Tellurian Inc (NASDAQ: TELL) Finalizes Agreement With Shell NA LNG

Tellurian Inc (NASDAQ: TELL) announced on July 29 that it is in the final leg of sale and purchase agreements regarding liquefied natural gas (LNG) with Shell NA LNG. These agreements are on FOB or free onboard basis at the Driftwood LNG. The agreements are meant for ten years and allow for a combination of three million tonnes per annum (mtpa). The SPAs are according to two combination indices, i.e., Dutch Title Transfer Facility (TTF) and Japan Korea Marker (JKM), netted back for the transportation charges. The agreement testifies to the third deal that the company has finalized in ten weeks. The total capacity of the first two plants of Driftwood LNG comes up at nine mtpa now. 

Shell-Tellurian Partnership

Octávio Simões, the CEO and President of the company said that Shell is an excellent company to onboard on Tellurian’s Driftwood project since it is among the world’s largest and most diversified LNG portfolios. In addition, shell leads the LNG industry in delivering LNG cargoes based on CO2e neutral. Furthermore, owing to the integrated project of Driftwood, the company’s ability in measuring emissions of loading arm while also reducing them will further allow for CO2e neutral LNG offering from Shell. 

Meanwhile, the EVP Shell Energy, Steve Hill, said that the demand for LNG is anticipated to double up by 2040. The inclination of the world towards cleaner energy sources is driving the demand for such alternatives. The government support for reducing carbon footprints is also a favorable factor. 

The deal offers a competitive advantage by securing volume for the portfolio by the mid-2020s, said Steve Hill. This deal also enables Shell to provide flexible and diverse LNG supply to the customers. The SPAs, Simões added, have made complete Tellurian sales that support the launching of two plants. The company shall now emphasize financing its Driftwood project to proceed with the construction work at the beginning of next year.  

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