Global Infrastructure Partners Sells Stake in Freeport LNG

JERA Americas will receive just over a quarter stake in the LNG exporter for $2.5 billion.

Freeport LNG's Quintana Island liquefaction plant is the seventh largest LNG facility in the world.
SOURCE: Freeport LNG

Global Infrastructure Partners (GIP) has agreed to sell its 25.7% interest in Freeport LNG Development to JERA Americas for $2.5 billion. GIP’s second flagship fund, Global Infrastructure Partners II, acquired the stake in 2015 for $850 million. The group said in July of this year that it was putting its holdings in Freeport LNG up for sale.

JERA Americas is the US-based subsidiary of global energy leader JERA, the world’s largest buyer of LNG. Through its subsidiaries, it owns 25% of Freeport LNG Train 1 and purchases and transports 2.32 mtpa of LNG for use in Japan and other LNG-importing countries. Closing of the transaction is subject to customary regulatory approvals and conditions.

Freeport LNG owns and operates an LNG export facility on Quintana Island, near Freeport, Texas. In May 2020, Freeport completed construction on the third of its three liquefaction trains, which together produce 15+ mtpa and are underpinned by long-term contracts. Today, Freeport is the second-largest LNG facility in the US, and the only US facility to use electric motor-driven technology, emitting 90% less CO2 than a comparable gas-turbine-driven facility. Freeport is in the process of pursuing multiple accretive growth opportunities across the LNG value chain, including a fully permitted, shovel-ready Train 4 expansion.

“Since 2015, GIP has been an invaluable partner, contributing their expertise and relationships,” said Michael Smith, chairman and chief executive of Freeport LNG. “We look forward to building on our success with JERA, who is already a key partner and offtaker at Freeport and are excited to have them take a larger role in our growing LNG platform.”

JERA said its investment will allow it to build upon and accelerate efforts that Freeport has already initiated toward the goal of cleaner energy. It plans to leverage the knowledge and expertise accumulated through its global LNG value chain business and power plant operations to meet the growing demand for electricity in Asian countries and help facilitate the transition from coal to lower-emission transitional fuel LNG.