Athens: Magnolia LNG has signed a deal to provide liquefaction services of up to 2m tpa at Meridian LNG’s terminal on the Calcasieu shipping channel at Lake Charles, Louisiana.
The tolling agreement has an initial term of 20 years and firm annual capacity of 1.7m tpa. The contract includes the option to extend the contract term by a further five years and capacity by a further 0.3m tpa, at Magnolia’s discretion.
Magnolia will be paid monthly according to the capacity utilised, while Meridian will procure and deliver the feed gas to the liquefaction plant and arrange for its carriage by ship to end users.
Meridian LNG signed a 20-year gas sales agreement April 23 to supply LNG to E.ON Global Commodities. The liquefied gas will be delivered to the Port Meridian regasification terminal in north-west England, where Höegh LNG operates a floating storage and regasification unit (FSRU), which is connected to the UK’s National Grid via a subsea pipeline.
“We have been working with Meridian LNG since late 2013 and are delighted to have completed our first binding liquefaction tolling agreement. This is another significant milestone for Magnolia toward fully subscribing our 8m tpa project,” said Rick Cape, Magnolia LNG’s chief commercial officer.
“This agreement marks a critical step towards fulfilling our commitment to deliver up to 750m standard cubic feet a day of natural gas to E.ON Global Commodities, for 20 years from 2019, via our UK Port Meridian terminal,” added Roger Whelan, CEO of Meridian LNG, which is owned by Toronto-based institutional investment manager West Face Capital.
