ConocoPhillips Signs Another Offtake Agreement for Port Arthur LNG

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Researched by Industrial Info Resources (Sugar Land, Texas)--ConocoPhillips (Houston, Texas) said Thursday it reached an offtake agreement for the second phase of Sempra Energy's (San Diego, California) Port Arthur LNG project, building on the existing agreement for the first phase that is under construction.

Under the new long-term sales and purchase agreement, ConocoPhillips will purchase 4 million tons per annum (MTPA) of liquefied natural gas (LNG) from the Port Arthur LNG Phase 2 project under development in Jefferson County, Texas, and offtake LNG over a 20-year term on a free-on-board basis.

In 2022, the company signed a 20-year agreement to offtake 5 MTPA from Phase 1 and "executed an agreement to purchase 30% equity stake" in the project, according to a recent press release. Phase 1 is expected to start up and begin exports in 2027. The final investment decision (FID) for Phase 2 is expected by the end of the year, although the company's participation in that project will be offtake only.

Phase 1 consists of two production trains that are under construction at the facility. Each train is expected to process 1 billion cubic feet per day of natural gas, resulting in about 6.5 MTPA of exported LNG each, or a combined 13 MTPA for the two new trains and an aggregate 26 MTPA for all four production units at the plant.

The timelines for construction of trains 3 and 4 (Phase 2) are somewhat tentative without an FID, but Industrial Info estimates that each train will take about four years to construct, meaning if Sempra begins production of Train 3 next year, the unit could likely begin operations in 2030.

Subscribers to Industrial Info's Global Market Intelligence (GMI) Production Project Database can learn more by viewing the related project reports.

Both phases have received approval from the U.S. Department of Energy (DOE) to export LNG to countries without a free trade agreement with the U.S., which comes as the domestic LNG sector is growing. For more information, see August 7, 2025, article - U.S. LNG Sector is in Overdrive.

Ryan Lance, chairman and chief executive officer of ConocoPhillips, said the agreement advances the company's "global LNG portfolio strategy as we build a flexible and reliable LNG supply network to meet growing energy demand."

However, ConocoPhillips, as part of its first-quarter earnings results in May, lowered full-year 2025 capital spending to $12.3-12.6 billion compared with prior guidance of approximately $12.9 billion. The company funded $3.4 billion of capital expenditures in the first quarter, followed by $3.3 billion last quarter.

"This is the result of continued capital efficiency improvements and plan optimization," Chief Financial Officer William Bullock said in the earnings call, adding capital should "decline materially over the back half of the year."

Subscribers can click here for a full list of active and planned projects from ConocoPhillips.

Although the company lowered capital spending for the year, it continues to indicate construction of its Willow oil prospect in Alaska is underway. The project is in the Bear Tooth development, which sits on Alaska's North Slope in the NPR-A, and is expected to produce around 180,000 barrels of oil per day. First oil is expected by 2029.

In the company's more recent second-quarter earnings call earlier this month, Lance and Executive Vice President Kirk Johnson gave an overview of the project and its status. Year-round construction has yet to begin, but they indicated the peak winter construction season wrapped up in early May and work will continue through the summer.

Johnson said about 900 tradesmen and craftsmen were on the slope, down from approximately 2,500 people during the winter season. However, "there's a lot of work ongoing" so that year-round construction can "truly begin."

Although Johnson said tariffs "have introduced some level of uncertainty and that's manifesting with internationally sourced equipment alongside a trend of inflation," the Willow project's milestones bring "strong expectations" around first oil in 2029.

Subscribers to Industrial Info's GMI Project Database can click here for a full list of Port Arthur LNG projects and here for Willow project reports.

Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).