Cheniere Energy, Inc. · NYSE:LNG
Cheniere Energy — Investor Presentation (October 2006)
25 slides from Cheniere Energy's investor presentation, October 2006
Slide 1: Cheniere Energy, Inc. Corporate Presentation October 2006
CHENIERE ENERGY, INC. *Sabine Pass LNG L.P. *Corpus Christi LNG L.P. *Creole Trail LNG L.P. *Freeport LNG L.P. Cheniere 100% Cheniere 100% Cheniere 100% Cheniere 30% Limited Partner Corporate Presentation October 2006 *Artist’s Rendition
Slide 2: Safe Harbor Act
Safe Harbor Act This presentation contains certain statements that are, or may be deemed to be, “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act. All statements, other than sta
Slide 3: Freeport LNG, L.P.
Freeport LNG, L.P. Cheniere Energy, Inc. 30% L.P. interest Freeport LNG Construction Site Land – 233 acres in Brazoria County, TX Berthing/Unloading – 2 docks – 78,000 cm to 250,000 cm LNGCs – 3 dedicated tugs Storage – 2 x 160,000 cm (6.7 Bcfe) Vaporization – 1.5 Bcf/d Project Status – 55
Slide 4: Sabine Pass LNG, L.P.
Sabine Pass LNG, L.P. Cheniere Energy 100% Land Sabine Pass Construction Site – 853 acres in Cameron Parish, LA Accessibility - Deepwater Ship Channel – Sabine River Channel dredged to 40 feet Proximity – 3.7 nautical miles from coast – 22.8 nautical miles from outer buoy Berthing/Unloading
Slide 5: Corpus Christi LNG, L.P.
Corpus Christi LNG, L.P. Cheniere Energy 100% Corpus Christi Site Preparation Land – 212 acres in San Patricio County, TX – ~ 400 acres of permanent easement Accessibility - Deepwater Ship Channel – La Quinta Channel dredged to 45 feet Proximity – 14.3 nautical miles from coast – 16 nautical m
Slide 6: Creole Trail LNG, L.P.
Creole Trail LNG, L.P. Cheniere Energy 100% Creole Trail Terminal Land Artist’s Rendition – 1463 Acres in Cameron Parish, LA Accessibility - Deepwater Ship Channel – Calcasieu Channel dredged to 40+ feet Proximity – 3.2 nautical miles from Coast – 30.9 nautical miles from outer buoy Berthing
Slide 7: Cheniere Energy Forecast
Cheniere Energy Forecast Freeport LNG L.P. – 30 % Capacity Revenue to Cheniere Sold – Terminal Use Agreement (TUA) Conoco 1.0 Bcf/d $15 Dow 0.5 Bcf/d Revenue to Cheniere @ Cheniere Energy – 100% Capacity $0.32 MMBtu ($MM) Sold – Terminal Use Agreement Total, S.A. 1.0 Bcf/d $125 Chevron 1.0 Bcf/d $12
Slide 8: Potential Value of Spare Capacity
Potential Value of Spare Capacity
Slide 9: 2010 Global Liquefaction
2010 Global Liquefaction Worldwide LNG trade CAGR 2005 - 2010 (Bcf/d) 38 Bcf/d 40 Oil worldwide 2% 30 Gas worldwide 3% 20 LNG worldwide 13% 10 LNG in N. America 33% 0 2005 2006 2007 2008 2009 2010 Asia Pacific Europe North America 9 Source: Poten & Partners, EIA
Slide 10: Realignment of LNG Imports By Region
Realignment of LNG Imports By Region LNG Trade (Bcf/d) (Bcf/d) 30 Asia Pacific 25 Europe 13 25 North America 20 8.6 18 15 10 12 12 9.6 2 5 5 0 Atlantic Pacific Atlantic Pacific Atlantic Pacific Basin Basin Basin Basin Basin Basin 2005 2010 2015 10 Source: Poten & Partners 2006
Slide 11: Seasonal LNG Imports - 2010
Seasonal LNG Imports - 2010 Bcf/d 20 10.1 10.6 15 17.9 7.2 5.6 15.7 17.3 15.2 10 9.6 9.6 8.4 7.9 5 0 Atlantic Pacific Atlantic Pacific Atlantic Pacific Atlantic Pacific Basin Basin Basin Basin Basin Basin Basin Basin Q1 Q2 Q3 Q4 Europe Asia North America 11 Source: Cheniere Research
Slide 12: Total European Imports
Total European Imports Europe Total Imports Bcf/d 8.0 7.0 6.0 5.0 4.0 3.0 2.0 1.0 0.0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2006 Total 2005 Total 2004 Total Source: Commercial Services 2006 12
Slide 13: Spain Imports
Spain Imports Bcf/d Terminal Terminal 4.5 Capacity Capacity 4.0 3.5 3.0 2.5 2.0 1.5 1.0 0.5 0.0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2006 Total 2005 Total 2004 Total Source: Commercial Services 2006 13
Slide 14: France Imports
France Imports France Total Imports Terminal Terminal 1.8 Capacity Capacity 1.6 1.4 1.2 1.0 Bcf/d 0.8 0.6 0.4 0.2 0.0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2006 Total 2005 Total 2004 Total Source: Commercial Services 2006 14
Slide 15: UK Imports
UK Imports UK Isle of Grain Imports 0.8 0.7 Terminal Terminal 0.6 Capacity Capacity 0.5 B cf/d 0.4 0.3 0.2 0.1 0.0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2006 Total 2005 Total N/A 2004 Source: Commercial Services 2006 15
Slide 16: Henry Hub Premium (Discount) to NBP
16 Henry Hub Premium (Discount) to NBP $/Mmbtu $0.00 $1.00 $2.00 $3.00 $4.00 $5.00 $6.00 $7.00 ($6.00) ($5.00) ($4.00) ($3.00) ($2.00) ($1.00) Mar-98 May-98 Jul-98 Sep-98 Nov-98 Jan-99 Historical Data Mar-99 May-99 Jul-99 Sep-99 Futures as of 9/21/06 Nov-99 Jan-00 Mar-00 US Discount to UK May-00 US
Slide 17: North America Regasification Capacity By 2010
North America Regasification Capacity By 2010 Receiving Baseload Capacity Capacity Utilization: Utilization: ~~ 70% 70% Terminals Sendout (MMcf/d) Likely Likely Import Import Capacity: Capacity: ~~ 11 11 Bcf/d Bcf/d Canaport - Q4 2008 1,000 Canaport Canaport Irving, Repsol Everett - Suez 700 Cove Po
Slide 18: Total U.S. Imports
Total U.S. Imports 5.00 4.00 3.00 Bcf/d 2.00 1.00 0.00 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2006 2005 2004 2003 Source: Commercial Services 2006 18
Slide 19: Everett Imports
Everett Imports Terminal Terminal Capacity Capacity 0.70 0.60 0.50 0.40 Bcf/d 0.30 0.20 0.10 0.00 Jan Feb Mar A pr May Jun Jul Aug Sep Oct Nov Dec 2006 2005 2004 Source: Commercial Services 2006 19
Slide 20: Cove Point Imports
Cove Point Imports 1.00 Terminal Terminal Capacity Capacity 0.80 0.60 Bcf/d 0.40 0.20 0.00 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2006 2005 2004 Source: Commercial Services 2006 20
Slide 21: Elba Island Imports
Elba Island Imports Terminal Terminal 1.00 Capacity* Capacity* 0.80 0.60 Bcf/d 0.40 0.20 0.00 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2006 2005 2004 * Elba Island capacity increased from .4 Bcf/d to .8 Bcf/d in February 2006 Source: Commercial Services 2006 21
Slide 22: Lake Charles Imports
Lake Charles Imports Terminal Terminal Capacity* Capacity* 2.00 1.50 Bcf/d 1.00 0.50 0.00 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2006 2005 2004 * Lake Charles capacity increased from 1.2 Bcf/d to 1.8 Bcf/d in July 2006 Source: Commercial Services 2006 22
Slide 23: Niche Model vs. Merchant Model
Niche Model vs. Merchant Model Case Study: BG 2006 Niche: Elba Island – ~ 400 MMcf/d – Consistent volumes throughout year Merchant: Lake Charles – Contracted Capacity: ~ 1.0 Bcf/d – Delivered Capacity: ~ 400 MMcf/d – Diverted Cargoes to premium markets: • 62 (~ 500 MMcf/d) – 2006 projected shipp
Slide 24: Implication for Gulf Coast Excess Capacity
Implication for Gulf Coast Excess Capacity 1 Bcf/d Merchant activities are necessary to deal with seasonality Gulf Coast is “backstop” for merchant activities Can accommodate large quantities of baseload capacity Allows merchant to redirect cargoes to premium markets during peak seasons Exam
Slide 25: Cheniere Receiving Terminal Portfolio
Cheniere Receiving Terminal Portfolio Commercialization Alternatives Annual Revenue / Bcf/d Terminal Use Agreement (TUA) $125 MM – $0.32/MMBtu Indexed Purchase Agreement (IPA) $ 220 MM – 10% margin; $6.00 Henry Hub Potential for Merchant Seasonal Cargo Diversion $180 MM – $1.00 price improveme
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