Cameron LNG’s full run-rate earnings share for Sempra estimated at $400M+ annually

Cameron LNG (Courtesy Total)

Sempra Energy’s share of full run-rate earnings from Phase 1 of Cameron LNG export facility in Hackberry is expected to be between $400 million and $450 million annually, the company indicated in its third-quarter earnings report last week.

CEO Jeffrey Martin said cash flow from the operating Cameron LNG export facility in Louisiana is expected to fund a proposed second expansion. An affiliate of the company has asked FERC for a six-year extension to complete the expansion, which would add two more liquefaction trains, another LNG storage tank and other facilities. The expansion was originally approved in 2016, requiring the new facilities to be in service this year.

A final investment decision for the additional liquefaction units and other infrastructure is expected by mid-2021. Construction of the expansion could then take up to five years and put the new facilities on track to enter service in 2026.

The expansion would boost overall sendout to 1.29 Tcf/year, by expanding capacity by 515 Bcf annually.

Given Cameron’s favorable tolling agreement, Sempra also expects no earnings impact to Cameron from the recent hurricanes that stormed into Louisiana, said CFO Trevor Mihalik.

In August, Phase 1 of the export facility reached full commercial operations under Cameron LNG’s tolling agreements, marking the start of full run-rate earnings and cash flows.

Due to the structure of the tolling agreements at Cameron LNG, Sempra Energy does not expect any earnings impact as a result of the recent outages due to Hurricanes Laura and Delta on the U.S. Gulf Coast.

Read the earnings report here.