Facing a six-month deadline to make a positive final investment decision, Tellurian Executive Chairman Charif Souki tells S&P Global Platts the likelihood of Driftwood LNG getting there is “very high.”
Total can back out of its Driftwood commitments, including a $500 million investment, if Tellurian does not declare a positive final investment decision by June 2021.
S&P Global Platts reports Total, a France-based multinational company, agreed in December to invest in the Energia Costa Azul LNG export project and also has stakes or offtake obligations at Sempra’s Cameron LNG in Louisiana, Freeport LNG in Texas and Cheniere Energy’s Sabine Pass in Louisiana, making its unclear whether Total would want to extend the Driftwood agreement. Souki tells S&P Global Platts talks with the investor are planned for this year.
Tellurian is seeking equity partners to help fund construction, in exchange for the right to lift LNG from Driftwood, slated to produce up to 27.6 million million tons per year, for the life of the facility.
As with most second-wave North American liquefaction projects, Driftwood struggled in 2020 to secure supply deals. Developers have blamed travel restrictions amid the coronavirus pandemic for making deals harder to reach, as well as volatile commodity prices for making buyers uncertain about signing new long-term agreements.
