Cheniere Energy has entered a long-term liquefied natural gas (LNG) sales and purchase agreement (SPA) with Galp Trading S.A. a subsidiary of Galp Energia. Under the deal, Galp has agreed to purchase approximately 0.5 mtpa of LNG for 20 years from Cheniere on a free-on-board basis for a purchase price indexed to the Henry Hub price, plus a fixed liquefaction fee.
Deliveries are expected to begin in the early 2030s and are subject to, among other things, a positive final investment decision with respect to the second train of the Sabine Pass Liquefaction Expansion Project. The agreement includes a limited number of early cargoes to be purchased by Galp prior to the start of the new train.
“We are pleased to enter into this long-term agreement with Galp, a leader across Iberia’s energy sector, which reinforces the critical role US natural gas is expected to play in Europe’s energy mix into the second half of this century,” said Jack Fusco, Cheniere president and CEO. “We look forward to providing our flexible, reliable, and cleaner-burning LNG to Galp under this new long-term agreement. This SPA is expected to provide further support for the SPL Expansion Project and demonstrates continued momentum as we progress development of the project.”
The Sabine Pass Expansion is being developed for up to approximately 20 mtpa of LNG capacity, inclusive of estimated debottlenecking opportunities. In February 2024, certain subsidiaries of Cheniere Energy Partners applied to the Federal Energy Regulatory Commission for authorization to site, construct, and operate the project and applied to the Department of Energy requesting authorization to export LNG to Free-Trade Agreement (FTA) and non-FTA countries.
The Sabine Pass Expansion Project is located adjacent to Cheniere’s existing Sabine Pass Liquefaction facility in Cameron Parish, Louisiana. The project is planned to include two large-scale liquefaction trains, each with a nameplate capacity of 7 mtpa and a maximum production capacity of approximately 8.43 mtpa.
It will also feature a boiloff gas reliquefaction unit with a maximum reliquefaction capacity of approximately 0.90 mtpa. In addition, two full containment, aboveground 220,000-m3 LNG storage tanks with loading capabilities will be constructed.
