Call in the Green Natural Gas Bulls

The exporter
Another firm that benefits from strong natural gas drilling is the export company, Cheniere Energy, Inc. (NYSEAMEX:LNG). The firm is building facilities to take natural gas and cool it so that it can be transported overseas. Cheniere Sabine Pass trains one to four are already full subscribed. Train four is not expected to become operational until 2016 or 2017, but by then the company expects that $365 million in distributed cash will flow every year to Cheniere Energy Partners LP (NYSEMKT:CQP). Cheniere Energy, Inc. (NYSEAMEX:LNG) will see an immediate boost as it owns 55.9% of Cheniere Energy Partners LP (NYSEMKT:CQP).

Henry Hub Natural Gas Spot Price Chart

Henry Hub Natural Gas Spot Price data by YCharts

With low methane emissions from natural gas drilling, it will be easier for drillers to maintain a large supply of natural gas. Cheniere Energy, Inc. (NYSEAMEX:LNG) depends on the price differentials between the flooded North American market and more constricted Asian and European markets, making U.S. natural gas production a very important factor. Stronger U.S. demand will put upward pressure on natural gas prices, but it is very unlikely that they would rise to Japanese levels.

Drillers are constantly being accused of destroying the environment and creating a global environmental disaster. There is no way to completely remove their impacts on the environment, but the latest data shows that methane emissions are not as prevalent as they were once thought.

By improving equipment drillers like Chesapeake Energy Corporation (NYSE:CHK) and Exxon Mobil Corporation (NYSE:XOM) will be able to further reduce their emissions and boost demand for natural gas from environmentally conscious consumers. Low methane emissions and strong production levels will benefit U.S. LNG exporters like Cheniere Energy, Inc. (NYSEAMEX:LNG), as it increases the probability that U.S. drillers will keep prices low relative to international levels.

The article Call in the Green Natural Gas Bulls originally appeared on and is written by Joshua Bondy.

Joshua Bondy has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.