Global Energy Megatrend Acquires the Magnolia LNG Project in Louisiana
Australian-listed Liquefied Natural Gas Ltd. (LNGL) has entered into a binding agreement with UK-based Global Energy Megatrend Ltd. (GEM) to sell its undeveloped Magnolia LNG project in Louisiana.
In February this year, LNGL had disclosed its need for immediate new sources of liquidity, stating that it was evaluating several strategic options to raise capital or sell the company’s assets. Following this, administrators from PwC Australia were appointed to review LNGL’s assets on behalf of its creditors, indicating that the developer was entering bankruptcy or liquidation.
Under the terms of the agreement, GEM will acquire LNGL’s subsidiary entities that own and operate the Magnolia LNG project, including Pecan Inc. (and its subsidiaries), LNG Management Services LLC, and LNG Technology LLC, for a total consideration of US$2.25 million. In addition, GEM will assume any liabilities (including liabilities relating to 16 employees) associated with the project. LNGL’s patented Optimized Single Mixed Refrigerant (OSMR®) liquefaction process technology will also be sold as part of the transaction.
The Magnolia LNG project consists of an LNG export terminal located adjacent to the Calcasieu Ship Channel in Lake Charles district in south-west Louisiana. When completed, the project will be comprised of 4 LNG production trains, each with a plant capacity of 2 million metric tons per annum (MMtpa), with the potential to increase up to total of 8.8 MMtpa. The project also includes 2 LNG tanks of 160,000 cubic meters (m3) capacity each, LNG ship loading facilities for vessels up to 219,000 m3 capacity, and LNG truck loading facilities.
The transaction is scheduled to close by the end of this week.