Aramco, one of the world’s leading integrated energy and chemicals companies, and Sempra, one of North America’s leading energy infrastructure companies, have announced that their respective subsidiaries have executed a non-binding Heads of Agreement (HoA). This agreement pertains to a 20-year sale and purchase agreement (SPA) for the offtake of 5.0 million tonnes per annum (Mtpa) of liquefied natural gas (LNG) from the Port Arthur LNG Phase 2 expansion project. Additionally, the HoA includes Aramco’s potential 25% participation in the project-level equity of Phase 2.
The parties anticipate executing a binding LNG SPA and definitive equity agreements, with terms similar to those in the HoA, subject to a number of conditions.
Nasir K. Al-Naimi, Aramco Upstream President, stated, “We are excited to take this next step into the LNG sector. As a potential strategic partner in the Port Arthur LNG Phase 2 project, Aramco is well placed to grow its gas portfolio with the aim of meeting the world’s growing need for lower-carbon sources of energy. This agreement is a major step in Aramco’s strategy to become a leading global LNG player.”
Jeffrey W. Martin, Sempra Chairman and CEO, commented, “The planned expansion of Port Arthur LNG would help facilitate the broad distribution of U.S. natural gas across global energy markets. By expanding the global reach of the Port Arthur LNG facility, we have the opportunity to improve energy security while providing a lower-carbon alternative to coal for electricity production.”
Port Arthur LNG is a natural gas liquefaction and export terminal in Southeast Texas with direct access to the Gulf of Mexico. The Port Arthur LNG Phase 1 project is currently under construction and includes trains 1 and 2, two LNG storage tanks, and associated facilities. The Port Arthur LNG Phase 2 project is a competitively positioned expansion, potentially adding up to two more trains capable of producing up to 13 Mtpa.
At the heart of Sempra Infrastructure’s flagship Port Arthur Energy Hub, Port Arthur LNG has the potential to expand to a total of eight trains, positioning it as one of the world’s most significant LNG export facilities. The facility is expected to play a crucial role in enhancing global energy security and resilience. Additionally, Sempra Infrastructure is actively advancing projects within the Port Arthur Energy Hub to meet the rising demand for lower-carbon fuels and reduce emissions, including the proposed Titan Carbon Sequestration project.
