Cheniere (CQP) Unit Enters 3.5MT/Yr. LNG Purchase Contract with Gas Natural Fenosa
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Cheniere Energy Partners, L.P. (AMEX: CQP) announced today that its subsidiary, Sabine Pass Liquefaction, LLC, has entered into a liquefied natural gas sale and purchase agreement with Gas Natural Aprovisionamientos, a subsidiary of Gas Natural Fenosa, under which Gas Natural Fenosa has agreed to purchase 3.5 million tonnes per annum of LNG.
Sabine Liquefaction is developing liquefaction capabilities to produce 9.0 mtpa of LNG in the first phase of its project at the Sabine Pass LNG terminal owned by Cheniere Partners. This contract with Gas Natural Fenosa is another milestone for the project as Sabine Liquefaction has now reached its contract capacity target of 7.0 mtpa, which is expected to support the construction of the first two trains.
Under the agreement, Gas Natural Fenosa will pay Sabine Liquefaction a fixed sales charge for the full annual contract quantity and will also pay a contract sales price for LNG purchases based on the applicable Henry Hub index traded on the New York Mercantile Exchange. LNG will be loaded onto Gas Natural Fenosa's vessels. The SPA has a term of twenty years commencing upon the date of first commercial delivery, and an extension option of up to ten years. LNG deliveries are expected to commence in 2016. The SPA is subject to certain conditions precedent, including but not limited to Sabine Liquefaction's receiving regulatory approvals, securing necessary financing arrangements and making a final investment decision to construct the liquefaction facilities.
Sabine Liquefaction is developing liquefaction capabilities to produce 9.0 mtpa of LNG in the first phase of its project at the Sabine Pass LNG terminal owned by Cheniere Partners. This contract with Gas Natural Fenosa is another milestone for the project as Sabine Liquefaction has now reached its contract capacity target of 7.0 mtpa, which is expected to support the construction of the first two trains.
Under the agreement, Gas Natural Fenosa will pay Sabine Liquefaction a fixed sales charge for the full annual contract quantity and will also pay a contract sales price for LNG purchases based on the applicable Henry Hub index traded on the New York Mercantile Exchange. LNG will be loaded onto Gas Natural Fenosa's vessels. The SPA has a term of twenty years commencing upon the date of first commercial delivery, and an extension option of up to ten years. LNG deliveries are expected to commence in 2016. The SPA is subject to certain conditions precedent, including but not limited to Sabine Liquefaction's receiving regulatory approvals, securing necessary financing arrangements and making a final investment decision to construct the liquefaction facilities.
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