Cheniere gets financing for Sabine Pass LNG export trains 3, 4
Houston (Platts)--29May2013/536 pm EDT/2136 GMT
Cheniere Energy Partners has received a needed $5.9 billion in financing
to build trains 3 and 4 of its Sabine Pass Liquefaction Project in Louisiana
and intends to start construction immediately, the company said Wednesday.
Cheniere Partners has also told Bechtel to begin building trains 3 and
4, the company said in a statement.
Sabine Pass Liquefaction, a wholly owned subsidiary of Cheniere
Partners, has closed on credit facilities totaling $5.9 billion, including a
Term Loan A credit facility of $4.4 billion with a syndicate of 27 banks and
financial institutions, the statement said.
It also has closed three additional credit facilities with Republic of
Korea financial institutions -- the Export-Import Bank of Korea and Korea
Trade Insurance Corp. -- for $1.5 billion. The credit facilities mature on
May 28, 2020.
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The credit facilities complete the financing needed to develop, build
and start up the first four liquefaction trains at Sabine Pass, the statement
"We have completed all milestones to start construction on the first
four liquefaction trains being developed by Sabine Liquefaction," Charif
Souki, chairman and CEO, said in the statement.
Construction on trains 1 and 2 began last August and is about 30%
complete, Souki said.
Construction of trains 3 and 4 would start immediately and the first LNG
is expected by late 2015, he added.
The company expects to complete the required resource reports for trains
5 and 6 to file an application by September with the US Federal Energy
Regulatory Commission, Souki said.
Societe Generale acted as sole and exclusive financial adviser to Sabine
Liquefaction in connection with the $5.9 billion of credit facilities, the
statement said. Standard Chartered Bank was a consultant in connection with
the ROK Credit Facilities.
Cheniere Partners has also completed the acquisition of the Creole Trail
Pipeline from subsidiaries of Cheniere Energy, the statement said. The
94-mile pipeline would be used to deliver domestic gas to the liquefaction
project. The company also completed $400 million of financing to fund capital
expenditures needed to reverse the flow of the pipeline, to fund interest
during construction, and for general business purposes.
Cheniere Partners owns 100% of the Sabine Pass LNG terminal, located on
the Sabine Pass deepwater shipping channel less than four miles from the Gulf
Coast. The terminal has regasification facilities that include existing
infrastructure of five LNG storage tanks with capacity of about 16.9 billion
cubic feet, two docks that can accommodate vessels of up to 265,000 cubic
meters, and vaporizers with regasification capacity of about 4.0 Bcf/d.
Cheniere Partners plans to build up to six gas liquefaction trains,
which are in various stages of development, the company said. Each train is
expected to have nominal capacity of about 4.5 million mt/year.
A Cheniere Partners subsidiary, Sabine Pass Liquefaction, has lump-sum
turnkey contracts with Bechtel for engineering, procurement and construction
of trains 1 through 4, the statement said. Sabine Pass Liquefaction has
started building the first four trains and related new facilities needed to
treat, liquefy, store and export natural gas.
Sabine Pass Liquefaction recently began developing trains 5 ang 6 after
starting the regulatory process in February. Construction of trains 5 and 6
and related facilities may start after the company gets regulatory approvals,
financing commitments to fund the trains and makes a final investment
decision, the company said.
Sabine Pass Liquefaction has also entered into third-party LNG
sale-and-purchase agreements with BG for 5.5 million mt/year, Gas Natural
Fenosa for 3.5 million mt/year, Korea Gas for 3.5 million mt/year, Gail
(India) for 3.5 million mt/year, Total Gas & Power for 2.0 million mt/year
and Centrica for 1.75 million mt/year.
Sabine Pass Liquefaction also has an SPA with Cheniere Marketing for up
to 2.0 million mt/year of LNG that is not already committed to third parties,
the company said.
The BG and Cheniere Marketing SPAs start when train 1 begins operating
and the Gas Natural Fenosa SPA starts when train 2 begins operating, the
statement said. The Kogas SPA starts with operations of train 3 and the Gail
SPA with train 4 operations. The Total and Centrica SPAs start with train 5
--Michael Rieke, Michael.firstname.lastname@example.org
--Edited by Derek Sands, email@example.com