Sempra Energy has announced that its subsidiaries IEnova and Sempra LNG & Midstream have signed three Heads of Agreements (HOAs) with affiliates of Total S.A., Mitsui & Co., and Tokyo Gas Co. for the full export capacity of Phase 1 of the Energía Costa Azul liquefied natural gas (ECA LNG) project located in Baja California, Mexico.
ECA LNG Phase 1 is a single-train liquefaction facility to be located adjacent to the existing LNG receipt terminal and expected to produce approximately 2.4 million tonnes per annum (Mtpa) of LNG for export to global markets.
“These three HOAs mark a significant milestone for the development of the ECA liquefaction export-project, supporting Sempra Energy’s strategic vision of becoming North America’s premier energy infrastructure company,” said Joseph A. Householder, President and Chief Operating Officer of Sempra Energy.
The three HOAs for ECA LNG Phase 1 contemplate the parties negotiating and finalising definitive 20-year LNG sales-and-purchase agreements. The three companies each will potentially purchase approximately 0.8 Mtpa of LNG from ECA LNG Phase 1. A final investment decision for ECA LNG is targeted in late 2019 with potential first LNG deliveries in 2023.
In June, TechnipFMC and Kiewit were selected as the engineering, procurement, construction and commissioning (EPC) contractor for the ECA LNG project, subject to reaching a definitive agreement on the EPC contract.
The ECA LNG receipt terminal was the first LNG receipt terminal constructed on North America’s West Coast. Located about 15 miles north of Ensenada, Baja California, it began commercial operations in 2008 and is capable of processing up to 1 billion cubic feet of natural gas per day.
In addition to the ECA LNG Phase 1 and 2 export projects, Sempra Energy is developing Port Arthur LNG export project in Texas and Cameron LNG Phase 1 and 2 export projects in Louisiana. Cameron LNG Phase 1 currently is under construction and Total and Mitsui are two of Sempra Energy’s joint-venture partners in the project.
Development of the ECA LNG Phase 1 and 2, Port Arthur LNG and Cameron LNG Phase 2 export projects are subject to a number of risks and uncertainties, including obtaining binding customer commitments, required regulatory approvals and permits, securing financing, completing the required commercial agreements and other factors, as well as reaching a final investment decision. The ultimate participation of Total, Mitsui and Tokyo Gas in the ECA LNG project remains subject to finalization of definitive agreements, among other factors.
For more information visit: www.sempra.com
8th November 2018
