Freeport LNG Expansion and IFM Investors announced that IFM Investors has entered into an agreement to invest approximately $1.3 billion of equity funding for Freeport LNG’s proposed natural gas liquefaction and LNG loading facility on Quintana Island near Freeport, Texas.
The facility involves the development of three liquefaction plants, also known as “trains”.
The investment by IFM Investors will provide equity required for the development of Freeport’s second facility. Investment capital will be drawn down over Train Two’s planned 51 to 54-month construction period. The balance of the Train Two capital needs will be sourced from a consortium of project finance lenders. Financial close for the transaction is expected to take place in mid-2014 pending regulatory and other approvals.
“We are thrilled to announce that such a prestigious and well-regarded investment firm has chosen to invest in the Freeport LNG facility,” said Michael S. Smith, Chief Executive Officer, Freeport LNG. “This announcement clearly sends a signal to the financial community about our ability to fund the planned expansion and further solidifies our ability to move forward.”
“This project marks a unique opportunity for us to partner with a highly-experienced senior management team to invest in the rapidly developing LNG sector while maintaining a favorable risk/return profile for our investors,” said Kyle Mangini, Global Head of Infrastructure at IFM Investors.
In February 2013, Freeport LNG executed a 20-year use-or-pay liquefaction tolling agreement with BP Energy Company equivalent to the minimum guaranteed production capacity of Train Two.
LNG World News Staff, December 16, 2013; Image: Freeport LNG