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A.2.5.1.2 The SPV
A SPV was formed, namely the East Cameron Gac Company (ECGP), incorporated in the
Cayman Islands.
A.2.5.1.3 Type of contract
A Musharakah (co-ownership/joint venture) type of contract was used as the underlying
contract in which sukuk investors had the ownership “Overriding Royalty Interest (ORRI)” in
two gas properties located in the shallow waters offshore the State of Louisiana through an
SPV acting as a trustee of the sukuk holders. Like the sukuk investors, the originator also
contributed its funds into the musharakah. The assets of the musharakah were co-owned by
the sukuk holders and the originator company, ECP.
Figure A.2: East Cameron Gas Co. Sukuk Issuance
A.2.5.1.4 ECP’s Sukuk Structure
 The issuer, East Cameron Gas Company (ECGP), incorporated in Cayman Islands, issued
sukuk worth USD165.7 million. The proceeds from sukuk issuance were used to buy the
ORRI from the Purchaser SPV, mentioned in a Funding Agreement for USD$ 113.8 million.
 The remaining amount, USD 51.9 million was set aside for future development, a reserve
account and the purchase of put options for natural gas to hedge against the risk of fall in
gas prices.
ECP
Purchase SPV Issuer SPV Sukuk Holders
3 2 1
4 5 6
U.S.A. Cayman Islands
1 – Sukuk Subscription of $165.67 million
2 – Funding $ 165.67 million
3 – Purchase of ORRI $113.84 million
Source: East Cameron gas Co. FIR 2006 and Wijnbergen and Zaheer (2013)