Cheniere Q2 Revenue Halves As LNG Prices Slump

Cheniere Energy (NYSEAMERICAN: LNG) reported higher-than-expected net income for the second quarter of 2023, but its revenues halved from last year amid lower international LNG prices.

Cheniere’s net income jumped by 85% year-on-year to $1.369 billion, but revenue plunged by 49% to $4.1 billion in the second quarter, the biggest U.S. LNG exporter said on Thursday.

Cheniere shipped 149 LNG cargoes in the second quarter of 2023, down from 156 cargoes for the same period last year, as LNG volumes fell by 5% year over year.

During the three months ended June 30, 2023, Cheniere’s subsidiaries signed new long-term contracts representing a total of up to around 76 million tonnes of LNG with expected deliveries between 2026 and 2049.

Long-term supply deals are back in vogue as Europe and China are in an intensifying competition to sign long-term supply deals with U.S. LNG developers and exporters.

“Our team achieved several key milestones on construction and development across our growth projects at both sites, as well as building significant commercial momentum, all of which supports the continued growth of our market-leading LNG platform and further evidences the long-term role of our reliable, cleaner-burning LNG in the global energy mix,” Jack Fusco, Cheniere’s President and CEO, said.

Last year, Cheniere more than doubled its revenues from a year earlier as Europe imported increased volumes and paid high prices for liquefied natural gas as it sought to replace Russian pipeline supply. Europe attracted most of the U.S. exports of LNG last year as demand in Asia was weak while the EU raced to fill inventories ahead of the 2022/2023 winter. Cheniere, as the top U.S. LNG exporter, benefited from the European rush to buy LNG.

For the first quarter of 2023, Cheniere exported a record number of 167 LNG cargoes exported and reported a record net income of $5.4 billion, thanks to gains from the use of commodity derivative instruments. 

By Tsvetana Paraskova for Oilprice.com

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