Sempra has permits in place to build a third LNG receiving station, in Texas.
That's because the collateral needs of the fast-growing trading business threaten to overwhelm Sempra's balance sheet.
Sempra chose the site farthest from the U.S. border (40 miles), for its minimal visual impact.
Baja Mexico was especially vulnerable to tightening gas supplies and ripe in opportunity for Sempra.
Sempra Energy (NYSE:SRE) is based in San Diego and is the San Diego public utility.
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The past three months have seen Wall Street analysts become less optimistic about Sempra Energy.
Sempra, an American company, has signed a contract to import gas from Indonesia instead of Bolivia.
Other competitors in the utilities sector include: Avista Corp (AVA), Sempra Energy (SRE), and SCANA (SCG).
For the other half, Sempra contracted to buy LNG for 20 years fromBP's Tangguh project in Indonesia.
For the other half, Sempra contracted to buy LNG for 20 years from BP's Tangguh project in Indonesia.
Sempra Energy is building new liquefied natural gas terminals in Louisiana and off the coast of Baja, Calif.
Sempra Commodities' Prince says 85% of his contracts are for less than two years and in very liquid markets.
"We said let's pretend we're building this on the California coast, " says Donald Felsinger, chief executive of Sempra Energy.
As with Baja LNG, Sempra will profit by leasing capacity and trading gas.
This was a big deal, because Sempra, the nation's largest gas utility, was building a fleet of gas-fired power plants.
The first piece was Sempra Commodities, a small energy trading operation launched at Drexel Burnham Lambert, then acquired by AIG.
One that I thought was very interesting is Sempra Energy ( SRE), which, of course, is in the utilities sector.
"It was kind of a David-and-Goliath situation, " recalls Mark Sweeney, a director at pipeline Sempra Energy, who negotiated with Aerie.
But even with customers ponying up the project financing, there's a limit to how many huge infrastructure deals Sempra can handle.
Sempra likes the safer technology so much it's employing it at its other LNG terminal being built in Cameron Parish, La.
Felsinger believes that as U.S. gas demand outstrips production, having a secure supply in Baja will become very valuable to Sempra.
Sempra likes the safer technology so much it's employing it at its other LNG terminal being built in Cameron Parish, Louisiana.
The BP deal guarantees Sempra gas at a discount to the price on the U.S.-Mexico border, locking in a nice spread.
Sempra today looks very different than it did in 1998, when it was created in the merger of two southern California utilities.
Sempra Energy shares are currently trading off about 0.7% on the day.
To win the terminal contract Sempra beat out five other energy companies.
The state will receive via Sempra's pipelines more than half the 1 billion cubic feet of gas delivered to Baja LNG each day.
Then there was its Sempra commodity traders, and assets from its airliner leasing business to more than 900 pubs, plus the Priory Clinic.
The report also cited the strong quarterly dividend history at Sempra Energy, and favorable long-term multi-year growth rates in key fundamental data points.
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Much of Sempra's trading consists in providing price hedges to industrial customers to smooth their costs of gas, electricity, steel, zinc or anything else.
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