Commonwealth LNG today announced a significant stride towards the realization of its 9.5 million tonnes per annum (Mtpa) liquefied natural gas (LNG) export facility in Cameron, Louisiana, by signing a 20-year Sale and Purchase Agreement (SPA) with JERA Co Inc. This pivotal agreement sees Japan's largest power generation company and a leading global LNG buyer committing to purchase 1 Mtpa of LNG from Commonwealth's facility, underscoring the growing international demand for responsibly produced U.S. natural gas.
The signing of this SPA brings Commonwealth LNG's total long-term offtake agreements to 4 Mtpa, placing the company firmly on track to finalize its commercial book. This crucial step precedes a targeted final investment decision (FID) in the third quarter of 2025, with anticipated first LNG production slated for 2029. The partnership with JERA, a titan in the global energy landscape, not only validates Commonwealth's project but also highlights its commitment to delivering low-cost energy with a minimal carbon footprint.
Ben Dell, Managing Partner of Kimmeridge and Chairman of Commonwealth LNG, expressed enthusiasm for the collaboration, stating, "We look forward to our partnership with JERA, a recognized global energy leader who shares our commitment to low-cost energy with the lowest carbon footprint." This sentiment was echoed by Commonwealth President and CEO Farhad Ahrabi, who added, "We are delighted to be partnering with JERA, considering their prominent role and extensive experience along the full LNG value chain. As we move forward to FID and commercial operations, we look forward to building on our relationship with them."
The Commonwealth export facility is poised to be a significant economic catalyst for Louisiana, with projections indicating approximately $11 billion in total investments. Furthermore, the project is expected to generate an estimated $3.5 billion in annual export revenue, bolstering the state's economy for years to come. During the peak of construction, the facility is projected to create approximately 2,000 jobs, providing substantial employment opportunities. Once operational in 2029, it will sustain approximately 275 high-paying permanent positions, contributing to long-term economic stability and growth in the region.
Commonwealth LNG is owned by Kimmeridge SoTex Holdco LLC, an entity founded by Kimmeridge, an asset manager specializing in the energy sector. Through SoTex, which also encompasses Kimmeridge Texas Gas, an upstream natural gas development company, Kimmeridge is spearheading the development of America's first integrated gas independent. This innovative approach aims to deliver low-cost natural gas directly from the wellhead to the water, effectively meeting the burgeoning global demand for responsibly produced LNG.
The SPA's full effectiveness is contingent upon the satisfaction of customary conditions, including a crucial affirmative final investment decision on the project.
