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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): November 8, 2004
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CHENIERE ENERGY, INC.
(Exact name of registrant as specified in its charter)
Delaware 1-16383 95-4352386
(State or other jurisdiction of (Commission (I.R.S. Employer
incorporation or organization) File Number) Identification No.)
717 Texas Avenue
Suite 3100
Houston, Texas 77002
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (713) 659-1361
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
|_| Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.14d-2(b))
|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
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Item 1.01. Entry into a Material Definitive Agreement.
On November 8, 2004, Cheniere Energy, Inc.'s wholly owned partnership,
Sabine Pass LNG, L.P. (Sabine Pass LNG), entered into a Terminal Use Agreement
(TUA) to provide Chevron USA, Inc. (Chevron USA), a wholly-owned subsidiary of
ChevronTexaco Corporation (NYSE: CVX) (ChevronTexaco), with 700 million cubic
feet per day (mmcf/d) of liquefied natural gas (LNG) regasification capacity at
the 2.6 billion cubic feet per day (Bcf/d) LNG receiving terminal being
developed by Sabine Pass LNG in Cameron Parish, Louisiana. Cheniere, Sabine Pass
LNG and Chevron USA simultaneously entered into an Omnibus Agreement, under
which Chevron USA agreed to make advance Capacity Reservation Fee payments and
the companies agreed to continue to negotiate for Chevron USA to make a $200
million equity investment to acquire a 20% limited partner interest in Sabine
Pass LNG. The TUA and Omnibus Agreement remain subject to final corporate
approvals, including approval by the ChevronTexaco Board of Directors, by
December 20, 2004.
The TUA provides for Chevron USA to pay a tariff of $0.32 per million
British thermal units, subject in part to adjustment for inflation, for 700
mmcf/d of regasification capacity for a 20-year period beginning not later than
July 1, 2009. Under the Omnibus Agreement, Chevron USA has the option, at the
same tariff, either to reduce its reserved capacity at Sabine Pass to 500 mmcf/d
by July 1, 2005 or to increase its reserved capacity to 1.0 Bcf/d by December 1,
2005. ChevronTexaco will guarantee certain of its subsidiary's obligations under
the TUA.
The Omnibus Agreement requires Chevron USA to make advance Capacity
Reservation Fee payments to Sabine Pass LNG totaling up to $20 million,
beginning with an unconditional payment of $5 million within 15 days. Except for
this $5 million payment, Chevron USA has the right to terminate the TUA, the
Omnibus Agreement and the transactions under those agreements if approval of
ChevronTexaco's board of directors is not obtained by December 20, 2004. If the
agreements and transactions are not terminated, further advance Capacity
Reservation Fee payments will be due -- $7 million after ChevronTexaco's board
approval; $5 million after December 20, 2004, conditioned upon both Federal
Energy Regulatory Commission (FERC) approval of the pending application to build
the Sabine Pass terminal and confirmation of evidence of the ability to finance
construction of the facility; and $3 million if Chevron USA exercises the option
to increase its capacity at Sabine Pass to 1.0 Bcf/d. These Capacity Reservation
Fee payments will be amortized over a ten-year period as a reduction of Chevron
USA's regasification capacity tariff under the TUA.
On November 9, 2004, Cheniere Energy, Inc. issued a press release regarding
the foregoing. That press release is attached hereto as Exhibit 99.1.
Item 9.01. Financial Statements and Exhibits.
c) Exhibits
Exhibit
Number Description
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99.1 Press Release, dated November 9, 2004 (filed herewith).
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: November 9, 2004 CHENIERE ENERGY, INC.
By: /s/ Don A. Turkleson
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Name: Don A. Turkleson
Title: Senior Vice President and
Chief Financial Officer
EXHIBIT INDEX
Exhibit
Number Description
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99.1 Press Release, dated November 9, 2004 (filed herewith).