Temasek Holdings Pte. Ltd. and RRJ Capital have agreed to make an equity investment in aggregate of about $468 million in Cheniere Energy Inc.
"Temasek and RRJ Capital have committed to make a significant investment in Cheniere and we look forward to exploring commercial opportunities with our new shareholders," Charif Souki, Cheniere chairman and CEO, said in a May 7 statement. "Their proposed investment would allow us to increase our equity holdings in Cheniere Partners, which we believe is an attractive, long-term opportunity that better aligns us with the Sabine Project and its investors. Additionally, Temasek and RRJ Capital would enhance the further development of our LNG business through their expertise and experience in investments, marketing and trading in Asian markets."
Cheniere said it intends to use the proceeds from this offering and cash on hand to purchase $500 million of the $2 billion of equity securities to be issued by Cheniere Energy Partners LP in connection with the financing of the Sabine Pass LNG Liquefaction Project. Additionally, Temasek, RRJ Capital and Cheniere are in discussions on a strategic partnership focused on developing LNG sales, marketing and trading relationships and opportunities in Asian markets. The partnership would market LNG volumes from the proposed Sabine Pass and Corpus Christi LNG liquefaction facilities.
"We are pleased to confirm that we have recently agreed to invest in Cheniere alongside RRJ Capital," Greg Lanham, managing director for investments at Temasek, an Asian investment company headquartered in Singapore, said in the statement. "Cheniere's established LNG expertise and experience give it the first mover competitive advantage in LNG energy supply. This investment helps to expand our longer term interest in the energy and resources sector. We look forward to working with both Cheniere and RRJ Capital and others to tap into opportunities in Asia which are driven by the energy demand of growing middle income populations and continued urbanization in the decades ahead."
RRJ Capital Chairman and CEO Richard Ongof also expressed excitement over the Cheniere investment. "We strongly support Cheniere and their vision to become a world leader in the global LNG industry, including the key Asian LNG market," he said. RRJ Capital is a private equity firm with a focus on Asia.
Copyright 2012 SNL Financial LC. All Rights Reserved.
(Originally published May 14, 2012, in SNL Energy Gas Utility Week.)