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New words:
Basin, begun, behalf, bookrunner, bore, borrower, civil, combination, combined, Concrete, consecutive, coordinating, corroborated, deep, deposit, dollar, equivalent, fourth, free, FTA, Guaranty, independent, intensity, levee, LP, mandatory, margin, mixing, motion, move, MPLX, MUFG, Oral, pending, piling, pipe, program, renew, renewal, repaid, repayment, shale, smaller, soil, sought, Squared, standpoint, stay, steel, substantive, tank, underway, upholding, usage, Whistler, WhiteWater, withdrawal
Removed:
accounted, accrue, amendment, Army, ASU, back, beneficial, BND, Buyer, calculation, California, Cameron, close, combustion, commencing, compression, conditioned, contractual, conversion, County, daily, declared, departed, Depreciation, description, discretion, driver, eliminating, Elk, embedded, entity, expired, Fish, FOB, HGC, host, Hub, ii, indexed, indirect, INV, liability, maintaining, mitigation, modified, Navigation, Ninteenth, perform, permit, Permitting, post, preceding, produced, remaining, representing, retrospective, September, situated, source, Spectra, standard, stated, study, Subtopic, Transmission, treatment
Financial report summary
?Risks
- Restrictions in debt agreements may prevent certain beneficial transactions.
- Our projects are in the development and construction phases, and the success of such projects is unpredictable; as such, positive cash flows and even revenues will be several years away, if they occur at all.
- We will be required to seek additional debt and equity financing in the future to complete future phases of the Rio Grande LNG Facility and the development of CCS projects and may not be able to secure such financing on acceptable terms, or at all.
- There is substantial doubt about our ability to continue as a going concern.
- The Rio Grande LNG Facility’s operations will be substantially dependent on the development and operation of the Pipeline by Enbridge and its affiliates.
- We may be subject to risks related to doing business in, and having counterparties based in, foreign countries.
- Costs for the Rio Grande LNG Facility and CCS projects are subject to various factors.
- We will be dependent on third-party contractors for the successful completion of the Rio Grande LNG Facility and CCS projects, and these contractors may be unable to complete the Rio Grande LNG Facility or CCS projects or may build a non-conforming Rio Grande LNG Facility or CCS projects.
- Our ability to generate cash is substantially dependent upon us entering into satisfactory contracts with third parties and the performance of those third parties under those contracts.
- Our exposure to the performance and credit risks of counterparties may adversely affect our operating results, liquidity and access to financing.
- Our construction and operations activities will be subject to a number of development risks, operational hazards, regulatory approvals and other risks which may not be fully covered by insurance, and which could cause cost overruns and delays that could have a material adverse effect on our business, results of operations, financial condition, liquidity and prospects.
- We may experience increased labor costs, and the unavailability of skilled workers or our failure to attract and retain qualified personnel could adversely affect us. In addition, changes in our senior management or other key personnel could affect our business operations.
- Technological innovation, competition or other factors may negatively impact our anticipated competitive advantage or our processes.
- We depend on our intellectual property for our CCS projects, and our failure to protect that intellectual property could adversely affect the future growth and success of our CCS business.
- Failure of exported LNG to be a competitive source of energy for international markets could adversely affect our customers and could materially and adversely affect our business, contracts, financial condition, operating results, cash flow, liquidity and prospects.
- Decreases in the global demand for and price of natural gas (versus the price of imported LNG) could lead to reduced development of LNG projects worldwide.
- The reduction or elimination of government incentives could adversely affect our business, financial condition, future results and cash flows.
- Competition in the industries in which we operate is intense, and some of our competitors have greater financial, technological and other resources.
- There may be shortages of LNG vessels worldwide, which could have a material adverse effect on our business, results of operations, financial condition, liquidity and prospects.
- We will rely on third-party engineers to estimate the future capacity ratings and performance capabilities of the Rio Grande LNG Facility and CCS projects, and these estimates may prove to be inaccurate.
- Carbon credit markets may not develop as quickly or efficiently as we anticipate or at all.
- The operation of the Rio Grande LNG Facility and any CCS project may be subject to significant operating hazards and uninsured risks, one or more of which may create significant liabilities and losses that could have a material adverse effect on our business, results of operations, financial condition, liquidity and prospects.
- We are dependent on a limited number of customers for the purchase of LNG.
- Objections from local communities or environmental groups can delay the Rio Grande LNG Facility.
- The Rio Grande LNG Facility will be dependent on the availability of gas supply at the Agua Dulce supply area.
- Litigation could expose us to significant costs and adversely affect our business, financial condition, and results of operations.
- The construction and operation of the Rio Grande LNG Facility remains subject to further governmental approvals, and some approvals may be subject to further conditions, review and/or revocation and other legal and regulatory risks, which may result in delays, increased costs or decreased cash flows.
- The Rio Grande LNG Facility will be subject to a number of environmental laws and regulations that impose significant compliance costs, and existing and future environmental and similar laws and regulations could result in increased compliance costs, liabilities or additional operating restrictions.
- Unethical conduct and non-compliance with applicable laws could have a significant adverse effect on our business.
- We may not be able to utilize any future federal income tax credits.
- Our common stock could be delisted from Nasdaq.
- The market price of our common stock has fluctuated in the past and is likely to fluctuate in the future. Holders of our common stock could lose all or part of their investment.
- Raising additional capital may cause dilution to existing stockholders, restrict our operations or require us to relinquish rights. Additionally, sales of a substantial number of shares of our common stock or other securities in the public market could cause our stock price to fall.
- Our Second Amended and Restated Certificate of Incorporation grants our board of directors the power to designate and issue additional shares of common and/or preferred stock.
- The exercise of outstanding warrants may have a dilutive effect on our common stock.
- Provisions of our charter documents or Delaware law could discourage, delay or prevent us from being acquired even if being acquired would be beneficial to our stockholders and could make it more difficult to change management.
- Increasing attention to environmental, social and governance matters may impact our business, financial results or stock price and climate change concerns may pose challenges to our operating model.
- Cyberattacks targeting systems and infrastructure used in our business may adversely impact our operations.
- Terrorist attacks, including cyberterrorism, or military campaigns involving us or our projects could result in delays in, or cancellation of, construction or closure of the Rio Grande LNG Facility.
Management Discussion
- Net income attributable to common stockholders was $28.3 million, or $0.11 per common share (basic and diluted) for the three months ended March 31, 2024 compared to a net loss of $34.0 million, or $(0.23) per common share (basic and diluted), for the three months ended March 31, 2023. The $62.4 million decrease in net loss was primarily a result of derivative gain, partially offset by increases in general and administrative expense, net income attributable to non-controlling interest, loss on debt extinguishment and interest expense, net of capitalized interest.
- Derivative gain during the three months ended March 31, 2024 of $258.9 million is due to the reversal of derivative liabilities recognized at December 31, 2023 and an increase in forward SOFR rates from December 31, 2023 to March 31, 2024 relative to the fixed interest rates under Rio Grande's interest rate swap agreements.
- General and administrative expense during the three months ended March 31, 2024 increased approximately $6.2 million compared to the same period in 2023 primarily due to an increase in professional fees, employee costs and share-based compensation expense.