Tellurian to sell Driftwood LNG land for $1 billion, then lease

(Courtesy Tellurian Inc.) An artist's rendering of the Driftwood LNG facility near Lake Charles.

Tellurian, the company behind the Driftwood LNG project in Louisiana, has signed a letter of intent to sell 800 acres of the land to be used for the facility to an undisclosed institutional investor for $1 billion, reports the Journal for Petroleum Technology.

The company revealed in a regulatory filing last week that, if the deal is completed, it would then lease back the land under a 40-year term at a capitalization rate of 8.75 percent and a letter of credit equal to 12 months of rent, among other requirements.

The Driftwood LNG terminal is planned for a 1,200-acre site on the west bank of the Calcasieu River, south of Lake Charles. Tellurian and US-based Bechtel signed four fixed-price, lump-sum, turnkey agreements totaling $15.2 billion for engineering, procurement, and construction services related to Driftwood back in November 2017. The project received regulatory approvals in January to begin construction and is expected to produce 27.6 MTPA of LNG at full capacity. Read the entire story.