Wednesday, 3 September, 2025 / Edition 74

During the past weekend, my teammates and I joined the Dallas autumn regional bridge tournament. We got to face off against some of the top bridge players in the world, such as the legendary Bob Hamman. It was so much fun playing this marvelous game with many like-minded folks from around the world.

Now onto two pieces of energy news from last week.

Shangyou Nie

Editor, Well Read

EQT Signs 20-Year LNG Offtake Agreement with Sempra

GreenOak/Shutterstock

EQT, one of the largest gas producers in the USA, signed a 20-year LNG offtake agreement with Sempra. This is the first LNG offtake deal signed by a purely American gas producer with a fellow LNG developer. This is the latest testimony to the expanding opportunity in the US LNG export business.

What happened:

• In a strategic move, Pittsburgh-based EQT announced it has signed a definitive 20-year agreement to buy 2 million tonnes per year of LNG from Sempra.

• The offtake will be from Sempra’s Phase 2 LNG project in Port Arthur, Texas, scheduled to reach a final investment decision later in 2025.

• Sempra’s Phase 2 project in Port Arthur will consist of two LNG trains with a combined capacity of 13 MTPA.

• The SPA will be on a free-on-board basis with gas price indexed to Henry Hub.

About EQT:

• EQT is a vertically integrated gas company with production and gas and water pipelines.

• EQT calls itself a “premier pure-play Appalachian producer” in eastern America, producing roughly 6 billion cubic feet of gas per day.

• It has a market of $32 billion.

• In its Q2 analyst presentation, EQT emphasized two growth areas for domestic gas: data centers and LNG export.

• In July 2024, EQT signed a tolling agreement with Texas LNG to produce 2 million tons per annum.

• Texas LNG is based in Brownsville, Texas, and has a capacity of 4 MTPA. Its plan to take FID in 2024 has slipped.

About Sempra:

• Sempra is a San Diego-based energy company with power business in California and Texas, in addition to its LNG business under its subsidiary Sempra Infrastructure, based in Houston.

• Sempra has a market cap of $53 billion, the same as America’s largest LNG producer, Cheniere.

• Sempra has been producing LNG since 2019 from Cameron LNG, based in Hackberry, Louisiana.

• Sempra is constructing Phase 1 of two trains in Port Arthur, with a capacity of 13 MTPA.

• Trains 1 and 2 from Phase 1 are scheduled to come on stream in 2027, 2028, respectively.

• Sempra has recently signed several 20-year SPAs with buyers:

  • In July, with Japanese buyer Jera for 1.5 MTPA

  • In August, with ConocoPhillips for an additional 4 MTPA

What they're saying:

• Toby Rice, CEO of EQT, has been one of the strongest voices promoting US gas and LNG businesses. “(Texas LNG agreement) brings us one step closer to unleashing EQT’s reliable, low-emissions natural gas on the global stage,” said Rice in July.

• “I think beyond what we do domestically, that (LNG) is a huge opportunity for us,” said Jeremy Knop, EPT CFO during their Q2 analyst call.

🚨 Trend alert:

• Traditionally, European majors, including Shell, TotalEnergies, and BP, as well as Asian market holders, have signed long-term LNG SPAs with American LNG producers.

• More recently, Middle East investors, including ADNOC and Saudi Aramco, have joined the wave.

• This EQT–Sempra deal is the first time a domestically focused US gas producer has ventured into LNG trading business.

• In addition to Sempra’s vertical integration from wells to pipelines, this expansion into LNG could be seen as a further value integration and a natural hedge for gas price volatility.

• For now, EQT’s main gas-producing assets are located in the Appalachian Basin, far from the current and planned LNG plants around the Gulf of Mexico (America).

• Would EQT acquire a Texas/Louisiana gas producer to become a direct gas supplier to LNG plants?

Sponsored

SNH Invites Bids for Bipaga-Mpolongwe Gas Pipeline Inspection

The Tender is open to national and international companies, with proven experience in carrying out inspection of gas pipelines.

Orsted Share Price Plummets As Offshore Wind Business Met With Latest Hurdle

ShutterDesigner/Shutterstock

Stocks for Orsted, the world's largest offshore wind developer from Denmark, fell by 16 percent to a new low of DKr 180 last week. The Trump administration ordered the suspension of construction on its Revolution Wind project. Equinor decided to deepen its investment in Orsted to show continued confidence in the company.

What Trump Administration ordered Orsted to do:

• Acting Director Matthew Giacona from the US Bureau of Ocean Energy Management issued a “stop-work” order for Orsted’s $1.5 billion Revolution Wind Project.

• In the BOEM letter, Orsted is to “halt all ongoing activities related to the Revolution Wind Project.”

• “BOEM is seeking to address concerns related to the protection of national security interests of the US,” and “You may not resume activities until BOEM informs you that BOEM has completed its necessary review,” said the letter.

Background:

• The Revolution Wind project is located offshore Rhode Island and Connecticut.

• It is operated by Revolution Wind LLC, a 50/50 joint venture between Orsted and Global Infrastructure Partners, acquired by BlackRock in October 2024.

• Orsted has signed a 20-year contract with the two states to deliver 400 MegaWatts of electricity that can power 350,000 homes.

• According to the Financial Times, the $1.5 billion Revolution Wind project is four-fifths complete.

• In addition to Revolution Wind, Orsted has three other offshore wind projects in the USA:

  • Block Island Wind (in operation, offshore Rhode Island, capacity 30 MW)

  • South Fork Wind (in operation, offshore New York, capacity 132 MW)

  • Sunrise Wind (under construction, offshore New York, capacity 924 MW)

• Orsted was once one of the most successful companies that has undergone an energy transition from oil/gas to renewables.

• Orsted changed its name in 2017 from DONG (Danish Oil and Natural Gas) Energy.

• At the peak in 2021, Orsted's share price reached DKr 1253, or about $200 per share.

• Its share price has declined by 85 percent since then.

• As of 1 September 2025, Orsted's market cap is DKr 86 or $13.5 billion, down from its peak of $130 billion.

What did Equinor do and why:

• On 1 September, Equinor decided to inject $1 billion into Orsted, in response to Orsted’s plan to raise $9.4 billion.

• With this new investment, Equinor has doubled its investment in Orsted after acquiring 10 percent of Orsted equity in December 2024.

• Equinor is Orsted’s second-largest investor after the Danish government.

• Analysts say that Equinor’s latest investment would help other investors to have the confidence to put in additional capital for Orsted.

• In April, Equinor also received a stop-work order from the Trump administration for its own Empire Wind 1 project offshore New York.

• The order was later overturned after the intervention of the Norwegian government and former Nato Secretary General Jens Stoltenberg.

• Trump is against offshore wind as an energy solution.

• During the Biden administration, European energy companies, including BP, Shell, Equinor, and Orsted, tried to invest in multiple billion-dollar offshore projects along the east coast of the US.

• High interest, lack of supporting industry, and withdrawal of US policy support have led European investors to write off $1 billion.

What they're saying:

• “Orsted is evaluating the potential financial implications of this development, considering a range of scenarios, including legal proceedings,” said Orsted in a statement.

• “In response to the challenges facing offshore wind, the industry will see consolidation and new business models. Equinor believes that a closer industrial and strategic collaboration between Orsted and Equinor can create value for all shareholders in both companies,” said Equinor in a statement, quoted by the FT.

What to watch:

• Would Orsted be allowed to resume construction work for the Revolution Wind project?

• Would BOEM also issue a stop-work order for the Orsted Sunrise Wind project?

Sponsored

Ready to Elevate how you Explore and Evaluate?

AI/ML tools integrate with our interpretation software and upstream data, supporting consistent, iterative workflows from data preparation through analysis.

👍 If you enjoyed this edition of Well Read, consider supporting AAPG's brand of newsletters by forwarding to a friend or colleague and signing up for our other newsletters here.

➡️ Was this newsletter forwarded to you? Sign up for Well Read here.

✉️ To get in touch with Shangyou, send an email to editorial@aapg.org.