LITGAS and Cheniere Marketing Sign Master Trade Agreement
The natural gas supply and trading company LITGAS, part of the Lithuanian state controlled Lietuvos Energija energy company group, on February 27 signed a master trade agreement to enable purchases of LNG from Cheniere Marketing, a subsidiary of Cheniere Energy. Cheniere Energy will open the first LNG export terminal in the U.S. in over 40 years later this year, first LNG expected to arrive in Lithuania as early as 2016.
“This agreement entered into with Cheniere is very important – the company is building the first U.S. natural gas liquefaction and export terminal which will be operational late 2015, and will provide us access to the prolific U.S. natural gas market”, General Manager of LITGAS Dominykas Tuckus said.
“We can begin receiving cargoes as early as 2016 to match demand”, he added.
The U.S. shale gas revolution in recent years has transformed the nation from one of a natural gas importer to one now able to export and provide LNG supply to global markets.
It is estimated that LNG projects already approved by U.S. authorities will increase global supply by over 30 billion cubic meters per year by 2018 – it compares to about 10 percent of current global LNG market. By comparison, the Baltic States consumes annually about 4 billion cubic meters.
This agreement provides LITGAS with supply and pricing diversity from a reliable counterparty.
LITGAS has 16 non-binding master trade agreements with companies supplying approximately half of world’s LNG and also has possibilities to buy natural gas from other Lithuanian importers.