Cheniere Energy Inc.’s (NYSE MKT: LNG) wholly owned subsidiary, Cheniere Marketing International LLP, has entered into sales arrangements with Électricité de France SA (EDF) for the delivery of liquefied natural gas (LNG) cargoes on an ex-ship basis (DES) from the Sabine Pass LNG terminal to the Dunkerque LNG terminal in France.
The sales arrangements cover the delivery of up to 26 cargoes, or up to approximately 100 million MMBtu, through 2018. The sales price for the LNG cargoes is linked to the Dutch Title Transfer index (TTF), a natural gas pricing index in continental Europe.
Volumes will be sourced from Cheniere Marketing's LNG supply portfolio, which includes rights under a sale and purchase agreement (SPA) with Sabine Pass Liquefaction LLC to purchase any LNG produced from Sabine Pass in excess of that required for other customers. Cheniere Marketing has a similar SPA with Corpus Christi Liquefaction LLC for LNG produced from Cheniere's Corpus Christi liquefaction (CCL) project. On a combined basis, Cheniere Marketing's LNG portfolio is expected to have approximately 9 million tonnes per annum (MMtpa) of LNG available from the nine liquefaction trains being developed at Sabine Pass and Corpus Christi.
In addition to the 26 cargoes under these EDF transactions, Cheniere Marketing has sold 42 cargoes to date with delivery expected from Sabine Pass in the 2016–2018 timeframe. The majority of these cargoes were sold to customers on a DES basis whereby Cheniere Marketing will use its chartered vessels to deliver the LNG to the requested terminal. The sales price for these 42 cargoes is based on an applicable Henry Hub index price plus a fixed fee. In total, Cheniere Marketing has executed agreements for the sale of up to 68 cargoes, or up to approximately 250 million MMBtu, to buyers in Europe and Asia through 2018.
Cheniere Marketing has recently announced the sale of 0.6 MMtpa of LNG under a 20-year SPA with Central El Campesino, which is expected to be delivered from the CCL project. The SPA is subject to the Central El Campesino power project reaching a final investment decision. LNG will be sold on a DES basis with the sales price based on an applicable Henry Hub index plus a fixed fee.