Texas LNG Brownsville LLC, a 4 mtpa facility, started the year with no contracts and “now sits at ~88% contracted,” TPH analyst Zack Van Everen wrote in a Sept. 17 report. (Source: Shutterstock)
LNG facilities are starting to ink deals with E&Ps after a sluggish start to the year—but the vast majority are non-binding heads of agreement (HOA) rather than definitive sales and purchase agreements (SPA), according to analysis by TPH & Co., the energy business of Perella Weinberg Partners.
“Contracts with U.S. LNG facilities have picked up,” with 16.3 million tonnes per annum (mtpa) of new contracts signed since the end of April, TPH said. That brings the total number of new contracts in 2024 to 22.5 mtpa.
However, TPH noted that 17.6 mtpa, or 80%, of the contracts are HOAs. That compares to 2023, when about 80% of LNG facilities’ agreements were SPAs.
TPH tracked contracts that it said were spread across 10 facilities, with Sempra LNG’s Port Arthur Phase II, Glenfarne’s Texas LNG and NextDecade’s Rio Grande Train 4 securing the most agreements during the year.
Texas LNG Brownsville LLC, a 4 mtpa facility, started the year with no contracts and “now sits at ~88% contracted,” TPH analyst Zack Van Everen wrote in a Sept. 17 report.
“Texas LNG has 2 MTPA of contracts with EQT, 0.5 with Gunvor, and an estimated 1 MTPA with unnamed shippers,” Van Everen said. “Unlike prior years, most of the contracts in 2024 were signed by U.S. and international upstream producers” that included Shell, EQT, Exxon Mobil, Chesapeake Energy, Aethon and Aramco. Agreements with those companies totaled 13.9 mtpa of the 22.5 mtpa contracts signed.
TPH said contracts going to Asia only made up 5% of the total, with 20% headed for Europe.
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