Cheniere Energy, Inc. announced that its subsidiary, Corpus Christi Liquefaction Stage III, LLC, has entered into a long-term Integrated Production Marketing gas supply agreement with ARC Resources U.S. Corp, a subsidiary of ARC Resources, Ltd., a leading natural gas producer in Canada.
Under the IPM agreement, ARC U.S. has agreed to sell 140,000 MMBtu per day of natural gas to Corpus Christi Stage III for a term of 15 years, commencing with commercial operations of Train 7 of the Corpus Christi Stage III Project. The LNG associated with this gas supply, approximately 0.85 million tonnes per annum (“mtpa”), will be marketed by Cheniere. Cheniere will pay ARC U.S. an LNG-linked price for its gas, based on the Platts Japan Korea Marker (JKM), after deductions for fixed LNG shipping costs and a fixed liquefaction fee. ARC Resources, Ltd. will act as guarantor of the IPM agreement on behalf of ARC U.S. The IPM agreement is subject to Corpus Christi Stage III making a positive final investment decision to construct the Corpus Christi Stage III Project.
“We are pleased to enter into this long-term IPM agreement with one of Canada’s largest natural gas producers, enabling Canadian natural gas to reach international markets,” said Jack Fusco, Cheniere’s President and CEO. “This commercial agreement further demonstrates Cheniere’s ability to create collaborative, innovative tailored solutions that meet the needs of our customers. This IPM agreement with ARC U.S. is expected to provide additional support to the Corpus Christi Stage III Project, which we expect to reach FID this summer.”
The Corpus Christi Stage III Project is being developed to include up to seven midscale liquefaction trains with a total expected nominal production capacity of over 10 mtpa.
