ChevronTexaco Acquires Capacity at Sabine Pass LNG Terminal

Sabine Pass LNG Plant
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Cheniere Energy has entered into Terminal Use and related agreements with a subsidiary of ChevronTexaco to provide it with 700 million cubic feet per day (mmcf/d) of liquefied natural gas (LNG) regasification capacity at the Sabine Pass LNG receiving terminal. ChevronTexaco also has an option to increase its capacity to 1.0 billion cubic feet per day (Bcf/d) or to decrease it to 500 mmcf/d. The agreements remain subject to final approval by ChevronTexaco management by December 20, 2004.

The companies also have agreed to continue to negotiate definitive agreements for ChevronTexaco to make a $200 million equity investment in Cheniere's wholly owned Sabine Pass LNG, L.P., which will own and operate the terminal, in exchange for a 20% limited partner interest.

Keith Meyer, President of Cheniere LNG, Inc., a wholly owned subsidiary of Cheniere Energy said, "Cheniere has a commitment to creating LNG gateways to North America that will provide safe, reliable, and efficient service to our customers. We are very pleased to have the opportunity to serve ChevronTexaco as a major customer in what we hope will be a growing relationship."

For additional information on the agreements, please refer to the Cheniere Energy, Inc. Current Report on Form 8-K filed with the Securities and Exchange Commission.

Cheniere's 2.6 Bcf/d Sabine Pass LNG project received its Draft Environmental Impact Statement from FERC on August 12, 2004. Construction is planned to begin by the end of the first quarter of 2005.

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