Chadbourne Advises Lenders and Export Credit Agencies in Sabine Pass Financing Deal (USA)

Chadbourne acted as counsel to lenders and Korean export credit agencies in the closing of project finance debt facilities totaling US$6 billion for Cheniere Energy Partner’s US$12 billion Sabine Pass Liquefaction Project.

When its construction is completed, Sabine Pass LNG will become the first bi-directional LNG facility in the world capable of both gasifying imported LNG and liquefying domestic natural gas supplies for export. Chadbourne represented approximately 40 commercial banks and other financial institutions, Korean ECAs, and other Korean policy development institutions that participated in the debt facilities.

“This project represents a tremendous milestone with significant implications for the global LNG industry and the US energy sector, as well as for the geopolitical landscape,” said partner Noam Ayali, who with partner Benjamin Koenigsberg led the Chadbourne team on the transaction.

“Speaking for our whole team, we are delighted to have had the opportunity to work on this groundbreaking financing,” added partner Benjamin Koenigsberg.

The Phase I financing for Sabine Pass, on which Chadbourne also represented the lenders, received the 2012 North American Oil and Gas Deal of the Year Award as well as the Overall North American Deal of the Year Award from Project Finance Magazine and Americas Deal of the Year from Project Finance International. According to industry observers, that financing proved groundbreaking, as it was:

• The largest US project financing to be executed on the basis of a fixed-price turnkey contract only
• The only LNG liquefaction financing in the world without ECA or multilateral support or without a completion guarantee
• One of the largest investments in the LNG sector by a private equity firm

This second phase of the financing has again broken new ground as:

• The first North American energy infrastructure transaction for KSURE, and one of the first such transactions for KEXIM
• The first Korean ECA energy infrastructure transaction utilizing a mini-perm structure
• The first Korean ECA energy infrastructure financing without a sponsor completion guarantee or other completion support
• The first North American transaction for many of the Korean commercial banks in the covered tranches.

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LNG World News Staff, June 03, 2013; Image: Cheniere