Glenfarne Energy Transition LLC has inked a tentative tolling agreement with EQT Corp. as the U.S. natural gas production leader progresses its LNG exposure strategy.
Under the heads of agreement disclosed Thursday, EQT could have access to 0.5 million metric tons/year (mmty) in liquefaction services for 15 years from the first train at Glenfarne’s proposed liquefied natural gas facility in Brownsville, TX.
“This is an important milestone for Texas LNG, with additional agreements to be announced in the near-term as we progress towards a final investment decision (FID),” Glenfarne CEO Brendan Duval said.
Glenfarne has guided that it could reach FID and begin construction this year, placing delivery of first cargoes sometime in 2028.
Texas LNG is planned to be built in two 2 mmty phases that management has said will allow Glenfarne to reach a FID with a limited number of offtakers.
The potential agreement with Glenfarne is Pittsburgh-based EQT’s latest in a series of moves to increase its direct exposure to the massive wave of U.S. LNG export capacity additions that are expected to begin ramping up by the end of the year.
Combined with tentative agreements it signed for services at the proposed Commonwealth LNG and Lake Charles LNG, EQT could have direct export exposure for at least 2.5 mmty worth of natural gas. That’s more than 4% of its total current production exposure, according to NGI calculations.
EQT CEO Toby RIce said Texas LNG represents another opportunity to further its strategy of achieving “upside exposure and downside risk mitigation” as it looks to diversify routes for its Appalachian production portfolio.
“Our tolling capacity gives us direct connectivity to end users of natural gas globally, allowing for end-market structuring flexibility and superior downside protection,” Rice said.
Texas LNG regained approval from the Federal Energy Regulatory Agency last year – along with Rio Grande LNG – after a years-long legal battle with environmental groups. However, it still faces opposition from conservationists in court, including multiple pending cases in the U.S. Court of Appeals for the District of Columbia Circuit.Glenfarne is also developing the 8.8 mmty Magnolia LNG project in Lake Charles, LA. The firm filed a new application for non-Free Trade Agreement exports for Magnolia LNG late last year.
