Ladies and gentlemen, good morning and welcome to the Cheniere Energy Third Quarter 2018's Earnings Call and Webcast. Today's conference is being recorded. At this time, I'd like to turn the call over to Randy Bhatia, VP of Investor Relations.

Thank you, operator. Good morning and welcome to Cheniere Energy's third quarter 2018 earnings conference call. A slide presentation and access to the webcast for today's call are available at cheniere.com. Joining me for today's call are Jack Fusco, Cheniere's President and Chief Executive Officer; and Michael Wortley, Executive Vice President and Chief Financial Officer. Before we begin, I would like to remind all listeners that our remarks, including answers to your questions, may contain forward-looking statements and actual results could differ materially from what is described in these statements. Slide 2 of our presentation contains a discussion of those forward-looking statements and associated risk. In addition, we may include references to non-GAAP financial measures, such as consolidated adjusted EBITDA and distributable cash flow. A reconciliation of these measures to the most comparable GAAP financial measure can be found in the appendix of the slide presentation. As part of our discussion of Cheniere Energy, Inc.'s results, today's call may also include selected financial information and results for Cheniere Energy Partners, LP, or CQP. We do not intend to cover CQP's results separately from those of Cheniere Energy, Inc. The call agenda is shown on slide 3. Jack will begin with an overview of recent commercial and strategic developments, a review of third quarter results and an update on construction and operations at our liquefaction projects. Following Jack's comments, Michael will review our financial results and discuss 2018, 2019 and run rate guidance. After the prepared remarks, we will open the call for Q&A. I'll now turn the call over to Jack Frusco, Cheniere's President and CEO.

Thank you, Randy and good morning, everyone. Thanks for joining us as we review Cheniere's results from the third quarter 2018, provide updated financial and operating guidance, and discuss some important developments we announced in our earnings release earlier this morning. I'm pleased to announce exciting commercial and strategic developments today. This morning, we announced a 24-year SPA with Polish Oil and Gas Company for approximately 1.45 million tonnes per year of LNG on a delivered basis through our marketing flagship, with delivery of a portion of that quantity to begin next year. Anatol is in Poland today celebrating with our newest long-term customer. I want to personally thank Anatol, Ramzi and the entire Cheniere team for another win. Execution of this SPA brings the total amount of contracted volume we have signed this year to over 6 million tonnes, with an average contract tenure of almost 20 years and expected aggregate notional revenue of nearly $50 billion. Our contracting success demonstrates the value buyers place on Cheniere's ability to provide reliable LNG solutions tailored to customers' needs. This morning, Cheniere also signed an EPC contract with Bechtel for the Train 6 expansion at Sabine Pass, locking-in cost and construction schedule. We are releasing Bechtel to do some early works to get Train 6 underway prior to our final investment decision. The process of releasing Bechtel under our limited notice to proceed our Corpus Christi Train 3 worked well and we expect that to be the case for Train 6 at Sabine Pass also. The third quarter was another great quarter for the company, as we generated $425 million in operating income and $569 million in consolidated adjusted EBITDA. Our strong quarterly performance was supported by steady and reliable operations at Sabine Pass and continued strength in LNG supply and…

Thanks, Jack, and good morning, everyone. This morning, I will review some highlights from our third quarter financial results, recap recent financing activity and provide some additional detail regarding our guidance. Turning to slide 9, for the third quarter, we generated operating income of $425 million, consolidated adjusted EBITDA of $569 million and distributable cash flow of $111 million. Our operating performance in the third quarter was in line with our expectations and our financial results were bolstered by stronger-than-expected marketing margins. As a result, we are raising our consolidated adjusted EBITDA guidance for the full year to $2.45 billion to $2.55 billion and our distributable cash flow guidance to $0.5 billion to $0.6 billion. Year-to-date, we have generated operating income of over $1.5 billion, consolidated adjusted EBITDA of over $2.0 billion and distributable cash flow of more than $470 million. We exported 228 TBtu of LNG from Sabine Pass during the third quarter, none of which were commissioning volumes. These volumes were slightly higher than our exports during the second quarter. During the third quarter, we had less maintenance spend during the second quarter (sic) [than during the second quarter], partially offset by some seasonality impact to production due to summer weather. Approximately 86% of the volumes exported during the quarter or 196 TBtu were lifted by our third party long-term SPA customers, and the remaining 32 TBtu were lifted by our marketing function. Incremental production volumes were lifted by our long-term SPA customers during the third quarter, with the Train 3 tranche of the BG SPA in effect for the full quarter. And marketing volumes were consistent with the second quarter. For the third quarter, we recognized in income 228 TBtu of LNG produced at Sabine Pass, consisting of 228 TBtu loaded during the third quarter, plus 3…

Thank you. We will now take our first question from Jeremy Tonet from JPMorgan. Please go ahead.

Good morning. Congratulations on...

Good morning, Jeremy.

Thanks. Congratulations, Jack, on expanding the size of the trains there. I was just wondering if you could dive in a little bit more as far as what you guys were able to do to accomplish that. And is this just something that is SPL or is this Corpus as well?

Yeah. So, Jeremy, thanks, by the way. As Michael said, the debottlenecking projects fall really into three categories. So, category one would be maintenance optimization, which is really trying to reduce our maintenance time so we can increase production, because it's all about production. Category number two I'd say is the reliability improvement, which is a real focus on extending that planned maintenance cycle. And if you can extend it and push it out, then you can produce more. And then the third bullet is just an all-out overdesign of the facility. So, when we add up those three brackets, if you will, and we look at the increase in production, we estimate that we could increase production by almost 4 million tonnes across the platform, which is fairly significant. It's almost a whole train at around $300 a tonne. So we're very excited about it. We're working on it now and we'll continue to work on it. And 2019 is going to be a big year for us to move this forward pretty significantly. And Mike, would you have anything to add on that? No? Does that help, Jeremy?

Thank is helpful. Thank you for that. And just want to turn to the guidance here. And it seems like the implied 4Q guide, if we're looking at that right, implies a slight tick down over 3Q at the top-end. Just wondering if there's any kind of headwinds in 4Q that we should be thinking about there? And the guide for 2019, just wondering any incremental color you could share with regards to shipping rates have moved up a bit, how you think about the price deck for your CMI assumptions there, is it kind of $2.50 assumptions you're thinking or anything else that you can share on those points?

Sure. Jeremy, it's Michael. So, with respect to Q4, no, we don't see really any significant change in Q4. So we said ever since Q1, which Q1 was a volatile quarter given Train 4, but ever since then we've been in a highly-contracted state. And so, delivering $550 million of EBITDA roughly for Q2, Q3 and expect that to be generally the case for Q4. And in terms of shipping, rates have moved up quite violently over the past three months. We have been really proactive on our shipping position. So we took down a lot of tonnage over the summer in anticipation of commissioning and having these three trains really in the CMI book until the FCD later this year. So I think we're a beneficiary of ship movement more than anything. So we're in a good position there.

Great. And anything else on the CMI assumptions in 2019 that you're willing to share?

Yeah. Generally, we want to – yeah, definitely. Generally, we want to kind of not talk a lot about our CMI position, given the competitive nature of it, but given that, it's going to be a huge piece of our business next year. And I'll say a little bit about it. So I think the marketing function is going to deal with about a little over 8 million tonnes next year in our budget, about 8.25 million tonnes. About 2 million tonnes of that will be commissioning, so non-P&L, so we'll generate a lot of cash from that. It'll just be an offset to PP&E. So, that gets us to about 6.25 million tonnes. And we've given you how we think EBITDA will change for a $1 move in margin. We've put away a fair amount of that 6.5 million tonnes, but still have a pretty large open position, which is a good thing given where prices are. So, yeah, that's how I would characterize CMI for next year.

Got you. So it sounds like there's some upside if you can pull these trains forward, the new ones, as you continue to do.

Definitely.

Absolutely.

That's all for me. Thank you.

We will now take our next question from Christine Cho from Barclays. Please go ahead.

Hi. Good morning. This is Marc on for Christine. In the past, you guys have voiced your preference for keeping DES contracts at the CMI level. With today's contract and I believe the CPC contract both being DES, how should we think about how the banks are going to view these contracts with respect to financing for Sabine Pass Train 6? Do you think they'll look through to see who's back in the CMI contract when thinking about the bank funding for the train?

I guess, on Train 6, I would say we signed the contract with Bechtel where we gave them limited notice to proceed. So we've locked-in budget and schedule at this point. So we're day-for-day on the guaranteed schedule, and we don't have to give them a full notice to proceed under that contract till the middle of next year. So your point is a good one. Ultimately, what contracts we give to Train 6 and show to the banks is kind of TBD. You're right, we'd prefer to keep the DES business at CMI. That gives us ultimate flexibility to deal with those obligations. But it's not out of the question that we wouldn't move some of those down if we didn't have standard FOB business to attach to them. So we'll see how that plays out over the next three or four months and then make a call ahead of next summer when we need to give it back the full NTP.

Got it. And so, just to clarify, should we think FID is predominantly a function of financing or are there other moving pieces there?

Sure. I mean, we'll need to put the financing in place. Like, I don't feel a ton of pressure to get that done again because we've let Bechtel go. But, again, we need to decide what we're going to do by the middle of next year and financing is certainly one milestone. We need to get sorted out kind of over in the next three or four months.

Okay. And then, just to clarify with your 2019 guidance, I think you mentioned that it assumes 2.5 million to 3 million tonnes of early cargo volumes. Just wanted to clarify, does that assume any early cargoes from Corpus Train 2? And should we assume a base margin of $2.50, as is typical in your projections?

So, yeah. The comment on 2.5 million, 3 million tonnes is the early cargoes associated with all three trains that are going to come on next year, with Train 5 and Train 1 in the first quarter, and then we have the Train 2 sometime in the second half. So, yeah, we're going to – and the DFCDs on all of those trains are six to nine months after the time they come on. In terms of margin, no, I don't think $2.50 is the number. Again, for the unsold piece of the marketing book, we're assuming more like $4.5 to $5 on the unsold piece, which is a little bit higher than what the screen would show you today and that's by virtue of our in the money shipping position. So, that's what we've assumed.

Okay. Great. Thanks.

We will now take our next question from Jean Ann Salisbury from Bernstein. Please go ahead.

Thanks. Good morning. What is your kind of ideal steady-state for the percentage of your cargoes that you're getting a long-term fixed fee for versus spot market price? And does that change kind of year-by-year I guess based on your view of the LNG market or is there a steady north star?

I didn't hear the first part of that.

Excuse me, Jean. Did you say the long-term steady-state?

Your ideal steady-state for kind of the long-term fixed fee versus spot market, now that you have a little bit more cargoes expected in your run rate.

I think having open capacity at the CMI business is a strategic advantage for us. So we don't ever want to be in a state where we're sold out in that business. And we've targeted 80%, 85% contracted, which that last 10%, 15% given the size of our platform is like 4 million, 5 million tonnes, which is a pretty good book for CMI to have to really tie early cargoes to long-term business and things like that. So we like that flexibility, it's part of our business and we intend to keep some length there.

And I would just add to that. Strategically, having those bridging volumes available that we can start our long-term customers or new customers, like the Polish utility that we announced this morning, is very beneficial to them and to us.

Yeah. I'd just add one more thing. I mean, our ability to sell without a condition precedent on building a facility is a competitive advantage that we have, right? So our customers don't take the risks that we have to get a project underway and we sell to them, and that differentiates us quite a bit.

That makes sense. Thanks. And then should we expect that most other U.S. LNG facilities would have kind of similar debottlenecking potential that you showed today, or do you view some of it as being specific to your site or design?

We have no idea what their design bases are or their reliability, and that's probably better to talk to them about.

Okay. Fair enough. Thanks a lot. That's all for me.

We will now take our next question from Danilo Juvane from BMO Capital Markets. Please go ahead.

Thanks, and good morning. Michael, if you could just repeat – I mean, I apologize for missing this in your prepared remarks, but what were the upside opportunities that you mentioned with SPL 5 and Corpus Christi 1 for next year?

The movement of the schedule, I think, is what he's asking.

In terms of schedule, so we have Train 5 making LNG in a Q1 substantial completion. So we're talking there about weeks' movement, so not that significant. Corpus hasn't made LNG but is very close to doing it and, again, we have that in Q1. So, again, I think that's weeks. There's probably more opportunity on Train 2 at Corpus, but let's see how Train 1 goes first. There may be a little bit more opportunity on Train 2.

Got it. And...

And did you mean the $200 million in increased EBITDA or EBITDA change for the substantial completion...

(29:17)

Yeah.

Correct.

That is purely a result of raising run rate production guidance.

Got you. Got you. And I guess with the ability to sign the contracts at least in Europe, obviously this is not an Asian customer, are you seeing now more appetite from European customers to be more willing I guess to sign contracts going forward here?

It's a combination of everything. So our business model is different. It's different than other U.S. LNG providers that are currently in construction. So we're a full-service provider, meaning we buy the gas, we transport it, we process it, we load it up on our ships and we'll send it right to your flange. And that's where we're seeing a big increase. So we mentioned CPC in Taiwan. We've mentioned Poland now. Those are delivered straight to their flange or straight to the utility. And in most cases, they go straight to a power plant and are used for power generation. So, having that full-service business model, having the bridging volumes that Michael talked about in the portfolio, it's a competitive advantage for us and we're just getting started. So, yeah, we're very busy, very excited about our opportunities going forward and the opportunity to continue to grow this business.

Thanks for that, Jack. Last question for me is on capital allocation. Obviously, you have a lot of potential upside in the guidance that you outlined for 2019. If you were just to look at 2019 guidance as you currently have it outlined, how would you think about what your capital allocation options could be next year?

Yeah. I mean, I think we'll talk about that after we get these two trains up and running. I mean, the good news is we thought we had $5.8 billion over the next five years and, with all the things I mentioned in the prepared remarks, we think that's 10% higher, closer to $6.5 billion. We're going to spend as much as we can on building more liquefaction trains. But I think we're going to have some leftover and we're going to talk to the market in the first half of next year about what we think the best use for that is.

Thank you. Those were my questions.

Yeah.

We will now take our next question from Matthew Phillips from Guggenheim. Please go ahead.

Good morning, guys. A follow-up on CMI's impact on 2019 guidance. I understand your reluctance to share your commercial position. But is the right way to think about it that the volumes you know you'll have from SPL would already be presold, whereas the commissioning – not the commissioning, but the pre-DFCD cargos from CCL 1 and SPL 5 would be floating with the curve (32:26)

Definitely. Yeah. We don't – well, I said commissioning is kind of 2 million tonnes next year on the high-end. And yeah, we don't sell those until we know we have them. So, those will be purely market-based. The balance of the portfolio, which I said is 6 million tonnes, I mean, you don't go into a year having not put any of that away. So we sold some of that earlier this year and continue to do so at present in a rising price environment. And so, I'd say a fair amount is still not sold. All of the commissioning is unsold and then a portion of the book is put away given the amount of volume for next year.

Understood. Thank you. And then, with regard to long-term contracts, I mean, what would you estimate is the range for clearing prices for new off-take and what's kind of driving that in one direction or the other?

Do you want to talk about prices and long-term contract? I mean, it just depends. It depends on who you're talking to and where they're located, but it's a very competitive market out there. And as you see from LNG Canada and some in the Qataris and the Russians, that everybody's got big plans to expand and grow. So I'd rather not talk about prices on the call, but you should rest assured that we're doing our part here for America and for U.S. LNG to continue to grow our business. And that's been our focus in making sure that it meets all of our financial hurdles to our shareholders.

Right. I mean, on that note, that's really what I'd focused on. We've said we're investing at 6 times EBITDA kind of ratio, that's what we did on Train 3 as we think Train 6 will look like and more like a 3, 4 times on an equity to cash flow basis. So we're not getting into the top – what's driving the top line, those are the investment hurdles we're trying to reach, and again, on a heavily contracted basis.

Understood. Thank you.

Thanks, Matt.

We will now take our next question from Craig Shere from Tuohy Brothers. Please go ahead.

Good morning. Congratulations on the fantastic news this morning.

Thank you, Craig.

So, for Corpus Christi Train 1 early completion, are you potentially more open on originally hedged feedstock gas cost there, such that for time you can benefit from wider basis differentials?

Sure. There'll be some opportunity there. Yeah.

Okay. And kind of turning that line of questioning forward, obviously, Phase 3 of Corpus Christi, that is going to have full regulatory approvals in the not too distant future with 9.5 mtpa of capacity is potentially more advantaged than Sabine's location. And I'm wondering if you're talking about a formal FID by mid next year, and I guess you're doing prep work right now and I understand that, but why wouldn't we be thinking about turbo-charging Phase 3 at Corpus ahead of Sabine 6?

Well, first off, you all should assume that we're not slowing down. So it's been a extremely productive year in 2018 and I see that going forward in 2019. So it is our goal to continue to expand the business. And this is going to be an easy capital allocation discussion if we continue to be as successful as we have been, because tie (36:21) goes to growth and we're going to be just investing back into our core business. So the other part of it is, while we are very pleased with the FERC schedule on the review of the permits for Stage 3 at Corpus, which is our mid-scale project, timing-wise our customers need LNG now and we've got to take advantage of that. We have a shovel-ready project. We have construction forces that are going to be rolling off the Train 5. There's a lot of synergies that Bechtel has given us in cost reductions, et cetera, by being able to roll that team right into Train 6. So I would expect that we continue to win our fair share of these contracts and we continue to grow the business and we move right into the next round of growth and that growth is going to be back at Corpus after Train 6.

Yeah. I don't it's an either/or proposition on either of them. And your original question on Corpus, absolutely a better place to be right now from a gas supply standpoint. Permian Highway and Gulf Coast Express are each being built directly into our existing infrastructure to feed us. So it's really a great place to be from a supply standpoint.

Great. And last (37:46) question for me. Without getting into details on specific price points for long-term contracting, couldn't help but notice that some of your press release disclosures this year on new SPAs, some referenced Henry Hub plus a fixed component, and some referenced just Henry Hub plus a fee. And then CPC in Taiwan had said that there was some gross very large price point all-in, obviously, to promote the idea of trade. But the question is, does some of your contracting entail some liquefaction fees that can float for a little bit in the curve against some index?

We didn't mean to – we weren't trying to trick anybody on the language change. I mean they're pretty standard contracts with significant fixed fee components. There is a case or two where we share in some upside, but still the fixed fee component is still the dominant factor in the contract, not in any other contracts that you mentioned with respect to profit shares, but there are one or two.

Great. Thank you.

We will now take our next question from Alex Kania from Wolfe Research. Please go ahead.

Thanks. Just a question on just the overall kind of market environment right now. I mean, in the last probably few weeks, we've seen a flurry of contracts and MOU announcements. So, just kind of curious as to how you'd characterize what you're seeing in long-term market discussions right now just from buyers and maybe kind of are you seeing maybe elevated competition from these projects right now? Just kind of curious on that.

Yeah. So, the good news is natural gas demand continues to increase worldwide, especially in Asia. So it goes well beyond just China. You have China, Korea, India, Pakistan, all increasing significantly year-over-year its LNG imports. And so, yeah, we've been extremely busy. The team has been trying to craft solutions for different customers around the world. And I think in the forecast that I have seen, whether it's WoodMac or others, there's a significant shortfall in the LNG supply outlook. So, the shortfall is well over 100 million tonnes even today, even with some of the announcements worldwide of others that are trying to expand or grow. So I do think there's a huge opportunity for us that the winds are at our back and we just need to continue to execute. And, Michael, do you have...

I mean, we're coming out of a historic low in FIDs due to this last down cycle. And so I think the market is just scurrying to kind of catch up. So, even in 2025, there looks to be a 70 million, 80 million-tonne opportunity. And, of course, you've got to get going on that from a construction standpoint in the next year if you're going to hit that window. So I think that's what's driving a lot of this market activity.

Great. Thanks, guys.

Yeah.

We will now take our next question from Julien Dumoulin-Smith from Bank of America. Please go ahead.

Hey. Good morning, team.

Hi, Julien. How are you?

Good. Good. Thank you. Well, Jack, I wanted to turn the tables back to this capital allocation question. I know you mentioned on the call in the prepared remarks about turning to this in 2019. But knowing you, you have a penchant for talking about buybacks at times. How are you thinking about this business and whether buybacks versus dividends make more sense? Obviously, you've got a very stable source of cash flow here. You've now priced or presumably have visibility on the overall cost of SP6, given the context that you provided this morning with Bechtel. Can you at least initially give us some thought process on the merits of one versus the other particularly turning to 2019, and maybe as you think about the evolution of the business from 2019 to 2020 to 2021 kind of? Maybe what else needs to happen to get there?

That is a loaded question. But if the stock keeps staying exactly where it's at, I'm all for buybacks if that's what you're asking me. It's going to be a very short capital allocation discussion with the investors. But as Michael pointed out, there's a whole lot of cash that this business is going to generate. And with the stability of our contracts, there's going to be a great opportunity for us to try to get that cash back to the investors. And we're going to figure out, Julien, what to do here, as Michael said, in this first half of next year and be able to communicate it. And we're looking at the most tax-effective, efficient way to get it back to our investors. And that's about all. But you know my history from Calpine in the past and I'm a big advocate of making sure we get this capital allocation done right up front and be able to communicate to everybody appropriately.

Got it. Excellent. And actually, to that point, on SP6, just to make sure we hit it here, I mean, what is the pricing on a per-tonne basis and what kind of advantage did you get given that the efficiencies you alluded to and getting ahead of it before FID here, if you can talk to it more precisely?

Yeah. I mean, it's going to look a lot like Train 3, and Train 3 had a lot of synergies associated with the work we did on Trains 1 and 2, and we did a lot of work on Train 5 in anticipation of Train 6. So, all the utilities are all in for Train 6. So it's going to be really competitive. The EPC contract in the $500 kind of or lower range and all-in high-$500, $600-a-tonne type number.

Got it. And Jack, just to clarify your comment, that means execution in 2019 when you say talking about capital allocation?

Well, I mean, we're already doing it, Julien. If you look at the amount of cash that we need to put back into our business for our existing growth on these trains, so if we FID Train 6, you should expect that there is a significant amount of cash in 2019 that's going to go plowed back into our business for growth. So, yeah, I mean, we're doing it now.

All right. Fair enough. Thank you.

Okay.

We will now take our next question from Hillary Cacanando from Wells Fargo. Please go ahead.

Hey, guys. It's actually Mike Webber on for Hillary. Hi, guys. How are you doing? So, logistic of (45:17) dialing in from the road. I wanted to look back I think maybe the first question that dealt with freight. Obviously, rates have kind of gone parabolic here you guys got ahead of that in June. But I'm just curious with the expanded production and capacity you guys are talking about, was that factored in to the budgeting and the cargo program you guys went out and kind of captured in June? And to what extent are you fully covered for 2019?

Yeah. I mean, again, I guess we'll break our rule on our position. But, yeah, we took down all the tonnage we need for the three trains that are going to be early. So we're in the low-20s in terms of vessels right now, will rapidly be in the low-30s, and all of that was contracted this summer.

Right. Okay. So the expanded production and the early trains, you guys are covered for 2019.

Yes.

Yes.

All right. I appreciate that. And then just more broadly on commercial progress. Jack, I think you mentioned some of the progress you guys are seeing, from the sense of competition you guys are seeing around Stage 3 in Sabine 6. The last couple FTAs and lots of FIDs really, you guys have kind of had a little niche, kind of little air pocket here, where I mean you're probably consistently competing with Qatar but some of your big larger global projects are still kind of getting their legs under them. Do you think the competitive subset for Corpus Phase 3 ends up being materially different than Sabine 6, or maybe you have the market a little bit more to yourself? Or do you think – are you bumping into...

(47:19)

...Mozambique, Canada LNG, (47:24)? Is that happening now or is it just Asian process or something with (47:26) FTAs so long that you're not really going to bump into them and earn (47:32) until initially you start going after Corpus Phase 3?

No. No. You should assume we're going after Corpus Phase 3 now. We're not waiting. It's not a binary marketing strategy. But it's extremely competitive worldwide. And so, yeah, I mean we're seeing everybody out there. I'd expect we're going to continue to see people out there as they're trying to get to FID themselves, so.

Yeah. I guess my question is some of those are more high profile global projects, are you competing with them now or are they still yet to come to the table?

No. I mean, we're competing with them now. I mean, look at like – the people want diversity in their portfolio, so keep that in mind. I mean, look at the Taiwanese, I mean, they're going to have some Mozambique off-take, they want some Gulf Coast off-take, and we want that part of the business. The Polish, another perfect example, they have a big deal with the Qataris already. They want to buy from the U.S. in addition to that. So, in that case, we don't really compete with the Qataris because they've already bought from them. So, people want to buy – big buyers want diversity in their book and when they look to the U.S., they're looking to us right now.

Okay. Thank you. And just one follow up on that. Polish FTA, did they actually sign another FTA earlier this year with a greenfield competitor, to use it in liberal terms, a liberal sense? And when we look in terms of volumes that have been coming out of Sabine, it seems like there's a bit of a shift towards Europe, which would make sense from a global dynamic perspective. Are you seeing that? If you look at your backlog of conversations around new business, without getting too granular, are you seeing any kind of moderate shift towards a bit more of a European focus?

Yeah. I would say – and unfortunately, Mike, Anatol is not here with us and he's much more eloquent at the markets. But I would say that we are very excited about the fundamentals that we're seeing going on in Europe right now, whether it's carbon pricing or just the opportunities in Europe all the way around, so.

Okay. Fair enough. Thanks.

(50:04)

We will now take our next question from Fotis Giannakoulis from Morgan Stanley. Please go ahead. Fotis Giannakoulis - Morgan Stanley & Co. LLC: Yes. Good morning, gentlemen, and congratulations for your announcements today. Jack, I want to ask you about the competitive landscape. You mentioned earlier about LNG Canada and Qatar. These two projects and producers, they took FID without having specific off-takes. If you see this becoming a trend in the future, if you would consider potentially expanding further on new trains without specific off-takes? And whether this mean the LNG Canada FID for North American producers, especially for the greenfield projects?

Yeah. So, Fotis, if you're asking would we make a shift in our business strategy to go from a contracted portfolio to a merchant portfolio, I have to tell you, I spent my first 40 years in the merchant power business and it didn't feel good. And so, that's not high on my list right now. Right now, we are totally focused 100% on customers and new customers and what their needs are and how we can meet their needs. And as you know, in the utility business, right, our customers are making long-term bets. So, whether it's China where they've got 10 million tonnes of additional regas got built year-over-year and they've got 25 million tonnes of regas that's under construction right now, they're spending real money to build real infrastructure, or Taiwan with the 5,000-megawatt combined cycle power plant that needs fuel. And they need us, they need affordable reliable energy, and that's really what our focus is. It's not to build for build sake. And in Cheniere line, we don't talk about scale or being big, we talk about adding value for our customers and for our shareholders. Fotis Giannakoulis - Morgan Stanley & Co. LLC: Thank you, Jack. And what I was trying to get is whether you would consider of building first and contracting later in an effort to go ahead of the competition, similar to what it seems that the oil major or some of the Qataris are doing and if that makes it harder for smaller players or greenfield players as they are trying to enter the market right now.

No. I mean, I think it's the opposite. We contract now and build later. I mean, given our lengths, we sell off our length and refill it with new construction. So I think we just keep doing that. Fotis Giannakoulis - Morgan Stanley & Co. LLC: Okay. Thank you. I appreciate it.

And, Fotis, you'll have to ask the other greenfield LNG folks if it makes it harder for them or not. Fotis Giannakoulis - Morgan Stanley & Co. LLC: Thank you, Jack.

We will now take our next question from Michael Lapides from Goldman Sachs. Please go ahead. Michael Lapides - Goldman Sachs & Co. LLC: Hey, guys. One quick one. Just curious now that you've gotten CQH squared away and closed, how are you thinking about future changes to the corporate structure, including anything if possible at all with CQP?

Do you want to...

Yeah. I mean, it remains an opportunity for us. We don't really feel like there's much to do right now. You see all these rollups happening in the market and most of those have real issues with their MLP, right? And we don't feel like we have that issue and we haven't made distribution promises that we can't keep. We don't have a funding problem down there and we have cash flows to reinvest. And so, really it'll come down to a value decision for us. We don't think it makes sense to have two boxes with the same businesses basically in it. But the rollup is purely a value proposition for us. Michael Lapides - Goldman Sachs & Co. LLC: Got it. And then another longer-term question. You obviously raised the export capacity potential for the trains you have now and the ones you're bringing on line in the next couple of years. Just curious, when you think about the Corpus site, how do you think about what the total potential size in tonnes per year could be coming out of Corpus now? And I know this is really long-term, so I'm thinking about all of the acreage you control there and the infrastructure you control there. I'm just trying to get my arms around how big this could be in kind of a blue sky scenario.

I think we can double the size of the company, quite honestly, at that site. Michael Lapides - Goldman Sachs & Co. LLC: Double from today's run rate or double from your 2021, 2022 run rate?

The way I think about it from today, from the trains that we're currently building or that are operating. So, I think there's probably another 30 million tonnes at Corpus that can be built in addition to Train 3. Michael Lapides - Goldman Sachs & Co. LLC: Got it. Thank you, Jack. Much appreciate it.

All right, Michael. Thank you.

We will now take our next question from Spiro Dounis from Credit Suisse. Please go ahead. Spiro Dounis - Credit Suisse Securities (USA) LLC: Hey. Good morning. Sorry if this was covered. I hopped on a bit late. But, first one just on potential indexation, maybe hard for you to answer just from your side of the aisle, but do you have a sense for how close you guys are to being included in the S&P and maybe what you think it would take to get there from here?

Spiro, hey. It's Randy. I've had those conversations with them. It's really not anything that we can just go and do. Some of the issues that were keeping us out, namely their requirements for certain financial metrics, those we're correcting as we speak. So I think we're a reasonable candidate for inclusion. But in terms of us getting in, it's really difficult to know. Spiro Dounis - Credit Suisse Securities (USA) LLC: Okay.

They just took out – they made a change last night. Obviously, we want a part of it. But they removed EQT and brought in a non-energy company in its place. So, there's some probably index construction things that they are trying to accomplish as well. But we think we're a reasonable candidate and we do what we've laid out here I think we'll be in at some point in the future. Spiro Dounis - Credit Suisse Securities (USA) LLC: Okay. And then maybe continuing along that context there, just how you guys view yourselves relative to large cap energy peers and tying that to the dividend yields, and I realize you can't give specifics, but is it fair to look at other large cap energy peers and their yields that are in the index and say you guys at least want to comp to that?

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Yeah. A lot goes into that answer I guess. I mean, that's one way of looking at it. But I think we'll hold off until next year and clarify all that. Spiro Dounis - Credit Suisse Securities (USA) LLC: Yeah. I totally understand. Appreciate the time.

We will now take our next question from Ryan Levine from Citi. Please go ahead.

Hi. Can you comment on the contract duration negotiating environment, given the recent 24-year contract that Cheniere signed with Poland?

Yeah. So, Ryan, as you could tell, we've been very successful at continuing to negotiate long-term contracts with our counterparties. Again, it's because they're building infrastructure and they need to have an affordable, dependable supply of fuel for that infrastructure. And since we're full service and we're delivering straight to the utility's doorstep, they are willing to sign up with us and, quite honestly, pay a premium for those services. So we haven't found a need to change our business model at all in regards to our pricing structure or term or tenure of those contracts.

Okay. And then one follow-up. How would you look at contracting the new volumes that the operational improvements are enabling? Is there any seasonality to that average increase in volume per train across your portfolio?

It should actually smooth out some of the seasonality when we are complete with some of the debottlenecking initiatives for us. But we look at our output or production as a portfolio. So it's not by individual train or it's not even by site. We try to manage the business as a portfolio. So, as we get more production available, we'll look to term that up and get some stable cash flows from it. And we think that's what the biggest reward will be from our investor base.

Thank you.

We will now take our next question from Jason Gabelman from Cowen. Please go ahead. Jason Gabelman - Cowen & Co. LLC: Yeah. Hey, guys. How is it going? Two questions for me.

Hey. Jason Gabelman - Cowen & Co. LLC: First of all, on the unsold marketing component for next year, you had mentioned the marketing margin you're planning for is $4.5 to $5 per M, which is as someone said a bit higher than the $2.5 you've historically used. Is that a number that you use in your run rate guidance as well and what is driving that higher margin realization?

Yeah. We've always assumed at least for the past couple years, several years, $2.50 in our run rate number. So we're not using current market conditions to say that's what we're going to make in two, three, four years. We have never used $2.50 in our current plans, right? We do mark that to market and that's what we've done here for 2019. Jason Gabelman - Cowen & Co. LLC: Got it. And then just on your CapEx spend. It looked like it jumped up this quarter from about $700 million to $1.2 billion. It looks like there wasn't as high of a corresponding increase for the terminal and construction bucket on your balance sheet. So is there a CapEx being spent on, I don't know, something outside the business or is it just an accounting issue for the quarter?

Yeah. I hope it's not an accounting issue. And I'm not aware of spending anything else than our terminals. So I don't know. Randy, I have to get back to you on that discrepancy. But Corpus Train 3 has ramped up for the quarter. So, that probably is why we're spending more. The difference, we have to get back to you on. Jason Gabelman - Cowen & Co. LLC: All right. Great. Thanks a lot.

We will now take our final question from Ben Nolan from Stifel. Please go ahead. Benjamin Joel Nolan - Stifel, Nicolaus & Co., Inc.: Yeah. I made it in. Great. And I really only have one question left. I know you guys talked some about the bridging volumes and obviously that probably increases through some of the debottlenecking work that you've done. I was curious if you can kind of put a number of how much you sort of view as available as bridging volumes to try to increase your competitive advantage in winning new SPAs? From where you sit right now, how much would you call in that category of leverage volumes?

It's typically been 3 million to 5 million tonnes. And right now, it's lower than that because of all the DES business we've done. But as we said, likely, reload the portfolio as we build Train 6. Benjamin Joel Nolan - Stifel, Nicolaus & Co., Inc.: Okay. So, I guess this debottlenecking, it didn't materially add, I guess, or it was offset by the recent SPAs, I guess is how to think about it.

Let me clarify. When the DES business starts in earnest, which is still three, four years out, the 4 million tonnes that our marketing business has, that's what will be utilized. Between now and then, they still have a lot of length to offer to customers in the bridging market. The debottlenecking will absolutely supplement that and has with this latest announcement. Benjamin Joel Nolan - Stifel, Nicolaus & Co., Inc.: Okay. All right. That'll do it. Thank you.

Thank you, all, and thanks for your support of Cheniere. We really appreciate it.

Ladies and gentlemen, this concludes today's call. You may now disconnect.