US LNG Exports Hit Record: 4 Stocks Worth Investor Watch

The United States hit a new record for shipping liquefied natural gas (LNG) in August, exporting 9.33 million metric tons. The surge — based on figures from financial firm LSEG reported by Reuters — reflects both robust plant output and steady European demand, reaffirming the country’s role as the world’s leading LNG supplier. Major companies like Cheniere Energy (LNG), Shell (SHEL), Venture Global (VG) and Chevron (CVX) are in great positions to benefit from this record-setting export trend.

US Reaches LNG Milestone

Last month, the United States exported a record volume of LNG, topping the previous record set in April.

One major driver of August’s record was Venture Global’s Plaquemines facility in Louisiana. Though still under construction, the plant shipped 1.6 million tons, or 17% of the monthly total. With all 18 Phase 1 trains expected online soon, Venture Global’s facility is set to be a cornerstone of the U.S. LNG capacity for years. The project demonstrates how new infrastructure is directly translating into higher export levels. Investors should know that Venture Global achieved its first LNG production at the Plaquemines plant in December.

Europe remained the number one buyer, importing 6.16 million tons in August compared with 5.25 million in the previous month. Lower storage levels, coupled with muted competition from Asia, allowed the continent to secure larger volumes at favorable prices. Then again, liftings by Asia dipped slightly to 1.47 million tons, reflecting weaker demand and higher inventories in the region. Egypt also emerged as a consistent customer, buying nine shipments as a drop in its gas production forces the country to source more fuel abroad.

Investment Outlook

With exports climbing, the likes of Cheniere Energy, Shell, Venture Global and Chevron stand to gain from the momentum. The diversified assets of these Zacks Rank #3 (Hold) companies, long-term contracts and expanding infrastructure ensure they remain well-positioned to capture growth from America’s rising dominance in the LNG market.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Cheniere Energy: Being the first company to receive regulatory approval to export LNG from its 2.6 billion cubic feet per day Sabine Pass terminal, Cheniere Energy certainly enjoys a distinct competitive advantage. The company is primed for significant revenue and earnings growth on the back of solid operations and long-term contracts. Cheniere Energy’s Corpus Christi Stage 3 expansion is also progressing well, with construction 68% complete and Train 1 scheduled for initial gas introduction by the year-end. The company’s gas supply deals for its Sabine Pass and Corpus Christi projects offer excellent cash flow visibility in the coming years.

Shell: The company’s long-term strategy revolves around LNG. This London-based firm bought BG Group for $50 billion in 2016 to become the world’s largest producer and shipper of LNG. With LNG export demand likely to rise significantly in the near-to-medium term, Shell’s position as a major supplier of LNG should help it meet the fuel’s growing demand and improve cash flow. Shell’s exposure to this transitional fuel also offers a stable growth avenue within its diversified portfolio.

Venture Global: It is the second-largest exporter of natural gas in the United States. The company has developed a vertically integrated LNG supply chain, spanning production, transportation, shipping and regasification of natural gas. As the world shifts toward cleaner energy sources, LNG is expected to increasingly replace more carbon-intensive sources of energy, such as coal and diesel. The company is well-positioned to capitalize on the rise in LNG demand, partly driven by growth of data centers and the global shift toward the use of lower-emission fuels.

Chevron: This is another world-class operator of LNG. The giant Gorgon and Wheatstone developments in Australia are part of Chevron’s long-term strategy and are its flagship LNG developments. These mega projects allow the supermajor to tap the strong Asian LNG demand. Combined, these projects have an annual LNG production capacity exceeding 24 million metric tons. Chevron is the operator of both projects, with a stake of 64.14% in Wheatstone and 47.3% in the Gorgon development.

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