Freeport LNG, Osaka Gas and Chubu Electric Sign $1.2B Equity Agreement

    Freeport LNG, Osaka Gas and Chubu Electric Sign $1.2B Equity Agreement

Osaka Gas and Chubu Electric to Provide Equity Funding for Freeport LNG's
First Natural Gas Liquefaction Facility

PR Newswire

HOUSTON, Feb. 27, 2014

HOUSTON, Feb. 27, 2014 /PRNewswire/ -- Freeport LNG Expansion, L.P. (Freeport
LNG), Osaka Gas Co., Ltd. (Osaka Gas) and Chubu Electric Power Co., Inc.
(Chubu Electric) today announced that Osaka Gas and Chubu Electric have
entered into an agreement with Freeport LNG to invest approximately $1.2
billion of equity funding for Freeport LNG's proposed natural gas liquefaction
and LNG loading facility on Quintana Island near Freeport, Texas. The facility
involves the development of three liquefaction plants, also known as "trains."

The investment by Osaka Gas and Chubu Electric will provide equity required
for the development of Freeport's first train facility (Train One). Investment
capital will be drawn down over Train One's planned 45-month construction
period. The balance of Train One's capital needs is expected to be sourced
from a consortium of lenders comprised of a Japanese government financial
agency and commercial banks. Financial close for the transaction is expected
to take place in the second half of 2014, upon receipt of regulatory

"We are excited to announce our long-term equity partnership with Osaka Gas
and Chubu Electric, our Train One customers and two of the largest Japanese
utilities, which together purchase almost 25 percent of all Japanese LNG
purchases," said Michael S. Smith, Chief Executive Officer, Freeport LNG.
"Combined with the previously announced equity investment by IFM Investors in
our second train facility, the funding to be provided by Osaka Gas and Chubu
Electric satisfies all of the equity capital needs for construction of the
initial two trains of the liquefaction project."

In July 2012, Freeport LNG executed 20-year use-or-pay liquefaction tolling
agreements with Osaka Gas and Chubu Electric equivalent to the minimum
guaranteed production capacity of Train One.

Project Update

On December 10, 2013, Freeport LNG awarded two contracts, each valued at
approximately $2.5 billion, to a joint venture between CB&I, Inc. and Zachry
Industrial, Inc. to construct the initial two trains of the liquefaction
project. Commencement of construction of Freeport LNG's liquefaction project
is subject to receipt of authorization to commence construction from the U.S.
Federal Energy Regulatory Commission (FERC) and final investment decision by
Freeport LNG. Freeport LNG expects to receive FERC approval for the initial
3-train liquefaction project in mid-2014 and to commence construction of the
first two liquefaction trains in the second half of 2014. Construction of the
third liquefaction train is expected to begin in first half of 2015. The
first train is anticipated to commence operations 45 months from start of
construction, with the second and third trains in operation at approximately
six month intervals thereafter.

Freeport LNG has received all authorization required from the U.S. Department
of Energy (DOE) to export the entire LNG production volume of the initial
three trains of the liquefaction project. The minimum production capacity of
the three liquefaction trains has been fully contracted under use-or-pay
liquefaction tolling agreements with Osaka Gas, Chubu Electric, BP Energy
Company, Toshiba Corp. and SK E&S LNG, LLC.

Macquarie Capital is serving as Freeport LNG's financial advisor with respect
to the financing for the Train One project. Documentation pertaining to the
liquefaction project, including regulatory applications and related materials,
is available on Freeport LNG's website at

About Freeport LNG

Freeport LNG Expansion, L.P. is a wholly owned subsidiary of Freeport LNG
Development, L.P., which owns and operates an existing LNG regasification
terminal located near Freeport, Texas. The terminal started commercial
operation in June 2008. Freeport LNG Development, L.P.'s limited partners
are: Freeport LNG Investments, LLLP and FLNGI Option Holdco, LLC, each owned
by Michael S. Smith; ZHA FLNG Purchaser LLC, a Delaware limited liability
company; Texas LNG Holdings, LLC, a wholly owned subsidiary of The Dow
Chemical Company; and Turbo LNG, LLC, a wholly owned subsidiary of Osaka Gas
Co., Ltd.

For further information, please contact:
Lisa Singleton
Brunswick Group for Freeport LNG


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