Veresen Provides Update on Commercial Activity for its Jordan Cove LNG Project

abarrelfullabarrelfull wrote on 10 Oct 2013 21:13
Tags: lng usa veresenn-america

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Veresen Inc. ("Veresen" or the "Company") (TSX: VSN) provided today an update of commercial activity related to the Company's proposed Jordan Cove liquefied natural gas (LNG) export facility located in Coos Bay, Oregon, and for the Pacific Connector Gas Pipeline (Pacific Connector), which will transport natural gas supplies to the Jordan Cove LNG terminal.

In what is expected to be a series of commercial transactions resulting from discussions with several prospective customers, Veresen is pleased to advise that its project level subsidiaries have executed initial customer expressions of interest by entering into non-binding arrangements, referred to as "Heads of Agreement" (HOA). The HOA sets out indicative commercial terms of the subsequent, binding, Liquefaction Tolling Services Agreement (LTSA) and Pipeline Service Agreement (PSA), which will be the subject of further negotiations between the parties.

Independent HOAs were recently finalized with three, large-scale prospective customers with head office locations in Indonesia, India, and an Eastern Asia country. The volume of LNG capacity requested under each HOA either meets or exceeds a minimum 25% capacity threshold amount, under the initial six million metric tons per annum LNG development offering by Jordan Cove and Pacific Connector. The contract term under each agreement is proposed to be 25 years, with extension rights.

"Signing these initial HOAs with prospective customers for liquefaction tolling services is an important commercial milestone in the development of our Jordan Cove LNG project," said Don Althoff, President and CEO of Veresen. "We've gained excellent traction in our commercial discussions and we continue to evaluate opportunities with several highly-respected prospective customers."

Veresen expects to execute a number of HOAs with prospective customers, which will then lead to advanced customer negotiations under long-term LTSA and PSA agreements.

Jordan Cove Energy Project L.P. is a subsidiary of Veresen Inc., and Pacific Connector Gas Pipeline, L.P. is a limited partnership owned equally by a subsidiary of Veresen and a subsidiary of Williams (WMB). The project level subsidiaries have current applications before the Department of Energy and the Federal Energy Regulatory Commission in the United States.

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