Cheniere upsizes Sabine LNG project loan
Houston-based energy company Cheniere Energy has upsized its credit facility for the Sabine Pass LNG project to US$3.4bn, after withdrawing its previous syndication of US$1.25bn.
Société Générale tells GTR that it is acting as the financial advisor and mandated lead arranger on the deal, along with seven other undisclosed banks.
The seven-year facility will be used to fund the costs of developing, constructing and placing two liquefaction trains at Cheniere’s Sabine Pass LNG project in Louisiana.
Cheniere says it expects to complete the debt financing commitments with the eight participating banks by the end of July.
The loan carries an interest rate of Libor plus 350 basis points (bps) during construction, stepping up to Libor plus 375 bps during operations.
Cheniere Energy has also secured US$2bn in equity commitments from US private equity firm Blackstone Group; increasing the project’s total funds to US$5.4bn.
"Our credit facility will be one of the larger facilities in the project financing market, underlying the strong fundamentals of the transaction. Our ability to access a very large credit facility will significantly reduce our costs of financing during construction,” says Charif Souki, chairman and CEO of Cheniere Energy.
The liquefaction facilities will be able to cool gas to minus 260 degrees for overseas export. Korea Gas, BG Group, Gas Natural SDG and Gail India have agreed to buy a combined 16 million tonnes a year from the Sabine Pass terminal, Cheniere says in a statement.
The project will start operations in 2015.