Sumitomo and Tokyo Gas have established the joint venture company ST Cove Point in order to carry out contracted gas liquefaction processing and LNG sales for the Cove Point LNG Project (5.25 Mt/year) in the US state of Maryland. The Project aims to procure US-produced natural gas through Pacific Summit Energy (PSE), a wholly-owned subsidiary of Sumitomo, and export about 2.3 Mt/year of LNG liquefied by Dominion Cove Point LNG, the Operator of the Project. A license for exporting LNG to countries with which the US has no free trade agreement (FTA) was obtained from the US
Department of Energy in September 2013, and Dominion plans to start commercial operations in 2017.
Under the terms of the agreement, ST Cove Point will benefit from the 2.3 Mt/year tolling agreement at Cove Point LNG ; Tokyo Gas will purchase up to 1.4 Mt/year of LNG from the plant over 20 years, while Sumitomo will purchase up to 0.9 Mt/year of LNG over 20 years. Sumitomo will then resell 0.8 Mt/year to Japanese power utility Kansai Electric.
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