The Aspiring $110 Billion Energy Company Banking on Trump’s Return
U.S. natural-gas exporter Venture Global plans to go public at an auspicious time for the LNG industry, cementing the firm’s meteoric rise
Gas exporter Venture Global is planning what would be the energy industry’s largest initial public offering in more than a decade on the heels of Donald Trump’s inauguration. The timing couldn’t be better.
The Arlington, Va.,-based firm, which chills natural gas into liquid to ship overseas, said in a regulatory filing last week that it hopes to raise up to $2.3 billion from an IPO. The issuance would peg the LNG company’s value at as much as $110 billion—more than the market capitalization of British oil giant BP.
The listing on the New York Stock Exchange could take place this week, said people familiar with the matter, and planning for it began before the election. It is sure to attract investors seeking to capitalize on Trump’s pro-oil-and-gas agenda.
After his swearing-in Monday, Trump plans to take a spate of executive actions to boost the fossil-fuel industry, including lifting a freeze on new LNG exports that President Biden imposed last year. Reversing the ban would free Venture Global’s hands to continue a building spree to produce more LNG in Louisiana, where it already runs two huge terminals.
“Brilliant timing on their end,” said Timm Schneider, a veteran energy analyst. “Everything’s kind of falling into place for them.”
Venture Global has also made inroads with the new administration. Chief Executive Michael Sabel attended an April meeting of oil and gas bosses at Mar-a-Lago, and the company employs former Trump officials. The company is a top donor to Trump’s presidential inauguration with a $1 million donation, according to people familiar with the matter.
The IPO is an eye-catching public entrance for Venture Global, a scrappy startup just a few years ago. After Russia’s invasion of Ukraine, the company sold dozens of LNG cargoes to gas-starved Europe, which allowed it to leapfrog rivals, pocket billions of dollars and invest in new terminals.
Venture Global’s meteoric rise has been clouded by controversy. BP, Shell and other early customers who contracted for Venture Global’s LNG have accused the company of enriching itself at their expense by withholding the fuel—and instead selling it on the spot market. The companies, which are in some cases both customers and competitors of Venture Global, are pursuing billions of dollars through arbitration.
Venture Global has said the accusations are meritless.
In a 2023 Wall Street Journal interview, Sabel said the company was a “historically significant disrupter,” which made it a target for rivals unable to keep up. “We are so busy executing, and winning, and being successful.”
Meteoric rise
Venture Global will become the second-biggest LNG exporter in the U.S. after Cheniere Energy once its second facility fully comes online. It plans three more terminals on the Gulf Coast, which, if built, would help its goal to supplant Qatar as the world’s top exporter of the fuel.
Venture Global potentially becoming a $110 billion public company is a surprise to many in the energy industry. Sabel, a former investment banker, and co-founder Robert Pender, an energy lawyer, roamed energy conferences for years promising to build facilities faster and cheaper than established rivals.
The two men founded the firm in 2013 with a different business model from the rest of the industry. Their idea was to combine midsize, prefabricated LNG units into a new export terminal. They promised it would be cheaper and faster than competitors, which typically built massive refrigeration units on-site.
The entrepreneurs dangled rock-bottom fees for LNG, landing mammoth clients such as Shell. Others followed, including BP, Spanish refiner Repsol, Portugal’s Galp and Polish state energy company PGNiG, and they signed long-term contracts that allowed Venture Global to get loans for the projects.
A turning point came after Russia invaded Ukraine in 2022, and gas prices soared as Europeans scrambled for alternatives to Russian energy. By then, Venture Global’s first plant was operating in a marshy swath of Louisiana, and the company sold cargoes to eager buyers. But it didn’t supply its early customers, saying it wasn’t bound to do so because the plant wasn’t fully operational.
While Shell, BP and others seethed, Venture Global raked in huge profits. The company said in IPO filings that it generated almost $7 billion in net income in 2022 and 2023 combined. Venture Global also said that it is in arbitration proceedings with seven early customers.
Venture Global has said customers knew from the beginning there would be an extended period to get the plant fully operational. Selling cargoes to others during that period before fulfilling long-term contracts was a part of its business plan, the company said.
Risks for investors
The controversy surrounding its handling of customers poses a challenge for Venture Global, which needs to attract new clients to build future projects, said Louis Lazzara, a senior research analyst at investment fund Energy Income Partners.
Another obstacle arose when Biden paused approvals on new LNG plants last year, stalling growth prospects and infuriating the industry. Trump’s fossil-fuel donors made it clear to him that a priority was lifting the pause and speeding up permitting for new export facilities. Trump is expected to deliver on that.
Reversing the moratorium will bolster the industry, but there are other risks for Venture Global. Investors may need to weigh a potential peace agreement between Russia and Ukraine, which could bring Russian gas flows back to Europe and dent demand for U.S. LNG. A potential rise in domestic natural-gas prices as electricity demand climbs—caused in part by the rise of artificial intelligence and data centers—could eat into Venture Global’s profits, Lazzara said.
And depending on the success of Venture Global’s listing, other privately held LNG companies could be inspired to follow the same path, said Mark Bononi, an analyst at Wood Mackenzie.
“Venture Global’s IPO reflects the natural progression and evolution of a rapidly growing and increasingly capital-hungry industry,” he said.