Excelerate Energy Signs 15-Year LNG Supply Deal with QatarEnergy

Rhea-AI Summary

Excelerate Energy, Inc. (NYSE: EE) and QatarEnergy have entered into a 15-year LNG Sales and Purchase agreement, with Excelerate agreeing to purchase up to 1.0 million tonnes per annum of LNG from QatarEnergy on a delivered ex-ship basis in Bangladesh. The agreement highlights Excelerate's ability to secure critical and affordable LNG volumes for its customers, while supporting the energy requirements of Bangladesh and its economic development. The deal signifies a new milestone in the collaboration between the two companies and aims to enhance energy security for countries around the world.

Insights

Energy Market Analyst

The long-term liquefied natural gas (LNG) Sales and Purchase Agreement (SPA) between Excelerate Energy and QatarEnergy represents a significant commitment for both parties, with implications for energy markets and potentially the share value of Excelerate Energy. The agreement, which secures up to 1.0 million tonnes per annum (MTPA) of LNG for Bangladesh, underlines the increasing demand for cleaner energy sources in developing economies.

From an energy market perspective, this deal may influence LNG pricing dynamics due to the volume and duration of the contract. Moreover, it could enhance Excelerate's competitive position in the LNG market by ensuring a stable supply for a growing market. This stability might be seen favorably by investors, as it provides predictable revenue streams and potential for long-term growth.

Furthermore, Excelerate's role in facilitating Bangladesh's energy security and economic development through LNG infrastructure could lead to additional opportunities within the region. The deal also reflects a broader industry trend towards long-term agreements in the energy sector, which can provide a buffer against volatile commodity prices.

Financial Analyst

With the announcement of the SPA, Excelerate Energy's financial outlook may be positively impacted. The deal guarantees a fixed volume of LNG purchases over a 15-year period, which can be factored into revenue projections and cash flow analysis. This kind of long-term contract can be particularly appealing to investors looking for stability in an industry that is known for its cyclical nature and price volatility.

For Excelerate, the agreement could translate into improved margins and financial performance, given the predictable nature of the contracted sales. It is also likely to enhance the company's creditworthiness by providing a clearer future earnings trajectory. The impact on the stock market will depend on how the deal is perceived in terms of its contribution to Excelerate's growth strategy and its alignment with global energy transition goals.

Environmental Policy Expert

This SPA reflects a strategic move towards cleaner energy solutions, as LNG is often considered a transition fuel towards a low-carbon economy. The agreement aligns with global efforts to reduce carbon emissions and could bolster Excelerate's reputation as a company contributing to the energy transition.

For stakeholders concerned with environmental impact, the deal signifies progress, as it potentially displaces more carbon-intensive fuels in Bangladesh. However, it is essential to consider the full lifecycle emissions of LNG, including extraction, liquefaction, transportation and regasification. The environmental implications of this agreement must be weighed against the immediate need for reliable energy sources in developing countries and the long-term goal of achieving a sustainable energy mix.

THE WOODLANDS, Texas--(BUSINESS WIRE)-- Excelerate Energy, Inc. (NYSE: EE) (the Company or Excelerate) and QatarEnergy announced today the execution of a 15-year liquefied natural gas (“LNG”) Sales and Purchase agreement (“SPA”). Under the SPA, Excelerate has agreed to purchase up to 1.0 million tonnes per annum (“MTPA”) of LNG from QatarEnergy on a delivered ex-ship basis in Bangladesh for 15 years, beginning January 2026. Excelerate will purchase 0.85 MTPA of LNG in 2026 and 2027 and 1.0 MTPA from 2028 to 2040.

(Photo: Business Wire)

“This inaugural long term supply agreement with the world’s largest LNG supplier marks a new milestone in our collaboration with QatarEnergy. Qatar delivers approximately 10 percent of its current annual LNG production through Excelerate FSRUs and we are pleased to unlock further new demand in the markets where we operate,” said Steven Kobos, President and Chief Executive Officer of Excelerate. “This agreement highlights our ability to secure critical and affordable LNG volumes for our customers with increasing natural gas demand, while driving stable, long-term economic uplift on our existing infrastructure.”

Commenting on this occasion, His Excellency Mr. Saad Sherida Al-Kaabi, the Minister of State for Energy Affairs, the President and CEO of QatarEnergy, said: “We are pleased to sign this agreement with Excelerate for the supply of up to one million tons per annum of LNG to Bangladesh. This new agreement will further strengthen our relationship with Excelerate while also supporting the energy requirements of the People’s Republic of Bangladesh and its stride towards greater economic development.”

As a leading provider of flexible LNG infrastructure and integrated solutions, Excelerate Energy is helping to enhance energy security for countries around the world, while supporting their transition to a clean energy future.

About Excelerate Energy:

Excelerate Energy, Inc. is a U.S.-based LNG company located in The Woodlands, Texas. Excelerate is changing the way the world accesses cleaner forms of energy by providing integrated services along the LNG value chain with the objective of delivering rapid-to-market and reliable LNG solutions to customers. The Company offers a full range of flexible regasification services from FSRUs to infrastructure development to LNG supply. Excelerate has offices in Abu Dhabi, Antwerp, Boston, Buenos Aires, Chattogram, Dhaka, Doha, Dubai, Helsinki, Manila, Rio de Janeiro, Singapore, and Washington, DC. For more information, please visit www.excelerateenergy.com.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240129303107/en/

Investors:

Craig Hicks

Excelerate Energy

craig.hicks@excelerateenergy.com

Media:

Stephen Pettibone / Frances Jeter

FGS Global

excelerate@fgsglobal.com

or

media@excelerateenergy.com

Source: Excelerate Energy, Inc.

FAQ

What is the length of the LNG Sales and Purchase agreement between Excelerate Energy, Inc. and QatarEnergy?

The agreement is for a 15-year term.

How much LNG has Excelerate agreed to purchase from QatarEnergy annually?

Excelerate has agreed to purchase up to 1.0 million tonnes per annum of LNG from QatarEnergy.

Where will the LNG be delivered under the agreement?

The LNG will be delivered on a delivered ex-ship basis in Bangladesh.

When will the LNG purchases under the agreement commence?

The purchases will begin in January 2026 and continue for 15 years.

Who is the President and Chief Executive Officer of Excelerate Energy?

Steven Kobos is the President and Chief Executive Officer of Excelerate Energy.