Former Golden Pass LNG Contractor Zachry Set to Emerge From Bankruptcy by March
(Reuters) — The Texas construction contractor that last year quit the Golden Pass liquefied natural gas plant project, a joint venture between QatarEnergy and Exxon Mobil, could exit Chapter 11 bankruptcy before April, the company said on Friday.
Zachry Holdings said the U.S. Bankruptcy Court for the Southern District of Texas on Friday approved its reorganization plan, paving the way for it complete the process no later than the end of March.
The court set a hearing for Feb. 26 to confirm the plan.
San Antonio-based Zachry quit the export terminal project in Sabine Pass, Texas and filed for bankruptcy in May, saying costs exceeded the budget of its fixed-price construction contract. It was unsuccessful in trying to renegotiate.
Several U.S. LNG projects are expected to move forward under the Trump administration, and once Zachry completes the bankruptcy reorganization, it could represent another option for developers seeking an experienced LNG contractor.
Chiyoda International Corp. replaced Zachry as the lead construction contractor at Golden Pass, and Zachry in July 2024 reached a settlement to resolve disputes related to the project.
Construction costs at Golden Pass were budgeted at $10 billion and Zachry's share was budgeted at $5.8 billion.
Zachry said the project was costing $30 million to $40 million weekly while Golden Pass paid it $70 million monthly.
"We are pleased to have filed the revised plan... and all parties have committed to working in good faith to finalize creditor treatment under the plan," Zachry said in a statement.
The exit caused further delays in the construction of the 18 million metric tonnes per annum LNG facility, which is now expected to produce first LNG in 2025, according to Exxon.
Zachry said it continues to operate at all of its active projects and jobs sites.
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