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Cheniere Energy, Inc. Message Board

  • pdb3838 pdb3838 Sep 12, 2012 10:44 AM Flag


    Has anyone noticed that in the Total agreement, the company mentioned for the first time a potential 5th train. At least this is the first time that I notied this possibility Certainly that is a positive and because of economies of scale, I think this is better than the possibility of opening another facility in Texas for which the company filed a permanent. With respect to the Total agreement, it looks like the company will get a free ride on using the Total facility immediately and for the first trains and only begin paying for the service to a tune of $2.5 million a month after the 3rd train begins commercial operation and will forego the fees Total is now paying for its facilities at Sabine in total after the 5th train becomes commercially operational. Sounds like a good deal for LNG. I especilly like the 5th train idea which might be up and operational shortly after the 4 other trains and will contribute a whole lot of money to te company. Sounds like a great deal for LNG. Any comments. Now we just have to wait for 2.5 yrs for the first two trains to be operational and start yielding us some big profits. GLTL

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    • The Total agreement doesn't really come as a surprise as was always necessary as both CVX and TOT contractually own a portion of the storage and other facilities at the import terminal. I suspect there is a CVX agreement in the works as well, but might not be as necessary given the TOT deal.

      As far as I am aware, the DoE approval only covers 4 trains. For 5th train, they have to get in queue with everybody else. One of the beliefs floating around out there right now in the industry is that the DoE will approve additional terminals next year but with a cap of 6 bcf/d. It just so happens that the 4 most advanced terminals (i.e. those which are basically fully contracted out) add up to approximately 6 bcf/d - Sabine Pass, Cameron, Freeport, Cove Point.

      In other words, too early to say what the potential for a 5th train looks like.

      • 4 Replies to sism238
      • The DOE permit is for 16 mtpa, which is close to the capacity for the four trains. However, Korea now has a free trade agreement with the US, and could make a home for the fifth train without an additional approval. Notice how kogas just sold a bunch of their contract capacity, which may mean more is brewing.

        Nonetheless we will know when cheniere signs another contract.

      • You are right re the permitting of the 5th train. But my assumption, under either Obama and Romney, is given the environmental approvals and permits given for the 4 trains, the 5h train will be pro forma and will go to the top of the que given that it has already passed environmental review, all permits and the 5th train will be simply an add on rather than new facility. At least I assume that it will be a pro forma approval,jumping to the head of the line due to the above.

        Again, can anyone solve my idiocy and emplain where the term train came from and what it means.Thanks.


      • recent options activity tells me your full of it.... but we wiil see I do know that Obama is full of it.... geez talk about sacrificial lambs

      • do you really think Obama will have any say anymore after today? He won't defend American Soil with a fist! end of story.

    • Lots of potential here with the fifth train! share price is looking up at 17s and lots of future call option plays being initiated. BUT the real Boom gets set in stone when Cheniere does a couple of things.

      1. Sign a new contract for 85% capacity of Fifth Train with more aggresive arbitrage.
      2. Sign safe purchase agreements with desperate Drillers that increases arbitrage over the current HH pricing.

      btw all bets off if Sierra club goes militant and sabotages Sabine Pass

      • 1 Reply to purplespyderman
      • Agree totally with our first point and given the demand out there in Asia and with the Panama canal shortening transportation time, Sabine Pass when it gets up and running will be a gold mine.

        However, must disagree with your second point re the Sierra Club. I cannot believe even the Sierra club could get traction with a facility that is already operating and in a state and area friendly to the energy industry and not the Environment. I could see them making a point in a pristine area or where things might be harmed. But essentially,this plant already wentthrogh its environmental difficulties and the export industry will only switch direction. Instead of importing gas and shipping it out to the States. Sabine now will ship in the gas over the same pipe lines,just different direction and will export the gas instead of inporting it. So it is essentially the same environmental situation. And Sabine has already got all its permits. Obama has approved it, the only export facility to date, and Romney will be even more favorable. This is not likethe Dominion Power LNG facility where, for some unknown stupidy, it gave the Sierra club veto authority over any change in its usage and the Sierra club utilized the veto. surprise. But totally differnet can of worms. I don't see any problems other than a steep drop in demand abroad which is not likely or difficuty with financing. Just amount of waiting till payday.I'm adding to my shares now.

    • hgtacvs11 Sep 12, 2012 12:15 PM Flag

      Buy more NOW before going any higher. This baby in time will fly!!!

      Sentiment: Strong Buy

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