Oil & Gas

June 2024 witnessed significant activity in the liquefied natural gas (LNG) sector, with Saudi Aramco leading the charge by securing major long-term export agreements. LNG, known for being a reliable energy source that aligns with global climate goals for carbon neutrality, is becoming an essential transition fuel.

Despite being relatively new to the global LNG market, Saudi Aramco topped the list of the top 5 LNG deals in June 2024 by finalizing two 20-year agreements. Alongside Saudi Aramco, other major companies on the list include Qatar Energy, Shell, and TotalEnergies, according to a monthly report by a Washington-based specialized energy platform.

Aramco Leads the Top 5 LNG Deals.

1. Saudi Aramco and Next Decade Corporation

• Date: June 13, 2024
• Details: Saudi Aramco signed a 20-year non-binding agreement with Next Decade Corporation to purchase 1.2 million tonnes per year of LNG from Unit IV at the Rio Grande LNG facility in Texas.
• Significance: This deal secures a long-term LNG supply for Aramco, priced at the Henry Hub Gas Price Center.

2. Saudi Aramco and Sempra

• Date: June 26, 2024
• Details: Aramco signed another 20-year non-binding agreement with Sempra for the sale and purchase of 5 million tonnes per year of LNG from the Port Arthur LNG project's second phase.
• Significance: The agreement includes a 25% stake for Saudi Arabia in the second phase of the project, with plans to finalize a binding agreement.

Other Key Deals in June 2024

3. Qatar Energy and CPC Corporation Taiwan

• Details: Qatar Energy signed a deal with CPC Corporation Taiwan to supply 4 million tonnes of LNG annually for 27 years from the North Field Expansion Project.
• Significance: This agreement positions Qatar Energy as a leading global LNG exporter and supports its expansion plans to reach a production capacity of 142 million tonnes per year by 2030.

4. TotalEnergies' Agreements with Indian Oil Corporation (IOCL) and Korea Southeast Power

• Details: TotalEnergies secured two deals: a 10-year agreement to supply 800,000 tonnes per year of LNG to IOCL starting in 2026, and a 5-year agreement to supply 500,000 tonnes per year to Korea Southeast Power starting in 2027.
• Significance: These deals provide long-term outlets for TotalEnergies' LNG production and strengthen its market presence.

5. Shell's Acquisition of Pavilion Energy

• Details: Shell acquired Pavilion Energy, a Singaporean LNG trading company, from Temasek International. The deal includes supply contracts for 6.5 million metric tonnes per year from suppliers like Chevron, BP, and Qatar Energy.
• Significance: This acquisition increases Shell's LNG production capacity from 28 million tonnes to around 39 million tonnes, enhancing its market presence in Europe and Singapore.

These significant deals highlight the strategic importance of LNG as a transitional energy source, balancing reliability with climate goals, and ensuring energy security in the global market.