Alabama to Sell $750 Million of Gas Supply Revenue Bonds

By Chris Wack

Southeast Energy Authority will sell $750 million of Gas Supply Revenue Bonds to prepay for the cost of purchasing a fixed quantity of natural gas to be delivered over 30 years.

The Series 2025 F bonds will also be used to fund capitalized interest and pay costs of issuance of the bonds, according to an official statement posted Thursday on MuniOS.

The authority and BP Energy have entered into a prepaid natural gas purchase and sale agreement, under which BP Energy is obligated to deliver specified daily quantities of gas, or make payments for any gas not delivered or taken.

The prepaid agreement provides for the delivery of about 289 million British Thermal Units of natural gas in specified daily quantities transported via pipelines to designated delivery points. The delivery period is scheduled to begin Oct. 1, 2025, and end Sept. 30, 2055.

The bonds are special and limited obligations of the authority, payable solely from, and secured by, the revenue received by the authority under gas supply contracts and other revenue and funds.

Interest on the 2025 Series F Bonds is payable starting on Nov. 1 and again on May 1.

The authority is a capital improvement cooperative district and public corporation in Alabama.

Moody's has issued an A1 rating on the bonds.

BofA Securities is leading the offering.

Write to Chris Wack at chris.wack@wsj.com