Venture Global (NYSE: VG) has entered into a 20-year Sales and Purchase Agreement (SPA) with Japan-based Mitsui and Co, Ltd. to supply 1.0 million tonne per annum (MTPA) of liquefied natural gas in the year 2029, becoming the third long-term LNG contract with a Japanese company the U.S. company has signed in the year 2021.

Under the newly concluded SPA, Venture Global will supply 1.0 MTPA of LNG to Mitsui over a period of 20 years, and this will further make Japan secure access to the U.S. LNG as it tries to enhance its energy security and diversify its supply sources. The transaction will give Venture Global a cumulative 6.75 MTPA long-term LNG commitment in 2025.

The deal highlights how Japan has continued to implement a policy of ensuring stable LNG imports to deal with the unstable global gas markets and energy restructuring without Russian supply. In the case of Venture Global, the Mitsui alliance can be seen extending its growing presence in Asia after previous deals with Japanese purchasers and can be included in its growing bodies of LNG that are based on the Calcasieu Pass and Plaquemines plants in Louisiana. Both of the projects form part of the Venture Global drive to establish itself as one of the best low-cost producers of U.S. LNG in the world, carrying more than 100 MTPA of capacity in operation, under construction, or development.

The transaction also indicates that Japan is more involved with the U.S. energy companies as it seeks to balance its decarbonization agenda with the requirement of stable fossil-based energy sources. Mitsui, which is already operating throughout the LNG value chain, has had long-standing relationships with the U.S. producers and keeps on investing in projects that can enable its diversified global energy supply system.

Venture Global CEO Mike Sabel also pointed out that the agreement will not only increase energy security but also improve the balance of trade and strengthen the long history of relationships between our countries, as it will occur on an economic and diplomatic level of the partnership.

It has become a significant player in the Gulf Coast LNG export boom because of the integration strategy of the company, starting with natural gas supply, regasification, and shipping. It is also still engaged in carbon capture and sequestration in all its LNG sites, which have been in line with decarbonization trends in the U.S. among exporters.