The Williams Companies ( WMB Quick Quote WMB - Free Report) recently announced that it entered into a non-binding head of agreement (HOA) with the North American energy infrastructure company, Sempra ( SRE Quick Quote SRE - Free Report) . The agreement establishes the elements of an assimilated platform to connect the Haynesville Basin to the rising LNG export demand along the Gulf Coast and worldwide.
Per Williams, the HOA contemplates negotiating a long-term gas sales deal of about 0.5 billion cubic feet per day (Bcf/d) delivered near Gillis, LA. Further, two LNG offtake agreements totaling 3 million tons per annum from Sempra’s proposed Cameron LNG Phase 2 and Port Arthur LNG projects are likely to be negotiated.
As part of the proposed deal, the firms will form a joint venture to own, expand and operate the 2.35 Bcf/d Cameron Interstate pipeline and the 2 Bcf/d Louisiana Connector pipeline.
The Cameron Interstate pipeline is anticipated to deliver natural gas to the proposed Cameron LNG Phase 2 in Louisiana. Meanwhile, the Louisiana Connector pipeline is likely to supply to Port Arthur LNG in Texas.
Moreover, per Williams, this transaction will complement its recently approved low-carbon Louisiana Energy Gateway (“LEG”) gathering project. Anticipated to go into service in late 2024, the LEG project will gather 1.8 Bcf/d of natural gas produced in the Haynesville Basin.
Alan Armstrong, the president and CEO of Williams, stated that his company is pleased to move ahead in this partnership with Sempra. “We see it as an opportunity to combine our capabilities along the natural gas value chain and increase the delivery of low-carbon, affordable and reliable natural gas from the wellhead to the growing international market,” he added.
Sempra Energy is a Southern California-based energy services holding company involved in selling, distributing, storing and transporting electricity and natural gas. Formed in 1998, Sempra Energy invests in, develops and operates energy infrastructure.
Founded in 1908, The Williams Companies, Inc. is a premier energy infrastructure provider in North America. Its core operations include finding, producing, gathering, processing and transporting natural gas and natural gas liquids.
Moreover, WMB boasts a widespread pipeline system of more than 33,000 miles of pipelines. Williams is one of the largest domestic transporters of natural gas by volume.
Williams currently carries a Zacks Rank #2 (Buy). Some other top-ranked stocks from the energy space that warrant a look include
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