On May 4, Cheniere crushed analysts’ expectations with a huge first quarter earnings report. It reported $2.2 billion in revenues, all from shipping 67 liquefied natural gas cargoes from its terminal in Sabine Pass, Louisiana. That is about seven times the company’s revenues from the first quarter of 2017, and analysts had expected about $1.7 billion in revenues in the first quarter of 2018. The earnings surprise sent Cheniere’s stock soaring.
Cheniere is continuing to expand its Sabine Pass terminal, while it invests in a new terminal at Corpus Christi, Texas. It sees demand continuing to grow, especially to China. Part of the success was driven by the fact that prices for LNG are also 20% to 40% higher than last year. By 2020, Cheniere is expected to be the second largest LNG seller in the world. It will still be far behind Qatar Petroleum, the longtime king of LNG, but Cheniere is expected to inch out other major players from countries like Australia, Malaysia, and Algeria.
Cheniere is the unquestioned American LNG leader right now, but many other companies are racing to catch up. Exports are expected to be an important source of demand for U.S. producers in the future. Most export terminals will be located in Texas and Louisiana, but producers in Pennsylvania, Ohio, and West Virginia will be among those increasing production to offset the gas sold overseas. If you want to explore acquiring land for production in the Marcellus and Utica shale formations, just contact us at (412) 212-7517.