US LNG-producing giant Cheniere Energy Partners has inked a new long-term LNG sales deal that could see it delivering LNG to its customer beyond 2050.
Speaking on the company’s third-quarter results call, Cheniere vice president and chief commercial officer Anatol Feygin said that in 2023 Cheniere has signed almost six million tonnes per annum of long-term contracts with Asian and European customers.
The company announced a new 20-year, 0.9 mtpa free-on-board contract with Foran Energy Co on Thursday with deliveries to kick off from the start of commercial operations of the second train of Sabine Pass Liquefaction (SPL) expansion project, on which Cheniere has yet to take a final investment decision.
Feygin said: “This contract could very well extend into the second half of this century.”
He said this evidences the long-term role of gas in the global energy mix and the need for more development of LNG.
Cheniere president and chief executive Jack Fusco highlighted that the Foran deal is the first contract signed in connection with the project’s second train of the SPL expansion.
Sabine Pass LNG consists of six LNG trains with a total production capacity of 30 mtpa and a further 20 mtpa planned under the three-train expansion phase.
Fusco said he is “confident” Cheniere has more sales to conclude this year.
Updating on the company’s Corpus Christi LNG Stage 3 project, Fusco said this is over 44% complete and months ahead of schedule.
Fusco said he is optimistic that the first train will be producing LNG by the end of 2024, with all seven trains due in operation by late 2026.
Super-speedy
Cheniere exported its 3,000th LNG cargo during the third quarter, with the tally now up at over 3,070 from its two projects Sabine Pass LNG and Corpus Christi LNG. The volumes were shipped on a free-on-board basis and discharged in France.
The company is claiming the title of “fastest LNG producer in history to reach this milestone”.
Feygin said the global LNG market remains “precariously balanced” and vulnerable to market shocks.
Cheniere said the US and Qatar are leading the next LNG supply boost with around 200m tonnes of new production under construction.
The company is forecasting a 3% per annum growth in LNG demand through to 2040 and said some 135m tonnes of new LNG production will need to be approved to meet the demand growth from 2027.
Cheniere turned around its third and nine-months figures reporting net income of $1.7bn and $8.5 for the respective periods, compared to net losses of $2.4bn and $2.5bn in 2022.
But revenue for the third quarter more than halved to $4.2bn from $8.9bn in the same three months of last year and was down at $15.6bn from $24.3bn for the nine-month period.
Sub-chartering cash
LNG exports were relatively stable. The company exported 152 cargoes in the third quarter, a slight fall from the 156 logged for the same three months of 2022, lower maintenance than in the second quarter, with 468 recorded for the nine-month period, compared to 472 a year earlier.
The company guided towards the high-end of Ebitda for the full year of $8.3bn to $8.8bn. Chief financial officer Zach Davis said this is largely on the back of portfolio optimisation and vessel sub-chartering activities.
Looking ahead to 2024, Davis said Cheniere is expecting to produce around 45 mtpa of LNG. He said it is the “most contracted year-to-date”, with just 2% of production capacity unsold, giving the company minimum exposure to the market.
