Back to top

Image: Shutterstock

TotalEnergies and KOGAS Sign a 10-Year LNG Supply Agreement

Read MoreHide Full Article

Key Takeaways

  • TotalEnergies signed a 10-year Heads of Agreement with KOGAS for 1 Mt LNG supply yearly.
  • From 2028, TTE will deliver 3 Mt LNG annually from its U.S. and global portfolio.
  • TTE aims to expand LNG to nearly 50% of its sales mix by 2030 while cutting emissions.

TotalEnergies SE (TTE - Free Report) announced the signing of a Heads of Agreement with South Korea’s national natural gas company KOGAS. The deal includes the annual delivery of 1 million tons (“Mt”) of liquefied natural gas (“LNG”) to South Korea over a 10-year period, starting at the end of 2027.

Benefits of the Deal

From 2028 onward, TotalEnergies will supply KOGAS with 3 Mt of LNG annually. These extra LNG quantities will thereafter be supplied to Korean homes, companies, and industries. They will originate in the global supply portfolio of TotalEnergies, specifically from its LNG production and offtake in the United States. This fortifies TotalEnergies' position in the LNG market and ensures a consistent, long-term revenue stream.

In the face of geopolitical unpredictability, the contract's emphasis on supply diversification aligns TotalEnergies with larger trends toward stable, long-term contracts. Utilizing supplies from its international portfolio, especially in the United States, allows TotalEnergies to increase its contractual flexibility and market diversity.

According to Shell’s (SHEL - Free Report) LNG Outlook 2025 report, global demand for LNG is forecasted to rise around 60% by 2040, largely driven by economic growth in Asia, emission reductions in heavy industry and transport as well as the impact of artificial intelligence. This deal strengthens TotalEnergies' position in the face of growing regional energy demands by enabling it to capitalize on the development trend.

The Primary Goal of TTE in the LNG Chain

TotalEnergies benefits from an integrated position across the LNG value chain, including production, transportation, access to more than 20 million tons per annum (Mtpa) of regasification capacity in Europe, trading and LNG bunkering.

TTE’s global LNG portfolio was 40 Mtpa in 2024, owing to its interests in liquefaction plants in all geographies. The company continues to expand its LNG operation through acquisitions, partnerships and agreements. Its large fleet of LNG tankers and reserved capacity in several regasification terminals make it a perfect partner for the development of LNG projects globally.

TTE’s expanding LNG operation is in sync with its long-term ambition to increase the share of natural gas in its sales mix to nearly 50% by 2030, reduce carbon emissions and eliminate methane emissions associated with the gas value chain.

Other Stocks to Watch

The rising demand for LNG should also boost the prospects of companies like Cheniere Energy (LNG - Free Report) , and BP plc (BP - Free Report) , as these play a vital role in the global supply of LNG. 

Cheniere Energy continues to solidify its position as a dominant force in the United States. In June 2025, Cheniere Energy announced updates to its long-term company outlook, including an over 10% increase to its run-rate LNG production forecast, inclusive of the CCL Midscale Trains 8 & 9 Project and debottlenecking.

The Zacks Consensus Estimate for Cheniere’s 2025 sales indicates a year-over-year increase of 32%. The company delivered an average earnings surprise of 88.5% in the trailing four quarters.

BP has established substantial LNG marketing and trading capabilities worldwide, making it a well-known global player in the LNG industry. To accomplish this, it has a worldwide portfolio in place and aims to reach BP's 25 mpta target by 2025.

BP’s long-term (three to five years) earnings growth rate is 7.23%. The Zacks Consensus Estimate for 2025 sales indicates a year-over-year increase of 13.8%.

TTE’s Stock Price Performance

In the past six months, shares of TotalEnergies have risen 0.1% compared with the industry’s 9.3% growth.    

 

Zacks Investment Research
Image Source: Zacks Investment Research

TTE’s Zacks Rank

The company currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

 

Published in