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Delaware
|
333-192373
|
27-3235920
|
(State or other jurisdiction of incorporation or organization)
|
(Commission File Number)
|
(I.R.S. Employer Identification No.)
|
|
|
|
700 Milam Street, Suite 1900
Houston, Texas
|
|
77002
|
(Address of principal executive offices)
|
|
(Zip Code)
|
|
|
|
|
|
Large accelerated filer
¨
|
Accelerated filer
¨
|
Non-accelerated filer
x
|
Smaller reporting company
¨
|
(Do not check if a smaller reporting company)
|
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|
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|
|
Bcf
|
|
billion cubic feet
|
Bcf/d
|
|
billion cubic feet per day
|
Bcf/yr
|
|
billion cubic feet per year
|
DOE
|
|
U.S. Department of Energy
|
EPC
|
|
engineering, procurement and construction
|
FERC
|
|
Federal Energy Regulatory Commission
|
FTA countries
|
|
countries with which the United States has a free trade agreement providing for national treatment for trade in natural gas
|
GAAP
|
|
generally accepted accounting principles in the United States
|
Henry Hub
|
|
the final settlement price (in USD per MMBtu) for the New York Mercantile Exchange’s Henry Hub natural gas futures contract for the month in which a relevant cargo’s delivery window is scheduled to begin
|
LIBOR
|
|
London Interbank Offered Rate
|
LNG
|
|
liquefied natural gas, a product of natural gas consisting primarily of methane (CH
4
) that is in liquid form at near atmospheric pressure
|
MMBtu
|
|
million British thermal units, an energy unit
|
mtpa
|
|
million tonnes per annum
|
non-FTA countries
|
|
countries with which the United States does not have a free trade agreement providing for national treatment for trade in natural gas and with which trade is permitted
|
SEC
|
|
Securities and Exchange Commission
|
SPA
|
|
LNG sale and purchase agreement
|
Train
|
|
an industrial facility comprised of a series of refrigerant compressor loops used to cool natural gas into LNG
|
TUA
|
|
terminal use agreement
|
Cheniere
|
|
Cheniere Energy, Inc.
|
Cheniere Investments
|
|
Cheniere Energy Investments, LLC
|
Cheniere Marketing
|
|
Cheniere Marketing, LLC and subsidiaries
|
Cheniere Partners
|
|
Cheniere Energy Partners, L.P.
|
Cheniere Terminals
|
|
Cheniere LNG Terminals, LLC
|
CTPL
|
|
Cheniere Creole Trail Pipeline, L.P.
|
SPLNG
|
|
Sabine Pass LNG, L.P.
|
PART I.
|
FINANCIAL INFORMATION
|
ITEM 1.
|
FINANCIAL STATEMENTS
|
|
|
June 30,
|
|
December 31,
|
||||
|
|
2016
|
|
2015
|
||||
ASSETS
|
|
(unaudited)
|
|
|
||||
Current assets
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
—
|
|
|
$
|
—
|
|
Restricted cash
|
|
263,114
|
|
|
189,260
|
|
||
Accounts and other receivables
|
|
71,311
|
|
|
577
|
|
||
Accounts receivable—affiliate
|
|
309
|
|
|
2,457
|
|
||
Advances to affiliate
|
|
30,917
|
|
|
28,312
|
|
||
Inventory
|
|
42,002
|
|
|
5,742
|
|
||
Other current assets
|
|
15,018
|
|
|
8,412
|
|
||
Other current assets—affiliate
|
|
5,293
|
|
|
—
|
|
||
Total current assets
|
|
427,964
|
|
|
234,760
|
|
||
|
|
|
|
|
||||
Property, plant and equipment, net
|
|
10,909,556
|
|
|
9,841,407
|
|
||
Debt issuance costs, net
|
|
93,172
|
|
|
132,091
|
|
||
Non-current derivative assets
|
|
20,472
|
|
|
30,304
|
|
||
Other non-current assets
|
|
180,649
|
|
|
194,818
|
|
||
Total assets
|
|
$
|
11,631,813
|
|
|
$
|
10,433,380
|
|
|
|
|
|
|
||||
LIABILITIES AND MEMBER’S EQUITY
|
|
|
|
|
||||
Current liabilities
|
|
|
|
|
||||
Accounts payable
|
|
$
|
33,387
|
|
|
$
|
13,420
|
|
Accrued liabilities
|
|
313,656
|
|
|
201,559
|
|
||
Current debt
|
|
—
|
|
|
15,000
|
|
||
Due to affiliates
|
|
34,461
|
|
|
53,848
|
|
||
Derivative liabilities
|
|
10,373
|
|
|
6,430
|
|
||
Total current liabilities
|
|
391,877
|
|
|
290,257
|
|
||
|
|
|
|
|
||||
Long-term debt, net
|
|
10,678,545
|
|
|
9,205,559
|
|
||
Non-current derivative liabilities
|
|
13,326
|
|
|
2,884
|
|
||
Other non-current liabilities—affiliate
|
|
2,261
|
|
|
3,393
|
|
||
|
|
|
|
|
||||
Member’s equity
|
|
545,804
|
|
|
931,287
|
|
||
Total liabilities and member’s equity
|
|
$
|
11,631,813
|
|
|
$
|
10,433,380
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Revenues
|
|
|
|
|
|
|
|
||||||||
LNG revenues
|
$
|
85,326
|
|
|
$
|
—
|
|
|
$
|
85,354
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
||||||||
Operating costs and expenses
|
|
|
|
|
|
|
|
|
|
||||||
Cost (cost recovery) of sales (excluding depreciation and amortization expense shown separately below)
|
52,226
|
|
|
(70
|
)
|
|
55,914
|
|
|
(70
|
)
|
||||
Cost of sales—affiliate
|
645
|
|
|
—
|
|
|
645
|
|
|
—
|
|
||||
Operating and maintenance expense
|
11,637
|
|
|
1,322
|
|
|
16,072
|
|
|
3,032
|
|
||||
Operating and maintenance expense—affiliate
|
21,518
|
|
|
78
|
|
|
22,532
|
|
|
128
|
|
||||
Terminal use agreement maintenance expense (recovery)
|
(675
|
)
|
|
(279
|
)
|
|
(618
|
)
|
|
17,521
|
|
||||
Terminal use agreement maintenance expense—affiliate
|
—
|
|
|
143
|
|
|
208
|
|
|
178
|
|
||||
Development expense
|
70
|
|
|
1,367
|
|
|
136
|
|
|
2,518
|
|
||||
Development expense—affiliate
|
268
|
|
|
206
|
|
|
397
|
|
|
410
|
|
||||
General and administrative expense
|
2,357
|
|
|
1,562
|
|
|
3,656
|
|
|
2,720
|
|
||||
General and administrative expense—affiliate
|
15,825
|
|
|
24,791
|
|
|
32,880
|
|
|
39,366
|
|
||||
Depreciation and amortization expense
|
9,976
|
|
|
412
|
|
|
12,114
|
|
|
818
|
|
||||
Total operating costs and expenses
|
113,847
|
|
|
29,532
|
|
|
143,936
|
|
|
66,621
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Loss from operations
|
(28,521
|
)
|
|
(29,532
|
)
|
|
(58,582
|
)
|
|
(66,621
|
)
|
||||
|
|
|
|
|
|
|
|
||||||||
Other income (expense)
|
|
|
|
|
|
|
|
|
|
||||||
Interest expense, net of capitalized interest
|
(27,258
|
)
|
|
(12,915
|
)
|
|
(33,264
|
)
|
|
(19,309
|
)
|
||||
Loss on early extinguishment of debt
|
(26,305
|
)
|
|
(7,281
|
)
|
|
(26,305
|
)
|
|
(96,273
|
)
|
||||
Derivative gain (loss), net
|
(4,752
|
)
|
|
1,469
|
|
|
(16,030
|
)
|
|
(35,669
|
)
|
||||
Other income
|
146
|
|
|
158
|
|
|
250
|
|
|
222
|
|
||||
Total other expense
|
(58,169
|
)
|
|
(18,569
|
)
|
|
(75,349
|
)
|
|
(151,029
|
)
|
||||
|
|
|
|
|
|
|
|
||||||||
Net loss
|
$
|
(86,690
|
)
|
|
$
|
(48,101
|
)
|
|
$
|
(133,931
|
)
|
|
$
|
(217,650
|
)
|
|
Sabine Pass LNG-LP, LLC
|
|
Total Member’s Equity
|
||||
Balance at December 31, 2015
|
$
|
931,287
|
|
|
$
|
931,287
|
|
Capital contributions from Cheniere Partners
|
1,250
|
|
|
1,250
|
|
||
Non-cash distributions to affiliates
|
(252,802
|
)
|
|
(252,802
|
)
|
||
Net loss
|
(133,931
|
)
|
|
(133,931
|
)
|
||
Balance at June 30, 2016
|
$
|
545,804
|
|
|
$
|
545,804
|
|
|
Six Months Ended June 30,
|
||||||
|
2016
|
|
2015
|
||||
Cash flows from operating activities
|
|
|
|
||||
Net loss
|
$
|
(133,931
|
)
|
|
$
|
(217,650
|
)
|
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
|
|
|
|
||||
Non-cash terminal use agreement maintenance expense
|
160
|
|
|
16,417
|
|
||
Depreciation and amortization expense
|
12,114
|
|
|
818
|
|
||
Loss on early extinguishment of debt
|
26,305
|
|
|
96,273
|
|
||
Total losses on derivatives, net
|
28,150
|
|
|
35,144
|
|
||
Net cash used for settlement of derivative instruments
|
(3,693
|
)
|
|
(38,171
|
)
|
||
Changes in restricted cash for certain operating activities
|
129,767
|
|
|
37,976
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
||||
Accounts and other receivables
|
(70,734
|
)
|
|
(29
|
)
|
||
Advances to affiliate
|
—
|
|
|
8,383
|
|
||
Inventory
|
(22,066
|
)
|
|
198
|
|
||
Accounts payable and accrued liabilities
|
47,704
|
|
|
74,808
|
|
||
Due to affiliates
|
(562
|
)
|
|
9,467
|
|
||
Other, net
|
(8,767
|
)
|
|
(3,301
|
)
|
||
Other—affiliate
|
(4,447
|
)
|
|
(20,333
|
)
|
||
Net cash provided by (used in) operating activities
|
—
|
|
|
—
|
|
||
|
|
|
|
||||
Cash flows from investing activities
|
|
|
|
|
|
||
Property, plant and equipment, net
|
(1,216,316
|
)
|
|
(1,398,960
|
)
|
||
Use of restricted cash for the acquisition of property, plant and equipment
|
1,248,877
|
|
|
1,448,523
|
|
||
Other
|
(32,561
|
)
|
|
(49,563
|
)
|
||
Net cash provided by (used in) investing activities
|
—
|
|
|
—
|
|
||
|
|
|
|
||||
Cash flows from financing activities
|
|
|
|
|
|
||
Proceeds from issuances of debt
|
2,915,000
|
|
|
2,000,000
|
|
||
Repayments of debt
|
(1,442,305
|
)
|
|
—
|
|
||
Debt issuance and deferred financing costs
|
(21,390
|
)
|
|
(144,998
|
)
|
||
Investment in restricted cash
|
(1,452,498
|
)
|
|
(1,870,151
|
)
|
||
Capital contributions from Cheniere Partners
|
1,250
|
|
|
15,149
|
|
||
Other
|
(57
|
)
|
|
—
|
|
||
Net cash provided by (used in) financing activities
|
—
|
|
|
—
|
|
||
|
|
|
|
||||
Net increase (decrease) in cash and cash equivalents
|
—
|
|
|
—
|
|
||
Cash and cash equivalents—beginning of period
|
—
|
|
|
—
|
|
||
Cash and cash equivalents—end of period
|
$
|
—
|
|
|
$
|
—
|
|
|
|
June 30,
|
|
December 31,
|
||||
|
|
2016
|
|
2015
|
||||
Current restricted cash
|
|
|
|
|
||||
Liquefaction Project
|
|
$
|
263,114
|
|
|
$
|
189,260
|
|
|
|
June 30,
|
|
December 31,
|
||||
|
|
2016
|
|
2015
|
||||
Trade receivable
|
|
$
|
67,266
|
|
|
$
|
—
|
|
Interest receivable
|
|
59
|
|
|
7
|
|
||
Other accounts receivable
|
|
3,986
|
|
|
570
|
|
||
Total accounts and other receivables
|
|
$
|
71,311
|
|
|
$
|
577
|
|
|
|
June 30,
|
|
December 31,
|
||||
|
|
2016
|
|
2015
|
||||
Natural gas
|
|
$
|
5,338
|
|
|
$
|
5,724
|
|
LNG
|
|
19,245
|
|
|
—
|
|
||
Materials and other
|
|
17,419
|
|
|
18
|
|
||
Total inventory
|
|
$
|
42,002
|
|
|
$
|
5,742
|
|
|
|
June 30,
|
|
December 31,
|
||||
|
|
2016
|
|
2015
|
||||
LNG terminal costs
|
|
|
|
|
||||
LNG terminal
|
|
$
|
2,737,544
|
|
|
$
|
42,220
|
|
LNG terminal construction-in-process
|
|
8,175,651
|
|
|
9,795,309
|
|
||
Accumulated depreciation
|
|
(8,962
|
)
|
|
(789
|
)
|
||
Total LNG terminal costs, net
|
|
10,904,233
|
|
|
9,836,740
|
|
||
Fixed assets
|
|
|
|
|
|
|
||
Furniture and fixtures
|
|
1,446
|
|
|
1,154
|
|
||
Computer software
|
|
4,104
|
|
|
3,782
|
|
||
Machinery and equipment
|
|
371
|
|
|
339
|
|
||
Vehicles
|
|
2,069
|
|
|
1,405
|
|
||
Other
|
|
714
|
|
|
390
|
|
||
Accumulated depreciation
|
|
(3,381
|
)
|
|
(2,403
|
)
|
||
Total fixed assets, net
|
|
5,323
|
|
|
4,667
|
|
||
Property, plant and equipment, net
|
|
$
|
10,909,556
|
|
|
$
|
9,841,407
|
|
•
|
interest rate swaps to hedge the exposure to volatility in a portion of the floating-rate interest payments under one of our credit facilities
(“Interest Rate Derivatives”)
;
|
•
|
commodity derivatives consisting of natural gas purchase agreements for the commissioning and operation of the
Liquefaction Project
(“Physical Liquefaction Supply Derivatives”)
and associated economic hedges
(“Financial Liquefaction Supply Derivatives”, and collectively with the Physical Liquefaction Supply Derivatives, the “Liquefaction Supply Derivatives”)
; and
|
•
|
commodity derivatives to hedge the exposure to price risk attributable to future sales of our LNG inventory
(“Natural Gas Derivatives”)
.
|
|
Fair Value Measurements as of
|
||||||||||||||||||||||||||||||
|
June 30, 2016
|
|
December 31, 2015
|
||||||||||||||||||||||||||||
|
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
|
||||||||||||||||
Interest Rate Derivatives liability
|
$
|
—
|
|
|
$
|
(20,666
|
)
|
|
$
|
—
|
|
|
$
|
(20,666
|
)
|
|
$
|
—
|
|
|
$
|
(8,740
|
)
|
|
$
|
—
|
|
|
$
|
(8,740
|
)
|
Liquefaction Supply Derivatives asset (liability)
|
(2,850
|
)
|
|
381
|
|
|
22,434
|
|
|
19,965
|
|
|
—
|
|
|
(25
|
)
|
|
32,492
|
|
|
32,467
|
|
||||||||
Natural Gas Derivatives asset
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
29
|
|
|
—
|
|
|
29
|
|
|
|
Net Fair Value Asset
(in thousands)
|
|
Valuation Technique
|
|
Significant Unobservable Input
|
|
Significant Unobservable Inputs Range
|
Physical Liquefaction Supply Derivatives
|
|
$22,434
|
|
Income Approach
|
|
Basis Spread
|
|
$(0.35) - $(0.02)
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Balance, beginning of period
|
|
$
|
30,054
|
|
|
$
|
342
|
|
|
$
|
32,492
|
|
|
$
|
342
|
|
Realized and mark-to-market losses:
|
|
|
|
|
|
|
|
|
||||||||
Included in cost of sales (1)
|
|
(7,855
|
)
|
|
27
|
|
|
(10,204
|
)
|
|
27
|
|
||||
Purchases and settlements:
|
|
|
|
|
|
|
|
|
||||||||
Purchases
|
|
(16
|
)
|
|
71
|
|
|
31
|
|
|
71
|
|
||||
Settlements (1)
|
|
(71
|
)
|
|
—
|
|
|
(128
|
)
|
|
—
|
|
||||
Transfers out of Level 3 (2)
|
|
322
|
|
|
—
|
|
|
243
|
|
|
—
|
|
||||
Balance, end of period
|
|
$
|
22,434
|
|
|
$
|
440
|
|
|
$
|
22,434
|
|
|
$
|
440
|
|
Change in unrealized gains relating to instruments still held at end of period
|
|
$
|
(7,795
|
)
|
|
$
|
27
|
|
|
$
|
(9,484
|
)
|
|
$
|
27
|
|
|
(1)
|
Does not include the decrease in fair value of
$0.1 million
and
$0.7 million
related to the realized gains capitalized during the
three and six months ended June 30, 2016
, respectively.
|
(2)
|
Transferred to Level 2 as a result of observable market for the underlying natural gas purchase agreements.
|
|
|
Initial Notional Amount
|
|
Maximum Notional Amount
|
|
Effective Date
|
|
Maturity Date
|
|
Weighted Average Fixed Interest Rate Paid
|
|
Variable Interest Rate Received
|
Interest Rate Derivatives
|
|
$20.0 million
|
|
$628.8 million
|
|
August 14, 2012
|
|
July 31, 2019
|
|
1.98%
|
|
One-month LIBOR
|
|
|
|
|
Fair Value Measurements as of
|
||||||
|
|
Balance Sheet Location
|
|
June 30, 2016
|
|
December 31, 2015
|
||||
Interest Rate Derivatives
|
|
Derivative liabilities
|
|
$
|
(7,340
|
)
|
|
$
|
(5,940
|
)
|
Interest Rate Derivatives
|
|
Non-current derivative liabilities
|
|
(13,326
|
)
|
|
(2,800
|
)
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Interest Rate Derivatives gain (loss)
|
|
$
|
(4,752
|
)
|
|
$
|
1,469
|
|
|
$
|
(16,030
|
)
|
|
$
|
(35,669
|
)
|
|
|
June 30, 2016
|
|
December 31, 2015
|
||||||||||||||||||||
|
|
Liquefaction Supply Derivatives (1)
|
|
Natural Gas Derivatives
|
|
Total
|
|
Liquefaction Supply Derivatives
|
|
Natural Gas Derivatives (2)
|
|
Total
|
||||||||||||
Balance Sheet Location
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Other current assets
|
|
$
|
2,526
|
|
|
$
|
—
|
|
|
$
|
2,526
|
|
|
$
|
2,737
|
|
|
$
|
29
|
|
|
$
|
2,766
|
|
Non-current derivative assets
|
|
20,472
|
|
|
—
|
|
|
20,472
|
|
|
30,304
|
|
|
—
|
|
|
30,304
|
|
||||||
Total derivative assets
|
|
22,998
|
|
|
—
|
|
|
22,998
|
|
|
33,041
|
|
|
29
|
|
|
33,070
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Derivative liabilities
|
|
(3,033
|
)
|
|
—
|
|
|
(3,033
|
)
|
|
(490
|
)
|
|
—
|
|
|
(490
|
)
|
||||||
Non-current derivative liabilities
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(84
|
)
|
|
—
|
|
|
(84
|
)
|
||||||
Total derivative liabilities
|
|
(3,033
|
)
|
|
—
|
|
|
(3,033
|
)
|
|
(574
|
)
|
|
—
|
|
|
(574
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Derivative asset, net
|
|
$
|
19,965
|
|
|
$
|
—
|
|
|
$
|
19,965
|
|
|
$
|
32,467
|
|
|
$
|
29
|
|
|
$
|
32,496
|
|
|
(1)
|
Does not include collateral of
$0.5 million
deposited for such contracts, which is included in
other current assets
in our Balance Sheet as of
June 30, 2016
.
|
(2)
|
Does not include collateral of
$0.4 million
deposited for such contracts, which is included in
other current assets
in our Balance Sheet as of
December 31, 2015
.
|
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
Statement of Operations Location
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Liquefaction Supply Derivatives loss
|
LNG revenues
|
|
$
|
(34
|
)
|
|
$
|
—
|
|
|
$
|
(6
|
)
|
|
$
|
—
|
|
Liquefaction Supply Derivatives gain (loss) (1)
|
Cost (cost recovery) of sales
|
|
(8,670
|
)
|
|
81
|
|
|
(12,264
|
)
|
|
81
|
|
||||
Natural Gas Derivatives gain (loss)
|
Operating and maintenance expense
|
|
—
|
|
|
(255
|
)
|
|
150
|
|
|
444
|
|
|
|
|
Gross Amounts Recognized
|
|
Gross Amounts Offset in the Balance Sheets
|
|
Net Amounts Presented in the Balance Sheets
|
||||||
Offsetting Derivative Assets (Liabilities)
|
|
|
|
|||||||||
As of June 30, 2016
|
|
|
|
|
|
|
||||||
Interest Rate Derivatives
|
|
$
|
(20,666
|
)
|
|
$
|
—
|
|
|
$
|
(20,666
|
)
|
Liquefaction Supply Derivatives
|
|
23,165
|
|
|
(167
|
)
|
|
22,998
|
|
|||
Liquefaction Supply Derivatives
|
|
(4,505
|
)
|
|
1,472
|
|
|
(3,033
|
)
|
|||
As of December 31, 2015
|
|
|
|
|
|
|
||||||
Interest Rate Derivatives
|
|
$
|
(8,740
|
)
|
|
$
|
—
|
|
|
$
|
(8,740
|
)
|
Liquefaction Supply Derivatives
|
|
33,636
|
|
|
(595
|
)
|
|
33,041
|
|
|||
Liquefaction Supply Derivatives
|
|
(574
|
)
|
|
—
|
|
|
(574
|
)
|
|||
Natural Gas Derivatives
|
|
152
|
|
|
(123
|
)
|
|
29
|
|
|
|
June 30,
|
|
December 31,
|
||||
|
|
2016
|
|
2015
|
||||
Advances made under EPC and non-EPC contracts
|
|
$
|
14,000
|
|
|
$
|
32,049
|
|
Advances made to municipalities for water system enhancements
|
|
95,584
|
|
|
89,953
|
|
||
Tax-related payments and receivables
|
|
1,218
|
|
|
5,535
|
|
||
Information technology service assets
|
|
23,766
|
|
|
24,166
|
|
||
Other
|
|
46,081
|
|
|
43,115
|
|
||
Total other non-current assets
|
|
$
|
180,649
|
|
|
$
|
194,818
|
|
|
|
June 30,
|
|
December 31,
|
||||
|
|
2016
|
|
2015
|
||||
Interest costs and related debt fees
|
|
$
|
139,356
|
|
|
$
|
135,336
|
|
Liquefaction Project costs
|
|
174,297
|
|
|
66,223
|
|
||
Other accrued liabilities
|
|
3
|
|
|
—
|
|
||
Total accrued liabilities
|
|
$
|
313,656
|
|
|
$
|
201,559
|
|
|
|
June 30,
|
|
December 31,
|
||||
|
|
2016
|
|
2015
|
||||
Long-term debt
|
|
|
|
|
||||
5.625% Senior Secured Notes due 2021 (“2021 Senior Notes”), net of unamortized premium of $7,959 and $8,718
|
|
$
|
2,007,959
|
|
|
$
|
2,008,718
|
|
6.25% Senior Secured Notes due 2022 (“2022 Senior Notes”)
|
|
1,000,000
|
|
|
1,000,000
|
|
||
5.625% Senior Secured Notes due 2023 (“2023 Senior Notes”), net of unamortized premium of $6,029 and $6,392
|
|
1,506,029
|
|
|
1,506,392
|
|
||
5.75% Senior Secured Notes due 2024 (“2024 Senior Notes”)
|
|
2,000,000
|
|
|
2,000,000
|
|
||
5.625% Senior Secured Notes due 2025 (“2025 Senior Notes”)
|
|
2,000,000
|
|
|
2,000,000
|
|
||
5.875% Senior Secured Notes due 2026 (“2026 Senior Notes”)
|
|
1,500,000
|
|
|
—
|
|
||
2015 Credit Facilities
|
|
832,695
|
|
|
845,000
|
|
||
Unamortized debt issuance costs (1)
|
|
(168,138
|
)
|
|
(154,551
|
)
|
||
Total long-term debt, net
|
|
10,678,545
|
|
|
9,205,559
|
|
||
|
|
|
|
|
||||
Current debt
|
|
|
|
|
||||
$1.2 billion Working Capital Facility (“Working Capital Facility”)
|
|
—
|
|
|
15,000
|
|
||
Total debt, net
|
|
$
|
10,678,545
|
|
|
$
|
9,220,559
|
|
|
(1)
|
Effective January 1, 2016, we adopted ASU 2015-03 and ASU 2015-15, which require debt issuance costs related to term notes to be presented in the balance sheet as a direct deduction from the debt liability, rather than as an asset, retrospectively for each reporting period presented. As a result, we reclassified
$154.6 million
from debt issuance costs, net to long-term debt, net as of
December 31, 2015
.
|
|
|
2015 Credit Facilities
|
|
Working Capital Facility
|
||||
Original facility size
|
|
$
|
4,600,000
|
|
|
$
|
1,200,000
|
|
Outstanding balance
|
|
832,695
|
|
|
—
|
|
||
Commitments terminated
|
|
1,287,305
|
|
|
—
|
|
||
Letters of credit issued
|
|
—
|
|
|
237,270
|
|
||
Available commitment
|
|
$
|
2,480,000
|
|
|
$
|
962,730
|
|
|
|
|
|
|
||||
Interest rate
|
|
LIBOR plus 1.30% - 1.75% or base rate plus 1.75%
|
|
LIBOR plus 1.75% or base rate plus 0.75%
|
||||
Maturity date
|
|
Earlier of December 31, 2020 or second anniversary of Trains 1 through 5 completion date
|
|
December 31, 2020, with various terms for underlying loans
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Total interest cost
|
|
$
|
152,948
|
|
|
$
|
130,786
|
|
|
$
|
300,171
|
|
|
$
|
246,895
|
|
Capitalized interest
|
|
(125,690
|
)
|
|
(117,871
|
)
|
|
(266,907
|
)
|
|
(227,586
|
)
|
||||
Total interest expense, net
|
|
$
|
27,258
|
|
|
$
|
12,915
|
|
|
$
|
33,264
|
|
|
$
|
19,309
|
|
|
|
June 30, 2016
|
|
December 31, 2015
|
||||||||||||
|
|
Carrying
Amount
|
|
Estimated
Fair Value
|
|
Carrying
Amount
|
|
Estimated
Fair Value
|
||||||||
Senior Notes, net of premium (1)
|
|
$
|
10,013,988
|
|
|
$
|
10,032,769
|
|
|
$
|
8,515,110
|
|
|
$
|
7,469,718
|
|
Credit facilities (2)
|
|
832,695
|
|
|
832,695
|
|
|
860,000
|
|
|
860,000
|
|
|
(1)
|
Includes
2021 Senior Notes
, net of premium;
2022 Senior Notes
;
2023 Senior Notes
, net of premium;
2024 Senior Notes
;
2025 Senior Notes
and
2026 Senior Notes
(collectively, the “Senior Notes”)
. The Level 2 estimated fair value was based on quotes obtained from broker-dealers or market makers of the Senior Notes and other similar instruments.
|
(2)
|
Includes
2015 Credit Facilities
and
Working Capital Facility
. The Level 3 estimated fair value approximates the principal amount because the interest rates are variable and reflective of market rates and the debt may be repaid, in full or in part, at any time without penalty.
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
|||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|||||||||
Cost of sales—affiliate
|
||||||||||||||||
Cargo loading fees under the Terminal Use Rights Assignment and Agreement (the “TURA”)
|
$
|
645
|
|
|
$
|
—
|
|
|
$
|
645
|
|
|
$
|
—
|
|
|
|
||||||||||||||||
Operating and maintenance expense—affiliate
|
||||||||||||||||
TUA
|
10,242
|
|
|
—
|
|
|
10,242
|
|
|
—
|
|
|||||
Natural Gas Transportation Agreement
|
7,508
|
|
|
—
|
|
|
7,508
|
|
|
—
|
|
|||||
Services Agreements
|
3,646
|
|
|
78
|
|
|
4,425
|
|
|
128
|
|
|||||
LNG Site Sublease Agreement
|
122
|
|
|
—
|
|
|
357
|
|
|
—
|
|
|||||
Total operating and maintenance expense—affiliate
|
21,518
|
|
|
78
|
|
|
22,532
|
|
|
128
|
|
|||||
|
||||||||||||||||
Terminal use agreement maintenance expense—affiliate
|
||||||||||||||||
TUA
|
—
|
|
|
143
|
|
|
208
|
|
|
178
|
|
|||||
|
||||||||||||||||
Development expense—affiliate
|
||||||||||||||||
Services Agreements
|
153
|
|
|
206
|
|
|
282
|
|
|
410
|
|
|||||
LNG Site Sublease Agreement
|
115
|
|
|
—
|
|
|
115
|
|
|
—
|
|
|||||
Total development expense—affiliate
|
268
|
|
|
206
|
|
|
397
|
|
|
410
|
|
|||||
|
||||||||||||||||
General and administrative expense—affiliate
|
||||||||||||||||
Services Agreements
|
15,825
|
|
|
24,663
|
|
|
32,880
|
|
|
39,110
|
|
|||||
LNG Site Sublease Agreement
|
—
|
|
|
121
|
|
|
—
|
|
|
241
|
|
|||||
Other agreements
|
—
|
|
|
7
|
|
|
—
|
|
|
15
|
|
|||||
Total general and administrative expense—affiliate
|
15,825
|
|
|
24,791
|
|
|
32,880
|
|
|
39,366
|
|
|
|
Six Months Ended June 30,
|
||||||
|
|
2016
|
|
2015
|
||||
Cash paid during the period for interest, net of amounts capitalized
|
|
$
|
24,846
|
|
|
$
|
—
|
|
Non-cash distributions to affiliates for conveyance of assets
|
|
252,802
|
|
|
80,515
|
|
Standard
|
|
Description
|
|
Expected Date of Adoption
|
|
Effect on our Financial Statements or Other Significant Matters
|
ASU 2014-09,
Revenue from Contracts with Customers (Topic 606)
, and subsequent amendments thereto
|
|
This standard amends existing revenue recognition guidance and requires an entity to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This guidance may be early adopted beginning January 1, 2017, and may be adopted either retrospectively to each prior reporting period presented or as a cumulative-effect adjustment as of the date of adoption.
|
|
January 1, 2018
|
|
We are currently evaluating the impact of the provisions of this guidance on our Financial Statements and related disclosures.
|
ASU 2014-15,
Presentation of Financial Statements-Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern
|
|
This standard requires an entity’s management to evaluate, for each reporting period, whether there are conditions and events that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the financial statements are issued. Additional disclosures are required if management concludes that conditions or events raise substantial doubt about the entity’s ability to continue as a going concern. Early adoption is permitted.
|
|
December 31, 2016
|
|
The adoption of this guidance is not expected to have an impact on our Financial Statements or related disclosures.
|
ASU 2015-11,
Inventory (Topic 330): Simplifying the Measurement of Inventory
|
|
This standard requires inventory to be measured at the lower of cost and net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. This guidance may be early adopted and must be adopted prospectively.
|
|
January 1, 2017
|
|
We are currently evaluating the impact of the provisions of this guidance on our Financial Statements and related disclosures.
|
ASU 2016-02,
Leases (Topic 842)
|
|
This standard requires a lessee to recognize leases on its balance sheet by recording a liability representing the obligation to make future lease payments and a right-of-use asset representing the right to use the underlying asset for the lease term. A lessee is permitted to make an election not to recognize lease assets and liabilities for leases with a term of 12 months or less. The standard also modifies the definition of a lease and requires expanded disclosures. This guidance may be early adopted, and must be adopted using a modified retrospective approach with certain available practical expedients.
|
|
January 1, 2019
|
|
We are currently evaluating the impact of the provisions of this guidance on our Financial Statements and related disclosures.
|
Standard
|
|
Description
|
|
Date of Adoption
|
|
Effect on our Financial Statements or Other Significant Matters
|
ASU 2015-03,
Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs
and ASU 2015-15,
Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements
|
|
These standards require debt issuance costs related to a recognized debt liability to be presented in the balance sheet as a direct deduction from the debt liability rather than as an asset. Debt issuance costs incurred in connection with line of credit arrangements may be presented as an asset and subsequently amortized ratably over the term of the line of credit arrangement. This guidance may be early adopted, and must be adopted retrospectively to each prior reporting period presented.
|
|
January 1, 2016
|
|
Upon adoption of these standards, the balance of debt, net was reduced by the balance of debt issuance costs, net, except for the balance related to line of credit arrangements, on our Balance Sheets. See
Note 9—Debt
for additional disclosures.
|
ITEM 2.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
•
|
statements that we expect to commence or complete construction of our natural gas liquefaction project, or any expansions or portions thereof, by certain dates, or at all;
|
•
|
s
tatements regarding future levels of domestic and international natural gas production, supply or consumption or future levels of LNG exports from North America and other countries worldwide or purchases of natural gas, regardless of the source of such information, or the transportation or other infrastructure 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 Trains, including statements concerning the engagement of any 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 SPA or any other 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 natural gas 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 development and 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, approvals, requirements, permits, applications, filings, investigations, proceedings or decisions; 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 Estimates
|
•
|
Recent Accounting Standards
|
•
|
In February 2016, we commenced production and shipment of LNG commissioning cargoes from Train 1 of the
Liquefaction Project
.
|
•
|
In May 2016, Jack Fusco was appointed as our Chief Executive Officer, effective as of May 12, 2016.
|
•
|
In May 2016, Train 1 of the
Liquefaction Project
achieved substantial completion and initiated operating activities.
|
•
|
In June 2016, we issued an aggregate principal amount of $1.5 billion of 5.875% Senior Secured Notes due 2026
(the “2026 Senior Notes”)
. Net proceeds of the offering of approximately $1.3 billion, after deducting commissions, fees and expenses and incremental interest required under the
2026 SPL Senior Notes
during construction, were used to prepay a portion of the outstanding borrowings under the credit facilities we entered into in June 2015
(the “2015 Credit Facilities”)
.
|
•
|
$2.0 billion
of 5.625% Senior Secured Notes due 2021
(the “2021 Senior Notes”)
;
|
•
|
$1.0 billion
of 6.25% Senior Secured Notes due 2022
(the “2022 Senior Notes”)
;
|
•
|
$1.5 billion
of 5.625% Senior Secured Notes due 2023
(the “2023 Senior Notes”)
;
|
•
|
$2.0 billion
of 5.75% Senior Secured Notes due 2024
(the “2024 Senior Notes”)
;
|
•
|
$2.0 billion
of 5.625% Senior Secured Notes due 2025
(the “2025 Senior Notes” and collectively with the 2021 Senior Notes, the 2022 Senior Notes, the 2023 Senior Notes, the 2024 Senior Notes and the 2026 Senior Notes, the “Senior Notes”)
; and
|
•
|
$1.5 billion
of
2026 Senior Notes
.
|
|
Six Months Ended June 30,
|
||||||
|
2016
|
|
2015
|
||||
Operating cash flows
|
|
|
|
||||
Net cash provided by (used in) operating activities
|
$
|
—
|
|
|
$
|
—
|
|
Changes in restricted cash for certain operating activities
|
(129,767
|
)
|
|
(37,976
|
)
|
||
Cash, cash equivalents and restricted cash used in operating activities
|
(129,767
|
)
|
|
(37,976
|
)
|
||
|
|
|
|
||||
Investing cash flows
|
|
|
|
||||
Net cash provided by (used in) investing activities
|
—
|
|
|
—
|
|
||
Use of restricted cash for the acquisition of property, plant and equipment
|
(1,248,877
|
)
|
|
(1,448,523
|
)
|
||
Cash, cash equivalents and restricted cash used in investing activities
|
(1,248,877
|
)
|
|
(1,448,523
|
)
|
||
|
|
|
|
||||
Financing cash flows
|
|
|
|
||||
Net cash provided by (used in) financing activities
|
—
|
|
|
—
|
|
||
Investment in restricted cash
|
1,452,498
|
|
|
1,870,151
|
|
||
Cash, cash equivalents and restricted cash used in financing activities
|
1,452,498
|
|
|
1,870,151
|
|
||
|
|
|
|
||||
Net increase in cash, cash equivalents and restricted cash
|
73,854
|
|
|
383,652
|
|
||
Cash, cash equivalents and restricted cash—beginning of period
|
189,260
|
|
|
612,863
|
|
||
Cash, cash equivalents and restricted cash—end of period
|
$
|
263,114
|
|
|
$
|
996,515
|
|
•
|
$1.3 billion of borrowings under the
2015 Credit Facilities
;
|
•
|
issuance of an aggregate principal amount of $1.5 billion of the
2026 Senior Notes
in June 2016, which was used to prepay $1.3 billion of the outstanding borrowings under the
2015 Credit Facilities
;
|
•
|
$140.0 million borrowings, net of $155.0 million repayment, made under the
Working Capital Facility
;
|
•
|
$21.4 million
of debt issuance and deferred financing costs related to up-front fees paid upon the closing of these transactions; and
|
•
|
$1.3 million
of equity contributions from Cheniere Partners, which decreased compared to the contributions received in the
six months ended June 30, 2015
, as a result of utilizing our borrowings instead of equity contributions from Cheniere Partners to finance our capital resource requirements.
|
•
|
issuance of an aggregate principal amount of $2.0 billion of the
2025 Senior Notes
in March 2015;
|
•
|
entering into the
2015 Credit Facilities
aggregating $4.6 billion in June 2015, which terminated and replaced the 2013 Credit Facilities;
|
•
|
$145.0 million
of debt issuance and deferred financing costs related to up-front fees paid upon the closing of these transactions; and
|
•
|
$15.1 million
of equity contributions from Cheniere Partners.
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||||||||||
(Dollars in thousands)
|
2016
|
|
2015
|
|
Change
|
|
2016
|
|
2015
|
|
Change
|
||||||||||||
LNG revenues
|
$
|
85,326
|
|
|
$
|
—
|
|
|
$
|
85,326
|
|
|
$
|
85,354
|
|
|
$
|
—
|
|
|
$
|
85,354
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||||||||||
(Dollars in thousands)
|
2016
|
|
2015
|
|
Change
|
|
2016
|
|
2015
|
|
Change
|
||||||||||||
Cost (cost recovery) of sales
|
$
|
52,226
|
|
|
$
|
(70
|
)
|
|
$
|
52,296
|
|
|
$
|
55,914
|
|
|
$
|
(70
|
)
|
|
$
|
55,984
|
|
Cost of sales—affiliate
|
645
|
|
|
—
|
|
|
645
|
|
|
645
|
|
|
—
|
|
|
645
|
|
||||||
Operating and maintenance expense
|
11,637
|
|
|
1,322
|
|
|
10,315
|
|
|
16,072
|
|
|
3,032
|
|
|
13,040
|
|
||||||
Operating and maintenance expense—affiliate
|
21,518
|
|
|
78
|
|
|
21,440
|
|
|
22,532
|
|
|
128
|
|
|
22,404
|
|
||||||
Terminal use agreement maintenance expense (recovery)
|
(675
|
)
|
|
(279
|
)
|
|
(396
|
)
|
|
(618
|
)
|
|
17,521
|
|
|
(18,139
|
)
|
||||||
Terminal use agreement maintenance expense—affiliate
|
—
|
|
|
143
|
|
|
(143
|
)
|
|
208
|
|
|
178
|
|
|
30
|
|
||||||
Development expense
|
70
|
|
|
1,367
|
|
|
(1,297
|
)
|
|
136
|
|
|
2,518
|
|
|
(2,382
|
)
|
||||||
Development expense—affiliate
|
268
|
|
|
206
|
|
|
62
|
|
|
397
|
|
|
410
|
|
|
(13
|
)
|
||||||
General and administrative expense
|
2,357
|
|
|
1,562
|
|
|
795
|
|
|
3,656
|
|
|
2,720
|
|
|
936
|
|
||||||
General and administrative expense—affiliate
|
15,825
|
|
|
24,791
|
|
|
(8,966
|
)
|
|
32,880
|
|
|
39,366
|
|
|
(6,486
|
)
|
||||||
Depreciation and amortization expense
|
9,976
|
|
|
412
|
|
|
9,564
|
|
|
12,114
|
|
|
818
|
|
|
11,296
|
|
||||||
Total operating costs and expenses
|
$
|
113,847
|
|
|
$
|
29,532
|
|
|
$
|
84,315
|
|
|
$
|
143,936
|
|
|
$
|
66,621
|
|
|
$
|
77,315
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||||||||||
(Dollars in thousands)
|
2016
|
|
2015
|
|
Change
|
|
2016
|
|
2015
|
|
Change
|
||||||||||||
Interest expense, net of capitalized interest
|
$
|
27,258
|
|
|
$
|
12,915
|
|
|
$
|
14,343
|
|
|
$
|
33,264
|
|
|
$
|
19,309
|
|
|
$
|
13,955
|
|
Loss on early extinguishment of debt
|
26,305
|
|
|
7,281
|
|
|
19,024
|
|
|
26,305
|
|
|
96,273
|
|
|
(69,968
|
)
|
||||||
Derivative loss (gain), net
|
4,752
|
|
|
(1,469
|
)
|
|
6,221
|
|
|
16,030
|
|
|
35,669
|
|
|
(19,639
|
)
|
||||||
Other income
|
(146
|
)
|
|
(158
|
)
|
|
12
|
|
|
(250
|
)
|
|
(222
|
)
|
|
(28
|
)
|
||||||
Total other expense
|
$
|
58,169
|
|
|
$
|
18,569
|
|
|
$
|
39,600
|
|
|
$
|
75,349
|
|
|
$
|
151,029
|
|
|
$
|
(75,680
|
)
|
ITEM 3.
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
ITEM 4.
|
CONTROLS AND PROCEDURES
|
PART II.
|
OTHER INFORMATION
|
ITEM 1.
|
LEGAL PROCEEDINGS
|
ITEM 1A.
|
RISK FACTORS
|
ITEM 5.
|
OTHER INFORMATION
|
ITEM 6.
|
EXHIBITS
|
Exhibit No.
|
|
Description
|
4.1
|
|
Seventh Supplemental Indenture, dated as of June 14, 2016, between Sabine Pass Liquefaction, LLC and The Bank of New York Mellon, as Trustee under the Indenture (Incorporated by reference to Exhibit 4.1 to Cheniere Partners’ Current Report on Form 8-K (SEC File No. 001-33366), filed on June 14, 2016)
|
10.1
|
|
Registration Rights Agreement, dated as of June 14, 2016, between Sabine Pass Liquefaction, LLC and Credit Suisse Securities (USA) LLC (Incorporated by reference to Exhibit 10.1 to Cheniere Partners’ Current Report on Form 8-K (SEC File No. 001-33366), filed on June 14, 2016)
|
10.2*
|
|
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-00045 April Site Closure for Cheniere Celebration, dated April 4, 2016, (ii) the Change Order CO-00046 Defer Completion of Ship Loading Time Commissioning Test, dated May 17, 2016, and (iii) the Change Order CO-00047 Re-Orientation of PSV Bypass Valves, dated May 25, 2016
|
10.3*
|
|
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-00021 Smokeless Flare Modification Study, dated March 29, 2016, (ii) the Change Order CO-00022 Cable Tray Support and Arc Flash Study, dated May 4, 2016, and (iii) the Change Order CO-00023 Re-Orientation of PSV Bypass Valves, dated May 17, 2016
|
10.4*
|
|
Change orders to the Lump Sum Turnkey Agreement for the Engineering, Procurement and Construction of the Sabine Pass LNG Stage 3 Liquefaction Facility, dated as of May 4, 2015, between Sabine Pass Liquefaction, LLC and Bechtel Oil, Gas and Chemicals, Inc.: (i) the Change Order CO-00005 Performance and Attendance Bonus (PAB) Incentive Program Provisional Sum, dated March 16, 2016, (ii) the Change Order CO-00006 Additional Bechtel Hours to Support RECON, Temporary Access Rd., Addition of Flash Liquid Expander, Removal of Vibration Monitor System, To-Date Reconciliation of Soils Preparation Provisional Sum, dated March 22, 2016, (iii) the Change Order CO-00007 Additional Support for FERC Document Requests, dated May 10, 2016, (iv) the Change Order CO-00008 Water System Scope Changes and Seal Design & Seal Gas Modification, dated May 4, 2016, (v) the Change Order CO-00009 Re-Orientation of PSV Bypass Valves, dated May 17, 2016, and (vi) the Change Order CO-00010 Deletion of Chlorine Analyzer, dated June 15, 2016 (Portions of this exhibit have been omitted and filed separately with the SEC pursuant to a request for confidential treatment.)
|
31.1*
|
|
Certification by Chief Executive Officer required by Rule 13a-14(a) and 15d-14(a) under the Exchange Act
|
31.2*
|
|
Certification by Chief Financial Officer required by Rule 13a-14(a) and 15d-14(a) under the Exchange Act
|
32.1**
|
|
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
|
32.2**
|
|
Certification by Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
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.
|
|
|
SABINE PASS LIQUEFACTION, LLC
|
|
|
|
|
|
Date:
|
August 8, 2016
|
By:
|
/s/ Michael J. Wortley
|
|
|
|
Michael J. Wortley
|
|
|
|
Chief Financial Officer
|
|
|
|
(on behalf of the registrant and
as principal financial officer) |
|
|
|
|
Date:
|
August 8, 2016
|
By:
|
/s/ Leonard Travis
|
|
|
|
Leonard Travis
|
|
|
|
Chief Accounting Officer
|
|
|
|
(on behalf of the registrant and
as principal accounting officer) |
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-00045
DATE OF CHANGE ORDER: April 4, 2016
|
1.
|
Parties agree Bechtel will temporarily close SPL Site on April 25, 2016 in observance of Sabine Pass LNG Opening Celebration Day. No construction activities on Site will be performed on this day.
|
2.
|
The overall cost breakdown is detailed in Exhibit A.
|
3.
|
Schedule C-1 (Milestone Payment Schedule) of Attachment C of the Agreement will be amended by including the milestone(s) listed in Exhibit B of this Change Order.
|
The original Contract Price was
|
$
|
3,900,000,000
|
|
Net change by previously authorized Change Orders (#0001-00044)
|
$
|
215,447,859
|
|
The Contract Price prior to this Change Order was
|
$
|
4,115,447,859
|
|
The Contract Price will be (increased) by this Change Order in the amount of
|
$
|
1,325,996
|
|
The new Contract Price including this Change Order will be
|
$
|
4,116,773,855
|
|
/s/ Ed Lehotsky
|
|
/s/ Dena Volovar
|
Owner
|
|
Contractor
|
Ed Lehotsky
|
|
Dena Volovar
|
Name
|
|
Name
|
VP LNG Projects
|
|
Project Manager
|
Title
|
|
Title
|
April 27, 2016
|
|
April 5, 2016
|
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-00046
DATE OF CHANGE ORDER: May 17, 2016
|
The original Contract Price was
|
$
|
3,900,000,000
|
|
Net change by previously authorized Change Orders (#0001-00045)
|
$
|
216,773,855
|
|
The Contract Price prior to this Change Order was
|
$
|
4,116,773,855
|
|
The Contract Price will be (increased) by this Change Order in the amount of
|
$
|
Unchanged
|
|
The new Contract Price including this Change Order will be
|
$
|
4,116,773,855
|
|
/s/ Ed Lehotsky
|
|
/s/ Sergio Buoncristiano
|
Owner
|
|
Contractor
|
Ed Lehotsky
|
|
Sergio Buoncristiano
|
Name
|
|
Name
|
SVP LNG E&C
|
|
Sr. Vice President
|
Title
|
|
Title
|
May 26, 2016
|
|
May 25, 2016
|
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-00047
DATE OF CHANGE ORDER: May 25, 2016
|
1.
|
Per Article 6.1.B of the Agreement, Parties agree Bechtel will modify the current PSV bypass valve orientation on Subproject 2 so that the cavity relief vents of the PSV bypass valves are on the high pressure side of the valves. This Change Order includes engineering hours to revise P&IDs and Isometric drawings for Subproject 1 and Subproject 2. Subproject 1 field reorientation will be performed by SPL at a future date.
|
2.
|
The following payment milestones in Attachment C of the Agreement will be amended:
|
a.
|
Payment Milestone: 55.02 Progress report or equivalent shows 90% complete of original budget quantity earned.
|
3.
|
The overall cost breakdown for this Change Order is detailed in Exhibit A.
|
4.
|
Schedule C-1 (Milestone Payment Schedule) of Attachment C of the Agreement will be amended by including the milestone(s) listed in Exhibit B of this Change Order.
|
The original Contract Price was
|
$
|
3,900,000,000
|
|
Net change by previously authorized Change Orders (#0001-00046)
|
$
|
216,773,855
|
|
The Contract Price prior to this Change Order was
|
$
|
4,116,773,855
|
|
The Contract Price will be (increased) by this Change Order in the amount of
|
$
|
12,824
|
|
The new Contract Price including this Change Order will be
|
$
|
4,116,786,679
|
|
/s/ Ed Lehotsky
|
|
/s/ Dena Volovar
|
Owner
|
|
Contractor
|
Ed Lehotsky
|
|
Dena Volovar
|
Name
|
|
Name
|
SVP LNG E&C
|
|
Principal Vice President
|
Title
|
|
Title
|
June 16, 2016
|
|
May 25, 2016
|
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-00021
DATE OF CHANGE ORDER: March 29, 2016
|
1.
|
Per Article 6.1.B of the Agreement, Parties agree Bechtel is to conduct a study to potentially identify a short-term and a long-term solution to mitigate smoke production in the flare systems to all wet, dry and marine flares.
|
2.
|
The study referenced above will form the estimate for the implementation of short-term and long-term flare modifications.
|
3.
|
The overall cost breakdown for this Change Order is detailed in Exhibit A.
|
4.
|
Schedule C-1 (Milestone Payment Schedule) of Attachment C of the Agreement will be amended by including the milestone(s) listed in Exhibit B of this Change Order.
|
The original Contract Price was
|
$
|
3,769,000,000
|
|
Net change by previously authorized Change Orders (#0001-00020)
|
$
|
31,299,776
|
|
The Contract Price prior to this Change Order was
|
$
|
3,800,299,776
|
|
The Contract Price will be (increased) by this Change Order in the amount of
|
$
|
660,681
|
|
The new Contract Price including this Change Order will be
|
$
|
3,800,960,457
|
|
/s/ Ed Lehotsky
|
|
/s/ Dena Volovar
|
Owner
|
|
Contractor
|
Ed Lehotsky
|
|
Dena Volovar
|
Name
|
|
Name
|
SVP LNG E&C
|
|
Project Manager
|
Title
|
|
Title
|
June 16, 2016
|
|
March 29, 2016
|
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-00022
DATE OF CHANGE ORDER: May 4, 2016
|
1.
|
Per Article 6.1.B of the Agreement, Parties agree Bechtel will design supplemental cable tray supports, including drawings, details, bill of materials and a cost estimate for the associated material and installation labor. Neither procurement of materials nor installation of the supplemental supports is included in this Change Order.
|
2.
|
Per Article 6.1.B of the Agreement, Parties agree Bechtel will conduct two (2) additional Arc Flash case studies (Tie Open and Tie Closed) for the following scenario: two (2) GTGs in service and a load combination of one (1) train, part of vaporization plant and three (3) BOG compressors.
|
3.
|
The overall cost breakdown for this Change Order is detailed in Exhibit A.
|
4.
|
Schedule C-1 (Milestone Payment Schedule) of Attachment C of the Agreement will be amended by including the milestone(s) listed in Exhibit B of this Change Order.
|
The original Contract Price was
|
$
|
3,769,000,000
|
|
Net change by previously authorized Change Orders (#0001-00021)
|
$
|
31,960,457
|
|
The Contract Price prior to this Change Order was
|
$
|
3,800,960,457
|
|
The Contract Price will be (increased) by this Change Order in the amount of
|
$
|
92,542
|
|
The new Contract Price including this Change Order will be
|
$
|
3,801,052,999
|
|
/s/ Ed Lehotsky
|
|
/s/ Dena Volovar
|
Owner
|
|
Contractor
|
Ed Lehotsky
|
|
Dena Volovar
|
Name
|
|
Name
|
SVP LNG E&C
|
|
Principal Vice President
|
Title
|
|
Title
|
May 25, 2016
|
|
May 5, 2016
|
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-00023
DATE OF CHANGE ORDER: May 17, 2016
|
1.
|
Per Article 6.1.B of the Agreement, Parties agree Bechtel will modify the current PSV bypass valve orientation on Subprojects 3 and 4 so that the cavity relief vents of the PSV bypass valves are on the high pressure side of the valves. This Change Order includes engineering hours to revise P&IDs and Isometric drawings.
|
2.
|
The cost breakdown for this Change Order is detailed in Exhibit A.
|
3.
|
Schedule C-1 (Milestone Payment Schedule) of Attachment C of the Agreement will be amended by including the milestone(s) listed in Exhibit B of this Change Order.
|
The original Contract Price was
|
$
|
3,769,000,000
|
|
Net change by previously authorized Change Orders (#0001-00022)
|
$
|
32,052,999
|
|
The Contract Price prior to this Change Order was
|
$
|
3,801,052,999
|
|
The Contract Price will be (increased) by this Change Order in the amount of
|
$
|
25,648
|
|
The new Contract Price including this Change Order will be
|
$
|
3,801,078,647
|
|
/s/ Ed Lehotsky
|
|
/s/ Dena Volovar
|
Owner
|
|
Contractor
|
Ed Lehotsky
|
|
Dena Volovar
|
Name
|
|
Name
|
SVP LNG E&C
|
|
Principal Vice President
|
Title
|
|
Title
|
June 16, 2016
|
|
May 17, 2016
|
Date of Signing
|
|
Date of Signing
|
PROJECT NAME:
Sabine Pass LNG Stage 3 Liquefaction Facility
OWNER:
Sabine Pass Liquefaction, LLC
CONTRACTOR:
Bechtel Oil, Gas and Chemicals, Inc.
DATE OF AGREEMENT: May 4, 2015
|
CHANGE ORDER NUMBER:
CO-00005
DATE OF CHANGE ORDER: March 16, 2016
|
1.
|
Parties agree Bechtel will implement a Performance and Attendance Bonus (PAB) Incentive Program to attract and retain qualified craft beginning the first regular pay period of 2016 through Substantial Completion of Subproject 5. The overall PAB Incentive Program will be comprised of two separate programs. Program 1 will apply to all SPL 3 direct-hire craft workers. Program 2 will apply to all SPL 3 core direct-hire crafts in the following classifications: electrician, instrument technician, millwright, friction operator, pipefitter, rigger, and welder. The Provisional Sum amount for Program 1 PAB and Program 2 PAB is $36.9 million. Further details regarding the PAB Incentive Programs 1 and 2 are detailed in Exhibit A of this Change Order.
|
2.
|
Bechtel will invoice SPL at the beginning of each quarter, the maximum achievable incentive amount for that quarter. Semi-annually the Parties will reconcile the previous two quarter’s invoiced amount against the total cost of the PAB Incentive Program in the same two quarters. Any variance will be included with the next applicable invoice.
|
3.
|
PAB quarterly goals will be set with the intention to achieve target schedule progress and attendance goals. PAB amounts will be paid to qualified craft members on a quarterly basis. Bechtel will pay the craft 50% of the earned PAB and retain the remaining 50% of the PAB in escrow through the duration of the employee’s work on SPL 3. Payment parameters and milestone examples are summarized in Exhibit A.
|
4.
|
Attachment EE of the Agreement is hereby amended by adding Section 2.5 Craft Incentive & Retention Program Provisional Sum.
|
The original Contract Price was
|
$
|
2,987,000,000
|
|
Net change by previously authorized Change Orders (#0001-00004)
|
$
|
(34,843,025
|
)
|
The Contract Price prior to this Change Order was
|
$
|
2,952,156,975
|
|
The Contract Price will be (increased) by this Change Order in the amount of
|
$
|
36,900,000
|
|
The new Contract Price including this Change Order will be
|
$
|
2,989,056,975
|
|
/s/ Ed Lehotsky
|
|
/s/ Dena Volovar
|
Owner
|
|
Contractor
|
Ed Lehotsky
|
|
Dena Volovar
|
Name
|
|
Name
|
VP LNG Projects
|
|
Project Manager
|
Title
|
|
Title
|
April 19, 2016
|
|
March 16, 2016
|
Date of Signing
|
|
Date of Signing
|
PROJECT NAME:
Sabine Pass LNG Stage 3 Liquefaction Facility
OWNER:
Sabine Pass Liquefaction, LLC
CONTRACTOR:
Bechtel Oil, Gas and Chemicals, Inc.
DATE OF AGREEMENT: May 4, 2015
|
CHANGE ORDER NUMBER:
CO-00006
DATE OF CHANGE ORDER: March 22, 2016
|
1.
|
Per Article 6.1.B of the Agreement, Parties agree Bechtel will be compensated for additional hours to support SPL-directed changes to the soil stabilization subcontractor’s (RECON) work.
|
2.
|
Per Article 6.1.B of the Agreement, Parties agree Bechtel will construct a temporary road to enable access for the piling subcontractor to the Train 5 and surrounding areas. The location of this change is depicted in Exhibit A of this Change Order.
|
3.
|
Per Article 6.1.B of the Agreement, Parties agree Bechtel will engineer and design for the addition of a Flash Liquid Expander (FLE). Scope includes the piles and connections/penetrations in the Methane Cold Box. The location of the FLE is depicted in Exhibit B of this Change Order.
|
4.
|
Per Article 6.1.B of the Agreement, Parties agree Bechtel will remove the Vibration Monitor System scope, various workstations, consoles, and printers from the SPL 3 scope.
|
a.
|
The Existing & Stages 1 and 2 Liquefaction Facility Labor Provisional Sum value was *** U.S. Dollars (U.S. $***) and *** (***) hours. These values will be amended and the new values shall be *** U.S. Dollars (U.S. $***) and *** (***) hours.
|
5.
|
Per Article 6.1.B of the Agreement, Parties agree Bechtel will reconcile the Soils Preparation Provisional Sum for deductions for SPL scope and drawing revisions.
|
a.
|
The previous Soils Preparation Provisional Sum was *** U.S. Dollars (U.S. $***). This value will be amended and the new value shall be *** U.S. Dollars (U.S. $***).
|
6.
|
The Aggregate Provisional Sum specified in Article 7.1A of the Agreement prior to this Change Order was $305,990,060. This value will be reduced by $5,498,381 and the new value shall be $300,491,679.
|
7.
|
The cost breakdown for these scopes of work are detailed in Exhibit C of this Change Order.
|
8.
|
Schedule C-1 (Milestone Payment Schedule) of Attachment C of the Agreement will be amended by including the milestone(s) listed in Exhibit D of this Change Order.
|
The original Contract Price was
|
$
|
2,987,000,000
|
|
Net change by previously authorized Change Orders (#0001-00005)
|
$
|
2,056,975
|
|
The Contract Price prior to this Change Order was
|
$
|
2,989,056,975
|
|
The Contract Price will be (increased) by this Change Order in the amount of
|
$
|
(4,740,195
|
)
|
The new Contract Price including this Change Order will be
|
$
|
2,984,316,780
|
|
/s/ Ed Lehotsky
|
|
/s/ Dena Volovar
|
Owner
|
|
Contractor
|
Ed Lehotsky
|
|
Dena Volovar
|
Name
|
|
Name
|
VP LNG Projects
|
|
Project Manager
|
Title
|
|
Title
|
April 19, 2016
|
|
March 22, 2016
|
Date of Signing
|
|
Date of Signing
|
PROJECT NAME:
Sabine Pass LNG Stage 3 Liquefaction Facility
OWNER:
Sabine Pass Liquefaction, LLC
CONTRACTOR:
Bechtel Oil, Gas and Chemicals, Inc.
DATE OF AGREEMENT: May 4, 2015
|
CHANGE ORDER NUMBER:
CO-00007
DATE OF CHANGE ORDER: May 10, 2016
|
1.
|
Per Article 6.1.B of the Agreement, Parties agree Bechtel will be compensated via this Change Order for FERC related support hours. Attachment A, Section 9.2 of the Agreement states:
|
2.
|
The cost breakdown for this scope of work is detailed in Exhibit A of this Change Order.
|
3.
|
Schedule C-1 (Milestone Payment Schedule) of Attachment C of the Agreement will be amended by including the milestone(s) listed in Exhibit B of this Change Order.
|
The original Contract Price was
|
$
|
2,987,000,000
|
|
Net change by previously authorized Change Orders (#0001-00006)
|
$
|
(2,683,220
|
)
|
The Contract Price prior to this Change Order was
|
$
|
2,984,316,780
|
|
The Contract Price will be (increased) by this Change Order in the amount of
|
$
|
1,558,953
|
|
The new Contract Price including this Change Order will be
|
$
|
2,985,875,733
|
|
/s/ Ed Lehotsky
|
|
/s/ Dena Volovar
|
Owner
|
|
Contractor
|
Ed Lehotsky
|
|
Dena Volovar
|
Name
|
|
Name
|
SVP LNG E&C
|
|
Principal Vice President
|
Title
|
|
Title
|
June 16, 2016
|
|
May 5, 2016
|
Date of Signing
|
|
Date of Signing
|
PROJECT NAME:
Sabine Pass LNG Stage 3 Liquefaction Facility
OWNER:
Sabine Pass Liquefaction, LLC
CONTRACTOR:
Bechtel Oil, Gas and Chemicals, Inc.
DATE OF AGREEMENT: May 4, 2015
|
CHANGE ORDER NUMBER:
CO-00008
DATE OF CHANGE ORDER: May 4, 2016
|
1.
|
Per Article 6.1.B of the Agreement, Parties agree Bechtel will modify the potable water system to remove the UV and Sodium Hypochlorite Injection Packages and to source the water for the potable water distribution directly from the City of Port Arthur pipeline with a 24” water tie-in pipe. The Reverse Osmosis (RO) Feedwater Dump and RO Reject will be rerouted to the outfall. Exhibit A of this Change Order depicts these changes.
|
2.
|
Per Article 6.1.B of the Agreement, Parties agree Bechtel will modify the Seal Gas Recovery System design to include small bore piping and control logic interface updates. Bechtel’s subcontractor will modify the refrigeration compressors to include new control valves, control logic updates, and interface updates. Exhibit B of this Change Order depicts these changes.
|
3.
|
The cost breakdown for these scopes of work are detailed in Exhibit C of this Change Order.
|
4.
|
Schedule C-1 (Milestone Payment Schedule) of Attachment C of the Agreement will be amended by including the milestone(s) listed in Exhibit D of this Change Order.
|
The original Contract Price was
|
$
|
2,987,000,000
|
|
Net change by previously authorized Change Orders (#0001-00007)
|
$
|
(1,124,267
|
)
|
The Contract Price prior to this Change Order was
|
$
|
2,985,875,733
|
|
The Contract Price will be (increased) by this Change Order in the amount of
|
$
|
(783,454
|
)
|
The new Contract Price including this Change Order will be
|
$
|
2,985,092,279
|
|
/s/ Ed Lehotsky
|
|
/s/ Dena Volovar
|
Owner
|
|
Contractor
|
Ed Lehotsky
|
|
Dena Volovar
|
Name
|
|
Name
|
SVP LNG E&C
|
|
Principal Vice President
|
Title
|
|
Title
|
June 16, 2016
|
|
May 5, 2016
|
Date of Signing
|
|
Date of Signing
|
PROJECT NAME:
Sabine Pass LNG Stage 3 Liquefaction Facility
OWNER:
Sabine Pass Liquefaction, LLC
CONTRACTOR:
Bechtel Oil, Gas and Chemicals, Inc.
DATE OF AGREEMENT: May 4, 2015
|
CHANGE ORDER NUMBER:
CO-00009
DATE OF CHANGE ORDER: May 17, 2016
|
1.
|
Per Article 6.1.B of the Agreement, Parties agree Bechtel will modify the current PSV bypass valve orientation on Subproject 5 so that the cavity relief vents of the PSV bypass valves are on the high pressure side of the valves.
|
2.
|
The cost breakdown for this Change Order is detailed in Exhibit A.
|
3.
|
Schedule C-1 (Milestone Payment Schedule) of Attachment C of the Agreement will be amended by including the milestone(s) listed in Exhibit B of this Change Order.
|
The original Contract Price was
|
$
|
2,987,000,000
|
|
Net change by previously authorized Change Orders (#0001-00008)
|
$
|
(1,907,721
|
)
|
The Contract Price prior to this Change Order was
|
$
|
2,985,092,279
|
|
The Contract Price will be (increased) by this Change Order in the amount of
|
$
|
14,933
|
|
The new Contract Price including this Change Order will be
|
$
|
2,985,107,212
|
|
/s/ Ed Lehotsky
|
|
/s/ Dena Volovar
|
Owner
|
|
Contractor
|
Ed Lehotsky
|
|
Dena Volovar
|
Name
|
|
Name
|
SVP LNG E&C
|
|
Principal Vice President
|
Title
|
|
Title
|
June 16, 2016
|
|
May 17, 2016
|
Date of Signing
|
|
Date of Signing
|
PROJECT NAME:
Sabine Pass LNG Stage 3 Liquefaction Facility
OWNER:
Sabine Pass Liquefaction, LLC
CONTRACTOR:
Bechtel Oil, Gas and Chemicals, Inc.
DATE OF AGREEMENT: May 4, 2015
|
CHANGE ORDER NUMBER:
CO-00010
DATE OF CHANGE ORDER: June 15, 2016
|
1.
|
Per Article 6.1.B of the Agreement, Parties agree Bechtel will remove the Chlorine Analyzer on the potable water distribution line from its Scope of Work to accommodate the removal of the Hypochlorite Injection Package that was included in Change Order 008. Exhibit A of this Change Order depicts this change.
|
2.
|
The cost breakdown for this Change Order is detailed in Exhibit B.
|
3.
|
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.
|
The original Contract Price was
|
$
|
2,987,000,000
|
|
Net change by previously authorized Change Orders (#0001-00009)
|
$
|
(1,892,788
|
)
|
The Contract Price prior to this Change Order was
|
$
|
2,985,107,212
|
|
The Contract Price will be (increased) by this Change Order in the amount of
|
$
|
(72,336
|
)
|
The new Contract Price including this Change Order will be
|
$
|
2,985,034,876
|
|
/s/ Ed Lehotsky
|
|
/s/ Dena Volovar
|
Owner
|
|
Contractor
|
Ed Lehotsky
|
|
Dena Volovar
|
Name
|
|
Name
|
SVP LNG E&C
|
|
Principal Vice President
|
Title
|
|
Title
|
June 30, 2016
|
|
June 16, 2016
|
Date of Signing
|
|
Date of Signing
|
1.
|
I have reviewed this
quarterly report on Form 10-Q
of Sabine Pass Liquefaction, LLC;
|
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;
|
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/ Jack A. Fusco
|
Jack A. Fusco
|
Chief Executive Officer of
|
Sabine Pass Liquefaction, LLC
|
1.
|
I have reviewed this
quarterly report on Form 10-Q
of Sabine Pass Liquefaction, LLC;
|
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 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;
|
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/ Michael J. Wortley
|
Michael J. Wortley
|
Chief Financial Officer of
|
Sabine Pass Liquefaction, LLC
|
(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 Company.
|
/s/ Jack A. Fusco
|
Jack A. Fusco
|
Chief Executive Officer of
|
Sabine Pass Liquefaction, LLC
|
(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 Company.
|
/s/ Michael J. Wortley
|
Michael J. Wortley
|
Chief Financial Officer of
|
Sabine Pass Liquefaction, LLC
|