Centrica signs £6.2bn LNG deal with US firm

Centrica has signed a 15-year deal with Delfin Midstream for the purchase of Liquefied Natural Gas (LNG).

Worth £6.2 billion, the agreement will see Centrica take delivery of around 14 LNG cargoes per year, which equates to about 1 million tonnes of LNG.

Located 40 nautical miles off the Louisiana coast, the Delfin Deepwater Port is the first floating LNG export facility in the US.

Chris O’Shea, Centrica chief executive, said the agreement was important to shore up the UK’s energy security.

He added: “This agreement is good news for our customers and the country. The last year has demonstrated the critical importance of investing in the UK’s energy security.

“Addressing the immediate impact of the energy crisis on our customers has been one of our biggest priorities, but I’m acutely aware that we also need to look ahead to manage future risks and secure our supplies.

“Natural Gas is an essential transition fuel in the move to net zero and securing international agreements such as this are vital to the UK’s energy security.

“As well as strengthening the trade links between the UK and US, this deal – alongside reopening Rough and our major deal with Equinor – shows that Centrica is investing heavily to future-proof the UK’s energy supply and address one of the underlying causes of the energy crisis. We stand ready to invest several billion pounds in additional projects, creating thousands of new UK jobs, with the right regulatory framework.”

Dudley Poston, chief executive of Delfin, added: “There is growing global demand for long-term, scalable LNG supply.”

Operations and first LNG are expected to commence at the Delfin Deepwater Port in 2027.

The government’s latest energy statistics show that US production made up nearly 70% of total LNG imports to the UK in the first quarter of the year.

Last month, Ofgem cleared the way for Centrica’s Rough storage facility to continue operations until at least 2030, after extending exemptions attached to its licence.

The exemption was due to come to an end in June 2024 but has now been extended until 2030.