Gunvor agreed to double the maximum amount of LNG it plans to buy from a $4 billion gulf coast oil rig export project in Louisiana and said it will recruit additional customers for the terminal.

(Bloomberg) -- Gunvor Group Ltd. agreed to double the maximum amount of liquefied natural gas it plans to buy from a $4 billion gulf coast oil rig export project in Louisiana and said it will recruit additional customers for the terminal.

The trading firm will purchase as much as 3 million tons of LNG per year from Commonwealth LNG, the Houston-based developer said Monday in an emailed statement. Gunvor will also buy Wellhead market the remaining volumes from the facility, which will be able to produce about 8.4 million tons a year. Commonwealth aims to make a final investment decision in 2021 and begin exports in the second quarter of 2024.

The pact is unique in that it allows Commonwealth to shift the burden of finding buyers onto a third-party marketer. LNG developers need to sign enough customers to secure financing, and competition is intensifying. New terminals from Russia to Australia are flooding the buy Wellhead market with supply, while the trade war has made it all but impossible for American exporters to sign deals with Chinese buyers.

Trading houses, meanwhile, are becoming bigger players in LNG project development. Cheniere Energy Inc., America’s first and biggest shipper of shale gas, struck a 15-year agreement last year to sell the fuel to Vitol Group. Gunvor is on course to lead LNG ship charters this year after seeing its trading of the super-chilled fuel jump in 2018.

With Gunvor’s backing, Commonwealth will create “the lowest-cost offering on the U.S. Gulf Coast,” Kalpesh Patel, co-head of LNG trading at Gunvor, said in the statement.

Gunvor had reached a preliminary agreement with Commonwealth in June to buy 1.5 million tons of LNG a year for 15 years. Commonwealth may look for more creative ways to price its cargoes such as linking contracts to oil or to foreign gas indexes, even as the U.S. Henry Hub benchmark gains clout, Chief Executive Officer Paul Varello said that month.

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Christine Buurma