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NOVEMBER 2011 CORPORATE PRESENTATION – Cheniere Energy, Inc.

Cheniere Energy, Inc. · Nov 10, 2011 · 38 slides

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Slides

  1. NOVEMBER 2011 CORPORATE PRESENTATION – Cheniere Energy, Inc. – slide 1
    Cheniere Energy November 2011
  2. NOVEMBER 2011 CORPORATE PRESENTATION – Cheniere Energy, Inc. – slide 2
    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…
  3. NOVEMBER 2011 CORPORATE PRESENTATION – Cheniere Energy, Inc. – slide 3
    Contracted Capacity at SPLNG Fully contracted capacity under long-term terminal use agreements* (4) 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) (2)…
  4. NOVEMBER 2011 CORPORATE PRESENTATION – Cheniere Energy, Inc. – slide 4
    CHENIERE ENERGY U.S. Natural Gas Markets
  5. NOVEMBER 2011 CORPORATE PRESENTATION – Cheniere Energy, Inc. – slide 5
    U.S. Gas Consumption vs. Production Since 2005 U.S. production growth 4.9 Tcf vs. demand growth 2.6 Tcf Net imports declined 1.6 Tcf (-50%) over the period 1 Tcf production added each year since 2006 The U.S. is on pace to be a net…
  6. NOVEMBER 2011 CORPORATE PRESENTATION – Cheniere Energy, Inc. – slide 6
    U.S. Proved Non-Producing Reserves (Tcf) Non-producing proved U.S. gas reserves +100% since 2003 to 98 Tcf Equivalent to 13 Bcf/d of LNG exports for 20+ years Over 3,000 gas wells drilled but not hooked up representing 8-10 Bcf/d…
  7. NOVEMBER 2011 CORPORATE PRESENTATION – Cheniere Energy, Inc. – slide 7
    U.S. Horizontal Rigs Emerging shale plays erase oil and gas drilling distinction Horizontal drilling +750% since 2005; pace of rig construction determines market capacity 1,200 HZ Rigs 1,000 800 600 400 Barnett Shale HZ…
  8. NOVEMBER 2011 CORPORATE PRESENTATION – Cheniere Energy, Inc. – slide 8
    Oil Production Drives Investment Decisions for Gas Expected liquids production from shale plays 3 million bpd by 2020 Associated natural gas 7 Bcf/d of costless supply Bcf/d Annual Production from Unconventional Reservoirs MMB/d 8…
  9. NOVEMBER 2011 CORPORATE PRESENTATION – Cheniere Energy, Inc. – slide 9
    Venting and Flaring The U.S. vented and flared 165 Bcf of natural gas in 2009 North Dakotas share amounted to 27 Bcf; +156% increase from 2007 There are many New Bakkens emerging in liquids-rich shale plays (Eagle Ford, Niobrara,…
  10. NOVEMBER 2011 CORPORATE PRESENTATION – Cheniere Energy, Inc. – slide 10
    U.S. Natural Gas Resources (Tcf) U.S. reserves increased by 86% in last 3 years to 2,543 Tcf Represents 100+ years of natural gas resources 2,543 2,119 1,747 1,365 2008 2009 2010 2011 Other Shale Source: DOE, Annual…
  11. NOVEMBER 2011 CORPORATE PRESENTATION – Cheniere Energy, Inc. – slide 11
    CHENIERE ENERGY Sabine Pass LNG: Liquefaction Project
  12. NOVEMBER 2011 CORPORATE PRESENTATION – Cheniere Energy, Inc. – slide 12
    Bi-directional Service at Sabine Pass Provides Opportunity to Arbitrage Henry Hub vs. Oil Worldwide LNG prices predominantly based on oil prices = 10 - 25 / MMBtu LNG Contract Price Indexation % 11% 15% at 90/bbl 9.90 13.50 at…
  13. NOVEMBER 2011 CORPORATE PRESENTATION – Cheniere Energy, Inc. – slide 13
    Attractive Oil Linked Market Prices Spread between oil linked and U.S. natural gas prices 911/mmbtu /MMBtu Regional Natural Gas & LNG Prices 12% 12% 15% 15% 20 of of Oil Oil Prices Prices 16 16.64 12 12.21 8 8.71 4…
  14. NOVEMBER 2011 CORPORATE PRESENTATION – Cheniere Energy, Inc. – slide 14
    Global Petroleum Demand Stationary Sources FSU FSU 0.9 0.9 MM MM b/d b/d Europe Europe 5 Bcf/d 5 Bcf/d US US && Canada Canada 2.9 2.9 MM MM b/d b/d 2.2 2.2 MM b/d MM b/d 17 Bcf/d 17 Bcf/d 13 13 Bcf/d Bcf/d Mid…
  15. NOVEMBER 2011 CORPORATE PRESENTATION – Cheniere Energy, Inc. – slide 15
    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…
  16. NOVEMBER 2011 CORPORATE PRESENTATION – Cheniere Energy, Inc. – slide 16
    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 Existing…
  17. NOVEMBER 2011 CORPORATE PRESENTATION – Cheniere Energy, Inc. – slide 17
    Commercial Structure: Estimated Terms of LNG SPA Contracts Summary of Estimated Terms for LNG SPA Contracts: Fixed Fee: 2.00/MMBtu - 3.00/MMBtu Annual contract volumes are take-or-pay Cheniere procures natural gas, liquefies it…
  18. NOVEMBER 2011 CORPORATE PRESENTATION – Cheniere Energy, Inc. – slide 18
    Commercial Contracts: SPAs Signed to Date BG contracted for 3.5 mtpa, half of the target quantity for two trains- in discussions with potential customers for remaining half BG Contract: BG Gulf Coast, LLC has contracted for 3.5…
  19. NOVEMBER 2011 CORPORATE PRESENTATION – Cheniere Energy, Inc. – slide 19
    Sabine Pass Liquefaction Project - Brownfield Development, Lower Expected Capital Costs Range of liquefaction project costs: 200 - 2,000 per ton Cost: /ton 1 Bcf/d of capacity = 1.5 B to 9 B 2000 Sabine Pass Liquefaction project…
  20. NOVEMBER 2011 CORPORATE PRESENTATION – Cheniere Energy, Inc. – slide 20
    Engineering, Procurement & Construction Contract (EPC Contract) Signed lump sum, turnkey contract with Bechtel for first two trains Sabine Liquefaction has entered into a lump sum turnkey contract with Bechtel for the engineering,…
  21. NOVEMBER 2011 CORPORATE PRESENTATION – Cheniere Energy, Inc. – slide 21
    LNG Regulatory Process Update and Project Support Very strong local support: Cameron Parish officials, Louisiana state and federal congressional delegations, parish & state agencies Strong support from most gas producing states…
  22. NOVEMBER 2011 CORPORATE PRESENTATION – Cheniere Energy, Inc. – slide 22
    Summary Proposed Structure NYSE Amex US Stock Symbol: LNG 86.8% through LP Interest NYSE Amex US 2% through GP Interest Stock Symbol: CQP 11.2% LP Interest Public Unitholders NEW EQUITY 100% 2 Bcf/d TUA Sabine Pass…
  23. NOVEMBER 2011 CORPORATE PRESENTATION – Cheniere Energy, Inc. – slide 23
    Estimated Financial Impact - Liquefaction Project (Annualized) Cheniere expected to benefit from distributions received through its CQP ownership and management contracts, and fees paid to Creole Trail Pipeline Contracted…
  24. NOVEMBER 2011 CORPORATE PRESENTATION – Cheniere Energy, Inc. – slide 24
    Expected Timeline Milestone Target Date DOE export authorization Received Definitive commercial agreements 2H2011 EPC contract Complete Financing commitments 2H2011 FERC construction authorization 2012 Commence construction…
  25. NOVEMBER 2011 CORPORATE PRESENTATION – Cheniere Energy, Inc. – slide 25
    CHENIERE ENERGY LNG Fundamentals
  26. NOVEMBER 2011 CORPORATE PRESENTATION – Cheniere Energy, Inc. – slide 26
    Global LNG Market LNG Importers Price Indexation Oil Products 2010 Total Global LNG Capacity 37 Bcf/d Natural Gas 2010 Regional LNG Demand 30 Bcf/d Algeria - 2.7 JCC Norway - 0.6 Egypt - 1.6 USA - 0.2 Qatar - 9.3 Russia -…
  27. NOVEMBER 2011 CORPORATE PRESENTATION – Cheniere Energy, Inc. – slide 27
    Firm Liquefaction Capacity Additions Bcf/d Nameplate Liquefaction Capacity 37 Bcf/d by YE 2010 3.0 44 Bcf/d by YE 2015 Middle East Gulf 2.5 Asia Pacific Atlantic Basin Gorgon T1 & Gassi Touil Papua New Guinea 2.0 Gorgon T2 &…
  28. NOVEMBER 2011 CORPORATE PRESENTATION – Cheniere Energy, Inc. – slide 28
    Market Call for LNG (Bcf/d) Average 2010 LNG demand of 30 Bcf/d at 10-year historical compound average growth rate of 7% per year equates to 42 Bcf/d of demand in 2015 Next wave of LNG supply expected to come from Australian and…
  29. NOVEMBER 2011 CORPORATE PRESENTATION – Cheniere Energy, Inc. – slide 29
    CHENIERE ENERGY Financial
  30. NOVEMBER 2011 CORPORATE PRESENTATION – Cheniere Energy, Inc. – slide 30
    Organization Structure and Existing Debt NYSE Amex US: LNG 205 mm 2.25% Convertible Senior Unsecured Notes due August 2012 100% Ownership Interest 298 mm 9.75% Term Loan due May 2012 Cheniere LNG Holdings, LLC 278 mm 12.0%…
  31. NOVEMBER 2011 CORPORATE PRESENTATION – Cheniere Energy, Inc. – slide 31
    Estimated CQP Distributable Cash Flows Annualized estimates pre-Liquefaction Project Receipts TUAs Chevron and Total 253 Other Services 16 Total Cash Receipts 269 Costs Operating, G&A, Maintenance CapEx 48 Debt Service 165…
  32. NOVEMBER 2011 CORPORATE PRESENTATION – Cheniere Energy, Inc. – slide 32
    CQP Ownership Cheniere (in mm) Energy, Inc. Public Total Common Units 12.0 19.0 31.0 Subordinated Units 135.4 - 135.4 General Partner 2% 3.4 - 3.4 150.8 19.0 169.8 Percent of total 88.8% 11.2% 100% Currently, CQP generates…
  33. NOVEMBER 2011 CORPORATE PRESENTATION – Cheniere Energy, Inc. – slide 33
    Estimated LNG Net Cash Flows* Annualized estimates pre-Liquefaction Project Cash receipts expected to increase from CQP driven by Liquefaction Project - unit distributions, management fees and Creole Trail P/L tariffs Receipts…
  34. NOVEMBER 2011 CORPORATE PRESENTATION – Cheniere Energy, Inc. – slide 34
    Condensed Balance Sheets As of September 30, 2011 ( in MM) Cheniere Energy Other Cheniere Consolidated Partners, L.P. Energy, Inc. (1) Cheniere Energy, Inc. (3) Unrestricted cash and equivalents - 131 131 - Restricted cash and…
  35. NOVEMBER 2011 CORPORATE PRESENTATION – Cheniere Energy, Inc. – slide 35
    CHENIERE ENERGY Appendix
  36. NOVEMBER 2011 CORPORATE PRESENTATION – Cheniere Energy, Inc. – slide 36
    Strategically Located Extensive Market Access to Gas Lower 48 Recoverable Unconventional Primary Gas Sources for Sabine Pass Liquefaction Reserves (Tcf) Conventional Gulf Coast Onshore; Barnett; Haynesville; Bossier; Eagle Ford…
  37. NOVEMBER 2011 CORPORATE PRESENTATION – Cheniere Energy, Inc. – slide 37
    North America Onshore Receiving Terminals Terminal Baseload Capacity Holder Sendout (MMcf/d) Canaport Canaport Canaport 1,000 Repsol Everett - Suez 700 Everett Cove Point 1,800 Everett BP, Statoil, Shell Elba Island 1,800…
  38. NOVEMBER 2011 CORPORATE PRESENTATION – Cheniere Energy, Inc. – slide 38
    CHENIERE ENERGY Cheniere Energy Contacts Katie Pipkin, Vice President Finance & Investor Relations (713) 375-5110 katie.pipkincheniere.com Christina Burke, Manager Investor Relations (713) 375-5104 christina.burkecheniere.com

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