Cheniere Energy third-quarter profit beats despite weaker LNG prices
Nov 2 (Reuters) — Liquefied natural gas (LNG) exporter Cheniere Energy reported a third-quarter profit on Thursday that beat analysts’ estimates even as the company grappled with lower natural gas prices and export volumes.
The company said results for the quarter included a $1.4 billion gain related to the value of its derivatives portfolio.
Houston-based Cheniere’s loaded LNG volumes fell to 548 trillion British thermal units (tbtu), compared with 559 tbtu in the year-earlier period.
The company reported a profit of $7.03 per share, compared with estimates of $2.53, according to LSEG data.
Cheniere reaffirmed its full-year earnings forecast of between $8.3 billion and $8.8 billion. CEO Jack Fusco said the company was “confident in achieving full year 2023 results at the high end of guidance ranges”.
U.S. natural gas prices were down about 60% in the July-September quarter as production in the United States continued to rise and concerns eased over energy security in Europe.
Cheniere posted revenue of $4.2 billion for the third quarter, compared with $8.9 billion a year earlier. The company said the fall in revenue was due to lower natural gas pricing at the U.S. benchmark Henry Hub.
Separately, Cheniere said it has entered into an agreement to supply about 0.9 million tonnes per annum of LNG to Foran Energy Group for 20 years.
Deliveries will commence upon the start of commercial operations of the second train of the Sabine Pass liquefaction expansion project.
(Reporting by Mrinalika Roy in Bengaluru; Editing by Shounak Dasgupta)
Related Knowledge Center: Liquefied natural gas
Driven by plentiful natural gas produced from shale plays, the United States began exporting liquefied natural gas in 2016 when the Sabine Pass terminal in Louisiana opened and shipped its first cargo. Since then, additional capacity, or trains, have been added to Sabine Pass, and terminals have become operational in Cameron Parish, La.; Hackberry, La.; Cove Point, Md.; and Corpus Christi, Texas. The Energy Information Administration projects that U.S. LNG export capacity will reach 8.9 billion cubic feet per day (Bcf/d) by the end of 2019, making it the third largest in the world, behind Australia and Qatar. The tariff war with China has the potential to impact some final investment decisions for additional terminals in the coming months.