Sempra LNG and Infraestructura Energética Nova SAB de CV (IEnova) have announced that their joint venture, ECA LNG, has signed an equity investment agreement to finalise Total's participation in the ECA LNG phase 1 LNG export project, to be located in Baja California, Mexico.
Under the terms of the agreement, Total has acquired a 16.6% equity stake in ECA LNG phase 1, while Sempra LNG and IEnova will each retain 41.7% ownership. Earlier this year, Total signed a 20-year sale and purchase agreement for approximately 1.7 million tpy of LNG from the export facility.
“We are excited to extend our strategic alliance with Total, a global LNG leader, as we commence construction on our landmark ECA LNG phase 1 project and help expand Total's North America LNG infrastructure portfolio,” said Justin Bird, CEO of Sempra LNG. “This agreement is the next step in advancing our long-term strategy to provide the world with access to diverse US natural gas basins that can offer reliable and more secure forms of energy from both the Pacific and Gulf Coasts.”
Last month, ECA LNG announced that it reached a final investment decision (FID) for the construction and operation of the approximately US$2 billion facility. ECA LNG phase 1, a Pacific Coast LNG export project with direct access to abundant natural gas supplies in Texas and the Western US, will be a single-train liquefaction facility with a nameplate capacity of 3.25 million tpy of LNG and an initial offtake capacity of approximately 2.5 million tpy of LNG. ECA LNG phase 1 will be built at IEnova's existing Energía Costa Azul LNG regasification facility. The equity acquisition by Total does not include an equity interest in the regasification facility.
As previously announced, ECA LNG phase 1 also has a definitive 20-year sale and purchase agreement with Mitsui & Co. Ltd for the purchase of approximately 0.8 million tpy of LNG from phase 1 of the project.
“This important equity investment by Total is evidence of international confidence in our energy infrastructure projects as well as the future of investment in Mexico,” said Tania Ortiz, CEO of IEnova. “We will remain focused on our mission to foster the country's economic development and well-being of the communities where we operate.”
Sempra LNG and Total are already partners in Cameron LNG, a 12 million tpy LNG export facility operating in Hackberry, Louisiana. Phase 1 of Cameron LNG reached full commercial operations in August 2020.
Sempra LNG is developing additional LNG export facilities on the Gulf Coast and Pacific Coast of North America, including Cameron LNG phase 2 and ECA LNG phase 2. The successful development and ultimate construction of these projects as well as Sempra Energy's other LNG export projects are subject to a number of risks and uncertainties and there can be no assurance that these projects will be completed.
Last week, Sempra Energy announced a series of integrated transactions that would combine Sempra LNG and IEnova under a new business platform, Sempra Infrastructure Partners, subject to obtaining all required regulatory approvals and the satisfaction of other customary conditions.
Read the article online at: https://www.tanksterminals.com/terminals/10122020/sempra-and-total-begin-phase-1-of-energia-costa-azul-lng-project/
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