Centrica signs UK’s first deal for US shale gas exports

25 March 2013 13:17  [Source: ICIS news]

LONDON (ICIS)--Centrica has signed the UK’s first contract for the import of shale gas from the US in a £10bn ($15bn, €12bn) deal with Cheniere Energy that should over 20 years deliver 1.75m tonne/year of gas from 2018, the UK-based energy company said on Monday.

The trade has been made possible by the issuing of US federal government permits that mean Houston-based Cheniere is one of the first American companies to have clearance to export natural gas converted into liquefied natural gas (LNG).

The LNG, to be purchased on a FOB (free on board) basis following processing at Cheniere’s planned fifth liquefaction train in Cameron Parish, Louisiana, will be enough to meet the annual gas demand of around 1.8m UK homes, Centrica said.

Sam Laidlaw, chief executive of Centrica, said: “In an increasingly global gas market, this landmark agreement represents a significant step forward in our strategy, enabling Centrica to strengthen its position along the gas value chain and helping to ensure the UK’s future energy security. We are therefore very pleased to have signed this agreement and look forward to working with Cheniere.”

UK Prime Minister, David Cameron, welcomed the commercial agreement. “Future gas supplies from the US will help diversify our energy mix and provide British consumers with a new long-term, secure and affordable source of fuel."

UK Secretary of State for Energy and Climate Change, Ed Davey, said: “Security of UK energy supply lies in diversity so I am pleased that Centrica has announced today that it has secured a long-term North American liquefied natural gas export contract with Cheniere Energy Partners. The UK already receives gas from a range of countries and we can now add the US to Norway, the Netherlands and Qatar as sources of supply.”

($1 = £0.66, €1 = £0.85)

By: Will Conroy
+44 20 8652 3214

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