A subsidiary of Oklahoma City-based Chesapeake Energy just reached a 15-year deal to supply 2 million tons of LNG a year to a Singapore based company. The supply of LNG will come from the natural gas produced by Chesapeake Energy and its operations in Louisiana.
The Heads of Agreement with Gunvor Singapore Pte Ltd was reached with Chesapeake Energy Marketing LLC. The announcement explained that following the execution of the agreement, Chesapeake and Gunvor will jointly select the most optimal liquefaction facility in the U.S. to liquify the gas produced by Chesapeake and deliver the LNG to Gunvor on a Free-on-Board Basis with a targeted start date in 2027.
“This agreement reflects the powerful combination of the premium rock, returns, and runway of our competitively positioned Haynesville natural gas assets combined with the strength of our balance sheet and financial position to securely supply global LNG markets,” said Nick Dell’Osso, Chesapeake President and Chief Executive Officer.
“Today marks an important initial step on our path to being LNG ready and we look forward to entering into additional agreements while export capacity continues to come online.”
Kalpesh Patel, Co-Head of LNG Trading and a member of Gunvor’s Executive Committee said the deal will further enhance the company’s global LNG portfolio.
“We believe our trading expertise together with our robust shipping fleet will not only contribute to the competitive shipping costs, but also ensure reliable offtake operations for Chesapeake and the liquefaction facility which we will jointly select. We very much look forward to the long-term relationship with Chesapeake.”
