Hunton & Williams Represents Lenders on Approx. $4.37B Freeport LNG Export Facility Financing

NEW YORK — December 1, 2014 — Hunton & Williams LLP successfully represented Japan Bank for International Cooperation (JBIC), Nippon Export and Investment Insurance (NEXI), and a group of commercial banks on a $4.369 billion senior secured project debt finance, letter of credit and working capital facilities to finance the construction and operation of Train 1 of a multi-train natural gas liquefaction and export facilities project to be located on Quintana Island near Freeport, Texas.

The Train 1 project will be constructed, operated and owned by Freeport LNG Expansion, L.P. (Freeport LNG), Osaka Gas Co., Ltd. and Chubu Electric Power Co., Inc. Osaka Gas and Chubu Electric, two of Japan’s largest utilities, will offtake and export the full capacity of the Train 1 LNG (liquefied natural gas) production under long term contracts. The Train 1 facilities are part of a planned three‐train LNG production and export facility being developed by Freeport LNG. The Train 1 debt and equity financing transactions closed and funded on November 25, 2014, concurrently with the Freeport LNG Train 2 debt and equity financing transactions. The transactions reportedly represent the largest fully non-recourse project construction financings to have ever occurred.

JBIC is contributing 70% of the Train 1 project debt financing, with the remaining 30% of project debt financing being provided under NEXI insurance cover by Mizuho Bank, Ltd., Sumitomo Mitsui Banking Corporation, The Bank of Tokyo-Mitsubishi UFJ, Ltd., Sumitomo Mitsui Trust Bank, Limited, Mitsubishi UFJ Trust and Banking Corporation, and ING Bank N.V.

The proposed three-train LNG production and export terminal facilities, which are an expansion of Freeport LNG’s existing LNG import terminal and regasification facility, are designed to provide an LNG export capacity of approximately 13.2 mmtpa (million metric tonnes per annum).

The LNG production and export project is expected to add long-term support to the US shale and other natural gas-producing regions, including Texas and the Gulf Coast, and significant benefits for the state’s economic and employment growth.

The Hunton & Williams team was led by Raj Pande and included energy and infrastructure lawyers Ellis M. Butler, Laurence E. Skinner, Kevin C. Felz, Miki Kondo, Timothy R. Coughlin, W. Benjamin Falk, Henry H. Jin, Grétel Martinez, law clerk John Papaspanos and Adam O’Brian; regulatory and environmental lawyers Mark W. Menezes, Kevin J. Finto, Karma B. Brown, Eric M. Hutchins and Shawn J. O’Brien; real estate lawyers Howard E. Schreiber and Michael E. Sievers; bankruptcy lawyer Gregory G. Hesse; capital finance and banking lawyers Thomas A. Rice and Luppe B. Luppen; litigation lawyers John Jay Range and Carter T.Coker; and tax lawyers B. Cary Tolley III and Hilary B. Lefko; with assistance from real estate specialist Sophie Maleski and senior paralegals Julie Mendoza and Paula Arfin.