What is Cheniere Energy $LNG?
Cheniere Energy is an energy company that operates in the liquefied natural gas (LNG) industry. It is the leader US LNG exporter thanks to its 2 terminals, Sabine Pass (30MTPA) and Corpus Christi (15MTPA) both located in the Gulf of Mexico.
Its business model relies on long term contracts (10-20 years) with energy companies for a fixed amount of LNG per year. The usual structure of the contracts is based on a fee of $2.5/MMBtu + 115% natural gas price at Henry Hub (spot price).
Additionally, Cheniere launched its Marketing division in 2019. This division does not have long-term contracts with clients. Otherwise, it rents vessels and use them to deliver LNG directly to the customer terminals taking advantage of spot prices.
The structure of Cheniere Energy is a bit complex as it has 100% interest on the Corpus Christi terminal and the marketing division, plus 50.6% interest on Cheniere Energy Partners $CQP which owns 100% of the Sabine Pass Terminal (The rest is owned by Blackstone Group & Brookfield AM).
