Venture Global Lands Major 20-Year LNG Supply Deal With PETRONAS

Venture Global Inc. VG, a U.S.-based producer and exporter of natural gas, has signed a long-term sales and purchase agreement (SPA) with PETRONAS LNG, a subsidiary of the Malaysian state-owned energy firm, PETRONAS, for the purchase of 1 million tons per annum (mtpa) of liquefied natural gas (LNG). The SPA has a duration of 20 years. PETRONAS had previously signed an LNG supply deal with VG’s Plaquemines LNG facility.

Venture Global will deliver LNG under the contract from its CP2 LNG facility in Cameron Parish, LA. The CP2 LNG facility is situated close to the Calcasieu Pass LNG facility, another LNG facility developed by VG. The CP2 facility is currently under development. The LNG plant is anticipated to have 36 liquefaction trains. The facility shall also boast four 200,000-cubic-meter, full containment LNG storage tanks and two marine-loading berths. Venture Global has adopted a unique construction approach for its LNG projects, which involves using modular, factory-fabricated liquefaction units at its facilities. This method enables the LNG firm to streamline the construction process, thereby reducing the timelines and costs associated with it.

With this agreement, PETRONAS joins the growing list of global LNG buyers for the CP2 project. The project has a nameplate capacity of 14.4 million metric tons per annum (MMtpa),of which Venture Global has sold approximately 10.4 MMtpa to date. The CP2 project is significant to the United States as it can support the nation to uphold its position as the largest exporter of natural gas globally.

VG’s Zacks Rank & Key Picks

VG currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks from the energy sector are Flotek Industries Inc. FTK, Subsea7 S.A. SUBCY and Oceaneering International OII. While both Flotek Industries and Subsea7 sport a Zacks Rank #1 (Strong Buy) at present, Oceaneering International carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Flotek Industries specializes in green chemistry, which provides innovative solutions aimed at reducing the environmental impact of the energy industry. The company develops specialty chemicals tailored for both domestic and international energy producers, as well as oilfield service companies. These chemicals not only help reduce the environmental impact of hydrocarbon production but also lower operational costs.

Subsea 7 helps build underwater oil and gas fields. It is a leading player in the global offshore energy industry, providing engineering, construction and related services at offshore oil and gas fields. The long-term outlook for energy demand remains positive, and Subsea7’s focus on cost-efficient deepwater projects strengthens the position of its subsea business.

Oceaneering International delivers integrated technology solutions across all stages of the offshore oilfield lifecycle. The company is a leading provider of offshore equipment and technology solutions to the energy industry. OII’s proven ability to deliver innovative, integrated solutions supports ongoing client retention and new business opportunities, ensuring steady revenue growth.

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This article originally published on Zacks Investment Research (zacks.com).

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