Sempra, Bechtel Energy amend $10.5 billion agreement for Port Arthur LNG project
Published 12:36 am Friday, October 21, 2022
Sempra Infrastructure, a subsidiary of Sempra, announced Port Arthur LNG and Bechtel Energy have amended and restated the fixed-price engineering, procurement and construction contract for the proposed Phase 1 liquefaction project under development in Jefferson County.
The amended contract includes an updated price of approximately $10.5 billion.
Under the EPC contract, Bechtel will perform the detailed engineering, procurement, construction, commissioning, startup, performance testing and operator training activities for Phase 1 of the project.
The Port Arthur LNG Phase 1 project is permitted and expected to include two natural gas liquefaction trains and LNG storage tanks, and associated facilities capable of producing, under optimal conditions, up to approximately 13.5 million tonnes per annum of LNG.
A final decision on the ultimate local investment of Port Arthur LNG might not come until 2023, but the Bechtel agreement helps build optimism in the projected effort’s long-term success.
“We are excited to achieve this milestone with Bechtel. The execution of the final contract is a critical step in advancing Phase 1 of Port Arthur LNG toward a final investment decision,” said Justin Bird, CEO of Sempra Infrastructure.
“Based on robust customer interest, we know that Port Arthur LNG is highly attractive to the global market and we look forward to providing customers with access to secure, abundant and reliable U.S. LNG.”
Paul Marsden, President of Bechtel Energy, said the partnership with Sempra Infrastructure will deliver cleaner and more affordable energy to communities around the world.
“Alongside Sempra Infrastructure, Bechtel is ready to continue active construction in the Gulf Coast and bring more opportunities to the local region,” Marsden said.
Sempra Infrastructure President Dan Brouillette previously told Port Arthur Newsmedia that interest in the project is growing on a national and global scale.
“I think it is exciting for the people who live in Port Arthur, Texas, because there will be a bunch of jobs come that way,” he said of the proposed project. “It is exciting for us, as a company, because this is what we do for a living. It creates value for our owners and our shareholders. It is a great opportunity for Sempra Infrastructure, but it is a great opportunity for America.”
A similarly sized Port Arthur LNG Phase 2 project is also competitively positioned and under active marketing and development.
Earlier this year, Sempra Infrastructure announced the substantial completion of marketing for Phase 1 of the proposed Port Arthur LNG Project with the signing of a series of non-binding agreements with the Polish Oil & Gas Company (PGNiG), RWE Supply & Trading, INEOS Energy Trading Ltd. and ConocoPhillips.
Development of Phase 1 and Phase 2 of the Port Arthur LNG project is contingent upon completing the required commercial agreements, securing all necessary permits, obtaining financing, and reaching an affirmative final investment decision, among other factors.