FORM 4
Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP OF SECURITIES

Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934 or Section 30(h) of the Investment Company Act of 1940
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(Print or Type Responses)
1. Name and Address of Reporting Person *
WILLIAMS WALTER L
   2. Issuer Name and Ticker or Trading Symbol
CHENIERE ENERGY INC [LNG] 		5. Relationship of Reporting Person(s) to Issuer
(Check all applicable)
__X__ Director _____ 10% Owner
__X__ Officer (give title below) _____ Other (specify below)
Vice Chairman
(Last)
(First)
(Middle)
717 TEXAS AVENUE, SUITE 3100		 3. Date of Earliest Transaction (Month/Day/Year)
09/17/2004
(Street)

HOUSTON, TX 77002		 4. If Amendment, Date Original Filed(Month/Day/Year)
 6. Individual or Joint/Group Filing(Check Applicable Line)
_X_ Form filed by One Reporting Person
___ Form filed by More than One Reporting Person
(City)
(State)
(Zip)
Table I - Non-Derivative Securities Acquired, Disposed of, or Beneficially Owned
1.Title of Security
(Instr. 3)		 2. Transaction Date (Month/Day/Year) 2A. Deemed Execution Date, if any (Month/Day/Year) 3. Transaction Code
(Instr. 8)		 4. Securities Acquired (A) or Disposed of (D)
(Instr. 3, 4 and 5)		 5. Amount of Securities Beneficially Owned Following Reported Transaction(s)
(Instr. 3 and 4)		 6. Ownership Form: Direct (D) or Indirect (I)
(Instr. 4)		 7. Nature of Indirect Beneficial Ownership
(Instr. 4)
Code V Amount (A) or (D) Price
Common Stock 09/17/2004   M   75,000 A $ 6 224,333 D  

Reminder: Report on a separate line for each class of securities beneficially owned directly or indirectly.
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Table II - Derivative Securities Acquired, Disposed of, or Beneficially Owned
(e.g., puts, calls, warrants, options, convertible securities)
1. Title of Derivative Security
(Instr. 3)		 2. Conversion or Exercise Price of Derivative Security 3. Transaction Date (Month/Day/Year) 3A. Deemed Execution Date, if any (Month/Day/Year) 4. Transaction Code
(Instr. 8)		 5. Number of Derivative Securities Acquired (A) or Disposed of (D)
(Instr. 3, 4, and 5)		 6. Date Exercisable and Expiration Date
(Month/Day/Year)		 7. Title and Amount of Underlying Securities
(Instr. 3 and 4)		 8. Price of Derivative Security
(Instr. 5)		 9. Number of Derivative Securities Beneficially Owned Following Reported Transaction(s)
(Instr. 4)		 10. Ownership Form of Derivative Security: Direct (D) or Indirect (I)
(Instr. 4)		 11. Nature of Indirect Beneficial Ownership
(Instr. 4)
Code V (A) (D) Date Exercisable Expiration Date Title Amount or Number of Shares
Stock Option $ 6 09/17/2004   M     37,500   (1) 10/01/2004 Common Stock 37,500 $ 0 0 D  
Stock Option $ 6 09/17/2004   M     12,500   (2) 10/01/2004 Common Stock 12,500 $ 0 0 D  
Stock Option $ 6 09/17/2004   M     12,500   (3) 10/01/2004 Common Stock 12,500 $ 0 0 D  
Stock Option $ 6 09/17/2004   M     12,500   (4) 10/01/2004 Common Stock 12,500 $ 0 0 D  

Reporting Owners

Reporting Owner Name / Address Relationships
 Director  10% Owner  Officer  Other
WILLIAMS WALTER L
717 TEXAS AVENUE
SUITE 3100
HOUSTON, TX 77002		   X     Vice Chairman  

Signatures

 Walter L. Williams   10/18/2004
**Signature of Reporting Person Date

Explanation of Responses:

* If the form is filed by more than one reporting person, see Instruction 4(b)(v).
** Intentional misstatements or omissions of facts constitute Federal Criminal Violations. See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).
(1) 9,375 options were exercisable on each of June 1, 1997, 1998, 1999 and 2000.
(2) 3,125 options were exercisable on each of December 15, 1998, 1999, 2000 and 2001.
(3) 3,125 options were exercisable on each of March 18,2000, 2001, 2002 and 2003.
(4) 3,125 options were exercisable on each of July 1, 2000, 2001, 2002 and 2003.

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