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Sources say that Tokyo Gas is in talks with Venture Global to purchase 1 mtpa LNG.

Three people familiar with the discussions said on Monday that Tokyo Gas and Venture Global are in talks to buy 1 million metric tons of liquefied gas per year from the company's CP2 Export Facility.

Venture Global, the U.S.'s second-largest LNG exporter, has been the primary source for the growing LNG export capability of the U.S. since 2023. This helps the U.S. to remain the largest exporter in the world of supercooled gas.

Tokyo Gas has begun negotiations with Venture Global to purchase LNG on a long-term contract. Two of the three sources confirmed this. Three people have confirmed that the LNG will come from the CP2 Export Facility's second phase, which is due to be operational by the end 2028.

Tokyo Gas said in a Monday statement that it was exploring different projects to secure new LNG supply, including in the United States. However, we could not comment on individual projects.

Venture Global is not available to comment immediately.

CP2 will be the second-largest LNG plant in the U.S. with a 28 mtpa export capacity. Venture Global will become the biggest U.S. exporter of LNG when it is built.

Venture Global signed 20-year purchase and sales agreements with Petronas, Eni and has expanded its long-term sale deal with Germany's SEFE since April.

Mike Sabel, CEO of CP2, said in a recent earnings call that the three new contracts bring the total volume contracted for CP2 to 13.5 mtpa.

Two people have said that Venture Global offers LNG at lower prices than the market.

One of the three said, "They're putting pressure on market because they offer LNG at liquefaction fee of $2.35 for mmBtu. Others in the market ask between $2.50 to $2.75. It makes it hard to resist."

A second source said that Venture Global offers uncommitted cargoes from its Plaquemines plant on short-term contracts to potential CP2 purchasers, allowing them access to LNG earlier.

Venture Global is currently completing construction of its 27.2 mtpa gas facility in Plaquemines in Louisiana. The facility is second in U.S. production behind Cheniere Sabine Pass in Texas. Reporting by Curtis Williams, Marwa Rahat and Yuka Obasashi in Houston; editing by Jan Harvey

(source: Reuters)