Chevron signs 25 year gas supply deal with Japan's Chubu Electric

Following its 20-year gas supply deal with Tokyo Electric Power Company, Japan's largest power utility, Chevron has said that its Australian subsidiaries have signed binding long-term agrements with Japanese power producer Chubu Electric Power for a portion of Chevron's share of liquefied natural gas (LNG) from the Gorgon Project. (See: Chevron signs $90 billion gas deal with Tokyo Electric Power)

Under the agreement, Chevron will supply Chubu Electric 1.44 million metric tons per year (MTPY) of LNG for 25 years. Also, Chubu Electric intends to purchase 0.417 per cent equity from Chevron's stake in the Gorgon Project.

"We are pleased to build on our long-term relationship with Chubu Electric and welcome them as a foundation customer and equity participant in the Gorgon Project," said Jim Blackwell, president, Chevron Asia Pacific Exploration and Production Company. "The SPA with Chubu Electric continues to build momentum toward commercializing our equity natural gas in the project."

The agreement follows the recent signing of three binding long-term SPAs with Osaka Gas, Tokyo Gas and GS Caltex, a 50 percent-owned Chevron equity affiliate, for delivery of a total of nearly 3 MTPY, as well as a Heads of Agreement with the Korea Gas Corporation (KOGAS) for 1.5 MTPY.

"The foundation customers in Gorgon are leading energy companies in the world's largest LNG markets. Our agreements position Chevron to deliver supplies to meet long-term demand in the growing Asia-Pacific region," said John Gass, president, Chevron Global Gas.

The Gorgon Project is operated by Chevron, which will have an approximate 47 percent interest in the project after the sale to Chubu.