Total Agrees to Buy LNG from Louisiana Facility

  • Jul 11, 2019
  • Rigzone

Subsidiaries of Total S.A. have agreed to purchase liquefied natural gas (LNG) from Tellurian Inc.’s proposed Driftwood liquefaction terminal near Lake Charles, La., and increase the France-based multinational’s stake in Driftwood Holdings LP, Tellurian reported Wednesday.

“The agreements we have executed with Total confirm the business model for the Driftwood project, establishing it as an LNG joint venture with an implied value of $13.8 billion,” Tellurian President and CEO Meg Gentle said in a written statement.

The definitive agreements between Total units and Tellurian include:

Tellurian stated the agreements with Total hinge on certain closing conditions, including the final investment decision (FID) to construct Driftwood. In April of this year, Total also agreed to purchase approximately $200 million worth of Tellurian common stock based on the FID and other conditions. Given Total’s original $207 million investment in Tellurian several years ago, its aggregate stake in Tellurian’s portfolio would hit $907 million at FID.

“The Tellurian team thanks Total for their leadership and we look forward to beginning the largest privately funded U.S. infrastructure project,” stated Gentle. “We intend to finalize the agreements with the remaining partners and make FID in 2019. At full capacity, Driftwood will be capable of exporting approximately 4 billion cubic feet per day of natural gas, providing solutions for the acute U.S. oversupply and delivering cleaner air to the world.”

According to Tellurian, the proposed 27.6-mtpa Driftwood LNG facility and associated pipeline have received all necessary permits and licenses to begin construction.

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