Cheniere Energy, Inc.

Cheniere Energy, Inc. is a Houston-based energy infrastructure company primarily engaged in LNG-related businesses, providing clean, secure and affordable LNG to integrated energy companies, utilities and energy trading companies around the world. As of December 31, 2025, the company was the largest producer of LNG in the U.S. and the second largest LNG operator globally, based on the total production capacity of its natural gas liquefaction facilities. The company operates two major liquefaction and export facilities: the Sabine Pass LNG Terminal in Cameron Parish, Louisiana, and the Corpus Christi LNG Terminal near Corpus Christi, Texas. The industry is characterized by increasing global demand for LNG, with Wood Mackenzie Limited forecasting that global demand for LNG would increase by approximately 64% ¹, from approximately 410 mtpa, or 19.7 Tcf, in 2024, to 671 mtpa, or 32.2 Tcf, in 2040 and by approximately 67% ² to 685 mtpa or 32.9 Tcf in 2050. WoodMac also forecasted LNG production from existing operational facilities and new facilities already under construction would be able to supply the market with approximately 568 mtpa in 2040, declining to about 472 mtpa in 2050, potentially resulting in a market need for construction of an additional approximately 104 mtpa of LNG production by 2040 and about 212 mtpa by 2050. The company believes its capital and operating costs are competitive with new proposed projects globally and that it is well-positioned to capture a portion of this incremental market need.

Cheniere Energy's primary competitors are other natural gas liquefaction projects throughout the world, and the company competes primarily on the basis of price per contracted volume of LNG, as well as attributes such as commercial innovation, reliable production and customer-focused operations to provide flexible and tailored solutions to LNG buyers. The company's stated competitive advantages include its position as the largest producer of LNG in the U.S. and the second largest LNG operator globally, with total production capacity expected to be over 60 mtpa of LNG ³, inclusive of estimated debottlenecking opportunities. The company has contracted approximately 90% ⁴ of the total anticipated production from its Liquefaction Projects through the mid-2030s, excluding volumes from contracts with terms less than 10 years and volumes from SPAs that are conditional on additional liquefaction capacity beyond what is currently in construction or operation, subject to unilateral waiver by the company. As of December 31, 2025, the company had SPAs with initial terms of 10 or more years with approximately 30 ⁵ different third party customers, with customers under common control being considered a single customer.

Cheniere Energy generates revenue primarily through long-term LNG sale and purchase agreements (SPAs) and integrated production marketing (IPM) agreements, which form the foundation of its business and provide significant, stable, long-term cash flows. Under its SPAs, customers are generally required to pay a fixed fee with respect to the contracted volumes irrespective of their election to cancel or suspend deliveries of LNG cargoes, plus a variable fee component primarily indexed to Henry Hub and generally structured to cover the cost of natural gas purchases, transportation and liquefaction fuel consumed to produce LNG. Under IPM agreements, a gas producer sells natural gas to the company on a global LNG or natural gas index price, less a fixed liquefaction fee, shipping and other costs. LNG produced by the Liquefaction Projects that is not contracted under long-term contracts is available for Cheniere Marketing, the company's integrated marketing function, to sell in the global market under spot sales or other short-term agreements. The company's long-term counterparty arrangements have a weighted average remaining life of approximately 15 years ⁶ as of December 31, 2025.

Cheniere Energy's revenue is derived from three primary categories: LNG revenues, regasification revenues, and other revenues. LNG revenues, which constitute the vast majority of total revenues, are generated from the sale of LNG produced at the company's two liquefaction facilities. For the year ended December 31, 2025, LNG revenues were $19.435 billion ⁷, compared to $14.899 billion ⁸ in 2024. These revenues are further broken down into LNG from the Liquefaction Projects sold under third party long-term agreements, which generated $14.804 billion ⁹ in 2025, LNG from the Liquefaction Projects sold by the integrated marketing function under short-term agreements, which generated $3.794 billion ¹⁰, LNG procured from third parties, which generated $226 million ¹¹, net derivative gains of $344 million ¹², and other revenues of $267 million ¹³. Regasification revenues, generated from the Sabine Pass LNG Terminal's regasification capacity, were $136 million ¹⁴ for the year ended December 31, 2025, compared to $135 million ¹⁵ in 2024. Other revenues, which include sublease and subcharter income from LNG vessels, were $405 million ¹⁶ for 2025, compared to $669 million ¹⁷ in 2024. Total volumes delivered as LNG revenues in 2025 were 2,438 TBtu ¹⁸, compared to 2,349 TBtu ¹⁹ in 2024.

The Sabine Pass LNG Terminal has over 30 mtpa ²⁰ of total production capacity in operation from natural gas liquefaction facilities, five LNG storage tanks with aggregate capacity of approximately 17 Bcfe ²¹ and vaporizers with regasification capacity of approximately 4 Bcf/d ²², as well as three marine berths, two of which can accommodate vessels with nominal capacity of up to 266,000 cubic meters ²³ and the third berth, which can accommodate vessels with nominal capacity of up to 200,000 cubic meters ²⁴. The company also owns and operates through CQP a 94-mile ²⁵ natural gas supply pipeline (the Creole Trail Pipeline) that interconnects the Sabine Pass LNG Terminal with several large interstate and intrastate pipelines. The Corpus Christi LNG Terminal has over 30 mtpa ²⁶ of total expected production capacity, inclusive of estimated debottlenecking opportunities, including over 9 mtpa ²⁷ under construction and the remainder in operation as of December 31, 2025. The Corpus Christi LNG Terminal also has three LNG storage tanks with aggregate capacity of approximately 10 Bcfe ²⁸ and two marine berths that can each accommodate vessels with nominal capacity of up to 266,000 cubic meters ²⁹. The company also owns and operates an approximately 21-mile ³⁰ natural gas supply pipeline (the Corpus Christi Pipeline) that interconnects the Corpus Christi LNG Terminal with several large interstate and intrastate natural gas pipelines. The projects under construction at the Corpus Christi LNG Terminal include the Corpus Christi Stage 3 Project, consisting of seven midscale Trains expected to add total production capacity of over 10 mtpa ³¹ of LNG once fully completed, with over 4 mtpa ³² under construction and the remainder in operation from the first four midscale Trains that have reached substantial completion as of December 31, 2025, and the CCL Midscale Trains 8 & 9 Project, expected to add total production capacity of approximately 5 mtpa ³³ of LNG once fully completed, inclusive of estimated debottlenecking opportunities, which was under construction as of December 31, 2025.

During the year ended December 31, 2025, Cheniere Energy achieved several significant operational and financial milestones. The company's Board made a positive final investment decision (FID) with respect to the CCL Midscale Trains 8 & 9 Project on June 17, 2025 ³⁴, and issued a full notice to proceed with construction to Bechtel Energy Inc. effective June 18, 2025 ³⁵. Substantial completions of Trains 1, 2, 3 and 4 of the Corpus Christi Stage 3 Project were achieved in March, August, October and December 2025, respectively. In August 2025, Cheniere announced the execution of a long-term LNG SPA between Cheniere Marketing and JERA Co., Inc., under which JERA has agreed to purchase approximately 1 mtpa ³⁶ of LNG from Cheniere Marketing on an FOB basis from 2029 through 2050. In May 2025, Cheniere Marketing entered into an IPM agreement with Canadian Natural Resources Limited to purchase 140,000 MMBtu per day ³⁷ of natural gas at a price based on the Japan Korea Marker, less fixed LNG shipping costs and a fixed liquefaction fee, for a term of approximately 15 years commencing in 2030. In July 2025, CQP issued and sold $1.0 billion ³⁸ aggregate principal amount of 5.550% Senior Notes due 2035, and the net proceeds, together with cash on hand, were used to redeem $1.0 billion ³⁹ of the aggregate principal amount of SPL's 2026 SPL Senior Notes. During the year ended December 31, 2025, the company repurchased approximately 12.1 million ⁴⁰ shares of its common stock as part of its share repurchase program for approximately $2.7 billion ⁴¹. The company also redeemed and repaid $652 million ⁴² aggregate principal amount of notes across its complex and paid dividends of $2.055 ⁴³ per share of common stock during the year. In February 2026, the Board approved an increase in the share repurchase authorization to approximately $10 billion ⁴⁴ from 2026 through 2030 with a $9 billion ⁴⁵ increase to the existing authorization.

For the fiscal year ended December 31, 2025, Cheniere Energy reported total revenues of $19.976 billion ⁴⁶, compared to $15.703 billion ⁴⁷ in 2024. Net income attributable to Cheniere was $5.330 billion ⁴⁸, or $24.13 ⁴⁹ per diluted share, compared to $3.252 billion ⁵⁰, or $14.20 ⁵¹ per diluted share, in the prior year. The increase in net income was primarily due to $2.3 billion ⁵² of favorable changes in the fair value of agreements accounted for as derivative instruments (before tax and the impact of NCI), largely associated with derivatives related to IPM agreements, and an $876 million ⁵³ increase in revenues, net of cost of natural gas feedstock, from increased volume of LNG loaded and recognized between the years. Income from operations was $9.112 billion ⁵⁴ in 2025, compared to $6.128 billion ⁵⁵ in 2024. Net cash provided by operating activities was $5.539 billion ⁵⁶ in 2025, compared to $5.394 billion ⁵⁷ in 2024.

A primary growth vector for Cheniere Energy is the expansion of its liquefaction capacity at both the Sabine Pass LNG Terminal and the Corpus Christi LNG Terminal. The company is developing the SPL Expansion Project, a two-phased expansion adjacent to the SPL Project inclusive of three liquefaction trains and supporting infrastructure, with an expected total peak production capacity of up to approximately 20 mtpa ⁵⁸ of LNG, inclusive of estimated debottlenecking opportunities. Following a pre-filing in July 2025, in February 2026, the company filed an application with the FERC under the NGA for authorization to site, construct and operate the CCL Expansion Project in a phased approach, inclusive of four liquefaction trains and supporting infrastructure, with an expected total peak production capacity of up to 24 mtpa ⁵⁹ of LNG, inclusive of estimated debottlenecking opportunities. The company also filed an application with the FERC in December 2025 to increase the LNG production capacity of the previously-authorized Corpus Christi Stage 3 Project and CCL Midscale Trains 8 & 9 Project by approximately 5 mtpa ⁶⁰, which remains pending at the FERC. These projects require, among other things, regulatory approvals and acceptable commercial and financing arrangements before a positive FID is made. The target FID milestone for the SPL Expansion Project is 2026/2027 ⁶¹ and for the CCL Expansion Project is 2027/2028 ⁶².

Another significant growth vector is the continued commercialization and contracting of LNG volumes under long-term SPAs and IPM agreements. In August 2025, Cheniere announced the execution of a long-term LNG SPA between Cheniere Marketing and JERA Co., Inc., under which JERA has agreed to purchase approximately 1 mtpa ⁶³ of LNG from Cheniere Marketing on an FOB basis from 2029 through 2050, with the purchase price indexed to the Henry Hub price, plus a fixed liquefaction fee. In May 2025, Cheniere Marketing entered into an IPM agreement with Canadian Natural Resources Limited to purchase 140,000 MMBtu per day ⁶⁴ of natural gas at a price based on the Japan Korea Marker, less fixed LNG shipping costs and a fixed liquefaction fee, for a term of approximately 15 years commencing in 2030. The company believes that continued global demand for natural gas and LNG, as well as the current geopolitical environment that has intensified the demand for supply security, should enable it to enter into long-term agreements and provide a foundation for additional growth in its business in the future.

Management discussed the impact of the One Big Beautiful Bill Act (OBBBA), signed into law on July 4, 2025, which includes reinstating 100% accelerated tax bonus depreciation on qualifying assets acquired after January 19, 2025, which deferred the company's cash tax obligations, ultimately reducing its income tax payable to a nominal amount in 2025. The OBBBA also modifies the export-promoting Foreign Derived Intangible Income (FDII) deduction rules, renamed to the Foreign Derived Deduction Eligible Income (FDDEI) under the OBBBA beginning in 2026, which is expected to reduce the company's income taxes payable relative to prior policy in future periods. The FDDEI regime provides for an effective tax rate of 14% ⁶⁵, a rate lower than the statutory corporate tax rate of 21% ⁶⁶, on eligible sales of property or services to a foreign person for foreign use. The company expects that the FDDEI regime will favorably impact its effective tax rate relative to prior policy, as a larger portion of its export-related income is projected to be eligible for a preferential tax rate despite an increase in the tax rate on qualifying sales.

The company's operational outlook includes the continued construction and completion of the Corpus Christi Stage 3 Project and the CCL Midscale Trains 8 & 9 Project. As of December 31, 2025, the overall project completion percentage for the Corpus Christi Stage 3 Project was 94.1% ⁶⁷, with engineering at 99.6% ⁶⁸, procurement at 100.0% ⁶⁹, subcontract work at 95.1% ⁷⁰, and construction at 84.7% ⁷¹, with the date of expected substantial completion in 1H 2026 - 2H 2026 ⁷². For the CCL Midscale Trains 8 & 9 Project, the overall project completion percentage was 31.8% ⁷³, with engineering at 75.5% ⁷⁴, procurement at 47.3% ⁷⁵, subcontract work at 29.0% ⁷⁶, and construction at 0.2% ⁷⁷, with the date of expected substantial completion in 2H 2028 ⁷⁸. The company expects the operation and maintenance of these new Trains and increased LNG volumes produced to result in higher revenues and operating costs and expenses. The company also noted that prior to the commencement of long-term SPAs associated with these volumes, the additional volumes will be sold by its integrated marketing function at prevailing market prices.

Cheniere Energy's capital allocation plan is designed to invest in financially disciplined growth accretive to its common stock, strengthen its balance sheet, and return capital to stockholders. The company's capital investment parameters include achieving value accretive returns through long-term commercial contracts, aiming to contract approximately 90% ⁷⁹ of current and planned liquefaction capacity under long-term SPAs and IPM agreements with creditworthy counterparties, and achieving credit accretive returns by conservatively funding projects through financing structures that sustain long-term, run-rate leverage and credit metrics. As of December 31, 2025, the company had $1.2 billion ⁸⁰ of repurchase authority remaining under its share repurchase program, which subsequently increased to approximately $10 billion ⁸¹ from 2026 through 2030 after a $9 billion ⁸² increase was authorized in February 2026. In June 2025, the company announced a plan to increase its annualized dividend by over 10% ⁸³ to $2.22 ⁸⁴ per common share, which commenced with the dividend pertaining to the third quarter of 2025. The company expects to continue to pay quarterly dividends to its stockholders, with the goal of increasing the dividend over time. The company also aims to lower its long-term leverage target through debt paydown to approximately 4x ⁸⁵.

Management identified several structural headwinds and constraints to its growth plan. The company's ability to enter into additional long-term SPAs to underpin the development of additional Trains, sell LNG through Cheniere Marketing or develop new projects is subject to market factors, including changes in worldwide supply and demand for natural gas, LNG and substitute products, the relative prices for natural gas, crude oil and substitute products in North America and international markets, the extent of energy security needs in the EU and elsewhere, the rate of fuel switching from coal, nuclear or oil to natural gas, and global economic growth and the pace of any transition from fossil-based systems of energy production and consumption to alternative energy sources. The company also faces risks related to changes in U.S. trade policy, including the Section 301 Investigation of the maritime, logistics and shipbuilding sector in China, which mandated restrictions on maritime transport services for U.S. LNG exports, requiring that beginning in April 2029, 1% ⁸⁶ of U.S. LNG exports must be exported on U.S.-built vessels, with such percentage gradually increasing to 15% ⁸⁷ in April 2047, with certain exceptions. The company noted that the timeline for the U.S.-built vessel requirements for U.S. LNG exports thus far has not been modified despite a suspension of certain other measures.

Additional constraints flagged by management include the cyclical nature of the LNG and natural gas markets, with prices subject to wide fluctuations in response to factors such as insufficient or oversupply of natural gas liquefaction or receiving capacity worldwide, weather conditions, reduced demand and lower prices for natural gas worldwide, and changes in regulatory, tax or other governmental policies regarding exported North American LNG. The company also faces risks related to the failure of exported LNG to be a long-term competitive source of energy for international markets, as LNG from the Liquefaction Projects competes with other sources of LNG, including LNG that is priced to indices other than Henry Hub, and with alternative, cleaner sources of energy as such alternative sources emerge. The company's ability to obtain additional funding to execute its business strategy is subject to the investment community's appetite for investment in LNG and natural gas infrastructure and its ability to access capital markets, with a variety of factors beyond its control potentially impacting the availability or cost of capital, including domestic or international economic conditions, increases in key benchmark interest rates and/or credit spreads, and the adoption of new or amended banking or capital market laws or regulations.

Cheniere Energy's business is substantially dependent upon the performance of customers under long-term contracts, and a failure by a significant portion of customers to perform could materially and adversely affect the company. As of December 31, 2025, the company had SPAs with initial terms of 10 or more years with approximately 30 ⁸⁸ different third party customers. The company's ability to generate cash is also dependent on sourcing capital, and as of December 31, 2025, it had $23.0 billion ⁸⁹ of total debt outstanding and $7.2 billion ⁹⁰ of available commitments under its credit facilities, with significant interest expense and future financing needs for expansion projects. The company faces significant construction and operating hazards, including cost overruns and delays in the construction of expansion projects such as the Corpus Christi Stage 3 Project, which was 94.1% ⁹¹ complete as of December 31, 2025, and the CCL Midscale Trains 8 & 9 Project, which was 31.8% ⁹² complete. The company is also exposed to risks from changes in U.S. trade policy, including the Section 301 Investigation which mandates that beginning in April 2029, 1% ⁹³ of U.S. LNG exports must be on U.S.-built vessels, increasing to 15% ⁹⁴ in April 2047. Additionally, the company's use of derivative instruments, including IPM agreements, resulted in $3.6 billion ⁹⁵ of gains in 2025 from changes in fair values, and such instruments can cause substantial volatility in reported earnings.

Management's message to shareholders emphasizes the company's focus on safety, operational excellence, customer satisfaction, and disciplined accretive growth. The company's primary business strategy is to be a full-service LNG provider to worldwide end-use customers by owning, constructing and operating LNG and natural gas infrastructure facilities. Management highlights the company's updated comprehensive, long-term capital allocation plan announced in June 2024, which includes an increased share repurchase authorization and increased dividends, in addition to a continued decrease in consolidated long-term leverage and investment in accretive organic growth. In June 2025, the company announced updates to its company outlook, which included a plan to increase its annualized dividend by over 10% ⁹⁶ to $2.22 ⁹⁷ per common share, which commenced with the dividend pertaining to the third quarter of 2025. Management also emphasizes the company's 'all of the above' capital allocation strategy, focused on strengthening the balance sheet, funding financially disciplined growth and returning capital to stockholders. The company's strategic priorities for the period ahead include completing its construction projects safely, on-time and on-budget, continuing to secure long-term customer contracts to support planned expansion, including the FID of potential expansion projects beyond the Corpus Christi Stage 3 Project and CCL Midscale Trains 8 & 9 Project, and maintaining a flexible capital structure to finance the acquisition, development, construction and operation of energy assets.