Cheniere subsidiaries sign gas supply agreements with EOG Resources

Cheniere’s subsidiaries Corpus Christi Liquefaction and Cheniere Corpus Christi Liquefaction Stage III have signed gas supply agreements (GSA) with EOG Resources.

As part of the long-term agreements, EOG will sell natural gas to Cheniere for 15 years from early next year.

The company will initially sell 140,000MMBtu/d and increase the quantity to 440,000MMBtu/d.

Cheniere will own and market the LNG associated with 140,000MMBtu/d of the gas supply.

EOG will receive a price based on the Platts Japan Korea Marker (JKM) for this gas and will sell the remaining 300,000MMBtu/d to Cheniere at a price indexed to Henry Hub.

Cheniere Gas Supply senior vice-president Corey Grindal said: “We are pleased to partner with EOG, one of the largest independent natural gas producers in the United States, on our second integrated production marketing (IPM) transaction which is expected to support Corpus Christi Stage III.

“The IPM commercial structure leverages our world-scale infrastructure platform and capabilities in Corpus Christi, offering domestic natural gas producers efficient access to global LNG prices and long-term flow assurance, while providing Cheniere with reliable delivery of natural gas and commercial support for growth.”

EOG noted that a part of the transaction is subject to certain conditions precedent, including a positive final investment decision on Cheniere’s Corpus Christi Stage III project, which will have up to seven midscale liquefaction trains.

Together, the trains would have a total expected aggregate nominal production capacity of approximately 9.5Mtpa.

In March, the Federal Energy Regulatory Commission granted a positive environmental assessment to Corpus Christi Stage III project, with all remaining regulatory approvals expected by the end of this year.

This June, Cheniere Corpus Christi Liquefaction Stage III signed a long-term agreement with Apache for the purchase of 140,000MMBtu/d of natural gas for 15 years.