EOG Resources entered into a long-term gas supply agreement with Cheniere Energy to supply its Corpus Christi, Texas, liquefaction facility.

Under the agreement, EOG will sell natural gas to Cheniere for 15 years beginning in early 2020. It will begin by supplying 140,000 MMBtu per day and increasing the amount to 440,000 MMBtu per day.

An LNG transport vessel. The first quantities will be owned and marketed by Cheniere and EOG will receive a price based on the Platts Japan Korea Marker (JKM). The remaining 300,000 MMBtu per day will be sold by EOG to Cheniere at a price indexed to Henry Hub.

Part of the deal hinges on a positive final investment decision on Cheniere’s Corpus Christi Stage III project. That project would include up to seven mid-scale liquefaction trains with a total expected aggregate nominal production capacity of approximately 9.5 mtpa. The project received a positive environmental assessment from the Federal Energy Regulatory Commission in March 2019 and is anticipated to receive all remaining regulatory approvals by the end of 2019.

In early September, Cheniere said that crews from general contractor Bechtel had completed the startup process for the second train of its Corpus Christi liquefied natural gas production (LNG) unit. Cheniere now has seven LNG production lines in operation, including five at its Sabine Pass export terminal in Louisiana and two at its Corpus Christi location. Crews began introducing natural gas into the system in March and the first export shipment was sent in July.

Train 2's customers include utility companies and natural gas companies in France, Spain, Indonesia and Singapore. Commercial deliveries are expected to begin in May 2020.