Lower Natural Gas Prices Drag Cheniere’s Revenue Down In Q3

Lower natural gas prices and lower sales sent Cheniere Energy’s (NYSEAMERICAN: LNG) revenue falling by 53% in the third quarter of the year, the top U.S. LNG exporter said on Thursday.

Cheniere’s revenues came in at $4.159 billion for the third quarter, compared to $8.852 billion for the same period of 2022. Revenues for the nine months to September slumped by 36%, to $15.571 billion, from $24.343 billion for the first nine months of 2022. 

Consolidated adjusted EBITDA also fell year-over-year for both the third quarter and the nine months, primarily due to lower total margins per MMBtu of LNG delivered. The decline in margins was driven by lower international gas prices, as well as a higher proportion of volumes sold under long-term contracts and lower total volumes sold into short-term markets, Cheniere said.

“To a lesser extent, the decreases were also driven by lower regasification revenues due to the early termination of one of our terminal use agreements in 2022,” the company added.

“The third quarter was marked by key milestones achieved across the Cheniere platform, highlighted by the production of our 3,000th LNG cargo since start-up in 2016. Cheniere achieved that production milestone faster than any other LNG operator in history, which is further evidence of our dedication to operational excellence,” said Jack Fusco, Cheniere’s President and CEO.

“Persistent volatility in commodity markets continues to reinforce the value of our commercial offering and the stability and visibility of our cash flows, and we are confident in achieving full year 2023 results at the high end of our guidance ranges.”

Looking ahead to next year, Cheniere said that the construction on Corpus Christi Stage 3 continues to progress ahead of plan.

“I am optimistic first LNG production from Train 1 will occur by the end of 2024,” Fusco said.

By Tsvetana Paraskova for Oilprice.com

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