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Cheniere (LNG) Pulls Off Completion of Train 3 in CCL Project

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Zacks Equity Research
·3 min read
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Cheniere Energy, Inc. LNG recently attained the substantial completion of its third liquefaction train at its Corpus Christi liquefied natural gas export plant in Texas. The company's EPC affiliate Bechtel Oil, Gas and Chemicals, Inc. handed over the reins, custody and control of Train 3 to it post commissioning.

Cheniere along with its subsidiaries and Bechtel announced substantial closure of all eight liquefaction trains at the Corpus Christi liquefaction project (CCL) alongside the Sabine Pass liquefaction project, ahead of schedule and within budget.

With the extensive completion, the quarterly performance of LNG revenues from Train 3 will be recorded in Cheniere's and its applicable affiliates' statements of operations going forward.

On the arrival of the new train, Cheniere’s CCL Project now has three trains functioning.The Train 3 with acapacity to produce 0.66 billion cubic feet per day (bcfd) of natural gas has been running for months in test mode. As more units under construction come online, the U.S. LNG export potential is projected to increase to 11.9 bcfd in 2022, up from the current level of 10.5 bcfd.

Train 3 with a capacity of 5 million tonnes per annum (Mtpa) was sanctioned in 2018 by Cheniere. In 2019, the company expected the train to enter service in the first half of 2021 but in the last reported quarter, it preponed its timeline to complete the third train by the first quarter of 2021 itself.

Apart from the Corpus Christi Project, Cheniere’s Sabine Pass is North America’s first large-scale liquefied gas export facility. The company intends to construct up to six trains in all at the Sabine Pass with each train expected to have a capacity worth 4.5 Mtpa. Notably, the run-rate of LNG production is projected within 4.7-5 Mtpa.

While Trains 1 to 5 are active, Train 6 is currently under construction with its completion estimated within the second half of 2022.

Further, Cheniere intends to develop seven midscale liquefaction trains adjacent to the CCL Project. Total production capacities of these trains are expected to be roughly 10 Mtpa.

About the Company

Cheniere is primarily engaged in businesses related to liquefied natural gas (or LNG) through its two business segments, namely LNG terminal, and LNG and natural gas marketing. The company through its controlling interest in Cheniere Energy Partners L.P. CQP owns and operates the Sabine Pass LNG terminal (North America’s first large-scale liquefied gas export facility) in Louisiana.

Zacks Rank & Key Picks

Cheniere currently has a Zacks Rank #3 (Hold). Better-ranked stocks in the energy space includeMatador Resources Company MTDR and Devon Energy Corporation DVN, each presently flaunting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

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