Contractor behind QatarEnergy-ExxonMobil LNG plant files for bankruptcy

Zachry Holdings, which is developing the Golden Pass LNG in Texas, has filed for bankruptcy, noting several challenges and disruptions that have impacted the announcement.

In 2019, Zachry Holdings, along with venture partners, were awarded an engineering, procurement, and construction contract by Golden Pass Products LLC, a joint venture partnership of QatarEnergy and ExxonMobil affiliates.

The contract included the construction and commissioning of the LNG liquefaction and export facilities, with a production capacity of around 16 million tonnes of LNG per year from three process trains.

Golden Pass LNG is located adjacent to the site of the existing Golden Pass LNG import terminal in Sabine Pass, Texas.

Chapter 11 bankruptcy is a legal process that allows businesses to reorganise debts while continuing to operate. It’s often referred to as a “reorganisation” bankruptcy. The main goal of Chapter 11 bankruptcy is to restructure the company’s debts and business operations to become profitable again.

John Zachry, Chairman and CEO of Zachry Holdings, said that since beginning work on the Golden Pass LNG project in 2019, Zachry Holdings has gone “above and beyond” to accommodate the schedule and demands of the project.

He continued, “As the project’s lead contractor, we have navigated significant challenges and disruptions stemming first from the Covid-19 pandemic and, more recently, international geopolitical issues.”

“These unforeseen disruptions have resulted in a significant financial strain while meeting targets and keeping the project appropriately staffed.”

Zachry Holdings will initiate a structured exit from the Golden Pass LNG project.

The North American engineering and construction company said the filing will help it strengthen its overall financial position as it continues to serve its customers across several sectors.