Summary
Cheniere Energy, Inc. (LNG) announced on August 31, 2005, that its indirect wholly owned subsidiary, Cheniere LNG Holdings, LLC (the Borrower), successfully closed a $600 million credit facility. This facility provides significant funding, with approximately $368 million distributed to Cheniere. These funds are earmarked for strategic growth initiatives, including potential expansion of the Sabine Pass LNG Facility, construction of other LNG receiving terminals, and pipeline development, alongside general corporate purposes. The credit facility is secured by all assets of the Borrower and the equity interest held by its parent. The loan has a maturity date of August 30, 2012, with quarterly principal repayments starting December 31, 2005, and a substantial balloon payment at maturity. Mandatory annual repayments are tied to excess cash flow. The company has also entered into interest rate swap agreements to fix the interest rate on a significant portion of the loan at 7.25% through September 30, 2010.
Key Highlights
- 1Cheniere LNG Holdings, LLC, a subsidiary of Cheniere Energy, Inc., secured a $600 million credit facility.
- 2Approximately $368 million of the credit facility proceeds are available to Cheniere for expansion and development projects.
- 3Funds will be used for expanding the Sabine Pass LNG Facility, constructing new terminals, developing pipelines, and general corporate purposes.
- 4The loan is secured by all assets of the Borrower and the equity interests in the Borrower.
- 5The credit facility has a maturity date of August 30, 2012, with quarterly principal payments and a large balloon payment.
- 6Interest rate swaps have been executed to fix the interest rate at 7.25% for a significant portion of the loan until September 30, 2010.
- 7Reserve accounts totaling approximately $216.2 million were established at closing for debt service, capital contributions, and excess cash flow.