Operations costs dent Cheniere’s figures

Houston-based LNG exporter Cheniere Energy’s quarterly loss reported a net loss of $114 million during the second quarter of the year as new trains start-up pushed the operating costs up. 

For the first six months of the year, Cheniere’s net profit slipped from $339 million to $27 million during the first half of 2019, the company’s report says.

Net loss increase during the second quarter and net income decrease during the six months was primarily due to increased total operating costs and expenses as a result of additional trains in operation and certain maintenance and related activities at the Sabine Pass LNG project, increased interest expense, increased net derivative loss, and decreased margins per MMBtu of LNG recognized in income primarily due to decreased pricing on LNG sold by Cheniere’s marketing affiliate.

This was partially offset by increased volumes of LNG recognized in income and decreased net income attributable to non-controlling interest.

“The second quarter was highlighted by continued execution on our growth plans through a positive FID on train 6 at Sabine Pass, continued commercial innovation with the long-term IPM contract with Apache, and continued financial discipline, reflected in the capital allocation framework we announced during the quarter,” said Jack Fusco, Cheniere’s president and CEO.

“LNG volumes in our portfolio, via early completion of trains and excellent operational performance at both Sabine Pass and Corpus Christi, continue to help offset relative softness in short-term LNG market pricing.”

Cheniere said in its report that 104 LNG cargoes were exported from its liquefaction projects, one of which was a commissioning cargo.

During the six months ended June 30, 2019, 191 LNG cargoes were exported from Cheniere’s liquefaction projects, of which eight were commissioning cargoes.

Twelve cargoes exported from Cheniere’s liquefaction projects and sold on a delivered basis were in transit as of June 30, 2019, one of which was a commissioning cargo.

Cheniere added that as of July 31, 2019, over 750 cumulative LNG cargoes have been produced, loaded and exported from its liquefaction projects.