U.S. energy firm Sempra has signed a non-binding agreement with Saudi Aramco to supply liquefied natural gas from Phase 2 of the Port Arthur project in Texas, the companies said on Wednesday.

Aramco aims to buy 5 million tonnes per annum of LNG for 20 years and make a 25% equity investment in the proposed Phase 2 expansion, according to the deal terms.

In March, Reuters reported that Aramco was in talks to invest in the Port Arthur project.

"As a potential strategic partner in the Port Arthur LNG Phase 2 project, Aramco is well placed to grow its gas portfolio," Nasir Al-Naimi, Aramco Upstream president, said in a statement.

This is Aramco's second LNG supply deal in the U.S. in recent weeks, as the Saudi energy giant seeks to strengthen its position in the LNG market, especially in the U.S., where LNG capacity is set to almost double over the next four years.

The company has signed a 20-year LNG supply deal with U.S. LNG firm NextDecade and has reportedly held talks with Tellurian for a stake in its Driftwood LNG plant.

Sempra's proposed phase 2 of Port Arthur LNG project is expected to add up to two trains capable of producing up to 13 Mtpa of the super-chilled fuel.

 

(Reporting by Sourasis Bose in Bengaluru; Editing by Sriraj Kalluvila)