General – LNG
ConocoPhillips today announced a potentially significant expansion of its global liquefied natural gas (LNG) business through investment in a new large-scale LNG facility under development by Sempra Infrastructure, in Jefferson County, Texas.
ConocoPhillips has entered into a Heads of Agreement (HOA) with Sempra to acquire a 30% direct equity holding in Port Arthur Liquefaction Holdings, LLC and an LNG offtake equivalent to approximately 5 million tonnes per annum (Mtpa) from the Port Arthur LNG project.
The first phase of the project is fully permitted and expected to include two liquefaction trains and LNG storage tanks, as well as associated facilities capable of producing, under optimal conditions, up to approximately 13.5 Mtpa of LNG. As one of the top five natural gas marketers in North America, ConocoPhillips will bring extensive commercial expertise and resources to benefit the project.
Under the terms of the HOA, ConocoPhillips will supply the gas for its 5 Mtpa offtake and may provide additional gas supply services to the Port Arthur LNG facility. In addition, ConocoPhillips will have the option to acquire certain LNG offtake and equity ownership from future contemplated LNG trains at the Port Arthur LNG site, where a similarly sized Phase 2 project is also under development.
The companies will also evaluate development of low-carbon projects, including a carbon capture and storage (CCS) project for the Port Arthur LNG facility, and Sempra Infrastructure would have the opportunity to participate in carbon capture and sequestration projects developed by ConocoPhillips in Texas or Louisiana in connection with the Port Arthur LNG project.
Additionally, the HOA provides an opportunity for ConocoPhillips to acquire offtake and equity participation in Sempra’s development of the Energia Costa Azul LNG Phase 2 Project to be located north of Ensenada, Baja California, Mexico. This future expansion of the existing Energia Costa Azul project is ideally located to supply Asia-Pacific markets.