Friday, April 19, 2024
HomeLNGPGNiG signs long-term contract for the supply of American LNG

PGNiG signs long-term contract for the supply of American LNG

Poland’s oil and gas group PGNiG has signed Heads of Agreement with US-based company Sempra Infrastructure, for the purchase and sale of 3 million tons of liquefied natural gas (LNG) per annum. The LNG would be sourced from two liquefaction terminals in the Gulf of Mexico and would come to Poland, among others, via a floating regasification terminal in the Gulf of Gdansk.

In particular, the 20-year sale and purchase agreements focus on LNG imported from the future expansion of the Cameron LNG terminal in Louisiana and the anticipated Port Arthur LNG terminal in Texas. The Cameron LNG expansion terminal is expected to be the source of 2 million tons of LNG per annum while the Port Arthur LNG terminal is expected to be the source of 1 million tons of LNG per year. The total annual volume corresponds to approximately 4 billion cubic metres (bcm) of natural gas after regasification. The parties expect that the initial deliveries of LNG may start in 2027. The future contract would be based on the free-on-board formula, which means that the buyer is responsible for LNG shipments originating from the liquefaction terminals.

”The agreement signed today paves the way for negotiations on detailed terms of the LNG contract that will provide PGNiG with LNG from a reliable and highly valued infrastructure partner,” said Iwona Waksmundzka-Olejniczak, PGNiG President. “LNG is already one of the cornerstones of our diversified strategy to enhance Polish energy security as well as strengthen the commercial potential of the PGNiG Group. We are determined to further expand our operations in this direction and are therefore taking steps to secure access to adequate gas volumes in the future. We also take into account the planned launch of a floating regasification terminal in the Gulf of Gdansk, which is expected to be an important element of the gas import infrastructure for Poland and the whole region.”

“Today’s agreement underscores our commitment to helping provide energy security to Poland and our global partners through long-term LNG sales,” added Dan Brouillette, president of Sempra Infrastructure. “Our relationship with PGNiG is core to this commitment and we are excited to continue working closely with them to advance more reliable, secure and increasingly clean energy solutions.”

The Gulf of Gdansk LNG terminal is a project developed by GAZ-SYSTEM, which already operates the President Lech Kaczynski LNG Terminal in Świnoujście. Plans call for the terminal to have a regasification capacity of approximately 6 bcm of natural gas per annum. GAZ-SYSTEM has already finished the first phase of the Open Season procedure aimed at assessing the interest of market players in using the terminal, during which PGNiG had placed an order for FSRU regasification services. 

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