Exhibit 99.2

 

 

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Cheniere Energy, Inc.

 

Corporate Presentation

 

November 2004

 

[LOGO]

 



 

Safe Harbor Act

 

Safe Harbor Act Statement Under the Private Securities Litigation Reform Act of 1995: Certain information in this presentation are forward looking statements that are based on management’s belief, as well as assumptions made by, and information currently available to management. While the company believes that its expectations are based upon reasonable assumptions, there can be no assurances that the company’s financial goals will be realized. Numerous uncertainties and risk factors may affect the company’s actual results and may cause results to differ materially from those expressed in forward-looking statements made by or on behalf of the company. These uncertainties and risk factors include political, economic, environmental and geological issues, including but not limited to, the continued need for additional capital, the competition within the oil and gas industry, the price of oil and gas, currency fluctuations, and other risks detailed from time to time in the company’s periodic reports filed with the United States Securities and Exchange Commission.

 

[LOGO]

 

2



 

Production vs Consumption (Tcf)

 

[CHART]

 

Cheniere estimate based on 2% annual average decline in production, 1% annual average growth in consumption post-2008

 

3



 

Domestic Production

 

US Lower 48 Dry Gas Production Forecast

 

[CHART]

 

Source: IHS Energy

 

4



 

Supplies Ample
LNG capacity by region in 2010

 

[GRAPHIC]

 

                  Committed Liquefaction Investment $20 Billion by 2010

                  80% Controlled by National Oil Companies

 

Current LNG Consumption

Asia – 11 Bcf/d

Europe – 4 Bcf/d

Americas –2 Bcf/d

 

Liquefaction Growth

 

[CHART]

 

Source: GIIGNL, Cheniere Research

 

5



 

Shipping

 

Committed Shipping Investment over $13 Billion by 2008

Increasing number of ships uncommitted to a trade

 

World Fleet*

 

1995

 

93

 

2001

 

128

 

2003

 

152

 

2008

 

244

+

 

[GRAPHIC]

 


Source: *Poten & Partners July 2004

 

6



 

Status of Industry

 

In the next three years:

 

                  Liquefaction growth of 10 Bcf/d represents 60% increase over next 3 years

                  Shipping growth of 92 vessels represents 60% increase over next 3 years

                  The supply - demand gap in the US continues to make this market the prime target for LNG producers

                  14 - -18 Bcf/d potential for LNG imports

                  Bottleneck: US Receiving capacity

 

7



 

US LNG Import Facilities

 

[GRAPHIC]

 

Source: Cheniere Research

 

8



 

Coastal States Gas Consumption

 

2002

 

[GRAPHIC]

 

Top 5 Coastal Consumers

TX, CA, LA, NY, FLA

Source: EIA, NG Monthly, April 2004

 

9



 

US Gas Flows - 2001

 

[GRAPHIC]

 

Capacity

(Million Cubic Feet per Day)

 

[GRAPHIC]

 

Source: EIA

 

10



 

US Regasification Capacity

2010

 

[GRAPHIC]

 

11



 

Cheniere LNG Sites

 

[GRAPHIC]

 

•  Optionality

•  Flexibility

•  Reliability

•  Liquidity

•  Low Cost

 

12



 

Facility Overview

 

 

 

Freeport LNG L.P.
30%

 

Sabine Pass LNG L.P.
100%

 

Corpus Christi LNG L.P.
66.7%

 

Capex*

 

$650 - $750 million

 

$750 - $850 million

 

$650 - $750 million

 

Initial Capacity

 

1.5 Bcf/d

 

2.6 Bcf/d

 

2.6 Bcf/d

 

Storage Capacity

 

6.7 Bcfe

 

10.1 Bcfe

 

10.1 Bcfe

 

Loading Berths

 

1 dock

 

2 docks

 

2 docks

 

Storage Tanks

 

2 tanks

 

3 tanks

 

3 tanks

 

Land

 

233 acres

 

568 acres

 

610 acres

 

FERC Permit

 

June 2004

 

Expected Q4 2004

 

Expected Q2 2005

 

Groundbreaking

 

Q1 2005

 

Q1 2005

 

Q3 2005

 

 


*Estimated construction costs before financing costs

 

13



 

Marketing of Capacity

 

Total capacity in development

6.7 Bcf/d

 

 

Freeport – Sold Out

 

1.5 Bcf/d

 

DowChemical

 

0.5 Bcf/d

 

ConocoPhillips

 

1.0 Bcf/d

 

 

 

 

 

Sabine Pass – Sold Out

 

2.6 Bcf/d

 

Total

 

1.0 Bcf/d

 

ChevronTexaco*

 

1.0 Bcf/d

 

Held to Cheniere Account

 

0.6 Bcf/d

 

 

 

 

 

Corpus Christi

 

2.6 Bcf/d

 

Available

 

1.5 Bcf/d

 

Held to Cheniere Account

 

1.1 Bcf/d

 

 


*Under Option

 

14



 

Low Risk Base Business

 

                  Provider of service for fees (no gas risk)

                  Conventional, proved technology

                  Anchor customer strategy

                  Large customers – 500 MMcf/d - 1 Bcf/d each

                  A rated credit or better

                  Long term commitments – 20 years or more – take or pay

                  Covers facility costs, debt service, and moderate equity return

 

15



 

Service Provider Model Economics

 

Freeport LNG, L.P – Cheniere 30% Limited Partner

                  Capacity: 1.5 Bcf/d

                  CAPEX: Estimate $650 - $750 million Financed by ConocoPhillips

                  ConocoPhillips – terminal usage fee sufficient to recover financing and pro-rata costs; plus throughput fee $0.05/Mcf on 1 Bcf/d

                  Dow Chemical - Long-term capacity fee

 

Sabine Pass LNG L.P.

                  Capacity: 2.6 Bcf/d each

                  CAPEX: Estimate $750 - $850 million

                  ChevronTexaco and Total - 2 Bcf/d @ $0.32/MMbtu

                  Project Financing $741 million debt through HSBC & Société Générale

                  Project Equity ChevronTexaco negotiating $200 million for 20% interest

 

Corpus Christi LNG L.P. – will use Sabine Pass model

 

16



 

Cheniere’s Competitive Advantage

 

      Low cost supplier of LNG regas capacity

                  Gulf Coast provides highest market optionality

                  Early mover = best sites

                  Gulf Coast allows large capacity terminals = low unit cost

                  Large sites allow use of existing technology = low capital cost

 

      Low execution risk

                  Conventional proven technology

                  Anchor contracts for 40 – 60% of capacity

                  Strong public support

 

      Excellent growth potential

                  Flexible use of additional capacity

                  Expansion potential

                  Future value chain integration

 

17



 

Immediate Goals

 

                  Break ground at Freeport

                  Finalize Sabine Pass construction turnkey

                  Permit for Sabine Pass

                  Close financings for Sabine Pass

                  Break ground at Sabine Pass

                  Sell 1 to 1.5 Bcf/d of capacity at Corpus

                  Permit for Corpus

 

18