Chesapeake Energy Corporation (NASDAQ: CHK, together with certain of its subsidiaries, collectively, "Chesapeake"), Delfin LNG LLC ("Delfin") and Gunvor Group Ltd, through Gunvor Singapore Pte Ltd ("Gunvor"), today announced the entrance into a liquefied natural gas (LNG) export deal that includes executed Sales and Purchase Agreements ("SPA") for long-term liquefaction offtake.
Under the SPA, Chesapeake will purchase approximately 0.5 million tonnes ("mtpa") of LNG per annum from Delfin at a Henry Hub price and contract targeted start date in 2028 then deliver to Gunvor on an FOB basis with the sales price linked to the Japan Korea Marker ("JKM") for a period of 20 years. These volumes will represent 0.5 mtpa of the previously announced up to 2 mtpa HOA with Gunvor.
Nick Dell'Osso, Chesapeake President and CEO, said, "Today's announcement cements an important step on our path to 'Be LNG Ready' and is further recognition of the depth of our portfolio and strength of our financial position. We are pleased to formalize our agreement which provides diversification and access to global LNG pricing while enabling the delivery of affordable, reliable, lower carbon energy to markets in need."
Dudley Poston, Delfin CEO, said: "We are excited to partner with a premier company like Chesapeake. We believe our unique liquefaction solution provides Chesapeake with commercial flexibility with a reduced environmental footprint, while providing a much-needed source of additional supply to key US allies and the global LNG market."
Kalpesh Patel, Co-Head of LNG Trading and a member of the Executive Committee of Gunvor, said, "This deal represents an important step in finalizing the 0.5 mtpa out of our total of 2.0 mtpa arrangement with Chesapeake, while expanding our existing cooperation with Delfin. We continue to provide reliable and competitive logistics services to our partners by utilizing our fleet consisting of vessels procured via term charters and equity ownership. Gunvor looks forward to establishing additional agreements with the companies in the near future."