UK-based energy company Centrica has signed a deal to purchase one million tonnes per year of liquefied natural gas (LNG) from US exporter Delfin Midstream. The 15-year deal contracts shipments from the Delfin Deepwater Port, located 40 nautical miles off the coast of Louisiana, US, to the UK.
The long-term sale and purchase agreement will see Centrica take delivery of approximately 14 LNG cargoes per year and could provide enough energy to heat 5% of UK homes for 15 years, the company announced in a press release.
Centrica hopes the deal, which has an estimated market value of $8bn (£7bn), will build further resilience in the UK’s energy security.
Centrica CEO Chris O’Shea said: “As well as strengthening the trade links between the UK and US, this deal – alongside reopening Rough [gas storage facility] and our major deal with Equinor – shows that Centrica is investing heavily to future-proof the UK’s energy supply.”
The three-year supply agreement with Equinor will see the Norwegian oil major supply an additional one billion cubic feet (bcf) of natural gas per year to the UK. The move also follows the reopening of the Rough gas storage facility under the North Sea in October 2022. The Rough facility now provides half of the UK’s total gas storage capacity with the potential to store more than 50 billion cubic feet of gas.
“Addressing the immediate impact of the energy crisis on our customers has been one of our biggest priorities, but I am acutely aware that we also need to look ahead to manage future risks and secure our supplies,” O’Shea added. “We stand ready to invest several billion pounds in additional projects, creating thousands of new UK jobs, with the right regulatory framework.”
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Delfin CEO Dudley Poston said in a statement that he hopes the deal will advance the company’s position as a leading source of low-cost energy. “Market demand for long-term LNG continues to be strong and buying activity from Europe and various other geographies has accelerated over the past few months,” he added.