ConocoPhillips to acquire 30% stake in Sempra’s Port Arthur LNG project

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ConocoPhillips on Thursday agreed to take a 30% stake in Sempra Energy’s proposed Port Arthur, Texas, liquefied natural gas (LNG) plant, advancing the long-delayed gas export project.

U.S. oil and gas producers this year have rushed to back projects to spur U.S LNG development and exports. Western sanctions on Russia have choked an already undersupplied market and put U.S. gas prices and exports into high gear.

Chevron last month agreed to buy 2 million tonnes per annum (mtpa) of LNG each from units of Cheniere Energy Inc and Venture Global LNG. Exxon Mobil separately is co-developing a 15.6-mtpa Louisiana plant.

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Financial terms of the preliminary, nonbinding agreement were not disclosed.

As part of the agreement, Conoco agreed to acquire 5 mtpa of the fuel produced by the project in its first phase, and would supply the natural gas for its share of output, the companies said.

Port Arthur LNG’s first phase would have two LNG trains, storage tanks and facilities capable of producing around 13.5 mtpa of LNG. Construction is forecast to start in mid-2025.

The agreement would allow Conoco to acquire a stake in the project’s second phase, which would bring total LNG capacity to about 27 mtpa. (Reporting by Rithika Krishna in Bengaluru; additional reporting by Gary McWilliams in Houston Editing by Vinay Dwivedi and Jonathan Oatis)