Tangguh LNG Train 3 Financing Advances

7 March 2016: Financing for Tangguh’s third liquefaction train progressed in late January when sponsors, advised by Societe Generale, sent out an information memorandum to banks. Financing proposals are due March 31 and financial close is expected June 30, 2016. Sponsors are preparing the financing to lay the ground for train 3’s final investment decision, expected late this year. Tangguh is raising $5 billion of debt facilities, with an additional $7 billion from the equity partners. The commercial tranche is $3.25 billion, while the Japan Bank for International Cooperation (JBIC) is expected to provide $1.25 billion and the Asian Development Bank will lend $500 million. Costs are estimated at $8 billion to $12 billion. Commercial bids for construction are due in February, and costs are expected to fall with lower oil prices and fewer projects competing for engineering, construction and procurement services. The debt facility will fund the onshore LNG plant and its facilities and includes estimated financing costs of $460 million to $500 million, while offshore development is being funded by equity. The existing two trains have robust cash flows that will fund part of the capital expenditure for the third train. Please fill out form below to view article.