Summary
Cheniere Energy, Inc. (LNG) filed an 8-K on January 31, 2007, reporting a material definitive agreement through its wholly-owned subsidiary, Cheniere Creole Trail Pipeline, L.P. (CCTP). CCTP entered into a purchase order with The Bayou Companies, LLC for the application of external concrete weight coating to approximately 43.3 miles of pipeline. This agreement is a critical step for the CCTP pipeline project, which is designed to traverse marsh and marine environments where buoyancy of the pipe is a concern. The total cost of the coating work is approximately $22.3 million, with initial payments and progress payments outlined. The project is scheduled to commence in March 2007 and is expected to take about 18 weeks to complete.
Key Highlights
- 1Cheniere's subsidiary, CCTP, has entered into a significant agreement for pipeline coating.
- 2The agreement with The Bayou Companies, LLC is for concrete weight coating on 43.3 miles of pipe.
- 3The coating is necessary due to the pipeline's route through marsh and marine environments to prevent flotation.
- 4The total cost of the concrete weight coating is approximately $22.3 million.
- 5Payment terms include an initial $2 million for raw materials and subsequent progress payments.
- 6Work is scheduled to begin around March 19, 2007, with an estimated completion by mid-July 2007.
- 7CCTP retains the right to terminate the agreement for convenience, subject to payment obligations.
Frequently Asked Questions
This 8-K filing reports a material definitive agreement entered into by Cheniere's subsidiary, Cheniere Creole Trail Pipeline, L.P. (CCTP), for the application of concrete weight coating to a significant portion of its pipeline.
The coating is essential because large sections of the CCTP pipeline will be laid through marsh and marine environments. The concrete weight is required to prevent the pipeline from floating due to its natural buoyancy in these water-heavy areas.
The total cost for the external application of concrete weight coating is approximately $22.3 million. This will be paid through an initial $2 million for raw materials and subsequent progress payments as the work is completed.
Work is scheduled to begin around March 19, 2007, and is estimated to take approximately 18 weeks to complete, with the final delivery anticipated for the week ending July 16, 2007.