LNG on the US Gulf Coast.
The HOA contemplates long-term natural gas sales of about 500mn ft3/day delivered near Gillis, Louisiana and two LNG offtake agreements for 3mn metric tons/year in aggregate from Sempra Infrastructure’s proposed Cameron LNG Phase 2 and Port Arthur LNG projects in Louisiana and Texas.
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Cameron LNG Phase 2 would include a single 6.75mn mt/yr liquefaction train and debottlenecking at the existing 13.5mn mt/yr Cameron LNG facility. The Phase 2 expansion is under active development, Sempra says.
The first phase of Port Arthur LNG would include two liquefaction trains capable of producing up to 13.5mn mt/yr of LNG. Sempra intends to take a final investment decision on the $10.5bn project in Q1 2023.
The proposed transactions complement Williams’ recently-sanctioned Louisiana Energy Gateway (LEG) gathering project and are expected to include connections to pipelines serving Sempra Infrastructure’s LNG export facilities.
Under the HOA, the two companies intend to form a strategic joint venture to own, expand and operate the Cameron Interstate Pipeline that would deliver gas to Cameron LNG Phase 2 in Louisiana. Other pipelines are also being considered by the joint venture, including the Louisiana Connector Pipeline which would supply the Port Arthur LNG facility in Texas.
“We see [this transaction] as an opportunity to combine our capabilities along the natural gas value chain and increase the delivery of low-carbon, affordable and reliable natural gas from the wellhead to the growing international market,” Williams president Alan Armstrong said. “Facilitating the delivery of next generation natural gas to ease energy constraints at home and overseas, while also helping to meet domestic and global climate goals, is central to our natural gas focused strategy, and we look forward to being well aligned with Sempra Infrastructure’s unique capabilities and competitive advantages in the LNG infrastructure space.”