Venture Global LNG Reaches $470mn Finance

US LNG export project owner Venture Global LNG has raised additional capital of $108.6mn, bringing the company’s aggregate funding total to $470mn, it said October 16. Morgan Stanley and Goldman Sachs arranged the private placement.

The proceeds will fund Venture's development activities for its proposed LNG export facilities in Louisiana, where it is building both the 10mn metric tons/yr Calcasieu Pass facility on the Gulf of Mexico and the 20mn mt/yr Plaquemines LNG facility in Plaquemines Parish using "highly efficient, mid-scale liquefaction technology." 

Co-CEO Bob Pender said: “Following the recent execution of our binding 20-year sales and purchase agreement with Edison (part of the EDF Group), as well as our previous binding 20-year SPA with Shell North America LNG, this private placement gives our buyers high confidence in our ability to deliver the lowest cost LNG from North America to the global market." The company is working with Baker Hughes, a GE company, as its technology partner. In July, Venture awarded CB&I a $200mn contract to build two storage tanks for the project at Calcasieu Pass.

Venture aims to be a "long-term, low-cost producer of LNG from natural gas production basins in the US." At a time of relatively low LNG prices overseas, companies are focusing more than ever on upstream and midstream cost reductions in the hope of undercutting other projects proliferating along the US coastline and elsewhere in the world.

The two deals are each for 1mn mt/yr – the Shell purchase price linked to Henry Hub, Edison's pricing mechanism not being disclosed – suggesting that a lot more needs to be sold before an investment decision can be taken.

William Powell