Tellurian reports progress on Driftwood project

In 1Q17, the company claims that it:

• Issued 23% of its common stock to Total for US$207 million.
• Closed a reverse subsidiary merger with Magellan Petroleum Corp. to become a public company, which is listed on the Nasdaq.
• Received authorisation to export LNG to free trade agreement (FTA) countries.
• Submitted applications to the US Federal Energy Regulatory Commission (FERC) to build and operate the Driftwood project.
• Engaged Société Générale as a financial advisor.

The President and CEO of Tellurian, Meg Gentle, commented: “Tellurian continues to consistently execute its plans to build a global natural gas business and has laid the foundation to design, permit, and finance the next world-scale LNG infrastructure in southwest Louisiana. We recently began marketing LNG to potential customers and we have received positive feedback and interest in our Driftwood Project which we expect to produce first LNG in 2022."

In the statement, the company provided the following estimated timeline:

• LTSK EPC contract – mid-2017.
• LNG sales and purchase agreements (SPAs) – 1H18.
• FERC construction authorisation – mid-2018.
• Liquefaction project financial close – mid-2018.
• Commencement of construction – mid-2018.
• Commencement of operations – 2022.

The company also reported a net loss of US$141 million – or US$0.92 per share (basic and diluted) – for the three months ended 31 March 2017. This includes US$22 million of development expenses (which were mainly associated with the Driftwood Project development and related regulatory filings); US$45 million of general and administrative expenses (which includes approximately US$35$ million of share-based compensation for employees and directors and share-based payment charges related to commercial development and management consulting contractors; and US$78 million to impair goodwill that was recognised as a result of the merger with Magellan in February 2017.

Tellurian claims that total cash disbursements for 1Q17 were approximately US$42 million. This included one-time payments of US$12 million related to engineering, procurement and construction (EPC) activities, as well as US$5 million of merge-related expenses, and US$25 million of disbursements in the normal course of business.

As of 31 March 2017, Tellurian claims that it had US$187 million of cash and cash equivalents, including proceeds from Total’s investments.

Read the article online at: https://www.lngindustry.com/liquid-natural-gas/11052017/tellurian-reports-progress-on-driftwood-project/