Cheniere Energy Partners Swings to Profit as Cargo Volumes Reaccelerate
Cheniere Energy Partners posted second-quarter net income of $1,161 million, more than double a year earlier, as LNG cargo volumes climbed 13% and the partnership advanced a new export train.
Cheniere Energy Partners (CQP) reported second-quarter net income of $1,161 million, up 110% from a year earlier, reversing a 71% decline in the first quarter. The Houston-based operator of the Sabine Pass liquefied natural gas terminal swung to that gain largely on derivative fair-value marks, which added $367 million in the second quarter after subtracting $677 million in the first.
The quarter marked an inflection in the partnership's operating trajectory even as top-line growth slowed. Revenue rose 5% year over year to $2,583 million, decelerating sharply from 20% growth in the first quarter and 18% growth in the fourth quarter of 2024. Adjusted EBITDA grew 35% to $983 million and accelerated from 13% growth in the prior quarter, a divergence that pointed to cargo throughput rather than pricing as the driver.
LNG export volumes climbed 13% year over year to 396 trillion British thermal units, a reacceleration after volumes were roughly flat in the first quarter (412 TBtu, up 1%) and up only modestly in the fourth quarter of 2024 (416 TBtu, up 4%). Cargo count rose 10% to 108, compared with no growth in the first quarter and a 4% increase in the fourth quarter. Cost of sales fell 36% to $765 million from $1,196 million a year earlier despite the higher revenue, reflecting a $526 million non-cash derivative gain embedded in that line versus a $159 million gain a year earlier.
Cheniere Energy Partners declared a distribution of $0.820 a unit for the quarter, up from $0.790 in the first quarter but still below the $0.830 declared in the fourth quarter of 2024. The base distribution held flat at $0.775 across all three periods, with the variable component rising to $0.045 from $0.015, indicating the increase came from cash-flow-linked upside rather than a change in the underlying payout policy. The partnership reconfirmed full-year 2026 distribution guidance of $3.10 to $3.40 a unit for the third consecutive release.
Cash and cash equivalents built steadily across the past two quarters, rising to $443 million at June 30 from $279 million at March 31 and $182 million at the end of 2024, while total available liquidity climbed to $2,337 million from $2,132 million and $2,025 million over the same periods. Total partners' equity rose to $754 million at June 30 from $414 million at year-end 2024, an 82% increase over two quarters.
Subsidiary Sabine Pass Liquefaction advanced its expansion plans, signing a lump-sum turnkey engineering, procurement and construction contract with Bechtel and issuing limited notice to proceed on Train 7, a roughly 6 million-tonne-per-annum addition, in May 2026. The project, first disclosed in an 8-K the prior quarter, remains subject to a final investment decision pending regulatory approvals.
The partnership also refinanced a portion of its debt stack in June, issuing $1.0 billion of 5.350% notes due 2036 and $750 million of 6.050% notes due 2056, using the proceeds to fully redeem $1.5 billion of Sabine Pass Liquefaction's 5.00% senior secured notes due 2027 and to help fund the Train 7 limited notice to proceed. That transaction was larger in scale than the scheduled note redemptions of roughly $53 million and $200 million to $300 million disclosed in the prior two quarters.