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Form 8-K Cheniere Energy Partners For: Oct 30

October 30, 2014 5:19 PM EDT



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): October�30, 2014
Commission File No.�001-33366
����
CHENIERE ENERGY PARTNERS, L.P.
(Exact name of registrant as specified in its charter)

Delaware
20-5913059
(State or other jurisdiction of incorporation or organization)
(I.R.S. Employer Identification No.)
700 Milam Street
Suite 800
Houston, Texas
77002
(Address of principal executive offices)
(Zip Code)
Registrant's telephone number, including area code: (713) 375-5000


Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
o
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17�CFR 240.14d-2(b))
o
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17�CFR 240.13e-4(c))














Item 2.02 Results of Operations and Financial Condition.

On October�30, 2014, Cheniere Energy Partners, L.P. (the "Partnership") issued a press release announcing the Partnership's results of operations for the third quarter ended September�30, 2014. The press release is attached hereto as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated by reference herein in its entirety.

The information included in this Item 2.02 of Current Report on Form 8-K, including the attached Exhibit 99.1, shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

Item 9.01 Financial Statements and Exhibits.

d) Exhibits

Exhibit����������������
Number��������Description
99.1*������������Press Release, dated October�30, 2014.
* Furnished herewith.

����





SIGNATURES




Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

CHENIERE ENERGY PARTNERS, L.P.
By:
Cheniere Energy Partners GP, LLC,
its general partner
Date:
October�30, 2014
By:
/s/ Michael J. Wortley
Name:
Michael J. Wortley
Title:
Senior Vice President and
Chief Financial Officer






EXHIBIT INDEX

Exhibit����������������
Number��������Description
99.1*������������Press Release, dated October�30, 2014.
* Furnished herewith.





EXHIBIT 99.1

CHENIERE ENERGY PARTNERS, L.P. NEWS RELEASE
Cheniere Energy Partners, L.P. Reports Third Quarter 2014 Results
Houston, Texas - October 30, 2014 - Cheniere Energy Partners, L.P. (Cheniere Partners) (NYSE MKT: CQP) reported a net loss of $43.2 million and $339.2 million for the three and nine months ended September 30, 2014, compared to a net loss of $98.1 million and $196.9 million for the same periods in 2013, respectively.
Significant items for the three and nine months ended September 30, 2014 were a gain of $3.9 million and a loss of $213.0 million, respectively, compared to losses of $23.8 million and $34.2 million for the comparable 2013 periods, respectively. Significant items for the three and nine months ended September 30, 2014 related to development expenses primarily for the liquefaction facilities we are developing through Sabine Pass Liquefaction, LLC (Sabine Pass Liquefaction) at the Sabine Pass LNG terminal adjacent to the existing regasification facilities (the Liquefaction Project), loss on early extinguishment of debt related to the write-off of debt issuance costs in connection with the early extinguishment in May 2014 of $2.1 billion of the four credit facilities entered into by Sabine Pass Liquefaction in 2013, as compared to the write-off of debt issuance costs in connection with the early extinguishment in April 2013 of $1.4 billion of Sabine Pass Liquefactions 2012 construction/term loan facility, and derivative (gain) loss due primarily to changes in long-term LIBOR during the respective periods.

General and administrative expense (including affiliate) decreased by $18.1 million and $25.9 million for the three and nine months ended September 30, 2014, compared to the corresponding 2013 periods, respectively, primarily due to costs incurred under certain management service agreements with wholly owned subsidiaries of Cheniere Energy, Inc. (Cheniere). Sabine Pass Liquefaction and Cheniere Creole Trail Pipeline, L.P. are required to pay monthly fees to an affiliate of Cheniere based upon the capital expenditures incurred in the previous month for construction of the first four natural gas liquefaction trains (Trains) at the Liquefaction Project, and construction of certain modifications to the Creole Trail Pipeline, which interconnects the Sabine Pass LNG terminal with a number of large interstate pipelines.

Recent Significant Event

In August 2014, Sabine Pass Liquefaction and Cheniere Marketing, LLC (Cheniere Marketing), a wholly owned subsidiary of Cheniere, entered into an amended and restated Sale and Purchase Agreement (SPA) pursuant to which Cheniere Marketing may purchase, at its option, any liquefied natural gas (LNG) produced by Sabine Pass Liquefaction in excess of that required for other customers.

Liquefaction Project Update
We continue to make progress on the Liquefaction Project, which is being developed for up to six Trains, each with an expected nominal production capacity of approximately 4.5 mtpa.
The Trains are in various stages of development.
Construction on Trains 1 and 2 began in August 2012, and as of September�30, 2014, the overall project for Trains 1 and 2 was approximately 76% complete, which is ahead of the contractual schedule. Based on our current construction schedule, we anticipate that Train 1 will produce LNG as early as late 2015.

Construction on Trains 3 and 4 began in May 2013, and as of September�30, 2014, the overall project for Trains 3 and 4 was approximately 43% complete, which is ahead of the contractual schedule. We expect Trains 3 and 4 to become operational in late 2016 and 2017, respectively.

Trains 5 and 6 are under development. We have entered into SPAs for approximately 3.75 mtpa in aggregate that commence with the date of first commercial delivery for Train 5. We have received authorizations from the U.S. Department of Energy (DOE) to export 503 Bcf per year of LNG volumes from Trains 5 and 6 to free trade agreement (FTA) countries. Authorization to export LNG to non-FTA countries is pending. Federal Energy Regulatory Commission (FERC) authorization is also pending. We will contemplate making a final investment





decision to commence construction on Trains 5 and 6 based upon, among other things, entering into acceptable commercial arrangements, receiving all regulatory approvals and obtaining financing.

Liquefaction Project Timeline

Target Date
Milestone
Trains
1 & 2
Trains
3 & 4
Trains
5 & 6
DOE export authorization
Received
Received
Received FTA
Pending Non-FTA
Definitive commercial agreements
Completed 7.7 mtpa
Completed 8.3 mtpa
T5: Completed
T6: 2014/2015
- BG Gulf Coast LNG, LLC
4.2 mtpa
1.3 mtpa
- Gas Natural Fenosa
3.5 mtpa
- KOGAS
3.5 mtpa
- GAIL (India) Ltd.
3.5 mtpa
- Total Gas & Power N.A.
2.0 mtpa
- Centrica plc
1.75 mtpa
EPC contract
Completed
Completed
2014/2015
Financing
2015
- Equity
Completed
Completed�
- Debt commitments
Received
�Received
FERC authorization
- FERC Order
Received
Received
2014/2015
- Certificate to commence construction
Received
Received
Issue Notice to Proceed
Completed
Completed
2015
Commence operations
2015/2016
2016/2017
2018/2019
Distributions to Unitholders
We estimate that the annualized distribution to common unitholders for fiscal year 2014 will be $1.70 per unit.
We will pay a cash distribution per common unit of $0.425 to unitholders of record as of November 3, 2014, and the related general partner distribution on November 14, 2014.

Cheniere Partners owns 100 percent of the Sabine Pass LNG terminal located on the Sabine Pass deep water shipping channel less than four miles from the Gulf Coast. The Sabine Pass LNG terminal includes existing infrastructure of five LNG storage tanks with capacity of approximately 16.9 billion cubic feet equivalent (Bcfe), two docks that can accommodate vessels with capacity of up to 265,000 cubic meters and vaporizers with regasification capacity of approximately 4.0 Bcf/d.
Cheniere Partners is developing natural gas liquefaction facilities at the Sabine Pass LNG terminal adjacent to the existing regasification facilities. Cheniere Partners plans to construct over time up to six natural gas Trains, which are in various stages of development. Each Train is expected to have a nominal production capacity of approximately 4.5 mtpa. The overall project completion of Trains 1 and 2 is approximately 76% as of September�30, 2014. The overall project completion of Trains 3 and 4 is approximately 43% as of September�30, 2014. Sabine Pass Liquefaction recently began the development of Trains 5 and 6 and commenced the regulatory process in February 2013. Sabine Pass Liquefaction has entered into six third-party LNG SPAs that in the aggregate equate to 19.75 mtpa and commence with the date of first commercial delivery of Trains 1 through 5 as specified in the respective SPAs. Cheniere Partners has placed documentation pertaining to the Liquefaction Project, including the applications and supporting studies, on its website located at http://www.cheniere.com.

For additional information, please refer to the Cheniere Energy Partners, L.P. website at www.cheniere.com and Quarterly Report on Form 10-Q for the quarter ended September�30, 2014, filed with the Securities and Exchange Commission.
This press release contains certain statements that may include forward-looking statements. All statements, other than statements of historical facts, included herein are forward-looking statements. Included among forward-looking statements are, among other things, (i) statements regarding Cheniere Partners business strategy, plans and objectives, including the construction and operation of liquefaction facilities, (ii) statements regarding expectations regarding regulatory authorizations and approvals, (iii) statements expressing beliefs and expectations regarding the development of Cheniere Partners LNG terminal and liquefaction business, (iv) statements regarding the business operations and prospects of





third parties, (v) statements regarding potential financing arrangements, and (vi) statements regarding future discussions and entry into contracts. Although Cheniere Partners believes that the expectations reflected in these forward-looking statements are reasonable, they do involve assumptions, risks and uncertainties, and these expectations may prove to be incorrect. Cheniere Partners actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including those discussed in Cheniere Partners periodic reports that are filed with and available from the Securities and Exchange Commission. You should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Other than as required under the securities laws, Cheniere Partners does not assume a duty to update these forward-looking statements.

(Financial Table Follows)






Cheniere Energy Partners, L.P.
Selected Financial Information
(in thousands, except per unit data) (1)
(unaudited)

Three Months Ended
Nine Months Ended
September 30,
September 30,
2014
2013
2014
2013
Revenues
Revenues
$
66,890

$
66,646

$
199,933

$
199,052

Revenuesaffiliate
700

800

2,206

2,140

Total revenues
67,590

67,446

202,139

201,192

Operating costs and expenses


Operating and maintenance expense
21,235

23,553

54,686

52,751

Operating and maintenance expenseaffiliate
5,016

6,314

14,307

23,534

Depreciation expense
14,781

14,491

43,821

43,150

Development expense
1,383

1,355

8,671

8,157

Development expenseaffiliate
329

133

723

1,195

General and administrative expense
2,448

2,718

10,048

8,521

General and administrative expenseaffiliate
24,454

42,239

74,579

101,998

Total operating costs and expenses
69,646

90,803

206,835

239,306

Loss from operations
(2,056
)
(23,357
)
(4,696
)
(38,114
)
Other income (expense)


Interest expense, net
(46,884
)
(52,528
)
(130,943
)
(134,806
)
Loss on early extinguishment of debt




(114,335
)
(80,510
)
Derivative gain (loss), net
5,573

(22,335
)
(89,286
)
55,706

Other income
127

111

63

873

Total other expense
(41,184
)
(74,752
)
(334,501
)
(158,737
)
Net loss
$
(43,240
)
$
(98,109
)
$
(339,197
)
$
(196,851
)
Net income (loss) attributable to the Creole Trail Pipeline Business


244



(18,150
)
Net loss attributable to partners
$
(43,240
)
$
(98,353
)
$
(339,197
)
$
(178,701
)
Basic and diluted net income (loss) per common unit
$
0.08

$
(0.20
)
$
(0.83
)
$
(0.01
)
Weighted average number of common units outstanding used for basic and diluted net income (loss) per common unit calculation
57,079

57,079

57,079

53,277








September 30, 2014
December 31, 2013
Cash and cash equivalents
$
252,648

$
351,032

Restricted cash and cash equivalents
393,276

227,652

Accounts receivable
19,669

40

LNG inventory
13,239

10,430

Other current assets (2)
24,128

23,974

Non-current restricted cash and cash equivalents
1,132,759

1,025,056

Property, plant and equipment, net
8,463,022

6,383,939

Debt issuance costs, net
251,101

313,944

Non-current derivative assets
32,161

98,123

Other assets
91,139

82,593

Total assets
$
10,673,142

$
8,516,783

Current liabilities (2)
408,337

265,887

Long-term debt, net
8,989,760

6,576,273

Deferred revenue
14,500

17,500

Other liabilities (2)
34,234

17,379

Total partners capital
1,226,311

1,639,744

Total liabilities and partners capital
$
10,673,142

$
8,516,783

(1)
Please refer to the Cheniere Energy Partners, L.P. Quarterly Report on Form 10-Q for the quarter ended September�30, 2014, filed with the Securities and Exchange Commission.
(2)
Amounts include transactions between Cheniere Energy Partners, L.P. and Cheniere Energy, Inc. or subsidiaries of Cheniere Energy, Inc.



CONTACTS:
Investors: Randy Bhatia: 713-375-5479 Christina Burke: 713-375-5104
Media: Faith Parker: 713-375-5663






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