LNG signs on partner for Magnolia
PERTH (miningweekly.com) – Perth-based Liquefied Natural Gas (LNG) has entered into a term sheet with US-based Stonepeak Partners regarding the development of the Magnolia LNG project, in Louisiana.
The term sheet would allow the two parties to enter into negotiations regarding the development of the Magnolia project, which would see Stonepeak provide the project’s full equity finance requirement for construction and commissioning.
An initial development plan for the Magnolia project has determined that it would consist of two LNG trains, with a total capacity of four-million tonnes a year, costing some $660-million to develop.
Stonepeak would hold a 50% interest in the project in exchange for contributing the full project equity requirement.
The project’s total capital cost has been placed at $2.2-billion, and LNG has said that it would finance the Mongolia project based on a 70% debt financing and 30% equity financing.
“The company is extremely pleased with the strategic alliance with Stonepeak and its early commitment to provide 100% of the Mongolia equity from financial close,” said LNG MD Maurice Brand.
“This early equity commitment will allow the Magnolia project to proceed in a timely manner and reduces the time from receipt of all permits and environmental approvals and completion of all bankable project documentation, to achieve financial close and proceed to construction.”
Brand added that, in addition, the agreement also provided an increased level of confidence for LNG tolling parties and other stakeholders in the project.
The parties would now proceed to progress definitive agreements within the agreed-upon 60-day period.
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