Commonwealth LNG has signed a heads of agreement with US natural gas producer EQT for one million tonnes of LNG and associated gas supply to Commonwealth LNG’s facility in Cameron, Louisiana.
First cargo deliveries are expected in 2027 and will continue for a 15-year period.
Paul Varello, Executive Chairman and founder of Commonwealth LNG, said, “This agreement will connect EQT’s vast natural gas assets to Commonwealth’s LNG facility, thus creating a robust value chain from wellhead to water.”
He adds that accessing EQT’s natural gas production, which achieved a 20% year-over-year reduction in Scope 1 and Scope 2 greenhouse gas emissions, supports Commonwealth’s goal of achieving best in class environmental standards.
Commonwealth expects to achieve a final investment decision on the project in the first quarter of 2024. An accelerated construction schedule will allow the project to be built in three years using a modular approach with major components being fabricated offsite.
Once complete, the site will include six natural gas liquefaction trains and associated facilities capable of producing approximately 9.3 million tonnes per annum of LNG.
The terms anticipated under the heads of agreement will commence at the start of commercial operation of the facility. Final terms remain subject to negotiation of a definite agreement between the parties.
According to the US Energy Information Administration (EIA), Louisiana accounts for about 10% of US total marketed natural gas production and holds about 7% of the nation’s natural gas reserves.
The EIA further says that in 2022, Louisiana shipped 63% of the nation’s liquefied natural gas exports and about 14% of its coal exports.
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