HomeNewsEQT in deal with Energy Transfer for Lake Charles LNG export plant

EQT in deal with Energy Transfer for Lake Charles LNG export plant

7/26/2023

(Reuters) - EQT, the biggest U.S. natural gas producer, entered into an liquefied natural gas (LNG) agreement with U.S. energy firm Energy Transfer's proposed Lake Charles liquefied natural gas (LNG) export plant in Louisiana.

EQT said in its second-quarter earnings release late Tuesday that the gas liquefaction, or tolling, agreement was for 1 million tons per annum of LNG.

Earlier this month Energy Transfer said it entered three non-binding agreements for a total of 3.6 MTPA of LNG from Lake Charles. Energy Transfer said one of those agreements was a tolling arrangement for 1 MTPA for a 15-year term with an unnamed U.S. customer.

Those three agreements, however, came even though the U.S. Department of Energy refused to extend Lake Charles' authorization to sell LNG to non-Free Trade Agreement (FTA) countries beyond December 2025.

Energy Transfer has vowed to keep developing Lake Charles even though it usually takes about four years to produce first LNG after construction starts. The company has not yet made a final investment decision (FID) to start building the project.

Officials at EQT were not immediately available for comment on the Lake Charles deal. The company, however, will hold an analyst call on the earnings later Wednesday.

Based on an industry estimate of around $800 million per MTPA, it could cost about $13.2 B to build the 16.5-MTPA Lake Charles project, before financing and other costs.

The two other Lake Charles agreements were with a Japanese consortium that will purchase 1.6 MTPA of LNG for a 20-year term and a unit of U.S. energy company Chesapeake Energy that will supply enough gas to produce 1.0 MTPA of LNG for 15 years that will go to a unit of Swiss commodities trader Gunvor.

Related News

Comments

{{ error }}
{{ comment.comment.Name }} • {{ comment.timeAgo }}
{{ comment.comment.Text }}