Cheniere Energy, Inc. · NYSE:LNG
Cheniere Energy — Investor Presentation (October 2013)
39 slides from Cheniere Energy's investor presentation, Oct 15, 2013
Slide 1: Cheniere Energy October 2013
Cheniere Energy October 2013
Slide 2: Forward Looking Statements
Forward Looking Statements 2 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, o
Slide 3: Summary Organizational Structure
2.0% Interest & Incentive Dist. Rights Cheniere Energy, Inc. (NYSE MKT: LNG) Sabine Pass LNG, L.P. (“SPLNG”) Sabine Pass Liquefaction, LLC (“SPL”) Cheniere Energy Partners, L.P. (NYSE MKT: CQP) Cheniere Creole Trail Pipeline, L.P. (“CTPL”) Corpus Christi Liquefaction, LLC Cheniere Marketing, LLC (“C
Slide 4: Projected Global LNG Demand Growth
Projected Global LNG Demand Growth Regional LNG Import Outlook (mtpa)* Source: Wood Mackenzie 20 15 21 2015 2020 2030 2015 2020 2030 6 14 30 2015 2020 2030 2015 2020 2030 Americas Asia Middle East/N. Africa *Base-case scenario 196 254 356 27 70 101 4 From 236 mtpa (~32 Bcf/d) in 2012 to 514 mtpa (~6
Slide 5: Regional Natural Gas & LNG Prices
0 2 4 6 8 10 12 14 16 18 20 Se p -0 9 Se p -1 0 Se p -1 1 Se p -1 2 Se p -1 3 $/MMBtu Regional Natural Gas & LNG Prices As of September 27, 2013 NBP IFERC HH Monthly Japan Avg LNG European Gas Contract Estimated Prices Henry Hub: $4.00 / MMBtu Brent Crude: $100 / Barrel ($/MMBtu) Americas Europe Asi
Slide 6: Brownfield LNG Export Project Utilizes Existing Assets
Brownfield LNG Export Project Utilizes Existing Assets Trains 1-4 Fully Contracted, Under Construction Significant infrastructure in place including storage, marine and pipeline interconnection facilities; pipeline quality natural gas to be sourced from U.S. pipeline network Liquefaction Trains 3 &
Slide 7: LNG Sale and Purchase Agreements (SPAs)
LNG Sale and Purchase Agreements (SPAs) (1) BG has agreed to purchase 182,500,000 MMBtu, 36,500,000 MMBtu, 34,000,000 MMBtu and 33,500,000 MMBtu of LNG volumes annually upon the commencement of operations of Trains 1, 2, 3 and 4, respectively. Total has agreed to purchase 91,250,000 MMBtu of LNG vol
Slide 8: Construction Completion Schedules Trains 1-4
2012 2013 2014 2015 2016 2017 2018 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65 66 67 68 69 70 71 72 Guaranteed Current Level 3 Schedule Guaranteed Current Lev
Slide 9: Aerial View of SPL Construction – September 2013
Aerial View of SPL Construction – September 2013 9 Train 1 Train 2 Compressor Area T1 Air Coolers Compressor Area T2 Propane Condenser Foundations Cold Box Area
Slide 10: Corpus Christi Liquefaction Project
Corpus Christi Liquefaction Project Proposed 3 Train Facility >1,000 acres owned and/or controlled 2 berths, 3 LNG storage tanks (~10.1 Bcfe of storage) ConocoPhillips’ Optimized Cascade® Process Key Project Attributes Marine environment conducive to large tankers • 45 ft ship channel 13.7 m
Slide 11: Competitive With Other Recent Liquefaction Projects
- 500 1,000 1,500 2,000 * * * * Range of liquefaction project costs: $200 - $2,000+ per ton 1 Bcf/d of capacity = $1.5B to $15.0B+ Corpus Christi liquefaction project estimated costs are ~$800/ton (1) Corpus Christi Liquefaction, LLC Competitive With Other Recent Liquefaction Projects (1) Befo
Slide 12: Regulatory Approvals LNG Export Projects
Regulatory Approvals LNG Export Projects Corpus Christi Trains 1-3: Filed FERC and DOE applications • Completed and filed FERC application in 8/2012 (NEPA pre-filing process initiated in 12/2011) − Corpus Christi is one of seven liquefaction projects with a FERC application on file • Filed for FTA
Slide 13: FERC Applications Filed for Liquefaction Projects
FERC Applications Filed for Liquefaction Projects Note: National Environmental Policy Act (NEPA) empowers FERC as the lead Federal agency to prepare an Environmental Impact Statement in cooperation with other state and federal agencies LNG Export Projects Pre-filing Date Application Date FERC Schedu
Slide 14: U.S. DOE Applications for LNG Exports
Source: Office of Oil and Gas Global Security and Supply, Office of Fossil Energy, U.S. Department of Energy; U.S. Federal Energy Regulatory Commission; Company releases U.S. DOE Applications for LNG Exports* ** Application filed = v, FERC scheduling notice issued = * As of September 30, 2013. Not
Slide 15: CMI SPA – Excess Volumes from Trains 1-4 at SPL
CMI SPA – Excess Volumes from Trains 1-4 at SPL CMI-SPL SPA provides CMI with up to 2 mtpa of LNG delivered FOB Sabine Pass starting with the initial production from Train 1 •Maximum Annual Contract Quantity of up to 104 TBtu/year from first four Trains SPA sharing mechanic incents profit maximi
Slide 16: Example Annual Cash Flow on CMI SPA
Example Annual Cash Flow on CMI SPA (1) Net margins based on profitability of cargoes, up to $3.00/MMBtu paid to SPL on 36 Bcf of LNG sold in a year (Tranche 1); 20% of net margins paid to SPL on the remaining 68 Bcf of LNG sold in the year (Tranche 2) LNG sold 104 Bcf/year Net profit (after LNG cos
Slide 17: Timeline & Milestones
Timeline & Milestones Initiate permitting process (FERC & DOE) Commercial agreements EPC contract Financing commitments Regulatory approvals Issue Notice to Proceed Commence operations (1) Milestone Corpus Christi (1) Each Train of the respective projects is expected to commence operat
Slide 18: Financial Estimates
Financial Estimates (includes SPL Trains 1-4 and Trains 1-6)
Slide 19: CQP: SPLNG (Regas) Estimated Cash Flows
CQP: SPLNG (Regas) Estimated Cash Flows Total Revenues Total Expenses Total Chevron SPL Other EBITDA (1) 127 133 290 10 560 (65) $ 495 $ SPLNG Distributable cash flow to CQP $ 365 ($ in millions) Interest Expense (2) (130) Annualized (1) EBITDA is a non-GAAP measure. EBITDA is computed as total reve
Slide 20: CQP: SPL Estimated Cash Flows Trains 1-4
CQP: SPL Estimated Cash Flows Trains 1-4 Total Revenues Trains 1-4 (BG, Gas Natural, KOGAS, GAIL) Total Centrica Train 6 Customer (1) CMI (2) Commodity payments, net (3) O&M, gas procurement, & other Maintenance capex SPLNG/Total TUA Pipeline Costs EBITDA (4) 2,285 - - - 145 245 2,675 (175) (85) (32
Slide 21: CQP Forecasted Distributable Cash Flows Trains 1-4
CQP Forecasted Distributable Cash Flows Trains 1-4 Estimated distributable cash flow to (1) General partner Cheniere common units Public and BX units Estimated range of DCF per unit 370 730 715 $3.00 - $3.20 $ Estimated total distributable cash flow $ 1,815 ($ in millions) SPLNG distributable cash f
Slide 22: CQP Outlook Visible Future Growth
CQP Outlook Visible Future Growth Contracted LNG Export Volumes (SPL) Tbtu/yr CQP Contracted Revenues $MM Forecasted CQP Distributable Cash Flow $ per common unit Note: Estimates represent a summary of internal forecasts, are based on current assumptions and are subject to change. Actual performance
Slide 23: Cheniere Estimated Steady State Cash Flows
Cheniere Estimated Steady State Cash Flows ($ in millions) Net Cash Flows Cheniere Energy, Inc. Distributions from CQP (1) Management fees CEI expenses and other 1,100 50 (85) 1,065 $ $ Potential CF generated from CMI SPA (2) $0 - $1,000 (1) Based on distributions from CQP that Includes net profits
Slide 24: Summary Organizational Structure
Summary Organizational Structure Cheniere Energy, Inc. (NYSE MKT: LNG) Cheniere Energy Partners, L.P. (NYSE MKT: CQP) Sabine Pass LNG, L.P. (SPLNG) 58% Cheniere Energy, Inc. (1) 29% Blackstone (1) 13% Public (1) BG SPA (286.5 million MMBtu / yr) Gas Natural SPA (182.5 million MMBtu / yr) KOGAS
Slide 25: Appendix
CHENIERE = Appendix
Slide 26: Operating Assets
Operating Assets Sabine Pass LNG Terminal Creole Trail Pipeline 26
Slide 27: Contracted Capacity at SPLNG
Contracted Capacity at SPLNG Third Party Terminal Use Agreements (TUAs) Long-term, 20 year “take-or-pay” style commercial contracts ~$253MM annual fixed fee revenue Total Gas & Power N.A. Chevron U.S.A. Inc. Capacity 1.0 Bcf/d 1.0 Bcf/d Fees (1) Reservation Fee (2) $0.28/MMBTU $0.28/MMBTU Opex Fee (
Slide 28: Bechtel: Leading LNG Construction Contractor
Bechtel was the EPC contractor for the regasification project at the Pass LNG terminal, which was constructed on time and on budget Proven construction contractor with significant resources ▪ Founded in 1898 and headquarted in San Francisco ▪ 53,000+ employees Industry leading experience and results
Slide 29: Creole Trail Pipeline
Current Facility Receipt capacity from SPLNG: 2.0 Bcf/d Diameter: 42-inch; Length: 94 miles Delivery Points: NGPL, Transco, TGPL, FGT, Bridgeline, Tetco, Trunkline No compression Pipeline Modifications Delivery capacity to SPLNG: 1.5 Bcf/d Receipt points: TETCO, Trunkline, Transco One ne
Slide 30: 2012 Global LNG Supply & Demand
2012 Global LNG Supply & Demand 2012 Global LNG Capacity: ~37.3 Bcf/d Natural Gas Oil Products LNG Importers - Price Indexation Japan Crude Cocktail 2012 Global LNG Demand: ~31.5 Bcf/d No r th Ame r ica S outh Ame r ica E u r ope A sia 6.5 1.4 1.1 22 A ust r alia - 3.3 B r unei - 1.0 Indonesia - 4.6
Slide 31: U.S. Natural Gas Markets
US Proved Non-Producing Reserves Productive Capacity from Unconventional Reservoirs Tcf Bcf/d MMB/d Current market fundamentals in the U.S. – increased production, increased natural gas reserves and lackluster increase in natural gas demand – have created an opportunity to expand into exports – be
Slide 32: Primary Gas Sources for Sabine Pass Liquefaction
Montana Thrust Belt Cody Gammon Hilliard Baxter- Mancos Greater Green River Basin Forest City Basin Pierre Illinois Basin Piceance Basin Lewis San Juan Basin Raton Basin Anadarko Basin PaloDuro Basin Permian Basin Barnett Woodford Pearsall Eagle Ford Rio Grande Embayment Barnett Woodford Michigan Ba
Slide 33: Multiple Local Pipeline Interconnections
Multiple Local Pipeline Interconnections Provide Several Options for Access to Natural Gas Supply Targa Columbia Gulf Tennessee Cheniere Creole Trail Pipeline Trunkline Kinder Morgan Louisiana Pipeline NGPL Texas to Louisiana (bi-directional) Transco TETCO Tennessee FGT ) Existing Pipeline Grid Tran
Slide 34: Firm Liquefaction Capacity Additions
Firm Liquefaction Capacity Additions 0.00 0.25 0.50 0.75 1.00 1.25 1.50 1.75 2.00 2.25 2.50 2.75 3.00 13Q1 13Q2 13Q3 13Q4 14Q1 14Q2 14Q3 14Q4 15Q1 15Q2 15Q3 15Q4 16Q1 16Q2 16Q3 16Q4 17Q1 17Q2 17Q3 17Q4 18Q1 18Q2 18Q3 18Q4 2013 2014 2015 2016 2017 2018 Asia Pacific Atlantic Basin Bcf/d Skikda & Angol
Slide 35: Conversion of Class B and Subordinated Units
Conversion of Class B and Subordinated Units Mandatory conversion: within 90 days of the substantial completion of Train 3 Optional conversion by a Class B unitholder may occur at any of the following times: • After 83 months from issuance of EPC notice to proceed • Prior to the record date for
Slide 36: Pro Forma CQP Ownership
Pro Forma CQP Ownership Current common unit annualized distribution expected to be $1.70/unit (2) Class B units accrete 3.5% quarterly until converted into common units (1) Unit amounts are current units outstanding, including Blackstone’s total investment of $1.5B but excluding accretion of Cla
Slide 37: Condensed Balance Sheets
Condensed Balance Sheets As of June 30, 2013 (1) Includes intercompany eliminations and reclassifications. (2) For complete balance sheets, see the Cheniere Energy, Inc., Cheniere Energy Partners, L.P and Sabine Pass LNG, L.P. Quarterly Report on Form 10-Q for the quarter ended June 30, 2013, filed
Slide 38: Slide 38
Slide 39: Investor Relations Contacts
Nancy Bui: Director, Investor Relations – (713) 375-5280, nancy.bui@cheniere.com Christina Burke: Manager, Investor Relations – (713) 375-5104, christina.burke@cheniere.com Investor Relations Contacts:
Cheniere Energy — Investor Presentation (October 2013) on 6ix