Cheniere Energy Agrees to LNG Sale, Purchase Deal with Galp

Cheniere Marketing, a subsidiary of Cheniere Energy, signed a long-term LNG sale and purchase agreement (SPA) with Galp Trading. Under the SPA, Galp will purchase approximately 0.5 mtpa of LNG for 20 years on a free-on-board basis—the purchase price is indexed to the Henry Hub with a fixed liquefaction fee.

LNG deliveries, expected to begin in early 2030s, are subject to a positive FID on the second train (Train Eight) at the Sabine Pass Liquefaction Expansion Project (SPL Expansion Project). Galp will purchase a limited number of early LNG cargoes before Train Eight commences operation.

“We are pleased to enter into this long-term agreement with Galp, which reinforces the critical role U.S. natural gas is expected to play in Europe’s energy mix into the second half of this century,” said Jack Fusco, President and CEO, Cheniere Energy. “We look forward to providing flexible, reliable, and cleaner-burning LNG to Galp under this new agreement. This SPA is expected to provide further support for the SPL Expansion Project and demonstrates continued momentum as we progress project development.”

In February 2024, select subsidiaries of Cheniere Energy Partners submitted an application to the Federal Energy Regulatory Commission to site, build, and operate the SPL Expansion Project. They also sent an application to the Department of Energy, requesting authorization to export LNG to Free-Trade Agreement (FTA) and non-FTA countries. The SPL Expansion Project is being developed for up to 20 mtpa of LNG capacity.

News from Cheniere Energy

In late 2023, Cheniere Marketing signed a long-term LNG SPA with Foran Energy Group. According to the SPA, Foran Energy will purchase approximately 0.9 mtpa of LNG for 20 years, also indexed to the Henry Hub with a liquefaction fee.

News from Galp

In February 2024, Powin LLC and Galp partnered to install a utility-scale battery energy storge system (BESS) at a Galp solar power plant near Alcoutim, Algarve Region, Portugal. Galp operates several projects in the region with a combined capacity of 144 MW. The 5 MW/20 MWh battery system is Galp’s effort to hybridize its solar power production portfolio, which totals close to 1.5 GW in operation. The BESS will enable Galp to store solar energy produced during periods of high generation and deploy it in periods of high demand.

As part of Galp’s transformation strategy, the company has taken the FID and started construction works to build a large-scale electrolyzer to produce green hydrogen. In addition to the electrolyzer, Galp will build a 270 ktpa advanced biofuels unit.