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France’s energy giant TotalEnergies has inked a heads of agreement (HoA) with China Petrochemical Corporation (Sinopec) for a multi-year sale of liquefied natural gas (LNG).
The deal to deliver 2 million tons annually (mtpa) of LNG for 15 years, starting in 2028, is said to be in line with the French player’s strategy to grow its LNG business, giving it access to what is said to be the largest market in the world.
The deal comes on the heels of the strategic cooperation contract the two players signed during President Xi Jinping’s state visit to France in May, when they agreed to explore new opportunities and combine research and development (R&D) expertise in biofuels, green hydrogen, carbon capture, utilization and storage (CCUS), and decarbonization.
“We are delighted to have been chosen by Sinopec to supply 2 million tons of LNG to China, the largest LNG importing country in the world. This new agreement demonstrates the competitiveness of TotalEnergies’ LNG business and allows us to continue growing our long-term sales in Asia,” said Stéphane Michel, President of Gas, Renewables & Power at TotalEnergies.
Natural gas is thought to be a crucial component of China’s energy transition as it offsets the intermittency of rapidly growing renewable energies and helps slash greenhouse gas emissions by replacing coal in electricity production.
Sinopec’s Senior Vice President, Niu Shuanwen, noted: “Sinopec and TotalEnergies are strategic partners. This HoA further strengthens the cooperation between the two companies in natural gas. Natural gas is an important enabler for realizing energy transition and dual carbon goals. Sinopec is committed to building the world’s leading clean energy and chemical company and will continue to promote energy transition and the clean, diversified and secure supply of energy. Sinopec strives to make positive contributions to global energy governance and climate change.”
In September, TotalEnergies secured a five-year extension of its LNG deal with another Chinese player, the state-owned China National Offshore Oil Corporation (CNOOC), to deliver 1.25 million tons of LNG per year to China until 2034.
Apart from LNG-related deals, the French giant’s Danish subsidiary is inching closer to increasing output at Tyra II, its natural gas redevelopment project in the Danish sector of the North Sea. The firm expects to reach full technical capacity between November 5 and 15.
TotalEnergies also discovered 48 meters of net gas condensate pay during recent drilling operations with the Shelf Drilling Winner jack-up rig at a well in the Harald East area. The well, which will be connected to the existing Harald and Tyra facilities, is anticipated to start producing before the year’s end. |
