Trafigura enters $400 million loan to buy US LNG cargoes for Europe

Energy trader Trafigura has entered into two revolving credit facilities worth $400 million and will use the funds to purchase LNG cargoes from US exporters for supply to customers in Europe.

Trafigura said in a statement on Wednesday that the facilities are supported by the Export-Import Bank of the United States.

The signing of the deals follows approval by the US EXIM board of directors of two financial institution buyer credit (FIBC) policies issued to two financial institutions, including Citibank, for short-term facilities being extended to Trafigura, it said.

Trafigura said it will use the facilities to purchase LNG cargoes from US exporters for supply to customers primarily in Europe, providing “energy security through replacement of Russian gas due to the war in Ukraine.”

“We’re delighted to have successfully closed the first LNG-based facilities backed by US EXIM’s FIBC insurance policy, which supports American jobs by facilitating US exports,” Christophe Salmon, Trafigura’s CFO said in the statement.

In December last year, Trafigura entered into a $3 billion four-year loan to supply US LNG to German gas trader Sefe, previously known as Gazprom Germania.

The commodity firm said at the time that first gas delivery took place on November 1, 2022 and Trafigura would primarily use existing quantities from its global gas and LNG portfolio to help secure gas supplies to Sefe.

LNG volumes

Trafigura has a long-term LNG supply deal with US LNG exporting giant Cheniere.

The 15-year deal started back in 2019 and Trafigura buys about 1 million tonnes a year of LNG from Cheniere.

Trafigura’s LNG volumes dropped about 7.1 percent in the fiscal year ending September 30 while the company’s net profit more than doubled to $7 billion.

LNG volumes declined to 13 million tonnes compared to 14 million tonnes during the same period last year, Trafigura said in its annual report.

Trafigura did not reveal its LNG volumes for the six-month period ended March 31, 2023.

The company’s profit more than doubled during the period to $5.5 billion.

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