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Driftwood LNG project agreements signed

Total and Tellurian have signed a series of agreements strengthening the partnership between the two companies to develop the Driftwood LNG project located in Louisiana, US.

Total is to make a $500mn equity investment in the Driftwood LNG development and purchase 1mn t/y of LNG from the proposed project. In addition, Tellurian and Total will also enter into a sales and purchase agreement (SPA) for a further 1.5mn t/y of LNG from Tellurian Marketing’s LNG offtake volumes from the Driftwood LNG. The SPA will be for the purchase of LNG free on board (FOB) for a minimum term of 15 years, at a price based on the Platts Japan Korea Marker (JKM).

Furthermore, Total will purchase around 20mn shares of Tellurian common stock for $200mn.

The agreements are subject to the relevant regulatory approvals and to the final investment decision (FID) for the Driftwood LNG project.

Driftwood LNG is an integrated LNG project that includes building gas pipelines from gas producing areas in Texas and a low cost modular concept liquefaction plant with a capacity of 16.6mn t/y (phase 1), which could be increased to 27.6mn t/y in subsequent phases. 

Total has been a shareholder in Tellurian since 2017, after the Group acquired approximately 46mn shares of Tellurian for $207mn. 

  • In other LNG news, Total and Guanghui International Natural Gas Trading Company have signed a long-term SPA for the supply of 700,000 t/y of LNG for a period of 10 years. The gas will be delivered to Guanghui’s regasification terminal in Qidong, Jiangsu Province, from Total’s global LNG portfolio.

    ‘This new supply contract is in line with Total’s strategy to expand its presence in the Chinese LNG market, which grew by over 41% in 2018 and will continue to be a key driver of the LNG markets growth in the future,’ comments Laurent Vivier, Senior Vice-President Gas at Total.

News Item details


Journal title: Petroleum Review

Region: North America

Countries: USA -

Subjects: Banking, finance and investment, Liquefied natural gas, LNG markets

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