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Cheniere Energy Sells Its 5.05% Stake to State-Owned ADIA

Per a filingwith the U.S. Securities and Exchange Commission,Cheniere Energy, Inc.’s LNG 5.05% share has been purchased by the state-owned Abu Dhabi Investment Authority (ADIA).

With the purchase of worth 12.7 million shares of Cheniere Energy valued at about $615 million, the sovereign wealth fund now becomes this Houston-based energy player's fourth-largest shareholder. As stated by the Sovereign Wealth Fund Institute, Abu Dhabi Investment Authority is the world’s third-largest sovereign wealth fund with assets worth $597.6 billion

Apart from Abu Dhabi, other Middle Eastern state-owned companies showed interest in holding equity in U.S. LNG export facilities. Earlier this January, Saudi Arabian Oil Company also known as Aramco entered into an Interim Participation Project Agreement (IPPA) with southern California-based Sempra Energy (SRE). The deal involves making a final investment decision on the proposed Port Arthur LNG export project in Texas.

The IPPA followed a number of agreements the companies signed in May last year for Saudi Aramco to buy 5 million metric tons of LNG annually and make a 25% equity investment in a yet-to-be approved project.

About the Company

Cheniere Energy is primarily engaged in businesses related to liquefied natural gas (or LNG) through its two business segments, namely LNG terminal, and LNG and natural gas marketing. The company through its controlling interest in Cheniere Energy Partners L.P. owns and operates the Sabine Pass LNG terminal (North America’s first large-scale liquefied gas export facility) in Louisiana.


Earlier this month, management informed that Hurricane Laura did not inflict any serious loss on its pipeline assets offshore Louisiana and Sabine Pass liquefaction plants after making landfall. So, the company plans to restart its LNG production at these facilities and also assured $1 million to local organizations, which are engaged in hurricane-relief efforts.

Zacks Rank & Key Picks

Cheniere Energy currently carries a Zacks Rank #3 (Hold). Some better-ranked players in the same space are Murphy USA Inc. MUSA, Laredo Petroleum, Inc. LPI and SilverBow Resources Inc. SBOW, each presently sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

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