Business/Consumer · NEWS EXPLAINER
Petrobras signs 22-year Cheniere LNG deal for 0.8 million tonnes a year
Petrobras agreed to buy about 0.8 million tonnes of LNG a year from Cheniere Marketing for 22 years on a free-on-board basis. The companies disclosed the volume and term but not the exact start year, LNG price formula or a single loading terminal assigned to the deal.
Petrobras has signed a 22-year liquefied-natural-gas supply agreement with Cheniere Marketing for about 0.8 million tonnes a year, adding another long-term U.S. LNG contract to the Brazilian company's gas portfolio. Reuters reported the deal September 29, and both companies separately confirmed the same annual volume and contract length.
The agreement is on a free-on-board basis, meaning the public contract description places delivery at the loading point rather than as a delivered cargo to a named destination. The announcements do not identify a specific Cheniere terminal for the Petrobras volumes, disclose the exact first-delivery year or publish the LNG pricing formula.
The headline contract is 0.8 mtpa for 22 years
Reuters, Petrobras and Cheniere all describe the same core commitment: approximately 0.8 million tonnes of LNG per year under a 22-year sale-and-purchase agreement with Cheniere Marketing.
Multiplying the disclosed annual volume by the term produces 17.6 million tonnes across 22 years if the full annual amount is purchased every year. That calculation helps put the contract's scale in context, but it should not be confused with a separately disclosed guaranteed aggregate delivery figure because the public releases do not publish detailed annual scheduling or tolerance provisions.
FOB explains where delivery happens, not where every cargo will go
The companies say the LNG will be sold on a free-on-board basis. In practical terms, the public contract description places the delivery hand-off at the loading point, with onward ocean transport controlled by the buyer rather than Cheniere delivering a cargo to a named Brazilian terminal.
That does not tell readers which U.S. terminal will load every cargo. Petrobras notes that Cheniere's operating platform includes Sabine Pass in Louisiana and Corpus Christi in Texas, but neither company's reviewed announcement assigns this 0.8 mtpa contract exclusively to one of them.
Petrobras is using long-term contracts to reduce spot-market exposure
Petrobras says locking in long-term LNG volumes is part of its strategy to reduce exposure to volatile spot prices, strengthen risk management in its natural-gas portfolio and maintain more flexibility and supply security when serving contracts.
The Cheniere deal follows a separate long-term agreement Petrobras announced earlier in September with Sempra Infrastructure for another 0.8 mtpa over 20 years. The terms are not interchangeable: Petrobras said the Sempra supply would come from Port Arthur LNG, while the reviewed Cheniere announcement does not name a dedicated loading terminal or first-delivery date.
Several commercial terms remain undisclosed
Cheniere CEO Jack Fusco says the Petrobras agreement adds commercial support and fixed-fee cash-flow visibility for further brownfield liquefaction-capacity growth. That statement describes Cheniere's commercial benefit from the contract; it is not a public disclosure of the LNG price Petrobras will pay.
The reviewed announcements do not publish a pricing index, fixed liquefaction fee, exact commencement year or contract-specific terminal. Cheniere has disclosed pricing formulas in other SPAs, but those separate contracts should not be used to fill missing terms in the Petrobras agreement. The next concrete details to watch are any later regulatory filing or company disclosure that specifies start timing, pricing mechanics or dedicated supply capacity.
