Page 4 - GLNG Week 46 2021

GLNG COMMENTARY GLNG

Details disclosed of Cheniere’s LNG

supply deal with France’s Engie

US LNG producer Cheniere Energy is reported to have struck a deal to supply the fuel to

France’s Engie earlier this year

PROJECTS & LEADING US LNG producer Cheniere Energy momentum as the company tries to contract
COMPANIES struck a deal to supply the super-chilled fuel to more of its LNG capacity ahead of the FID on
France’s Engie earlier this year, according to a Corpus Christi Stage 3.
WHAT: letter to the US Department of Energy (DoE) The deals illustrate how appetite to strike
Cheniere is reported whose details have now been made public. new long-term offtake deals is growing against
to have reached a deal Under the newly disclosed deal, which was a backdrop of energy shortages. On the one
earlier this year to sell reached on June 23 according to the letter to the hand, buyers are cautious not to overcommit
LNG to Engie. DoE, Cheniere will supply 0.4-1.2mn tonnes in case demand drops off again, and the annual
per year (tpy) of LNG to Engie over an 11-year volumes involved in Cheniere’s deals – and a
WHY: period starting this year. The volumes will come number of those struck by other LNG compa-
The deal comes after from Cheniere’s Corpus Christi LNG terminal nies recently – are comparatively small. On the
Engie reportedly in Texas, where Cheniere is planning to add new other, these buyers are keen to avoid being left
abandoned talks with liquefaction capacity through its Stage 3 expan- overly exposed to the spot market, which has
NextDecade last year sion, with a final investment decision (FID) been particularly volatile over the past year.
amid pressure to oppose scheduled for next year.
the use of shale gas as Cheniere did not disclose the deal at the time Changing priorities
feedstock for LNG. that it was reached, and has not commented on The Cheniere-Engie deal is also notable because
the matter since it became public. However, the last year the French company pulled out of talks
WHAT NEXT: deal was followed by a number of others, which over a potential supply deal with a different US
Cheniere is moving closer were publicly disclosed by the LNG producer. LNG player, NextDecade, which is proposing to
to sanctioning additional In recent weeks, Cheniere has reached supply build a new liquefaction terminal in South Texas.
liquefaction capacity, agreements with commodity trader Glencore Engie was reported to have come under pressure
while NextDecade is being and Chinese firms ENN Natural Gas and Sin- from the French government not to buy LNG
held up by legal and ochem. All of those deals have been portrayed produced from shale gas. Hydraulic fracturing,
regulatory challenges. by Cheniere as evidence of its commercial a technique used to produce oil and gas from

P4 www. NEWSBASE .com Week 46 19•November•2021