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ConocoPhillips to take 30%

stake in Port Arthur LNG

US CONOCOPHILLIPS has entered into a heads of terminated its sale and purchase agreement
agreement (HoA) to acquire a 30% stake in Sem- (SPA) for 2mn tpy of supply from Port Arthur.
pra’s proposed Port Arthur LNG export project However, it also signed a memorandum of
in Texas, it emerged this week. According to a understanding (MoU) that would allow it to buy
statement from the companies, ConocoPhillips the volumes originally contracted from the pro-
has also agreed to buy 5mn tonnes per year (tpy) ject from other facilities in Sempra’s LNG port-
of LNG output from the project. folio instead. At the time, PGNiG cited delays to
The costs involved in the transaction have not the development of Port Arthur as the reason
been disclosed. behind its decision.
The first phase of the Port Arthur LNG However, market conditions have changed
project is set to have a production capacity of dramatically since then owing to the war in
13.5mn tonnes per year (tpy) of LNG. Cono- Ukraine and intensifying competition for LNG.
coPhillips will also have the option to acquire In May this year, Sempra and PGNiG signed a
equity and offtake from Phase 2, which is also new HoA covering supply of LNG volumes from
under development at the Port Arthur site and both a future expansion of Sempra’s Cameron
would be of similar size to the first phase, accord- LNG project in Louisiana and also from Port
ing to the statement. Arthur.
The fact that plans for a second phase of Port That HoA only covers the supply of 1mn tpy
Arthur LNG are now under development rep- from Port Arthur, as well as 2mn tpy from Cam-
resent a significant turnaround for the project, eron LNG Phase 2, but allows for volumes to be
whose future previously looked less certain. In reallocated from Cameron to Port Arthur.
mid-2021, Saudi Aramco pulled out of talks to While the new deals with PGNiG and Cono-
acquire a 25% stake in the project and 5mn tpy coPhillips still need to be finalised, they take
of offtake from the terminal. Sempra a step closer to a final investment deci-
Shortly thereafter, Poland’s PGNiG sion (FID) on Port Arthur.™

P8 www. NEWSBASE .com Week 28 15•July•2022