Cheniere Energy, Inc. · NYSE:LNG
Cheniere Energy — Investor Presentation (April 2008)
21 slides from Cheniere Energy's investor presentation, Apr 7, 2008
Slide 1: Corporate Presentation April 2008
Corporate Presentation April 2008 CHENIERE ENERGY
Slide 2: Forward-looking statements
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 of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934 as amended. All statements, other than statements of histor
Slide 3: Summary Components of Value
Summary Components of Value 90.6% Interest in Cheniere Energy Partners (CQP) GP Interest, ~3.3 mm shares ($5.6MM), $18MM annual management fees Common Interest, ~10.9MM shares ($18.7MM annual distribution) Subordinated Interest, ~135.4MM shares Creole Trail Pipeline Estimated construction cost of $5
Slide 4: Cheniere Energy Partners, L.P. (AMEX: CQP)
Cheniere Energy Partners, L.P. (AMEX: CQP) Sabine Pass LNG, L.P. Cheniere Energy, Inc. 90.6% Sabine Pass Construction Site – April 2008 4 Bcf/d capacity contracted at Sabine Pass facility resulting in annual revenues of approximately: $250 MM from CVX and Total $250 MM from Cheniere Marketing Operat
Slide 5: Sabine Pass LNG, L.P. Market Comps for Asset Value
Sabine Pass LNG, L.P. Market Comps for Asset Value *Valuations are based on recent market transactions and/or announcements per applicable company Capacity Valuation* Billon per Bcf/d Freeport 1.5 Bcf/d $1.8 Billion $1.2 Golden Pass 2.0 Bcf/d $2.6 Billion $1.3 Pascagoula 1.3 Bcf/d $1.4 Billion $1.1
Slide 6: Creole Trail Pipeline
Creole Trail Pipeline Cheniere Energy, Inc. 100% Cost: ~$550 million Free Cash Flow at Full Capacity: ~$66 million Length: ~150 miles total; 94 miles currently under construction; 2.0 Bcf/d Diameter: 42-inches Expected In-Service Date: 2Q 2008; coincident with Sabine Pass LNG
Slide 7: Freeport LNG Development, L.P.
Freeport LNG Development, L.P. Cheniere Energy, Inc. 30% Osaka Gas 10% Equity Valuation: $68 MM Implied 100% Equity Value: $0.7 B Debt: $1.1 B Total Value: $1.8 B Capacity: 1.55 Bcf/d Estimated Annual Distribution on Cheniere’s 30% LP Interest: $15 MM* Freeport LNG Construction Site August 2007 *Cas
Slide 8: Cheniere Development Projects
Cheniere Development Projects Corpus Christi LNG, LLC ~212 acres in San Patricio County, TX ~2.6 Bcf/d permitted vaporization ~10.1 Bcfe permitted storage Creole Trail LNG, L.P. ~1,750 acres in Cameron Parish, LA ~3.3 Bcf/d permitted vaporization ~13.5 Bcfe permitted storage Southern Trail Pipeline
Slide 9: Estimated Future Cash Flows
Estimated Future Cash Flows Body: Freeport $ 15 CMI TUA with CQP <251> Distribution from CQP 249 GP Distribution and Cost Reimbursement 24 Debt Service <49> $ <12> Questions Are: Interruptible Revenues on Creole Trail Pipeline CMI Marketing Performance Corporate G & A Annualized as of Q3 2009 $ in M
Slide 10: Potential Marketing Earnings-Simplified View
Potential Marketing Earnings-Simplified View 30 Cargoes @ $1.00 Gross Margin: $90 million 70 Cargoes @ $1.00 Gross Margin: $210 million CMI Capacity – 240 Cargoes ??
Slide 11: Condensed Balance Sheet
Condensed Balance Sheet Cheniere Energy Other Cheniere Consolidated Partners, L.P. Energy, Inc. (1) Cheniere Energy, Inc. (3) Unrestricted cash (2) - $ - 297 $ 297 $ Restricted cash and securities 709 61 770 Property, plant and equipment 1,127 518 1,645 Goodwill and other assets 69 181 250 Total ass
Slide 12: Global Liquefaction Capacity
Global Liquefaction Capacity Bcf/d Advancing Firm Plants under construction will increase global capacity by 45% Source: Cheniere research
Slide 13: New Liquefaction Competes for Market Share
New Liquefaction Competes for Market Share Atlantic Basin 12 Bcf/d ME Gulf 11 Bcf/d Asia Pacific 13 Bcf/d 2007 Europe 5.4 Bcf/d 2007 12.3 Bcf/d 2007 NA 1.8 Bcf/d (Gp:) 2010 Liquefaction Capacity (Gp:) 2007 Consumption 5 15 25 35 45 2005 2006 2007 2008 2009 2010 36 23 24 26 30 35 Bcf/d Liquefaction C
Slide 14: 2007 in Perspective
2007 in Perspective Very mild winter New Norwegian supply Good Hydro generation in Spain Growth in Wind generation in Spain Mild winter Nuclear Problems Economic growth in China & India Asia Pacific LNG Imports (Bcf/d) 0 2 4 6 8 10 12 14 16 2004 2005 2006 2007 Taiwan Korea Japan India China
Slide 15: Liquefaction – 2008 to 2010 Additions
Liquefaction – 2008 to 2010 Additions 5.1 3.9 Incremental Supply Currently Under Construction = 11 Bcf/d Existing end of 2007 Additions Bcf/d Source: Cheniere research
Slide 16: 2007 - Spot LNG Trade
2007 - Spot LNG Trade Percent Total LNG Trade Spot (Bcf/d) Spot trade rising overall and as a percent of total trade Liquidity is improving Suppliers retain flexibility Market needs optimization Source: GIIGNL, Preliminary 2007
Slide 17: Flexible LNG to the Atlantic Basin
1.5 1.5 1.5 1.5 1.8 1.8 1.8 1.6 0.5 0.5 0.5 0.5 2.0 2.0 2.0 2.0 0.4 0.4 0.4 0.4 1.3 2.3 4.9 0.2 0.2 0.2 0.3 9.2 11.7 7.9 6.6 - 2 4 6 8 10 12 2007 2008 2009 2010 Bcf/d Nigeria Yemen Qatar Oman Abu Dhabi Trinidad Norway Eq. Guinea Egypt Algeria Flexible LNG to the Atlantic Basin Flexible LNG to the At
Slide 18: Treadmill Effect: Lower Production
Treadmill Effect: Lower 48 Production grew 1.6 Bcf/d in 2007 after 5-year drilling up-cycle 1 Bcf/d Independence Hub starts
Slide 19: US Demand
US Demand US Market grew ~4 Bcf/d in 2007 R/C +6.5% Industrial +2.1% Power+9.9% 63.2 59.3 61.3 60.3 61.0 60.9 63.0 63.9 2007 Demand +6.5% Source: EIA
Slide 20: New Power Plants in US
New Power Plants in US 75 GW of gas-fired capacity planned through 2015 Source: Velocity Suite
Slide 21: Conclusion
Conclusion Limitation on world-wide markets ability to absorb additional volumes, especially on a seasonal basis will validate value of spare capacity. Supply/Demand picture in the U.S. will exacerbate the issue and will lead U.S. to respond with price signals to meet power generation demand.