The SPA would work on a free on board (FOB) basis, running for 15 years, and at a price based on Platts’ JKM.
The deals are subject to approval from regulators and an FID for Driftwood LNG.
Total’s chairman and CEO, Patrick Pouyanne, said the deals provided the company with improved access to Driftwood, “a highly cost-competitive project that benefits from the low gas production costs and prices in the US”.
The first phase of Driftwood LNG involves production of 16.6 million tpy, which may increase at a later date to 27.6 million tpy.
Total bought into Tellurian in 2017 with an investment of US$207 million.
In addition to its agreements with Tellurian, Total also announced a long-term sale and purchase agreement (SPA) with Guanghui International Natural Gas Trading. The Xinjiang-based company will take 700,000 tpy of LNG from Total’s global portfolio for 10 years, the French company said on April 3. Supplies will be delivered to Guanghui’s regasification terminal in Qidong, in Jiangsu Province.
Total’s vice president of gas, Laurent Vivier, welcomed the deal as the start of a long-term relationship with Guanghui. “This new supply contract is in line with Total’s strategy to expand its presence in the Chinese LNG market, which grew by over 41% in 2018 and will continue to be a key driver of the LNG markets growth in the future.”
Total will have around 40 million tpy of production in its portfolio by 2020, it said. In 2016, it managed 12.9 million tpy of LNG, by 2018 this had risen to 21.8 million tpy. The acquisition of Engie, in 2018, had a notable impact on the scale of its LNG operations. Trading last year reached 17.1 million tonnes, from 5.1 million tonnes in 2016.
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