UPDATE: Temasek, RRJ Capital Invest $468 Million In Houston-Based Cheniere Energy
May 07 2012 - 11:29PM
Dow Jones News
Singapore state investment firm Temasek Holdings Pte. Ltd. and
Hong Kong-based private equity group RRJ Capital will jointly
invest US$468 million in Houston-based liquefied natural gas firm
Cheniere Energy Inc. (LNG) as the firms look to increase their
exposure to energy assets and emerging markets.
Cheniere Energy said Monday in a statement it plans to use
proceeds of the investment to purchase US$500 million of the US$2
billion in securities to be issued by its subsidiary, Cheniere
Energy Partners, L.P. (CQP), which owns key liquefaction assets and
will use its capital raising to finance an expansion of these
facilities.
Last month, Cheniere Energy received federal approval to build
what would be the first major natural gas export facility in the
lower 48 U.S. states, putting the company a step closer to shipping
some of America's newly abundant gas abroad. The project would
allow Cheniere to become the only large-scale liquefied natural gas
exporter in the U.S.
Cheniere still must find about $4 billion in financing to build
and develop the export facility, a final step it hopes can be done
within the next six months. The company on Monday announced it was
working with eight banks to arrange the necessary financing.
Cheniere in February secured $2 billion for the project from
Blackstone Group LP (BX).
Cheniere said that Temasek and RRJ Capital are also in talks on
a partnership focusing on developing LNG sales, marketing and
trading relationships in Asian markets.
Greg Lanham, a managing director at Temasek, said the investment
will help the group tap into opportunities in Asia which are driven
by the energy demand of the growing middle income population.
According to its 2011 annual review, 3% of Temasek's S$193
billion asset portfolio was allocated to energy and resources
assets as of March 31, 2011, up from 2% a year earlier. Last month,
Temasek and RRJ Capital, a US$2.3 billion established by former
Goldman Sachs Group Inc. banker Richard Ong, bought shares in a
US$1.35 billion share placement by Hong Kong-listed crude oil and
natural gas company Kunlun Energy Co. (0135.HK), according to a
person familiar with the transaction. Last week, Temasek sold
shares in Chinese lenders lenders Bank of China Ltd. (3988.HK) and
China Construction Bank Ltd. (0939.HK) via placements, raising a
total of US$2.48 billion.
Cheniere Energy operates the Sabine Pass LNG terminal in
Louisiana through its 90.6%-owned Cheniere Energy Partners, as well
as the Creole Trail Pipeline, which connects the Sabine Pass
facility with downstream markets.
Its proposed Sabine Pass liquefaction project would convert the
existing terminal at the site into a two-way facility that could
liquefy and export natural gas as well as import and regasify
foreign-sourced LNG.
-By Sam Holmes, Dow Jones Newswires; +65-6415-4157;
samuel.holmes@dowjones.com
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