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Construction at Cheniere Energy Inc.'s LNG terminal in Sabine Pass, Louisiana, in December 2013.

Bloomberg

Cheniere Energy Inc. is scheduled to export the first cargo of liquefied natural gas from the lower 48 U.S. states in early 2016, a company executive said.

The company will begin producing LNG in January at the Sabine Pass terminal in Louisiana, with the inaugural cargo expected four to six weeks later, Tarek Souki, vice-president of finance for Houston-based Cheniere, said on Tuesday at the Natural Gas Roundtable luncheon in Washington.

Cargoes from Sabine Pass will compete with shipments from new Australian terminals as slower economic growth in Asia, cheap coal and the return of nuclear power in Japan limit global demand. U.S. gas prices have tumbled 24 per cent this year as a glut of supply from shale formations leaves stockpiles at a record.

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"We are producing our first drop of LNG next month," Mr. Souki said. "All of this is coming at a time when the global market is in a big state of change," Mr. Souki said.

Shipments from Sabine Pass will probably go to Lithuania and Western Europe eventually, he said. Litgas, part of Lithuania's state-controlled energy group, signed a trade agreement with Cheniere in March. Cheniere has also reached sale agreements with BG Group PLC, Gas Natural SDG SA, Korea Gas Corp. and GAIL India Ltd.

"We talk to the Lithuanians quite a bit," Mr. Souki said.

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