$VG Venture Global - Accumulation Breakout - Long Venture Global, Inc. Class ABATS:VGDillyDallyGallyVG Venture Global Established Breakout of an "Accumulation Rectangle." - Typical 4-6 year Digestion/Accumulation of Debt Sink in EV. - Ramp in EBITDA/Operation Capacity is a key driver. - Hang ups: Debt / Litigation. High Convexity: Operationally Convex (Capacity/Train additions) + TTF/JKM to HH Spread 1.Operational Convexity (Capacity/Train Additions) The classic infrastructure step-function. Each new liquefaction train that comes online (Plaquemines Phase 1 → Phase 2 → CP2) doesn't add value linearly. It adds value in discrete, non-linear jumps because: Fixed cost absorption: Each incremental train spreads the existing fixed cost base (G&A, pipeline infrastructure, site costs) across more volume. Marginal EBITDA per train increases with each addition. De-risking multiplier: Each successful train completion re-rates the multiple on all future trains by proving execution capability. The market assigns higher probability to CP2 once Plaquemines works. Reflexive financing loop: Successful trains generate cash flow → improve credit metrics → lower borrowing costs → make the next train cheaper to finance → higher NPV. 2.TTF/JKM-to-HH Spread (Geographic Arbitrage Convexity) Geographic Arbitrage Convexity (Crack Spread Analog) This is structurally identical to a refinery crack spread and carries the same type of convexity: processing margin convexity Parameters Entry zone: $13.00–15.00 (current price is within range) Initial position size: 2.0–2.5% of portfolio Scale-in trigger: Add 1.0–1.5% on pullback to $11–12 OR on Plaquemines positive milestone Max position: 5.0% of portfolio Time horizon: 12–18 months Stop-loss: Hard stop at $9.00 (~38% downside) — implies construction thesis is broken Trim-profit zone: Begin trimming at $20–22 (base case achieved) (*Not Financial Advise*) Holding Period: For those who believe in the secular spread trend of Low HH / High TTF . Venture Global is a "Hyper Scaler" of sorts. highly debt burdened but leveraged to a utility like / consistently profitable HH/TTF-JKM spread, buoyed by a early hybrid 60/40 Contract/Spot (likely to transition to a more contracted weighting as Debt burden subsides) | Function | Benchmark | Ticker | | **Buy gas** | Henry Hub | `NG` (NYMEX) | | **Sell LNG (spot)** | TTF / JKM | `TTF` (ICE) / `JKM` (Platts) | MetricHenry Hub (NG)TTFJKM 5Y Avg3.818.518.1 10Y Avg3.2910 Std Dev (10Y)1–1.58–126–10 Vol RegimeLowExtremeHigh Debt Sustainability Assessment MetricCurrent (FY2025)Pro Forma (FY2028E) Total Debt~$26B (excl. CP2 draw)~$35–40B (incl. CP2 fully drawn) EBITDA~$6.5B~$14–15B (base case) Net Debt / EBITDA~4.0x~2.0–2.5x Interest Coverage~2.5x~5.0x+ The leverage looks alarming in isolation, but in the context of project finance with 15–20 year contracted cash flows, 4.0x is manageable - and the trajectory is sharply deleveraging as facilities ramp & Current Spot HH / TTF / $JKM spreads *could* greatly reduce Debt rápidamente & buffer any litigation fallout (which could necessitate a carry forward in the DCF/ReRate given subsiding Debt/Litigation overhangs) >See Analog< LNG (Sep/2nd/2014 --> Apr/1st/2021) -Similar Ebitda Ramp -Same Accumulation Rectangle. -Same 50/200 SMA cross in upper half of Wyckoff Phase D