Venture Global Inc. Third Quarter 2026 Earnings Conference Call - VENTURE GLOBAL INC

Explicit Guidance:

• 2026 Adjusted EBITDA: Raised to $10–11.3 billion (previously $8.7–9.1 billion) for the full year 2026.
• 2026 Cargo Volume: Low end of expected range increased by 9 cargoes; 99% of 2026 cargo portfolio is contracted.
• 2027 Cargo Volume: Maintained guidance of 575–625 total cargoes for 2027, including 10–20 cargoes from Calcasieu Pass 2 (CP2) in the second half of the year.
• 2026 Pricing Assumption: Contemplates liquefaction fees of $21–22 per MMBTU for remaining cargoes; sensitivity analysis indicates $20–30 million EBITDA adjustment per $1 MMBTU fee change.
• 2027 Guidance: EBITDA and pricing guidance to be provided on the Q4 2026 earnings call.

Business-Segment Outlook:

• LNG Production (Plaquemines & CP2): Plaquemines Phase 1 commercial operations commenced October 31, 2026 (53 months from FID). CP2 first LNG targeted for July 2027 (24 months from FID, beating previous 29-month record). Plaquemines produced 234 cargoes in its first year; CP2 expected to ramp production more quickly.
• CP2 Expansions: Financing expected in place soon for Phase 3 (10 MTPA expansion); Final Investment Decision (FID) targeted for early 2027.
• Plaquemines Expansions: Targeting FID for first expansion phase around mid-2027. New "Cloud Connector" pipeline from North Louisiana to be built to support gas supply for expansions and the adjacent AI utility site.
• Backlog/Pipeline: Contracted almost all 2026 cargoes (99%); robust demand for long-term contracts with a focus on Asian buyers. Expecting to add more 20-year SPAs before year-end 2026.
• AI Utility (Power & Compute):
  • Capacity Targets: Aiming for 5 gigawatts (GW) by end of 2031 and potential 10 GW by 2034 across Cameron and Blackman's Parishes.
  • Deployment Timeline: First 250 MW module targeting late 2028 to early 2029; incremental 250 MW builds to ramp through 2029–2030.
  • Infrastructure: Entered definitive agreements with GE Vernova, GE Grid Solutions, and Baker Hughes for up to 16 power islands (approx. 720 MW capacity per island). Planning to order one power plant by end of 2026 and a second in early 2027.

Market and Competitive Outlook:

• LNG Market Dynamics: Expect volatile to higher LNG prices during winter due to limited Middle East supply, slow European storage build, and increased European gas demand (nuclear output down 7% YoY). Markets described as increasingly inelastic with no observed demand destruction.
• Demand Trends: Strong demand for long-term contracts from Asia; expected shift to midterm deals (5–20 years) in 2027 to blend portfolio term lengths and capture higher spot prices.
• Competition/Supply: Over 30 incremental LNG projects announced since start of 2026. Venture Global positioned as a reliable stabilizer against supply disruptions (e.g., Blackstone production offsetting Middle East impacts).
• AI Market: High demand from hyperscalers and utilities for near-term power generation; scarcity of grid connectivity is a primary growth impeditant that Venture Global's island-mode solution addresses.

Macro / Industry Outlook:

• Economic/Supply Factors: Anticipates construction costs and replacement costs will continue to inflate over a multi-year period. Interest rates expected to remain stable or rise.
• Geopolitical/Regulatory: Sees Louisiana as having a "significant advantage" and "scarcity value" for data centers compared to other states awaiting regulatory clarity post-midterm elections.
• Energy Mix: European reliance on natural gas to balance wind volatility and nuclear constraints expected to persist through winter.

Strategic Initiatives:

• AI Utility Expansion: Developing a turnkey industrial AI utility solution using island mode power (non-grid reliant) to bypass public interconnectivity hurdles. No outside equity expected for current build plans.
• Capital Allocation: Financing for LNG bolt-ons (CP2 Phase 3, Plaquemines Phase 1) expected via project-level debt and retained earnings (no parent equity/debt raise). Power/Compute capital requirements pushed to 2029–2030 to align with LNG cash flow ramp-up.
• Financing: Secured a $3 billion revolving credit facility in September 2026; $1.8 billion of bridge debt repaid via distributions; expect to repay remaining $0.2 billion in Q4 2026.
• Execution: Leveraging existing 1,000-person in-house EPC team and ~4 GW of island mode power currently operating/in development.

Risks and Headwinds to Outlook:

• Execution/Timing: Production modestly impacted in Q3 2026 due to Plaquemines commissioning; CP2 ramp-up speed depends on execution efficiency. AI utility timing contingent on securing investment-grade customer contracts.
• Market Volatility: LNG prices could remain volatile if Middle East supply disruptions persist; coal price spikes could impact switching dynamics.
• Contracting: Final mix of contract terms (midterm vs. 20-year) depends on market pricing at the time of signing; inability to secure triple-net leases could impact power economics.
• Operational Costs: Potential costs associated with CP2 startup and AI utility development; gas basis impacts and ramp-up costs at Plaquemines may affect margins.

Management Tone on the Future:

• Confidence: Optimistic regarding 2027 and beyond; characterizes the contracting environment as "extremely attractive" and "stronger than ever."
• Strategic Fit: Views AI utility as a "natural extension" and "additive" to LNG business, not a distraction; emphasizes "low-risk, high-value" opportunity.
• Capital Discipline: Emphasizes disciplined approach to power deployment, matching incremental capacity with investment-grade commitments and risk-adjusted returns.
• Credit Profile: Expresses view that the strategy supports a path to investment grade via increased cash generation and contracted long-term sales.

Miscellaneous:

• Accounting: $1.4 billion non-cash gain recognized on interest rate swaps in Q3 2026; consolidated adjusted EBITDA margin held at 54% in Q3.
• Geographic Focus: All current AI utility site targets and LNG expansions are located in Cameron and Plaquemines Parishes, Louisiana.
• Liquidity: Ended Q3 2026 with $5.1 billion in cash and restricted cash.