Cheniere Energy, Inc. (LNG - Free Report) recently received approval from Federal Energy Regulatory Commission (FERC) to introduce fuel gas for testing Train 1 of its Corpus Christi liquefaction (CCL) project. While the fuel gas will help make the train operational, the company will seek another approval from FERC to introduce feed gas to start the process of gas liquefaction.
Cheniere Energy is likely to commence gas liquefaction at Train 1 in early September and start exporting its first test cargo in December/January. Construction of the Train 1 of its CCL project is entrusted with contractor Bechtel Oil, Gas and Chemicals, Inc. On completion, Bechtel will hand over the train’s custody to Cheniere Energy, which expects the First Train to start long-term operations in the first half of 2019. Cheniere Energy has already entered into long-term contracts with the Indonesian state-owned oil and gas company Pertamina Corporation and Spain-based Endesa S.A. to supply liquified natural gas from Train 1 to these firms for 20 years.
Under the CCL project, Cheniere Energy will develop three trains, each having a nominal production capacity of 4.5 million metric tons per year of LNG. While the first train is likely to come online by the first half of 2019, the second train is expected to be operational within the second half of 2020. In May 2018, the company gave the final investment decision (FID) on Train 3 at its Corpus Christi export terminal in Texas, marking the first FID on a new LNG project in the United States since 2015. The third train is likely to become functional in 2023.
Further, Cheniere Energy intends to develop seven midscale liquefaction trains adjacent to the CCL Project. The company also initiated the regulatory approval process regarding the same. Total production capacity of these trains is expected to be approximately 9.5 Mtpa.
As it is, the company has been exporting LNG from the Sabina Pass since 2016. While four trains under the Sabina Pass project are already functional, train 5 is under construction and likely to begin exporting in the second half of 2019. Train 6 is being commercialized with the necessary regulatory approvals.
Being the first company to receive Federal Energy Regulatory Commission’s (FERC) approval to export LNG from its 2.6 billion cubic feet per day Sabine Pass terminal in Cameron Parish, LA, Cheniere Energy enjoys a distinct competitive advantage.
Zacks Rank & Other Promising Stocks
Cheniere Energy currently sports a Zacks Rank #1 (Strong Buy).
Other top-ranked stocks in the energy space include Bonanza Creek Energy, Inc. (BCEI - Free Report) , Eclipse Resources Corporation (ECR - Free Report) and Geopark Ltd. (GPRK - Free Report) , each sporting a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Bonanza Creek delivered an average positive earnings surprise of 215.36% in the last four quarters.
Eclipse Resources delivered an average positive earnings surprise of 133.33% in the trailing four quarters.
Geopark’s 2018 earnings are expected to grow 745.52% year over year.
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