How to play the global LNG boom with Cheniere Energy

Cheniere Energy is expanding to grab a share of a growing market

An aerial view of the Cheniere Energy liquefied natural gas plant
(Image credit: Brandon Bell/Getty Images)

Over the past decade, the US has become one of the most influential countries in the global liquefied natural gas (LNG) market. From producing virtually nothing in the early 2010s, in 2022 the country became the world’s largest LNG exporter. By the end of the decade, almost one in every three tankers carrying the fuel will originate in the US, according to BloombergNEF. Production capacity from the country is expected to grow by 60% in the next three years. Companies such as Cheniere Energy (NYSE: LNG) and Venture Global (NYSE: VG) have powered the sector’s growth, investing tens of billions of dollars in the infrastructure required to turn natural gas into the supercooled liquid for export.

Vast LNG facilities – which chill natural gas down to -160˚C, transforming it into a liquid, and then pump it into specialised ships – consume vast amounts of capital and require coordinated efforts by all parties to get from the idea to the production stage. Cheniere’s Sabine Pass (owned by Cheniere Energy Partners LP (NYSE: CQP), a subsidiary of Cheniere Energy*) is the world’s largest liquefaction facility, with a total capacity of about 30 million tonnes a year (total US exports hit 88.3 million tonnes in 2024).

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Disclaimer

* Cheniere owns its Sabine Pass facility via Cheniere Energy Partners LP – a listed business structured as a partnership. This is typical in the US for firms that want to raise capital and limit liability. Income flows through the partnerships to shareholders and they usually offer higher payouts to attract investors. The parent company, Cheniere, owns 100% of the general-partner interest and a 48.6% limited-partner interest. The rest of the limited-partner units are traded on the NYSE, but due to the quirks of US-UK tax law, they’re not suitable for the average UK investor.

Rupert Hargreaves
Contributor and former deputy digital editor of MoneyWeek

Rupert is the former deputy digital editor of MoneyWeek. He's an active investor and has always been fascinated by the world of business and investing. His style has been heavily influenced by US investors Warren Buffett and Philip Carret. He is always looking for high-quality growth opportunities trading at a reasonable price, preferring cash generative businesses with strong balance sheets over blue-sky growth stocks.

Rupert has written for many UK and international publications including the Motley Fool, Gurufocus and ValueWalk, aimed at a range of readers; from the first timers to experienced high-net-worth individuals. Rupert has also founded and managed several businesses, including the New York-based hedge fund newsletter, Hidden Value Stocks. He has written over 20 ebooks and appeared as an expert commentator on the BBC World Service.