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Poland’s PGNiG to buy more US LNG from Venture Global, ends Port Arthur deal

Poland’s state-controlled PGNiG has agreed to buy a further 2 million mt/year of LNG from US supplier Venture Global, bringing its total contracted volume with the company to 5.5 million mt/year, it said July 27.

At the same time, PGNiG said it had terminated a supply deal for 2 million mt/year of LNG from the US Port Arthur facility due to project delays, and had signed a new memorandum of understanding with Sempra for a potential replacement of those volumes from Sempra’s other projects in North America.

PGNiG is looking to US LNG to help meet increased gas demand in Poland as well as to eliminate the need for Russian pipeline gas imports.

“LNG plays a vital role in PGNiG’s strategy — it is a key component of our supply portfolio diversification and the plan to reinforce the energy security of our customers,” PGNiG chief commercial officer Pawel Majewski said in a statement.

“Moreover, based on LNG, we plan to develop our commercial activity in the global trading market. Expanding our cooperation with Venture Global LNG fits in with both of these goals,” he said.

PGNiG said it had signed agreements with Venture Global Calcasieu Pass and Venture Global Plaquemines to purchase another 2 million mt/year of LNG for 20 years.

“As a result, the volume of LNG contracted from Venture Global LNG by PGNiG is to increase to 5.5 million mt/year.”

The agreements are another step toward increasing the volumes contracted in 2018 and 2019.

Instead of 1 million mt/year, PGNiG intends to purchase 1.5 million mt/year from the under-construction Calcasieu Pass facility, while the Plaquemines contracted volume is to be increased from 2.5 million mt/year to 4 million mt/year.

“When both PGNiG/Venture Global sales and purchase agreements are amended, PGNiG will be purchasing from Venture Global 5.5 million mt/year of LNG,” it said.

The agreements are on a free on board (FOB) basis and commercial deliveries from Calcasieu Pass are expected in early 2023.

Port Arthur deal

PGNiG also said it had decided to terminate its supply agreement with Port Arthur LNG for 2 million mt/year of LNG supply “due to delays in the project’s development.”

“Simultaneously PGNiG and Sempra signed an MOU for a potential replacement of approximately 2 million mt/year of LNG supplied from Sempra LNG’s portfolio of projects in North America,” it said.

Majewski said the MOU allowed for “shifting the volumes originally contracted at Port Arthur LNG to other facilities from Sempra LNG’s projects portfolio.”

As part of the MOU, Sempra LNG and PGNiG will also work toward a framework for the reporting, mitigation and reduction of greenhouse gas emissions throughout the LNG value chain.
Source: Platts

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