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ConocoPhillips Strikes 20-Year LNG Deal With Sempra's Port Arthur
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Key Takeaways
ConocoPhillips signed a 20-year LNG supply deal with Sempra's Port Arthur Phase 2 project in Texas.
The deal covers 4 MTPA of LNG, with shipments to Europe and Asia under a free-on-board contract.
COP adds to its 2022 Phase 1 deal, further expanding its LNG portfolio and global supply flexibility.
ConocoPhillips (COP - Free Report) has strengthened its position in the global liquefied natural gas (LNG) market by announcing a major supply agreement with Sempra Infrastructure. Under the deal, the Houston-based oil and gas producer will purchase 4 million tons per annum (MTPA) of LNG from Sempra’s Port Arthur LNG Phase 2 project in Texas over a 20-year term. The contract, structured on a free-on-board basis, is intended to serve growing global demand with shipments directed to key markets in Europe and Asia.
Ryan Lance, Chairman and CEO of ConocoPhillips, emphasized that the agreement reflects the company’s long-term commitment to LNG. He noted that the deal strengthens ConocoPhillips’ ability to build a flexible and reliable supply network, positioning the company to meet rising demand while reinforcing energy security in an evolving global market.
Per a Reuters report, the deal comes as commercial activity in the U.S. LNG sector accelerates following the lifting of a moratorium on new export permits earlier this year by President Donald Trump. According to the U.S. Energy Information Administration, the United States is already the world’s largest LNG exporter, and export capacity is expected to reach 115 million metric tons per annum before the end of 2025.
Jeffrey Martin, CEO of Sempra, highlighted the global significance of the expansion by pointing out that U.S. LNG is playing an increasingly vital role in meeting the energy security requirements of America’s allies. He also emphasized that the Port Arthur project will strengthen connections between U.S. producers and international markets while driving economic growth domestically.
This latest agreement builds on a long-standing relationship between ConocoPhillips and Sempra Infrastructure. In 2022, the company signed a 20-year deal for 5 MTPA of LNG offtake from Port Arthur Phase 1 and acquired a 30% equity stake in that project, which is slated to begin operations in 2027. By adding the Phase 2 volumes, ConocoPhillips is expanding its LNG portfolio and enhancing its ability to deliver reliable supplies under long-term contracts. A final investment decision on Phase 2 is expected later this year.
For ConocoPhillips, the agreement represents another important step in positioning itself as a leading LNG supplier with flexibility across global markets. For the United States, the Port Arthur Phase 2 project further cements its role as a cornerstone of global LNG trade, giving America’s allies long-term assurance of access to reliable energy supplies at a time of shifting geopolitical and economic priorities.
COP’s Zacks Rank and Key Picks
COP currently carries a Zacks Rank #3 (Hold).
Investors interested in the energy sector may look at a couple of better-ranked stocks like Antero Midstream Corporation (AM - Free Report) , Enbridge Inc. (ENB - Free Report) and Precision Drilling Corporation (PDS - Free Report) . While both Antero Midstream and Enbridge carry a Zacks Rank #2 (Buy) at present, Precision Drilling sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Antero Midstream generates stable cash flow by providing midstream services under long-term contracts with Antero Resources. The company prioritizes debt reduction by effectively utilizing free cash flow after dividends. Antero Midstream’s higher dividend yield compared to its sub-industry peers reflects its commitment to generating shareholder returns.
AM’s earnings beat estimates in two of the trailing four quarters, met once and missed in the other, delivering an average surprise of 1.13%.
Enbridge is a major energy company that owns the longest and most complex oil and gas pipeline system in North America, transporting about 20% of the natural gas used in the United States. The business earns steady fees through long-term contracts that act as a protection against big oil price swings or changes in shipment.
ENB’s earnings beat estimates in three of the trailing four quarters and met once, delivering an average surprise of 5.61%.
Precision Drilling is an oilfield services company. The company provides contract drilling, well servicing and strategic support services to the oil and gas industry in North America and internationally. It provides land drilling, directional drilling, turnkey drilling, camp and catering services, and procures and distributes oilfield supplies.
PDS’ earnings beat estimates in two of the trailing four quarters and missed in the other two, delivering an average surprise of 977.7%. The Zacks Consensus Estimate for 2025 earnings indicates a 14.2% year-over-year decline.
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ConocoPhillips Strikes 20-Year LNG Deal With Sempra's Port Arthur
Key Takeaways
ConocoPhillips (COP - Free Report) has strengthened its position in the global liquefied natural gas (LNG) market by announcing a major supply agreement with Sempra Infrastructure. Under the deal, the Houston-based oil and gas producer will purchase 4 million tons per annum (MTPA) of LNG from Sempra’s Port Arthur LNG Phase 2 project in Texas over a 20-year term. The contract, structured on a free-on-board basis, is intended to serve growing global demand with shipments directed to key markets in Europe and Asia.
Ryan Lance, Chairman and CEO of ConocoPhillips, emphasized that the agreement reflects the company’s long-term commitment to LNG. He noted that the deal strengthens ConocoPhillips’ ability to build a flexible and reliable supply network, positioning the company to meet rising demand while reinforcing energy security in an evolving global market.
Per a Reuters report, the deal comes as commercial activity in the U.S. LNG sector accelerates following the lifting of a moratorium on new export permits earlier this year by President Donald Trump. According to the U.S. Energy Information Administration, the United States is already the world’s largest LNG exporter, and export capacity is expected to reach 115 million metric tons per annum before the end of 2025.
Jeffrey Martin, CEO of Sempra, highlighted the global significance of the expansion by pointing out that U.S. LNG is playing an increasingly vital role in meeting the energy security requirements of America’s allies. He also emphasized that the Port Arthur project will strengthen connections between U.S. producers and international markets while driving economic growth domestically.
This latest agreement builds on a long-standing relationship between ConocoPhillips and Sempra Infrastructure. In 2022, the company signed a 20-year deal for 5 MTPA of LNG offtake from Port Arthur Phase 1 and acquired a 30% equity stake in that project, which is slated to begin operations in 2027. By adding the Phase 2 volumes, ConocoPhillips is expanding its LNG portfolio and enhancing its ability to deliver reliable supplies under long-term contracts. A final investment decision on Phase 2 is expected later this year.
For ConocoPhillips, the agreement represents another important step in positioning itself as a leading LNG supplier with flexibility across global markets. For the United States, the Port Arthur Phase 2 project further cements its role as a cornerstone of global LNG trade, giving America’s allies long-term assurance of access to reliable energy supplies at a time of shifting geopolitical and economic priorities.
COP’s Zacks Rank and Key Picks
COP currently carries a Zacks Rank #3 (Hold).
Investors interested in the energy sector may look at a couple of better-ranked stocks like Antero Midstream Corporation (AM - Free Report) , Enbridge Inc. (ENB - Free Report) and Precision Drilling Corporation (PDS - Free Report) . While both Antero Midstream and Enbridge carry a Zacks Rank #2 (Buy) at present, Precision Drilling sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Antero Midstream generates stable cash flow by providing midstream services under long-term contracts with Antero Resources. The company prioritizes debt reduction by effectively utilizing free cash flow after dividends. Antero Midstream’s higher dividend yield compared to its sub-industry peers reflects its commitment to generating shareholder returns.
AM’s earnings beat estimates in two of the trailing four quarters, met once and missed in the other, delivering an average surprise of 1.13%.
Enbridge is a major energy company that owns the longest and most complex oil and gas pipeline system in North America, transporting about 20% of the natural gas used in the United States. The business earns steady fees through long-term contracts that act as a protection against big oil price swings or changes in shipment.
ENB’s earnings beat estimates in three of the trailing four quarters and met once, delivering an average surprise of 5.61%.
Precision Drilling is an oilfield services company. The company provides contract drilling, well servicing and strategic support services to the oil and gas industry in North America and internationally. It provides land drilling, directional drilling, turnkey drilling, camp and catering services, and procures and distributes oilfield supplies.
PDS’ earnings beat estimates in two of the trailing four quarters and missed in the other two, delivering an average surprise of 977.7%. The Zacks Consensus Estimate for 2025 earnings indicates a 14.2% year-over-year decline.