CERAWEEK: Engie extends term of LNG offtake deal with Cheniere's Texas facility

French utility Engie has agreed to extend the term of the offtake commitment it reached with Cheniere Energy in summer 2021 that was tied to the biggest US LNG exporter's Texas liquefaction facility, Cheniere said March 9.

The volume has also been adjusted to include a higher average over the life of the deal, Cheniere said in a statement during the CERAWeek by S&P Global energy conference in Houston.

Under the new sale and purchase agreement, Engie has agreed to purchase approximately 900,000 mt/year from Corpus Christi Liquefaction on a free-on-board basis for a term of around 20 years. The original deal, announced in June 2021, began in September 2021.

The purchase price for LNG under the amended agreement is indexed to the US Henry Hub price, plus a fixed liquefaction fee that Cheniere did not disclose.

The original deal was an 11-year agreement that covered a range of approximately 400,000 mt/year to 1.2 million mt/year of LNG is to be delivered to Engie from the Texas terminal, according to a Cheniere letter to the US Department of Energy that was released in the fall of 2021. The original deal was said to be between Cheniere's marketing unit and Engie.

The terms of the contract, beyond its length, volume and delivery basis, were not disclosed.

Cheniere also operates an export facility at Sabine Pass in Louisiana. It expects to sanction in 2022 construction of an up to 10 million mt/year midscale liquefaction expansion at the site of its Texas facility.

Fixed-price term commercial activity among several US LNG exporters and developers -- most notably Cheniere and Venture Global LNG -- has picked up over the last year, amid high spot LNG prices in destination markets in Europe and Asia.