Excelerate Inks LNG MOU with Vietnam

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Written by Daniel Graeber for Industrial Info Resources (Sugar Land, Texas)--Pouncing on quickly emerging trends in the U.S. energy sector, Excelerate Energy (The Woodlands, Texas) said it signed a preliminary agreement with a Vietnamese firm to secure U.S.-based liquefied natural gas (LNG) as early as next year.

Excelerate signed the memorandum of understanding (MOU) with PV Gas, a subsidiary of Vietnam Oil and Gas Group (Hanoi, Vietnam), to evaluate the Vietnamese company's supply agreements. Using that, both sides would later establish a strategic framework to determine long-term sourcing of LNG.

"We are pleased to partner with PV Gas on this significant opportunity," said Oliver Simpson, executive vice president and chief commercial officer of Excelerate. "This collaboration underscores our commitment to helping Vietnam meet its growing energy needs while also providing a downstream market for U.S. LNG supply."

Excelerate offered no information on the source of LNG. The company, however, signed a supply agreement with LNG provider Venture Global LNG (NYSE:VG) (Arlington, Virginia) in 2023 to secure supplies from the Plaquemines export facility in Louisiana. Venture Global introduced the first batch of feedgas into Plaquemines in December, later delivering its debut cargo to Germany.

Plaquemines ramped up quickly. As of Friday, the facility was operating at 93% of its peak design capacity of 1.89 billion cubic feet per day (Bcf/d). Praising the U.S. president, Venture Global recently announced plans to expand Plaquemines.

Excelerate, for its part, said its capital spending program could be as high as $70 million for the year. It reported full-year net income of $153 million in 2024, a 20% improvement year-on-year that the company attributed in part to a full year of earnings from the floating storage and regasification unit (FSRU) Excelsior.

Vietnam, meanwhile, is enjoying a growth spurt alongside other economies in the Asia-Pacific region. Vietnam's economy is expected to expand by 6.1% this year, according to the latest forecast from the International Monetary Fund. Unlike its Western peers, regional economies were able to arrest post-pandemic inflation in short order.

Unlike full-scale terminals, which takes years to complete, FSRUs for Vietnam would ensure quick and stable supplies for an economy looking for assurances during times of peak demand.

LNG has seen interest increase since the Russian invasion of Ukraine upended the global gas trade due to sanctions. Russia had supplied the European economy with about 25% of its gas needs through international pipelines, though the United States has since expanded its market share in the region through LNG shipments abroad.

Rich in shale natural gas, the United States has been the world leader in LNG exports since 2022. Exports so far have been above the expected 14 Bcf/d average this year.

U.S. President Donald Trump is decidedly pro-fossil fuels. In one of his first acts of office this year, he overturned a suspension on new LNG permits that was ordered by his predecessor.

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