Mexico Pacific signs 20-year LNG deal with ConocoPhillips
07 August 2023
LNG demand growing, says ConocoPhillips
Mexico Pacific and ConocoPhillips have signed sales and purchase agreements for ConocoPhillips to offtake approximately 2.2 million tons per year (MTPA) in aggregate of liquefied natural gas (LNG) over 20 years.
The agreement covers trains 1, 2 and 3 of Mexico Pacific’s anchor LNG export facility, Saguaro Energia, located in Puerto Libertad on the west coast of Mexico. ConocoPhillips also has an option to contract further expansion train volumes. Under the sales and purchase agreements, ConocoPhillips will purchase LNG on a free on-board basis over a term of 20 years. When fully operational, the first phase of the facility will have three trains with a combined capacity of 15 MTPA.
“ConocoPhillips is excited to pursue this opportunity with Mexico Pacific as we continue to focus on LNG market development to meet growing global natural gas demand,” said Bill Bullock, executive vice president and CFO. “LNG is a fuel that is crucial to providing reliable, lower-carbon energy for the long term. Expanding our LNG footprint with agreements like this further enhances a balanced, diversified, and attractive portfolio as we progress our global LNG strategy.”
“We’re proud to be the first project to have an initial FID independently anchored by three majors,” said Sarah Bairstow, president and CCO at Mexico Pacific. “This unprecedented market milestone is a testament to our compelling ability to bridge competitive Permian Gas with the largest LNG market, Asia, free of Panama Canal risk and unnecessary incremental shipping emissions and costs when compared to the US Gulf Coast. While trains 1 and 2 sales are now closed, we remain committed to providing further LNG supply to meet global energy security and energy transition needs and will now turn to execute against the contracting momentum in place for a subsequent train 3 FID as quickly as possible.”