Cheniere Energy, Inc. · NYSE:LNG
Cheniere Energy — Investor Presentation (August 2011)
29 slides from Cheniere Energy's investor presentation, Aug 3, 2011
Slide 1: Cheniere Energy, Inc. Corporate Presentation August 2011
Cheniere Energy, Inc. Corporate Presentation August 2011
Slide 2: 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, other than statements of his
Slide 3: Cheniere Operations
3 Cheniere Operations Cheniere is engaged in the development, construction and operation of LNG terminals and pipelines and marketing of LNG and natural gas Sabine Pass LNG became operational in 2008 and cost ~$1.6B, send-out capacity is 4.0 Bcf/d, storage capacity is 16.9 Bcfe Sabine Pass LNG is co
Slide 4: Contracted Capacity at SPLNG
4 Contracted Capacity at SPLNG Fully contracted capacity under long-term terminal use agreements* Total Gas & Power N.A. Chevron USA Cheniere Energy Investments Capacity 1.0 Bcf/d 1.0 Bcf/d 2.0 Bcf/d Fees (1) Reservation Fee (2) $0.28/MMBTU $0.28/MMBTU $0.28/MMBTU Opex Fee (3) $0.04/MMBTU $0.04/MMBT
Slide 5: Liquefaction Project
Liquefaction Project CHENIERE ENERGY
Slide 6: Bi-directional Service at Sabine Pass Provides Opportunity to Arbitrage Henry Hub vs. Oil
6 Bi-directional Service at Sabine Pass Provides Opportunity to Arbitrage Henry Hub vs. Oil Low High Henry Hub 4.00 $ 6.50 $ Capacity Charge 1.75 1.75 Shipping 1.00 1.00 Fuel 0.40 0.65 Delivered Cost 7.15 $ 9.90 $ Low High 4.00 $ 6.50 $ 1.75 1.75 2.80 2.80 0.40 0.65 8.95 $ 11.70 $ Europe Asia ($/MMB
Slide 7: Strategic Focus: Liquefaction Expansion Project
7 Strategic Focus: Liquefaction Expansion Project Cheniere is developing a project to add liquefaction trains, transforming the Sabine Pass LNG facility into the first bi-directional LNG terminal that can import & export LNG Proposing up to 4 liquefaction trains, 16 mtpa total nominal processing cap
Slide 8: Proposed Liquefaction Project will Transform Sabine into Bi-directional Import / Export Facility
8 Proposed Liquefaction Project will Transform Sabine into Bi-directional Import / Export Facility Current Facility 853 acres in Cameron Parish, LA 40 ft ship channel 3.7 miles from coast 2 berths; 4 dedicated tugs 5 LNG storage tanks (17 Bcf of storage) 4.3 Bcf/d peak regasification capacity 5.3 Bc
Slide 9: Sabine Pass Liquefaction Project - Brownfield Development, Lower Expected Capital Costs
9 Sabine Pass Liquefaction Project - Brownfield Development, Lower Expected Capital Costs Source: ConocoPhillips-Bechtel, Cheniere research. Project costs per ton are total project costs divided by mtpa capacity of LNG trains. Figures do not attempt to isolate, where applicable, the cost of the liqu
Slide 10: Engineering, Procurement & Construction Contract
10 Engineering, Procurement & Construction Contract Cheniere has engaged Bechtel Corporation (“Bechtel”) to complete front end engineering and design (“FEED”) work and negotiate a fixed price, lump-sum, turnkey EPC contract for the liquefaction project and interconnection with Sabine Pass’s existing
Slide 11: LNG Regulatory Process Update and Project Support
11 Base site permitted NEPA pre-filing 7/2010 for expansion Some agencies already in agreement Formal application filed 1/31/2011 FERC coordinates process and will receive concurrence for final EA Estimated approval early 2012 LNG Regulatory Process Update and Project Support Very strong local
Slide 12: Commercial Structure: Estimated Terms of LNG SPA Contracts
12 Fixed Fee: $2.00/MMBtu - $3.00/MMBtu Annual contract volumes are take-or-pay Cheniere procures natural gas, liquefies it and loads LNG onto the customer’s LNG vessel 115% of NYMEX Henry Hub 15% charge above Henry Hub predominantly to account for liquefaction process and basis differential Commerc
Slide 13: Expected Timeline
13 Expected Timeline Sign MOUs with interested parties Completed DOE export authorization Received Definitive commercial agreements 2H2011 EPC contract 2H2011 Financing commitments 2H2011 FERC construction authorization 2012 Commence construction 2012 Commence operations 2015 Milestone Target Date N
Slide 14: Summary Proposed Structure
14 Summary Proposed Structure Sabine Pass LNG, L.P. 88.5% through LP Interest 2% through GP Interest NYSE Amex US Stock Symbol: LNG NYSE Amex US Stock Symbol: CQP 9.5% LP Interest Public Unitholders Sabine Pass Liquefaction, LLC Vaporization assets Storage Berthing capacity Total TUA (1 Bcf/d) Chevr
Slide 15: Key Investment Highlights
15 Key Investment Highlights 20-year fixed price contracts with investment grade counterparties – stable contracted cash flows expected to begin 2015 Brownfield site minimizes construction costs – expansion economics Lump-Sum, Turnkey EPC contract with Bechtel ConocoPhillips Optimized Cascade Proces
Slide 16: Financial Overview
Financial Overview (All numbers reflect pre-Liquefaction financials) CHENIERE ENERGY
Slide 17: Cheniere Estimated 2011 Receipts and Disbursements
17 Disbursements G&A, net marketing Pipeline & tug services Other, incl adv tax payments Debt service Receipts Distributions from CQP (Common/GP) Management fees from CQP 45 - 55 *Estimates represent a summary of internal forecasts for 2011, are based on current assumptions and are subject to change
Slide 18: Estimated CQP Distributable Cash Flows
18 $ $ $ 0 – 250 Estimated CQP Distributable Cash Flows Annualized estimates pre-Liquefaction Project Receipts TUAs – Chevron and Total Other Services Total Cash Receipts Note: Estimates represent a summary of internal forecasts, are based on current assumptions and are subject to change. Actual per
Slide 19: CQP Ownership
19 CQP Ownership Common Units Subordinated Units General Partner @ 2% 15.6 10.9 135.4 3.3 Public Cheniere, Inc. 15.6 149.6 (in mm) 26.5 135.4 3.3 165.2 Total 90.5% 9.5% 100% Percent of total *CQP Ownership as of March 31, 2011. Does not reflect additional common units sold after March 31, 2011 throu
Slide 20: Condensed Balance Sheets
20 Condensed Balance Sheets As of March 31, 2011 Cheniere Energy Other Cheniere Consolidated Partners, L.P. Energy, Inc. (1) Cheniere Energy, Inc. (3) Unrestricted cash and equivalents $ - 24 $ 24 $ Restricted cash and securities (2) 184 4 188 Property, plant and equipment, net 1,542 603 2,145 Goodw
Slide 21: Organizational Structure
21 Organizational Structure 9.5% LP Interest 100% Ownership Interest $205 mm 2.25% Convertible Senior Unsecured Notes due 2012 NYSE Amex US: LNG NYSE Amex US: CQP $298 mm 9.75% Term Loan due 2012 $270 mm 12.0% Senior Secured Loans due 2018 Note: Abridged version of organization structure. Balances a
Slide 22: Appendix
CHENIERE ENERGY Appendix
Slide 23: Cheniere Overview
23 Cheniere Overview Cheniere Energy, Inc. NYSE Amex US: LNG Cheniere Marketing, LLC VCRA to monetize 2 Bcf/d capacity at SPLNG Cheniere LNG Holdings, LLC 90.5% Ownership of CQP Cheniere Energy Partners, L.P. NYSE Amex US: CQP Cheniere Creole Trail Pipeline L.P. 2 Bcf/d Takeaway Capacity for SPLNG S
Slide 24: Strategically Located – Extensive Market Access to Gas
24 Strategically Located – Extensive Market Access to Gas 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 Ea
Slide 25: Unconventional Plays – Comparative Rates of Return
25 Unconventional Plays – Comparative Rates of Return Source: Bentek Energy
Slide 26: ConocoPhillips-Bechtel – Global LNG Collaboration
26 ConocoPhillips-Bechtel – Global LNG Collaboration Source: ConocoPhillips, Bechtel Note: Past results not a guarantee of future performance. Proven Designs Collaboration projects onstream ahead of schedule and exceeded expectations 1969 1999 2007 2012 2006
Slide 27: Strategically Located – Multiple Pipeline Interconnects
27 Strategically Located – Multiple Pipeline Interconnects Cheniere Creole Trail Pipeline 2.0 Bcf/d Kinder Morgan Louisiana Pipeline 3.2 Bcf/d Total Pipeline Capacity 5.2 Bcf/d Transco Z3 Texas Eastern Trunkline Transco Z3 Pine Prairie Energy Center Egan Storage Jefferson Island Storage Hackberry St
Slide 28: North America Onshore Receiving Terminals
28 Everett Cove Point Elba Island Lake Charles Sabine Pass Freeport Golden Pass Cameron Costa Azúl Canaport Existing Under Construction Altamira Source: Websites of Terminal Owners North America Onshore Receiving Terminals Gulf LNG
Slide 29: Cheniere Energy Contacts
Cheniere Energy Contacts Katie Pipkin, Vice President Finance & Investor Relations (713) 375-5110 – katie.pipkin@cheniere.com Christina Burke, Manager Investor Relations (713) 375-5104 – christina.burke@cheniere.com CHENIERE ENERGY
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