Cheniere, Endesa in Second LNG Pact - Analyst Blog
April 08 2014 - 7:30PM
Zacks
Publicly traded energy firm Cheniere Energy
Inc. (LNG) announced that it has signed a second liquefied
natural gas (“LNG”) sale and purchase agreement (SPA) with Spanish
electric utility firm, Endesa Genercion S.A. The deal involves the
sale of about 0.75 million tons per annum (mtpa) of LNG from
Cheniere’s planned Corpus Christi Liquefaction Project.
The total quantity under agreement now stands at 2.25 mpta,
including the 1.5 mtpa LNG SPA signed earlier this month. This
additional purchase of 0.75 mtpa will be used by Endesa’s parent
firm Enel.
The Corpus Christi, TX-based LNG export facility is expected to
produce 13.5 mtpa of LNG and has permits for three trains. With
these contracts, Cheniere has secured SPAs for its first LNG train,
and looks toward securing additional contracts for the
facility. Under this SPA, Endesa would buy the produce at a
price indexed to the monthly Henry Hub price, in addition to a
fixed price, on a Free on Board basis.
The company expects to reach a final investment decision and
commence construction of the facility in 2015. First commercial
delivery from the facility under this 20-year agreement is expected
in 2018. The SPA also has a 10-year extension option.
Located in Houston, Texas, Cheniere Energy is mainly involved in
operations related to liquefied natural gas. The company is the
owner and operator of western Cameron Parish, LA-based Sabine Pass
liquefied natural gas terminal. In addition, Cheniere Energy
possesses and operates Louisiana-based Creole Trail Pipeline.
Cheniere Energy holds a Zacks Rank #2 (Buy), indicating that it
will outperform the broader U.S. equity market over the next one to
three months.
In addition to Cheniere, one can consider players from the industry
such as Range Resources Corp. (RRC), World
Point Terminals, LP (WPT) and EOG Resources,
Inc. (EOG). While Range Resources and World Point sport a
Zacks Rank #1 (Strong Buy), EOG holds a Zacks Rank #2.
EOG RES INC (EOG): Free Stock Analysis Report
CHENIERE ENERGY (LNG): Free Stock Analysis Report
RANGE RESOURCES (RRC): Free Stock Analysis Report
WORLD POINT TER (WPT): Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
Cheniere Energy (AMEX:LNG)
Historical Stock Chart
From Mar 2024 to Apr 2024
Cheniere Energy (AMEX:LNG)
Historical Stock Chart
From Apr 2023 to Apr 2024