U.S. energy firm Sempra has signed a non-binding supply agreement with Saudi Aramco for 5 million tonnes per annum of liquefied natural gas from the Port Arthur LNG Phase 2 expansion project for 20 years, the companies said.

The agreement also contemplates Aramco’s 25% participation in the project-level equity of Phase 2. In March, Reuters reported that Aramco was in talks to invest in the Port Arthur project in Texas.

Aramco is seeking to strengthen its position in the LNG market, especially in the U.S., where LNG capacity is set to almost double over the next four years.

“As a potential strategic partner in the Port Arthur LNG Phase 2 project, Aramco is well placed to grow its gas portfolio,” Nasir Al-Naimi, Aramco Upstream president, said in a statement.

The oil giant has reportedly held talks with other U.S. LNG firms including Tellurian TELL.A and NextDecade NEXT.O for long-term gas purchase agreements and stakes in their projects.

Sempra’s proposed phase 2 of Port Arthur LNG project is expected to add up to two trains capable of producing up to 13 Mtpa of the super-chilled fuel.
Source: Reuters (Reporting by Sourasis Bose in Bengaluru; Editing by Sriraj Kalluvila)