Cheniere Partners signs off on Sabine Pass investment

July 30 Mon Jul 30, 2012 7:23pm EDT

July 30 (Reuters) - Cheniere Energy Partners LP approved investment plans for the start of a $5 billion U.S. liquefied natural gas export project, which it says could come online in 2015.

Cheniere announced on Monday the board's final investment decision for the first two liquefaction processing units, called 'trains', in Sabine Pass, Louisiana, which will turn the gas into liquid. The deal is subject only to the closing of the funding.

Cheniere said on Monday it expects to fund the project with about $2 billion of equity and $3.6 billion of debt. Units of Blackstone Group are buying $1.5 billion of Cheniere Partners' Class B units, while Cheniere Energy Inc will buy the rest.

A $3.6 billion bank credit facility will be held by a syndicate of 11 joint lead arranger banks and additional banks and financial institutions.

Houston-based Cheniere Partners said it would issue a full notice to proceed to Bechel, an engineering company, which will build the two trains once the equity funding is in place.

The first train is expected to start operating as early as 2015, with the second due to start six to nine months later.

Cheniere received regulatory approval in April to build the Louisiana facility. It will be the first project of its kind in the United States in nearly 50 years and comes as domestic gas production hits record highs thanks to prolific output from shale deposits across the country.

The company has firm supply deals with South Korea's state-owned gas buyer KOGAS, Britain's BG Group , India's GAIL and Spain's Gas Natural Fenosa .