Golar, ExxonMobil ink Brazil LNG deal

Golar GenPower Brasil Participações signed a framework agreement to supply LNG to the natural gas-fired power generation project it is developing in the Brazilian state of Sergipe.

The firm is a JV between LNG Power, which is a standalone non-recourse subsidiary of Golar LNG, and GenPower Participações.

Golar GenPower and ExxonMobil Titan LNG agreed heads of terms covering LNG supply to the 1,500MW Porto de Sergipe project.

The agreement also establishes a framework for LNG to be supplied exclusively from ExxonMobil for expansion phases and other projects that Golar GenPower is pursuing in Brazil.

LNG supply is conditional on execution of a fully termed LNG sale and purchase agreement.

Although a timetable for the transaction's close was not disclosed, Golar GenPower intends to bid at Brazil's A-5 power supply auction.

Last month, the first-ever cargo of LNG exported from the US departed for Brazil. It will be used primarily for power generation.

Alvaro Ríos Roca, managing partner at Gas Energy Latin America, said previously that although Brazil has gas, there is a huge exploratory deficit in the country with no chance of achieving self-sufficiency in the near future.

Wood Mackenzie has highlighted Brazil's "complex above-ground challenges" to further tap the pre-salt.