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Santos Expands LNG Portfolio With Posco Supply Deal, Ksi Lisims Offtake Agreement

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Australian energy giant Santos said Tuesday that it has agreed to two separate non-binding liquefied natural gas arrangements aimed at expanding and diversifying its global portfolio.

This includes one with Posco Steel for the supply of LNG over a 10-year period, with deliveries expected to begin in 2030 or 2031.

Under the terms of the agreement, Santos would supply LNG sourced from its diversified global portfolio to Posco on a delivered ex-ship basis, which means the seller handles all transportation costs, while also assuming the risks that come with it.

Besides this, the company entered into a similar non-binding agreement with Western LNG and its partners to purchase 1 million tonnes of LNG annually from the proposed Ksi Lisims LNG project in British Columbia, Canada.

This agreement is set to run for up to 20 years, with supply expected to begin around 2031 on a free-on-board basis, which means Santos will handle all the costs and assume the risks of transportation.

Santos said the Ksi Lisims supply would complement its existing LNG portfolio in Papua New Guinea and Australia, allowing it to increase LNG sales volumes without a corresponding rise in upstream capital investment.

"Ksi Lisims gives us access to a high-quality, competitive cost of supply of LNG that complements our equity production," Santos' MD and Chief Executive Officer Kevin Gallagher said.

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Commodities

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Commodities

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