Cheniere Energy to Benefit as Texas Takes Stand in Support of LNG Receiving Terminal Development

Business Wire, May 25, 2004

Energy Editors/Business Editors

HOUSTON--(BUSINESS WIRE)--May 25, 2004

State Senate Passes Resolution Urging Federal Energy

Regulatory Commission to Expedite Permitting

Cheniere Energy, Inc. (AMEX:LNG)--In an effort to head off the state and national crisis posed by worsening natural gas supply shortages, the State of Texas is seeking to develop access to the world's abundant supplies in the form of Liquefied Natural Gas (LNG). As the largest consumer of natural gas in the nation, as well as the largest supplier of natural gas to the rest of the nation, Texas' State Senate unanimously passed Senate Resolution 108. The Resolution calls on the Federal Energy Regulatory Commission (FERC) to "expeditiously consider, approve and permit" LNG Receiving Terminals in Texas.

The Resolution was authored by one of the state's leading legislators, Senator Ken Armbrister, who serves as Chairman of the Senate Committee on Natural Resources, Senate Select Committee on Water Policy, and is also an active member of the Senate Committees on Business and Commerce, Government Organization, and State Affairs. Citing the threat of the high cost of natural gas on the economy nationwide and the effect those prices are having on consumers, manufacturers and power generators, the Resolution also noted the direct loss of jobs impacting the Texas economy. Federal Reserve Chairman Alan Greenspan's Congressional testimony was also noted in the bill, as he has repeatedly called on industry and government to expedite building LNG infrastructure to safeguard the nation's economy from the threat of natural gas supply shortages.

The Resolution declares that Texas should lead the "race to secure the country's access to other nation's abundant and cheaper supplies of natural gas, the most environmentally friendly fuel" through LNG Receiving Terminals located on the Texas coast. LNG Receiving Terminals would augment indigenous supplies and would allow Texas to "remain the leader in the natural gas industry and maintain a healthy business and industrial environment." The benefits of the terminals include lower and stabilized natural gas prices. The lower gas prices would create and retain jobs in the state and the nation. The existing pipeline infrastructure originating from Texas will provide the mechanism to distribute the increased supplies of natural gas to a gas starved nation.

Cheniere Energy Chairman, CEO & President Charif Souki said, "We applaud the Texas State Senate and Senator Armbrister for their decisive action on a critical issue facing Texas and the nation. As a company, we are working diligently to permit and build LNG receiving terminals that will provide all users of natural gas, industry, power generators and consumers, access to the world's abundant supply."

Complete text of Texas State Senate Resolution 108 (TX784SR 108) follows.

Cheniere Energy, Inc. is a Houston-based developer of LNG Receiving Terminals and a Gulf of Mexico E&P company. Cheniere is developing Gulf Coast LNG Receiving Terminals in Sabine Pass, LA, and Corpus Christi, TX. Cheniere is also a 30% limited partner in Freeport LNG Development, L.P., which is developing an LNG Receiving Terminal in Freeport, Texas. Cheniere conducts exploration for oil and gas in the Gulf of Mexico using a regional database of 7,000 square miles of PSTM 3D seismic data. Cheniere also owns 9% of Gryphon Exploration Company, along with Warburg, Pincus Equity Partners, L.P. which owns 91%. Additional information about Cheniere Energy, Inc. may be found on its Web site at www.cheniere.com, by contacting the company's investor and media relations department toll-free at 888-948-2036 or by writing to: Info@Cheniere.com.

Photographs of Artist's Renditions of Cheniere Energy Corpus Christi and Sabine Pass LNG Receiving Terminals and Freeport LNG LP LNG Receiving Terminal are available as JPEG on-line at www.Cheniere.com

Except for the historical statements contained herein, this news release presents forward-looking statements that involve risks and uncertainties. Although the company believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that its expectations will be achieved. Certain risks and uncertainties inherent in the company's business are set forth in the company's periodic reports that are filed with and available from the Securities and Exchange Commission.

Bill Number: TX784SR  108                          Filed: 05-05-2004

            Author: Armbrister


                              SENATE RESOLUTION

1          WHEREAS, Texas is the largest consumer of natural gas in

2    the nation and the largest exporter of natural gas to other

3    states; and

4          WHEREAS, Almost 60 percent of the homes in the United

5    States use natural gas; and

6          WHEREAS, Texas should be at the forefront in the race to

7    secure the country's access to other nations' abundant and

8    cheaper supplies of natural gas, the most environmentally

9    friendly fuel, by the importation of liquefied natural gas to

10   Texas receiving terminals; and

11         WHEREAS, Our country's lack of access to adequate supplies

12   of natural gas, which is a threat to our economy, has been

13   underscored repeatedly by Federal Reserve Chairman Alan

14   Greenspan in speeches and testimony before the Congress of the

15   United States as the nation's manufacturing and power industries

16   continue to lose jobs and consumers nationwide face escalating

17   energy bills; and

18         WHEREAS, Current natural gas prices and insufficient

19   supply have been detrimental to industries based in Texas; and

20         WHEREAS, Analysts expect continued high natural gas

21   prices, and liquefied natural gas imports have the potential to

22   reduce and stabilize natural gas prices; and

23         WHEREAS, Lower energy prices will create and retain jobs

24   in this state; and


                                   1

1          WHEREAS, It is necessary to develop liquefied natural gas

2    receiving terminals in the State of Texas in order for Texas to

3    remain the leader in the natural gas industry and maintain a

4    healthy business and industrial environment; and

5          WHEREAS, The development of liquefied natural gas

6    receiving terminals in Texas will benefit the people of Texas and

7    the nation; now, therefore, be it

8          RESOLVED, That the Senate of the State of Texas, 78th

9    Legislature, 4th Called Session, hereby respectfully urge the

10   Federal Energy Regulatory Commission to expeditiously consider,

11   approve, and permit applications for liquefied natural gas

12   receiving terminals in the State of Texas; and, be it further

13         RESOLVED, That the Secretary of the Senate forward copies

14   of this Resolution to the chairman of the Federal Energy

15   Regulatory Commission and to all the members of the Texas

16   congressional delegation.