xxreno, LNG -- Is that report something you can give a link to or email to que for Oilviews? Great to see all this discussion about this new area of interest for me.
Since LNG has been working for about the past 30 years or so it would seem that all a your questions have been resolved favorably.
I just bought back a lotta my position in Cheniere Energy (LNG) today, on their announcement of an agreement with Dow Chemical to take a third of the Freeport terminal's capacity. This represents a watershed event for Cheniere since its the first time a potential customer agreed to anything with them. Up until now all they did was pay some consultants and line up some partners. I'm beginning to think these guys are for real. See PR below:
Freeport LNG Development LP Signs Agreement With Dow Chemical For Capacity Use of 500 Million Cubic Feet Per Day of Natural Gas
Friday June 20, 7:01 am ET
HOUSTON--(BUSINESS WIRE)--June 20, 2003--Cheniere Energy, Inc. (AMEX: LNG - News) announced today that Freeport LNG Development, L.P. (Freeport LNG), in which Cheniere holds a 30 percent limited partnership interest, signed an agreement with The Dow Chemical Company (NYSE: DOW - News) for the potential long-term use of its regas facility on Quintana Island, Texas. Under the agreement Dow will have the processing rights to 3.6 million tons per year (500 million cubic feet per day) beginning in 2007. The agreement is subject to the parties concluding a definitive terminal use agreement. Pursuant to the Freeport LNG partnership agreement, an advance payment by Dow to Freeport LNG will cause Freeport LNG to accelerate its payments to Cheniere totaling $1,250,000 originally scheduled for July and October 2003.
In February 2003, Cheniere sold 60% of its Freeport project to Freeport LNG Investments, LLC, a company controlled by Michael S. Smith, in exchange for $5,000,000 payable over time and a commitment to contribute $9,000,000 for development costs of the project. Cheniere also sold 10% of Freeport LNG to Contango Oil & Gas Company (AMEX: MCF - News) for $2,333,000.
In March 2003, Freeport LNG submitted an application with the Federal Energy Regulatory Commission (FERC) for the construction of a terminal designed for 1.5 billion cubic feet per day (Bcf/d) of regassification capacity on Quintana Island in Freeport, Texas.
Charif Souki, CEO of Cheniere said, "In the last few months we have experienced a strong level of interest in all three of our facilities - Freeport, Sabine Pass and Corpus Christi. Currently Freeport is the only facility offering capacity for sale, and this agreement represents one third of its capacity. We are beginning to see a trend where gas users in the US are no longer satisfied to depend on traditional suppliers for their gas needs and are beginning to take matters into their own hands. This was first evidenced by Sherwin Alumina electing to participate in the equity of our Corpus Christi facility, and now, by Dow electing to secure its own capacity in Freeport. We have received several inquiries from other industrials and power generators all seeking to secure long-term gas supplies. This marks a departure from the traditional model where owners of stranded gas around the globe were looking for outlets into the vast US market.
Cheniere's interest in three terminals on the Gulf Coast with a total capacity over 6 Bcf/d will allow gas users to diversify their supply sources and offer suppliers the opportunity to access the US market.
More than ever, we think it is critical to move expeditiously. We expect to file applications with FERC for Sabine Pass and Corpus Christi in January 2004 and to have all three terminals operational in 2007."
Cheniere Energy, Inc. is a Houston-based Gulf of Mexico E&P company and a developer of Liquefied Natural Gas (LNG) receiving terminals. Cheniere conducts exploration in the Gulf using a regional database of 7,000 square miles of PSTM 3D seismic data. Cheniere owns 9% of Gryphon Exploration Company, along with Warburg, Pincus Equity Partners, L.P., who owns 91% after an investment of $85,000,000. Gryphon conducts exploration in the Gulf using a regional database of 20,000 square miles of PSTM 3D seismic data. Cheniere is a 30% limited partner in Freeport LNG Development, L.P., which is developing an LNG receiving terminal in Freeport, TX. Cheniere is also developing two additional LNG receiving terminals along the Gulf Coast with locations in Corpus Christi, TX, and Sabine Pass, LA.
Additional information on the company may be found on its website at www.cheniere.com, by contacting the company's investor and media relations department toll-free at (888) 948-2036 or by writing to: LNG@MDCGroup.com. |
