For the first time, San Diego-based Sempra Energy reported Thursday that its liquefied natural gas (LNG) business unit was in the black at the end of 2009, and the prospects are good for substantially greater profits this year from its Energia Costa Azul LNG terminal along the North Baja California Pacific Coast in Mexico and at Cameron along the Louisiana Gulf of Mexico coast.

Sempra LNG reported earnings of $16 million for 2009, compared with losses of $46 million in the previous full year. For the fourth quarter in each year, comparable results were $35 million this year and losses of $13 million the previous year.

In addition, Sempra CEO Donald Felsinger said construction has been completed on a $125 million nitrogen injection plant at the North Baja LNG facility. The project started operating last December, providing the company with “another source of contracted revenue” at the LNG facility, which has been under-utilized due to the slowdown in LNG shipments to North America.

After several months of delay, Sempra’s Cameron LNG facility has received two shipments from Qatar, the first late last year in what is expected to be up to 50 LNG shipments, and the second one came in January, according to Felsinger. Earlier in the year a report from a unit of the U.S. Department of Energy (DOE) said the initial shipment equated to 4.1 Bcf (see Daily GPI, Jan. 11).

In June 2009 Sempra LNG signed a flexible short-term agreement for the shipments from Qatar through the end of this year. At the time Sempra anticipated cargoes equivalent to about 4.8 Bcf each at its Cameron facility with deliveries to begin last August. Construction of the Cameron terminal was completed last summer.

With only 40% of Cameron’s capacity under contract, the Qatar contract is designed to allow Sempra to make fuller use of the facility. Supplies came late last November to Cameron from RasGas Co. Ltd., a Qatari joint stock company established in 2001 by Qatar Petroleum and ExxonMobil, which are 70% and 30% shareholders, respectively, according to the latest monthly report from the Office of Fossil Energy’s Natural Gas Regulatory Activities. The designated price for the shipment was $4.01/MMBtu, higher than another RasGas shipment earlier in November to Chevron at Sabine Pass, LA ($3.78/MMBtu).

“The United States now is seeing an increase in LNG flows,” Felsinger told financial analysts during an earnings conference call. “We’re optimistic in obtaining additional cargoes this year from Qatar under our agreement with RasGas.

“Both of our LNG terminals are supported by 20-year contracts that represent nearly 65% of the terminals’ total capacity.”

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