Venture Global Inc. has secured $3 billion in syndicated borrowings to help fund the under-construction CP2 LNG in Cameron Parish, Louisiana.
“This new capital, on top of the more than $4 billion we have already invested to date, will enable continued fabrication, manufacturing and procurement at an accelerated pace, similar to Plaquemines”, Venture Global chief executive Mike Sabel said in an online statement. Sabel was referring to another Venture Global liquefied natural gas (LNG) project in Louisiana that dispatched its first cargo about two years earlier than the normal Energy Department timeframe.
In March the Department of Energy (DOE) granted a conditional permit for CP2 LNG to export to countries with no free-trade agreement (FTA) with the United States. The project has already secured authorization for its export volume, the equivalent of about 1.45 trillion cubic feet a year of natural gas, when it won FTA export approval April 2022.
A final permit for the non-FTA portion has been withheld pending a DOE review of permitting considerations concerning greenhouse gas emissions, environmental impact, energy prices and domestic gas supply. “DOE expects to issue a final order to CP2 LNG in the coming months”, the department said in an online statement March 19.
The loan from a group of 19 banks follows the launch of CP2 LNG’s FID (final investment decision) process in March.
SMBC served as left lead arranger and sole bookrunner. Caixabank and LBBW served as right lead arrangers. Bank of America, BBVA, Deutsche Bank, ING, Goldman Sachs, JP Morgan, Mizuho, MUFG, NBC, RBC, Santander, Scotiabank and Wells Fargo served as coordinating lead arrangers. ICBC, NordLB and Regions served as joint lead arrangers.
Last month Venture Global closed a two-tranche offering of senior secured notes with a principal amount of $2.5 billion for the Plaquemines LNG facility in Plaquemines Parish.
The debt instrument sale comes after Venture Global proposed around $18 billion in investment to grow the facility’s capacity to over 45 million metric tons per annum (MMtpa).
Venture Global Plaquemines LNG LLC (VGPL) plans to use proceeds to “prepay certain amounts outstanding under VGPL’s existing senior secured first lien credit facilities”, Venture Global said in an online statement April 21.
Plaquemines LNG shipped its first cargo, from phase 1, last December. Phase 2, which the company approved 2023, is expected to start operation this year. Phases 1 and 2 have a total permitted capacity of 27.2 MMtpa, though phase 2 has yet to obtain non-FTA authorization.
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