San Diego utility company Sempra Energy and Japanese industrial conglomerate Mitsui & Co. have entered into a memorandum of understanding to expand Cameron LNG in Calcasieu Parish.
The two companies are part of a consortium building three liquefied natural gas production units during the first phase of development at the LNG export terminal in southwest Louisiana. Under the memorandum, the companies have agreed to help each other build two more production units as part of a phase 2 expansion.
The agreement also spells out plans for future expansion of the Energía Costa Azul (ECA) LNG project in Baja California, Mexico.
“This agreement signals continued momentum in the growing U.S. liquefied natural gas (LNG) export market, while reinforcing the unique competitive advantage that Sempra offers customers seeking LNG export capabilities from the Gulf Coast, as well as the West Coast of North America,” said Justin Bird, president of Sempra LNG. “We are pleased to expand our relationship with Mitsui and advance the development of both LNG projects.”
The MOU is non-binding and contemplates the continued mutual support for the development of Cameron LNG Phase 2, including Mitsui’s purchase of up to one-third of the available capacity of the project, as well as the potential offtake of approximately 1 million tons per year of LNG and equity participation in a future expansion of ECA LNG.
Train 1 of the Cameron LNG Phase 1 project started commercial operations in August 2019. Trains 2 and 3 are expected to begin LNG production in the first quarter and second quarter of 2020, respectively. Cameron LNG Phase 2, which has all necessary permits from the Federal Energy Regulatory Commission, encompasses up two additional liquefaction trains and up to two additional LNG storage tanks. Mitsui is also an equity owner of Cameron LNG LLC, the development company for Cameron LNG Phase 1 and Phase 2.
Development of Sempra Energy’s LNG export projects is contingent upon obtaining binding customer commitments, completing the required commercial agreements, securing all necessary permits, obtaining financing and reaching final investment decisions, among other factors.