On Dec. 19, Energy Transfer announced a 20-year agreement to supply Chevron with two million tons per annum (mtpa) of liquefied natural gas (LNG) from its Lake Charles LNG export facility in Louisiana.
Under the terms of the agreement, Energy Transfer LNG will provide LNG to Chevron on a free-on-board basis. The pricing structure includes a fixed liquefaction fee and a variable component tied to the Henry Hub natural gas benchmark, Energy Transfer said. The statement also noted obligations of Energy Transfer LNG under the sale and purchase agreement are subject to Energy Transfer LNG taking a final investment decision (FID) as well as the satisfaction of other conditions precedent.
Energy Transfer noted the company's Lake Charles LNG facility is designed to leverage existing infrastructure, including four LNG storage tanks, two deepwater berths, and other assets from its current "regasification" operations. The company said the facility’s integration with its trunkline pipeline system provides direct access to major natural gas producing regions such as the Haynesville, Permian, and Marcellus Shale basins.
