Freeport LNG Announces Japanese Financing for Development of Train One
Freeport LNG on Wednesday announced it has secured $3.8 billion debt financing from Japanese commercial banks for its LNG project’s first train facility (Train One).
The debt financing is being provided by Japan Bank for International Cooperation (JBIC) and six other commercial banks for the development of Freeport LNG’s first train facility at its proposed natural gas liquefaction and LNG loading facility on Quintana Island near Freeport, Texas.
Freeport LNG also said that pursuant to their previously announced agreement, Osaka Gas and Chubu Electric are investing approximately $1.2 billion for the development of Train One.
“We are excited to announce our partnership with Japanese governmental institutions to support the financing needs of the Freeport LNG liquefaction facility and to become a key contributor to the long-term diversification and security of energy supplies to Japanese utilities,” said Michael S. Smith, Chief Executive Officer, Freeport LNG. “We look forward to commencing construction of the initial two trains of the liquefaction project in the coming weeks and beginning commercial exports in 2018.”
The company said it plans to announce financing agreements soon for a second train and expects to secure funding and start construction on the third train in first half of next year. The project has conditional approval from the federal government to export 1.8 billion cubic feet per day of natural gas to countries that lack free-trade agreements with the United State.
Each liquefaction train has a nameplate design capacity of 4.64 million tonnes per annum. Approximately 13.2 million tonnes per annum of the production capacity of the three liquefaction trains has been contracted under use-or-pay liquefaction tolling agreements with Osaka Gas, Chubu Electric, BP Energy Company, Toshiba Corp. and SK E&S LNG, LLC.
Freeport LNG Development, L.P.’s limited partners are: Freeport LNG Investments, LLLP and FLNGI Option Holdco, LLC, each owned by Michael S. Smith; ZHA FLNG Purchaser LLC, a Delaware limited liability company; Texas LNG Holdings, LLC, a wholly owned subsidiary of The Dow Chemical Company; and Turbo LNG, LLC, a wholly owned subsidiary of Osaka Gas Co., Ltd.