China Gas Hongda Energy Trading Co. Ltd., a subsidiary of China Gas Holdings Ltd., has entered into an LNG sale and purchase agreement (SPA) with Energy Transfer LNG Export, LLC, a subsidiary of Energy Transfer LP, related to its Lake Charles LNG project, a June 5 press release announced.
Under the 25-year agreement, Energy Transfer LNG will supply 0.7 million tonnes per annum (mtpa) of LNG to China Gas on a free-on-board basis. The purchase price is indexed to the Henry Hub benchmark plus a fixed liquefaction charge, with first deliveries expected as early as 2026.
“This SPA brings our total amount of LNG contracted from our Lake Charles LNG export facility to nearly 6.0 mtpa and is an important step towards our goal of reaching FID [final investment decision] later this year,” Energy Transfer LNG president Tom Mason commented in the release.
The agreement will become fully effective upon the satisfaction of the conditions precedent, including Energy Transfer LNG reaching FID.
The agreement with Energy Transfer LNG marks China Gas' first long-term agreement and is an "important step along the path to realizing China’s carbon peaking and carbon neutrality goals," China gas general manager Yalong Qi added.
Based in Hong Kong, China Gas owns a total of 652 city and township gas projects with concession rights, 32 natural gas long-distance pipeline transmission projects, 113 LPG distribution projects and 554 CNG/LNG refilling stations for vehicles, as well as the license to import and export LNG and other fuel products in China.
Dallas-based Energy Transfer is a publicly traded limited partnership with core operations that include complementary natural gas midstream, intrastate and interstate transportation and storage assets; crude oil, NGL and refined product transportation and terminalling assets; and NGL fractionation, with assets in every major U.S. basin.
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