Chevron in Chinese deal for LNG deliveries

Chevron made further progress with its Australian liquefied natural gas developments by landing a 10-year agreement to supply the Chinese market.

Chevron signed a non-binding 10-year agreement with ENN LNG Trading Co. for the delivery of about 500,000 metric tons of LNG sourced from the Gorgon project in Australia.

"This is one more step in the development of our Australian gas business and our global LNG portfolio," Mike Wirth, a Chevron vice president in charge of delivery options, said in a statement. "It also represents further progress with new LNG buyers in China who are poised to transform the LNG landscape in that country."

The deal is the second for Chevron in the Chinese market since December, when it signed with China Huadian Green Energy for the delivery of up to 1 million metric tons of LNG per year over 10 years, starting in 2020.

Chevron announced last week it started the processes necessary to cool gas to temperatures low enough to convert it to liquid form for widespread delivery from the Gorgon project in Australia, the largest single-resource development in the nation's history.

Chevron's Gorgon project will eventually produce 15.6 million tons of LNG per year.

ENN LNG Trading Co. is one of the largest gas distribution companies in China. Deliveries from Gorgon are expected as early as 2018.