Despite short- and long-term contracts for liquefied natural gas (LNG) supplies at its newest of two North American LNG terminals, San Diego-based Sempra Energy remains unconcerned about the lack of any commercial shipments through its new Cameron, LA, facility in the third quarter, executives said Monday.
During an earnings conference call, Sempra CEO Donald Felsinger reported that profits were up quarter-over-quarter and the prospects for continued growth in all of its businesses remain good.
Although at both Cameron and its North Baja California LNG terminal in Mexico Sempra has long-term contracts, so far this year Sempra LNG operations continued to report losses for the first nine months, albeit smaller than the losses in the same nine-months last year ($19 million for this past third quarter, compared with $33 million in the same period last year). For the immediate past quarter, Sempra LNG broke even, compared to a $4 million loss in the third quarter in 2008.
Felsinger said the LNG business, now truly global in scope, is not so much driven around volumes but rather contracts.
“In the third quarter we did not have any volumes come in under the RasGas contract,” said President Neal Schmale, responding to a question about the short-term, 10-shipment deal that Sempra announced in June with the Qatar government-backed LNG supply company. It is a unit of RasGas Co. Ltd., a Qatari joint stock company established in 2001 by Qatar Petroleum and ExxonMobil (see Daily GPI, June 9).
At the time Sempra said shipments were expected to start last August and run through 2010. Sempra would not place a dollar value on the contract, but Sempra LNG CEO Darcel Hulse expressed much satisfaction in having the world’s biggest LNG supplier, Qatar, choose to have Sempra and its Cameron facility “help them place cargoes in the U.S. marketplace during this period of time when we find ourselves in a recession and are bringing online the largest new supplies of LNG in the history of LNG,” Hulse said.
“Over the course of the [18-month deal] we would fully expect to have volumes into Cameron, but in terms of discussing the near-term potential [for shipments] obviously for contractual reasons, we can’t talk about exactly what is going on at any particular point in time,” Schmale told financial analysts on Monday’s conference call. “I would reiterate the point Don [Felsinger] made that these businesses are largely dependent and well served by the long-term contracts we entered into.”
Â©Copyright 2009Intelligence Press Inc. All rights reserved. The preceding news reportmay not be republished or redistributed, in whole or in part, in anyform, without prior written consent of Intelligence Press, Inc.
© 2023 Natural Gas Intelligence. All rights reserved.
ISSN © 1532-1231 | ISSN © 2577-9877 |