Natural Gas Exporter Venture Global Files for IPO

(Bloomberg) -- Venture Global Inc., one of the biggest suppliers of liquefied natural gas in the US, filed for what could be one of the largest initial public offerings of 2025.

The company won’t make public the proposed size and price for the share sale until a later filing. Bloomberg News reported in November that the company will seek to raise more than $3 billion in an IPO.

Venture Global will continue to be controlled by its founders, Mike Sabel and Bob Pender, after the IPO, according to Friday’s filing with the US Securities and Exchange Commission.

Venture Global is turning to Wall Street as demand around the world is surging for LNG, with many nations seeking a cleaner-burning alternative to oil and coal as they shift toward renewable energy. The US has emerged as the world’s largest exporter thanks to an abundant supply of gas and the development of huge terminals to liquefy and ship the fuel.

Sabel and Pender launched Venture Global in 2013. They were initially viewed as outsiders to the Houston energy industry and a longshot bet to the growing ranks of US LNG project developers.

Yet the pair managed to convince some of the world’s biggest energy companies including Shell Plc. and BP Plc. to sign long-term agreement to buy LNG from the terminal they planned to build. With those contracts in hand, Venture Global managed to raise $7.1 billion in financing to build its initial facility in southwestern Louisiana.

The export terminal, named Calcasieu Pass, began shipping fuel in 2022. But instead of supplying its long-term customers, Venture Global has sold all its cargoes since then into the spot market, where prices are significantly higher. The company has justified the move saying the plant remains in its “commissioning phase” as it works out kinks, which it contends absolves it from fulfilling contracts yet.   

That’s sparked opposition from Venture Global’s customers. Shell, BP, Repsol SA, Galp Energia SGPS SA, Orlen SA, China’s Sinopec and others have filed arbitration cases against the company, trying to force it to honor its contracts. 

In its filing on Friday, Venture Global said it plans to start fulfilling contracts for its Calcasieu Pass customers in March 2025.

Arlington, Virginia-based Venture Global is in the midst of starting up its second plant, Plaquemines LNG, just south of New Orleans. Two more projects, CP2 and Delta LNG, are also planned in Louisiana but remain in the permitting stage. It estimates the cost of Plaquemines LNG will be $22 billion to $23 billion, according to the filing.

The company is set to become the second-largest LNG producer in the US, behind Cheniere Energy Inc., once its second facility is fully online.

Venture Global had net income of $756 million in the nine months ended Sept. 30 on revenue of $3.4 billion, versus net income of $3.6 billion on revenue of $6.3 billion in the same period in 2023, according to the filing.

Sabel and Pender control about 84% of the Venture Global’s shares prior to the offering, the filing shows.

The offering is being led by Goldman Sachs Group Inc., JPMorgan Chase & Co. and Bank of America Corp. The company plans for its shares to trade on the New York Stock Exchange under the symbol VG.

Other details Venture Global disclosed for the first time in its filing Friday include: 

• The company estimates its CP2 project will cost between $27 billion and to $28 billion.
• Its CP3 project is expected to cost between $44 billion and $45 billion.
• Its Delta LNG project is expected to cost between $37 billion and $38 billion.
• Venture Global is working to sell additional LNG from its CP2 project to oil majors, utilities and trading houses.
• Two Venture Global customers for its CP2 project have not agreed to extend their contract deadlines, which could lead to them terminating the deals.
• Venture Global plans to construct pipelines to its CP2, CP3 and Delta projects to bring gas from the Permian, Haynesville, Eagle Ford other basins.

(Updates with more detail starting in the ninth paragraph.)

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