As Cheniere Energy moves ahead with construction of a pipeline carrying natural gas out of Oklahoma’s STACK and SCOOP plays, the Houston company announced Monday plans for a framework that prioritizes reinvestment of cash flows to grow the company’s LNG platform.
The plan was approved by the Board of Directors and the company expects to generate more than $9 billion of available cash through the first half of 2024. Cheniere expects growth as a result of reinvesting cash flows using at least 50% equity funding on its Sabine Pass Train 6 and Corpus Christi Stage 3 projects.
The plan also includes a 3-year, $1 billion share repurchase effort.
“The capital allocation framework we announced today prioritizes continued investment in our LNG platform through new high-return growth projects, beginning with Sabine Pass Train 6, on which we have made a positive FID and have issued full notice to proceed to Bechtel,” said Jack Fusco, Cheniere’s President and Chief Executive Officer. “The market-leading execution we have achieved across our world-class LNG platform has provided stable and growing cash flow, which forms the foundation for this capital allocation framework, and we remain committed to delivering long-term shareholder value through growth.”
Cheniere also has finalized funding for the Train 6 of the Sabine Pass Liquefaction Project in Cameron Parish, Louisiana. The company entered into 5-year $1.5 billion senior secured credit facilities with 29 banks and financial institutions. The facilities include a $750 million delayed draw term loan and a $750 million revolving credit facilities.
Cheniere also announced that its subsidiary, Cheniere Corpus Christi Liquefaction Stage III, LLC enterd into a 15-year gas supply agreement with Apache Corporation. Apache agreed to sell 140,000 MMBtu a day of natural gas.
Cheniere is in the process of completing a natural gas pipeline from Kingfisher County, Oklahoma south to Texas. The 200-mile Midship pipeline is a $1 billion project.