Tellurian Sees Interest in Driftwood LNG Stakes
US LNG developer Tellurian, which has proposed the 27.6mn metric tons/year (mt/yr) Driftwood LNG project in Louisiana, said May 9 there is strong interest in its offer to sell equity partnerships in the $18bn integrated project.
Tellurian has developed a new business model for Driftwood, offering equity participation in Driftwood Holdings for $1.5bn payable over a four-year period in exchange for rights to 1mn mt/yr of LNG offtake. Tellurian would retain between 7mn and 11mn mt/yr for itself.
“There are more than 20 companies conducting detailed analysis in our data room for Driftwood Holdings and we expect to be able to identify our partners soon,” Tellurian CEO Meg Gentle said in releasing the company’s first quarter results. “We intend to begin construction of the Driftwood LNG terminal in 2019 and produce first LNG in 2023.”
Besides the liquefaction terminal, Driftwood LNG includes the $2bn Driftwood Pipeline, which would deliver up to 4bn ft3/day of natural gas to the terminal, and equity interests in an estimated 1.4 trillion ft3 of natural gas reserves in the low-cost Permian Basin of Texas and New Mexico.
In 1Q 2018, Tellurian generated revenue of about $6mn from LNG marketing and about $1mn from natural gas sales. Net loss for the quarter was $25.2mn.