S&P affirms Cheniere Energy

Standard & Poor's said it affirmed Cheniere Energy Inc.'s B corporate credit rating and the BB rating with a recovery rating of 3 on Cheniere LNG Holdings LLC's $600 million term loan B. The outlook is stable.

The proceeds from the bank loan were distributed to Cheniere Energy to support future liquid natural gas terminal development activities and to fund a reserve to cover debt service payments and operating expenses during the four-year period before distributions are expected to begin from the Sabine Pass LNG terminal.

S&P said the affirmation incorporates the progress made to date on the construction of the Sabine Pass liquid natural gas terminal, including the delays and additional costs imposed by Hurricane Katrina as well as Chevron's decision, in December 2005, to increase its offtake from the terminal to 1 billion cubic feet per day (bcf/day) from 700 MMcf/day.

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