California-based utility holding Sempra (NYSE: SRE) has signed a partnership agreement with a Japanese consortium to explore the possibility of establishing a synthetic natural gas facility along the U.S. Gulf Coast, the company said in a statement Wednesday.
Its subsidiary Sempra Infrastructure, based in Houston, will partner with Japan’s trading major Mitsubishi Corp (TYO: 8058) and gas utilities Tokyo Gas, Osaka Gas and Toho Gas for this venture.
The project aims to produce 130 million metric tons of synthetic natural gas, known as e-gas, annually by combining renewable hydrogen with carbon dioxide (CO2) extracted from the atmosphere.
Once produced, the e-gas will be transported to Sempra’s existing liquefied natural gas (LNG) facility in Louisiana, where it will be converted into a liquid and exported to Japan.
The proposed e-gas facility could serve as a commercial solution for the increasing amounts of captured CO2 along the Gulf Coast, aligning with climate change mitigation efforts, according to the statement.
Moreover, the project is strategically located to leverage the existing network of gas pipelines, processing facilities, and the emerging hydrogen infrastructure in the region.
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The current collaboration aligns with Mitsubishi’s existing 16.6% stake in Sempra’s Cameron LNG project, further strengthening their collaboration in this sector.
Justin Bird, CEO of Sempra Infrastructure, emphasized that this project could utilize the global LNG supply chain and gas distribution systems worldwide to deliver a long-term, carbon-neutral fuel.
Additionally, Sempra has ambitious plans to construct a $13-billion LNG facility in Port Arthur, marking their continued commitment to advancing the energy industry and sustainability efforts.
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