CQP to Fund Liquefaction Project - Analyst Blog


Cheniere Energy Partners LP ( CQP ) - a subsidiary of energy company Cheniere Energy Inc. ( LNG ) - recently took the final investment decision for Sabine Pass Liquefaction project. Located adjacent to the Sabine Pass Liquefied Natural Gas terminal, the project includes development and building of trains 3 and 4.

The board of directors of CQP had issued a notice to Bechtel Oil, Gas and Chemicals Inc. to start the construction work for trains 3 and 4. Sabine Pass Liquefaction LLC, a wholly owned affiliate of CQP also closed credit facilities totaling $5.9 billion, together with a Term Loan A credit facility of $4.4 billion. These credit facilities fulfill the fund requirement for the start-up and development of the first four liquefaction trains of the project.

Construction work on trains 1 and 2 started last August and is about 30% complete. The first LNG is likely to be delivered by late 2015.

Simultaneously, CQP also concluded the purchase of the Creole Trail pipeline from another subsidiary of Cheniere Energy Inc. The pipeline is 94 miles long and will be used by the Liquefaction project to source domestic natural gas for Liquefied Natural Gas processing.

CQP is the owner and the operator of the Sabine Pass Liquefied Natural Gas terminal through its wholly owned affiliate. The LNG terminal spreads over 1,000 acres of land and is based in western Cameron Parish, La.

The partnership currently retains a Zacks Rank #3 (Hold), implying that it is expected to perform in line with the broader U.S. equity market over the next 1 to 3 months.

Meanwhile, investors can consider other energy production/pipeline entities like EQT Midstream Partners LP ( EQM ) and Oiltanking Partners LP ( OILT ) as attractive investments. Both these firms sport a Zacks Rank #1 (Strong Buy).


EQT MIDSTRM PTR (EQM): Free Stock Analysis Report

CHENIERE ENERGY (LNG): Free Stock Analysis Report

OILTANKING PTNR (OILT): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

This article appears in: Investing , Business , Stocks

Referenced Stocks: CQP , EQM , LNG , OILT

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