(Re-leads, adds detail and background on pricing, U.S. export
plant and trade trends)
PARIS/MILAN, March 28 France's GDF Suez
on Friday agreed its first long-term liquefied natural gas (LNG)
sales into Asia, signing a deal with Taiwan's state-run energy
firm CPC as regional demand for the commodity surges.
GDF Suez will deliver 800,000 tonnes of LNG per year to CPC
over a 20-year period starting in 2018. The gas will be sourced
from the proposed Cameron LNG plant in the United States where
the French energy giant owns 4 million tonnes of export capacity
The company has also signed other as-yet unannounced deals
to export U.S. LNG to companies in Japan, China and Chile among
others, which were first reported by Reuters in January.
"This sales agreement, the first of its kind, will
contribute to export natural gas - including shale gas -
produced in the U.S. - to the global LNG market," GDF Suez's
global gas and LNG head Jean-Marie Dauger said.
Countries across the world have been quietly signing deals
in recent months to import natural gas from the United States,
revealing a growing appetite for the fuel overseas as domestic
While Asian spot prices for LNG have hit record highs this
winter as demand outstrips supply, buyers of long-term volumes
are driving an increasingly hard bargain with sellers given the
surge of new supply due to emerge this decade from North
America, Australia and east Africa.
Long-term LNG supply deals currently being negotiated are
getting cheaper while industry sources say that GDF's deal with
CPC was done at barely breakeven levels.
According to the price formula reviewed by sources, CPC will
pay around $12 per million British thermal units for the gas in
the first year of the contract, a steep discount to the $16 it
pays for LNG prices in Asia linked to oil.
Japan's Mitsubishi and Mitsui, also with
export rights at Cameron, have separately targeted major buyers
such as Spain's Repsol, France's Total and
Japanese utilities. Mitsubishi is to sell a significant chunk of
LNG to its own trading arm in Singapore.
The Cameron LNG export project has received conditional
approvals from the U.S. Department of Energy and is likely to
gain final approval in the course of this year, GDF said.
GDF Suez says it is the main LNG importer in Europe and has
the third-largest LNG supply portfolio in the world, supplied
from six different countries. It controls a fleet of 14 LNG
carriers and has a significant presence in regasification
terminals around the world.
(Reporting by Geert De Clercq and Oleg Vukmanovic; editing by
William Hardy and Keiron Henderson)