HomeNewsIneos Signs 20-Year LNG Supply Deal with Sempra

Ineos Signs 20-Year LNG Supply Deal with Sempra

12/1/2022

(P&GJ) — INEOS has signed a 20-year contract with Sempra Infrastructure for the supply of approximately 1.4 million tonnes per annum (MTPA) of LNG from Phase 1 of the Port Arthur LNG facility under development in Texas North America.

(Source: INEOS)

Under the agreement INEOS has agreed to purchase approximately 1.4 MTPA and has also signed a non-binding agreement for the potential purchase of an additional 0.2 MTPA from the Port Arthur LNG Phase 2 project under development. The first deliveries are expected in 2027.

“This long-term contract with Sempra Infrastructure and the agreement of regasification capacity in Brunsbuettel, secures the key areas of the value chain for INEOS across the Atlantic corridor and represents a major step forward in the INEOS Energy journey, at a time of significant transformation in the energy industry,” Brian Gilvary, INEOS Energy chairman, said.

In July, INEOS also signed a contract for long-term regasification capacity in the proposed German LNG Terminal in Brunsbuettel, Germany. These agreements mark INEOS’ entry into the global LNG market. The company is a first mover among European corporates as it secures competitive sources of energy to meet its own needs and those of its customers in Europe, as part of the energy transition.

The agreements come at a critical time for energy markets and will provide much needed security of supply for Europe.

"This LNG supply contract between INEOS and Sempra Infrastructure, ensures good continuity and stability in supplying LNG volumes to Germany on a long-term basis,” Ulco Vermeulen, member of the Executive Board of Gasunie, said. “We are excited that INEOS has secured its LNG supply and look forward to starting construction of the German LNG terminal in Brunsbuettel soon.”

The Port Arthur LNG project is a fully permitted facility on a 3,000-acre site in Jefferson County, Texas. It is expected to include two natural gas liquefaction trains and LNG storage tanks and associated facilities capable of producing, under optimal conditions, up to approximately 13.5mtpa of LNG.

The German LNG Terminal is a planned regasification facility in Brunsbuettel, Germany, that will have an annual throughput capacity of 8 billion cubic metres (Bcm) of natural gas and can be expanded to at least 10 Bcm. German LNG has executed the engineering procurement and construction contract and has entered into agreements with foundation customers INEOS, ConocoPhillips and RWE for long-term regasification capacity in the terminal. It is now focussing on securing the final permits to fully develop the terminal.

“We are excited to finalize our commercial relationship with INEOS as a valued long-term LNG off-taker for the Port Arthur LNG Phase 1 development project,” Justin Bird, CEO of Sempra Infrastructure, said. “We look forward to advancing this project so we can begin delivering new supplies of U.S. LNG to our European partners, as they pursue more secure energy for their customers.”

INEOS is committed to achieving net zero by 2050 across its operations. The company is working to decarbonise the supply chain through carbon capture and storage and provide optionality for alternative sources of energy such as its leadership in the production of hydrogen, as we develop them over time.

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