FINANCING LNG PROJECTS IN A CHANGING ECONOMIC ENVIRONMENT

Since 1970, the economies of the world have experienced slow growth, rising inflation, foreign exchange volatility, and capital market constraints, such as short maturities, volatile floating interest rates, and periods of capital scarcity. Despite the unfavorable economic environment, baseload LNG operations have grown rapidly during this same period. The technical viability of LNG production and shipping is well established. While at one time the major issues in the development of an LNG project were primarily technical, now they are more likely to involve issues of commercial viability. Recent trends indicate that the future economic environment may continue to be unfavorable to the development of capital intensive projects. Structuring an LNG project will require greater planning and attention to the financing and economic environment. This will entail evaluation of proven ways and emerging possibilities for dealing with economic uncertainty. However, with an awareness of this environment and its implications for financing, projects can be structured to meet energy needs of the 1980's. The technical development and commercial advantages of LNG point to continued growth.

Media Info

  • Pagination: p. 1-12

Subject/Index Terms

Filing Info

  • Accession Number: 00322625
  • Record Type: Publication
  • Report/Paper Numbers: Paper 9, Session 4 Conf Paper
  • Files: TRIS
  • Created Date: Nov 29 1980 12:00AM