February 18, 2009 / 10:44 PM / 11 years ago

INTERVIEW-Cheniere to boost LNG imports to Sabine Pass

* Sabine Pass, La.,terminal to import 20-60 cargoes in ‘09

* Global natgas demand to fall, liquefaction to increase

* U.S. LNG imports to triple to over 1 trillion bcf

* Other proposed projects on hold

* Cheniere CEO confident of better performance

(Recasts, adds details)

NEW YORK, Feb 18 (Reuters) - U.S. liquefied natural gas terminal developer Cheniere (LNG.A) expects to boost its LNG imports in 2009 to its Sabine Pass terminal in Louisiana, as falling global natural gas demand coincides with increased liquefaction capacity, chief executive Charif Souki said on Wednesday.

The terminal, which received only three cargoes last year, was expected to import 20-60 cargoes, and could receive up to 150 billion cubic feet of gas in 2009, Souki said in an interview.

The Sabine Pass terminal currently has a capacity of 2.6 billion cubic feet of natural gas per day, with an expansion of phase of 1.4 bcf per day to be added in September. Other terminal capacity holders are France’s Total (TOTF.PA) and Chevron (CVX.N).

Cheniere struggled last year as market dynamics meant it was unable to fulfill its business strategy of attracting spot cargoes to its terminal in the United States, causing its share price to tumble.

“You are already starting to see a decrease in demand for natural gas worldwide at the same time as you see an increase in liquefaction capacity worldwide. The balances are going to be completely different,” he said.

Souki sees three times the amount of LNG coming to the United States in 2009, compared with 2008, amounting to over 1 trillion cubic feet of gas, smashing the previous record of 770 billion cubic feet in 2007.

“The terminal capacity will be again valuable and will be able to attract some cargoes in the spot market and probably also attract long term arrangements for people who need capacity in the United States,” Souki said.

Cheniere has put on hold any investment decisions for its other proposed projects in the U.S. Gulf of Mexico — the Corpus Christi and Creole Trail terminals — until an expansion at Sabine Pass is completed.

“Until we have commercialized the 2 bcf of capacity that we have at Sabine Pass, we are not contemplating anything at Corpus Christi and Creole Trail,” Souki said.

“We have to prove that the commercial theory under the additional 2 bcf of capacity is valid before we start making additional investments, “ he said.

The LNG terminal developer said that construction for expansion of the Sabine Pass terminal was 88 percent complete.

Souki was confident of a better performance for 2009 and beyond.

“We don’t have to raise capital for at least three years and if we have reasonable commercial success, we are fine. Barring some thing exceptional, this should be a pretty good year for us,” Souki said. (Reporting by Edward McAllister; Editing by Marguerita Choy)

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