01—Abstract
Summary
Summary of the 10-K filed February 20, 2025. Cited figures are marked; the original filing is the authoritative source.
Cheniere Energy Partners, L.P. reported 2024 total revenues of $8.70 billiona, down from $9.66 billion in 2023, and net income of $2.51 billion, down from $4.25 billion.
The filing attributes the $1.7 billion net income decline primarily to $1.7 billionb lower gains from changes in the fair value of derivatives, mainly tied to the IPM agreement with Tourmaline Oil Marketing Corp. Regasification and LNG sales are supported by long-term contracts: the company states it has contracted approximately 80% of anticipated production from the Liquefaction Project, with approximately 13 years of weighted average remaining life as of December 31, 2024. Operating cash flow was $2.97 billion, and the company paid distributions of $2.24 billion in cash during 2024, declaring aggregate distributions of $3.465 per common unit for the year. Balance sheet and liquidity: at December 31, 2024, the partnership had $270 million of cash and cash equivalents, $109 million of restricted cash, $1.8 billion of available credit facility commitments, and $15.2 billion of total debt before unamortized discount and debt issuance costs.
Total available liquidity was $2.155 billionc. In May 2024 the company issued $1.2 billion of 5.750% Senior Notes due 2034, and Moody's upgraded its issuer credit rating to Baa2 from Ba1. The company is developing the SPL Expansion Project, with capacity of up to approximately 20 mtpa.
Its FERC application is pending, and the DOE authorized exports to FTA countries in October 2024. The filing states that development requires acceptable commercial and financing arrangements before a positive final investment decision. Risk and concentration considerations: the derivative-heavy earnings profile can produce large swings in reported net income, as shown by gains of $388 milliond in 2024 compared with $2.1 billion in 2023.
Customer concentration is significant, with BG Gulf Coast LNG, LLC and affiliates accounting for 22% of 2024 revenues. Cheniere Energy, Inc. owns 48.6% of the common units, and the partnership has no employees, relying on Cheniere personnel under services agreements.
02—Key points
Key Highlights
- Total revenues were $8.70 billion in 2024, versus $9.66 billion in 2023, and net income was $2.51 billion, versus $4.25 billion.
- The filing states that net income declined $1.7 billion, primarily from $1.7 billion of lower gains on derivative fair value changes, mostly tied to the Tourmaline IPM agreement.
- Approximately 80% of anticipated Liquefaction Project production is contracted, with approximately 13 years of weighted average remaining life as of December 31, 2024.
- Liquidity totaled $2.155 billion at year-end 2024, including $270 million of cash and cash equivalents and $1.8 billion of available credit facility commitments.
- Total debt was $15.2 billion, and the company issued $1.2 billion of 5.750% Senior Notes due 2034 in May 2024; Moody's upgraded CQP's issuer rating to Baa2.
- Aggregate 2024 distributions of $3.465 per common unit were declared, and a $0.820 per unit distribution for Q4 2024 was paid on February 14, 2025.
- The SPL Expansion Project (up to approximately 20 mtpa) awaits FERC approval and DOE non-FTA export approval; the DOE authorized FTA exports in October 2024.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-KFY2024filed February 20, 2025Financial Statements
FY2024 against FY2023
| Line item | FY2024FY2023 | Change |
|---|---|---|
| Revenue | $8.70B$9.66B | −9.9% |
| Operating Expenses | $5.42B$4.63B | +17.2% |
| Operating Income | $3.28B$5.04B | −34.9% |
| Net Income | $2.51B$4.25B | −41.0% |
05—Questions
Frequently Asked Questions
Why did net income fall so sharply in 2024?
The filing attributes the $1.7 billion decline in net income, from $4.25 billion to $2.51 billion, primarily to $1.7 billion of lower gains from changes in the fair value of derivatives. The majority came from the IPM agreement with Tourmaline Oil Marketing Corp, where associated gains fell from $1.8 billion to $251 million. Revenues also declined $960 million, mainly from lower Henry Hub-linked pricing.
How secure are the company's revenues?
The company states that its long-term SPAs generally require customers to pay a fixed fee on contracted volumes even if they cancel or suspend cargoes. Through its SPAs and IPM agreement, it has contracted approximately 80% of anticipated Liquefaction Project production, with approximately 13 years of weighted average remaining life. Estimated future revenues under executed SPAs total $122.2 billion, of which $45.1 billion is fixed fees. The filing notes that customers may still terminate in certain circumstances, such as failure to receive scheduled cargoes or force majeure events.
What are the main growth prospects?
The company is developing the SPL Expansion Project, with total production capacity of up to approximately 20 mtpa including debottlenecking. The FERC application was submitted in February 2024 and remains pending, and the DOE authorized exports to FTA countries in October 2024. Non-FTA approval is pending and subject to FERC permit approval. The filing states that a positive final investment decision requires acceptable commercial and financing arrangements.
What does the company's debt and distribution policy look like?
Total debt was $15.2 billion at December 31, 2024, with a weighted average contractual interest rate of 4.79%. Cash distributions paid in 2024 totaled $2.24 billion. The partnership distributes all available cash within 45 days after each quarter, less reserves set by the general partner. SPL's distributions are restricted unless debt service reserves are established and a debt service coverage ratio of 1.25:1.00 is met.
How concentrated is the customer base?
BG Gulf Coast LNG, LLC and affiliates accounted for 22% of 2024 total revenues, followed by Korea Gas Corporation at 15%, GAIL (India) Limited at 15%, Naturgy LNG GOM, Limited at 14%, and TotalEnergies at 11%. All of these customers contribute through SPA contracts. The filing states that substantially all long-term third-party customer arrangements are executed with creditworthy parent companies or secured by guarantees or collateral.
06—Continue