Venture Global LNG and CNOOC Gas & Power Group, a wholly owned subsidiary of China National Offshore Oil Corporation (CNOOC), have announced the execution of a 20-year sales and purchase agreement (SPA). This marks the first LNG supply agreement signed by a US exporter with CNOOC, China’s largest importer of LNG.
Under the deal, Venture Global will supply 2m tonnes per annum of LNG on a free on board (FOB) basis from its Plaquemines LNG export facility, in Plaquemines Parish, Louisiana. In addition, CNOOC Gas & Power will purchase 1.5m tonnes of LNG from Venture Global’s Calcasieu Pass LNG facility for a shorter duration.
A recent research note from investment bank Evercore, using data from the IEA, shows that the US is now on track to be the world’s leading exporter of LNG by the end of next year.
“The main export destination for US LNG output has been East Asia, which is effectively 2x the distance to Europe and also represents much longer voyages than Australian/Qatari or even Russian seaborne LNG exports to Asia. Thus, what is good for US LNG exporters is good for global LNG vessel rates,” Evercore pointed out