Energy company Stabilis Solutions has ended a decade-long LNG offtake agreement connected to its proposed liquefaction facility in Galveston, Texas, according to Ship & Bunker. The termination was disclosed in an SEC filing dated March 31.
Deal Details
The agreement, executed through Stabilis subsidiary Stabilis GDS, Inc., had called for the delivery of approximately 50 million gallons of LNG annually to an unnamed global marine operator. As reported by Ship & Bunker, this volume would have accounted for around 40% of the proposed facility’s planned output capacity of 350,000 gallons per day, with minimum volume commitments representing roughly 32% of that capacity.
The original deal was conditional on the Galveston plant being successfully financed, built, and commissioned.
Why the Deal Fell Apart
According to Ship & Bunker, the termination is tied directly to Stabilis’s ongoing efforts to secure third-party financing for the Galveston project. During negotiations with potential funding partners, Stabilis was asked to amend specific terms within the offtake agreement as a prerequisite for financing approval. The unnamed counterparty declined to accept the requested modifications, which ultimately led Stabilis to cancel the contract.
Background
The development follows Stabilis Solutions’ previously announced 10-year agreement with cruise company Carnival Corporation to provide LNG bunkering services to Carnival’s fleet operating out of Galveston, Texas — a deal reported by Ship & Bunker as having been signed last year.
The cancellation of the offtake agreement raises questions about the forward progress of the broader Galveston liquefaction facility, though Ship & Bunker does not report any further announcements regarding the project’s status at this time.
Gulf Bunkering does not provide operational or security guidance. This article is for informational purposes only. Operators should consult flag state authorities, P&I clubs, and relevant advisories for decisions relating to transit planning.
Sources: Ship & Bunker
