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|
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|
|
|
T
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
£
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
|
|
|
|
Delaware
|
20-5913059
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(State or other jurisdiction of incorporation or organization)
|
(I.R.S. Employer Identification No.)
|
|
|
700 Milam Street, Suite 800
Houston, Texas
|
77002
|
(Address of principal executive offices)
|
(Zip Code)
|
|
|
|
|
|
Large accelerated filer
£
|
Accelerated filer
T
|
Non-accelerated filer
£
|
Smaller reporting company
£
|
(Do not check if a smaller reporting company)
|
|
|
|
|
|
|
|
|
|
|
|||
|
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|
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||
|
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||
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||
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|||
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|||
|
|
|
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|||
|
|
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|||
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|
|
|||
|
|
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|
|
June 30,
|
|
December 31,
|
|
||||
|
|
2013
|
|
2012
|
(1)
|
||||
ASSETS
|
|
(unaudited)
|
|
|
|
||||
Current assets
|
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
355,304
|
|
|
$
|
419,292
|
|
|
Restricted cash and cash equivalents
|
|
533,057
|
|
|
92,519
|
|
|
||
Accounts and interest receivable
|
|
23,923
|
|
|
44
|
|
|
||
Accounts receivable—affiliate
|
|
3,473
|
|
|
2,152
|
|
|
||
Advances to affiliate
|
|
8,483
|
|
|
4,987
|
|
|
||
LNG inventory
|
|
11,146
|
|
|
2,625
|
|
|
||
LNG inventory—affiliate
|
|
584
|
|
|
4,420
|
|
|
||
Prepaid expenses and other
|
|
9,730
|
|
|
7,084
|
|
|
||
Total current assets
|
|
945,700
|
|
|
533,123
|
|
|
||
Non-current restricted cash and cash equivalents
|
|
1,777,749
|
|
|
272,425
|
|
|
||
Property, plant and equipment, net
|
|
4,831,351
|
|
|
3,219,592
|
|
|
||
Debt issuance costs, net
|
|
351,830
|
|
|
220,949
|
|
|
||
Non-current derivative assets
|
|
81,762
|
|
|
—
|
|
|
||
Other
|
|
23,206
|
|
|
19,698
|
|
|
||
Total assets
|
|
$
|
8,011,598
|
|
|
$
|
4,265,787
|
|
|
LIABILITIES AND PARTNERS’ EQUITY
|
|
|
|
|
|
||||
Current liabilities
|
|
|
|
|
|
||||
Accounts payable
|
|
$
|
19,882
|
|
|
$
|
73,760
|
|
|
Accounts payable—affiliate
|
|
—
|
|
|
1,122
|
|
|
||
Accrued liabilities
|
|
457,691
|
|
|
47,848
|
|
|
||
Accrued liabilities—affiliate
|
|
44,744
|
|
|
5,744
|
|
|
||
Deferred revenue
|
|
26,585
|
|
|
26,540
|
|
|
||
Deferred revenue—affiliate
|
|
696
|
|
|
696
|
|
|
||
Other
|
|
3,653
|
|
|
126
|
|
|
||
Total current liabilities
|
|
553,251
|
|
|
155,836
|
|
|
||
Long-term debt, net of discount
|
|
5,572,008
|
|
|
2,167,113
|
|
|
||
Deferred revenue
|
|
19,500
|
|
|
21,500
|
|
|
||
Deferred revenue—affiliate
|
|
17,173
|
|
|
14,720
|
|
|
||
Long-term derivative liability
|
|
—
|
|
|
26,424
|
|
|
||
Other non-current liabilities
|
|
1,212
|
|
|
216
|
|
|
||
Commitments and contingencies
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
||||
Partners' equity
|
|
|
|
|
|
||||
Creole Trail Pipeline Business equity
|
|
—
|
|
|
517,170
|
|
|
||
Common unitholders' interest (57.1 million units and 39.5 million units issued and outstanding at June 30, 2013 and December 31, 2012, respectively)
|
|
806,193
|
|
|
448,412
|
|
|
||
Class B unitholders' interest (145.3 million units and 133.3 million units issued and outstanding at June 30, 2013 and December 31, 2012, respectively)
|
|
(38,216
|
)
|
|
(37,342
|
)
|
|
||
Subordinated unitholder's interest (135.4 million units issued and outstanding at June 30, 2013 and December 31, 2012)
|
|
1,042,320
|
|
|
949,482
|
|
|
||
General partner's interest (2% interest with 6.9 million units and 6.3 million units issued and outstanding at June 30, 2013 and December 31, 2012, respectively)
|
|
38,157
|
|
|
29,496
|
|
|
||
Accumulated other comprehensive loss
|
|
—
|
|
|
(27,240
|
)
|
|
||
Total partners’ equity
|
|
1,848,454
|
|
|
1,879,978
|
|
|
||
Total liabilities and partners’ equity
|
|
$
|
8,011,598
|
|
|
$
|
4,265,787
|
|
|
_________________
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
||||||||||||
|
|
June 30,
|
|
June 30,
|
|
||||||||||||
|
|
2013
|
|
2012
|
(1)
|
2013
|
|
2012
|
(1)
|
||||||||
Revenues
|
|
|
|
|
|
|
|
|
|
||||||||
Revenues
|
|
$
|
66,842
|
|
|
$
|
60,767
|
|
|
$
|
132,406
|
|
|
$
|
127,731
|
|
|
Revenues—affiliate
|
|
795
|
|
|
656
|
|
|
1,341
|
|
|
3,044
|
|
|
||||
Total revenues
|
|
67,637
|
|
|
61,423
|
|
|
133,747
|
|
|
130,775
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
||||||||
Expenses
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Operating and maintenance expense
|
|
20,902
|
|
|
7,466
|
|
|
29,198
|
|
|
13,668
|
|
|
||||
Operating and maintenance expense—affiliate
|
|
10,307
|
|
|
3,247
|
|
|
17,220
|
|
|
6,776
|
|
|
||||
Depreciation expense
|
|
14,355
|
|
|
14,336
|
|
|
28,658
|
|
|
28,645
|
|
|
||||
Development expense
|
|
3,318
|
|
|
14,472
|
|
|
6,803
|
|
|
31,141
|
|
|
||||
Development expense—affiliate
|
|
611
|
|
|
1,031
|
|
|
1,062
|
|
|
2,262
|
|
|
||||
General and administrative expense
|
|
2,028
|
|
|
2,193
|
|
|
5,803
|
|
|
4,497
|
|
|
||||
General and administrative expense—affiliate
|
|
36,543
|
|
|
5,928
|
|
|
59,759
|
|
|
11,875
|
|
|
||||
Total expenses
|
|
88,064
|
|
|
48,673
|
|
|
148,503
|
|
|
98,864
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
||||||||
Income (loss) from operations
|
|
(20,427
|
)
|
|
12,750
|
|
|
(14,756
|
)
|
|
31,911
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
||||||||
Other income (expense)
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Interest expense, net
|
|
(42,016
|
)
|
|
(43,458
|
)
|
|
(82,278
|
)
|
|
(86,916
|
)
|
|
||||
Loss on early extinguishment of debt
|
|
(80,510
|
)
|
|
—
|
|
|
(80,510
|
)
|
|
—
|
|
|
||||
Derivative gain (loss), net
|
|
95,509
|
|
|
261
|
|
|
78,041
|
|
|
(575
|
)
|
|
||||
Other
|
|
434
|
|
|
61
|
|
|
760
|
|
|
132
|
|
|
||||
Total other expense
|
|
(26,583
|
)
|
|
(43,136
|
)
|
|
(83,987
|
)
|
|
(87,359
|
)
|
|
||||
|
|
|
|
|
|
|
|
|
|
||||||||
Net loss
|
|
$
|
(47,010
|
)
|
|
$
|
(30,386
|
)
|
|
$
|
(98,743
|
)
|
|
$
|
(55,448
|
)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Net loss attributable to the Creole Trail Pipeline Business
|
|
$
|
(9,148
|
)
|
|
$
|
(5,525
|
)
|
|
$
|
(18,394
|
)
|
|
$
|
(11,255
|
)
|
|
Net loss attributable to partners
|
|
(37,862
|
)
|
|
(24,861
|
)
|
|
(80,349
|
)
|
|
(44,193
|
)
|
|
||||
Net loss
|
|
$
|
(47,010
|
)
|
|
$
|
(30,386
|
)
|
|
$
|
(98,743
|
)
|
|
$
|
(55,448
|
)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Basic and diluted net income per common unit
|
|
$
|
0.11
|
|
|
$
|
0.17
|
|
|
$
|
0.21
|
|
|
$
|
0.40
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted average number of common units outstanding used for basic and diluted net income per common unit calculation
|
|
57,079
|
|
|
31,328
|
|
|
51,345
|
|
|
31,173
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
||||||||||||
|
June 30,
|
|
June 30,
|
|
||||||||||||
|
2013
|
|
2012
|
(1)
|
2013
|
|
2012
|
(1)
|
||||||||
Net loss
|
$
|
(47,010
|
)
|
|
$
|
(30,386
|
)
|
|
$
|
(98,743
|
)
|
|
$
|
(55,448
|
)
|
|
Other comprehensive income
|
|
|
|
|
|
|
|
|
||||||||
Interest rate cash flow hedges
|
|
|
|
|
|
|
|
|
||||||||
Loss on settlements retained in other comprehensive income
|
—
|
|
|
—
|
|
|
(30
|
)
|
|
—
|
|
|
||||
Change in fair value of interest rate cash flow hedges
|
—
|
|
|
—
|
|
|
21,297
|
|
|
—
|
|
|
||||
Losses reclassified into earnings as a result of discontinuance of cash flow hedge accounting
|
5,973
|
|
|
—
|
|
|
5,973
|
|
|
—
|
|
|
||||
Total other comprehensive income
|
5,973
|
|
|
—
|
|
|
27,240
|
|
|
—
|
|
|
||||
Comprehensive loss
|
$
|
(41,037
|
)
|
|
$
|
(30,386
|
)
|
|
$
|
(71,503
|
)
|
|
$
|
(55,448
|
)
|
|
|
|
|
|
|
|
Common Unitholders' Interest
|
|
Class B Unitholders' Interest
|
|
Subordinated Unitholder's Interest
|
|
General Partner's Interest
|
|
Accumulated Other Comprehensive Loss
|
|
Creole Trail Pipeline Business Equity
|
|
Total Partners' Equity
|
||||||||||||||||||||||||||
|
Units
|
|
Amount
|
|
Units
|
|
Amount
|
|
Units
|
|
Amount
|
|
Units
|
|
Amount
|
|
|
|
|||||||||||||||||||||
Balance at December 31, 2012
(1)
|
39,488
|
|
|
$
|
448,412
|
|
|
133,333
|
|
|
$
|
(37,342
|
)
|
|
135,384
|
|
|
$
|
949,482
|
|
|
6,290
|
|
|
$
|
29,496
|
|
|
$
|
(27,240
|
)
|
|
$
|
517,170
|
|
|
$
|
1,879,978
|
|
Net loss
|
—
|
|
|
(21,344
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(56,277
|
)
|
|
—
|
|
|
(2,728
|
)
|
|
—
|
|
|
(18,394
|
)
|
|
(98,743
|
)
|
|||||||
Contributions to Creole Trail Pipeline Business from Cheniere, net
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
20,705
|
|
|
20,705
|
|
|||||||
Acquisition of Creole Trail Pipeline Business
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(519,481
|
)
|
|
(519,481
|
)
|
|||||||
Excess of acquired assets over the purchase price
|
|
|
1,988
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
22,498
|
|
|
—
|
|
|
1,105
|
|
|
—
|
|
|
—
|
|
|
25,591
|
|
||||||||
Issuance of Class B units associated with acquisition of Creole Trail Pipeline Business
|
—
|
|
|
—
|
|
|
12,000
|
|
|
179,126
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
179,126
|
|
|||||||
Sale of common and general partner units
|
17,590
|
|
|
364,795
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
604
|
|
|
11,122
|
|
|
—
|
|
|
—
|
|
|
375,917
|
|
|||||||
Distributions
|
—
|
|
|
(41,041
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(838
|
)
|
|
—
|
|
|
—
|
|
|
(41,879
|
)
|
|||||||
Interest rate cash flow hedges
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
27,240
|
|
|
—
|
|
|
27,240
|
|
|||||||
Beneficial conversion feature of Class B units
|
—
|
|
|
53,383
|
|
|
—
|
|
|
(180,000
|
)
|
|
—
|
|
|
126,617
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Balance at June 30, 2013
|
57,078
|
|
|
$
|
806,193
|
|
|
145,333
|
|
|
$
|
(38,216
|
)
|
|
135,384
|
|
|
$
|
1,042,320
|
|
|
6,894
|
|
|
$
|
38,157
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,848,454
|
|
|
|
|
|
|
|
|
Six Months Ended
|
|
||||||
|
|
June 30,
|
|
||||||
|
|
2013
|
|
2012
|
(1)
|
||||
Cash flows from operating activities
|
|
|
|
|
|
||||
Net loss
|
|
$
|
(98,743
|
)
|
|
$
|
(55,448
|
)
|
|
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
|
|
|
|
|
|
||||
Depreciation
|
|
28,658
|
|
|
28,645
|
|
|
||
Use of restricted cash and cash equivalents
|
|
35,070
|
|
|
—
|
|
|
||
Amortization of debt discount
|
|
2,799
|
|
|
2,347
|
|
|
||
Amortization of debt issuance costs
|
|
2,120
|
|
|
2,185
|
|
|
||
Non-cash derivative (gain) loss, net
|
|
(77,989
|
)
|
|
821
|
|
|
||
Loss on early extinguishment of debt
|
|
80,510
|
|
|
—
|
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
|
|
||||
Accounts and interest receivable
|
|
(23,879
|
)
|
|
499
|
|
|
||
Accounts receivable—affiliate
|
|
(1,409
|
)
|
|
(629
|
)
|
|
||
Accounts payable and accrued liabilities
|
|
2,523
|
|
|
7,679
|
|
|
||
Accounts payable and accrued liabilities—affiliate
|
|
31,197
|
|
|
3,668
|
|
|
||
Deferred revenue
|
|
(1,955
|
)
|
|
(3,481
|
)
|
|
||
Advances to affiliate
|
|
(3,027
|
)
|
|
(1,508
|
)
|
|
||
LNG inventory—affiliate
|
|
3,837
|
|
|
3,399
|
|
|
||
Other
|
|
(4,397
|
)
|
|
(5,691
|
)
|
|
||
Net cash used in operating activities
|
|
(24,685
|
)
|
|
(17,514
|
)
|
|
||
|
|
|
|
|
|
||||
Cash flows from investing activities
|
|
|
|
|
|
|
|
||
Use of restricted cash and cash equivalents
|
|
1,266,347
|
|
|
—
|
|
|
||
LNG terminal costs, net
|
|
(1,271,830
|
)
|
|
(39,161
|
)
|
|
||
Purchase of Creole Trail Pipeline Business, net
|
|
(313,892
|
)
|
|
—
|
|
|
||
Other
|
|
(2,990
|
)
|
|
(4,714
|
)
|
|
||
Net cash used in investing activities
|
|
(322,365
|
)
|
|
(43,875
|
)
|
|
||
|
|
|
|
|
|
||||
Cash flows from financing activities
|
|
|
|
|
|
|
|
||
Proceeds from Sabine Pass Liquefaction Senior Notes, net
|
|
3,012,500
|
|
|
—
|
|
|
||
Proceeds from CTPL Credit Facility, net
|
|
391,978
|
|
|
—
|
|
|
||
Proceeds from 2013 Liquefaction Credit Facilities
|
|
100,000
|
|
|
—
|
|
|
||
Proceeds from sale of partnership common and general partner units, net
|
|
375,917
|
|
|
12,379
|
|
|
||
Proceeds from sale of Class B units
|
|
—
|
|
|
166,667
|
|
|
||
Contributions to Creole Trail Pipeline Business from Cheniere, net
|
|
20,705
|
|
|
4,449
|
|
|
||
Investment in restricted cash and cash equivalents
|
|
(3,247,277
|
)
|
|
—
|
|
|
||
Debt issuance and deferred financing costs
|
|
(228,882
|
)
|
|
(5,530
|
)
|
|
||
Repayment of 2012 Liquefaction Credit Facility
|
|
(100,000
|
)
|
|
—
|
|
|
||
Distributions to owners
|
|
(41,879
|
)
|
|
(27,040
|
)
|
|
||
Net cash provided by financing activities
|
|
283,062
|
|
|
150,925
|
|
|
||
|
|
|
|
|
|
||||
Net increase (decrease) in cash and cash equivalents
|
|
(63,988
|
)
|
|
89,536
|
|
|
||
Cash and cash equivalents—beginning of period
|
|
419,292
|
|
|
81,415
|
|
|
||
Cash and cash equivalents—end of period
|
|
$
|
355,304
|
|
|
$
|
170,951
|
|
|
|
|
|
|
|
|
|
June 30,
|
|
December 31,
|
||||
|
|
2013
|
|
2012
|
||||
LNG terminal costs
|
|
|
|
|
||||
LNG terminal
|
|
$
|
2,224,392
|
|
|
$
|
2,224,230
|
|
LNG terminal construction-in-process
|
|
2,868,812
|
|
|
1,228,647
|
|
||
LNG site and related costs, net
|
|
152
|
|
|
156
|
|
||
Accumulated depreciation
|
|
(262,925
|
)
|
|
(234,349
|
)
|
||
Total LNG terminal costs, net
|
|
4,830,431
|
|
|
3,218,684
|
|
||
|
|
|
|
|
||||
Fixed assets
|
|
|
|
|
|
|
||
Computer and office equipment
|
|
424
|
|
|
368
|
|
||
Vehicles
|
|
884
|
|
|
704
|
|
||
Machinery and equipment
|
|
1,471
|
|
|
1,473
|
|
||
Other
|
|
750
|
|
|
760
|
|
||
Accumulated depreciation
|
|
(2,609
|
)
|
|
(2,397
|
)
|
||
Total fixed assets, net
|
|
920
|
|
|
908
|
|
||
|
|
|
|
|
||||
Property, plant and equipment, net
|
|
$
|
4,831,351
|
|
|
$
|
3,219,592
|
|
|
Fair Value Measurements as of
|
||||||||||||||||||||||||||||||
|
June 30, 2013
|
|
December 31, 2012
|
||||||||||||||||||||||||||||
|
Quoted Prices in Active Markets
(Level 1)
|
|
Significant Other Observable Inputs (Level 2)
|
|
Significant Unobservable Inputs (Level 3)
|
|
Total
|
|
Quoted Prices in Active Markets
(Level 1)
|
|
Significant Other Observable Inputs (Level 2)
|
|
Significant Unobservable Inputs (Level 3)
|
|
Total
|
||||||||||||||||
LNG Inventory Derivatives asset
|
$
|
—
|
|
|
$
|
764
|
|
|
$
|
—
|
|
|
$
|
764
|
|
|
$
|
—
|
|
|
$
|
232
|
|
|
$
|
—
|
|
|
$
|
232
|
|
Fuel Derivatives (liability)
|
—
|
|
|
(200
|
)
|
|
—
|
|
|
(200
|
)
|
|
—
|
|
|
(98
|
)
|
|
—
|
|
|
(98
|
)
|
||||||||
Interest Rate Derivatives asset (liability)
|
—
|
|
|
78,207
|
|
|
—
|
|
|
78,207
|
|
|
—
|
|
|
(26,424
|
)
|
|
—
|
|
|
(26,424
|
)
|
|
|
|
|
Fair Value Measurements as of
|
||||||
|
Balance Sheet Location
|
|
June 30, 2013
|
|
December 31, 2012
|
|||||
LNG Inventory Derivatives asset
|
Prepaid expenses and other
|
|
$
|
764
|
|
|
$
|
232
|
|
|
Fuel Derivatives (liability)
|
Other current liabilities
|
|
(200
|
)
|
|
(98
|
)
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
|||||||||||
|
2013
|
|
2012
|
|
2013
|
|
2012
|
|||||||
LNG Inventory Derivatives gain (loss)
|
$
|
884
|
|
|
$
|
(246
|
)
|
|
334
|
|
|
$
|
925
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2013
|
|
2012
|
|
2013
|
|
2012
|
||||||||
Fuel Derivatives gain (loss) (1)
|
$
|
(464
|
)
|
|
$
|
261
|
|
|
$
|
52
|
|
|
$
|
(575
|
)
|
|
|
|
|
|
|
|
Initial Notional Amount
|
|
Maximum Notional Amount
|
|
Effective Date
|
|
Maturity Date
|
|
Weighted Average Fixed Interest Rate Paid
|
|
Variable Interest Rate Received
|
|||
Interest Rate Derivatives - Not Designated
|
|
$20.0 million
|
|
$
|
2.9
|
billion
|
|
August 14, 2012
|
|
July 31, 2019
|
|
1.98%
|
|
One-month LIBOR
|
|
Interest Rate Derivatives - Not Designated
|
|
—
|
|
|
$
|
671.0
|
million
|
|
June 5, 2013
|
|
May 31, 2020
|
|
2.05%
|
|
One-month LIBOR
|
|
|
|
|
Fair Value Measurements as of
|
||||||
|
|
Balance Sheet Location
|
|
June 30, 2013
|
|
December 31, 2012
|
||||
Interest Rate Derivatives - Not Designated
|
|
Non-current derivative assets
|
|
$
|
81,762
|
|
|
$
|
—
|
|
Interest Rate Derivatives - Designated
|
|
Non-current derivative liabilities
|
|
—
|
|
|
21,290
|
|
||
Interest Rate Derivatives - Not Designated
|
|
Other current liabilities
|
|
3,555
|
|
|
—
|
|
||
Interest Rate Derivatives - Not Designated
|
|
Non-current derivative liabilities
|
|
—
|
|
|
5,134
|
|
|
Gain (Loss) in Other Comprehensive Income
|
|
Gain (Loss) Reclassified from AOCI into Interest Expense (Effective Portion)
|
|
Losses Reclassified into Earnings as a Result of Discontinuance of Cash Flow Hedge Accounting
|
||||||||||||||||||
|
2013
|
|
2012
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
||||||||||||
Interest Rate Derivatives - Designated
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(5,806
|
)
|
|
$
|
—
|
|
Interest Rate Derivatives - Settlements
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(167
|
)
|
|
—
|
|
|
Gain (Loss) in Other Comprehensive Income
|
|
Gain (Loss) Reclassified from AOCI into Interest Expense (Effective Portion)
|
|
Losses Reclassified into Earnings as a Result of Discontinuance of Cash Flow Hedge Accounting
|
||||||||||||||||||
|
2013
|
|
2012
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
||||||||||||
Interest Rate Derivatives - Designated
|
$
|
21,297
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(5,806
|
)
|
|
$
|
—
|
|
Interest Rate Derivatives - Settlements
|
(30
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(167
|
)
|
|
—
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2013
|
|
2012
|
|
2013
|
|
2012
|
||||||||
Interest Rate Derivatives - Not Designated gain
|
$
|
101,263
|
|
|
$
|
—
|
|
|
$
|
83,279
|
|
|
$
|
—
|
|
|
|
Gross Amounts Recognized
|
|
Gross Amounts Offset in the Consolidated Balance Sheet
|
|
Net Amounts Presented in the Consolidated Balance Sheet
|
|
Gross Amounts Not Offset in the Consolidated Balance Sheet
|
|
|
|||||||||||||||
Offsetting Derivative Assets (Liabilities)
|
|
|
|
|
Derivative Instrument
|
|
Cash Collateral Received (Paid)
|
|
Net Amount
|
||||||||||||||||
As of June 30, 2013:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Fuel Derivatives
|
|
$
|
(200
|
)
|
|
$
|
(200
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
LNG Inventory Derivatives
|
|
764
|
|
|
556
|
|
|
208
|
|
|
—
|
|
|
—
|
|
|
208
|
|
|||||||
Interest Rate Derivatives - Not Designated
|
|
81,762
|
|
|
—
|
|
|
81,762
|
|
|
—
|
|
|
—
|
|
|
81,762
|
|
|||||||
Interest Rate Derivatives - Not Designated
|
|
(3,555
|
)
|
|
—
|
|
|
(3,555
|
)
|
|
—
|
|
|
—
|
|
|
(3,555
|
)
|
|||||||
As of December 31, 2012:
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Fuel Derivatives
|
|
(98
|
)
|
|
(98
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
LNG Inventory Derivatives
|
|
232
|
|
|
—
|
|
|
232
|
|
|
—
|
|
|
—
|
|
|
232
|
|
|||||||
Interest Rate Derivatives - Designated
|
|
(21,290
|
)
|
|
—
|
|
|
(21,290
|
)
|
|
—
|
|
|
—
|
|
|
(21,290
|
)
|
|||||||
Interest Rate Derivatives - Not Designated
|
|
(5,134
|
)
|
|
—
|
|
|
(5,134
|
)
|
|
—
|
|
|
—
|
|
|
(5,134
|
)
|
|
|
June 30, 2013
|
|
December 31, 2012
|
|||||||||||
|
|
Carrying
Amount
|
|
Estimated
Fair Value
|
|
Carrying
Amount
|
|
Estimated
Fair Value
|
|||||||
2016 Notes, net of discount (1)
|
|
$
|
1,649,460
|
|
|
1,781,417
|
|
|
$
|
1,647,113
|
|
|
$
|
1,824,177
|
|
2020 Notes (1)
|
|
420,000
|
|
|
427,350
|
|
|
420,000
|
|
|
437,850
|
|
|||
2021 Sabine Pass Liquefaction Senior Notes (1)
|
|
2,012,118
|
|
|
1,951,755
|
|
|
—
|
|
|
—
|
|
|||
2023 Sabine Pass Liquefaction Senior Notes (1)
|
|
1,000,000
|
|
|
957,500
|
|
|
—
|
|
|
—
|
|
|||
2012 Liquefaction Credit Facility (2)
|
|
—
|
|
|
—
|
|
|
100,000
|
|
|
100,000
|
|
|||
2013 Liquefaction Credit Facilities (2)
|
|
100,000
|
|
|
100,000
|
|
|
—
|
|
|
—
|
|
|||
CTPL Credit Facility (3)
|
|
390,429
|
|
|
400,000
|
|
|
—
|
|
|
—
|
|
|
(1)
|
The Level 2 estimated fair value was based on quotations obtained from broker-dealers who make markets in these and similar instruments based on the closing trading prices on
June 30, 2013
and
December 31, 2012
, as applicable.
|
(2)
|
The Level 3 estimated fair value was determined to be the carrying amount due to our ability to call this debt at anytime without penalty.
|
(3)
|
The Level 3 estimated fair value was determined to be the principal amount due to our ability to call this debt at anytime without penalty.
|
|
|
June 30,
|
|
December 31,
|
||||
|
|
2013
|
|
2012
|
||||
Interest and related debt fees
|
|
$
|
73,919
|
|
|
$
|
16,327
|
|
Affiliate
|
|
44,744
|
|
|
5,744
|
|
||
LNG liquefaction costs
|
|
375,090
|
|
|
26,131
|
|
||
LNG terminal costs
|
|
1,047
|
|
|
977
|
|
||
Other
|
|
7,635
|
|
|
4,413
|
|
||
Total accrued liabilities (including affiliate)
|
|
$
|
502,435
|
|
|
$
|
53,592
|
|
|
|
June 30,
|
|
December 31,
|
||||
|
|
2013
|
|
2012
|
||||
Long-term debt
|
|
|
|
|
||||
2016 Notes
|
|
$
|
1,665,500
|
|
|
$
|
1,665,500
|
|
2020 Notes
|
|
420,000
|
|
|
420,000
|
|
||
2021 Sabine Pass Liquefaction Senior Notes
|
|
2,000,000
|
|
|
—
|
|
||
2023 Sabine Pass Liquefaction Senior Notes
|
|
1,000,000
|
|
|
—
|
|
||
2012 Liquefaction Credit Facility
|
|
—
|
|
|
100,000
|
|
||
2013 Liquefaction Credit Facilities
|
|
100,000
|
|
|
—
|
|
||
CTPL Credit Facility
|
|
400,000
|
|
|
—
|
|
||
Total long-term debt
|
|
5,585,500
|
|
|
2,185,500
|
|
||
Long-term debt premium (discount)
|
|
|
|
|
||||
2016 Notes
|
|
(16,040
|
)
|
|
(18,387
|
)
|
||
2021 Sabine Pass Liquefaction Senior Notes
|
|
12,118
|
|
|
—
|
|
||
CTPL Credit Facility
|
|
(9,570
|
)
|
|
—
|
|
||
Total long-term debt, net
|
|
$
|
5,572,008
|
|
|
$
|
2,167,113
|
|
|
|
Six Months Ended June 30,
|
||||||
|
|
2013
|
|
2012
|
||||
LNG terminal costs funded with accounts payable and accrued liabilities (including affiliate)
|
|
$
|
450,767
|
|
|
$
|
8,588
|
|
Cash paid during the period for interest, net of amounts capitalized
|
|
$
|
9,347
|
|
|
$
|
82,383
|
|
|
|
|
|
|
|
|
|
Total Distribution (in thousands)
|
||||||||||||||||
Date Paid
|
|
Period Covered by Distribution
|
|
Distribution Per Common Unit
|
|
Distribution Per Subordinated Unit
|
|
Common Units
|
|
Class B Units
|
|
Subordinated Units
|
|
General Partner Units
|
||||||||||
February 14, 2013
|
|
October 1 - December 31, 2012
|
|
$
|
0.425
|
|
|
$
|
—
|
|
|
$
|
16,783
|
|
|
—
|
|
|
—
|
|
|
$
|
342
|
|
May 15, 2013
|
|
January 1 - March 31, 2013
|
|
0.425
|
|
|
—
|
|
|
24,259
|
|
|
—
|
|
|
—
|
|
|
495
|
|
|
|
|
|
Limited Partner Units
|
|
|
||||||||||||||
|
|
Total
|
|
Common Units
|
|
Class B Units
|
|
Subordinated Units
|
|
General Partner
|
||||||||||
Three Months Ended June 30, 2013
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net loss attributable to partners
|
|
$
|
(37,862
|
)
|
|
|
|
|
|
|
|
|
||||||||
Declared distributions
|
|
24,754
|
|
|
24,259
|
|
|
—
|
|
|
—
|
|
|
495
|
|
|||||
Assumed allocation of undistributed net loss
|
|
$
|
(62,616
|
)
|
|
(18,199
|
)
|
|
—
|
|
|
(43,165
|
)
|
|
(1,252
|
)
|
||||
Assumed allocation of net income (loss)
|
|
|
|
$
|
6,060
|
|
|
$
|
—
|
|
|
$
|
(43,165
|
)
|
|
$
|
(757
|
)
|
||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Weighted average units outstanding
|
|
|
|
57,079
|
|
|
137,817
|
|
|
135,384
|
|
|
|
|||||||
Net income (loss) per unit
|
|
|
|
$
|
0.11
|
|
|
$
|
—
|
|
|
$
|
(0.32
|
)
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Three Months Ended June 30, 2012
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net loss attributable to partners
|
|
$
|
(24,861
|
)
|
|
|
|
|
|
|
|
|
||||||||
Declared distributions
|
|
13,612
|
|
|
13,340
|
|
|
—
|
|
|
—
|
|
|
272
|
|
|||||
Amortization of beneficial conversion feature of Class B Units
|
|
—
|
|
|
(892
|
)
|
|
4,737
|
|
|
(3,845
|
)
|
|
|
||||||
Assumed allocation of undistributed net loss
|
|
$
|
(38,473
|
)
|
|
(7,096
|
)
|
|
—
|
|
|
(30,608
|
)
|
|
(769
|
)
|
||||
Assumed allocation of net income (loss)
|
|
|
|
$
|
5,352
|
|
|
$
|
4,737
|
|
|
$
|
(34,453
|
)
|
|
$
|
(497
|
)
|
||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Weighted average units outstanding
|
|
|
|
31,328
|
|
|
2,442
|
|
|
135,384
|
|
|
|
|||||||
Net income (loss) per unit
|
|
|
|
$
|
0.17
|
|
|
$
|
1.94
|
|
|
$
|
(0.25
|
)
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Six Months Ended June 30, 2013
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net loss attributable to partners
|
|
$
|
(80,349
|
)
|
|
|
|
|
|
|
|
|
||||||||
Declared distributions
|
|
49,508
|
|
|
48,518
|
|
|
—
|
|
|
—
|
|
|
990
|
|
|||||
Assumed allocation of undistributed net loss
|
|
$
|
(129,857
|
)
|
|
(37,741
|
)
|
|
—
|
|
|
(89,519
|
)
|
|
(2,597
|
)
|
||||
Assumed allocation of net income (loss)
|
|
|
|
$
|
10,777
|
|
|
$
|
—
|
|
|
$
|
(89,519
|
)
|
|
$
|
(1,607
|
)
|
||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Weighted average units outstanding
|
|
|
|
51,345
|
|
|
135,587
|
|
|
135,384
|
|
|
|
|||||||
Net income (loss) per unit
|
|
|
|
$
|
0.21
|
|
|
$
|
—
|
|
|
$
|
(0.66
|
)
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Six Months Ended June 30, 2012
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net loss attributable to partners
|
|
$
|
(44,193
|
)
|
|
|
|
|
|
|
|
|
||||||||
Declared distributions
|
|
27,207
|
|
|
26,663
|
|
|
—
|
|
|
—
|
|
|
544
|
|
|||||
Amortization of beneficial conversion feature of Class B Units
|
|
—
|
|
|
(892
|
)
|
|
4,737
|
|
|
(3,845
|
)
|
|
|
||||||
Assumed allocation of undistributed net loss
|
|
$
|
(71,400
|
)
|
|
(13,169
|
)
|
|
—
|
|
|
(56,803
|
)
|
|
(1,428
|
)
|
||||
Assumed allocation of net income (loss)
|
|
|
|
$
|
12,602
|
|
|
$
|
4,737
|
|
|
$
|
(60,648
|
)
|
|
$
|
(884
|
)
|
||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Weighted average units outstanding
|
|
|
|
31,173
|
|
|
1,221
|
|
|
135,384
|
|
|
|
|||||||
Net income (loss) per unit
|
|
|
|
$
|
0.40
|
|
|
$
|
3.88
|
|
|
$
|
(0.45
|
)
|
|
|
•
|
statements regarding our ability to pay distributions to our unitholders;
|
•
|
statements regarding our expected receipt of cash distributions from Sabine Pass LNG, L.P. ("Sabine Pass LNG"), Sabine Pass Liquefaction, LLC ("Sabine Pass Liquefaction") or Cheniere Creole Trail Pipeline, L.P. ("CTPL");
|
•
|
s
tatements regarding future levels of domestic and international natural gas production, supply or consumption or future levels of liquefied natural gas ("LNG") imports into or exports from North America and other countries worldwide, regardless of the source of such information, or the transportation or demand for and prices related to natural gas, LNG or other hydrocarbon products
;
|
•
|
statements regarding any financing transactions or arrangements, or ability to enter into such transactions;
|
•
|
statements relating to the construction of our natural gas liquefaction trains ("Trains"), including statements concerning the engagement of any engineering, procurement and construction ("EPC") contractor or other contractor and the anticipated terms and provisions of any agreement with any EPC or other contractor, and anticipated costs related thereto;
|
•
|
statements regarding any agreement to be entered into or performed substantially in the future, including any revenues anticipated to be received and the anticipated timing thereof, and statements regarding the amounts of total LNG regasification, liquefaction or storage capacities that are, or may become, subject to contracts;
|
•
|
statements regarding counterparties to our commercial contracts, construction contracts and other contracts;
|
•
|
statements regarding our planned construction of additional Trains, including the financing of such Trains;
|
•
|
statements that our Trains, when completed, will have certain characteristics, including amounts of liquefaction capacities;
|
•
|
statements regarding our business strategy, our strengths, our business and operation plans or any other plans, forecasts, projections or objectives, including anticipated revenues and capital expenditures, any or all of which are subject to change;
|
•
|
statements regarding legislative, governmental, regulatory, administrative or other public body actions, requirements, permits, investigations, proceedings or decisions;
|
•
|
statements regarding our anticipated LNG and natural gas marketing activities; and
|
•
|
any other statements that relate to non-historica
l or future information.
|
•
|
Overview of Business
|
•
|
Overview of Significant Events
|
•
|
Liquidity and Capital Resources
|
•
|
Results of Operations
|
•
|
Off-Balance Sheet Arrangements
|
•
|
Summary of Critical Accounting Policies and Estimates
|
•
|
Recent Accounting Standards
|
•
|
Sabine Pass Liquefaction issued an aggregate principal amount of $2.0 billion of 5.625% Senior Secured Notes due 2021 (the "2021 Sabine Pass Liquefaction Senior Notes") and an aggregate principal amount of $1.0 billion of 5.625% Senior Secured Notes due 2023 (the "2023 Sabine Pass Liquefaction Senior Notes"). Net proceeds from these offerings are intended to be used to pay a portion of the capital costs incurred in connection with the construction of the Liquefaction Project;
|
•
|
We sold 17.6 million common units to institutional investors for net proceeds, after deducting expenses, of $372.4 million, which includes the general partner's proportionate capital contribution of approximately $7.4 million. We intend to use the proceeds from this offering for costs associated with the Liquefaction Project and for general business purposes;
|
•
|
Sabine Pass Liquefaction entered into four credit facilities totaling $5.9 billion to be used for costs associated with Trains 1 through 4 of the Liquefaction Project;
|
•
|
Sabine Pass Liquefaction issued a notice to proceed to Bechtel Oil, Gas and Chemicals, Inc. ("Bechtel") under the lump sum turnkey contract for the engineering, procurement and construction of Trains 3 and 4 (the "EPC Contract (Trains 3 and 4)");
|
•
|
Sabine Pass Liquefaction entered into an LNG sale and purchase agreement ("SPA") with Centrica plc that commences upon the date of first commercial delivery for Train 5 and includes an annual contract quantity of 91.25 million MMBtu of LNG with a fixed fee of $3.00 per MMBtu, equating to expected annual contracted cash flow from fixed fees of $274 million;
|
•
|
We completed the acquisition of 100% of the equity interests in Cheniere Pipeline GP Interests, LLC held by Cheniere Pipeline Company, and the limited partner interest in CTPL held by Grand Cheniere Pipeline, LLC ("the Creole Trail Pipeline Business"). We acquired the Creole Trail Pipeline Business for $480.0 million and reimbursed Cheniere $13.9 million for certain expenditures incurred prior to the closing date. Concurrent with the Creole Trail Pipeline Business acquisition closing, we issued 12.0 million Class B units to Cheniere for aggregate consideration of $180.0 million pursuant to a unit purchase agreement with Cheniere Class B Units Holdings, LLC, a wholly owned subsidiary of Cheniere. As a result of the two transactions, we paid Cheniere net cash of $313.9 million;
|
•
|
CTPL entered into a $400 million term loan credit facility to fund capital expenditures on the Creole Trail Pipeline and for general business purposes; and
|
•
|
We entered into an equity distribution agreement with Mizuho Securities USA Inc., under which we may sell up to $500.0 million of common units through an at-the-market program.
|
•
|
Total Gas & Power North America, Inc. ("Total") has reserved approximately 1.0 Bcf/d of regasification capacity and is obligated to make monthly capacity payments to Sabine Pass LNG aggregating approximately $125 million annually for 20 years that commenced April 1, 2009. Total, S.A. has guaranteed Total’s obligations under its TUA of approximately $2.5 billion, subject to certain exceptions; and
|
•
|
Chevron U.S.A. Inc. ("Chevron") has reserved approximately 1.0 Bcf/d of regasification capacity and is obligated to make monthly capacity payments to Sabine Pass LNG aggregating approximately $125 million annually for 20 years that commenced July 1, 2009. Chevron Corporation has guaranteed Chevron’s obligations under its TUA up to 80% of the fees payable by Chevron.
|
•
|
BG Gulf Coast LNG, LLC ("BG") has entered into an SPA that commences upon the date of first commercial delivery for Train 1 and includes an annual contract quantity of 182,500,000 MMBtu of LNG with a fixed fee of $2.25 per MMBtu and includes additional annual contract quantities of 36,500,000 MMBtu, 34,000,000 MMBtu, and 33,500,000 MMBtu upon the date of first commercial delivery for Train 2, Train 3 and Train 4, respectively, with a fixed fee of $3.00 per
|
•
|
Gas Natural Aprovisionamientos SDG S.A.("Gas Natural Fenosa"), an affiliate of Gas Natural SDG, S.A.,
has entered into an SPA that
commences upon the date of first commercial delivery for Train 2 and includes an annual contract quantity of 182,500,000 MMBtu of LNG with a fixed fee of $2.49 per MMBtu, equating to expected annual contracted cash flow from the fixed fee component of
approximately
$454 million. In addition, Sabine Pass Liquefaction has agreed to make up to 285,000 MMBtu per day of LNG available to Gas Natural Fenosa to the extent that Train 2 becomes commercially operable prior to the beginning of the first delivery window priced at 115% of the Henry Hub price plus $2.49 per MMBtu, if produced. The obligations of Gas Natural Fenosa are guaranteed by Gas Natural SDG S.A., a company organized under the laws of Spain, with a credit rating of Baa2/BBB.
|
•
|
Korea Gas Corporation ("KOGAS")
has entered into an SPA that commences upon the date of first commercial delivery for Train 3 and includes an annual contract quantity of 182,500,000 MMBtu of LNG with a fixed fee of $3.00 per MMBtu, equating to expected annual contracted cash flow from fixed fees of approximately $548 million. KOGAS is organized under the laws of the Republic of Korea, with a credit rating of A/A1.
|
•
|
GAIL (India) Limited ("
GAIL") has entered into an SPA that commences upon the date of first commercial delivery for Train 4 and includes an annual contract quantity of 182,500,000 MMBtu of LNG with a fixed fee of $3.00 per MMBtu, equating to expected annual contracted cash flow from fixed fees of approximately $548 million. GAIL is organized under the laws of India, with a credit rating of Baa2/BBB-.
|
•
|
Total,
an affiliate of Total S.A., has entered into an SPA that commences upon the date of first commercial delivery for Train 5 and includes an annual contract quantity of 104,750,000 MMBtu of LNG with a fixed fee of $3.00 per MMBtu, equating to expected annual contracted cash flow from fixed fees of approximately $314 million. The obligations of Total are guaranteed by Total S.A., a company orga
nized under the laws of France, with a credit rating of Aa1/AA.
|
•
|
Centrica plc ("Centrica")
has entered into an SPA that
commences upon the date of first commercial delivery for Train 5 and includes an annual contract quantity of 91,250,000 MMBtu of LNG with a fixed fee of $3.00 per MMBtu, equating to expected annual contracted cash flow from fixed fees of
approximately
$274 million. Centrica is organized under the laws of England and Wales, with a credit rating o
f A-/A3/A.
|
|
|
Six Months Ended June 30,
|
||||||
|
|
2013
|
|
2012
|
||||
Sources of cash and cash equivalents
|
|
|
|
|
||||
Proceeds from debt issuances
|
|
$
|
3,504,478
|
|
|
$
|
—
|
|
Proceeds from the sale of partnership common and general partner units
|
|
375,917
|
|
|
12,379
|
|
||
Proceeds from sale of Class B units
|
|
—
|
|
|
166,667
|
|
||
Contributions to Creole Trail Pipeline Business from Cheniere, net
|
|
20,705
|
|
|
4,449
|
|
||
Total sources of cash and cash equivalents
|
|
3,901,100
|
|
|
183,495
|
|
||
|
|
|
|
|
||||
Uses of cash and cash equivalents
|
|
|
|
|
||||
Investment in restricted cash and cash equivalents
|
|
(1,980,930
|
)
|
|
—
|
|
||
LNG terminal costs, net
|
|
(1,271,830
|
)
|
|
(39,223
|
)
|
||
Purchase of Creole Trail Pipeline Business, net
|
|
(313,892
|
)
|
|
—
|
|
||
Debt issuance and deferred financing costs
|
|
(228,882
|
)
|
|
(5,530
|
)
|
||
Repayment of 2012 Liquefaction Credit Facility
|
|
(100,000
|
)
|
|
—
|
|
||
Distributions to unitholders
|
|
(41,879
|
)
|
|
(27,040
|
)
|
||
Operating cash flow
|
|
(24,685
|
)
|
|
(17,452
|
)
|
||
Other
|
|
(2,990
|
)
|
|
(4,714
|
)
|
||
Total uses of cash and cash equivalents
|
|
(3,965,088
|
)
|
|
(93,959
|
)
|
||
|
|
|
|
|
||||
Net increase (decrease) in cash and cash equivalents
|
|
(63,988
|
)
|
|
89,536
|
|
||
Cash and cash equivalents—beginning of period
|
|
419,292
|
|
|
81,415
|
|
||
Cash and cash equivalents—end of period
|
|
$
|
355,304
|
|
|
$
|
170,951
|
|
|
|
|
|
|
|
|
|
Total Distribution (in thousands)
|
||||||||||||||||
Date Paid
|
|
Period Covered by Distribution
|
|
Distribution Per Common Unit
|
|
Distribution Per Subordinated Unit
|
|
Common Units
|
|
Class B Units
|
|
Subordinated Units
|
|
General Partner Units
|
||||||||||
February 14, 2013
|
|
October 1 - December 31, 2012
|
|
$
|
0.425
|
|
|
$
|
—
|
|
|
$
|
16,783
|
|
|
—
|
|
|
—
|
|
|
$
|
342
|
|
May 15, 2013
|
|
January 1 - March 31, 2013
|
|
0.425
|
|
|
—
|
|
|
24,259
|
|
|
—
|
|
|
—
|
|
|
495
|
|
|
|
December 31, 2016
|
|
December 31, 2017
|
|
December 31, 2018
|
|
July 9, 2019
|
Cheniere:
|
|
|
|
|
|
|
|
|
Number of Common Units
|
|
84,357
|
|
96,792
|
|
110,060
|
|
119,362
|
Percentage Ownership
|
|
49.4%
|
|
47.9%
|
|
46.5%
|
|
45.8%
|
Blackstone:
|
|
|
|
|
|
|
|
|
Number of Common Units
|
|
182,881
|
|
209,782
|
|
240,640
|
|
258,550
|
Percentage Ownership
|
|
39.0%
|
|
41.2%
|
|
43.3%
|
|
44.4%
|
Hedge Description
|
|
Hedge Instrument
|
|
Contract Volume (MMBtu)
|
|
Price Range ($/MMBtu)
|
|
Final Hedge Maturity Date
|
|
Fair Value (in thousands)
|
|
VaR (in thousands)
|
||||
LNG Inventory Derivatives
|
|
Fixed price natural gas swaps
|
|
830,000
|
|
$3.690 - $4.319
|
|
November 2013
|
|
$
|
764
|
|
|
$
|
14
|
|
Fuel Derivatives
|
|
Fixed price natural gas swaps
|
|
912,000
|
|
3.559 - 3.903
|
|
May 2014
|
|
(200
|
)
|
|
19
|
|
Hedge Description
|
|
Initial Notional Amount (in thousands)
|
|
Maximum Notional Amount (in thousands)
|
|
Fixed Interest Rate Range (%)
|
|
Final Hedge Maturity Date
|
|
Fair Value (in thousands)
|
|
10% Change in LIBOR (in thousands)
|
||||
Interest Rate Derivatives - Not Designated
|
|
$20.0 million
|
|
$3.6 billion
|
|
1.99%
|
|
May 2020
|
|
$
|
78,207
|
|
|
$
|
32,067
|
|
Exhibit No.
|
|
Description
|
10.1*
|
|
Amended and Restated Operation and Maintenance Services Agreement, dated May 27, 2013, by and between Cheniere Energy Partners GP, LLC and Cheniere Creole Trail Pipeline, L.P.
|
|
|
|
10.2*
|
|
Management Services Agreement, dated May 27, 2013, by and between Cheniere LNG Terminals, LLC and Cheniere Creole Trail Pipeline, L.P.
|
|
|
|
10.3
|
|
Letter Agreement, dated May 28, 2013, by and between Sabine Pass Liquefaction, LLC and Sabine Pass LNG, L.P. (Incorporated by reference to Exhibit 10.1 to Sabine Pass LNG, L.P.'s Quarterly Report on Form 10-Q (SEC File No. 138916), filed on August 2, 2013)
|
|
|
|
10.4*
|
|
Change orders to the Lump Sum Turnkey Agreement for the Engineering, Procurement and Construction of the Sabine Pass LNG Liquefaction Facility, dated as of November 11, 2011, between Sabine Pass Liquefaction, LLC and Bechtel Oil, Gas and Chemicals, Inc.: (i) the Change Order CO-0021 Increase to Insurance Provisional Sum, dated April 17, 2013, (ii) the Change Order CO-0022 Removal of LNG Static Mixer Scope, dated May 8, 2013, (iii) the Change Order CO-0023 Revised LNG Rundown Line, dated May 30, 2013, (iv) the Change Order CO-0024 Reroute Condensate Header, Substation HVAC Stacks, Inlet Metering Station Pile Driving, dated June 11, 2013 and (v) the Change Order CO-0025 Feed Gas Connection Modifications, dated June 11, 2013. (Portions of this exhibit have been omitted and filed separately with the SEC pursuant to a request for confidential treatment.)
|
|
|
|
10.5*
|
|
Change orders to the Lump Sum Turnkey Agreement for the Engineering, Procurement and Construction of the Sabine Pass LNG Stage 2 Liquefaction Facility, dated as of December 20, 2012, between Sabine Pass Liquefaction, LLC and Bechtel Oil, Gas and Chemicals, Inc.: (i) the Change Order CO-0001 Electrical Station HVAC Stacks, dated May 30, 2013, (ii) the Change Order CO-0002 Revised LNG Rundown Line, dated May 30, 2013, (iii) the Change Order CO-0003 Currency Provisional Sum Closure, dated May 30, 2013 and (iv) the Change Order CO-0004 Fuel Provisional Sum Closure, dated June 4, 2013. (Portions of this exhibit have been omitted and filed separately with the SEC pursuant to a request for confidential treatment.)
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|
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10.6*ƒ
|
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Letter Agreement, dated June 23, 2013, by and between Cheniere Energy Partners, L.P. and Blackstone CQP Holdco LP; Letter Agreement, dated June 14, 2013, by and among Blackstone CQP Holdco LP, Philip Meier and Meier Consulting LLC
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10.7*ƒ
|
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Form of Phantom Units Agreement under the Cheniere Energy Partners, L.P. Long-Term Incentive Plan
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31.1*
|
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Certification by Chief Executive Officer required by Rule 13a-14(a) and 15d-14(a) under the Exchange Act
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31.2*
|
|
Certification by Chief Financial Officer required by Rule 13a-14(a) and 15d-14(a) under the Exchange Act
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32.1**
|
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Certification by Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
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32.2**
|
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Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
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|
|
101.INS+
|
|
XBRL Instance Document
|
|
|
|
101.SCH+
|
|
XBRL Taxonomy Extension Schema Document
|
|
|
|
101.CAL+
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
|
|
101.DEF+
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
|
|
|
101.LAB+
|
|
XBRL Taxonomy Extension Labels Linkbase Document
|
|
|
|
101.PRE+
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
|
|
|
|
*
|
Filed herewith
|
|
|
**
|
Furnished herewith.
|
|
|
ƒ
|
Management contract or compensatory plan or arrangement
|
+
|
Pursuant to Rule 406T of Regulation S-T, the interactive data files on Exhibit 101 hereto are deemed not filed or part of a registration statement or prospectus for purposes of Section 11 or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise are not subject to liability under those sections.
|
CHENIERE ENERGY PARTNERS, L.P.
|
||
By:
|
Cheniere Energy Partners GP, LLC,
its general partner
|
|
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|
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By:
|
/s/ JERRY D. SMITH
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Jerry D. Smith
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Chief Accounting Officer
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(on behalf of the registrant and as principal accounting officer)
|
|
Date:
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August 2, 2013
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Article I. DEFINITIONS AND INTERPRETATION
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1
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1.1
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Definitions
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1
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1.2
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Rules of Construction
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9
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Article II. APPOINTMENT OF OPERATOR AND TERM
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9
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2.1
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Appointment
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9
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2.2
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Term
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10
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Article III. SCOPE OF SERVICES
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10
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3.1
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Generally
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10
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3.2
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Services
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10
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3.3
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Operator to Act as Independent Contractor
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10
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3.4
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Exclusions from Services
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10
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3.5
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Cooperation and Coordination with Manager
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11
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3.6
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Risk of Loss
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11
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3.7
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Standard for Performance of Obligations
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11
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3.8
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Government Approvals
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12
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3.9
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Liens
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12
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3.10
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Qualification to Operator's Obligations
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12
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3.11
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Federal DOT Operator Qualification
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13
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Article IV. RESPONSIBILITIES AND RIGHTS OF OWNER
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13
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4.1
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Owner Responsibilities
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13
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4.2
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Owner's Retained Rights
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14
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4.3
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Review and Approval
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15
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4.4
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Government Approvals
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15
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Article V. O&M EMPLOYEES AND REPRESENTATIVES OF PARTIES
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15
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5.1
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O&M Employees; Subcontractors
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15
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5.2
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Employee Compliance with Regulations
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15
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5.3
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Representative of Operator
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16
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5.4
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Representative of Owner
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16
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5.5
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Operator Employment of O&M Employees
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17
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5.6
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Statutory Employees for Purposes of Louisiana Worker's Compensation
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Act
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17
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Article VI. INFORMATION, REPORTS, AUDITS, RECORDS AND FERC
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REQUIREMENTS
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17
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6.1
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Information; Project Contracts
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17
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6.2
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Reports and Written Notices.
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18
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6.3
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Cooperation With and Reporting to Governmental Authorities
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19
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6.4
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Notice of Certain Matters
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21
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6.5
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Notice of Other Matter
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21
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6.6
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Books and Record
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21
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6.7
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Audits
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22
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Article VII. OPERATING PLANS AND BUDGETS
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22
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7.1
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Maintenance Program
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22
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7.2
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Operating Plans and Budget
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22
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7.3
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Approval of Operating Plans, Budgets, and Maintenance Program
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23
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7.4
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Changes in Plans or Budgets
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24
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7.5
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Monthly Meetings; Modification of Operating Plan
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25
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7.6
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Deviation
|
25
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Article VIII. CAPITAL BUDGET
|
25
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||
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8.1
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Capital Budget Submittal
|
25
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8.2
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Capital Budget Approval
|
26
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8.3
|
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Commencement of Capital Projects
|
26
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8.4
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Additional Work Orders, Amendment, and Cancellation
|
26
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8.5
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Work Order Variances
|
27
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Article IX. RESPONSIBILITY FOR COSTS AND EXPENSES
|
27
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9.1
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Owner and Operator Responsibility; Procurement of Materials and
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9.2
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Services
|
27
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9.3
|
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Operating Expenses
|
27
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9.4
|
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Limitations
|
29
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9.5
|
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O&M Account
|
29
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9.6
|
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Estimated Operating Expenses
|
29
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9.7
|
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Billing Reports
|
30
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9.8
|
|
Budget Reconciliation
|
30
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9.9
|
|
Taxes
|
30
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Article X. FORCE MAJEURE
|
31
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10.1
|
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Nonperformance
|
31
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10.2
|
|
Obligation to Diligently Cure Force Majeure
|
31
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10.3
|
|
Effect of Continued Event of Force Majeure
|
31
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10.4
|
|
Labor Matters Exception
|
32
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|
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Article XI. EVENTS OF DEFAULT AND REMEDIES
|
32
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|
||
|
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|
11.1
|
|
Operator Events of Default
|
32
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11.2
|
|
Owner Events of Default
|
32
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11.3
|
|
Remedies
|
33
|
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11.4
|
|
Termination Procedure
|
33
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11.5
|
|
Successor to Operator
|
33
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11.6
|
|
Survival of Certain Provisions
|
34
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|
|
Article XII. INDEMNIFICATION
|
34
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|
||
|
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|
12.1
|
|
Loss or Damage to the Facilities
|
34
|
|
|
12.2
|
|
Operator Indemnity
|
34
|
|
|
12.3
|
|
Owner Indemnity
|
35
|
|
|
12.4
|
|
Louisiana Oilfield Anti-Indemnity Act
|
36
|
|
|
|
12.5
|
|
Other Indemnity Rules
|
36
|
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|
||
|
Article XIII
|
36
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|
|||
|
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|
|
|
||
|
LIMITATION OF LIABILITY
|
36
|
|
|||
|
|
|
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|
||
|
13.1
|
|
Limitation of Liability
|
36
|
|
|
|
13.2
|
|
CONSEQUENTIAL DAMAGES
|
36
|
|
|
|
|
|
|
|
||
|
Article XIV. INSURANCE
|
|
||||
|
|
|
|
|
||
|
14.1
|
|
Operator's Insurance Responsibilities
|
37
|
|
|
|
14.2
|
|
Owner's Insurance Responsibilities
|
37
|
|
|
|
14.3
|
|
Subcontractors' Insurance
|
37
|
|
|
|
14.4
|
|
Insurance Policies
|
37
|
|
|
|
14.5
|
|
Other Requirements and Insurance Certificates
|
37
|
|
|
|
14.6
|
|
Budget
|
38
|
|
|
|
14.7
|
|
Disclosure of Claims
|
38
|
|
|
|
|
|
|
|
||
|
Article XV. ASSIGNMENT
|
38
|
|
|||
|
|
|
|
|
||
|
15.1
|
|
|
Assignment
|
38
|
|
|
|
|
|
|
||
|
Article XVI. CONFIDENTIALITY
|
38
|
|
|||
|
|
|
|
|
||
|
16.1
|
|
Confidential Information
|
38
|
|
|
|
16.2
|
|
Permitted Disclosure
|
39
|
|
|
|
16.3
|
|
Additional Undertakings of Operator
|
39
|
|
|
|
16.4
|
|
Public Announcements
|
39
|
|
|
|
|
|
|
|
||
|
Article XVII. EMERGENCIES
|
40
|
|
|||
|
|
|
|
|
||
|
17.1
|
|
Emergencies
|
40
|
|
|
|
17.2
|
|
Notice; Further Action
|
40
|
|
|
|
17.3
|
|
Owner's Notice
|
40
|
|
|
|
|
|
|
|
||
|
Article XVIII. DISPUTE RESOLUTION
|
40
|
|
|||
|
|
|
|
|
||
|
18.1
|
|
Negotiation
|
40
|
|
|
|
18.2
|
|
Arbitration
|
41
|
|
|
|
18.3
|
|
Continuation of Work During Dispute
|
41
|
|
|
|
|
|
|
|
||
|
Article XIX. NOTICES
|
42
|
|
|||
|
|
|
|
|
||
|
19.1
|
|
Notice
|
42
|
|
|
|
19.2
|
|
Effective Time of Notice
|
42
|
|
|
|
|
|
|
|
||
|
Article XX. REPRESENTATIONS AND WARRANTIES
|
43
|
|
|||
|
|
|
|
|
||
|
20.1
|
|
Representations and Warranties by Each Party
|
43
|
|
|
|
20.2
|
|
Additional Representations and Warranties by Operator
|
44
|
|
|
|
20.3
|
|
OWNER'S DISCLAIMER
|
44
|
|
|
|
20.4
|
|
DISCLAIMER OF ALL OTHER WARRANTIES
|
44
|
|
|
|
|
|
|
|
||
|
Article XXI. MISCELLANEOUS
|
44
|
|
|||
|
|
|
|
|
|
21.1
|
|
Severability
|
44
|
|
|
21.2
|
|
Entire Agreement
|
44
|
|
|
21.3
|
|
Amendment
|
44
|
|
|
21.4
|
|
Additional Documents and Actions
|
45
|
|
|
21.5
|
|
Schedules
|
45
|
|
|
21.6
|
|
Interest for Late Payment
|
45
|
|
|
21.7
|
|
Services-Only Contract
|
45
|
|
|
21.8
|
|
Counterparts
|
45
|
|
|
21.9
|
|
Governing Law
|
45
|
|
|
21.10
|
|
No Third Party Beneficiary
|
45
|
|
|
21.11
|
|
No Partnership
|
45
|
|
(a)
|
words imparting the singular shall include the plural and vice versa;
|
(b)
|
a reference in this Agreement to any Article, Section, clause, or paragraph is, except where it is expressly stated to the contrary or the context otherwise requires, a reference to such Article, Section, clause, or paragraph herein;
|
(c)
|
headings are for convenience of reference only and shall not be used for purposes of construction or interpretation of this Agreement;
|
(d)
|
each reference to any Applicable Law shall be construed as a reference to such Applicable Law as it may have been, or may from time to time be, amended, replaced, or re-enacted and shall include any rule or regulation promulgated under any such Applicable Law;
|
(e)
|
the terms “hereof,” “herein,” “hereto,” “hereunder,” and words of similar or like import, refer to this entire Agreement and not any one particular Article, Section, Schedule, or other subdivision of this Agreement;
|
(f)
|
any accounting terms used but not expressly defined herein shall have the meanings given to them under GAAP as consistently applied by the Person to which they relate;
|
(g)
|
the word “including” and its syntactical variants means “includes, but not limited to” and corresponding syntactical variant expressions;
|
(h)
|
in computing any period of time prescribed or allowed under this Agreement, the Day of the act, event, or default from which the designated period of time begins to run shall be included and if the last Day of the period so computed is not a business day in the place where performance is due, then the period shall run until the close of business on the immediately succeeding business day; and
|
(i)
|
this Agreement shall be deemed to be the work product of each Party hereto, and there shall be no presumption that an ambiguity should be construed in favor of or against Owner or Operator solely as a result of such Party's actual or alleged role in the drafting of this Agreement.
|
(a)
|
describe itself as agent or representative of Owner;
|
(b)
|
pledge the credit of Owner in any way in respect of any commitments for which it has not received written authorization from Owner;
|
(c)
|
make any warranty or representation relating to Owner;
|
(d)
|
sell, lease, pledge, mortgage, encumber, convey, license, exchange, or make any other transfer, assignment, or disposition of the Facilities or any other property or assets of Owner;
|
(e)
|
except for Disputes between Operator and Owner arising under this Agreement, settle, compromise, assign, pledge, transfer, release, waive, or consent to the compromise, assignment, settlement, pledge, transfer, waiver, or release of, any claim, suit, debt, demand, or judgment against or due by Owner, or submit any such claim, dispute, or controversy to arbitration or judicial process, or stipulate to a judgment or consent with respect thereto;
|
(f)
|
make, enter into, execute, amend, modify, or supplement any Project Contract or any other contract or agreement on behalf of, or in the name of, Owner;
|
(g)
|
engage in any other transaction on behalf of, or in the name of, Owner which is not expressly permitted by this Agreement;
|
(h)
|
provide administrative, financial, tax or other commercial services with respect to the business of Owner except to the extent they relate solely to the operation and maintenance of the Facilities; or
|
(i)
|
exercise any of the Retained Rights.
|
3.5
|
Cooperation and Coordination with Manager
. During the Operating Period, Operator agrees that it shall cooperate with the Manager to ensure that the operation and maintenance of the Facilities is performed in a manner required by the Project Contracts and in accordance with this Agreement.
|
3.6
|
Risk of Loss
. Since November 26, 2007, Operator has been, and Operator shall continue be, responsible for the operation and maintenance of the Facilities and shall ensure that all necessary Services required to operate and maintain the Facilities are properly performed in accordance with the terms hereof. Except as otherwise provided herein, Operator does not have risk of loss for the Facilities, or Natural Gas owned by Customers or Owner.
|
3.7
|
Standard for Performance of Obligations
. In the performance of Services hereunder, Operator shall not use any tangible assets of Owner for Operator's own benefit (except in the exercise of its rights and obligations under this Agreement) or for the benefit of Operator's Affiliates (other than Cheniere Energy Partners, L.P. and its subsidiaries) without the written consent of Owner which consent will not be unreasonably withheld. Operator will not engage in any Discriminatory Practice with respect to the performance of its obligations under this Agreement which adversely affects its performance of its obligations to the Owner under this Agreement. Operator shall operate and maintain the Facilities and perform all the Services hereunder in a good and workmanlike manner consistent with the performance of a prudent operator under the same or similar circumstances and in accordance with:
|
(a)
|
all Applicable Laws;
|
(b)
|
all Government Approvals, including the FERC Authorization;
|
(c)
|
the Project Contracts;
|
(d)
|
the terms of Operator's and Owner's insurance policies;
|
(e)
|
the terms of this Agreement;
|
(f)
|
the applicable Approved Operating Plan, Approved Budget, Approved Capital Budget and Approved Maintenance Program;
|
(g)
|
the Standing Procedures; and
|
(h)
|
the instructions of the Manager in accordance with the terms of the Management Service Agreement.
|
3.8
|
Government Approvals
. Operator shall procure, obtain, maintain and comply with all Government Approvals, including all modifications, amendments and renewals of Governmental Approvals which may be required under any Applicable Laws for the operation and maintenance of the Facilities and the performance of its obligations hereunder and which need to be procured and maintained by or in the name of Operator. Owner shall provide Operator with such assistance and cooperation as may reasonably be required in order to obtain and maintain all such Government Approvals. Operator shall provide Owner and any other Person nominated by Owner with such assistance and co-operation as may be reasonably required in order to obtain and maintain all necessary Government Approvals for the operation and maintenance of the Facilities. Operator shall perform the Services, including the operation and maintenance of the Facilities in accordance with the terms and conditions of the FERC Authorization and all other Government Approvals applicable to the operation and maintenance of the Facilities.
|
3.9
|
Liens
. Operator shall not permit any Lien to be filed or otherwise imposed on any part of the Facilities as a result of the performance of the Services or its engagement or employment of any Subcontractor for the performance of the Services. If any Lien is filed as a result of Operator's breach of its responsibilities hereunder, and if Operator does not within thirty (30) days of the filing of the Lien cause such Lien to be released and discharged, or file a bond satisfactory to Owner in lieu thereof, Owner shall have the right to pay all sums necessary to obtain such release and discharge such Lien. Operator shall reimburse Owner for all such costs, including reasonable attorneys' fees, within five (5) days of Owner's written demand therefor. Notwithstanding the foregoing, Operator shall not be responsible for any Lien filed on the Facilities that was permitted by, or that arises out of or was caused by the actions of, Owner.
|
3.10
|
Qualification to Operator's Obligations
. Operator shall: (i) not be liable to Owner for any Loss suffered or incurred by Owner or any third Person and (ii) be indemnified and held harmless by Owner for any Loss suffered or incurred by Operator or in respect of the claims of any third Person to the extent in each such case that such Loss is as a direct result of:
|
(a)
|
Operator's compliance with the terms of this Agreement or any other Project Contract;
|
(b)
|
Operator's compliance with any instruction or direction given by Owner or any constraint imposed by Owner at any time upon Operator which is different from those otherwise provided by this Agreement;
|
(c)
|
Owner's failure to comply with its obligations under this Agreement, including failure to make timely payment of Operating Expenses included in the Approved Operating Plan or otherwise payable in accordance with this Agreement, or any other Project Contract (unless any such obligation was to be performed by Operator pursuant to the terms of this Agreement or any other Project Contract), which failure has an adverse effect on Operator's ability to perform the Services except to the extent that such failure is a result of any negligence, willful misconduct or breach of this Agreement by Operator;
|
(d)
|
a design, manufacturing or construction defect in the Facilities or any component incorporated therein;
|
(e)
|
the absence or lapse of any Government Approval, other than any absence or lapse resulting from Operator's failure to comply with its obligations under Section 3.8
;
|
(f)
|
a Contractor's failure to comply with its obligations under any Project Contract or any other contract between a Contractor and Owner relating to the Facilities, which failure results in Operator's inability to perform its obligations hereunder, except to the extent that such failure is a result of any negligence, willful misconduct or breach of this Agreement by Operator; or
|
(g)
|
lack of spare parts except to the extent that it is the result of any negligence, willful misconduct or breach of this Agreement by Operator.
|
(a)
|
providing and maintaining insurance in accordance with Section 14.1;
|
(b)
|
providing all public relations (except for those referred to in the Services) and assist Operator, if requested, in performing all necessary public relations activities with the local community and public agencies;
|
(c)
|
paying Operator the amounts owed under this Agreement;
|
(d)
|
complying, with Operator's assistance, with all Owner requirements in Government Approvals identified in Section 4.4
;
|
(e)
|
managing all loan or financing agreements;
|
(f)
|
submitting, with Operator's assistance pursuant to Sections 4.4 and 6.3, Tariff filings, FERC 7(c) or (b) filings and general FERC reporting, including but not limited to Form 2, Form 567, Quarterly reports, and Fuel Retainage filings; and
|
(g)
|
approving all system purchases, development, and related budgets for pipeline software systems, including, but not limited to, SCADA, GIS, Transaction Management, Measurement Accounting, Informational Posting systems.
|
(a)
|
review and determination of general policies and procedures not delegated to Operator;
|
(b)
|
approve of all press releases and publicity material relating to this Agreement or the Facilities;
|
(c)
|
approve of commitments to incur expenditures in relation to any expenditures not included in the applicable Approved Budget or Approved Capital Budget;
|
(d)
|
approve of any amendment to, waiver or revision of or termination of any Project Contract;
|
(e)
|
conduct or resolve any dispute in relation to any Project Contract (other than this Agreement in relation to Operator);
|
(f)
|
perform (or engage a third party to perform) any obligations of Operator if Operator fails to perform such obligations hereunder (which will result in a reduction in the Operating Expenses included in the Approved Operating Plan associated with such obligations equal to the reasonable costs of, or incidental to, performing (or engaging a third party to perform) such obligations);
|
(g)
|
other than routine and ordinary course matters regarding the operation and maintenance of the Facilities, with Operator's assistance pursuant to Sections 4.4 and 6.3, notify and communicate with Government Authorities regarding the Facilities;
|
(h)
|
enter and inspect the Facilities by Owner's employees or agents, to accompany or send prospective Customers to the Facilities for review, including any environmental assessment or review, and to make repairs or improvements. Prior to such access, Notice shall be given to Operator, whenever it is reasonable to do so; and
|
(i)
|
provide office space for Owner's employees, agents and others authorized by Owner and agreed to by Operator which agreement will not be unreasonably withheld to work, have meetings, conduct audits, investigations, entertain visitors and Customers, access to high speed internet network connection, private phone line, access to copiers, fax machines, use of general office supplies, toilets, showers and kitchen facilities, and capability to reserve conference rooms.
|
(a)
|
it can comply with such Additional Agreement without any amendment to this Agreement, the Services or the then-current Approved Operating Plan, Approved Maintenance Program, Approved Capital Budget or Approved Budget; or
|
(b)
|
setting forth any proposed changes to this Agreement, the Services or the then-current Approved Operating Plan, Approved Maintenance Program, Approved Capital Budget or Approved Budget and specifying the reasons why such changes are necessary.
|
(a)
|
Operation and maintenance procedures and manuals, as well as emergency plans and safety procedure manuals, shall be completed by Operator prior to commissioning operations. These documents include selected Standing Procedures as listed in Schedule 3.
|
(b)
|
Implement, maintain, and timely post on Owner's Internet website as required by FERC regulations, a written log detailing the circumstances and manner of any discretionary decisions by Owner under the terms of its FERC tariff, any tariff waivers by Owner, and any other information of Owner that is required by FEFC Standards of Conduct to be publicized.
|
(c)
|
Significant non-scheduled events, including safety-related incidents (i.e., Natural Gas releases, fires, explosions, mechanical failures, unusual over pressurization, and major injuries) shall be reported to PHMSA and FERC staff within forty-eight (48) hours or such earlier period as required by Applicable Law. In the event an abnormality is of significant magnitude to threaten public or O&M Employee safety, cause significant property damage, or interrupt service, notification shall be made immediately, without unduly interfering with any necessary or appropriate emergency repair, alarm, or other emergency procedure. This notification practice shall be incorporated into the Facilities' emergency plan. Operator shall develop for Owner any such reports that may be required during the Operating Period. Examples of reportable incidents include:
|
▪
|
Fire;
|
▪
|
Explosion;
|
▪
|
Property damage exceeding $10,000;
|
▪
|
Death or injury requiring hospitalization;
|
▪
|
Unintended movement by environmental causes, such as an earthquake, landslide, or flood, that impairs the serviceability, structural integrity, or reliability of the parts of the Facilities that contain, control, or process Natural Gas;
|
▪
|
Any crack or other material defect that impairs the structural integrity or reliability of any part of the Facilities that contains, controls, or processes Natural Gas;
|
▪
|
Any malfunction or operating error that causes the pressure of a pipeline or a part of the Facilities that contains or processes Natural Gas to rise above its maximum allowable operating pressure (or working pressure for the Facilities) plus the build-up allowed for operation of pressure limiting or control devices;
|
▪
|
A leak in a part of the Facilities that contains or processes Natural Gas that constitutes an emergency;
|
▪
|
Any safety-related condition that could lead to an imminent hazard and cause (either directly or indirectly by remedial action of the Operator), for purposes other than abandonment, a twenty percent (20%) reduction in operating pressure or shutdown of operation of a pipeline or a part of the Facilities that contains or processes Natural Gas; and
|
▪
|
Any other significant non-scheduled event which in the judgment of Operator's or Owner's personnel and/or management should be reported even though it did not meet the above criteria or the guidelines set forth in the Facilities' incident management plan.
|
(d)
|
Assist Owner with compliance with all other requirements or Applicable Laws of the FERC, PHMSA and State of Louisiana pipeline and environmental safety agencies, except as otherwise stated in this Agreement or in the Approved Operating Plan, Approved Maintenance Program, or the Standing Procedures.
|
(a)
|
any litigation or claims, disputes, or actions, pending or threatened, concerning the Facilities, any Project Contract or the Services to be performed hereunder;
|
(b)
|
any lapse or termination of any Government Approval, or any refusal or threatened refusal to grant, renew, or extend, or any action pending or threatened that might affect the granting, renewal, or extension of any Government Approval;
|
(c)
|
any dispute with, or notice of violation or penalty issued by, any Government Authority; or
|
(d)
|
any other material information regarding the Facilities.
|
(a)
|
The Operator shall provide Notice to Owner as soon as possible in the event of any equipment failure which will require an expenditure of greater than $10,000;
|
(b)
|
Operator will provide prompt Notice to Owner regarding any material deviations from the Approved Operating Plan;
|
(c)
|
With respect to any equipment procured by Operator on behalf of Owner, Operator shall deliver a copy of any relevant Manufacturer's Recommendations or other industry information to Owner as soon as reasonably practicable following receipt thereof by Operator;
|
(d)
|
Operator shall provide Notice as soon as possible of the violation of any Government Approval or Applicable Law in the operation and maintenance of the Facilities; and
|
(e)
|
Operator shall provide Owner with safety incident reports within three (3) Days of the occurrence of any safety incident except for any safety incident involving a significant non-scheduled event such as Natural Gas releases, fires, explosions, mechanical failures, unusual over-pressurizations or major injuries which shall be provided to Owner within eight (8) hours of the occurrence of such incident;
provided
,
however
, notification shall be provided to Owner immediately if the incident is of significant magnitude to threaten public or O&M Employee safety, cause significant property damage or interrupt the operation of the Facilities.
|
(a)
|
Not later than forty-five (45) days before the beginning of each Operating Year, Operator shall prepare and submit to Owner Operator's proposed Operating Plan for the Facilities for the following Operating Year. Each Operating Plan shall be prepared so as to comply and be consistent with Operator's obligations set out in Article III and shall only relate to the Services provided under this Agreement. Each Operating Plan shall show, in such detail reasonably required by Owner, and on a Month-by-Month basis, all relevant information relating to the anticipated
|
(b)
|
Operator acknowledges and agrees that no future Operating Plan shall require payment or reimbursement of, whether as Operating Expenses or otherwise, any costs and expenses (i) incurred by Operator or its Affiliates in or with respect to any Operating Year prior to the Operating Year to which the Operating Plan relates, (ii) except for equity or equity-based compensation to O&M Employees set forth in the Approved Budget, related to equity or equity-based compensation (including any compensation based on or otherwise related to Equity Securities (as defined in the Agreement of Limited Partnership of Cheniere Energy Partners, L.P., as may be amended from time to time), (iii) except for cash incentive compensation to O&M Employees set forth in the Approved Budget, related to cash incentive compensation, (iv) payable or otherwise related to any senior officer of Cheniere Energy, Inc., (v) related to or otherwise in connection with the Crest Royalty Agreement (as defined in the Agreement of Limited Partnership of Cheniere Energy Partners, L.P., as may be amended from time to time), (vi) allocating corporate overhead or administrative costs of or related to any member of the Operator Group (including costs associated with investor and public relations; accounting, finance and tax functions; human resources; business development efforts; sales and marketing; office space; third party professional, audit and legal expenses; travel and entertainment; telecommunications; computers and office equipment; insurance; and taxes),
(
vii) of compensation of personnel providing services pursuant to the Management Services Agreement, or (viii) which results in Cheniere Energy Partners, L.P. and its subsidiaries paying twice for the same service provided pursuant to this Agreement, and the Management Services Agreement or any other operation and maintenance agreement, any other management service or similar agreement or arrangement.
|
(a)
|
Operator shall, within a reasonable time after its receipt of such request, submit to Owner a revised Operating Plan (including a revised Budget and, if applicable, a revised Maintenance Program) incorporating the amendments requested by Owner, other than any such amendments which, in the reasonable and professional opinion of Operator, will prevent its ability to perform the Services in accordance with Article III. When submitting the revised Operating Plan to Owner, Operator shall identify any amendments requested by Owner which have not been incorporated into such amended Operating Plan, together with its reasons therefor.
|
(b)
|
Within a reasonable time after its receipt of any revised Operating Plan, Budget, or Maintenance Program, Owner shall either provide its written approval of the same or notify Operator of the amendments which it wishes to make together with its reasons therefor. If Owner requests amendments, Owner and Operator shall attempt to resolve all outstanding issues within thirty (30) Days after receipt by Operator of Owner's notification of amendments to the revised Operating Plan, Budget, or Maintenance Program.
|
(c)
|
If no agreement can be reached on the proposed Operating Plan, Budget, or Maintenance Program, or any item therein, within a reasonable time, the matters in dispute shall be referred to the senior management of Owner and Operator for resolution and the undisputed matters shall be deemed approved. If such Dispute is not resolved within fifteen (15) days of the date of such referral, the proposed Operating Plan, Budget and Maintenance Program as modified pursuant to the instructions and directions of Owner shall be adopted as the “Approved Operating Plan,” “Approved Budget,” and “Approved Maintenance Program” for the applicable Operating Year.
|
(d)
|
Upon approval by the Parties, or the adoption by Owner, of any Operating Plan, Budget, and Maintenance Program for the Facilities, Operator shall thereupon be obligated to carry out the work included in the Approved Operating Plan and Approved Maintenance Program in accordance with the timetable and other parameters included therein and in accordance with the financial parameters included in the corresponding Approved Budget; provided, that if Operator has notified Owner in writing of any Dispute regarding such Approved Operating Plan, Approved Maintenance Program or Approved Budget but Owner has adopted such plan, program or budget without resolving such Dispute, Operator's obligations hereunder with respect to performing such disputed matter shall be subject to the terms and conditions of Section 3.10.
|
(a)
|
the Billing Report for the Facilities for the preceding Month, as submitted by Operator pursuant to Section 9.6; and
|
(b)
|
any proposed adjustments in the relevant Approved Operating Plan, Approved Budget, or Approved Maintenance Program for the Facilities to reflect:
|
(i)
|
any changes in assumptions in the Approved Operating Plan, Approved Budget, or Approved Maintenance Program which might be desirable in the light of the performance of the Facilities;
|
(ii)
|
any other material change in circumstance or assumption in the Approved Operating Plan, Approved Budget, or Approved Maintenance Program; or
|
(iii)
|
any changes to the Services specified in the Approved Operating Plan, Approved Budget, or Approved Maintenance Program.
|
(a)
|
Identification of all projected costs of proposed projects, which may be capitalized in accordance with Owner policies;
|
(b)
|
Details of the number of employees and contract personnel required to construct and operate any proposed capital projects;
|
(c)
|
Such other information as the Owner may have reasonably required the Operator to provide.
|
(d)
|
Operator, in addition, will provide Owner a three-year project plan for capital projects to be used for planning purposes.
|
(a)
|
Upon knowledge by Operator that the actual costs of implementing any item in the Approved Capital Budget may exceed the overrun allowance, and before the overrun allowance is exceeded, Operator shall promptly notify Owner.
|
(i)
|
If Operator expects a project overrun, Operator will notify the Owner verbally prior to spending the additional money. Operator shall then provide Owner with the written information necessary to allow Owner to make a decision whether to proceed or cancel the implementation of the capital item.
|
(ii)
|
Upon receipt of the notification and information, Owner shall promptly decide whether to proceed or cancel the implementation of the capital item and notify Operator of its decision verbally, and later in writing.
|
(b)
|
Likewise, upon knowledge by Operator that the actual costs of implementing any item in the Approved Capital Budget may be less than the underrun allowance, Operator shall promptly notify Owner.
|
(a)
|
Labor Costs;
|
(b)
|
the cost of spares, tools, equipment, consumables, materials, chemicals, catalysts, and supplies (other than Natural Gas), including paint, procured in accordance with the provisions of this Agreement;
|
(c)
|
the cost of Operator's subcontract labor or services procured in accordance with the provisions of this Agreement;
|
(d)
|
capital expenditures and maintenance expenses incurred in accordance with the provisions of this Agreement;
|
(e)
|
permits and licenses necessary in the performance of Operator's duties in accordance with the provisions of this Agreement;
|
(f)
|
right-of-way oversight and maintenance, including any damages payments, lease rentals, recurring easement fees, and costs of realty rights if procured by Operator;
|
(g)
|
costs incurred for environmental assessments and inspections required by any Government Authority;
|
(h)
|
costs incurred for any plan which addresses pipeline integrity issues, including shallow cover and exposed pipe and low cathodic protection;
|
(i)
|
the cost of information technology;
|
(j)
|
the cost of any insurance premiums paid by Operator with respect to the insurance obtained and maintained by Operator pursuant to Section 14.1; provided that to the extent that Operator is liable under this Agreement for Losses covered by insurance, any deductible amount under any such insurance shall not be an Operating Expense;
|
(k)
|
the cost of office space, furnishings, equipment and supplies as well as the cost of copies, postage, telephone, and facsimile transmissions;
|
(l)
|
expenses of vehicles used in the performance of the Services in accordance with provisions of this Agreement;
|
(m)
|
the cost of transportation, travel, and relocation of O&M Employees;
|
(n)
|
all Taxes chargeable with respect to the operation and maintenance of the Facilities in accordance with Section 9.8;
|
(o)
|
the cost of recruiting and training O&M Employees; and
|
(p)
|
all other costs reasonably incurred in the performance of Operator's duties under this Agreement.
|
(a)
|
such expenditure is necessary to remedy an Emergency and is otherwise incurred in compliance with Article XVII; or
|
(b)
|
such type of expenditure is contemplated by an Approved Budget as it applies to a particular Month in an Operating Year, and such expenditure or expenditures with respect to the same activity:
|
(i)
|
is less than Ten Thousand Dollars ($10,000);
|
(ii)
|
does not result in Operator exceeding the applicable Monthly total for such Approved Budget by more than ten percent (10%); and
|
(iii)
|
in the reasonable judgment of Operator, will not result, and at year-end does not result in Operator exceeding the total amount of the Approved Budget for such Operating Year, as such Approved Budget may be adjusted from time-to-time during such Operating Year pursuant to Section 7.6.
|
(a)
|
provide prompt Notice to the other Party of the occurrence of the Force Majeure Event, which Notice shall provide details with respect to the circumstances constituting the Force Majeure Event, an estimate of its expected duration, and the probable impact on the affected Party's performance of its obligations hereunder;
|
(b)
|
use all reasonable efforts to continue to perform its obligations hereunder;
|
(c)
|
take all reasonable action to correct or cure the event or condition constituting the Force Majeure Event;
|
(d)
|
use all reasonable efforts to mitigate or limit the adverse effects of the Force Majeure Event and damages to the other Party, to the extent such action would not adversely affect its own interests; and
|
(e)
|
provide prompt Notice to the other Party of the cessation of the Force Majeure Event.
|
(a)
|
the bankruptcy, insolvency, dissolution, or cessation of the business of Operator;
|
(b)
|
Operator fails to obtain and maintain insurance required to be obtained and maintained by it under this Agreement which failure continues for thirty (30) Days after Operator's receipt of Notice of such failure from Owner;
|
(c)
|
Operator assigns its rights under this Agreement except as permitted hereunder;
|
(d)
|
Operator ceases to provide all Services required to be performed by it hereunder for ten (10) consecutive days except as required or permitted hereunder; or
|
(e)
|
a material failure by Operator to perform its obligations hereunder which continues for thirty (30) Days after Operator's receipt of Notice of such failure from Owner which Notice shall include Owner's recommendation for a cure of such failure, unless Operator commences to cure such failure within said thirty (30) Days and cures such failure within seventy-five (75) Days after its receipt of the aforesaid Notice.
|
(a)
|
the bankruptcy, insolvency, dissolution, or cessation of the business of Owner;
|
(b)
|
a material failure by Owner to perform its obligations hereunder which continues for thirty (30) Days after Owner's receipt of Notice of such failure, unless Owner commences to cure such failure within said thirty (30) Days and either cures or continues to diligently attempt the cure of such failure; or
|
(c)
|
a default by Owner in its payment obligations to Operator, unless Owner has cured such breach within thirty (30) days from receipt of Notice from Operator.
|
(a)
|
Operator shall use all reasonable efforts to facilitate the appointment and commencement of duties of any Person to be appointed by Owner to provide administrative and advisory services in connection with the operation and maintenance of the Facilities (the “Successor Operator”) so as not to disrupt the normal operation and maintenance of the Facilities and shall provide full access to the Facilities and to all relevant information, data, and records relating thereto to the Successor Operator and its representatives, and accede to all reasonable requests made by such Persons in connection with preparing for taking over the operation and maintenance of the Facilities.
|
(b)
|
Promptly after termination, Operator shall deliver to (and shall, with effect from termination, hold in trust for and to the order of) Owner or to the Successor Operator all property in its possession or under its control owned by Owner or leased or licensed to Owner. All spares, supplies, consumables, special tools, operating logs, books, records, operation and maintenance manuals, and any other items furnished as part of the Services hereunder or at direct cost to Owner shall be left at the Facilities.
|
(c)
|
Operator, to the extent allowed by such agreements and approvals, shall transfer to the Successor Operator, as from the date of termination, its rights as Operator under all contracts entered into by it, and all Government Approvals obtained and maintained by it, in the performance of its obligations under this Agreement
|
(d)
|
Upon Notice from Owner to Operator on or prior to the Termination Date, for a period of up to ninety (90) days following the Termination Date, Operator shall provide the services of its O&M Employees as may be required or reasonably requested by Owner to enable Owner to operate and maintain Facilities and train any Successor Operator. The Notice invoking this provision may be included in the Termination Notice provided in Section 11.4, and shall provide Owner's good faith estimate of how many days Operator's services will be required post-Termination Date, up to the ninety (90) days specified herein. Subject to any limitations set forth herein, Operator's Operating Expenses, as set forth in the then-current Approved Budget or as otherwise reasonably incurred and agreed by the Parties in connection with the transition, shall be paid by Owner.
|
(i)
|
At Operator's election, (x) be underwritten by insurers which are rated “A- VIII” or higher by the most current edition of Best's Key Rating Guide and which are authorized to write insurance in the state or states in which the Services are to be performed, or (y) be underwritten by insurers which are financially secure and are acceptable to Owner; and
|
(ii)
|
Be endorsed to specifically name Owner and its Affiliates as additional insured, excluding, however, Workers' Compensation. Operator will exercise all reasonable efforts to cause the Contractor and to require that the Contractor cause its subcontractors to obtain from their insurers an agreement to waive their subrogation rights against Owner and Operator.
|
(a)
|
any matter which is already generally available and in the public domain other than through unauthorized disclosure by Operator or is otherwise known to Operator from a source that is not in violation of a confidentiality obligation to Owner;
|
(b)
|
any disclosure which may reasonably be required for the performance of Operator's obligations under this Agreement; or
|
(c)
|
any disclosure which may be required for the compliance by Operator with Applicable Laws or for the purposes of legal proceedings, if Operator has notified Owner prior to any such disclosure.
|
(a)
|
to limit access to Confidential Information to O&M Employees, Subcontractors, Operator's officers, directors, attorneys, agents, employees, Affiliates or other representatives who reasonably require the Confidential Information to ensure the satisfactory performance of the Services;
|
(b)
|
to inform each of its Subcontractors, officers, directors, attorneys, agents, employees and other representatives to whom Confidential Information is disclosed of the restrictions on disclosure of such information as set forth herein and to use reasonable efforts to ensure that all such Persons comply with such instructions; and
|
(c)
|
upon receipt of a written request from Owner and, in any event, upon completion of the Services or earlier termination of this Agreement to return to Owner all documents, papers, computer programs, software or records containing Confidential Information, if so requested by Owner.
|
To Owner:
|
Cheniere Creole Trail Pipeline, L.P.
700 Milam Street, Suite 800
Houston, Texas 77002
Attention: President
Facsimile Number: 713.375.6000
|
|
To Operator:
|
Cheniere Energy Partners GP, LLC
700 Milam Street, Suite 800
Houston, Texas 77002
Attention: Senior Vice President
Facsimile Number: 713.375.6000
|
|
To O&M Services:
|
Cheniere LNG O&M Services, LLC
700 Milam Street, Suite 800
Houston, Texas 77002
Attention: Senior Vice President
Facsimile Number: 713.375.6000
|
(a)
|
if personally delivered to a Person's address, on the day of delivery;
|
(b)
|
if sent by courier or prepaid mail, on the day of delivery; and
|
(c)
|
if transmitted by facsimile to a Person's facsimile number, and a correct and complete transmission report is received by the sender, on the day of transmission.
|
(a)
|
it is duly organized and validly existing under the laws of its jurisdiction of its organization and has all requisite partnership or limited liability company, as the case may be, power and authority to own its property and assets and conduct its business as presently conducted or proposed to be conducted under this Agreement;
|
(b)
|
it has the partnership or limited liability company power and authority, as the case may be, to execute and deliver this Agreement, to consummate the transactions contemplated hereby and to perform its obligations hereunder;
|
(c)
|
it has taken all necessary action to authorize its execution, delivery and performance of this Agreement, and this Agreement constitutes the valid, legal and binding obligation of such Party enforceable against it in accordance with its terms except as such enforcement may be limited by bankruptcy, insolvency, moratorium or similar laws affecting the rights of creditors or by general equitable principles (whether considered in a proceeding in equity or at law);
|
(d)
|
no Government Approval is required for (i) the valid execution and delivery of this Agreement or (ii) the performance by such Party of its obligations under this Agreement, except such as (A) have been duly obtained or made or (B) can reasonably be expected to be obtained or made when needed;
|
(e)
|
none of the execution or delivery of this Agreement, the performance by such Party of its obligations in connection with the transactions contemplated hereby, or the fulfillment of the terms and conditions hereof: (i) conflict with or violate any provision of its organizational documents, (ii) conflict with, violate or result in a breach of, any Applicable Law currently in effect, or (iii) conflict with, violate or result in a breach of, or constitute a default under or result in the imposition or creation of, any security under any agreement or instrument to which it is a Party or by which it or any of its properties or assets are bound;
|
(f)
|
no meeting has been convened for its dissolution or winding-up, no such step is intended by it and, so far as it is aware, no petition, application or the like is outstanding or threatened for its dissolution or winding-up; and
|
(g)
|
it is not a party to any legal, administrative, arbitral or other proceeding, investigation or controversy pending, or, to the best knowledge of such Party, threatened, that would materially adversely affect such Party's ability to perform its obligations under this Agreement.
|
Name:
|
R. Keith Teague
|
a)
|
Routine Operations
. Operator will conduct all routine field operations with respect to the Facilities, and shall procure and furnish all materials, equipment, services, supplies and labor necessary for the safe, routine and prudent operation, maintenance, routine non-major construction of the Facilities, routine engineering in support of these activities, and related warehousing and security, including, without limitation, the following:
|
i)
|
Maintain and operate all measurement, including RTU, EFM, and communications, equipment, where such activity is the obligation of Owner, in accordance with Owner's and industry standards.
|
ii)
|
Maintain and oversee pipeline rights-of-way including aerial patrol, markings and signage; and manage landowner and other third party encroachments to preserve Owner's easement rights and prevent interference with Owner's and Operator's ability to operate and maintain the Facilities.
|
iii)
|
In conjunction with Owner's IT personnel, maintain Owner provided GIS system including configuring all Owner provided data, system hardware, servers, communications equipment and licenses.
|
iv)
|
Maintain integrity systems including performance of pipeline coating maintenance and maintenance and operation of cathodic protection systems.
|
v)
|
Perform periodic testing, calibration, adjustment and external and internal inspection so as to keep the Facilities in good working order.
|
vi)
|
Perform routine equipment maintenance, repair, reconditioning, overhaul and replacement so as to keep the Facilities in good working order and demonstrate good housekeeping measures to maintain the Facilities.
|
vii)
|
Select and engage third party personnel as required to perform and oversee the operation, maintenance, repairs, and replacements of the Facilities.
|
viii)
|
Keep in force and effect, in the name of Owner, all permits and maintain records thereof as required by FERC Authorization and all Applicable Laws.
|
ix)
|
Maintain, on behalf of Owner, the Owner's title to the rights-of-way, associated records and files relating to same, including acquisition of rights of way for routine pipeline construction and enhancement projects and for ground beds for cathodic protection, right of way damages payments, and lease renewal fees.
|
x)
|
In conjunction with Owner's Corporate EH&S, or any Contractor performing such services for Owner, create and maintain information systems with respect to permits, regulatory filings and rights-of-way so that matters such as renewals, expenditures, terminations, limitations on assignments and notification requirements can be tracked, maintained and complied with in accordance with applicable terms.
|
xi)
|
Enforce the Owner's FERC Gas Tariff gas quality specifications in effect from time to time as to gas transported in the Facilities.
|
xii)
|
Conduct all other routine Day-to-Day field operations of the Facilities.
|
xiii)
|
Order and purchase required material, supplies, and equipment of the types used in the ordinary course of operation of the Facilities as set out in the Approved Budget, including pipe for pipe replacements, routine meter betterments, and cathodic protection equipment, which are in conformance with the established Owner standards for materials.
|
xiv)
|
Operate and maintain, or if subcontracted to a third party, oversee the operation and maintenance of Owner's gas measurement points, including all measurement points leaving and or entering the Facilities, in accordance with all applicable standards, interconnect agreements and Owner's policies and procedures, including the Owner's FERC Gas Tariff.
|
xv)
|
Direct any requests for new gas connections or requests for new transportations services to Owner. Similarly, Operator shall not make any pipeline modifications not authorized by Owner.
|
xvi)
|
Develop and implement procedures for emergency and security response. These procedures will describe the measures that are necessary to protect employees, Owner property, and operations from man-made or emergency disruptions. Owner will approve all response measures developed by Operator. Operator will enact such procedures at, Operators discretion, in accordance with said procedures.
|
xvii)
|
At Owner's direction and with Owner's approval, develop and implement routine and recurring provisions for a pipeline integrity management plan.
|
xviii)
|
At Owner's direction and with Owner's approval, Operator will develop and implement routine and recurring provisions an internal corrosion mitigation plan.
|
b)
|
Gas Control Operations
. Operator will provide the following to perform Gas Control services to Owner.
|
i)
|
Operator personnel providing Gas Control services will be fully qualified based on procedures developed by Operator and approved by Owner.
|
ii)
|
Operator will locate the Gas Control Operations at the SPLNG control room at Sabine Pass.
|
(a)
|
Any permanent change in location will require sixty (60) Day advance Notice to Owner. Likewise, any change in temporary location due to communication outages, disaster recovery, or other events does not require advance Notice to Owner. Owner should be notified of the reason and expected duration of such events within one (1) hour of such occurrence.
|
(b)
|
Operator may change personnel performing Gas Control services at any time. Any change to personnel should be noticed to Owner within one (1) day of such change and revised contact information pursuant with Article XIX.
|
iii)
|
Owner will provide SCADA system for use by Operator's Gas Control personnel. All system hardware, communications equipment and licenses will be the responsibility of the Owner.
|
(a)
|
EFM, RTU and other devices will be provided, directly or indirectly, by Owner.
|
(b)
|
Maintenance of all equipment necessary to provide SCADA services to Gas Control will be provided by Owner's IT personnel and Operator.
|
iv)
|
Gas Control functions performed by Operator's personnel include the following;
|
(a)
|
Ensuring that gas volumes and pressures meet customer, operational and safety demands while maintaining detailed and accurate records of daily Gas Control operations.
|
(b)
|
Monitoring the SCADA system to analyze gas control data, respond to all SCADA alarms and ensure that pressures stay within Maximum Allowable Operating Pressures (MAOP).
|
(c)
|
Supporting daily commercial operating plans by making necessary adjustments to pressures, flow quantities, gas heating and line pack.
|
(d)
|
Ensuring efficient use of heaters, regulators, gas measurement and related equipment to minimize fuel consumed and gas loss (LUAF).
|
(e)
|
Coordinating with downstream pipeline operators to confirm requests for Natural Gas flow, changes in conditions and general operating information.
|
v)
|
Operator agrees that Gas Control operating personnel will strictly conform to Owner's FERC Standards of Conduct, which may be amended from time to time, regarding marketing affiliate relations and including the 'no-conduit' obligation. The Owner's FERC Standards of Conduct are included herein in Schedule 4 and made a part of hereof.
|
vi)
|
Coordination of certain Day-to-Day planning activities to achieve the Gas Control requirements between Owner and Operator will be in accordance to the responsibility matrix provided below in Schedule 1 (e).
|
c)
|
Marketing Operations
. Operator will provide Marketing Operations services to Owner utilizing shared employees with Operator's Customer Services personnel or others as determined by Operator.
|
i)
|
Operator personnel providing Marketing Operations functions will comply fully with the Owner's FERC Standards of Conduct included herein in Schedule 4 and made a part of hereof.
|
ii)
|
All questions regarding availability of pipeline services, rates for services, availability of services, future plans or similar matters will be forwarded to Owner for response by Owner.
|
iii)
|
Operator will conduct the following Marketing Operations tasks with respect to the Facilities:
|
(a)
|
Manage the Day-to-Day nominations, confirmations and scheduling processes with up and downstream operators and customers utilizing the Owner's Gas Transaction Management system.
|
(i)
|
Provide results of these processes, either via reports, screens or emails, to Owner.
|
(ii)
|
Provide results of these processes, either via reports, screens or emails, to Gas Control.
|
(b)
|
Manage Owner's automated and notice Informational Posting process.
|
(c)
|
Manage the Allocations process utilizing the Owner's Gas Transaction system.
|
(i)
|
All material prior period adjustments will be reviewed and approved in advance by Owner and such approval will not reasonably be withheld.
|
(d)
|
Make Gas Transaction Management System changes to locations or other physical parameters, including capacity, as required or directed by Owner.
|
(e)
|
Generate contracts, amendments or capacity releases as necessary or at the request of Owner.
|
(f)
|
Generate and send monthly invoices to shippers.
|
(i)
|
Monthly invoices will be reviewed and approved by Owner.
|
(ii)
|
Changes to any billable rate must be approved by Owner.
|
(iii)
|
Access to rate screens within the Owner's Gas Transaction Management system will be governed by security roles approved by Owner.
|
(g)
|
Other activities that may be required from time to time by Owner.
|
iv)
|
Any discretion requiring a tariff waiver will be approved in advance by Owner. Such waiver will be posted to Owner's internet website in accordance with section c (iii) (2) above.
|
v)
|
Owner will provide the Gas Transaction Management and Informational Posting systems including software and hardware but excluding desktops and laptops used by Operator. Maintenance of these systems will be provided by Operator.
|
(a)
|
Any change request by Operator with regard to Owner's systems should be approved by Owner.
|
(b)
|
Owner reserves the unilateral right to change Gas Transaction Systems, names, logos, internet addresses or other identifying items.
|
vi)
|
Coordination of day-to-day Marketing Operations requirements between Owner and Operator will be in accordance to the responsibility matrix provided below in Schedule 1 (e).
|
d)
|
Measurement Services
. Operator will provide measurement accounting services to Owner. Measurement accounting services will include monitoring third party data.
|
i)
|
Owner will provide a measurement accounting system including software and hardware but excluding desktops and laptops used by Operator.
|
(a)
|
EFM, RTU and other devices will be provided, directly or indirectly, by Owner.
|
(b)
|
Maintenance of all equipment necessary to provide measurement accounting services will be provided by Owner's IT personnel and Operator.
|
ii)
|
To the extent that Owner and Operator have a shared commercial interest in a facility, the Parties agree to take reasonable efforts to agree to and approve measurement information.
|
(a)
|
The responsible measurement Party will be defined in the Interconnect Agreement executed between Owner and third Parties.
|
(b)
|
For other, non-physical locations, including LUAF, line pack, OBA or other inventory points, the Owner will have the right to approve data of monthly close. Such approval will not be unreasonably withheld.
|
iii)
|
Notwithstanding subsection (ii) above, Owner will have measurement accounting system security access to review, approve, modify and close measured or estimated quantities.
|
iv)
|
Coordination of day-to-day Gas Control requirements between Owner and Operator will be in accordance to the responsibility matrix provided below in Schedule 1 (e).
|
e)
|
Responsibility Matrix
. The following matrix describes the normal day-to-day coordination of Gas Control, Marketing Operations and Measurement activities between Owner and Operator. Changes to these activities must be approved by Both Parties. Such approval will not be unreasonably withheld.
|
O&M Pipeline Services
|
|||||||
|
P
|
Primary Responsibility
|
|||||
V
|
Verification & Approval
|
||||||
BP
|
Backup Primary (sick, vacation, on-call)
|
||||||
BV
|
Backup Verification (sick, vacation)
|
||||||
Activities
|
Responsibilities
|
||||||
|
Owner
|
Operator
|
|||||
Marketing Operations
|
|
|
|
|
|
|
|
Nominations, Confirmation & Scheduling
|
V
|
BV
|
P
|
BP
|
|
|
|
Liaison among customers, terminal, 3rd party, pipes & storage operators
|
V
|
BV
|
P
|
BP
|
|
|
|
Manage functions after hours
|
V
|
BV
|
P
|
BP
|
|
|
|
Measurement Allocation
|
V
|
BV
|
P
|
BP
|
|
|
|
Transaction management system maintenance
|
V
|
BV
|
P
|
BP
|
|
|
|
Review and post pipeline capacity, gas quality, and maintenance
|
V
|
BV
|
P
|
BP
|
|
|
|
Prepare and validate daily transaction and measurement activities
|
V
|
BV
|
P
|
BP
|
|
|
|
Monthly reconciliation & closing activities
|
V
|
BV
|
P
|
P
|
|
|
P
|
Billing support documentation
|
V
|
BV
|
P
|
P
|
|
|
P
|
Gas Control Planning
|
|
|
|
|
|
|
|
Plan pipeline operations and communicate with gas control
|
V
|
BV
|
|
|
BP
|
P
|
|
Track operations and coordinate with gas control
|
V
|
BV
|
|
|
BP
|
P
|
|
Maintain pipeline balance and LUAF
|
V
|
BV
|
|
|
BP
|
P
|
|
Gas Measurement
|
|
|
|
|
|
|
|
Verify EFM data collection & resolve data collection issues
|
|
|
|
BP
|
BV
|
V/BP
|
P
|
Analyse EFM data exceptions & edit measurement data
|
|
V
|
|
BP
|
BP/BV
|
P
|
P
|
Loan meter test & unmeasured gas and edit historical data as necessary
|
|
V
|
|
BP
|
BV
|
P
|
P
|
Maintain OBA between SPLNG & CTPL
|
V
|
BP/BV
|
P
|
|
|
|
|
PPA Approval
|
P
|
V
|
BP/BV
|
|
|
|
|
Discuss significant PPAs with customers
|
P
|
V
|
P
|
|
B
|
P
|
|
Maintain and evaluate physical gas balances
|
V
|
BV
|
|
|
BP
|
P
|
P
|
Measurement close
|
V
|
|
BV
|
|
BP
|
P
|
P
|
a.
|
Planned routine operational services.
|
b.
|
Planned routine maintenance and repair for each part of the Facilities.
|
c.
|
Information regarding the inventory and proposed procurement of equipment, spares, tools and in the case of major equipment, the residual life, routine operational information, general operating data and other project data.
|
d.
|
Scheduled outages for major equipment.
|
e.
|
Staffing plans of Operator (indicating any changes in the level of staff or in the management personnel at the Facilities) and details of the numbers of part-time and temporary staff, consultants, operating staff and maintenance staff.
|
f.
|
Planned training program.
|
g.
|
Contract strategy and a description of material subcontracts proposed to be entered into and material subcontracts then in effect.
|
h.
|
Planned administrative activities and the status of relationships with parties to the local community and all Government Authorities having jurisdiction over the operation and maintenance of the Facilities or Operator.
|
i.
|
Operators recommendations on any matters affecting the operation and maintenance of the Facilities (such as modifications, capital improvements or capital expenditure or changes in the O&M Procedures Manual or Standing Procedures) together with reasons therefore.
|
j.
|
A description of any (i) change in Applicable Laws or (ii) proposed change in Applicable Laws of which Operator has knowledge, which in either case may affect the operation or maintenance of any part of the Facilities, together with a breakdown of any incremental costs associated therewith.
|
k.
|
Operator's environmental plan describing the actions necessary to ensure that the Facilities complies with all Government Approvals and all Applicable Laws, and
|
l.
|
Such other works and activities as are necessary for Operator to comply with its obligations under this Agreement.
|
Payroll (office personnel) Benefits
|
|
Employee Expenses:
|
|
|
Training
|
|
Meals & Entertainment
|
|
Travel & Lodging
|
|
Mileage
|
Vehicle Expense
|
|
Outside Professional Services Insurance
|
|
Other
|
Payroll (field operations personnel)
|
|
Benefits
|
|
Employee Expenses
|
|
|
Training
|
|
Meals & Entertainment
|
|
Travel & Lodging
|
|
Mileage
|
Vehicle Expense
|
|
Outside Professional Services
|
|
Repairs & Maintenance
|
|
Occupancy - Office Rent
|
|
Occupancy - Utilities
|
|
Telecommunications
|
|
Leases - Other
|
|
Utilities - Field
|
|
Small Tools/Equipment
|
|
Consumables
|
|
Chemicals/Lubricants
|
|
Other
|
a.
|
Develop organization and staffing proposals for the Facilities together with a human resources policy to include a profile of suitable recruits, training requirements, compensation package, terms of employment (including, if agreed between the Parties as appropriate, an employee incentive scheme), mobilization requirements, industrial relations policy, union policy (if applicable) and job design;
|
b.
|
Prepare a set of safety procedures for working on all electrical, mechanical and chemical items located at the Facilities;
|
c.
|
Prepare a system and procedure for the control of material modifications to the Facilities;
|
d.
|
Prepare and maintain a confidential security plan regarding Facilities security including interface with Government Authorities;
|
e.
|
Prepare the O&M Procedures Manual which will contain the following specific manual instructions and procedures or the Facilities:
|
i.
|
Operations and Maintenance Procedures;
|
ii.
|
Pipeline Standard Operating Procedures;
|
iii.
|
Public Awareness Program;
|
iv.
|
Pipeline Integrity Management Program;
|
v.
|
Operator Qualification Plan;
|
vi.
|
Corrosion Control Procedures;
|
vii.
|
Measurement Standard Operating Procedures;
|
viii.
|
Pipeline Critical Site Security Plans;
|
ix.
|
Pipeline Operations Security Plan;
|
x.
|
Planned maintenance schedules;
|
xi.
|
Compliance Record Filing Plan
|
xii.
|
Emergency Response Plans;
|
xiii.
|
Damage Prevention Program;
|
xiv.
|
Welding Procedures;
|
xv.
|
Non-Destructive Testing Procedures;
|
xvi.
|
Pipeline Repair Manual;
|
f.
|
prepare a work control system;
|
g.
|
prepare a budget and expenditure control system;
|
h.
|
prepare a stores and spares inventory recording and requisitions system; and
|
i.
|
prepare a procedure for the procurement of all supplies and services required by Operator to perform its obligations hereunder, including subcontractor control and supervision system and prepare a system for the review and updating of O&M Procedures Manual for the Facilities.
|
j.
|
prepare regulatory compliance and safe work practices procedures, including:
|
•
|
Access Control Plan and Procedures
|
•
|
[Homeland Security Compliance Procedures]
|
•
|
Valve Isolation Policy
|
•
|
Emergency Response Plan and Procedures
|
•
|
Facilities Safety Plan and Procedures
|
•
|
Safe Services Practices
|
•
|
DOT 199 Substance Abuse Prevention Program
|
•
|
Training and Operator Qualification Plan in accordance with DOT regulations set forth in 49 CFR Subpart N of Section 192.
|
k.
|
Prepare General Operations Plans and Procedures, including:
|
•
|
IT Plan and Procedures
|
•
|
Budget Planning and Procedures
|
•
|
Facilities Integration and Shared Services Plan
|
•
|
Security Plan and Procedures
|
•
|
Management Control and Reporting; Daily, Weekly, Monthly, Annual KPI's and Reports
|
•
|
Meeting Schedules and Agenda
|
•
|
Risk Management Plan and Risk Register
|
•
|
Contract Management Plan
|
•
|
Local Contracts Requirements for Materials and Services
|
•
|
Long Term Service Agreements
|
•
|
Maintenance Contracting Strategies and Selection
|
•
|
Radios, Telephones, Pagers, Satellite, Cellular Phone Plan
|
•
|
Measurement Manual
|
•
|
Vehicle policies and procedures
|
•
|
Management of Change Procedures
|
•
|
Medical Emergency Response Plan and Procedures
|
•
|
Waste Management, Collection and Disposal Plan
|
•
|
Equipment and Vehicles Purchase, Receipt
|
•
|
Owner Equipment Handling Study
|
•
|
Operability Assurance Plan
|
•
|
Startup and Commissioning Plan
|
l.
|
Prepare Recruitment and Staffing Plans including:
|
•
|
Manpower Plan Forecast
|
•
|
Job Positions and Titles
|
•
|
Recruitment Timeline
|
•
|
Competencies by Position Families
|
•
|
Position Descriptions
|
•
|
Detailed Training Matrix
|
•
|
Specialized Training
|
•
|
Local Content Plan
|
•
|
Recruitment and Interviewing of candidates
|
•
|
HR policies and procedures
|
•
|
Training and Operator Qualification Plan
|
•
|
Training Schedules, Logistics and Activities
|
•
|
Training Evaluation and Employee Assessment
|
m.
|
Prepare Readiness Plan, including:
|
•
|
Procurement Plans and Procedures
|
•
|
Material Management Plan
|
•
|
Warehouse and Inventory Plan
|
•
|
2 Year Operating and Capital Spare Review
|
•
|
Capital Spares Purchase, Receipt, Stocking
|
•
|
Shelving Plan, Design, Purchase, Receipt, Installation
|
•
|
Set Up Warehouse
|
•
|
Set Up Laboratory
|
•
|
Set Up Main Control Room
|
•
|
Set Up Maintenance Shops
|
1)
|
Interconnect Agreement dated as of March 29, 2007 between Cheniere Creole Trail Pipeline. L.P. and Bridgeline Holdings, L.P.
|
2)
|
Interconnect Agreement dated as of February 14, 2007 between Cheniere Creole Trail Pipeline. L.P. and Natural Gas Pipeline Company of America LLC.
|
3)
|
Interconnect Agreement dated as of July 31, 2007 between Cheniere Creole Trail Pipeline. L.P. and Texas Eastern Transmission, LP.
|
4)
|
Amended and Restated Interconnect Agreement dated as of September 4, 2012 between Cheniere Creole Trail Pipeline. L.P. and Trunkline Gas Company, LLC.
|
5)
|
Interconnect Agreement dated as of September 1, 2007 between Cheniere Creole Trail Pipeline. L.P. and Transcontinental Gas Pipeline Corporation (Southwest Lateral).
|
6)
|
Interconnect Agreement dated as of September 1, 2007 between Cheniere Creole Trail Pipeline. L.P. and Transcontinental Gas Pipeline Corporation (Mainline).
|
7)
|
Interconnect Agreement dated as of February 7, 2008 between Cheniere Creole Trail Pipeline. L.P. and Sabine Pass LNG, L.P.
|
1)
|
Operational Balancing Agreement dated April 1, 2008 between Transcontinental Gas Pipe Line Corporation and Cheniere Creole Trail Pipeline, L.P. for Mainline Location.
|
2)
|
Operational Balancing Agreement dated April 1, 2008 between Transcontinental Gas Pipe Line Corporation and Cheniere Creole Trail Pipeline, L.P. for Southwest Lateral Location.
|
3)
|
Operational Balancing Agreement dated April 1, 2008 between Natural Gas Pipeline Company of America LLC and Cheniere Creole Trail Pipeline, L.P.
|
4)
|
Operational Balancing Agreement dated February 19, 2008 between Bridgeline Holdings, L.P. and Cheniere Creole Trail Pipeline, L.P.
|
5)
|
Operational Balancing Agreement dated June 16, 2008 between Texas Eastern Transmission, LP and Cheniere Creole Trail Pipeline, L.P.
|
6)
|
Operational Balancing Agreement dated June 1, 2008 between Trunkline Gas Company, LLC and Cheniere Creole Trail Pipeline, L.P.
|
7)
|
Operational Balancing Agreement dated February 7, 2008 between Sabine Pass LNG, L.P. and Cheniere Creole Trail Pipeline, L.P.
|
8)
|
Master Software License Agreement dated as of August 3, 2006 between Cheniere Pipeline Company and Quorum Business Solutions (U.S.A.), Inc.
|
9)
|
License Agreement (WinFlow Program Package) dated as of November 29, 2006 between Cheniere Energy, Inc. and Gregg Engineering Services, Ltd., as amended by Addendum effective August 31, 2007.
|
10)
|
License Agreement dated as of August 25, 2010 between Cheniere Energy, Inc. and Environmental Systems Research Institute, Inc.
|
11)
|
License and Service Level Agreement dated as of August 24, 2010 between Cheniere Energy, Inc. and Pictometry International Corp.
|
12)
|
End Customer License Agreement dated as of March 19, 2013 between Cheniere Energy, Inc. and SynerGIS Informationssysteme GmBH.
|
13)
|
Automation Solutions, Inc.
|
14)
|
Control Microsystems, Inc.
|
15)
|
Eagle Information Mapping, Inc.
|
16)
|
GIS Technology, Inc.
|
17)
|
American Innovations, Ltd.
|
18)
|
CartoPac Field Solutions
|
1)
|
Master Services Agreement dated as of January 5, 2012 between Cheniere Creole Trail Pipeline, L.P. and A. J. Aviation, Inc.
|
2)
|
Master Service Agreement dated as of January 5, 2012 between Cheniere Creole Trail Pipeline, L.P. and Buffalo Gap Instrumentation & Electrical Co., Inc.
|
3)
|
Master Service Agreement dated as of January 5, 2012 between Cheniere Creole Trail Pipeline, L.P. and Corrpro Companies, Inc.
|
4)
|
Master Service Agreement dated as of February 1, 2012 between Cheniere Creole Trail Pipeline, L.P. and Eagle Information Mapping, Inc.
|
5)
|
Master Service Agreement dated as of March 28, 2012 between Cheniere Creole Trail Pipeline, L.P. and Furmanite America, Inc.
|
6)
|
Master Service Agreement dated as of March 19, 2012 between Cheniere Creole Trail Pipeline, L.P. and Liberty Pipeline Services, LLC
|
7)
|
Master Service Agreement dated as of January 5, 2012 between Cheniere Creole Trail Pipeline, L.P. and M. J. Harden Associates, Inc.
|
8)
|
Master Service Agreement dated as of January 12, 2012 between Cheniere Creole Trail Pipeline, L.P. and Project Consulting Services, Inc.
|
9)
|
Master Service Agreement dated as of January 3, 2012 between Cheniere Creole Trail Pipeline, L.P. and Providence Engineering & Environmental Group LLC
|
10)
|
Master Service Agreement dated as of March 13, 2012 between Cheniere Creole Trail Pipeline, L.P. and Roy Bailey Construction, Inc.
|
11)
|
Master Service Agreement dated as of January 12, 2012 between Cheniere Creole Trail Pipeline, L.P. and TRC Environmental Corporation
|
12)
|
Master Service Agreement dated as of January 16, 2012 between Cheniere Creole Trail Pipeline, L.P. and U.S. Valve Services & Training, Inc.
|
13)
|
Master Service Agreement dated as of January 9, 2012 between Cheniere Creole Trail Pipeline, L.P. and Vegetation Management Specialists, Inc.
|
14)
|
Master Service Agreement dated as of January 16, 2012 between Cheniere Creole Trail Pipeline, L.P. and Veriforce, LLC
|
15)
|
Master Service Agreement dated as of April 30, 2012 between Cheniere Creole Trail Pipeline, L.P. and Davies Construction, Inc.
|
16)
|
Master Service Agreement dated as of June 1, 2012 between Cheniere Creole Trail Pipeline Company, L.P. and Willbros Engineers (U.S.), LLC
|
17)
|
Master Service Agreement dated as of January 1, 2013 between Cheniere Creole Trail Pipeline Company, L.P. and Armor Plate, Inc.
|
18)
|
Master Service Agreement dated as of January 1, 2013 between Cheniere Creole Trail Pipeline Company, L.P. and Crain Brothers, Inc.
|
19)
|
Master Service Agreement dated as of January 21, 2013 between Cheniere Creole Trail Pipeline Company, L.P. and Global X-Ray & Testing, Corp.
|
20)
|
Master Service Agreement dated as of January 1, 2013 between Cheniere Creole Trail Pipeline Company, L.P. and Hatch Mott MacDonald, LLC.
|
21)
|
Master Service Agreement dated as of February 27, 2013 between Cheniere Creole Trail Pipeline, L.P. and Kidd Combustion Equipment Company, Inc.
|
22)
|
Engineering Agreement to Reconfigure Existing Interconnection Beauregard Parish, Louisiana - Transco Mainline dated as of February 29, 2012 between Cheniere Creole Trail Pipeline. L.P. and Transcontinental Gas Pipe Line Company, LLC
|
23)
|
Master Service Agreement dated as of January 1, 2013 between Cheniere Creole Trail Pipeline, L.P. and Reserve Equipment, Inc.
|
24)
|
Master Service Agreement dated as of April 5, 2013 between Cheniere Creole Trail Pipeline, L.P. and Sunland Construction, Inc.
|
25)
|
Master Service Agreement dated as of January 27, 2013 between Cheniere Creole Trail Pipeline, L.P. and Strike Construction, LLC
|
26)
|
Master Service Agreement dated as of February 27, 2013 between Creole Trail Pipeline, L.P. and WHC, Inc.
|
27)
|
Master Service Agreement dated as of August 20, 2012 between Cheniere Creole Trail Pipeline, L.P. and Badger Daylighting Corporation
|
28)
|
Master Service Agreement dated as of September 14, 2012 between Cheniere Creole Trail Pipeline, L.P. and Cameron International Corporation
|
29)
|
Master Service Agreement dated as of April 17, 2013 between Cheniere Creole Trail Pipeline, L.P. and Daniel Measurement Services, Inc.
|
30)
|
Master Service Agreement dated as of November 15, 2012 between Cheniere Creole Trail Pipeline, L.P. and Houston Inspection Field Services, LLC
|
31)
|
Master Service Agreement dated as of March 25, 2013 between Cheniere Creole Trail Pipeline, L.P. and R.W. Tools and Supply Company
|
32)
|
Master Service Agreement dated as of April 10, 2013 between Cheniere Creole Trail Pipeline, L.P. and Survey and Mapping, Inc.
|
1)
|
Master Service Agreement dated as of October 6, 2011 between Cheniere Pipeline Company and Alliance Wood Group Engineering, L.P.
|
2)
|
Master Service Agreement dated as of July 6, 2010 between Cheniere Pipeline Company and Central Testing Company, Inc.
|
3)
|
Right of Way Services Agreement dated January 21, 2010 between Cheniere Pipeline Company and Contract Land Staff, LLC
|
4)
|
Master Service Agreement dated as of May 11, 2010 between Cheniere Pipeline Company and Driver Pipeline Company
|
5)
|
Environmental Spill Response and Clean Up Master Service Agreement dated as of April 7, 2008 between Cheniere Pipeline Company and Environmental Safety and Health Consulting Services, Inc.
|
6)
|
Master Service Agreement dated June 25, 2007 between Cheniere Pipeline Company and Industrial Solutions Group, L.L.C., and amended by Agreement Letter dated as of March 15, 2011
|
7)
|
Service Provider Agreement dated as of June 15, 2007 between Cheniere Pipeline Company and IRTH Solutions, Inc.
|
8)
|
Master Service Agreement dated as of October 14, 2011 between Cheniere Pipeline Company and L & L Sandblasting, Inc.
|
9)
|
Master Service Agreement dated as of April 26, 2010 between Cheniere Pipeline Company and M&H Energy Services
|
10)
|
Environmental Spill Response and Clean Up Master Service Agreement dated April 7, 2008 between Cheniere Pipeline Company and Oil Mop, L.L.C.
|
11)
|
Master Service Agreement dated as of June 28, 2010 between Cheniere Pipeline Company and R&M Energy Systems
|
12)
|
Master Service Agreement dated as of July 19, 2011 between Cheniere Pipeline Company and Reserve Compression Corp.
|
13)
|
Master Service Agreement dated as of March 26, 2008 between Cheniere Pipeline Company and Sagebrush Pipeline Equipment Co., Inc., amended by Letter Agreements dated December 7, 2009 and March 24, 2010
|
14)
|
Master Service Agreement dated as of April 22, 2010 between Cheniere Pipeline Company and TDW Services, Inc.
|
15)
|
Master Service Agreement dated as of September 23, 2011 between Cheniere Pipeline Company and Universal Ensco Inc.
|
16)
|
Master Service Agreement dated as of August 13, 2012 between Cheniere Pipeline Company and Bolt Geographic, Inc.
|
17)
|
Master Service Agreement dated as of August 10, 2010 between Cheniere Pipeline Company and Willbros Construction (U.S.) LLC
|
(a)
|
explosion, fire, nuclear radiation or chemical or biological contamination, hurricane, tropical storm, tornado, lightning, earthquake, flood, unusually severe weather, natural disaster, epidemic, any other act of God, and any other similar circumstance;
|
(b)
|
war and other hostilities (whether declared or not), revolution, public disorder, insurrection, rebellion, sabotage, or terrorist action;
|
(c)
|
failure of any third party supplier, where the failure is due to an event which constitutes force majeure under the Manager's or the Project Company's contract with that party;
|
(d)
|
any action taken by any government authority after the date of this Agreement, including, without limitation, any order, legislation, enactment, judgment, ruling, or decision thereof;
|
(e)
|
Labor Disputes; and
|
(f)
|
major equipment failure;
|
(a)
|
provide prompt written notice to the other of the occurrence of the Force Majeure Event, which notice shall provide details with respect to the circumstances
|
|
constituting the Force Majeure Event, an estimate of its expected duration, and the probable impact on the performance of its obligations hereunder;
|
(b)
|
use all reasonable efforts to continue to perform its obligations hereunder;
|
(c)
|
take all reasonable action to correct or cure the event or condition constituting the Force Majeure Event;
|
(d)
|
use all reasonable efforts to mitigate or limit the adverse effects of the Force Majeure Event, to the extent such action would not adversely affect its own interests; and
|
(e)
|
provide prompt written notice to the other Party of the cessation of the Force Majeure Event.
|
7.8
|
Following the occurrence of a Force Majeure Event, the Manager (a) shall take all reasonable measures to mitigate or limit the amount of Ancillary Expenses until the effects of the Force Majeure Event are remedied, (b) shall consult with the Project Company with respect to its plan to mitigate or limit such Ancillary Expenses, and (c) shall take such actions as are reasonably directed by the Project Company after consultation with the Manager. The Project Company shall continue to pay such reduced Ancillary Expenses and the Construction Management Fee as provided herein.
|
1.
|
Maintaining or providing for maintenance of the principal office and registered office of the Project Company, acting as the registered agent of the Project Company, and maintaining the books and records of the Project Company.
|
2.
|
Taking actions to maintain the continued existence of the Project Company, its qualification to do business and its registration under any applicable assumed or fictitious name, statute or similar law in each state in which the Project Company owns property or transacts business.
|
3.
|
Exercising the day-to-day management of the Project Company's affairs and business.
|
4.
|
Providing or arranging for the necessary human resources and other administrative support necessary to perform the Services or cause the Services to be performed, including, without limitation, in the Manager's discretion relying on contractual arrangements with other personnel and Service Providers who are Affiliates of the Manager.
|
5.
|
Managing compliance with the Project Company's tax reporting obligations and its legal and regulatory obligations, including, without limitation, the requirements of the Federal Energy Regulatory Commission, the Pipeline and Hazardous Materials Safety Administration, the Environmental Protection Agency and the State of Louisiana environmental and pipeline safety agencies.
|
6.
|
Procuring and maintaining all required governmental approvals and permits and prepare and submit all filings which are required to be made thereunder; provided that if responsibility therefor has been delegated to a Service Provider, the Manager shall supervise and monitor such Service Provider's performance of such delegated activity or duty.
|
7.
|
Preparing business planning and forecasting reports from time to time for the benefit of the Project Company.
|
8.
|
Providing invoices and collecting on behalf of the Project Company, or causing to be so collected, all payments due to the Project Company, and promptly (but in no event later than the date such payment is due and payable) remitting or directing to be remitted from funds of the Project Company amounts in payment of the expenses and expenditures of the Company, including, without limitation, aging payables and receivables, making borrowing and other requests of the Project Company's lenders and their agents, and managing letter of credit and outside credit sources; provided that nothing herein shall imply any guarantee or undertaking by the Manager with respect to the collection of amounts due to the Project Company which remain uncollected after commercially reasonable efforts by the Manager.
|
9.
|
Arranging for the purchase or leasing, at the sole expense of the Project Company, any materials, commodities supplies and equipment necessary for the performance of the Services to the extent permitted by the Project Company's agreements with its lenders, and nothing herein shall imply any duty of the Manager under any circumstances to expend its own funds in payment of the expenses of the Project Company.
|
10.
|
Determining the need for, establishing and making draws under the Project Company's capital facilities and establish appropriate reserves, in each case as it determines necessary to meet the Project Company's cash flow requirements and cause such funds to be deposited into the Project Company's accounts.
|
11.
|
Maintaining bank and brokerage accounts, financial books and records of the Project Company's business and operations in accordance with prudent business practices and generally accepted accounting practices.
|
12.
|
Preparing and filing or causing to be prepared and filed on behalf of the Project Company on a timely basis all federal, state and local tax returns and related information and filings required to be filed by the Project Company, paying out of the Project Company's funds all taxes and other governmental charges shown to be due thereon before they become delinquent and making all tax elections believed by the Manager to be necessary or desirable for the Project Company and its partners.
|
13.
|
Within forty-five (45) days after the end of each calendar quarter, preparing together with the Operator, (i) a status report relating to the Facilities' operations for such quarter, which will detail variances between actual and forecasted performance, and include (A) information on utilization and efficiencies of physical operations and (B) a projection of forecasted performance for the remaining quarters of the calendar year if there is material change from the previous forecast for the same period, and (ii) an unaudited internal financial statement and income statement for such quarter prepared in accordance with GAAP.
|
14.
|
Providing contract administration services for all contracts associated with the Facilities, including, without limitation, daily management reports, supervising and monitoring the Service Providers with respect to their performance of services for the Project Company, and where necessary or desirable and with the consent of the Project Company, at the Project Company's sole expense, enforcing the compliance of each Service Provider with its obligations to the Project Company, provided that the Manager's responsibility for matters which are subject to the Project Company's arrangements with Service Providers shall consist solely of such supervision, monitoring and enforcement and shall not include responsibility for the proper performance of any such matters.
|
15.
|
If required by the Project Company's lenders, causing the Project Company's certified public accountant to prepare, review and submit annual audited financial statements for the Project Company, prepared in accordance with GAAP as soon as reasonably possible and in any event within one hundred and twenty (120) days after the end of each calendar
|
16.
|
Representing the Project Company in business matters with, and maintain good relations with, the Service Providers and other third parties, and execute on behalf of the Project Company such additional documents reasonably deemed necessary or desirable by the Manager to effectuate the transactions and agreements necessary for the operation and management of the Facilities in the normal course of business.
|
17.
|
Making arrangements for the Project Company to obtain and maintain all insurance required by the O&M Agreement and any other agreement obligating the Facilities with respect to insurance, and such other insurance as is necessary and prudent;
provided
that
, in no event shall the Manager be responsible or liable for Project Company's failure to obtain or maintain insurance where such insurance is not commercially available to Facilities.
|
18.
|
Not taking any action as would cause the Project Company to violate or be in violation in any material respect of any federal, state or local laws and regulations, including, without limitation, environmental laws and regulations, and to the extent that the Manager has knowledge of any such existing or prospective violation take, or direct Service Providers to take, commercially reasonable actions, at the sole expense of the Project Company to redress or mitigate any such violation.
|
19.
|
Using all reasonable efforts to cause the Project Company to take all actions required and perform all of its obligations under the Project Contracts and not take any action as would reasonably be expected to cause the Project Company to violate or be in violation of any Project Contract, and to the extent the Manager has knowledge of any existing or prospective violation take, or direct Service Providers (including, without limitation, the Operator) to take, commercially reasonable actions, at the sole expense of the Project Company, or such Service Provider as the case may be, to redress or mitigate any such violation.
|
(1)
|
Workers Compensation and Employers Liability Insurance
: The Manager shall comply with all applicable law with respect to workers' compensation requirements and other similar requirements where the Services are performed. Such coverage shall include coverage for all states and other applicable jurisdictions, voluntary compensation coverage, alternate employer endorsement and occupational disease. If the Services are to be performed on or near navigable waters, the policy(ies) shall include coverage for United States Longshoremen's and Harbor Workers Act, and, if applicable, coverage for the Death on the High Seas Act, the Jones Act, the Outer Continental Shelf Lands Act and any other applicable law regarding maritime law. A maritime employer's liability policy may be used to satisfy applicable parts of this requirement with respect to Services performed on navigable waters. If the Manager is not required by applicable law to carry Workers' Compensation insurance, then the Manager shall provide the types and amounts that are mutually agreed between the Manager and the Project Company.
|
(2)
|
Commercial General Liability
: Commercial General Liability insurance on an occurrence basis covering against claims occurring anywhere in the world for the Manager's liability for bodily injury (including bodily injury and death), property damage (including loss of use) and personal injury. Such insurance shall provide coverage for products and completed operations, blanket contractual, broad form property damage and independent contractors.
|
(3)
|
Automobile Liability
: Commercial Automobile Liability covering the Manager's liability arising out of claims for bodily injury and property damage for all owned and non-owned, leased or hired vehicles of the Manager, including loading and unloading thereof and appropriate no-fault provisions wherever applicable.
|
|
(5)
Fidelity
: Fidelity insurance providing coverage for employee dishonesty including theft, computer funds transfer fraud, alteration and forgery insuring loss of money, securities or other property resulting from any fraudulent or dishonest act committed by the Manager's or any of its Affiliates' employees, whether acting alone or in collusion with others in an amount not less than $10,000,000 and a deductible not greater than $25,000
each loss.
|
PROJECT NAME:
Sabine Pass LNG Liquefaction Facility
OWNER:
Sabine Pass Liquefaction, LLC
CONTRACTOR:
Bechtel Oil, Gas and Chemicals, Inc.
DATE OF AGREEMENT: November 11, 2011
|
CHANGE ORDER NUMBER:
CO-00021
DATE OF CHANGE ORDER:
April 17, 2013
|
1.
|
The Insurance Provisional Sum specified in Article 1.3 of Attachment EE, Schedule EE-1 of the Agreement was originally *** U.S. Dollars (U.S. $***). Change Order CO-00002, executed on June 4, 2012, increased the value by $*** resulting in a new Insurance Provisional Sum of *** U.S. Dollars (U.S. $***). This Change Order will increase the Insurance Provisional Sum by $*** for a new value of *** U.S. Dollars (U.S. $***).
|
2.
|
The Aggregate Provisional Sum prior to this Change Order was Two Hundred Fifty Eight Million, Seven Hundred Four Thousand, Four Hundred Sixty One U.S. Dollars (U.S. $258,704,461). This Change Order will amend that value and the new value shall be Three Hundred One Million, Two Hundred Eighty Seven Thousand, Eight Hundred Twenty Nine U.S. Dollars (U.S. $301,287,829).
|
3.
|
This Change Order will increase the Contract price by an amount of $42,583,368 which will all be allocated to an increase in the aggregate provisional sum as noted in item 2 of this Change Order. Accordingly, the Agreement is modified as follows:
|
a.
|
Schedule C-1 (Milestone Payment Schedule) of Attachment C of the Agreement will be amended by including the Milestone(s) listed in Exhibit A of this Change Order.
|
4.
|
The overall cost breakdown data associated with securing the required Insurance is provided in Exhibit B of this Change Order.
|
/s/ ***
|
|
/s/***
|
Owner
|
|
Contractor
|
***
|
|
***
|
Name
|
|
Name
|
VP LNG Project Management
|
|
Sr. Vice President
|
Title
|
|
Title
|
May 6, 2013
|
|
April 19, 2013
|
Date of Signing
|
|
Date of Signing
|
PROJECT NAME:
Sabine Pass LNG Liquefaction Facility
OWNER:
Sabine Pass Liquefaction, LLC
CONTRACTOR:
Bechtel Oil, Gas and Chemicals, Inc.
DATE OF AGREEMENT: November 11, 2011
|
CHANGE ORDER NUMBER:
CO-00022
DATE OF CHANGE ORDER:
May 8, 2013
|
1.
|
Per Article 6.1.B of the Agreement, Parties agree Bechtel will cancel all work associated with Items 1(a-e), 8, and 13 of Change Order 00015, dated November 8, 2012, wherein Bechtel and Owner agreed to install two static mixers at the East and West Jetty locations in the Existing Facility.
|
a.
|
The Previous Existing Facility Labor Provisional Sum in Article 2.2 of Attachment EE of the Agreement was *** U.S. Dollars ($***) and *** hours for direct craft. This Change Order will amend the previous values respectively to *** U.S. Dollars ($***) and *** hours.
|
b.
|
The previous Aggregate Provisional Sum prior to this Change Order was Three Hundred One Million, Two Hundred Eighty Seven Thousand, Eight Hundred Twenty Nine U.S. Dollars (U.S. $301,287,829). This Change Order will amend that value and the new value shall be Three Hundred Million, Nine Hundred Forty One Thousand, Five Hundred Twenty Two U.S. Dollars ($300,941,522).
|
2.
|
This Contract Change Order will decrease the Contract price by a fixed lump sum amount of $3,186,779. Accordingly, the Agreement is modified as follows:
|
a.
|
Schedule C-1 (Milestone Payment Schedule) of Attachment C of the Agreement will be amended by including the Milestone(s) listed in Exhibit A of this Change Order.
|
3.
|
The overall cost breakdown data for this change is provided in Exhibit B of this Change Order.
|
/s/ ***
|
|
/s/ ***
|
Owner
|
|
Contractor
|
***
|
|
***
|
Name
|
|
Name
|
VP LNG Project Management
|
|
Sr. Vice President
|
Title
|
|
Title
|
June 10, 2013
|
|
May 8, 2013
|
Date of Signing
|
|
Date of Signing
|
PROJECT NAME:
Sabine Pass LNG Liquefaction Facility
OWNER:
Sabine Pass Liquefaction, LLC
CONTRACTOR:
Bechtel Oil, Gas and Chemicals, Inc.
DATE OF AGREEMENT: November 11, 2011
|
CHANGE ORDER NUMBER:
CO-00023
DATE OF CHANGE ORDER:
May 30, 2013
|
1.
|
Per Article 6.1.B of the Agreement, Parties agree Bechtel will revise the LNG Rundown Line to provide operational flexibility enabling Owner to send LNG from Trains 1 and 2 to Tanks 1, 2, and 3 during ship loading. The work will be completed in accordance with the Scope of Work detailed in Exhibit A of this Change Order.
|
2.
|
This Contract Change Order will increase the Contract price by an amount of $8,689,836 which includes $2,819,408 Provisional Sum and $5,870,428 lump sum adjustment. Accordingly, the Agreement is modified as follows:
|
a.
|
Schedule C-1 (Milestone Payment Schedule) of Attachment C of the Agreement will be amended by including the Milestone(s) listed in Exhibit C of this Change Order.
|
3.
|
The overall cost breakdown data for this change is provided in Exhibit D of this Change Order.
|
4.
|
Exhibit D details the cost breakdown for the Provisional Sum portion of this Change Order:
|
a.
|
The Previous Existing Facility Labor Provisional Sum in Article 2.2 of Attachment EE of the Agreement was *** U.S. Dollars ($***) and *** direct man hours. This Change Order will amend the previous values respectively to *** U.S. Dollars ($***) and *** hours.
|
b.
|
The previous Aggregate Provisional Sum prior to this Change Order was Three Hundred Million, Nine Hundred Forty One Thousand, Five Hundred Twenty Two U.S. Dollars ($300,941,522). This Change Order will amend that value and the new value shall be Three Hundred Three Million, Seven Hundred Sixty Thousand, Nine Hundred Thirty U.S. Dollars ($303,760,930).
|
5.
|
Drawings for this Change Order are provided in Exhibit E.
|
/s/ ***
|
|
/s/ ***
|
Owner
|
|
Contractor
|
***
|
|
***
|
Name
|
|
Name
|
VP LNG Project Management
|
|
Principal Vice President
|
Title
|
|
Title
|
June 24, 2013
|
|
June 4, 2013
|
Date of Signing
|
|
Date of Signing
|
PROJECT NAME:
Sabine Pass LNG Liquefaction Facility
OWNER:
Sabine Pass Liquefaction, LLC
CONTRACTOR:
Bechtel Oil, Gas and Chemicals, Inc.
DATE OF AGREEMENT: November 11, 2011
|
CHANGE ORDER NUMBER:
CO-00024
DATE OF CHANGE ORDER:
June 11, 2013
|
1.
|
Per Article 6.1.B of the Agreement, Parties agree Bechtel will revise the routing of the stabilized condensate line and condensate header to ensure spill containment. The scope of work is detailed below:
|
a.
|
Within the battery limit, the stabilized condensate line will be routed as a 3” line to the north from the Condensate Stabilizer V-1810.
|
b.
|
Upon exiting the north ISBL, the stabilized condensate line will tie into a 6” condensate header within the 135R02 pipe rack.
|
c.
|
3” double block and bleed valves will be provided for Trains 3 and 4 within the 135R02 pipe rack.
|
d.
|
6” double block and bleed valves for Stage 2 condensate header tie-in will be deleted. These were previously provided in executed Change Order CO-00017, dated December 21, 2012.
|
e.
|
The 6” condensate header will be routed in the following way:
|
i.
|
West to east through pipe rack 135R02;
|
ii.
|
South through 135R01;
|
iii.
|
East through pipe rack 121R02 and 121R01
|
iv.
|
South through 126R02
|
f.
|
The 4” double block and bleed valves will be provided for a future connection at the intersection of pipe racks 121R01 and 126R01. The tie-ins will be oriented to the east.
|
g.
|
Exclusions and clarifications for this scope of work include:
|
i.
|
No pre-investment piping for Stage 2 will be provided - only double block and bleed tie-in valves for Trains 3 and 4.
|
ii.
|
No off-specification condensate handling system will be provided. Handling of off-specification condensate from Unit 18 will be SPL's responsibility.
|
iii.
|
No isolation valves will be provided at the SPL/Bechtel interface location. Isolation valves are already provided at the battery limit of each LNG train.
|
iv.
|
SPL/Bechtel tie-in interface will be located at the mid-level pipe rack, elevation 145'-6”, rather than the lower level originally requested by SPL due to congestion.
|
v.
|
The safety review of Unit 23 and the closure of action items 18.04 and 18.06 from the unit 18 HAZOP will be SPL's responsibility and excluded from this Change Order.
|
vi.
|
Any modifications to systems upstream of SPL's scope of work resulting from the subsequent Unit 23 safety review are excluded from this Change Order.
|
2.
|
Exhibit A details the cost breakdown for the condensate header portion of the Change Order.
|
3.
|
Exhibit B shows the changes to the drawings associated with this portion of the Change Order.
|
4.
|
Per Article 6.1.B of the Agreement, Parties agree Bechtel will provide HVAC stacks on electrical substation buildings in the process area to avoid ethylene vapor clouds in the area of the substation building. The scope of work is detailed below:
|
a.
|
Each HVAC unit at the substation will have a dedicated stainless steel, self-supporting air intake stack. The pads for the HVAC units will be extended to include the air intake stacks.
|
b.
|
The specific units associated with this portion of the scope are detailed in Exhibit G.
|
5.
|
Exhibit C details the cost breakdown for the HVAC stacks portion of this Change Order.
|
6.
|
Per Article 6.1.B of the Agreement, Parties agree Bechtel will direct its piling contractor to install piles at the Inlet Feed Gas Metering Stations as provided for in Exhibit H. The scope of work is detailed below:
|
a.
|
Soil improvement in this area will be extended to a depth of 6 feet.
|
b.
|
SPL will be responsible for installing fencing, pile caps, related site work, access ways, and all other work within the Gas Metering Station area.
|
7.
|
Exhibit D details the cost breakdown for installation of additional piles at the Metering Station.
|
8.
|
The overall cost breakdown for these changes is detailed in Exhibit E and described as follows:
|
a.
|
This Change Order will increase the Contract price by a fixed lump sum amount of $3,398,169.
|
b.
|
The Previous Existing Facility Labor Provisional Sum in Article 2.2 of Attachment EE of the Agreement was *** U.S. Dollars ($***) and *** hours. This Change Order will amend the previous values respectively to *** U.S. Dollars ($***) and *** hours.
|
c.
|
The previous Aggregate Provisional Sum prior to this Change Order was Three Hundred Three Million, Seven Hundred Sixty Thousand, Nine Hundred Thirty U.S. Dollars ($303,760,930). This Change Order will amend that value and the new value shall be Three Hundred Three Million, Seven Hundred Seventy Five Thousand, Three Hundred Twenty Four U.S. Dollars ($303,775,324).
|
9.
|
Schedule C-1 (Milestone Payment Schedule) of Attachment C of the Agreement will be amended by including the Milestone(s) listed in Exhibit F of this Change Order.
|
/s/ ***
|
|
/s/ ***
|
Owner
|
|
Contractor
|
***
|
|
***
|
Name
|
|
Name
|
VP LNG Project Management
|
|
Principal Vice President
|
Title
|
|
Title
|
July 8, 2013
|
|
June 11, 2013
|
Date of Signing
|
|
Date of Signing
|
PROJECT NAME:
Sabine Pass LNG Liquefaction Facility
OWNER:
Sabine Pass Liquefaction, LLC
CONTRACTOR:
Bechtel Oil, Gas and Chemicals, Inc.
DATE OF AGREEMENT: November 11, 2011
|
CHANGE ORDER NUMBER:
CO-00025
DATE OF CHANGE ORDER:
June 11, 2013
|
1.
|
Per Article 6.1.B of the Agreement, Parties agree Bechtel will implement the pipeline interface modifications. The scope of work is detailed below:
|
a.
|
Addition of two (2) aboveground 48” feed gas manifolds in Bechtel's scope of work. Each manifold will have two (2) 42” flanged connections. The flanged connections will be located at Easting coordinate 2468.
|
b.
|
The four (4) 42” flanged connections also mark the ASME B31.8 scope break. All piping provided by Bechtel will be designed to ASME B31.3.
|
c.
|
The manifolds are connected by an aboveground 36” interconnecting pipe with two (2) ball valves. An equalization line and valves will be required.
|
d.
|
Routing of feed gas piping will be done by Bechtel. Each feed gas line will include an aboveground 42” ball valve with an equalization line and valves.
|
e.
|
Installation of a bridge on or over the portion of Heavy Hail Rd. crossed by the underground feed gas piping will be performed by Bechtel.
|
f.
|
Bechtel will install 2x12 fiber direct burial cables from the liquefaction facilities to the metering facilities. The cables should be in PVC/HDPE sleeves underground and protected with a concrete cap. Scope will include connecting to the sleeves at the fence line and running the fiber cables into the metering buildings and terminate in the building patch panels provided with the buildings.
|
g.
|
Bechtel to provide two (2) future underground sleeves to the fence line for future metering buildings.
|
h.
|
Increase the size of the power feeder from 30A to 50A with a second spare underground conduit/sleeve from the pipe rack to the fence line for future expansion.
|
i.
|
Pressure test on the Bechtel provided piping will be performed according to the ANSI B31.3 before the tie-ins are made with the pipeline flanges. After pressure testing, Bechtel will bolt up with pipeline flanges and torque the bolts according to the requirements.
|
j.
|
The drawing entitled Exhibit A of this Change Order depicts the work for the scope listed above.
|
2.
|
Per Article 6.1B of the Agreement, Parties agree Bechtel will address the following changes and impacts resulting from SPL, LLC increasing the footprint of the Metering Station area:
|
a.
|
The warehouse and the associated trailer will be moved to Laydown Yard 1 and require electrical changes.
|
b.
|
New fencing will be added around the metering skid by SPL.
|
c.
|
Bechtel subcontractor will extend the fiber connection to the new warehouse location.
|
d.
|
The drawings entitled Exhibit B depict the location for the changes and impacts of the increased footprint.
|
3.
|
This Contract Change Order will increase the Contract price by an amount of $10,791,224 which includes $16,800 Provisional Sum and $10,774,424 lump sum.
|
4.
|
Exhibit C details the lump sum cost breakdown for this portion of the Change Order.
|
5.
|
The overall cost breakdown for this Change Order is detailed in Exhibit D and described as follows:
|
a.
|
The previous Soils Provisional Sum in Article 2.1 of Attachment EE of the Agreement was *** U.S. Dollars ($***). This Change Order will amend the previous value and increase the value by $***. The new Soils Provisional Sum is now *** U.S. Dollars ($***).
|
b.
|
The previous Aggregate Provisional Sum prior to this Change Order was Three Hundred Three Million, Seven Hundred Seventy Five Thousand, Three Hundred Twenty Four U.S. Dollars ($303,775,324). This Change Order will amend that value and the new value shall be Three Hundred Three Million, Seven Hundred Ninety Two Thousand, One Hundred Twenty Four U.S. Dollars ($303,792,124).
|
6.
|
Schedule C-1 (Milestone Payment Schedule) of Attachment C of the Agreement will be amended by including the Milestone(s) listed in Exhibit E of this Change Order.
|
/s/ ***
|
|
/s/ ***
|
Owner
|
|
Contractor
|
***
|
|
***
|
Name
|
|
Name
|
VP LNG Project Management
|
|
Principal Vice President
|
Title
|
|
Title
|
|
|
June 11, 2013
|
Date of Signing
|
|
Date of Signing
|
PROJECT NAME:
Sabine Pass LNG Stage 2 Liquefaction Facility
OWNER:
Sabine Pass Liquefaction, LLC
CONTRACTOR:
Bechtel Oil, Gas and Chemicals, Inc.
DATE OF AGREEMENT: December 20, 2012
|
CHANGE ORDER NUMBER:
CO-0001
DATE OF CHANGE ORDER:
June 4, 2013
|
1.
|
Per Article 6.1.B of the Agreement, Parties agree Bechtel will provide HVAC stacks on electrical substation buildings in the process area to avoid ethylene vapor clouds in the area of the substation building. The scope of work is detailed below:
|
a.
|
Each HVAC unit at the substation will have a dedicated stainless steel, self-supporting air intake stack. The pads for the HVAC units will be extended to include the air intake stacks.
|
b.
|
The specific units associated with this portion of the scope are detailed in Exhibit D
|
2.
|
This Contract Change Order will increase the Contract price by a fixed lump sum amount of $1,123,291. Accordingly, the Agreement is modified as follows:
|
a.
|
Schedule C-1 (Milestone Payment Schedule) of Attachment C of the Agreement will be amended by including the Milestone(s) listed in Exhibit A of this Change Order.
|
3.
|
Exhibit B details the cost breakdown of this Change Order.
|
4.
|
Drawings for this Change Order are provided in Exhibit C.
|
/s/ ***
|
|
/s/ ***
|
Owner
|
|
Contractor
|
***
|
|
***
|
Name
|
|
Name
|
VP LNG Project Management
|
|
Principal Vice President
|
Title
|
|
Title
|
June 14, 2013
|
|
June 4, 2013
|
Date of Signing
|
|
Date of Signing
|
PROJECT NAME:
Sabine Pass LNG Stage 2 Liquefaction Facility
OWNER:
Sabine Pass Liquefaction, LLC
CONTRACTOR:
Bechtel Oil, Gas and Chemicals, Inc.
DATE OF AGREEMENT: December 20, 2012
|
CHANGE ORDER NUMBER:
CO-0002
DATE OF CHANGE ORDER:
May 30, 2013
|
1.
|
Per Article 6.1.B of the Agreement, Parties agree Bechtel will revise the LNG Rundown Line to provide operational flexibility enabling Owner to send LNG from Trains 3 and 4 to Tanks 1, 2, and 3 during ship loading. The work will be completed in accordance with the Scope of Work detailed in Exhibit A of this Change Order.
|
2.
|
This Contract Change Order will increase the Contract price by a fixed lump sum amount of $4,312,798 which includes $1,381,806 Provisional Sum and $2,930,992 lump sum adjustments. Accordingly, the Agreement is modified as follows:
|
a.
|
Schedule C-1 (Milestone Payment Schedule) of Attachment C of the Agreement will be amended by including the Milestone(s) listed in Exhibit C of this Change Order.
|
3.
|
The overall cost breakdown associated with this Change Order is detailed in Exhibit C of this Change Order.
|
4.
|
Exhibit D details the cost breakdown for the Provisional Sum portion of this Change Order:
|
a.
|
The Previous Existing Facility Labor Provisional Sum in Article 2.2 of Attachment EE of the Agreement was *** U.S. Dollars ($***) and *** direct man hours. This Change Order will amend the previous values respectively to *** U.S. Dollars ($***) and *** hours.
|
b.
|
The previous Aggregate Provisional Sum prior to this Change Order was Seven Hundred Eighty Million, Nine Hundred Fifty Thousand, Nine Hundred and Six U.S. Dollars ($780,950,906). This Change Order will amend that value and the new value shall be Seven Hundred Eighty Two Million, Three Hundred Thirty Two Thousand, Seven Hundred Twelve U.S. Dollars ($782,332,712).
|
5.
|
Drawings for Change Order are provided in Exhibit E.
|
/s/ ***
|
|
/s/ ***
|
Owner
|
|
Contractor
|
***
|
|
***
|
Name
|
|
Name
|
VP LNG Project Management
|
|
Principal Vice President
|
Title
|
|
Title
|
June 14, 2013
|
|
June 4, 2013
|
Date of Signing
|
|
Date of Signing
|
PROJECT NAME:
Sabine Pass LNG Liquefaction Facility - Stage 2
OWNER:
Sabine Pass Liquefaction, LLC
CONTRACTOR:
Bechtel Oil, Gas and Chemicals, Inc.
DATE OF AGREEMENT: December 20, 2012
|
CHANGE ORDER NUMBER:
CO-0003
DATE OF CHANGE ORDER:
May 29, 2013
|
1.
|
The Currency Provisional sum specified in Article 1.1 of Attachment EE, Schedule EE-1 of the Agreement prior to this Change Order was U.S. ***. The Currency Provisional Sum is decreased by $***. The new value of the Currency Provisional Sum as adjusted by this Change Order is $***.
|
2.
|
Schedule C-1 (Milestone Payment Schedule) of Attachment C of the Agreement will be amended by including the milestone(s) listed in Exhibit A of this Change Order.
|
3.
|
The Aggregate Provisional Sum specified in Article 7.1A of the Agreement prior to this Change Order was $780,950,906. The Aggregate Provisional Sum is decreased by this Change Order in the amount of $497,588,968. As a result, the new Aggregate Provisional Sum as adjusted by this Change Order is $283,361,938.
|
4.
|
Pursuant to instructions in Article 1.1 of Attachment EE, Schedule EE-1 of the Agreement, Exhibit B to this Change Order illustrates the calculation of the final Currency costs in the Agreement.
|
/s/ ***
|
|
/s/ ***
|
Owner
|
|
Contractor
|
***
|
|
***
|
Name
|
|
Name
|
VP LNG Project Management
|
|
Principal Vice President
|
Title
|
|
Title
|
June 14, 2013
|
|
June 4, 2013
|
Date of Signing
|
|
Date of Signing
|
PROJECT NAME:
Sabine Pass LNG Liquefaction Facility - Stage 2
OWNER:
Sabine Pass Liquefaction, LLC
CONTRACTOR:
Bechtel Oil, Gas and Chemicals, Inc.
DATE OF AGREEMENT: December 20, 2012
|
CHANGE ORDER NUMBER:
CO-0004
DATE OF CHANGE ORDER:
May 29, 2013
|
1.
|
The Fuel Provisional sum specified in Article 1.2 of Attachment EE, Schedule EE-1 of the Agreement prior to this Change Order was U.S.$***. The Fuel Provisional Sum is decreased by $***. The new value of the Fuel Provisional Sum as adjusted by this Change Order is $***.
|
2.
|
Schedule C-1 (Milestone Payment Schedule) of Attachment C of the Agreement will be amended by including the milestone(s) listed in Exhibit A of this Change Order.
|
3.
|
The Aggregate Provisional Sum specified in Article 7.1A of the Agreement prior to this Change Order was $283,361,938. The Aggregate Provisional Sum is decreased by $22,668,796. As a result, the new Aggregate Provisional Sum as adjusted by this Change Order is $260,693,142.
|
4.
|
Pursuant to instructions in Article 1.2 of Attachment EE, Schedule EE-1 of the Agreement, Exhibit B to this Change Order illustrates the calculation of the final fuel costs in the Agreement.
|
/s/ ***
|
|
/s/ ***
|
Owner
|
|
Contractor
|
***
|
|
***
|
Name
|
|
Name
|
VP LNG Project Management
|
|
Principal Vice President
|
Title
|
|
Title
|
June 14, 2013
|
|
June 4, 2013
|
Date of Signing
|
|
Date of Signing
|
Re:
|
|
Engagement of Consultant Under Investors' and Registration Rights Agreement
|
By:
|
Blackstone CQP Holdco GP LLC, its
|
|||
|
|
general partner
|
||
|
|
|
|
|
By:
|
Blackstone Management Associates VI L.L.C.,
|
|||
|
|
its sole member
|
||
|
|
|
|
|
By:
|
BMA VI L.L.C., its sole member
|
|||
|
|
|
|
|
By:
|
/s/ Sean Klimczak
|
|||
Name:
|
Sean Klimczak
|
|||
Title:
|
Senior Managing Director
|
Cheniere Energy Partners, L.P.
|
||
By:
|
Cheniere Energy Partners GP, LLC,
|
|
|
its general partner
|
|
|
|
|
By:
|
/s/ H. Davis Thames
|
|
|
Name:
|
H. Davis Thames
|
|
Title:
|
Senior Vice President and
|
|
|
Chief Financial Officer
|
By:
|
Blackstone CQP Holdco GP LLC, its
|
|||
|
|
general partner
|
||
|
|
|
|
|
By:
|
Blackstone Management Associates VI L.L.C.,
|
|||
|
|
its sole member
|
||
|
|
|
|
|
By:
|
BMA VI L.L.C., its sole member
|
|||
|
|
|
|
|
By:
|
/s/ Sean Klimczak
|
|||
Name:
|
Sean Klimczak
|
|||
Title:
|
Senior Managing Director
|
/s/ Philip Meier
|
||
Philip Meier
|
||
|
|
|
|
|
|
/s/ Meier Consulting LLC
|
||
Meier Consulting LLC
|
▪
|
Cheniere
|
▪
|
Blackstone technical interface with project team
|
▪
|
Work with Keith Teague and construction management to ensure delivery of project
|
▪
|
Review Bechtel's construction reports
|
▪
|
Monitor Bechtel's progress, challenge procedures as necessary, and ensure transparent reporting
|
▪
|
Member of Cheniere Energy Partners LP Board
|
▪
|
Other Projects
|
▪
|
Technical advisor to ongoing and future project engagements
|
▪
|
Meet with management teams and contractors as necessary to provide technical job assessments and assist management, as deemed appropriate by Blackstone
|
▪
|
Review and advise on contracting plans and strategies and provide input on contract terms
|
▪
|
Site visits as necessary to inspect and validate progress and quality
|
▪
|
Member of project boards as deemed necessary by Blackstone
|
▪
|
Manage periodic progress meetings with projects and address issues
|
COMPANY:
|
|
|||
|
|
|
|
|
CHENIERE ENERGY PARTNERS GP,
|
|
|||
LLC
|
|
|
|
|
|
|
|
|
|
By:
|
|
|
|
|
Printed Name:
|
|
|
||
Title:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PARTICIPANT:
|
|
|||
By:
|
|
|||
|
|
(Signature)
|
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Cheniere Energy Partners, L.P.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
/s/ Charif Souki
|
Charif Souki
Chief Executive Officer of Cheniere Energy Partners GP, LLC,
general partner of Cheniere Energy Partners, L.P.
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Cheniere Energy Partners, L.P.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
/s/ H. Davis Thames
|
H. Davis Thames
Senior Vice President and Chief Financial Officer of Cheniere Energy Partners GP, LLC,
general partner of Cheniere Energy Partners, L.P.
|
(1)
|
The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Partnership.
|
/s/ Charif Souki
|
Charif Souki
Chief Executive Officer of Cheniere Energy Partners GP, LLC, general partner of Cheniere Energy Partners, L.P.
|
(1)
|
The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Partnership.
|
/s/ H. Davis Thames
|
H. Davis Thames
Senior Vice President and Chief Financial Officer of Cheniere Energy Partners GP, LLC, general partner of Cheniere Energy Partners, L.P.
|