Under the terms of the agreement, set to be finalized later this year, Glencore will purchase 2 mtpa of LNG from Commonwealth LNG and source natural gas from Kimmeridge Texas Gas. (Source: Shutterstock)
Kimmeridge Texas Gas (KTG) and Commonwealth LNG, both owned by Kimmeridge Energy Management, have entered into a heads of terms agreement with Glencore Ltd. to form a strategic natural gas and LNG partnership, the companies said on Sept. 19.
Under the terms of the agreement, Glencore will purchase 2 million tonnes per annum of LNG for 20 years from Commonwealth, as well as equivalent natural gas supply from KTG under a netback agreement at international prices.
The definitive agreements are expected to be finalized among the parties in the fourth quarter. Commonwealth anticipates a final investment decision on its LNG export facility in Cameron, Louisiana, in the first half of 2025, with first LNG production expected in 2028.
KTG CEO and President David Lawler said the partnership with Glencore represents “another tangible step forward for the KTG platform in becoming a fully integrated provider of reliable, secure and clean energy from wellhead to water.”
“With Commonwealth by our side, we look forward to reaching critical international markets in partnership with Glencore, who shares our vision of responsible LNG production and usage," he said.
Maxim Kolupaev, Glencore’s global head of LNG, gas and power, said the firm was excited to partner with KTG and Commonwealth “under a novel framework that leverages Glencore's premier LNG marketing platform and investment grade credit rating to facilitate access to international pricing.”
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