Cheniere Energy Partners Reports Second Quarter 2013 Results

         Cheniere Energy Partners Reports Second Quarter 2013 Results

PR Newswire

HOUSTON, Aug. 2, 2013

HOUSTON, Aug. 2,2013 /PRNewswire/ --Cheniere Energy Partners, L.P.
("Cheniere Partners") (NYSE MKT: CQP) reported a net loss of $47.0 million and
$98.7 million for the three and six months ended June 30, 2013, respectively,
compared to a net loss of $30.4 million and $55.4 million for the same periods
in 2012, respectively.

Results include significant items netting to a gain of $11.1 million and loss
of $10.3 million for the three and six months ended June 30, 2013,
respectively, compared to losses of $15.2 million and $34.0 million for the
three and six months ended June 30, 2012, respectively. Significant items for
the three and six months ended June 30, 2013 related to development expenses
and loss on early extinguishment of debt, which were offset by derivative
gains. Development expenses were primarily for the liquefaction facilities we
are developing at the Sabine Pass LNG terminal adjacent to the existing
regasification facilities (the "Liquefaction Project"). Loss on early
extinguishment of debt was related to Sabine Pass Liquefaction, LLC ("Sabine
Pass Liquefaction") amending and replacing its $3.6 billion credit facility
with four credit facilities aggregating $5.9 billion. Derivative gains were
primarily the result of the change in fair value of Sabine Pass Liquefaction's
interest rate derivatives to hedge the exposure to volatility in a portion of
the floating-rate interest payments under the four credit facilities.

Results for the three and six months ended June 30, 2013 were also impacted by
increases in general and administrative expenses and operating and maintenance
expenses. These increases were partially offset by decreases in development
expense resulting from Trains 1 through 4 of the Liquefaction Project
satisfying the criteria for capitalization. Increases in general and
administrative expenses of $30.5 million and $49.2 million for the three and
six months ended June 30, 2013, respectively, compared to the comparable 2012
periods were primarily due to increased costs incurred to manage the
construction of Trains 1 through 4, which resulted from a management services
agreement entered into by Sabine Pass Liquefaction, in which Sabine Pass
Liquefaction is required to pay a wholly owned subsidiary of Cheniere Energy,
Inc. ("Cheniere Energy") a monthly fee based upon the capital expenditures
incurred in the previous month for the Liquefaction Project. For the three
and six months ended June 30, 2013, the costs incurred to manage the
construction of Trains 1 through 4 were $24.2 million and $37.7 million,
respectively. These payments are being funded from proceeds received from the
Liquefaction Project's equity and debt financings. Increases in operating and
maintenance expenses of $20.5 million and $26.0 million for the three and six
months ended June 30, 2013, respectively, compared to the comparable 2012
periods resulted primarily from costs incurred to purchase LNG to maintain the
cryogenic readiness of the regasification facilities at the Sabine Pass LNG
terminal and increases in variable compensation expenses of $5.3 million and
$7.9 million for the three and six months ended June 30, 2013, respectively,
compared to the comparable 2012 periods.

Overview of Recent Significant Events

  oIn April 2013, Sabine Pass Liquefaction issued $0.5 billion of 5.625%
    Senior Secured Notes due 2021 (the "2021 Sabine Pass Liquefaction Senior
    Notes"), which resulted in an aggregate outstanding principal amount of
    $2.0 billion of the 2021 Sabine Pass Liquefaction Senior Notes. Sabine
    Pass Liquefaction also issued an aggregate principal amount of $1.0
    billion of 5.625% Senior Secured Notes due 2023. The net proceeds from
    these offerings are intended to be used to pay a portion of the capital
    costs incurred in connection with the construction of the Liquefaction
    Project;
  oIn May 2013, Sabine Pass Liquefaction entered into four credit facilities
    totaling $5.9 billion to be used for costs associated with Trains 1
    through 4 of the Liquefaction Project;
  oIn May 2013, Sabine Pass Liquefaction issued a notice to proceed to
    Bechtel Oil, Gas and Chemicals, Inc. ("Bechtel") for the engineering,
    procurement and construction of Trains 3 and 4;
  oIn May 2013, we acquired the Creole Trail Pipeline business for $480.0
    million and reimbursed Cheniere Energy $13.9 million for certain
    expenditures incurred prior to the closing date. Concurrent with the
    Creole Trail Pipeline business acquisition closing, we issued 12.0 million
    Class B units to Cheniere Energy at a price of $15.00 per Class B unit for
    aggregate consideration of $180.0 million pursuant to a unit purchase
    agreement with Cheniere Class B Units Holdings, LLC, a wholly owned
    subsidiary of Cheniere. As a result of the two transactions, we paid
    Cheniere Energy net cash of $313.9 million;
  oIn May 2013, CTPL entered into a $400 million term loan credit facility to
    fund capital expenditures on the Creole Trail Pipeline and for general
    business purposes; and
  oIn May 2013, we entered into an equity distribution agreement with Mizuho
    Securities USA Inc., under which we may sell up to $500.0 million of
    common units through an at-the-market program.

Liquefaction Project Update

We continue to make progress on the Liquefaction Project, which is being
developed for up to six natural gas liquefaction trains ("Trains"), each with
a design production capacity of approximately 4.5 mtpa. We have received all
Federal Energy Regulatory Commission ("FERC") and Department of Energy ("DOE")
approvals for Trains 1 through 4, and we are seeking regulatory authorization
to develop Trains 5 and 6. The Trains are in various stages of development.

  oTrains 1 and 2 construction began in August 2012 and as of June 30, 2013,
    the overall project for Trains 1 and 2 was approximately 38% complete,
    which is ahead of the contracted schedule. Based on our current
    construction, we anticipate that Train 1 will produce LNG as early as late
    2015.
  oTrains 3 and 4 financing was completed in May 2013, and a notice to
    proceed was issued to Bechtel to commence construction of Train 3 and
    Train 4 and the related facilities. We expect Trains 3 and 4 to become
    operational in late 2016 and 2017, respectively.
  oWe continue to progress with the development of Train 5 and Train 6. We
    have completed two sale and purchase agreements ("SPA") for approximately
    3.75 mtpa, in aggregate, of LNG volumes that commence with the start of
    Train 5 operations. Bechtel has begun preliminary engineering on Trains 5
    and 6, and we have commenced the regulatory approval process. In February
    2013, we commenced the National Environmental Policy Act ("NEPA")
    pre-filing process with FERC, and we expect to file the complete
    application with FERC in the second half of 2013. In February 2013 and in
    April 2013, we filed export applications with the DOE for exports to all
    current and future countries with which the U.S. has a Free Trade
    Agreement ("FTA") as well as to any country with which the U.S. does not
    have an FTA in effect for the SPAs with Total Gas & Power North America,
    Inc. ("Total") and Centrica plc ("Centrica"), respectively. In July 2013,
    we received authorization from the DOE to export LNG volumes to FTA
    countries under the Total SPA and Centrica SPA. The non-FTA
    authorizations for the SPAs for Total and Centrica are pending.

Liquefaction Project Timeline

                                Target Date
                                Trains         Trains         Trains
Milestone
                                1 & 2          3 & 4          5 & 6
                                                              T5: Received FTA
DOE export authorization        Received       Received
                                                              Pending Non-FTA
Definitive commercial           Completed 7.7  Completed 8.3  T5: Completed
agreements                      mtpa           mtpa
                                                              T6: 2H13
- 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      2H14
Financing                                                     1H15
- Equity                        Completed      Completed
- Debt commitments              Received       Received
FERC authorization
- FERC Order                    Received       Received       2H14
- Certificate to commence       Received       Received
construction
Issue Notice to Proceed         Completed      Completed      1H15
Commence operations             2015/2016      2016/2017      2018



2013 Distributions

We estimate that the annualized distribution to common unitholders for fiscal
year 2013 will be $1.70 per unit. We will pay a cash distribution per common
unit of $0.425 to unitholders of record as of August 1, 2013, and the related
general partner distribution on August 14, 2013.

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 has regasification facilities that
include existing infrastructure of five LNG storage tanks with capacity of
approximately 16.9 billion cubic feet equivalent (Bcfe), two docks that can
accommodate vessels 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 (the "Liquefaction
Project"). Cheniere Partners plans to construct over time up to six natural
gas liquefaction trains ("Trains", each in sequence, "Train 1", "Train 2",
"Train 3", "Train 4", "Train 5" and "Train 6"), which are in various stages of
development. Each Train is expected to have a design production capacity of
approximately 4.5 mtpa. Cheniere Partners' wholly owned subsidiary, Sabine
Pass Liquefaction, LLC ("Sabine Pass Liquefaction"), has entered into lump sum
turnkey contracts for the engineering, procurement and construction of Train
1, Train 2, Train 3 and Train 4 with Bechtel Oil, Gas and Chemicals, Inc.
("Bechtel"). Sabine Pass Liquefaction has commenced construction of Train 1
and Train 2 and the related new facilities needed to treat, liquefy, store and
export natural gas. Construction of Train 3 and Train 4 and the related
facilities commenced in May 2013. Sabine Pass Liquefaction recently began the
development of Train 5 and Train 6 and commenced the regulatory process in
February 2013. Sabine Pass Liquefaction has also entered into six third-party
LNG sale and purchase agreements ("SPAs"). The customers include BG Gulf Coast
LNG, LLC ("BG") for 5.5 mtpa, Gas Natural Aprovisionamientos SDG S.A. ("Gas
Natural Fenosa") for 3.5 mtpa, Korea Gas Corporation ("KOGAS") for 3.5 mtpa,
GAIL (India) Ltd. ("GAIL") for 3.5 mtpa, Total Gas & Power North America, Inc.
("Total") for 2.0 mtpa and Centrica plc ("Centrica") for 1.75 mtpa. In
addition, Sabine Pass Liquefaction has entered into an SPA with Cheniere
Marketing, LLC ("Cheniere Marketing") for up to 2.0 mtpa of LNG that is
produced but not already committed to third parties. The BG and Cheniere
Marketing SPAs commence with the start of Train 1 operations and the Gas
Natural Fenosa SPA commences with the start of Train 2 operations. The KOGAS
and GAIL SPAs commence with the start of Train 3 and Train 4 operations,
respectively, and the Total and Centrica SPAs commence with the start of Train
5 operations. Cheniere Partners has placed documentation pertaining to the
Liquefaction Project, including the applications and supporting studies, on
its website located at http://www.cheniereenergypartners.com.

For additional information, please refer to the Cheniere Energy Partners, L.P.
website at www.cheniereenergypartners.com and Quarterly Report on Form 10-Q
for the period ended June 30, 2013, filed with the Securities and Exchange
Commission.

This press release contains certain statements that may include
"forward-looking statements" within the meanings of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934.
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 our 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)
                            Three Months Ended        Six Months Ended
                            June 30,                  June 30,
                            2013         2012         2013         2012
Revenues
Revenues                    $ 66,842     $ 60,767     $ 132,406    $ 127,731
Revenues—affiliate          795          656          1,341        3,044
Total revenues              67,637       61,423       133,747      130,775
Expenses
Operating and maintenance   20,902       7,466        29,198       13,668
expense
Operating and maintenance   10,307       3,247        17,220       6,776
expense—affiliate
Depreciation expense        14,355       14,336       28,658       28,645
Development expense         3,318        14,472       6,803        31,141
Development                 611          1,031        1,062        2,262
expense—affiliate
General and administrative  2,028        2,193        5,803        4,497
expense
General and administrative  36,543       5,928        59,759       11,875
expense—affiliate
Total expenses              88,064       48,673       148,503      98,864
Income from operations      (20,427)     12,750       (14,756)     31,911
Other income (expense)
Interest expense, net       (42,016)     (43,458)     (82,278)     (86,916)
Loss on early               (80,510)     —            (80,510)
extinguishment of debt
Derivative gain (loss), net 95,509       261          78,041       (575)
Other                       434          61           760          132
Total other expense         (26,583)     (43,136)     (83,987)     (87,359)
Net loss                    $ (47,010)   $ (30,386)   $ (98,743)   $ (55,448)
Basic and diluted net       $ 0.11       $ 0.17       $ 0.21       $ 0.40
income per common unit
Weighted average number of
common units outstanding
used for basic and diluted  57,079       31,328       51,345       31,173
net income per common unit
calculation







                                              June 30, 2013  December 31, 2012
Cash and cash equivalents                     $  355,304     $   419,292
Restricted cash and cash equivalents          533,057        92,519
LNG Inventory                                 11,146         2,625
Other current assets ^(2)                     46,193         18,687
Non-current restricted cash and cash          1,777,749      272,425
equivalents
Property, plant and equipment, net            4,831,351      3,219,592
Debt issuance costs, net                      351,830        220,949
Non-current derivative assets                 81,762         —
Other assets                                  23,206         19,698
Total assets                                  $  8,011,598   $   4,265,787
Current liabilities ^(2)                      $  553,251     155,836
Long-term debt, net of discount               5,572,008      2,167,113
Deferred revenue, including affiliate         36,673         36,220
Long-term derivative liability                —              26,424
Other liabilities ^(2)                        1,212          216
Total partners' capital                       1,848,454      1,879,978
Total liabilities and partners' capital       $  8,011,598   $   4,265,787

__________________
(1) Please refer to the Cheniere Energy Partners, L.P. Quarterly Report on
Form 10-Q for the period ended June 30, 2013, 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.



SOURCE Cheniere Energy Partners, L.P.

Website: http://www.cheniere.com
Contact: Investors: Christina Burke: +1-713-375-5104, Nancy Bui:
+1-713-375-5280; Media: Diane Haggard: +1-713-375-5259