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Why Cheniere Energy Partners Rallied Nearly 11% in November

By Matthew DiLallo - Dec 10, 2018 at 2:23PM

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The LNG export company reported some good news last month.

What happened

Cheniere Energy Partners (CQP -1.73%) rallied 10.9% in November, according to data provided by S&P Global Market Intelligence. Fueling the liquefied natural gas (LNG) company was its strong third-quarter report and a bullish outlook for 2018 and 2019.

So what

Cheniere Energy Partners produced $604 million of adjusted EBITDA in the third quarter, more than double what it hauled in during the year-ago period. Fueling the LNG company's earnings surge was a big uptick in LNG volumes exported, which rose from 44 cargos in the year-ago period to 65 in this year's third quarter after the company brought additional LNG liquefaction units online.

An LNG tanker departing an export facility.

Image source: Getty Images.

The company achieved first LNG production from its fifth liquefaction train during October, which puts it on track to be fully operational in the first quarter of next year. That start-up, along with the company's strong showing during the third quarter, enabled Cheniere Energy Partners to boost its full-year outlook while providing its initial guidance for 2019. The LNG producer now expects to be able to distribute $2.27 to $2.30 per unit to investors in 2018, an increase from its initial projection that it would send $2 to $2.20 per unit back to investors. Meanwhile, the company expects that it should be able to distribute $2.35 to $2.55 per unit in 2019.

Finally, Cheniere Energy Partners took another step toward sanctioning the sixth train at its Sabine Pass facility after signing an agreement with Bechtel to begin early engineering, procurement, and site work.

Now what

Cheniere Energy Partners' LNG expansion program continued to pay dividends for investors during the third quarter. The company has been able to grow its volumes at a fast pace over the past year by completing additional LNG trains. With another one just starting up and the sixth one in development, Cheniere Energy Partners should be able to continue growing in the coming years.

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