Tellurian (TELL) And Petronet Sign A MOU Worth $7.5B For LNG
Zacks Investment Research | Sep 22, 2019 10:17PM ET
A Memorandum of Understanding (MOU) has been signed between Tellurian Inc. (NASDAQ:TELL) and Petronet LNG Limited INDIA wherein the latter is said to buy liquefied natural gas from Driftwood LNG, an affiliate of the former.
The agreement is valued at $7.5 billion by dint of which Petronet will invest $2.5 billion for an 18% equity interest in the $28 billion Driftwood LNG terminal and plans to purchase five million tonnes per annum (mtpa) of liquefied natural gas (LNG) from the same unit. The MOU is expected to be finalized by the end of first-quarter 2020. The agreement update would pave the way for the project’s construction to begin next year.
With this deal, Petronet — India’s largest LNG importer — will be capable of supplying pure, affordable and authentic natural gas to India. Moreover, with the rise in use of natural gas, India will be able to enhance its economic growth and achieve the $5-trillion target along with a cleaner environment.
Earlier this year, an authorization by the U.S. Federal Energy Regulatory Commission (FERC) was granted to the Driftwood LNG project and its 96-mile pipeline. The pipeline is designed in a way to interlink the LNG terminal with the U.S. natural gas market.
Together with Driftwood LNG, a proposed approximately 27.6 mtpa liquefaction export facility is expected to be built close to Lake Charles, LA on the U.S. Gulf Coast. The Driftwood project comprises natural gas production, gathering, processing and transportation services.
Tellurian develops low-cost liquefied natural gas projects. The company owns and operates natural gas liquefaction and storage facilities plus loading terminals. Formerly known as Magellan Petroleum Corporation, Tellurian is based in Houston, United States.
Tellurian Inc.
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