ConocoPhillips has deepened its commitment to the US liquefied natural gas (LNG) export market through a new long-term sales and purchase agreement (SPA) with Sempra Infrastructure.
The 20-year free-on-board agreement covers four million tonnes per annum (mtpa) of LNG from the proposed Port Arthur LNG Phase 2 project in Jefferson County, Texas.
According to the company, the transaction “will bolster ConocoPhillips’ ability to deliver natural gas to global markets”.
The Port Arthur Phase 2 development is being advanced by Sempra’s subsidiary, Sempra Infrastructure, and represents an expansion of the large-scale LNG export facility already under construction in the Gulf Coast region.
Initial operations for Phase 1 are scheduled to begin in 2027.
Emphasising the project’s growing relevance to international energy trade, Sempra’s chairman and CEO Jeffrey W. Martin stated: “The role of US LNG in meeting the energy security needs of America’s allies continues to grow.
“That is why we are excited to extend our partnership with ConocoPhillips to expand the Port Arthur LNG facility.
“This next phase reflects both companies’ shared view of the opportunity to connect American producers of natural gas with growing markets overseas, while also driving economic growth and job creation here at home.”
For ConocoPhillips, the agreement marks another milestone in building out its LNG portfolio.
Ryan Lance, chairman and CEO of ConocoPhillips, noted: “ConocoPhillips is pleased to extend our partnership with Sempra Infrastructure to Port Arthur LNG Phase 2, where we will be a major offtaker.
“This SPA advances our global LNG portfolio strategy as we build a flexible and reliable LNG supply network to meet growing energy demand.”
The new arrangement follows an earlier commitment by ConocoPhillips in July 2022, when the company signed a separate 20-year agreement to offtake 5 mtpa from Phase 1 of Port Arthur LNG.
That deal also gave ConocoPhillips a 30 per cent equity stake in the first phase of the project.
Unlike Phase 1, however, ConocoPhillips will not hold an ownership position in Phase 2 and will instead participate solely as an offtaker.
A final investment decision for the second phase remains pending.
Beyond its LNG investments, ConocoPhillips also continues to progress upstream exploration activities.
Earlier this year, the company announced that drilling had been completed at a second appraisal well at the Slagugle oil discovery in the Norwegian Sea.
