Sempra Sells $10B Infrastructure Stake, Greenlights Port Arthur LNG Phase 2

Sempra (NYSE: SRE) announced a $10 billion deal to sell a 45% stake in Sempra Infrastructure Partners to KKR and Canada Pension Plan Investments, while also approving the $14 billion Port Arthur LNG Phase 2 expansion.

The equity sale, expected to close in mid-2026, values Sempra Infrastructure Partners at $22.2 billion and will reduce Sempra’s exposure to non-utility assets while strengthening its balance sheet. Proceeds will be reinvested into regulated utilities in California and Texas, eliminating the need for equity issuances in its 2025–2029 capital plan. Following the transaction, a KKR-led group will hold 65% of the platform, Sempra will retain 25%, and Abu Dhabi Investment Authority will continue with 10%.

The move marks a sharp pivot toward a utility-centric strategy, with about 95% of earnings expected from regulated U.S. operations post-closing. Sempra estimates the transaction will add an average of $0.20 per share in annual earnings accretion starting in 2027, while improving credit metrics and cash flow stability.

Simultaneously, Sempra Infrastructure Partners has taken a final investment decision (FID) on Port Arthur LNG Phase 2 in Texas, a project adding two liquefaction trains with 13 Mtpa of capacity, plus a new storage tank. Estimated at $12 billion in direct capex plus $2 billion for shared infrastructure, the project is slated for commercial operations in 2030 and 2031.

Funding for Phase 2 comes from a $7 billion equity investment led by Blackstone Credit & Insurance, alongside KKR, Apollo, and Goldman Sachs Alternatives. Sempra Infrastructure Partners retains a 50.1% majority stake. Engineering and construction will again be led by Bechtel Energy, ensuring continuity from Phase 1 and cost efficiencies.

Long-term offtake agreements have already been secured with ConocoPhillips, EQT, JERA, and Sempra Infrastructure Partners itself, positioning the project to meet surging global LNG demand.

For 2025, Sempra narrowed its GAAP EPS guidance to $3.29–$3.69, while affirming adjusted EPS at $4.30–$4.70. The company also reaffirmed 2026 adjusted EPS guidance of $4.80–$5.30 and its long-term 7–9% compound annual growth rate through 2029.

The announcements highlight Sempra’s dual-track strategy: doubling down on regulated utility growth while keeping exposure to LNG exports through minority stakes and project-level investments. The deal deepens its partnership with KKR, already a major investor in U.S. energy infrastructure, and demonstrates sustained institutional appetite for LNG even as the sector faces energy transition pressures.