Energy Transfer and ENN Sign 20-Year LNG Sale and Purchase Agreements for Lake Charles LNG
March 29 2022 - 8:30AM
Business Wire
Energy Transfer LP (NYSE: ET), ENN Natural Gas (ENN NG
600803.SH) and ENN Energy Holdings Limited (ENN Energy 2688.HK)
today announced that ENN NG and ENN Energy have entered into LNG
Sale and Purchase Agreements with Energy Transfer LNG Export, LLC
(ET LNG), a subsidiary of Energy Transfer LP, related to its Lake
Charles LNG project.
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Under the two SPAs, ET LNG is expected to supply 1.8 million
tonnes of LNG to ENN NG, and 0.9 million tonnes of LNG to ENN
Energy, per annum on a free-on-board (FOB) basis. The purchase
price is indexed to the Henry Hub benchmark plus a fixed
liquefaction charge. Both SPAs are for a term of 20 years, and
first deliveries are expected to commence as early as 2026. The
SPAs will become fully effective upon the satisfaction of the
conditions precedent by ET LNG, including reaching FID.
“The signing of these long-term SPAs will further enrich ENN’s
LNG resources, expand resource supply channels, and improve ENN’s
natural gas supply capacity to meet the rapidly growing natural gas
demand in the domestic market,” said Zheng Hongtao, President of
ENN NG and Vice Chairman of the Board of Directors of ENN Energy
Holdings. “It also provides our customers with better resources and
services, ensures natural gas supply nationwide, and contributes to
the low-carbon transformation of energy structure.”
“We are very pleased to have ENN as a customer. The execution of
these two SPAs represents a significant event in moving the Lake
Charles LNG project towards FID. We are experiencing strong demand
for long-term offtake contracts for Lake Charles LNG and we are
optimistic that we will be in a position to take a positive FID by
year end,” said Tom Mason, President of ET LNG. “The Lake Charles
LNG project is expected to be financed primarily through
infrastructure funds and strategic partners, with Lake Charles LNG
retaining an equity stake and operatorship of the liquefaction
facility.”
Energy Transfer is one of the largest and most diversified
midstream energy companies in North America, with a strategic
footprint in all of the major U.S. production basins. The core
operations include complementary natural gas midstream, intrastate
and interstate transportation and storage assets; crude oil,
natural gas liquids (NGL) and refined product transportation and
terminalling assets; and NGL fractionation. The company owns and
operates approximately 120,000 miles of pipelines and associated
energy infrastructure across 41 states transporting approximately
30% of the United States’ oil and natural gas.
Lake Charles LNG will be constructed on the existing brownfield
regasification facility and will capitalize on four existing LNG
storage tanks, two deep water berths and other LNG infrastructure.
Lake Charles LNG will also benefit from its direct connection to
Energy Transfer’s existing Trunkline pipeline system that in turn
provides connections to multiple intrastate and interstate
pipelines. These pipelines allow access to multiple natural gas
producing basins, including the Haynesville, the Permian and the
Marcellus Shale.
ENN NG has an annual LNG distribution capacity of over 10 bcm
and runs the first large-scale private LNG terminal in China --
Zhoushan LNG Terminal. Its business layout covers the entire
natural gas value chain, including distribution, trading, storage
and transportation, and production and engineering.
Relying on industry best practices, ENN NG has built an
intelligent operation platform for the natural gas industry –
GreatGas.cn, which accelerates the aggregation of demand,
resources, reserves, and delivery ecology of the natural gas
industry. It also innovates and develops digital intelligence
services, and promotes the digital intelligence upgrade of the
natural gas industry. In 2021, ENN NG’s total natural gas sales
volume was 37.2 bcm, accounting for approximately 10% of China’s
total natural gas consumption.
About Energy Transfer
Energy Transfer LP (NYSE: ET) owns and operates one of the
largest and most diversified portfolios of energy assets in North
America, with a strategic footprint in all of the major U.S.
production basins. Energy Transfer is a publicly traded limited
partnership with core operations that include complementary natural
gas midstream, intrastate and interstate transportation and storage
assets; crude oil, natural gas liquids (NGL) and refined product
transportation and terminalling assets; and NGL fractionation.
Energy Transfer also owns Lake Charles LNG Company, as well as the
general partner interests, the incentive distribution rights and
28.5 million common units of Sunoco LP (NYSE: SUN), and the general
partner interests and 46.1 million common units of USA Compression
Partners, LP (NYSE: USAC). For more information, visit the Energy
Transfer LP website at energytransfer.com.
About ENN Natural Gas
As one of the largest independent energy companies in China, ENN
Natural Gas’s business layout covers the full natural gas value
chain, from downstream distribution, to midstream transportation
and storage, and upstream production and procurement. As of 31
December 2021, through its subsidiary, ENN Energy Holdings Limited,
one of the largest natural gas distributors in China, ENN Natural
Gas owns 252 city-gas projects in China, serving a population of
124 million. ENN Natural Gas owns and operates Zhoushan LNG
Terminal in Zhejiang Province, China. During 2021, ENN Natural
Gas’s total natural gas sales volume was 37.2 bcm, accounting for
about 10% of China’s total consumption.
Forward Looking Statements
This press release may include certain statements concerning
expectations for the future that are forward-looking statements as
defined by federal law. Such forward-looking statements are subject
to a variety of known and unknown risks, uncertainties, and other
factors that are difficult to predict and many of which are beyond
management’s control. An extensive list of factors that can affect
future results are discussed in the Partnership’s Annual Report on
Form 10-K and other documents filed from time to time with the
Securities and Exchange Commission. In addition to the risks and
uncertainties previously disclosed, the Partnership has also been,
or may in the future be, impacted by new or heightened risks
related to the COVID-19 pandemic, and we cannot predict the length
and ultimate impact of those risks. The Partnership undertakes no
obligation to update or revise any forward-looking statement to
reflect new information or events.
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Investor Relations: Bill Baerg Brent Ratliff Lyndsay Hannah
214-981-0795
Media Relations: Vicki Granado Alexis Daniel 214-840-5820
media@energytransfer.com
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