Magnolia LNG Signs Site Lease Option Agreement, USA

Liquefied Natural Gas Limited announced the signing of a Site Option to Lease Term Sheet (Site Term Sheet) with the Lake Charles Harbour and Terminal District Authority (Port Authority), in relation to LNG Ltd’s proposed Magnolia LNG Project (MLNG).

The Site Term Sheet includes the agreed key terms of a proposed definitive and exclusive Site Option to Lease and the actual Site Lease. Key terms include:

• 3 year term to exercise the option to lease, subject to the payment of nominal annual option fees. The 3 years is to allow MLNG adequate time to obtain all necessary approvals prior to committing to the full terms of the Site Lease.
• On exercise of the option to lease, an initial Site Lease term of 30 years, with 4 x 10 year extension terms, exercisable at MLNG’s sole discretion subject to MLNG being in full compliance with the terms of the Site Lease.
• Agreed Site Lease annual rent payments, Minimum Annual Guaranteed fee (based on 2 million tonnes per annum (mtpa) of LNG production), and a Throughput Fee for LNG production in excess of 2 mtpa.
• Ability to develop an LNG export and/or import facility, subject to the obtaining, and compliance with, all necessary approvals.

Managing Director and Joint CEO Maurice Brand said that “the support being offered by the State of Louisiana, as evidenced by the 19 January 2013 MLNG project announcement by the Louisiana Economic Development Board and by the Lake Charles Port Authority, in the efficient and pragmatic manner in which the key terms of the proposed Site Lease have been negotiated, is greatly appreciated and augers well for the timely completion and execution of the definitive agreements.”

“I am very excited about the development team and consultants that have been, and are being, added to our MLNG development team and the contractors and potential partners who are expressing interest in MLNG.”

Magnolia LNG Project:

The project comprises the proposed development of an 8 mtpa LNG project on a 90 acres site, in an established LNG shipping channel in the Lake Charles District, State of Louisiana, United States of America. The development is based on the staged development of 4 x 2 mtpa LNG production trains using LNG Ltd’s wholly owned OSMR® LNG process technology and the completed LNG plant front end engineering and design of LNG Ltd’s Gladstone Fisherman’s Landing LNG Project in Queensland, Australia.

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LNG World News Staff, January 29, 2013; Image: LNG Ltd