The deal comes amid instability in the global energy market after the escalation of the conflict over Iran and disruptions in the Strait of Hormuz, the Financial Times said.
Mubadala Energy will provide equity financing for the Commonwealth LNG project, which is being realized on the Gulf Coast in Louisiana. The developer of the project is the American investment company Kimmeridge Energy Management through the Caturus structure.
The company said that the project has already received final investment approval. The total amount of financing raised will amount to about $9.75 bln. The terminal is planned to be completed by 2030, after which the facility will start commercial LNG deliveries.
In addition to Mubadala Energy, investors in the project include EOC Partners, BlackRock, Canadian Pension Plan Investment Board and a fund managed by Ares Management.
Reaction to the closure of the Strait of Hormuz
The Commonwealth LNG project has become one of the largest energy agreements in recent months and reflects the increased interest of Middle Eastern investors in U.S. natural gas infrastructure.
The LNG market remains under pressure following restrictions on shipping through the Strait of Hormuz, through which about a fifth of the world’s liquefied natural gas supply passes. The logistical disruptions have driven up energy prices and heightened energy security concerns among importing countries.
Against this background, the U.S. is accelerating the launch of new export capacities. After President Donald Trump’s administration lifted restrictions on the construction of new LNG terminals, the industry received an additional impetus for expansion.
Commonwealth LNG became the second major export project to receive a final investment decision after the restrictions were lifted.
According to analysts’ forecasts, global demand for LNG will increase by more than 35% by 2030 due to the growth of Asian economies and the gradual abandonment of coal-fired generation in a number of countries.
Once operational, the terminal will be able to produce about 9.5 million tons of LNG annually, which is about 7% of current U.S. liquefied natural gas production.
