Sempra Posts 2Q Loss on Asset Sale Impairments

US utility and midstream company Sempra Energy said August 6 it posted a 2Q 2018 loss of US$561mn, compared to earnings of $259mn in the comparable period a year ago, and attributed the loss to impairments of $755mn and $145mn, respectively, on the planned sales of US midstream assets and wind energy investments.

On an adjusted basis which exclude the impairments, the company had second quarter earnings of $361mn, up from $276mn a year ago.

“In the second quarter, we achieved solid operating results and, with our recent successful equity offerings, we have strengthened our balance sheet,” Sempra Energy CEO Jeffrey Martin said. “We also have taken significant steps to begin optimizing our portfolio of assets and expand our liquefied natural gas (LNG) business. These initiatives are integral to our long-term strategic plan, which should deliver shareholder value through superior earnings and dividend growth.”

Sempra intends to sell several energy infrastructure assets, including its entire portfolio of US wind and solar assets and investments, as well as certain US midstream storage assets, including Gulf Coast gas storage facilities.

Late in the quarter, Sempra LNG & Midstream entered into a 20-year agreement for the sale of 2mn metric tons/year (mt/yr) of LNG to Poland’s national oil company from its Port Arthur LNG project, beginning in 2023, and selected Bechtel as its EPC contractor for the Port Arthur project.

Also late in the quarter, Sempra LNG & Midstream selected a partnership of TechnipFMC and Kiewit as its EPC contractor for the Energia Costa Azul liquefaction project under development in Mexico.