Magnolia LNG, LLC (Magnolia), has signed a legally binding agreement with Meridian LNG Holdings Corp (Meridian LNG) for firm capacity rights for up to 2 million tonnes per annum (mtpa) at Magnolia LNG, located on the Calcasieu shipping channel in the Lake Charles District, State of Louisiana, USA. Under the liquefaction tolling agreement (LTA), Magnolia will provide liquefaction servicesto Meridian LNG over the term of the contract in return for monthly capacity payments. Meridian LNG is responsible for procurement and delivery of feed gas to the liquefaction plant and for arranging all LNG shipping required to transport the LNG from the liquefaction plant to its customers. Meridian LNG intends to deliver the LNG to Port Meridian, its Höegh LNG operated floating re‐gasification terminal in the UK with the gas delivered to E.ON Global Commodities (EGC) under the 20‐year gas sales agreement (GSA) executed and announced by Meridian LNG on 23 April 2015. Key terms of the LTA include:
- Initial term of 20 years, with option to extend by a further 5 years;
- Firm annual capacity of 1.7 mtpa with a further 0.3 mtpa to be offered at Magnolia’s discretion;
- Conditions precedent, including that Magnolia achieves financial close no later than 30 June 2016. “We have been working with Meridian LNG since late 2013 and are delighted to have completed our first binding liquefaction tolling agreement.