With CNPC Deal, Cheniere's Train 3 at Corpus Christi Becomes More Likely



With CNPC Deal, Cheniere's Train 3 at Corpus Christi Becomes More Likely
CNPC unit to buy roughly 1.2 mtpa of LNG through 2043.

Cheniere Energy, Inc. has entered into two liquefied natural gas (LNG) sale and purchase agreements (SPA) with China National Petroleum Corp. (CNPC), the Houston-based company reported Friday.

“These long-term SPAs build upon the Memorandum of Understanding we signed in November, and we look forward to a successful long-term partnership with CNPC,” Cheniere President and CEO Jack Fusco said in a written statement.

According to Cheniere, CNPC unit PetroChina International Co. Ltd. will purchase approximately 1.2 million tonnes per annum (mtpa) of LNG under the SPAs with Cheniere subsidiaries Corpus Christi Liquefaction, LLC and Cheniere Marketing International LLP. A portion of the supply will start this year and the balance will begin in 2023, Cheniere added. Each SPA term continues through 2043 and the LNG purchase price will be indexed to the Henry Hub price plus a fixed component, the company stated.

Fusco also stated that Cheniere expects the SPAs to support the development of a third train at the Corpus Christi Liquefaction export terminal that it is building along Corpus Christi Bay in San Patricio County, Texas.

"(W)e are now focused on completing the remaining necessary steps to reach a final investment decision later this year," said Fusco.

In 2015 Cheniere began construction of the Texas Coastal Bend facility’s first two trains but it is designing the complex for five trains with a projected nominal production capacity of up to 22.5 mtpa of LNG, according to the Corpus Christi LNG website. The company reports that 8.42 mtpa of the project’s production capacity has already been contracted, and foundation customers include:

  • Pertamina
  • Endesa
  • Iberdrola
  • Gas Natural Fenosa
  • Woodside
  • EDF
  • EDP

During President Trump’s trip to China this past November, various U.S. businesses and Chinese entities signed trade and investment deals. According to the U.S. Department of Commerce, the MOU that Fusco references above calls on Cheniere and CNPC to “continue in-depth discussions to strengthen cooperation on LNG export projects and the long-term LNG procurement cooperation between China and the U.S.”



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