British Gas owner Centrica has signed a mega US deal to ramp up its supplies of liquefied natural gas (LNG) processed in a floating export facility 40 miles off the coast of Louisiana.
It has unveiled a £7bn deal with Delfin Midstream (Delfin) to buy a million tonnes of LNG on an annual basis, over a 15-year window.
This will help shore up the UK’s supply security during the transition to net zero and global volatility with stable flows of gas.
The agreement will see the British Gas owner purchase supplies from extracted and processed from the Delfin Deepwater Port.
Delfin is planning to develop the first floating LNG export facility in the US by the end of this year, which will operate within the port and convert natural gas.
The deal with Centrica provides Delfin with another key foundation customer for its final investment decision, with operations expected to commence in 2026.
Supply security has been a key concern for energy suppliers across the globe following Russia’s invasion of Ukraine and resurgent post-pandemic demand.
Last month Centrica signed an additional £4bn supply agreement with Norwegian energy giant Equinor to supply 4.5m UK homes through to 2025.
Centrica hopes £7bn agreement with Delfin, which starts in 2026, will boost the expansion of US LNG export capacity – which it sees as an increasingly important source of stable, reliable future gas supply.
Business Secretary Kwasi Kwarteng praised the deal, and argued it was vital to secure energy supplies to meet the country’s energy needs from reliable partners.
He said: “From renewables to nuclear, we have ambitious plans for greater energy independence, but we are also realistic about our energy needs now and in the years ahead. That means we need to secure more diverse and reliable sources of natural gas from friends, allies and strategic partners. Today’s deal between Centrica and Delfin is positive news for the UK, helping to ensure our diversity of supply from reliable sources – like our friends in the United States – for many years to come.”