On the eve of its Wall Street analysts conference Tuesday, Sempra Energy’s liquefied natural gas (LNG) unit announced a nonbinding “Heads of Agreement (HOA)” with Italy’s exploration/development company, Eni S.p.A., for a 20-year deal for one-third of the throughput at the Sempra LNG Cameron receiving terminal now under development near Lake Charles, LA.

Sempra said it expects to finalize a “definitive” terminal services agreement by mid-year. Eni is one of the world’s leading oil and gas E&P companies, and Sempra LNG is developing three new LNG receiving terminals in North America — one in North Baja, Mexico and another along the Texas Gulf of Mexico Coast in addition to the Louisiana facility.

Under the proposed agreement, Sempra LNG will provide Eni with between 400 MMcf/d and 600 MMcf/d (4.1 Bcm/year and 6.2 Bcm/year) of capacity at the Cameron receiving terminal, which is slated for completion in 2008. At that time, the Cameron terminal will have an initial capacity of 1.5 Bcf/d (15.5 Bcm/year) of regasified LNG supplies, Sempra said in making the announcement.

Sempra LNG President Darcel Hulse called the preliminary pact “another significant step” in his company’s aggressive LNG strategy, and he anticipated signing the definitive deal “in the near future.” Hulse praised the “new relationship” with Eni, which is a massive international company involved in not only oil and gas E&P, but also electricity generation, petrochemicals, engineering/construction, and various oil field services.

Earlier this year, Sempra LNG announced a similar nonbinding preliminary deal with Tractebel LNG North America LLC for between 325 MMcf/d and 500 MMcf/d of capacity at Cameron. That deal also is for 20 years and is expected to be finalized by June 30, Sempra said at the time of the HOA announcement (see Daily GPI, Jan. 28).

Located along the Calcasieu Ship Channel, about 15 miles south of Lake Charles, Cameron LNG has all the approvals needed to begin construction, and is slated to do so later this year. Sempra has committed to only beginning major LNG projects after securing long-term contracts for their throughput, or their own long-term contracts for supplies of LNG.

The Cameron terminal is expected to interconnect with major U.S. interstate and intrastate gas pipelines that collectively represent up to 10 Bcf/d of downstream capacity to four separate market regions (Midwest, Southeast, Atlantic and Northeast).

Earlier this winter Sempra began construction of another LNG receiving terminal — the first along the West Coast of North America — at Energia Costa Azul, along the Pacific Coast of North Baja, about 12 miles north of Ensenada. That terminal has all of its 1 Bcf/d capacity under contract through a combination of a 20-year capacity agreement for up to 500 MMcf/d with Shell International Gas Limited and a separate contract for 500 MMcf/d of Indonesian supplies that Sempra has purchased in a 20-year deal.

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