Tellurian (NASDAQ:TELL) has always been considered a high-risk, high-potential reward sort of company, with a great deal of uncertainty about whether the risk would pay off. In May, the company announced solid progress in its natural gas export plan, causing the stock to gain 96.8%, according to data provided by S&P Global Market Intelligence.
So what
Tellurian s business is built around a plan to export liquefied natural gas (LNG). In theory, it is a huge potential opportunity: North America has ample supplies of low-cost natural gas, and when liquified, that gas can be shipped in large quantities to markets where it is in demand.
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US-based Tellurian has signed a long-term agreement with commodity trader Gunvor Group for three million tonnes per annum (Mtpa) of LNG.
Tellurian will supply the LNG to Gunvor Singapore from the proposed Driftwood LNG in the US on free on board (FOB) basis for ten years.
Located near Lake Charles, Louisiana, the Driftwood LNG project involves the construction of a 27.6Mtpa LNG terminal and 154.5km of feed gas pipeline. It is being developed in four phases.
Tellurian president and CEO Octávio Simões said: “Tellurian intends to market up to 10 mtpa of LNG in our first phase on a JKM, TTF or blended price basis, as our integrated model provides the flexibility to offer this valuable product.