ExxonMobil, Mexico Pacific to bring Permian gas to global markets with third LNG deal
(WO) – Mexico Pacific has signed a third long-term Sales and Purchase Agreement (“SPA”) with ExxonMobil LNG Asia Pacific (“EMLAP”) for an additional 1.2 MMtpa of liquefied natural gas (“LNG”) from Train 3 of Mexico Pacific’s Saguaro Energia project located on the west coast of Mexico.
The volume originates from the option under the separate LNG SPAs executed in January 2023, covering volumes from Trains 1 and 2. Under the Train 3 LNG SPA, EMLAP will purchase LNG on a free-on-board basis over a 20-year term. There is also an option for another 1 MTPA from Train 4.
“We are pleased to announce this additional long-term SPA with ExxonMobil, extending our much-valued partnership into Train 3”, said Ivan Van der Walt, CEO Mexico Pacific. “While we remain focused on initially taking FID on Trains 1 and 2, this latest LNG SPA with ExxonMobil concludes the LNG sales required for a subsequent Train 3 FID expected this year. With key contracting and permits in place across the terminal and pipeline, we are well positioned to sanction the project, connecting Permian basin gas with the world’s largest LNG markets in Asia to provide reliable and cost-effective LNG to support the energy transition.”
“Bringing additional North American LNG to global markets advances energy security and helps to lower emissions in many countries with high energy demand,” said Peter Clarke, ExxonMobil’s Head of Global LNG and Senior Vice President. “Long term contracts play an essential role in underpinning the investments that will be required to advance the energy transition. We look forward to working with Mexico Pacific to continue growing our portfolio and deliver Permian natural gas to global markets.”
Mexico Pacific’s anchor project, the 15 MMtpa Saguaro Energia LNG Facility, is the most advanced LNG development project on the West Coast of North America. The Saguaro Energia LNG Facility achieves significant cost and logistical advantages resulting in the lowest landed price of North American LNG into Asia by leveraging low-cost natural gas sourced from the nearby Permian basin, and a significantly shorter shipping route avoiding Panama Canal transit risk for Asian markets.
