Venture Global sees shift coming in ratio of capex to cash flows
The leaders of Venture Global Inc., Arlington, Va., have nudged their 2026 capital spending guidance to the top of their previous range but on Aug. 11 told investors that future investments will shrink relative to the cash flows from the company’s LNG plants.
Chief executive officer Mike Sabel and his team also have lifted their forecast for Venture Global’s 2026 earnings before interest, taxes, depreciation and amortization by more than $500 million after a bumper second quarter and plan to sign more shorter-term contracts with customers eager to secure supply as the Iran war has dragged on.
Venture Global teams are working to expand the company’s Plaquemines and CP2 plants in Louisiana – a first phase at the former is on track for a commercial operation date late this year – with an eye to growing total capacity to 85 million tonnes/year (tpy) by end-2029. That process requires a lot of cash: Venture Global spent more than $27 billion on capital projects in 2024 and 2025 combined and Sabel and his lieutenants expect capex to be $13 billion this year. That forecast is a small increase from their previous guidance of $12 billion to $13 billion.
But, speaking on an Aug. 11 conference call discussing Venture Global’s second-quarter results, chief financial officer Jack Thayer said the spending pendulum should soon begin to swing away from massive projects. Bolt-on work at Plaquemines and CP2 remain attractive growth options, he added, but the company’s cash will have more options in the relatively near future.
“The relative scale of the incremental capital investment is expected to decline compared to our growing cash flows, creating more opportunities for other capital allocation priorities,” Thayer said, who also pointed to a more than doubling of Venture Global’s quarterly dividend. “Specifically, we plan to continue to retire and refinance higher-cost capital as bonds mature or are callable.”
Helping create options for Venture Global’s leaders are the growing inflows from operations. During the three months that ended June 30, the company sold more than 466 TBtu (up from 329 TBtu in the same period of last year), which generated adjusted EBITDA of nearly $2.5 billion, 79% more than in the 2025 quarter. That means executives now expect adjusted EBITDA for the year to be $8.7-9.1 billion, up from $8.2-8.5 billion 3 months ago.
The Middle East conflict has contributed to those earnings. The Venture Global team’s assumption for liquefaction fees in what remains of 2026 now range from $12.50/MMbtu to $13.50/MMbtu, up 30% from May. Sabel told analysts and investors that his team will look to capitalize on that pricing power to bring on more shorter-term contracts and improve the balance of its portfolio.
“You have seen us do several billion dollars of five-year deals. We […] expect to have multiple deals completed between now and the end of the year,” Sabel said when asked about how customer behavior has shifted as the Iran conflict has lasted longer than expected. “It is busier. I would say there has been an uptick in interest on the 5-year term and less in the last 90 days. As this conflict has become more difficult to predict, I think there has been a – I was going to say slight, but maybe a little more than slight uptick in shorter-term contracting interest.”
Shares of Venture Global (Ticker: VG) fell more than 6% to about $13.30 on the company’s earnings report and commentary, with several observers pointing to its higher costs. The stock is still up more than 30% over the past 6 months, however, and the company’s market capitalization is now more than $33 billion.
About the Author
Geert De Lombaerde
Senior Editor
A native of Belgium, Geert De Lombaerde has more than two decades of business journalism experience and writes about markets and economic trends for Endeavor Business Media publications Healthcare Innovation, IndustryWeek, FleetOwner, Oil & Gas Journal and T&D World. With a degree in journalism from the University of Missouri, he began his reporting career at the Business Courier in Cincinnati and later was managing editor and editor of the Nashville Business Journal. Most recently, he oversaw the online and print products of the Nashville Post and reported primarily on Middle Tennessee’s finance sector as well as many of its publicly traded companies.