The sale of the Magnolia LNG project in Lake Charles to a Lafayette company has fallen through.
LNG Limited last week terminated the proposed sale to Global Energy Megatrend Limited of its interest in subsidiary entities that own and operate the Magnolia LNG project in Lake Charles.
In early May, LNG Limited announced that it had entered into a binding sale transaction with GEM. However, in a news release on its website, LNG Limited said that this arrangement has been terminated “due to GEM’s failure to close the transaction within the required timeframe.”
Instead, LNG Limited has entered into a new transaction under which it has sold its interests to another party, Magnolia LNG Holdings, for a cash price of $2 million. This transaction was signed and closed on May 26.
In addition to the cash purchase price, LNG Limited will receive an unsecured, non-interest bearing promissory note issued by Magnolia. As part of the transaction, LNG Limited and Magnolia will work together on a potential recapitalization proposal.
The Magnolia LNG project is a proposed 8 million tons per year LNG export terminal in Lake Charles. A proposed takeover of LNG Limited by Singapore’s LNG 9 came to a halt in mid-April and PricewaterhouseCoopers Australia was appointed as voluntary administrators of the company at the start of May.