Venture Global CEO: Shift Towards Internal Financing for LNG Projects Expected

(Reuters) — More funding for future LNG plants will rely on internal financing instead of the project financing that has paid for most projects to date, Venture Global LNG's CEO said on Tuesday.

The U.S. has become the world's largest LNG exporter due to the shale gas revolution and construction of massive liquefaction plants, most funded by bank and project financing.

"Increasingly we will see less project financing and more financing from the balance sheet,” said Venture Global LNG CEO Michael Sabel. In part, the changeover reflects the growth of expansion, or brownfield, projects as opposed to newly built LNG plants.

Sabel told an S&P Global panel at CERAWeek that his company was spending an average of $700 million per month on plant construction.

This year, it plans to spend $3.5 billion on its proposed Calcasieu Pass 2 (CP2) LNG project, even though it has yet to receive regulatory approvals.

CP2 is the largest LNG project affected by a decision by President Joe Biden's administration not to temporarily pause LNG export permits for new environmental reviews.

"We would not be spending that money unless we did not feel the announced pause was not temporary," said Sabel.

The Arlington, Virginia, company last year completed $21 billion in project financing for its Plaquemines LNG plant in Louisiana, the largest in the industry's history.

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