Monday, February 27, 2012

Cheniere Gets $2 Billion Financing for LNG Export

Cheniere Energy announced today that it received a $2 billion equity investment from the Blackstone Group (press release).  The investment will partially fund the $4.5 to $5 billion needed to build two of the planned four liquefaction trains, with the remainder to be funded through debt.  Construction is expected to begin in the first half of 2012.

This is big news for gas fans, as equity financing is usually the harder piece of the funding puzzle to secure (at least in a normal banking environment - which this is finally starting to become).

Wouldn't it be interesting in a few years to see the United States as a net gas exporter?  Don't think the concept of "energy independence" is that far-fetched.  Between abundant natural gas supplies to satisfy domestic needs, natural gas exports, increased domestic oil production, increased vehicle fuel efficiency and the increased exports of coal (especially as natural gas displaces coal for power generation), the U.S. stands a good chance of being energy independent (assuming your definition of "energy independent" is being a net energy exporter and not just avoiding the purchase of oil from the Middle East).  For fun, read Thomas Friedman's column from yesterday's New York Times about the question, "should the U.S. join OPEC?"

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