Cheniere Energy, Inc. · NYSE:LNG
Cheniere Energy — Investor Presentation (May 2005)
20 slides from Cheniere Energy's investor presentation, May 12, 2005
Slide 1: Cheniere Energy, Inc.
Cheniere Energy, Inc. *Freeport LNG L.P. (Cheniere 30% Limited Partner) *Sabine Pass LNG L.P. (Cheniere 100%) *Corpus Christi LNG L.P. (Cheniere 100%) *Creole Trail LNG L.P. (Cheniere 100%) *Artist’s Rendition May 2005
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: Cheniere LNG Receipt Network
Cheniere LNG Receipt Network 4 Deepwater Ports 7 Unloading Docks 12 Storage Tanks (40 Bcf equivalent) 10-11.4 Bcf/d Regas Capacity Optionality Flexibility Reliability Liquidity Low Cost Sabine Pass Freeport (30%) Corpus Christi Creole Trail 3.3 Bcf/d 2.6 – 4.0 Bcf/d 1.5 Bcf/d 2.6 Bcf/d
Slide 4: Project Overviews
Project Overviews Land Est. Operational Storage Capacity Capex ($mm) 1 Tanks Creole Trail Berths Initial Capacity Corpus Christi Sabine Pass Freeport Q3 2006 (exp.) Q4 2005 (exp.) Under Construction Under Construction Ground Breaking NEPA pre-filing January 2005 Final EIS March 2005 Authorization to
Slide 5: Target Gas Demand Corridor Market Access
Target Gas Demand Corridor Market Access – 29 Bcf/d Midwest Markets 11.8 Bcf/d Northeast Markets 5.7 Bcf/d Southeast Markets 4.6 Bcf/d Gulf Coast Markets 4.9 Bcf/d Mexican Markets 1.7 Bcf/d Source: Cheniere Research Cheniere LNG Receipt Network
Slide 6: Coastal States Gas Consumption
Coastal States Gas Consumption 1.0 1.9 1.0 0.7 1.2 0.7 0.7 0.2 0.4 0.6 0.7 Top 5 Coastal Consumers TX, CA, LA, NY, FLA Source: EIA, NG Monthly, April 2004 In Bcf/d 2003 11.2 3.4 1.9 6.1 3.1 1.7
Slide 7: FERC Permit Status
FERC Permit Status 4 Onshore applications approved by FERC – 8.2 Bcf/d 9 Onshore applications filed w/ FERC – 9.8 Bcf/d Outside U.S. for U.S. Markets (Bahamas and Mexico) FERC Approved Cameron LNG (LA) Corpus Christi – (TX) Freeport LNG (TX) Sabine Pass – (LA) Filed with FERC Calhoun LNG – (TX ) Wea
Slide 8: Commercial Status
Commercial Status 1.5 1.0 1.6 2.3 1.0 1.7 1 1.0 1.0 .3 1 Corpus Christi 2.6 Bcf/d Freeport 1.5 Bcf/d Sabine Pass 2 4.0 Bcf/d Creole Trail 3.3 Bcf/d Firm TUAs Marketing TUAs Under Option, subject to negotiation Cheniere Retained Chevron has 0.7 Bcf/d of reserved capacity with the option to reduce to
Slide 9: Terminal Use Agreements (TUAs)
Terminal Use Agreements (TUAs) Sabine TUA monthly payment amounts of $0.32/MMbtu plus retain 2% of the LNG delivered for use as fuel at the facility 20 years or longer Take-or-pay contract terms Investment grade tenants F r e e p o r t L N G Dow Chemical Company* ConocoPhillips Company* S a b i n e
Slide 10: Estimated TUA Annual Revenue
Estimated TUA Annual Revenue $230 3.2 Total Contracted Contracted Contracted TUA Status $0.32 $0.32 Fee ($/MMbtu) $ 15 1.5 Freeport $125 $ 90 Calculated Revenue to Cheniere ($mm) 1 1.0 0.7 2 Sabine Pass 3 Total, S.A. Chevron TUA Capacity (Bcf/d) Revenue calculations are based solely on TUAs and refl
Slide 11: Sabine Pass Capacity Opportunities
Sabine Pass Capacity Opportunities $39 $0.32 0.3 1 Option Chevron $129 1.3 Total Option - subject to negotiation TUA Status $0.24 Fee ($/MMbtu) $90 Calculated Revenue to Cheniere ($MM) 1.0 Expansion of existing customers TUA Capacity (Bcf/d) 1 Chevron has 0.7 Bcf/d of reserved capacity with the opti
Slide 12: Current Marketing Efforts
Current Marketing Efforts Marketing Efforts 2 Bcf/d at Corpus or Creole at $0.32 / MMBtu Potential Revenues: $250 million Indexed Gas Purchase - Example 1 Bcf/d Gulf Coast delivery at 83% of Henry Hub price Potential Revenues: 17% of $4.00/MMBtu @ Henry Hub: $260 million
Slide 13: Terminal Use Agreement Summary
Terminal Use Agreement Summary $609 6.5 Total 2.0 Corpus Christi or Creole Trail Marketing Capacity* 1.0 Expansion of Existing Customers** 0.3 Chevron* Sabine Pass Capacity Opportunities 1.7 Sabine Pass $15 1.5 Freeport Contracted Capacity Calculated Revenue to Cheniere ($MM) TUA Capacity (Bcf/d) *
Slide 14: Indexed Purchase Agreements
Indexed Purchase Agreements Growth of liquefaction Increasing domestic supply/demand gap Scarcity of flexible, cheap receiving terminals Cheniere’s retention of remaining capacity is strategically important
Slide 15: Projected Liquefaction Growth
Projected Liquefaction Growth Source: Cheniere Research Bcf/d
Slide 16: Production vs Consumption (Tcf)
Production vs Consumption (Tcf) Cheniere estimate based on 2% annual average decline in production, 1% annual average growth in consumption post-2008 based on EIA, AEO Historical production and consumption EIA 8 Tcf or 22 Bcf/d Forecast Historical Domestic Production Consumption
Slide 17: U.S. Onshore Regasification Terminals Currently Under Construction
U.S. Onshore Regasification Terminals Currently Under Construction S a b i n e P a s s L N G F r e e p o r t L N G
Slide 18: Future Business Development
Future Business Development Total Excess Capacity Marketing Efforts TUA Opportunities Under Negotiation Contracted TUAs Bcf/d 3.9 Total 1.0 Index Gas Purchases 11.4 4.9 2.0 1.3 3.2 Total 3.3 2.3 1.0 Creole Trail 2.6 1.6 1.0 Corpus Christi 4.0 1.0 1.3 1.7 Sabine Pass 1.5 1.5 Freeport
Slide 19: Indexed Purchase Agreement Model
Indexed Purchase Agreement Model Regasification costs and transportation to liquidity points Additional Costs: At $4.00 Mcf; $0.68 per MMbtu; $260 million Revenue Example: Seller’s responsibility Shipping: 83% of NYMEX Cost Assumption: U.S. Gulf Coast at any Cheniere LNG regasification terminal Deli
Slide 20: Long-Term Model
Long-Term Model $MM Freeport Contracted TUAs Optioned – subject to negotiation TUAs Under Marketing Efforts $609 Potential Indexed Gas Purchases - 1 Bcf/d $260 Total Potential Revenues $845 Cheniere Future Business Development (Bcf/d) 3.9 NOTE: These are revenue objectives and are subject to operati