MemoryError when shrinkage=true for LinearDiscriminantAnalysis

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The rest of the scenarios the algorithm works well apart from setting the shrinkage parameter.
In order to improve the accuracy of the algorithm I am using various techniques.
In the scikit document it says using shrinkage can improve accuracy.

I am using AT&T data sets provided by scikit-learn (fetch_olivetti_faces).

Is it because the number of features are large or the memory issue?

Currently I am using VM machine to the run the code.
Hardware Specifications of the machine are:

CPU: Core i5
Memory: 1 GB Ram
Storage: 20 GB SSD
OS: UBUNTU 14.4


This is the code I am running:

lda = LinearDiscriminantAnalysis(solver='lsqr',shrinkage='auto')

This is the error I am getting:

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