Summary
CMS Energy Corporation (CMS) announced on May 17, 2001, a significant long-term agreement through its subsidiary, Trunkline LNG Company. Trunkline LNG has entered into a 22-year contract with BG Group of the United Kingdom for the entire current uncommitted capacity of its Lake Charles, Louisiana liquefied natural gas (LNG) terminal. This agreement, commencing in January 2002, secures substantial future revenue for CMS Energy. This contract is a positive development as it provides considerable revenue certainty for the LNG terminal. The agreement covers approximately 5.1 billion cubic feet of vaporization and storage capacity, which will increase to 6.3 billion cubic feet after August 2005. CMS Energy estimates the present value of these firming revenues to be approximately $450 million, highlighting the strategic importance and financial benefit of this long-term customer commitment.
Key Highlights
- 1CMS Energy's Trunkline LNG unit signed a 22-year contract with BG Group for its Lake Charles, LA LNG terminal.
- 2The contract starts in January 2002 and covers all current uncommitted capacity.
- 3Initial capacity is 5.1 billion cubic feet, increasing to 6.3 billion cubic feet after August 2005.
- 4CMS Energy estimates the present value of revenues from this agreement to be approximately $450 million.
- 5Trunkline LNG Company is a subsidiary of Panhandle Eastern Pipe Line Company, which is a subsidiary of CMS Energy.
- 6The filing includes forward-looking statements subject to risks and uncertainties, as detailed in CMS Energy's and Panhandle's Form 10-K.