USA: Cheniere Logs Q1 Net Loss of USD 19.3 Million

For the quarter ended March 31, 2012, Cheniere Energy Partners reported a net loss of $19.3 million compared with a net loss of $2.2 million for the same period in 2011.

Results include development expenses for the Sabine Pass Liquefaction Project of $17.9 million for the quarter ended March 31, 2012 and $7.5 million for the comparable 2011 period.

Overview of Significant 2012 Events

• In January 2012, Sabine Pass Liquefaction, a wholly owned subsidiary of Cheniere Partners, entered into an amended and restated LNG Sale and Purchase Agreement (SPA) with BG Gulf Coast LNG, a subsidiary of BG Group plc, under which BG has agreed to purchase an additional 2.0 million tonnes per annum of LNG, bringing BG’s total annual contract quantity to 5.5 mtpa of LNG. BG will purchase 3.5 mtpa of LNG with the commencement of train one operations and will purchase a portion of the additional 2.0 mtpa of LNG as each of trains two, three and four commences operations.
• In January 2012, Sabine Pass Liquefaction entered into an SPA with Korea Gas Corporation (KOGAS), under which KOGAS agreed to purchase 182.5 million MMBtu of LNG per year (approximately 3.5 mtpa).
• In February 2012, we entered into discussions with Blackstone Energy Partners L.P., Blackstone Capital Partners VI L.P., and certain affiliates, whereby Blackstone would fund an equity portion of the financing to develop, construct and place into service the Liquefaction Project.
• In April 2012, Sabine Pass Liquefaction and Sabine Pass LNG received authorization under Section 3 of the Natural Gas Act from the Federal Energy Regulatory Commission (FERC) to site, construct and operate facilities for the liquefaction and export of domestically produced natural gas at the Sabine Pass LNG terminal located in Cameron Parish, Louisiana. The Order authorizes the development of up to four modular LNG trains.
• In April 2012, we engaged eight financial institutions to act as Joint Lead Arrangers to assist in the structuring and arranging of up to $4 billion of debt facilities. The proceeds will be used to pay for costs of development and construction of the Liquefaction Project, to fund the acquisition of the Creole Trail Pipeline from Cheniere and for general business purposes.

Q1 2012 Results
Cheniere Partners reported income from operations of $24.9 million for the quarter ended March 31, 2012, compared to income from operations of $41.1 million for the comparable 2011 period. The decrease in income from operations of $16.2 million quarter over quarter was primarily due to an increase in development expenses of $10.4 million and a decrease in revenues of $5.1 million. Development expenses include costs incurred to develop the Liquefaction Project.

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LNG World News Staff, May 4, 2012