Cheniere inks sales pact with Korea Gas to export Sabine Pass LNG
Cheniere Energy Partners said Monday that its Sabine Pass Liquefaction subsidiary has entered into a liquefied natural gas (LNG) sale and purchase agreement with Korea Gas Corp.(Kogas), under which Kogas has agreed to purchase 3.5 million tpy of LNG upon the completion of train three operations.
Under the agreement, state-run Kogas will purchase LNG on an FOB (free on board) basis for a purchase price indexed to the monthly Henry Hub price plus a fixed component.
LNG will be loaded onto Kogas's vessels, officials said.
The agreement has a term of 20 years commencing upon the date of first commercial delivery for train three, and an extension option of up to 10 years.
Deliveries from train three are expected to occur as early as 2017.
The deal is subject to certain conditions precedent, including but not limited to Sabine Liquefaction receiving regulatory approvals, securing necessary financing arrangements and making a final investment decision to construct the second phase of the liquefaction project, the company said.
"Kogas is our fourth foundation customer and we have now sold 16 million tpy of the 18 million tpy being developed at the Sabine Pass LNG terminal,” said Charif Souki, CEO.
“Kogas is a strong addition to our portfolio of customers as it is the largest LNG importer in the world and the dominant gas provider for the Republic of Korea, a nation that is soon to become a free trade nation with the US,” he continued.
“We look forward to finalizing all necessary steps in order to begin construction of the first phase of our project early this year and more importantly, to becoming the first LNG exporter in the continental US."
Last week, BG Group added another 2 million tpy to its LNG purchase agreement with Sabine Liquefaction, bringing its total to 5.5 million tpy.
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