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Jordan Cove Backer Strikes Terminal's Second Capacity Deal

Veresen Inc. has struck a preliminary agreement for more capacity at the proposed Jordan Cove liquefied natural gas (LNG) terminal at Coos Bay in Oregon. ITOCHU Corp. tentatively agreed to purchase 1.5 million tonnes per annum (mtpa) of liquefaction capacity for a 20-year term.

Along with the agreement between Veresen and JERA Co. Inc., announced on March 22 (see Daily GPIMarch 22), Veresen said 3 mtpa of liquefaction capacity of the project has now been spoken for.

With about 130 bases in 65 countries, ITOCHU engages in domestic trading, import/export, and overseas trading of numerous products. Its energy division handles trading of general energy-related products, including crude oil, petroleum products, liquefied petroleum gas, LNG, natural gas, and electricity. The division also promotes exploration, development and production of oil and gas projects.

"This is the second major customer agreement for the Jordan Cove LNG project and it represents further proof of the market support for this project," said Veresen CEO Don Althoff.

David Ludlam, executive director of the Western Slope Colorado Oil & Gas Association, voiced support for Jordan Cove and enthusiasm for its second potential capacity agreement. "Piceance Basin Producers are reaching out to Jordan Cove customers before the ink dries, exploring the possibility of long-term supply agreements," he said.

Robert Boswell, CEO of Piceance Basin producer Laramie Energy, is among the companies that has already sent representatives to Japan. "The Piceance Basin has many attributes that no other basin in the country can offer," Boswell said. "Carrying this message to Asia last October alongside Gov. John Hickenlooper continues paying dividends. There is a real awareness overseas of what Piceance has to offer when Jordan Cove acquires final approval."

The Jordan Cove project is expected to have an initial design liquefaction capacity of 6.0 mtpa, or approximately 1 Bcf/d.

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