Marathon Oil announced on Monday that it entered into a five-year liquefied natural gas (LNG) sales agreement with Glencore Energy UK Ltd, a subsidiary of Glencore PLC for a portion of its equity natural gas produced from the Alba Field Equatorial Guinea.

The Houston-based firm, which has a 64% working interest in the Alba Unit, said in its press release that the sales deal is effective Jan. 1, 2024.

The pricing structure for the agreement will be linked to the Dutch Title Transfer Facility (TTF) index, replacing the previous contract that was linked to the Henry Hub.

“I’m excited to announce this new sales agreement linked to the European LNG market, signaling the conclusion of the legacy Henry Hub linked contract,” said chairman, president, and CEO Lee Tillman.

“The timing of this new sales agreement, EG LNG’s track record of reliable operations, and the plant’s proximity to Europe resulted in tremendous demand and an extremely competitive process. At recent forward curve pricing, we expect to realize an approximate year-on-year EBITDA increase of over $300 million next year across our E.G. integrated gas business, reflecting our differentiated and increasing exposure to the global LNG market. This success positions us strongly for the next phase of opportunities to advance the E.G. Gas Mega Hub, including up to two infill development wells in the Alba Unit and the potential tie-in of the third-party Aseng gas cap monetization,” Tillman added.

Alex Sanna, Head of Oil and Gas Marketing, Glencore PLC, said: “We are delighted to further expand our cooperation with Marathon Oil. This deal reconfirms our commitment to the growth and diversification of our LNG portfolio as we continue to support producers and end users as a reliable and responsible off-taker and supplier.”

Notably, this agreement had a positive impact on Marathon Oil’s stock, with shares rising approximately 1% in after-market trading.