Magnolia LNG

Magnolia LNG is a proposed liquefied natural gas export terminal planned near Lake Charles. 

The buyer of the Magnolia LNG export terminal in Lake Charles stepped forward this week after the $2 million deal closed in late May. 

The liquefied natural gas export project was sold by LNG Ltd. to Magnolia LNG Holdings LLC, a Delaware-based entity incorporated on May 7. The buyer is owned by New York-based Glenfarne Group LLC, the company disclosed on Tuesday. 

Glenfarne Group is a privately held industrial energy developer and operator with plans to complete the LNG project.

“Magnolia LNG is a well-known and high-quality project,” Brendan Duval, founder of Glenfarne, said in a news release. 

The company expects to bring funding, marketing, development and construction experience to build and then operate the terminal once it opens. The project has not yet reached a final investment decision, which would mean it has customers and lenders willing to back the project.

Glenfarne also is the majority owner through subsidiary Alder Midstream LLC of an LNG project in south Texas, Texas LNG Brownsville LLC, a 4 million tons per year export terminal. The project has a state air permit and federal permits, but has not yet begun construction.

LNG Ltd. was the parent company of Magnolia LNG and is based in Australia. The company is in the equivalent version of bankruptcy in that country. A previous deal worth $2.25 million between LNG Ltd. and Global Energy Megatrend Ltd. fell through in mid-May. 

The new purchase agreement includes an unsecured noninterest bearing promissory note worth $1.3 million, if the Magnolia LNG project raises enough capital to begin construction. 

The new buyer also agreed to work with LNG Ltd. on a potential recapitalization of the company, expected to be completed on Nov. 30. The deal includes the permits, land, detailed engineering plans and a contract for development, in addition to the underlying technology related to the LNG project. 

Several months ago, LNG Ltd. was expected to be sold in a $75 million deal to Singapore-based LNG9 Ltd., but investors pulled out of that deal after a loan fell through.

Magnolia LNG was expected to export 8.8 million tons of LNG each year, but has not started construction. The project already has permits from the Federal Energy Regulatory Commission.

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Email Kristen Mosbrucker at kmosbrucker@theadvocate.com.