US Cheniere Secures Midship Finance

US Cheniere has achieved "important regulatory and financial milestones" that advance its plans for Midship, a 200-mile (320-km) 36-in interstate gas pipeline. It could be operational in late 2018-early 2019, it said June 2.

The pipeline will carry gas production from the Stack and the Scoop plays in the Anadarko Basin to the US Gulf Coast, including to Cheniere's liquefaction plants, said CEO Jack Fusco, announcing regulatory filing for the line.

On the finance side, funds managed by US private equity firm EIG Global Energy Partners have committed to invest up to $500mn in Midship. Upon achievement of the final investment decision, the EIG Investment, and equity contributed by Cheniere, is intended to ensure that the project has the equity funding expected to be required to develop and construct up to the full project design of 1,440,000 dekatherms/day (1.3bn ft³/d) of throughput capacity. Credit Suisse acted as exclusive financial advisor to Cheniere on the EIG Investment.

EIG worked with Cheniere on the Corpus Christi LNG terminal complex, under construction and expected to produce first LNG next year. The five-train project in Texas will have expected nominal production capacity of up to 22.5mn mt/yr. It will be Cheniere's second export complex, after Sabine Pass.

As previously disclosed, Midship has secured commitments from subsidiaries and/or affiliates of Cheniere, Devon Energy, Marathon Oil and Gulfport Energy to support around the first two thirds of capacity.

Midship Holdings would require acceptable financing arrangements, which may include project financings and offerings by it or its subsidiaries of debt or equity, and regulatory and other approvals before the proposed project begins construction.

William Powell