Electricite de France SA (EDF) has signed up to be the first foundation customer for the third train of Cheniere Energy Inc.’s Corpus Christi Liquefaction LLC project in Corpus Christi, TX.
EDF has agreed to buy 0.38 million tonnes per annum (mtpa) of LNG upon the commencement of operations of Train 2 and increase its purchased quantity to 0.77 mtpa upon the commencement of operations of Train 3. The project is being designed and permitted for up to three trains, with aggregate design production capacity of 13.5 mtpa of LNG.
The European electricity giant will buy LNG on a free on board basis. “The contract sales price will be equal to $3.50 plus 115% of the final settlement price for the New York Mercantile Exchange Henry Hub natural gas futures contract for the month in which the relevant cargo is scheduled,” Cheniere said in a regulatory filing. “A portion of the fixed fee component of the contract sales price will be subject to an annual adjustment for inflation.”
The term of the agreement is 20 years from the date of first commercial delivery from the third train of the project with an extension option of up to 10 years. Train 3 deliveries are expected as early as 2019. The price and terms in the contract are similar to other recent deals struck by Cheniere (see Daily GPI, July 1; June 30; June 2).
“We have completed contracting for the first two trains of the Corpus Christi Liquefaction Project and are in advanced discussions with other counterparties on finalizing additional agreements for Train 3,” said Cheniere CEO Charif Souki. “We expect to complete all necessary steps to reach a final investment decision and begin construction by early 2015.”
The EDF agreement is subject to conditions, including project regulatory approvals and financing, as well as a final investment decision on Train 3 by Cheniere.
© 2020 Natural Gas Intelligence. All rights reserved.
ISSN © 1532-1231 | ISSN © 2577-9877 |