Santos Signs Two Long-Term LNG Agreements Involving Supply to South Korea and Procurement from Canada

en.Wedoany.com Reported - On September 15, Australian energy company Santos announced two separate liquefied natural gas agreements with South Korea's POSCO and Canada's Western LNG. Under one, Santos will supply LNG to POSCO starting in 2030 or 2031 under a 10-year contract, with supply sourced from its global LNG asset portfolio on a delivered ex-ship (DES) basis; under the other, Santos will purchase approximately 1 million tonnes per annum of LNG from Canada's Ksi Lisims LNG project for a term of up to 20 years, with deliveries expected to begin around 2031 on a free-on-board (FOB) basis.

The Santos-POSCO agreement corresponds to long-term supply to an Asian end customer. The public information disclosed so far does not include the annual contract volume or price formula for the supply to POSCO, but the 10-year contract term, the 2030 or 2031 start-up window and the DES delivery mode have been confirmed. Santos will source the volumes from its global LNG portfolio rather than limiting supply to a single liquefaction project.

The other agreement corresponds to upstream procurement from Canada's Ksi Lisims LNG. Western LNG announced that Ksi Lisims LNG has signed a heads of agreement with Santos for the supply of 1 million tonnes per annum of LNG for a term of up to 20 years, with a formal sale and purchase agreement still to be signed. The project plans to build two floating liquefaction and storage facilities on the northwest coast of British Columbia, Canada, with a total designed capacity of approximately 12 million tonnes per annum, on land owned by the Nisga'a Nation.

Ksi Lisims LNG is currently in the commercialization and pre-final investment decision stage. The project developers include the Nisga'a Nation, Rockies LNG and Western LNG. According to Canadian federal government materials, the project obtained a federal Decision Statement and a British Columbia environmental assessment certificate in September 2025; in January 2026, the project signed a memorandum of understanding with BC Hydro and plans to secure 600 megawatts of power supply following the expansion of the North Coast transmission line.

Before Santos joined, Ksi Lisims LNG had already signed long-term sale and purchase agreements with Shell, TotalEnergies and Uniper, locking up a combined approximately 6 million tonnes per annum of capacity, equivalent to half of the project's planned 12 million tonnes per annum capacity. Western LNG said it plans to complete commercialization of all planned capacity within 2026. With Santos' additional 1 million tonnes per annum procurement arrangement, the project's long-term sales coverage has further increased, but the Santos agreement is still at the stage of converting from a heads of agreement to a formal SPA.

In 2026, POSCO Group has listed LNG as one of its directions for expanding resource-based businesses and has proposed expanding LNG trading volumes and extending the industrial chain. The group's existing energy infrastructure includes assets such as the Gwangyang LNG terminal, and its energy business also covers import, storage, trading and terminal infrastructure. The 10-year supply arrangement reached with Santos corresponds to its new long-term LNG procurement source.

Santos' existing LNG business covers assets including Australia's GLNG, Barossa and PNG LNG. The company disclosed in the second quarter of 2026 that PNG LNG's facility reliability rate in the quarter exceeded 98%, equivalent to an annualized operating capacity of approximately 8.7 million tonnes; GLNG's upstream natural gas production was approximately 703 terajoules per day. The two agreements add long-term contracts on the Asian long-term sales side and the Canadian long-term procurement side respectively, adding long-term contractual arrangements on both the buy and sell sides to its 2030s LNG portfolio.