Photo: Midship pipeline

Cheniere, EIG sanction Midship gas pipeline construction

Midship pipeline/Image courtesy of Cheniere

Houston-based LNG player Cheniere has awarded the final notice to proceed with the construction of a natural gas pipeline and related compression and interconnect facilities on the Midship Project.

The notice was issued by Cheniere’s unit Midship Pipeline Company to Strike, M.G. Dyess, TRC Pipeline Services, and Cenergy.

The Midship project received the Federal Energy Regulatory Commission clearance last month and is expected to be placed in service by the end of 2019, Cheniere noted in its statement.

Cheniere previously entered into arrangements with investment funds managed by EIG Global Energy Partners for an investment of up to $500 million in the Midship project.

Cheniere added that, in order to complete financing of the Midship project, Midship Pipeline entered into senior secured credit facilities with total commitments of up to approximately $680 million.

The credit facilities consist of an approximate $615 million construction loan facility and a $65 million revolving credit facility.

Proceeds from these credit facilities will be used to fund a portion of the costs of developing, constructing, and placing into service the Midship project, to fund working capital requirements, and for related general corporate purposes.

The project entails the development of a natural gas pipeline with a firm transportation capacity of up to 1,440,000 Dth/d connecting new gas production from the Anadarko Basin in Oklahoma to Gulf Coast and Southeast markets via deliveries to existing pipelines.

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