More Singapore money is being ploughed into an LNG project in the US which now expects to start shipping liquefied natural gas from shale gas projects there in 2015. The LNG will go to Asian markets like South Korea and India initially, and others, including possibly Singapore, later.

Private equity fund RRJ Capital - which together with Temasek Holdings invested US$468 million in Houston-headquartered Cheniere Energy last May - has just put in a further US$310 million in the gas exporter's subsidiary, Cheniere Energy Partners (CEP), which owns its first LNG export terminal at Sabine Pass.

CEP also has a second export terminal at Corpus Christi.

Another Singapore government-linked company, Temasek subsidiary Seatown Holdings, and GSO Capital, the credit investment arm of Blackstone Group, joined RRJ this time, jointly putting up an additional US$60-plus million.

RRJ and Seatown's latest investment in CEP this week follows Government of Singapore Investment Corporation's investment of around US$500 million last August in the Sabine Pass export terminal company.

"The additional investments will help Cheniere, which is currently building the Sabine Pass terminal, to accelerate LNG exports, the first shipments of which are expected to start in mid-2015," sources told The Business Times.

They were commenting on Cheniere's announcement on Monday that it had entered into a purchase agreement with institutional investors to sell 17.6 million common units for net proceeds of about US$372.2 million.

CEP intends to use the proceeds for costs associated with the liquefaction project being developed adjacent to the existing Sabine Pass LNG terminal and general business purposes, the announcement added.

Cheniere is the first US company to get the necessary US government approvals to export LNG from shale gas projects there.

Its Sabine Pass terminal has already sold 16 million tonnes per annum (including to South Korea's Kogas and India's Gail) of the 18 million tpa available from its first phase.

While Temasek and RRJ Capital had earlier planned to set up a Singapore-based marketing joint venture to sell LNG from Sabine Pass' export terminal on the Louisiana/Texas coast to Asia, BT understands that this is no longer needed, given that they now own more "at the top", meaning at Cheniere itself.

With the Singapore LNG terminal here set to start receiving its first LNG shipments from aggregator BG Group in just over a month's time, sources said Cheniere's Sabine Pass was also looking to bring LNG into South-east Asia - especially to Thailand, the Philippines and Singapore - and South Korea.

Cheniere LNG International president Jean Abiteboul told an industry conference in Vienna last month that construction of the Sabine Pass export terminal was "running ahead of schedule" unlike other projects, especially in Australia, which are experiencing cost overruns and delays because of high material prices and labour shortages.

"However, this is not the case in Louisiana. As of today, we are ahead of schedule and in mid-2015, we expect the first exports," he said.

 

 


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