Magnolia LNG is in the process of agreeing with KSJV (a KBR – SKE&C joint venture led by KBR) to extend the validity period of the current binding engineering, procurement, and construction (EPC) contract.
The companies were targeting completion of this extension by December 31, 2016, but have agreed to an extension to the EPC contract through January 31, 2017, as a bridging step to an agreement on a longer-term extension.
As previously announced in November, Magnolia and KSJV signed an LSTK EPC contract with a cost of US$4.354 billion for four LNG trains (a total of 8 mtpa or greater) and associated facilities. The original agreement maintained the validity of the LSTK EPC contract price through 30 April 2016.
LNGL Managing Director and Chief Executive Officer, Greg Vesey stated, “We are pleased to continue to be working closely with KBR-SK E&C as well as other key contractors and suppliers to maintain momentum on the Magnolia LNG project as we finalize LNG offtake agreement efforts. Extension of the lump sum turnkey contract price validity along with the recent receipt of the US Department of Energy (DOE) non-FTA export approval helps maintain Magnolia’s standing as the low cost, low risk, construction ready Gulf Coast LNG export project.”
ABOUT MAGNOLIA LNG PROJECT
Magnolia LNG proposes to construct and operate up to four liquefaction production trains, each with a capacity of 2 mtpa or greater using LNG process technology. Construction and operation include two 160,000m3 full containment storage tanks, ship, barge, and truck loading facilities, and supporting infrastructure. The LSTK EPC contract includes all elements of the project necessary to bring the facility into full guaranteed production operations. Magnolia LNG is fully permitted, having received its FERC Order and both FTA and non-FTA approval from the DOE. Final investment decision and initiation of construction are expected upon execution of sufficient offtake agreements to support financing.