Germany’s RWE Supply & Trading, a subsidiary of RWE, inked a deal on Dec. 28 with a Sempra subsidiary to source 2.25 million tonnes per annum (mtpa) of LNG from the company’s Port Arthur LNG facility under development in Jefferson County, Texas.

LNG from Sempra Infrastructure's Port Arthur LNG Phase 1 will be delivered on a free-on-board basis for 15 years, San Diego-based Sempra said in a Dec. 28 press release. 

Sempra expects to make a final investment decision related to Phase 1 in the first quarter of 2023. First LNG cargoes are set to sail in 2027, according to the company.

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Sempra recently entered into long-term agreements with ConocoPhillips, INEOS and ENGIE for the sale and purchase of approximately 7.3 mtpa of LNG to be sourced from its Phase 1 project. 

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“The deal also provides a framework to explore ways to lower the carbon intensity of LNG produced from the Port Arthur LNG Phase 1 project through GHG emission reduction, mitigation strategies and a continuous improvement approach,” Sempra said in the release.

U.S.-sourced LNG remains in high demand in Europe and other markets from Asia to the U.K. amid lower gas flows from Russia, sanctioned after its military invasion of Ukraine earlier this year. 

“Our partnership with Sempra Infrastructure… is another important step to diversify Germany’s gas supply and thus contributes to enhancing security of supply in Europe on a long-term basis,” RWE Supply & Trading CEO Andree Stracke said as well in the Sempra release.

Port Arthur Phase 1 moving forward

Sempra’s Port Arthur LNG Phase 1 project is permitted and will include two LNG trains, LNG storage tanks and associated facilities capable of producing up to approximately 13.5 mtpa of LNG. 

The Port Arthur LNG Phase 2 project will also be capable of producing up to approximately 13.5 mtpa and is competitively positioned and under active marketing and development, according to Sempra.

“Because of its scale, location and permitting status, Port Arthur LNG is benefitting from a lot of commercial momentum with nearly all the projected off-take capacity for Phase 1 now under long-term agreements with some of the leading global energy companies,” Sempra Infrastructure CEO Justin Bird said in the release. “Today's announcement moves us one step further along in the process of making Port Arthur LNG a reality.”

RWE establishing LNG infrastructure in Germany

Beyond sourcing LNG supply, RWE is also involved in establishing Germany’s LNG import infrastructure. 

RWE has charted two floating storage and regasification units (FSRU) on behalf of the German government. RWE will operate one unit in Brunsbüttel, near Hamburg, from January 2023. Initial LNG cargoes have already been contracted, RWE said Dec. 28 in a separate press release

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Furthermore, German LNG GmbH aims to construct a land-based LNG regasification terminal in Brunsbüttel for the import and distribution of LNG. 

“The terminal will have an annual regasification capacity of 8 Bcm and provide a possibility to import gas directly to the German market from regions which cannot be reached by gas pipelines,” RWE said in its release.

Under current plans, the land-based terminal is slated to commence operations in late 2026. RWE has secured sufficient LNG volumes to make complete use of its booked regasification capacities at Brunsbüttel via the supply contract with Sempra Infrastructure, RWE said.