CHENIERE ENERGY HOUSTON, April 30, 2015 /PRNewswire/ -- Cheniere Energy, Inc. ("Cheniere") (NYSE MKT: LNG) reported a net loss attributable to common stockholders of $267.7 million, or $1.18 per share (basic and diluted), for the three months ended March 31, 2015, compared to a net loss attributable to common stockholders of $97.8 million, or $0.44 per share (basic and diluted), for the comparable 2014 period.
Results include significant items for the three months ended March 31, 2015 of $231.0 million, compared to $46.8 million for the comparable 2014 period. The significant items for the three months ended March 31, 2015 related to derivative losses due primarily to contingent interest rate derivatives entered into and changes in long-term LIBOR during the period, losses on early extinguishment of debt related to the write-off of debt issuance costs by Sabine Pass Liquefaction, LLC ("SPL") in connection with the refinancing of a portion of its credit facilities in March 2015, and for development expenses primarily for the liquefaction facilities being developed by us near Corpus Christi, Texas (the "CCL Project").
Included in general and administrative expense were non-cash compensation expenses of $15.2 million for the three months ended March 31, 2015, compared to $34.6 million for the comparable 2014 period.
Results are reported on a consolidated basis and include our ownership interest in Cheniere Energy Partners, L.P. ("Cheniere Partners"), which is based on our 100% ownership of the general partner of Cheniere Partners and 80.1% ownership interest in Cheniere Energy Partners LP Holdings, LLC which owns a 55.9% limited partner interest in Cheniere Partners.
Recent Significant Events
-- In March 2015, SPL issued an aggregate principal amount of $2.0 billion
of 5.625% Senior Secured Notes due 2025. Net proceeds from the offering
are being used to pay a portion of the capital costs associated with the
construction of the first four natural gas liquefaction trains
("Trains") of the SPL Project (described below).
-- In March 2015, we issued an aggregate principal amount of $625.0 million
Convertible Senior Notes due 2045 (the "2045 Convertible Senior Notes")
through a registered direct offering. The 2045 Convertible Senior Notes
were issued with an original issue discount of 20% and accrue interest
at a rate of 4.25% per annum, which is payable semi-annually in arrears.
The net proceeds will be used for general corporate purposes.
-- In April 2015, Cheniere Partners received authorization from the Federal
Energy Regulatory Commission ("FERC") to site, construct and operate
Trains 5 and 6 of the SPL Project.
Liquefaction Projects Update
SPL Project
Through Cheniere Partners we are developing up to six Trains, each with an expected nominal production capacity of approximately 4.5 million tonnes per annum ("mtpa"), at the Sabine Pass LNG terminal adjacent to the existing regasification facilities.
The Trains are in various stages of development.
-- Construction on Trains 1 and 2 began in August 2012, and as of March 31,
2015, the overall project completion percentage for Trains 1 and 2 was
approximately 87.2%, which is ahead of the contractual schedule. Based
on our current construction schedule, we anticipate that Train 1 will
produce LNG as early as late 2015.
-- Construction on Trains 3 and 4 began in May 2013, and as of March 31,
2015, the overall project completion percentage for Trains 3 and 4 was
approximately 62.6%, which is ahead of the contractual schedule. We
expect Trains 3 and 4 to become operational in late 2016 and 2017,
respectively.
-- Trains 5 and 6 are under development. We have entered into SPAs for
approximately 3.75 mtpa in aggregate that commence with the date of
first commercial delivery for Train 5. We have received authorizations
from the DOE to export 503 Bcf per year of LNG volumes from Trains 5 and
6 to free trade agreement ("FTA") countries. Authorization to export LNG
to non-FTA countries is pending. In April 2015, Cheniere Partners
received FERC authorization to site, construct, and operate Trains 5 and
6.
We will contemplate making a final investment decision to commence construction of Trains 5 and 6 based upon, among other things, entering into EPC contracts, entering into acceptable commercial arrangements, receiving all regulatory approvals and obtaining adequate financing. We expect to commence construction on Train 5 upon receiving all regulatory approvals and obtaining financing followed by Train 6 upon entering into acceptable commercial arrangements, receiving all regulatory approvals and obtaining financing.
CCL Project
We continue to make progress on the development of the CCL Project, which is being designed for up to three Trains with expected aggregate nominal production capacity of approximately 13.5 mtpa of LNG.
-- To date we have entered into SPAs aggregating approximately 7.6 mtpa of
LNG volumes commencing with Trains 1 and 2, and approximately 0.8 mtpa
of LNG volumes commencing with Train 3.
-- In December 2014, we received authorization from the FERC to site,
construct, and operate the CCL Project. Subsequent to the issuance of
the authorization, the FERC received a rehearing request and has not yet
ruled on this request. We have received authorization from the U.S.
Department of Energy ("DOE") to export up to approximately 767 Bcf per
year of domestically produced LNG to FTA countries. Authorization from
the DOE to export LNG to non-FTA countries is pending.
We will contemplate making a final investment decision to commence construction of the CCL Project based upon, among other things, entering into acceptable commercial arrangements, receiving all regulatory approvals and obtaining adequate financing. To date, we have obtained financing commitments sufficient to support the financing of all three Trains. We expect to receive the remaining regulatory approvals during the first half of 2015. We expect to commence construction on the first two Trains in due course upon receiving all regulatory approvals followed by the third Train upon entering into additional sale and purchase agreements.
Timelines for Liquefaction Projects
Target Date
-----------
SPL CCL
--- ---
Milestone Trains Trains Trains
1 - 4 5 & 6 1 - 3
--- ----- ----- -----
DOE
export
authorization Received Received FTA Received FTA
Pending Non-FTA
Pending Non-FTA
Definitive
commercial
agreements Completed T5: Completed T1-T2: Completed
16.0 mtpa T6: 2015 T3: 2015
-BG
Gulf
Coast
LNG,
LLC 5.5 mtpa
-Gas
Natural
Fenosa 3.5 mtpa
-
KOGAS 3.5 mtpa
-GAIL
(India)
Ltd. 3.5 mtpa
-
Total
Gas &
Power
N.A. 2.0 mtpa
-
Centrica
plc 1.75 mtpa
-PT
Pertamina
(Persero) 1.52 mtpa
-
Endesa,
S.A. 2.25 mtpa
-
Iberdrola,
S.A. 0.76 mtpa
-Gas
Natural
Fenosa
LNG
SL 1.50 mtpa
-
Woodside
Energy
Trading
Singapore 0.85 mtpa
-
Electricite
de
France,
S.A. 0.77 mtpa
-EDP
Energias
de
Portugal
S.A. 0.77 mtpa
EPC
contracts Completed 2015 Completed
Financing Completed 2015 2015
-
Equity
commitments Received
-Debt
commitments Received
FERC
authorization Completed
-FERC
Order Received Received
-
Certificate
to
commence
construction 2015 2015
Issue
Notice
to
Proceed Completed 2015 2015
Commence
operations 2015 - 2017 2018/2019 2018/2019
Cheniere Energy, Inc. is a Houston-based energy company primarily engaged in LNG-related businesses, and owns and operates the Sabine Pass LNG terminal and Creole Trail Pipeline in Louisiana. Cheniere is pursuing related business opportunities both upstream and downstream of the Sabine Pass LNG terminal. Through its subsidiary, Cheniere Energy Partners, L.P., Cheniere is developing a liquefaction project at the Sabine Pass LNG terminal adjacent to the existing regasification facilities for up to six Trains, each of which is expected to have a nominal production capacity of approximately 4.5 mtpa. Construction has begun on Trains 1 through 4 at the SPL Project. Cheniere has also initiated a project to develop liquefaction facilities near Corpus Christi, Texas. The CCL Project is being designed for up to three Trains, with expected aggregate nominal production capacity of approximately 13.5 mtpa of LNG, three LNG storage tanks with capacity of approximately 10.1 Bcfe and two LNG carrier docks. Commencement of construction for the CCL Project is subject, but not limited, to obtaining regulatory approvals, entering into long-term customer contracts sufficient to underpin financing of the project, obtaining financing, and Cheniere making a final investment decision. Cheniere believes that LNG exports from the CCL Project could commence as early as 2018.
For additional information, please refer to the Cheniere website at www.cheniere.com and Quarterly Report on Form 10-Q for the quarter ended March 31, 2015, filed with the Securities and Exchange Commission.
This press release contains certain statements that may include "forward-looking statements" within the meanings of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements, other than statements of historical fact, included herein are "forward-looking statements." Included among "forward-looking statements" are, among other things, (i) statements regarding Cheniere's business strategy, plans and objectives, including the construction and operation of liquefaction facilities, (ii) statements regarding expectations regarding regulatory authorizations and approvals, (iii) statements expressing beliefs and expectations regarding the development of Cheniere's LNG terminal and pipeline businesses, including liquefaction facilities, (iv) statements regarding the business operations and prospects of third parties, (v) statements regarding potential financing arrangements and (vi) statements regarding future discussions and entry into contracts. Although Cheniere believes that the expectations reflected in these forward-looking statements are reasonable, they do involve assumptions, risks and uncertainties, and these expectations may prove to be incorrect. Cheniere's actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including those discussed in Cheniere's periodic reports that are filed with and available from the Securities and Exchange Commission. You should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Other than as required under the securities laws, Cheniere does not assume a duty to update these forward-looking statements.
(Financial Tables Follow)
Cheniere Energy, Inc.
Consolidated Statements of Operations
(in thousands, except per share data)(1)
(unaudited)
Three Months Ended
March 31,
---------
2015 2014
---- ----
Revenues
LNG terminal revenues $67,581 $66,419
Marketing and trading revenues 662 657
Other 126 474
--- ---
Total revenues 68,369 67,550
Operating costs and expenses
General and administrative
expense 58,017 73,808
Operating and maintenance
expense 37,153 13,687
Depreciation expense 17,769 15,475
Development expense 16,096 12,112
Other 332 80
--- ---
Total operating costs and
expenses 129,367 115,162
------- -------
Loss from operations (60,998) (47,612)
Other income (expense)
Interest expense, net (59,612) (40,270)
Loss on early extinguishment
of debt (88,992) -
Derivative loss, net (125,936) (34,681)
Other income 372 310
--- ---
Total other expense (274,168) (74,641)
-------- -------
Loss before income taxes and
non-controlling interest (335,166) (122,253)
Income tax provision (678) (92)
---- ---
Net loss (335,844) (122,345)
Less: net loss attributable to
non-controlling interest (68,135) (24,535)
------- -------
Net loss attributable to
common stockholders $(267,709) $(97,810)
========= ========
Net loss per share
attributable to common
stockholders-basic and
diluted $(1.18) $(0.44)
====== ======
Weighted average number of
common shares outstanding-
basic and diluted 226,328 223,207
Cheniere Energy, Inc.
Consolidated Balance Sheets
(in thousands, except share data)(1)
March 31, December 31,
2015 2014
---- ----
ASSETS (unaudited)
Current assets
Cash and cash equivalents $2,158,338 $1,747,583
Restricted cash and cash
equivalents 457,456 481,737
Accounts and interest receivable 32,503 4,419
LNG inventory 16,282 4,294
Prepaid expenses and other 38,480 20,844
------ ------
Total current assets 2,703,059 2,258,877
Non-current restricted cash and
cash equivalents 1,856,524 550,811
Property, plant and equipment,
net 9,852,970 9,246,753
Debt issuance costs, net 217,363 242,323
Non-current derivative assets 472 11,744
Goodwill 76,819 76,819
Other non-current assets 215,840 186,356
------- -------
Total assets $14,923,047 $12,573,683
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable $20,953 $13,426
Accrued liabilities 255,815 169,147
Deferred revenue 26,653 26,655
Derivative liabilities 18,046 23,247
------ ------
Total current liabilities 321,467 232,475
Long-term debt, net 12,117,880 9,806,084
Non-current deferred revenue 12,500 13,500
Other non-current liabilities 116,829 20,107
Commitments and contingencies
Stockholders' equity
Preferred stock, $0.0001 par
value, 5.0 million shares
authorized, none issued - -
Common stock, $0.003 par value
Authorized: 480.0 million shares at March 31, 2015
and December 31, 2014
Issued and outstanding: 236.7
million shares at March 31, 2015
and December 31, 2014 712 712
Treasury stock: 10.7 million
shares and 10.6 million shares
at March 31, 2015 and December
31, 2014, respectively, at cost (296,523) (292,752)
Additional paid-in-capital 2,989,221 2,776,702
Accumulated deficit (2,916,548) (2,648,839)
---------- ----------
Total stockholders' deficit (223,138) (164,177)
Non-controlling interest 2,577,509 2,665,694
--------- ---------
Total equity 2,354,371 2,501,517
--------- ---------
Total liabilities and equity $14,923,047 $12,573,683
=========== ===========
(1) Please refer to the Cheniere
Energy, Inc. Quarterly Report
on Form 10-Q for the quarter
ended March 31, 2015, filed
with the Securities and
Exchange Commission.
As of March 31, 2015, we had cash and cash equivalents of $2,158.3 million available to Cheniere. In addition, we had current and non-current restricted cash and cash equivalents of $2,314.0 million (which included current and non-current restricted cash and cash equivalents available to Cheniere Partners, SPL and Sabine Pass LNG, L.P.) designated for the following purposes: $1,953.7 million for the SPL Project, $28.1 million for Cheniere Creole Trail Pipeline, L.P., $129.1 million for interest payments related to the Sabine Pass LNG senior secured notes, and $203.1 million for other restricted purposes.
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SOURCE Cheniere Energy, Inc.
