- U.S.-based Venture Global LNG on Thursday announced a 20-year supply deal with China’s Sinopec.
- Venture Global CEO Mike Sabel told CNBC the deal is worth $30 billion.
- The deal also makes Venture Global the top American liquefied natural gas exporter to China.
U.S.-based Venture Global LNG announced on Thursday a 20-year supply agreement with China’s Sinopec, the largest long-term liquefied natural gas supply deal ever signed by an American company.
“Over the term of the contract, it is going to aggregate more than 80 million tons,” Venture Global CEO Mike Sabel told CNBC’s “Worldwide Exchange.” “On a dollar basis, that will eventually end up being over $30 billion for the life of the contract.”
The deal also makes Venture Global the top American LNG exporter to China. The company will deliver the product from its plant in Plaquemines, Louisiana.
“We’ve relentlessly focused on delivering the lowest possible delivered clean LNG to the market,” Sabel added. “That’s what our good friends and our customers at Sinopec in China were looking for.”
″[The deal] reflects the shared mission of Sinopec and Venture Global in promoting the global energy transition,” Sinopec President Ma Yongsheng said in a statement, stressing it’s a significant step in achieving carbon emission and neutrality goals.
The new Venture Global-Sinopec contract will double imports of U.S. liquefied natural gas to China — and at 4 million metric tons each year, it’s twice the size of a deal that Sinopec reached with Qatar earlier this year.
One of Venture Global’s priorities has been to try to control production efficiencies, Sabel said, adding it was a factor in making the Sinopec deal happen. “We think overall, relative to U.S. producers traditionally, we’ve probably shaved 30% off the cost,” he said. “Relative to some of the international projects, more than 50%.”
