Stabilis announced the LNG deal with the unnamed firm in October last year, marking the company’s first marine bunkering contract for its proposed 350,000 gallon-per-day Galveston liquefaction facility.
The agreement included the supply of approximately 50 million gallons of LNG per year, roughly 40 percent of the facility’s planned liquefaction capacity, with minimum volume commitments of approximately 32 percent of planned capacity.
Moreover, the agreement was subject to, among other things, the successful financing, construction, and commissioning of the proposed facility
However, Stabilis GDS, a unit of Stabilis, terminated the agreement on March 31, Stabilis announced in a SEC filing.
Stabilis said the decision to terminate the agreement was made in connection with the company’s ongoing efforts to secure third-party project financing for the Galveston LNG facility.
“During negotiations with prospective financing partners, the company was requested to modify certain provisions of the agreement as a condition to completing project financing. The counterparty did not agree to the proposed modifications, and the Company elected to terminate the agreement,” Stabilis said.
Delays
As a result, the company expects delays to the anticipated final investment decision, project financing, and development timeline for the Galveston LNG facility.
Stabilis said it continues to pursue the development of the facility and is engaged in discussions with potential customers regarding alternative offtake arrangements.
In February, Stabilis said it still expects to make FID on its planned liquefaction facility in Galveston by the end of the first quarter of this year.
Stabilis expects the total capital required for the project to reach $350 million to $400 million.
Upon completion, the facility is anticipated to increase Stabilis’ liquefaction capacity from 130,000 gallons per day from its two existing liquefaction facilities to 480,000 gallons per day.
Stabilis currently owns a liquefier that can produce more than 100,000 LNG gallons per day in George West, Texas, and a liquefier that can produce up to 30,000 LNG gallons per day in Port Allen, Louisiana.
