Tellurian Sets $50mn Financing

US LNG developer Tellurian said April 28 it had executed an agreement to sell $56mn of zero coupon, unsecured notes for gross proceeds of $50mn. The lender will also receive warrants to purchase up to 20mn Tellurian common shares, subject to customary closing conditions.

Along with the financing, Tellurian has also entered into an agreement to amend its 2019 term loan, reducing the principal amount by $17.1mn by paying down $2.1mn with cash, converting $15mn of principal value into equity through the issuance of 9.3mn common shares and providing the lender with warrants to purchase up to 4.7mn additional common shares.

Accounting for the financing transaction on a pro forma basis, Tellurian’s unaudited cash and cash equivalents balance as at March 31, 2020 is estimated at $100.7mn, the company said.

“Tellurian is building cash reserves during this challenging time in global markets, positioning for a strong emergence from Covid-19 restrictions,” CEO Meg Gentle said. “We remain bullish on long-term natural gas demand growth, underscoring the acute need for Driftwood LNG.”