Sempra Infrastructure and JERA Announce Sale and Purchase Agreement for U.S. LNG from Port Arthur LNG Phase 2

Rhea-AI Summary

Sempra Infrastructure (NYSE: SRE) has signed a significant 20-year sale and purchase agreement with JERA Co. for 1.5 million tonnes per annum of LNG from the Port Arthur LNG Phase 2 project in Texas. The agreement follows a non-binding heads of agreement from June 2025.

The Port Arthur LNG Phase 2 project will include two liquefaction trains with a capacity of 13 Mtpa, potentially doubling the facility's total capacity to 26 Mtpa. The project has secured key permits, including FERC authorization and DOE export approval. Phase 1 of the project is under construction with expected commercial operation in 2027-2028.

Positive

• Secured major 20-year LNG supply agreement with JERA, strengthening presence in Asian markets
• Project has obtained all key regulatory permits and authorizations
• Selected Bechtel for fixed-price engineering and construction contract
• Potential to double facility capacity to 26 Mtpa with Phase 2

Negative

• Project still subject to final investment decision
• Development contingent on completing additional commercial agreements and securing financing
• Phase 1 construction completion not expected until 2027-2028

Insights

Energy Infrastructure Analyst

Sempra secures significant 20-year LNG contract with JERA, strengthening Phase 2 development prospects and Asian market position.

This 20-year agreement for 1.5 million tonnes per annum (Mtpa) of LNG between Sempra Infrastructure and JERA represents a significant commercial milestone for the Port Arthur LNG Phase 2 project. Long-term offtake agreements are critical in the LNG industry as they provide the revenue certainty needed to secure financing for these capital-intensive projects, bringing the Phase 2 development closer to a final investment decision.

The agreement with JERA, a major Japanese energy company, strengthens Sempra's position in Asian markets where demand for LNG remains robust. Japan continues to be one of the world's largest LNG importers, and securing this stable, long-term customer enhances Sempra's global portfolio diversification and revenue visibility.

When completed, Port Arthur LNG Phase 2 would double the facility's capacity from 13 Mtpa to approximately 26 Mtpa. The project has already secured critical regulatory approvals from FERC and the Department of Energy for non-FTA exports, reducing development risk. The earlier selection of Bechtel for a fixed-price EPC contract is also significant as it helps mitigate construction cost uncertainty in what has been a volatile market for large-scale infrastructure projects.

Phase 1 of Port Arthur LNG is already under construction with expected commercial operation in 2027-2028, creating a development pathway for Phase 2. This sequential approach allows Sempra to leverage existing infrastructure and operational experience, potentially improving returns on the second phase.

While this agreement substantially improves the commercial viability of Phase 2, investors should note that final investment decision still depends on securing additional offtake agreements, finalizing financing, and managing market conditions in a competitive global LNG environment.

HOUSTON, July 31, 2025 /PRNewswire/ -- Sempra Infrastructure, a subsidiary of Sempra (NYSE: SRE), and JERA Co., Inc. (JERA) today announced a 20-year sale and purchase agreement for the supply of 1.5 million tonnes per annum (Mtpa) of liquefied natural gas (LNG) offtake from the Port Arthur LNG Phase 2 development project in Jefferson County, Texas. The LNG will be supplied on a free-on-board basis.

This agreement marks a major step forward from the non-binding heads of agreement signed in June 2025 and underscores Sempra Infrastructure and JERA's shared commitment to supporting energy security and a lower carbon future through stable, long-term LNG supply.

"This agreement establishes a long-term relationship with JERA and confirms Sempra Infrastructure's commitment to customers in Japan and the greater Asian market and their continued access to affordable and secure U.S. natural gas," said Justin Bird, chief executive officer of Sempra Infrastructure. "We remain focused on advancing our Port Arthur LNG Phase 2 development project to a final investment decision and strengthening the role of the United States as an energy provider of choice for LNG buyers worldwide."

Ryosuke Tsugaru, chief low carbon fuel officer for JERA adds, "This agreement marks a significant strategic relationship with Sempra Infrastructure and underscores our commitment to securing a reliable, long-term LNG supply from trusted sources. Aligning with JERA's growth strategy, the addition of flexible and dependable LNG volumes strengthens our overall LNG portfolio and enhances our ability to respond to the evolving global energy landscape while helping to ensure supply stability for Japan and across Asia."

The proposed Port Arthur LNG Phase 2 project is competitively positioned and is under active marketing and development. Future phases are also in the early development stage.

The project has received all its key permits and is expected to include two liquefaction trains capable of producing approximately 13 Mtpa of LNG, which could increase the total liquefaction capacity of the Port Arthur LNG facility from approximately 13 Mtpa for Phase 1 to up to approximately 26 Mtpa.

In September 2023 the project received authorization from the Federal Energy Regulatory Commission. In July 2024, Sempra Infrastructure announced that Bechtel had been selected for a fixed-price engineering, procurement and construction contract for the project. More recently, the project received authorization in May 2025 from the U.S. Department of Energy to export U.S. LNG to countries that do not have a free-trade agreement with the U.S.

The Port Arthur LNG Phase 1 project, which is currently under construction, is expected to achieve commercial operation in 2027 and 2028 for trains 1 and 2, respectively.

The development of the Port Arthur LNG Phase 2 project remains subject to a number of risks and uncertainties, including completing the required commercial agreements, securing and/or maintaining all necessary permits, obtaining financing and reaching a final investment decision, among other factors.

About Sempra Infrastructure
Sempra Infrastructure, headquartered in Houston, is focused on delivering energy for a better world by developing, building, operating and investing in modern energy infrastructure, such as LNG, energy networks and low-carbon solutions that are expected to play a crucial role in the energy systems of the future. Through the combined strength of its assets in North America, Sempra Infrastructure is connecting customers to safe and reliable energy and advancing energy security. Sempra Infrastructure is a subsidiary of Sempra (NYSE: SRE), a leading North American energy infrastructure company. For more information, visit semprainfrastructure.com or connect with Sempra Infrastructure on social media @SempraInfra.

About JERA
JERA is a global energy leader and Japan's largest power generation company focused on providing cutting-edge solutions to the world's energy issues. Established in 2015, the Company produces one-third of Japan's electricity and is one of the largest LNG buyers in the world. JERA has global reach and strength throughout the energy supply chain, from participation in LNG upstream projects and fuel procurement, through fuel transportation to power generation. In support of a responsible energy transition, JERA has committed to achieving net-zero CO₂ emissions from its domestic and overseas businesses by 2050.

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on assumptions about the future, involve risks and uncertainties, and are not guarantees. Future results may differ materially from those expressed or implied in any forward-looking statement. These forward-looking statements represent our estimates and assumptions only as of the date of this press release. We assume no obligation to update or revise any forward-looking statement as a result of new information, future events or otherwise.

In this press release, forward-looking statements can be identified by words such as "believe," "expect," "intend," "anticipate," "contemplate," "plan," "estimate," "project," "forecast," "envision," "should," "could," "would," "will," "confident," "may," "can," "potential," "possible," "proposed," "in process," "construct," "develop," "opportunity," "preliminary," "initiative," "target," "outlook," "optimistic," "poised," "positioned," "maintain," "continue," "progress," "advance," "goal," "aim," "commit," or similar expressions, or when we discuss our guidance, priorities, strategies, goals, vision, mission, projections, intentions or expectations.

Factors, among others, that could cause actual results and events to differ materially from those expressed or implied in any forward-looking statement include: decisions, audits, investigations, inquiries, regulations, denials or revocations of permits, consents, approvals or other authorizations, and other actions, including the failure to honor contracts and commitments, by the (i) U.S. Department of Energy, Comisión Nacional de Energía, U.S. Federal Energy Regulatory Commission, U.S. Internal Revenue Service and other regulatory bodies and (ii) U.S., Mexico and states, counties, cities and other jurisdictions therein and in other countries where we do business; the success of business development efforts, construction projects, acquisitions, divestitures and other significant transactions, including risks related to (i) being able to make a final investment decision, (ii) negotiating pricing and other terms in definitive contracts, (iii) completing construction projects or other transactions on schedule and budget, (iv) realizing anticipated benefits from any of these efforts if completed, (v) obtaining regulatory and other approvals and (vi) third parties honoring their contracts and commitments; changes to our capital expenditure plans and their potential impact on growth; changes, due to evolving economic, political and other factors, to (i) trade and other foreign policy, including the imposition of tariffs by the U.S. and foreign countries, and (ii) laws and regulations, including those related to tax and the energy industry in the U.S. and Mexico; litigation, arbitration, property disputes and other proceedings; cybersecurity threats, including by state and state-sponsored actors, of ransomware or other attacks on our systems or the systems of third parties with which we conduct business, including the energy grid or other energy infrastructure; the availability, uses, sufficiency, and cost of capital resources and our ability to borrow money or otherwise raise capital on favorable terms and meet our obligations, which can be affected by, among other things, (i) actions by credit rating agencies to downgrade our credit ratings or place those ratings on negative outlook, (ii) instability in the capital markets, and (iii) fluctuating interest rates and inflation; the impact on our ability to pass through higher costs to customers due to volatility in inflation, interest and foreign currency exchange rates and commodity prices and the imposition of tariffs; the impact of climate policies, laws, rules, regulations, trends and required disclosures, including actions to reduce or eliminate reliance on natural gas, the risk of nonrecovery for stranded assets, and uncertainty related to emerging technologies; weather, natural disasters, pandemics, accidents, equipment failures, explosions, terrorism, information system outages or other events, such as work stoppages, that disrupt our operations, damage our facilities or systems, cause the release of harmful materials or fires or subject us to liability for damages, fines and penalties, some of which may not be recoverable through insurance or may impact our ability to obtain satisfactory levels of affordable insurance; the availability of natural gas, including disruptions caused by failures in the pipeline and storage systems or limitations on the injection and withdrawal of natural gas from storage facilities; and other uncertainties, some of which are difficult to predict and beyond our control.

These risks and uncertainties are further discussed in the reports that Sempra has filed with the U.S. Securities and Exchange Commission (SEC). These reports are available through the EDGAR system free-of-charge on the SEC's website, www.sec.gov, and on Sempra's website, www.sempra.com. Investors should not rely unduly on any forward-looking statements.

Sempra Infrastructure and Sempra Infrastructure Partners are not the same company as San Diego Gas & Electric Company or Southern California Gas Company, and none of Sempra Infrastructure, Sempra Infrastructure Partners nor any of its subsidiaries is regulated by the California Public Utilities Commission.

 

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SOURCE Sempra Infrastructure

FAQ

What is the size of Sempra's LNG supply agreement with JERA for Port Arthur Phase 2?

Sempra Infrastructure signed a 20-year agreement to supply 1.5 million tonnes per annum of LNG to JERA from Port Arthur LNG Phase 2.

What is the total capacity of Sempra's Port Arthur LNG facility after Phase 2?

After Phase 2 completion, the total liquefaction capacity of Port Arthur LNG facility would increase from 13 Mtpa to approximately 26 Mtpa.

When will Sempra's Port Arthur LNG Phase 1 begin operations?

Port Arthur LNG Phase 1 is expected to achieve commercial operation in 2027 for train 1 and 2028 for train 2.

What major permits has Sempra secured for Port Arthur LNG Phase 2?

The project has received FERC authorization (September 2023) and DOE export approval (May 2025) for non-free trade agreement countries.

Who is the construction contractor for Sempra's Port Arthur LNG Phase 2?

Bechtel has been selected for a fixed-price engineering, procurement and construction contract for the project.