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Saudi Aramco (ARMCO) is in talks with Commonwealth LNG for 2M metric tons/year of supply from the U.S. company’s proposed facility in Louisiana, as it seeks to strengthen its position in the market for liquefied natural gas, Reuters reported Wednesday.
If a deal is struck, it would bring Commonwealth LNG closer to the 8M tons/year it plans to sell out of the plant’s capacity of 9.5M tons/year; so far, the company has 4M tons/year in signed sales and purchase agreements, and one non-binding heads of agreement deal for 1M tons/year.
Commonwealth LNG has been attempting to build the first U.S. integrated LNG export facility; it has said it plans for a financial investment decision on construction of the plant by the end of this year.
Aramco (ARMCO) is seeking to expand its fast-growing portfolio of LNG supply, especially in the U.S., and already has signed deals with other U.S. players, including NextDecade’s Rio Grande LNG.
The Saudi giant also is looking at other U.S. LNG export projects including Delfin LNG, which wants to build a 13.2M tons/year floating LNG plant in the Gulf of Mexico, and Energy Transfer’s (NYSE:ET) proposed 16.5M tons/year Lake Charles, Louisiana, facility, Reuters reported.