Cheniere Energy (LNG) jumped more than 13% this week after it announced its first deal to liquefy and ship natural gas from a planned facility in Corpus Christi to Indonesia, with components that were more lucrative than the company's prior liquefied natural gas contracts.
The fixed rate for the contract of $3.50/Mbtu was higher than LNG's prior contracts to ship natural gas from the Sabine Pass export facility under construction in Louisiana that is scheduled to be the first to ship U.S. natural gas overseas.
A variable component of the deal was less lucrative, however, with LNG agreeing to charge Pertamina an 11.5% premium on any gas it liquefies and ships, down from the standard 15% it had so far secured in other contracts.
Cheniere Energy (LNG) signs a 20-year liquefied natural gas sale and purchase agreement with Indonesia's PT Pertamina, in which Pertamina will purchase ~800K/year metric tons of LNG upon commencement of operations from the LNG export facility being developed near Corpus Christi, Tex.
Pertamina is the first foundation customer for the Corpus Christi project, and the deal is the first long-term commitment made to procure liquefied natural gas from the international market for delivery into Indonesia.
Cheniere Energy (LNG +2.6%) says it received a contract price for construction of its planned export terminal in Corpus Christi, a step which will allow it to begin negotiating contracts with overseas buyers of natural gas because it can now incorporate the project’s costs.
Bechtel, which provided the undisclosed price, is building liquefaction facilities at LNG's first terminal at Sabine Pass, La., the first facility to receive U.S. approval to ship natural gas to countries with which the U.S. doesn’t have free trade agreements. (Q3 earnings)
Cheniere Energy's (LNG +2.9%) price target is raised to $47 from $39 at Deutsche Bank, which also maintains a Buy rating on the stock, based on higher EBITDA expected from the underlying Cheniere Energy Partners (CQP) MLP, the inclusion of Corpus Christi at a valuation of ~$470M ($2/share) and the inclusion of Trains 5 and 6 at ~$450M ($2/share).
At CQP, the firm says the inclusion of projected CMI EBITDA of $145M for Trains 1-4 continues to appear conservative based on its macro view of worldwide liquefied natural gas fundamentals and additional capacity at Sabine Pass and Corpus Christi will add to volume potential.
Deutsche Bank initiates coverage of Cheniere Energy (LNG +0.4%) with a Buy rating and $39 target price and related MLP Cheniere Energy Partners (CQP +0.1%) with a Hold and $30 target.
LNG has earned the status as first mover and bellwether for the industry by achieving approvals and contracts and beginning construction earlier than others, the firm says; long-term contracts underpin the ability to achieve financing, generate cash flows and provide returns to shareholders over time.
DB's macro fundamental analysis of the worldwide liquefied natural gas business in general and the U.S. liquefaction outlook in particular shows numerous favorable trends.
Cheniere Energy (LNG) will attempt to raise $690M through the IPO of a holding company, according to SEC filings.
Cheniere Energy Partners LP Holdings, which expects to trade on the NYSE under the symbol CQH, will exist only to hold a 55.9% stake in Cheniere Energy Partners (CQP), an MLP that owns regasification facilities at its Sabine Pass liquefied natural gas terminal in Louisiana.
The holding company will allow Cheniere to segregate lower-risk, stable assets from higher-risk, early-stage projects, the filing says.
U.S. approval each year of 1.5B-2B cf/day of liquefied natural gas export capacity would be palatable for consumers, but energy policy makers would quickly hit the brakes and stall further capacity expansions if prices rise too fast or too severely, Bernstein analysts believe.
Approving no more than 2B cf/day each year would mean 5B-8B cf/day of liquefaction capacity would be under construction at one time, allowing the government to monitor price impacts as exports layer in, the firm says.
Cheniere Energy (LNG), Sempra Energy (SRE) and Dominion Resources (D) are among companies seeking to build gas liquefaction plants so they can export the fuel to places such as Asia, where LNG costs are more than four times higher than U.S. gas prices.
Cheniere Energy Partners (CQP -0.8%) is initiated at Outperform with a $33 price target at RBC Capital, which believes CQP should benefit as a first mover in U.S. natural gas liquefaction. Long-term fixed-fee contracts with investment grade counterparties provide cash flow visibility, and strong distribution growth should ensue when liquefaction trains 1-4 are online, the firm says.
Given that distribution-capture season is coming, where MLPs typically enjoy the bulk of their returns, Credit Suisse expects an upside bounce; for the July capture season, MLPs have delivered an average of 3.66% in total return the last seven years. The firm's top-quality names: [[MMP]], KMI, TEP, [[(GEL]], [[(LNG]], [[(CQP]], MWE, SXL, TRGP, XTEX, XTXI.
Cheniere Energy Partners (CQP +12.2%) shoots higher, apparently thanks to a plug from Jim Cramer, who sees the MLP as the preferred way to play the Sabine Pass liquefied natural gas terminal, believing CQP should be less risky than growth-oriented parent Cheniere Energy (LNG +4.1%). Cramer also likes Cabot Oil & Gas (COG +2%), which he says may have the most prolific acreage in the Marcellus shale.
Cheniere Energy (LNG) has acquired a 50% stake in the Octopus liquefied natural gas project being developed in Chile, Platts reports. The terminal, estimated to cost $150M, would have capacity to pump 15M cu/m of natural gas to shore which would be injected into existing network of pipelines in Chile's Biobio region.
Cheniere Energy $LNG from a few years ago. It was $3.50. Today its a 20 Bagger.
Jun 30, 11:10 AM
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rickeespal+ FollowFollowing- Unfollow|Send Message30 Jun
: you sold at 13, LOL, get a grip
Jun 30, 3:32 PM
BerkCE+ FollowFollowing- Unfollow|Send Message30 Jun
Let's see if $LNGLF gaps like $LNG ASX and then fills it up. That would be a great opportunity to buy.
Jun 30, 9:08 AM
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LNG vs. ETF Alternatives
Cheniere Energy, Inc. is engaged in LNG-related businesses. It owns and operates the Sabine Pass LNG terminal in Louisiana through its ownership interest in and management agreements with Cheniere Energy Partners, L.P.