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Tellurian, Magellan Petroleum finalize merger, boosting funds for Driftwood LNG

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Tellurian, Magellan Petroleum finalize merger, boosting funds for Driftwood LNG

The former Magellan Petroleum Corp. said it has closed on its merger with Cheniere Energy Inc. co-founder Charif Souki's Tellurian Investments Inc., finalizing a deal that will help Souki fund his new Driftwood LNG project, a proposed 26 million-tonne-per-annum LNG project in Louisiana.

At the close of the merger Feb. 10, Magellan changed its name to Tellurian Inc. As part of the merger, former Magellan CEO Antoine Lafargue will now serve as Tellurian's CFO, according to a Feb. 10 news release.

Magellan, which produced crude oil in the Rockies using CO2-enhanced recovery techniques, announced in August 2016 that it was merging with Tellurian Investments. Tellurian has said it plans to issue 122 million new shares to finance the Driftwood LNG project, which would include 20 modular liquefaction trains, each capable of producing 1.3 mtpa, and would be located on the west side of the Calcasieu River.

Tellurian President and CEO Meg Gentle said construction on the liquefaction and export terminal is set to begin in 2018. "We expect our next major milestone to be filing our formal permit application with the Federal Energy Regulatory Commission for Driftwood LNG," she said in the statement.

Driftwood LNG LLC received FERC permission in June 2016 to enter the commission's prefiling review process. The developer expects to submit a formal application in March 2017. (FERC docket PF16-6)

Souki started Tellurian Investments with Martin Houston, the former CEO of Parallax Enterprises LLC, after billionaire activist investor Carl Icahn ousted Souki from his role at Cheniere in December 2015. Tellurian's common stock will now trade on the NASDAQ under the ticker TELL.