Freeport LNG Expansion LP reports that its subsidiaries, FLNG Liquefaction LLC and FLNG Liquefaction 2 LLC have closed on debt and equity financing commitments of $11 billion in capital required for the development of the initial two trains of Freeport LNG's natural gas liquefaction and LNG loading facility on Quintana Island near Freeport, Texas, making it the largest fully non-recourse construction project financing ever.
Commitments in excess of the anticipated $9.64 billion in project costs, inclusive of financing costs, provide significant buffer for contingencies and cost overruns to ensure successful completion.
With closing on financing, Freeport LNG has completed all milestones and issued a full notice to proceed to CB&I Inc. and Zachry Industrial Inc. to construct the first two liquefaction trains of the Freeport LNG liquefaction project. Financing and commencement of construction on the third liquefaction train is expected in the second quarter of 2015. The first liquefaction train is expected to start operations in the third quarter of 2018, with the second liquefaction train expected to begin operations five months thereafter.
For the first liquefaction train, $4.369 billion in debt financing is being provided by Japan Bank for International Cooperation (JBIC) and the following six commercial banks: The Bank of Tokyo-Mitsubishi UFJ Ltd., Sumitomo Mitsui Banking Corp., Mizuho Bank Ltd., Sumitomo Mitsui Trust Bank Ltd., Mitsubishi UFJ Trust and Banking Corp., and ING Bank NV–Tokyo Branch. The portion of the loans financed by the commercial banks is insured by Nippon Export and Investment Insurance (NEXI). Osaka Gas Co. Ltd. and Chubu Electric Power Co. Inc. are committed to invest $1.24 billion for the development of the first train.
For the second liquefaction train, $4.025 billion in debt financing is being provided by a syndicate of 25 commercial banks under a seven-year mini-perm construction facility. IFM Investors is committed to invest $1.3 billion in equity for the development of the second train.