Good day, ladies and gentlemen, and welcome to the Cheniere Energy Q3 2022 Earnings Call and Webcast. Today's call is being recorded. At this time, I'd like to turn the conference over to Randy Bhatia, Vice President of Investor Relations. Please go ahead.

Thanks, operator, and good morning, everyone. Welcome to Cheniere's Third Quarter 2022 Earnings Conference Call. The slide presentation and access to the webcast for today's call are available at cheniere.com. Joining me this morning are Jack Fusco, Cheniere's President and CEO; Anatol Feygin, Executive Vice President and Chief Commercial Officer; and Zach Davis, Executive Vice President and CFO. Before we begin, I'd 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 risks. In addition, we may include references to certain non-GAAP financial measures, such as consolidated adjusted EBITDA and distributable cash flow. A reconciliation of these measures to the most comparable GAAP measure can be found in the appendix to the slide presentation. As part of our discussion of Cheniere'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 operating and financial highlights, Anatol will then provide an update on the LNG market, and Zach will review our financial results and guidance. After prepared remarks, we will open the call for Q&A. I'll now turn the call over to Jack Fusco, Cheniere's President and CEO.

Thank you, Randy, and good morning, everyone. Thanks for joining us today, and thank you all for your continued support of Cheniere. I'm pleased to be here this morning to highlight our third quarter 2022 results and achievements and discuss our positive outlook for the remainder of this year and into next, all of which continues to demonstrate Cheniere's market leadership and excellence throughout our business. Since our capital allocation update in September, we have remained laser-focused on our operations, ensuring reliable LNG production and supply for our customers amidst global energy shortages and challenges. In fact, just last week, we had a daily production record for the company, producing well north of 7 TBtu of LNG and also a daily record at Sabine Pass of approximately 5 TBtu of LNG. My congratulations to the Cheniere professionals for a job well done. Additionally, in conjunction with Bechtel's Engineering and Construction, we are off to a great start at Corpus Stage 3. We have rolled up our sleeves, hit the ground running, and have already seen some early signs of potential acceleration on that project. Across the LNG market, volatility continues to dominate, driven by short-term supply-demand pressures. Recently, from record-breaking warmer weather, near-term prices have retreated from the highs we saw barely 2 months ago. Nevertheless, we are largely insulated from these price swings, given the highly contracted nature of our business, and we remain focused on long-term value creation as our priority with short-term market dislocations only serving to accelerate our long-term plans, as you heard from me and Zach in September. Now please turn to Slide 5, where I will review some key operational, financial, and strategic highlights from what was yet another very successful quarter. For the third quarter, we generated consolidated adjusted EBITDA of approximately $2.8 billion and distributable cash flow of approximately $2.0 billion as margins in the LNG market remained significantly above historical norms and our focus on execution and our operational excellence program continued to be rewarded. Today, we are reconfirming our full year 2022 EBITDA and cash flow guidance, both of which were recently increased by over $1 billion when we announced our capital allocation plan in September. In transit LNG shipments and commodity price volatility increased the degree of difficulty in pinpointing the forecast, but we are tracking to the upper half of the EBITDA and DCF ranges currently. Later on this call, Zach will provide you with a few early data points on how 2023 is shaping up ahead of providing full year guidance on our February call. As we've discussed, the reliability of our LNG operations is more critical than ever, given the volatility present in today's market. During the third quarter, we produced and exported 156 cargoes of LNG from our facilities. Of that, approximately 70% of that volume landed in Europe. By comparison, during the third quarter of last year, less than 30% of the volume produced by Cheniere landed in Europe. Not only does this shift underscore the value of our destination flexible LNG, which can quickly respond to market signals to reach end users of the greatest need, but is also providing meaningful energy volumes to Europe at a time when the region is facing significant challenges. The fact that these challenges could persist for a number of years has hastened a renewed focus on the criticality of energy security as governments and utilities the world over advance strategies to mitigate energy supply risks for the long term. Anatol will provide further insight into the current market dynamics in a few minutes. During the quarter, we announced our 2020 Vision capital allocation plan, a revised comprehensive long-term capital allocation plan designed to maintain investment-grade credit metrics through cycles, further return capital to shareholders over time, and continue to invest in accretive organic growth. The plan envisions $20 billion of available cash through 2026 and over $20 per share of run rate distributable cash flow. Zach will review some of the key features of the plan in a few minutes. But we believe our new 2020 vision is an excellent capital allocation framework for our stakeholders, and the plan follows our significantly accelerated execution under the long-term capital allocation plan we implemented just over a year ago. Before moving on, I also want to highlight an important organizational announcement I made during the quarter. Organizational clarity and operational excellence are two of my key priorities. And as Cheniere has grown and evolved, so too must our organization in order to maintain an incredibly high operating standard we have set for ourselves. In September, we announced the promotion of Corey Grindal, currently Executive Vice President of Worldwide Trading in London, to serve as Cheniere's inaugural Chief Operating Officer, effective January 2023. Corey has been at Cheniere for nearly a decade, and his leadership and contributions have been an integral part of building the exceptional operating platform we enjoy today. Prior to his role overseeing Worldwide Trading in London, Corey was SVP of Gas Supply and was the architect behind Cheniere's gas procurement program, which today is one of the largest holders of pipeline capacity and purchasers of natural gas in the United States. We look forward to Corey's continued leadership as COO, building upon our safety-first culture and reputation as a leading reliable supplier of LNG in the world. I'm pleased to welcome Corey back to Houston in his elevated role as COO. You all will begin to hear from Corey directly as he participates in investor conferences and these earnings calls next year. Turn now to Slide 6. I'll give you a brief update on construction and execution across our Sabine Pass and Corpus Christi sites. First, last week, commissioning was completed for the third marine berth at Sabine Pass. And consistent with our track record, the third berth achieved substantial completion ahead of the guaranteed schedule and within project budgets. The third berth will not only provide increased flexibility to our marine loading operations, particularly during suboptimal conditions like fog events, but also serves as a brownfield infrastructure that we can economically leverage as we develop our expansion plans at Sabine Pass. Now moving to Corpus Christi Stage 3. As I mentioned before, we are off and running and the project is making excellent progress. Inclusive of the early limited notice to proceed we utilized at the start of the year, we've invested approximately $1 billion to date of Stage 3. The LNTP not only provided cost benefits, enabling us to lock in prices early, but also provided some significant construction schedule advantages with early site work, such as the installation of key infrastructure. Long lead time equipment orders have been placed with suppliers, and key equipment manufacturing is expected to start before year-end. We recently held a groundbreaking ceremony at the Stage 3 site, and it was exciting to see such overwhelming support for the project across a broad spectrum of stakeholders who help make the project possible from regulators, government officials, long-term customers, EPC and equipment providers, banks and, of course, our employees. As we work towards first LNG from Stage 3 in late 2025, I look forward to upholding Cheniere's stellar reputation on safety and execution and partnership with Bechtel. Thank you all again for your continued support of Cheniere. I'll now turn the call over to Anatol, who will provide an update on the LNG market.

Thanks, Jack, and good morning, everyone. Please turn to Slide 8. Despite it being a shoulder season in many regions, the turbulence in the global gas and LNG markets continued throughout the third quarter with only a few brief stretches of stability. While geopolitical conflicts and the related curtailment of Russian gas flows are largely responsible for supply shock in Europe this year, we believe that some cyclical dynamics also played a role in laying the groundwork for today's market conditions of elevated prices and volatility. In fact, we've signaled for some time that the rate of new liquefaction capacity coming online would decelerate significantly during the 2020 through 2024 period, given the lack of FIDs taken in the years prior. As you can see on the chart to the left, we estimate current capacity growth rates to be near 2%, a level not seen since 2012 when the market was also out of balance and prices clearly signaled the need for new LNG capacity. As a result, given the long lead time required to develop LNG projects, we expect market balances to potentially remain tight for the next several years, exacerbated by the crisis in Europe and the reduction of Russian supply to the European market. As shown in the middle chart, LNG imports from the U.S. have been the primary resource to offset the removal of over 50 Bcm of Russian gas imports from the European market this year, further reinforcing Jack's earlier point on the ability of U.S. LNG to respond quickly to market signals. As the primary source of global LNG supply growth for the past 4 years, the U.S. has surpassed Australia and Qatar to become the world's largest supplier measured by installed capacity this year, and this growth could not have come at a more critical time for Europe, given that inherent destination flexibility. The U.S. has become Europe's top LNG supplier, and Cheniere's facilities at Sabine Pass and Corpus Christi have been significant contributors to this growth, helping provide secure and reliable natural gas supply to the European market, which I will detail further in a minute. Despite the steady increase in LNG flows to Europe, TTF continued to rally in the third quarter, hitting an all-time high of about $99 per MMBtu in late August, as concerns surrounding adequacy of supply reached new levels. Since then, TTF prices have come off considerably, settling in October at about $54 in MMBtu, despite no sign of Nord Stream flows resuming. JKM prices have traded at a discount to TTF for much of this year as European buyers have kept netbacks higher into the region compared to Asia in order to fill storage ahead of winter heating demand. In the U.S. Henry Hub prices have generally dropped since late August, settling in October at $6.87 in MMBtu as temperatures and forecasts moderated and gas production continued to rise. Let's now turn to Page 9 to address regional dynamics in more detail. As I just mentioned, Europe has been utilizing LNG to try to offset as much of its gas supply deficit related to the Russian gas cuts by increasing its LNG imports by 65% this year with approximately 87 million tons imported through the third quarter, making 2022 an all-time high year for LNG imports into Europe. Imports from the U.S. represented 44% of that total. In fact, Cheniere alone was responsible for approximately one-fourth of Europe's LNG imports this year. As the top middle chart illustrates, U.S. LNG volumes surged over 200% year-on-year in the third quarter as Nord Stream flows came to a halt by the end of the quarter. Nevertheless, the European market appears well prepared for winter as shown with storage levels exceeding their 5-year average on the back of milder weather, some level of industrial demand management, and aggressive buying by European utilities. As such, we have recently seen prices moderate as the market waits for winter demand to kick in. We've also seen the congestion at certain European regas terminals continue to grow, once again, evidencing the need for development of additional import capacity and related infrastructure in order to provide relief and allow greater volumes of LNG to access the market, particularly in Northwest Europe. Fortunately, the new Eemshaven import terminal in the Netherlands recently began operations. The terminal, one of the few FSRUs expected to start in Europe in the coming months, received its first cargo in September, which was produced and delivered from our facility at Sabine Pass. In Asia, LNG imports declined by 14.5 million tons year-to-date with nearly 5 million tons of the decline realized in the third quarter. Ninety percent of this decline is attributable to China as a result of reduced industrial sector demand and weak gas burn, which could remain a trend throughout this winter. In China, industrial gas demand decreased by 3 Bcm in the third quarter, representing an 8.7% drop year-on-year, and low hydro levels supported thermal use in power generation, with coal generation increasing by 11% year-on-year in the third quarter, while gas grew only 4%. However, overall gas-fired power generation dropped 8% year-on-year from January through September as high spot LNG prices and robust renewables generation in the first half of the year disincentivized domestic use and actually encouraged cargoes to be redirected to Europe. Much of the demand growth in Asia in the third quarter occurred in Thailand, Japan, and Taiwan as a result of inelastic consumption needs. As we mentioned in previous calls, Thailand continues to call on LNG to supplement dwindling domestic gas production. Japan plugged a 2.7-gigawatt deficit in nuclear availability in the third quarter and Taiwan continues to offset the decline in coal generation. Let's move to Slide 10. Last quarter, we discussed LNG contracting trends and the growing commercial success that U.S. projects were garnering. That contracting momentum continued in the third quarter, reaching a total of 40 million tons per annum of long-term transactions signed with U.S. projects year-to-date through mid-October, highlighted by our long-term deals with PetroChina and PTT. As you can see on the left chart, the aggregate volume is approximately 80% higher than what was signed in all of 2021 and represents more than 75% of global contracts signed year-to-date. In fact, the first 9 months of 2022 alone make 2022 a record year for U.S. LNG contracts signed. This commercial success is owed largely to several key advantages of U.S. LNG: destination flexibility, competitive and stable pricing, a mature upstream and midstream footprint, and time to market. These advantages, coupled with elevated market prices, have provided tailwinds for the development of additional LNG capacity in the U.S. However, most of those U.S. projects still have yet to make FID, given the rigorous commercial, financial, regulatory, and technical hurdles projects are required to overcome in order to raise financing and move forward with construction. And those hurdles are only getting higher given the volatility, inflation, and rising interest rates. For our part, as we discussed last month, we plan to continue to pursue growth of our 55 million-ton platform, starting with our near-term plans to add approximately 5 million tons per annum via the CCL Trains 8 and 9 mid-scale project and some debottlenecking at Stage 3 along with the long-term potential to add an incremental 30 million tons per annum of volume across our two sites. Volume that will continue to ensure security of supply and sustainable economic growth for our long-term customers and end-use communities. We're hard at work on these opportunities, and we'll keep you informed on them as they achieve project development milestones. And now I'll turn the call over to Zach to review our financial results and guidance.

Thanks, Anatol, and good morning, everyone. I'm pleased to be here today to review our third quarter 2022 financial results and key financial accomplishments, all of which continue to reflect our team's tireless efforts to ensure safe and reliable operations and seamless execution throughout this period of prolonged volatility in the global energy markets. Turning to Slide 12. During the third quarter, we generated adjusted EBITDA of approximately $2.8 billion, distributable cash flow of approximately $2 billion, and a net loss of approximately $2.4 billion. Our third quarter results once again were supported by the sustained higher margin environment across global gas and LNG markets. Higher lifting margins due to higher Henry Hub prices across the quarter and incremental margin achieved from certain portfolio optimization activities. Our quarterly results were achieved despite a couple of CMI cargoes moving into Q4 from Q3. In addition, in the third quarter, we recognized a portion of the payment from Chevron related to the early termination of the regasification TUA, which we expect to receive before year-end. We recognized 560 TBtu of physical LNG during the third quarter, including 556 TBtu produced from our Sabine Pass or Corpus Christi projects and 4 TBtu sourced from third parties. Approximately 82% of these LNG volumes recognized in income were sold under long-term SPA or IPM agreements with terms greater than 10 years. Once again, the net income line continues to be impacted by the unrealized noncash derivative impact related to our long-term IPM agreements, as we have discussed on prior earnings calls. In the third quarter, we recognized $4.9 billion of these unrealized noncash losses attributable to the continued growth of LNG margins and commodity price volatility. As a reminder, because GAAP requires mark-to-market accounting of these long-term gas supply agreements, but does not permit the mark-to-market of the associated and offsetting sale of LNG, it results in a mismatch of accounting methodology for the purchase of natural gas and the corresponding sale of LNG, which drives this quarterly variability in net income from period to period. That is why we would expect as margins stabilize and price volatility subsides over time that these unrealized noncash derivative moves will become much less pronounced in our quarterly results. Thanks in large part to the significantly accelerated progress on our capital allocation plan announced in September of 2021. During the quarter, we rolled out our revised long-term capital allocation plan. Our 2020 vision of over $20 billion of available cash through 2026, as well as over $20 per share of run rate distributable cash flow. Built upon the foundation of our previous plan, this plan is designed to achieve and maintain investment-grade metrics through cycles, further return capital to shareholders over time, and continue to invest in accretive growth beyond Corpus Christi Stage 3. As part of the revised plan, we increased our share repurchase authorization by $4 billion for an additional three years, beginning October 1, 2022. Lowered our consolidated long-term leverage target to approximately 4x and increased the dividend by 20% beginning in the third quarter of 2022, targeting a 10% annual dividend growth rate through the construction of Stage 3 into the mid-2020s. Our accelerated progress in terms of capital allocation, coupled with our revised plan demonstrates the power of the Cheniere platform through market cycles and solidifies our position as a leading global LNG operator and a preeminent North American infrastructure company. During the quarter, we repaid over $1.3 billion of consolidated long-term indebtedness, bringing our total debt pay down to over $4.4 billion through the third quarter since launching our capital allocation plan last year. And in the first 9 months of this year, we have repaid over $3.2 billion of debt. Just in the third quarter alone, we prepaid nearly $800 million of outstanding borrowings on the CCH term loan facility. And notably, we repurchased over $530 million in principal of senior notes at both CEI and CCH at price levels under par under an open market repurchase program that was initiated during the quarter. This past month, we have also redeemed $300 million of the 2023 senior secured notes at SBL, pursuant to an early redemption notice issued in September. We are clearly demonstrating our commitment to our balance sheet by utilizing multiple avenues to efficiently reach those target leverage metrics, and we will continue to be opportunistic as we optimize the debt across the Cheniere complex to achieve resilient and sustainable investment-grade credit metrics. Our accelerated deleveraging efforts towards an investment-grade consolidated balance sheet have been reflected in ratings upgrades by multiple agencies recently. In September, Moody's upgraded CEI two notches to Ba1 and CQP and SBL one notch to Ba1 and Baa2, bringing all S&P and Moody's ratings in sync across the Cheniere complex. Also in September, Fitch upgraded CQP to BBB- and SBL to BBB+. Fitch's upgrade of CQP to BBB- is significant as it marks the first-ever unsecured investment-grade rating at one of our corporate parent entities, and it's an important milestone in Cheniere's continued evolution. We will continue to execute on our 2020 Vision plan and expect further positive ratings momentum and migration to investment grade over time. In terms of shareholder returns, during the third quarter, we repurchased over 0.5 million shares for approximately $75 million, bringing our total shares repurchased to approximately 5 million shares for a little over $600 million. The share repurchase authorization we announced as part of our new capital allocation plan didn't commence until the fourth quarter. And I can tell you we are off and running under the new authorization, having already repurchased over 1 million shares just in October as we have now recalibrated our debt paydown to share repurchase ratio through 2026 on a long-term cumulative basis from 4:1 to 1:1 to further enhance shareholder returns while further solidifying our long-term investment-grade credit metrics. During the third quarter, we also declared and paid our fourth quarterly dividend of $0.33 per common share, bringing our total dividends paid to $1.32 per common share. Under our new capital allocation plan, we increased the dividend by 20% for the dividend related to the third quarter to $0.395 per common share and maintain our commitment to increasing the dividend by approximately 10% per year through Stage 3 construction, which will grow us into around a 20% payout ratio over time. Turn now to Slide 13, where I'll provide additional detail on our guidance and our open capacity for the remainder of 2022 as well as for 2023. We are reconfirming our full year 2022 guidance ranges of $11 billion to $11.5 billion in consolidated adjusted EBITDA and $8.1 billion to $8.6 billion in distributable cash flow. These ranges were each already increased by approximately $1.2 billion since our last earnings call in September, and we can now highlight that we are currently tracking into the upper half of both ranges as well as to the high end of our CQP distribution guidance of $4 to $4.25 per unit. Our guidance ranges illustrate what an incredible year 2022 has been for Cheniere. Since our initial guidance ranges for 2022 were provided 12 months ago, we have increased the midpoint of our EBITDA range by approximately 85%, DCF by approximately 150%, and CQP distribution by approximately one-third. With respect to the EBITDA sensitivity for the remainder of 2022, we are approaching the end of the year, and therefore, we have sold much of our total expected production for the remainder of the year and have approximately 20 TBtu unsold remaining. We currently forecast that a $1 change in market margin would impact EBITDA by approximately $20 million for the balance of 2022 as we have released the remaining volume that had been reserved for long-term origination back to C&I. Our results could also be impacted by those year-end cargoes we mentioned back on our call in September. With the volatility and evolving market dynamics, these cargoes could be drawn to Asia, which would push the timing of recognition of some of these cargoes into 2023. With that, being said, as we look to 2023 and our sensitivity to market margin, currently, we forecast approximately 150 TBtu of open volumes in 2023 and we expect a $1 change in market margin to impact 2023 EBITDA by approximately $130 million as a portion of our forecasted unsold volume for next year is being reserved for potential long-term origination negotiations. We do have some term contracts commencing over the course of the year. There is likely a slight weighting of that open volume to the first half of the year. In terms of major capital expenditures, I would mainly highlight we forecast spending approximately $1.5 billion in CapEx related to Corpus Christi Stage 3 in 2023, which is a similar amount to what we expect to have funded this year, including our LNTP payments since the start of 2022. As we mentioned in September, we will provide our full year EBITDA, DCF, and CQP distribution guidance ranges for 2023 on the fourth quarter call in February. Our unsold position in 2023 is expected to be lower than in 2022 as 2022 benefited from the early completion and ramp-up of Train 6 and the maintenance optimization we disclosed in May. Certain long-term contracts are scheduled to commence over the course of 2023, and we have planned maintenance scheduled for the next year at Sabine. Without a new train coming into service next year, we wouldn't expect a material change to the production forecast from here. The current state of global gas markets, which have featured elevated market margins for nearly a year now, underscore the global call for meaningful investment in natural gas infrastructure, which Cheniere is leading with our recent sanctioning of Corpus Christi Stage 3. During this prolonged period of heightened volatility, we've been deliberate and prudent stewards of capital, accelerating progress on our capital allocation objectives and positioning Cheniere for resilient success in the decades to come. And we expect to lead with a sustainable investment-grade balance sheet, accretive growth projects, and meaningful and growing shareholder returns. That concludes our prepared remarks. Thank you for your time and your interest in Cheniere. Operator, we are ready to open the line for questions.

We'll take our first question from Michael Lapides with Goldman Sachs.

Can you discuss the timeline for Stage 3 and how much progress you expect to make? Additionally, can you provide details on the maintenance schedule at Sabine Pass for 2023? I assume it will be during the shoulder months, but please correct me if I'm wrong. Is there a way to quantify the impact on volume?

Thank you, Michael. Regarding construction in Stage 3, I am very happy with the progress we have made so far. From my earlier comments, it's clear I expect my team and Bechtel to manage our commitments effectively. While it's still early for us to adjust our schedule, we should keep an eye on things if the favorable weather continues and we maintain our current execution pace. In terms of maintenance, you're correct that we aim to schedule it during the shoulder months when LNG prices tend to be lower. This year is unique for us because both trains will undergo maintenance at nearly the same time. For more details on the specifics of the maintenance quantities, I'll hand it over to Zach.

As we compare '22 to '23, we anticipate a slight increase in total production year-over-year, primarily due to Train 6. This year, we had around 11 months of production affecting our profit and loss, with some ramp-up in the first quarter. Next year, we will benefit from a full year of Train 6 production. However, this will be somewhat counterbalanced by significant maintenance scheduled for next year. Overall, we expect to produce approximately 44 million tons this year, and we project around 45 million tons next year as the remaining seven trains, which won’t be undergoing maintenance, will help compensate for the output.

We'll take our next question from Michael Blum with Wells Fargo.

So just wanted to go back, Zach, to your comments on CapEx in '23. So you flagged the Corpus Christi Stage 3 spending. So that's clear. Anything else you flagged major? I know you talked in the past about prep work on Midscale 8 and 9. So I just wanted to see if there are any other major items.

That's about it, Michael. I mean the $1.5 billion is the, let's say, all-in levered costs that we would deploy next year. And honestly, that's kind of what we expect this year. We've spent about $1 billion already pre-FID and post-FID and have another $400 million to $500 million to go this quarter as we're like 12% progressed at Stage 3. On other CapEx, we're going to be spending money, let's say, hundreds of millions of dollars across the board on things to continue to optimize, but also develop at Corpus and Sabine. And you're just not going to notice it as clearly; we'll have billing into DCF next year when we come out with it officially in February.

Okay. Got it. That makes sense. And then I just wanted to ask kind of between your debt and equity allocation decisions quarter-by-quarter. Third quarter buybacks are a little bit lower; debt purchase was higher. Clearly, buybacks are picked up in Q4. Just trying to see if there's any patterns we should be aware of or what's behind the decision process there?

Sure. In Q2, we repurchased over $500 million of stock during June when the stock faced some pressure, and we took advantage of that opportunity. Since Q3, the stock has increased by about $35, which means we've become less aggressive in our buying. However, when the stock price is stagnant or under pressure, we tend to buy more. Additionally, we needed to wait for the capital allocation announcement in mid-September due to the uncertainty surrounding it before officially establishing the 10b5-1 for Q4. That's why the new plan for allocation began in earnest in Q4, and we've already repurchased over a million shares just in October.

We'll take our next question from Jeremy Tonet with JPMorgan.

I just want to kind of reconcile against the last update that we heard from you guys. A bit over a month ago with the September update, you gave guidance. And since then, spreads came in and Europe faced logistical issues; you now point to the high end of the EBITDA guide. Just wondering what positives materialized, and will they carry into '23?

Jeremy, it's Zach. A few developments occurred for us. There was additional cargo at Corpus, and as I mentioned earlier, we saw an increase in subchartering revenue while positioning our portfolio for winter. Elevated shipping prices contributed positively as well. We took a proactive stance in selling into the market in September, prior to the decline, and now prices are just over $10 for the remainder of the year. However, this was slightly offset by some crossover cargoes we deferred into 2023, which are fluctuating based on whether they will be directed to Europe or Asia. This only accounted for a few hundred million. Additionally, we rolled over the final origination cargoes into 2023 to support our long-term planning. Overall, we feel confident we'll be in the upper half of the guidance range.

Got it. It makes sense. I suspect that some caution from Cheniere was included as well, which is good to see. Continuing with this, are these European logistics issues expected to carry over into 2023, and how might that impact your outlook? Also, considering the broader macro perspective, with Russia sending significantly less gas to Europe in 2023, how do you believe Europe will adapt next year?

Jeremy, it's Anatol. Thank you for your question. The positive development in Europe is that there is a strong effort to solve the infrastructure challenges. We discussed our excitement about inaugurating Eemshaven. That facility is set to double its capacity. We anticipate adding around 60 million tons of additional regas capacity throughout 2023, and we expect that figure to exceed 70 million tons in 2024. However, we share your concerns; Europe is still not in a stable position without the flow from pipelines. This year has been tricky, and we are particularly concerned about next winter. Fortunately, this winter benefitted from a significant amount of flow, even in the early part of the year before Nord Stream was completely shut down. It will be challenging, but we believe the infrastructure issues will be resolved in the next 6 to 12 months. We have already seen a notable reduction in floating storage in Europe, which we attribute partly to weather conditions, and we expect that the additional infrastructure solutions will come together swiftly. Nevertheless, securing gas for Europe will be quite difficult in the coming years.

Got it. So just to be clear on that last point, you're seeing the winter fill next year looks like it could be as tight as it was this year?

Weather-dependent, of course, as always, but entirely possible that it will be more difficult to reach these 80-plus percent full storage levels.

We'll take our next question from Marc Solecitto with Barclays.

In terms of the liquefaction fee environment and the marginal cost of new supply, it wasn't too long ago where it seemed like the industry might have been trending towards the lower half of that 2 to 2.50 CMI margin assumption range? So just wondering, with interest rates now at the highest they've been at in over 15 years and EPC costs trending higher, where do you see the marginal cost of new supply and liquefaction fees trending today?

Yes, thanks, Marc. We anticipate that trend to continue. However, I must say that, in practice, we haven't observed much of that yet. The competition among U.S. developers is still influencing expectations, particularly for buyers at the lower end of the range. I would note that there has been a slight improvement, but overall, with the competitively priced offtake agreements from some early-stage developers, as well as rising EPC costs and the current interest rate climate, it's a challenging situation to navigate. We believe this is partly why we haven't seen more projects advancing. Zach, would you like to share your thoughts on inflation?

Sure. So just to acknowledge the inflation out there that's clearly happening for everybody, and we think about our operating expenses or even our SG&A, our SPAs, which we have over 30 of with different counterparties all over the world, they all have a built-in annual escalator based on CPI for, let's say, approximately, give or take, 15%. And if you just bake that in and with how much we have in fixed fees, going into the new year, we're more than covering any inflation on O&M and SG&A for the company, which just highlights the stability of that run rate cash flow.

Got it. That's very helpful. And then as it relates to the 150 TBT open for next year, have you started to lock in some of your open exposure for 2023? And would that be included in that reference open capacity number?

Yes. So what we acknowledged in the prepared remarks and in the presentation is we actually have 150 TBtu truly open. And of that, we're reserving 20 TBtu for origination placeholders, so that $130 million, give or take, for a $1 move in margin, that's open today. However, I'd say we have probably sold onward and locked in fixed margins for around 20 TBtu for 2023 at this point. Clearly, the liquidity is pretty tough with how volatile it's been. But we're making a dent there and we'll give an even more robust update next year.

We'll take our next question from Jean Salisbury with Bernstein.

Anatol, I wanted to get your view on the medium-term LNG market. Obviously, some large moving pieces and whether more U.S. projects go forward and whether Russian gas keeps being curtailed; but seeing everything that you can see now, do you think it's more likely that LNG will be overbuilt or underbuilt in the back half of the decade?

I really don't see this overbuild dynamic even in that '26, '27, '28 timeframe. There's such an enormous amount of latent demand, if you will. We've been shying away from the term of demand destruction. We've termed it demand management. Even as prices pulled back in Europe modestly over the last 1 month, 1.5 months, you've seen a fairly dramatic resumption in industrial demand. So those numbers don't go away for a very long time. And yes, BASF and others may build facilities in the U.S. and in Qatar, but fundamentally, the demand picture in Europe just isn't going to change that much. And we still see a tremendous demand growth story out of Asia and emerging markets in general. So we, of course, as you know, fully believe that the Qatari mega trades will continue to come on, the four under construction now, plus two more, plus two more. There just aren't enough solutions, and now with this very robust contracting but relatively slow process to FID U.S. projects, that's just going to make the market that much tighter through the back half of this decade. So we see years and years of this dynamic before you can see a truly balanced market.

Jean, this is Jack. I always track how much capital is being invested in natural gas infrastructure around the world, and there's over $1 trillion right now of nat gas projects around the world with pipelines and power plants in regas facilities. So that, to me, is a signal that gas is here; it's here to stay for the long term, and that the LNG side of it will continue to grow.

Great. I appreciate all that. As a follow-up, I'm wondering what the waiting time is for a new LNG FERC filing these days. Earlier this year, you estimated it would take about 2 years, but mentioned that if the U.S. prioritized it, it could be done much faster. Is 2 years still a reasonable estimate, or could it be shorter or possibly longer?

Yes, over the past six years, we have doubled our business at Cheniere. Today, our permitting strategy is more crucial than ever, as the current regulatory environment makes it increasingly challenging to implement mid-course changes in design or construction. We have pre-filed for Midscale Trains 8 and 9, which were recently accepted. There is a six-month waiting period after the pre-filing, and we expect to file immediately after that, early next year for Trains 8 and 9. My goal is to make the commissioning of these trains consecutive, beginning with Train 8 right after Train 7 is commissioned. We are aiming to expedite this process. It is strategically important to ensure that all details are meticulously addressed in our applications now more than ever.

We'll take our next question from Brian Reynolds with UBS.

Maybe just a follow-up to Jean Ann's question on the FERC permitting process. Any insights on whether we could see further growth at Corpus or Sabine? Are there any signposts that we should be looking for in terms of preference? And when should we expect maybe a pre-FERC filing process to begin there?

No, look, you know from our talking points that and Anatol's talking point that we're looking at 30-plus MTPA of growth across the portfolio. I would expect Sabine to be first. I'd expect sometime next year that we do a pre-filing for additional growth there at Sabine. But again, like I said, we're making sure that we understand everything it is to know about that growth and that, that filing is complete, so it gets accepted and moved through the process appropriately. And then right after that, hopefully, Trains 8 and 9 will be done at Corpus, and we can focus on whatever additional expansion plans we have there.

We'll take our next question from Alex Kania with Wolfe Research.

Just can you talk a little bit more maybe just about the broader landscape of these partially contracted LNG projects? Do you think that, ultimately, a fair amount of those may not end up moving forward? And if so, do those kind of represent commercial opportunities for you to kind of discuss contracting with some of these parties that are already on board, some projects that may end up not moving forward?

Yes, Alex. This is Anatol. I'll respond to that first and see if anyone else wants to add to it. With the loss of Arctic Russia as a significant supply source for LNG demand, the U.S. became the next logical choice. There has been a rush to contract 40 million tons year-to-date, with 30 million of that still pending. The situation is complex, as the market has grown large and diverse, involving multiple participants. There are many load-serving entities among those 30 million tons that need LNG, as well as opportunistic buyers looking to capitalize on favorable economic conditions. We believe we are in an excellent position to continue growing our platform wisely and may benefit from buyers in need of supply in the coming years.

Great. Then maybe just a follow up on the rating agencies. I mean, I know they've had some time to digest the capital allocation plan that they've had; already some rating updates. Do you kind of have the sense though, broadly about how maybe that trend towards the investment-grade goal may look heading into next year or so? Just getting a sense of what else the rating agencies need to get you kind of uniformly into the BBB range?

Sure. This is Zach again. I want to express our strong confidence that our balance sheet strategy has recently been validated. We are seeing positive momentum with upgrades in our ratings coinciding with our debt reduction efforts, which have brought our credit metrics below 3x on a last twelve months basis. To put it simply, in the spirit of the Astros competing in the World Series and their recent success, we are in the final stages of achieving investment-grade ratings. Our plan involves a significant focus on further reducing debt and increasing EBITDA. The impact of our operational execution and construction projects, along with our agreements with more than 30 counterparties, with an average rating and a remaining contract life of 17 years for over 90% of our capacity, reinforces our confidence. We believe we will reach this goal by the first half of 2023, if not sooner. With several agencies already issuing upgrades this year, we feel we are just at the beginning of this positive trend.

We'll take our last question from Craig Shere with Tuohy Brothers.

Just kind of picking up a little on the last question about contracting. Note that long-term SPAs from perspective in actual U.S. projects kind of materially trailed off the last couple months. Given that brief hiatus, I wonder, Anatol, if you can opine on your confidence that the Europeans will step up to the table again into the first half of next year? And if you could give us a sense to the degree you think Cheniere is being shortlisted by the Europeans on prospective new long-term commitments due to a combination of your bridging cargoes, a desire to reward those who helped this year, and a desire to work with partners that can make clean energy investments in the medium and long term in CCUS and hydrogen a priority?

Thanks, Craig, for the leading question. If I ever gave you the impression that we feel confident that there will be an armada of European load-serving utilities as counterparties, I misspoke. I think that those will be few and far between. We, of course, have done transactions with Equinor and Engie this year, and we are optimistic that European-based buyers will be part of the portfolio and part of the solution going forward. But we do see the Asian market as the primary growth driver and the primary long-term contracting opportunity. Year-to-date, there have been few European buyers that have come to the table. You'll see them here and there. We're obviously in those discussions. As you said, we bring a lot to the table, but they are fewer and far between. And even though we have been a critical part of rebalancing Europe last year and this year and will continue to do our best to support its efforts to meet its energy demands, we don't expect a lot of load-serving European utilities to be in that 30-plus counterparty list going forward.

Thanks, everybody. Thanks for your support of Cheniere.

And ladies and gentlemen, this does conclude today's conference. We appreciate your participation. You may now disconnect.