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Delaware
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333-192373
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27-3235920
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(State or other jurisdiction of incorporation or organization)
|
(Commission File Number)
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(I.R.S. Employer Identification No.)
|
|
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700 Milam Street, Suite 1900
Houston, Texas
|
|
77002
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(Address of principal executive offices)
|
|
(Zip Code)
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Large accelerated filer
¨
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Accelerated filer
¨
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Non-accelerated filer
x
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Smaller reporting company
¨
|
(Do not check if a smaller reporting company)
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Bcf
|
|
billion cubic feet
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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
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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
|
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Cheniere Marketing, LLC and subsidiaries
|
Cheniere Partners
|
|
Cheniere Energy Partners, L.P.
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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
|
|
|
September 30,
|
|
December 31,
|
||||
|
|
2016
|
|
2015
|
||||
ASSETS
|
|
(unaudited)
|
|
|
||||
Current assets
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
—
|
|
|
$
|
—
|
|
Restricted cash
|
|
325,630
|
|
|
189,260
|
|
||
Accounts and other receivables
|
|
50,966
|
|
|
577
|
|
||
Accounts receivable—affiliate
|
|
56,986
|
|
|
2,457
|
|
||
Advances to affiliate
|
|
31,002
|
|
|
28,312
|
|
||
Inventory
|
|
51,715
|
|
|
5,742
|
|
||
Other current assets
|
|
11,256
|
|
|
8,412
|
|
||
Other current assets—affiliate
|
|
5,293
|
|
|
—
|
|
||
Total current assets
|
|
532,848
|
|
|
234,760
|
|
||
|
|
|
|
|
||||
Property, plant and equipment, net
|
|
11,491,279
|
|
|
9,841,407
|
|
||
Debt issuance costs, net
|
|
62,349
|
|
|
132,091
|
|
||
Non-current derivative assets
|
|
11,247
|
|
|
30,304
|
|
||
Other non-current assets
|
|
179,832
|
|
|
194,818
|
|
||
Total assets
|
|
$
|
12,277,555
|
|
|
$
|
10,433,380
|
|
|
|
|
|
|
||||
LIABILITIES AND MEMBER’S EQUITY
|
|
|
|
|
||||
Current liabilities
|
|
|
|
|
||||
Accounts payable
|
|
$
|
17,130
|
|
|
$
|
13,420
|
|
Accrued liabilities
|
|
326,815
|
|
|
201,559
|
|
||
Current debt
|
|
98,500
|
|
|
15,000
|
|
||
Due to affiliates
|
|
42,556
|
|
|
53,848
|
|
||
Derivative liabilities
|
|
7,459
|
|
|
6,430
|
|
||
Total current liabilities
|
|
492,460
|
|
|
290,257
|
|
||
|
|
|
|
|
||||
Long-term debt, net
|
|
11,330,473
|
|
|
9,205,559
|
|
||
Non-current derivative liabilities
|
|
9,583
|
|
|
2,884
|
|
||
Other non-current liabilities—affiliate
|
|
3,578
|
|
|
3,393
|
|
||
|
|
|
|
|
||||
Member’s equity
|
|
441,461
|
|
|
931,287
|
|
||
Total liabilities and member’s equity
|
|
$
|
12,277,555
|
|
|
$
|
10,433,380
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
|
September 30,
|
|
September 30,
|
||||||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Revenues
|
|
|
|
|
|
|
|
|
||||||||
LNG revenues
|
|
$
|
248,188
|
|
|
$
|
—
|
|
|
$
|
333,542
|
|
|
$
|
—
|
|
LNG revenues—affiliate
|
|
16,236
|
|
|
—
|
|
|
16,236
|
|
|
—
|
|
||||
Total revenues
|
|
264,424
|
|
|
—
|
|
|
349,778
|
|
|
—
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||
Operating costs and expenses
|
|
|
|
|
|
|
|
|
|
|
||||||
Cost (cost recovery) of sales (excluding depreciation and amortization expense shown separately below)
|
|
161,829
|
|
|
(32,106
|
)
|
|
217,567
|
|
|
(32,176
|
)
|
||||
Cost of sales—affiliate
|
|
3,245
|
|
|
—
|
|
|
3,890
|
|
|
—
|
|
||||
Operating and maintenance expense
|
|
24,588
|
|
|
1,623
|
|
|
40,606
|
|
|
4,655
|
|
||||
Operating and maintenance expense—affiliate
|
|
43,468
|
|
|
328
|
|
|
66,230
|
|
|
456
|
|
||||
Terminal use agreement maintenance expense (recovery)
|
|
72
|
|
|
(837
|
)
|
|
(546
|
)
|
|
16,684
|
|
||||
Terminal use agreement maintenance expense—affiliate
|
|
—
|
|
|
130
|
|
|
208
|
|
|
308
|
|
||||
Development expense
|
|
1
|
|
|
113
|
|
|
137
|
|
|
2,631
|
|
||||
Development expense—affiliate
|
|
87
|
|
|
152
|
|
|
484
|
|
|
562
|
|
||||
General and administrative expense
|
|
1,818
|
|
|
1,307
|
|
|
5,472
|
|
|
4,027
|
|
||||
General and administrative expense—affiliate
|
|
18,942
|
|
|
18,938
|
|
|
51,824
|
|
|
58,304
|
|
||||
Depreciation and amortization expense
|
|
25,749
|
|
|
461
|
|
|
37,863
|
|
|
1,279
|
|
||||
Total operating costs and expenses (recoveries)
|
|
279,799
|
|
|
(9,891
|
)
|
|
423,735
|
|
|
56,730
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Income (loss) from operations
|
|
(15,375
|
)
|
|
9,891
|
|
|
(73,957
|
)
|
|
(56,730
|
)
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Other income (expense)
|
|
|
|
|
|
|
|
|
|
|
||||||
Interest expense, net of capitalized interest
|
|
(65,939
|
)
|
|
(11,952
|
)
|
|
(99,203
|
)
|
|
(31,261
|
)
|
||||
Loss on early extinguishment of debt
|
|
(25,765
|
)
|
|
—
|
|
|
(52,070
|
)
|
|
(96,273
|
)
|
||||
Derivative gain (loss), net
|
|
2,557
|
|
|
(10,872
|
)
|
|
(13,473
|
)
|
|
(46,541
|
)
|
||||
Other income
|
|
179
|
|
|
98
|
|
|
429
|
|
|
320
|
|
||||
Total other expense
|
|
(88,968
|
)
|
|
(22,726
|
)
|
|
(164,317
|
)
|
|
(173,755
|
)
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Net loss
|
|
$
|
(104,343
|
)
|
|
$
|
(12,835
|
)
|
|
$
|
(238,274
|
)
|
|
$
|
(230,485
|
)
|
|
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
|
(238,274
|
)
|
|
(238,274
|
)
|
||
Balance at September 30, 2016
|
$
|
441,461
|
|
|
$
|
441,461
|
|
|
Nine Months Ended September 30,
|
||||||
|
2016
|
|
2015
|
||||
Cash flows from operating activities
|
|
|
|
||||
Net loss
|
$
|
(238,274
|
)
|
|
$
|
(230,485
|
)
|
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
|
|
|
|
||||
Non-cash terminal use agreement maintenance expense
|
160
|
|
|
16,610
|
|
||
Depreciation and amortization expense
|
37,863
|
|
|
1,279
|
|
||
Loss on early extinguishment of debt
|
52,070
|
|
|
96,273
|
|
||
Total losses on derivatives, net
|
35,635
|
|
|
13,136
|
|
||
Net cash used for settlement of derivative instruments
|
(8,031
|
)
|
|
(40,990
|
)
|
||
Changes in restricted cash for certain operating activities
|
157,291
|
|
|
230,187
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
||||
Accounts and other receivables
|
(31,022
|
)
|
|
8
|
|
||
Accounts receivable—affiliate
|
(36,650
|
)
|
|
(78
|
)
|
||
Advances to affiliate
|
—
|
|
|
(12,654
|
)
|
||
Inventory
|
(28,296
|
)
|
|
(41
|
)
|
||
Accounts payable and accrued liabilities
|
67,039
|
|
|
(42,179
|
)
|
||
Due to affiliates
|
3,885
|
|
|
(10,029
|
)
|
||
Other, net
|
(7,044
|
)
|
|
(1,840
|
)
|
||
Other—affiliate
|
(4,626
|
)
|
|
(19,197
|
)
|
||
Net cash provided by (used in) operating activities
|
—
|
|
|
—
|
|
||
|
|
|
|
||||
Cash flows from investing activities
|
|
|
|
|
|
||
Property, plant and equipment, net
|
(1,872,975
|
)
|
|
(2,094,567
|
)
|
||
Use of restricted cash for the acquisition of property, plant and equipment
|
1,905,102
|
|
|
2,144,821
|
|
||
Other
|
(32,127
|
)
|
|
(50,254
|
)
|
||
Net cash provided by (used in) investing activities
|
—
|
|
|
—
|
|
||
|
|
|
|
||||
Cash flows from financing activities
|
|
|
|
|
|
||
Proceeds from issuances of debt
|
4,968,500
|
|
|
2,250,000
|
|
||
Repayments of debt
|
(2,730,000
|
)
|
|
—
|
|
||
Debt issuance and deferred financing costs
|
(40,693
|
)
|
|
(176,002
|
)
|
||
Investment in restricted cash
|
(2,198,763
|
)
|
|
(2,089,295
|
)
|
||
Capital contributions from Cheniere Partners
|
1,250
|
|
|
15,297
|
|
||
Other
|
(294
|
)
|
|
—
|
|
||
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
|
$
|
—
|
|
|
$
|
—
|
|
|
|
September 30,
|
|
December 31,
|
||||
|
|
2016
|
|
2015
|
||||
Current restricted cash
|
|
|
|
|
||||
Liquefaction Project
|
|
$
|
325,630
|
|
|
$
|
189,260
|
|
|
|
September 30,
|
|
December 31,
|
||||
|
|
2016
|
|
2015
|
||||
Trade receivable
|
|
$
|
38,432
|
|
|
$
|
—
|
|
Interest receivable
|
|
53
|
|
|
7
|
|
||
Other accounts receivable
|
|
12,481
|
|
|
570
|
|
||
Total accounts and other receivables
|
|
$
|
50,966
|
|
|
$
|
577
|
|
|
|
September 30,
|
|
December 31,
|
||||
|
|
2016
|
|
2015
|
||||
Natural gas
|
|
$
|
4,181
|
|
|
$
|
5,724
|
|
LNG
|
|
25,280
|
|
|
—
|
|
||
Materials and other
|
|
22,254
|
|
|
18
|
|
||
Total inventory
|
|
$
|
51,715
|
|
|
$
|
5,742
|
|
|
|
September 30,
|
|
December 31,
|
||||
|
|
2016
|
|
2015
|
||||
LNG terminal costs
|
|
|
|
|
||||
LNG terminal
|
|
$
|
5,264,538
|
|
|
$
|
42,220
|
|
LNG terminal construction-in-process
|
|
6,254,085
|
|
|
9,795,309
|
|
||
Accumulated depreciation
|
|
(32,493
|
)
|
|
(789
|
)
|
||
Total LNG terminal costs, net
|
|
11,486,130
|
|
|
9,836,740
|
|
||
Fixed assets
|
|
|
|
|
|
|
||
Furniture and fixtures
|
|
1,446
|
|
|
1,154
|
|
||
Computer software
|
|
4,144
|
|
|
3,782
|
|
||
Machinery and equipment
|
|
405
|
|
|
339
|
|
||
Vehicles
|
|
2,419
|
|
|
1,405
|
|
||
Other
|
|
720
|
|
|
390
|
|
||
Accumulated depreciation
|
|
(3,985
|
)
|
|
(2,403
|
)
|
||
Total fixed assets, net
|
|
5,149
|
|
|
4,667
|
|
||
Property, plant and equipment, net
|
|
$
|
11,491,279
|
|
|
$
|
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 supply contracts 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
|
||||||||||||||||||||||||||||||
|
September 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
|
$
|
—
|
|
|
$
|
(15,948
|
)
|
|
$
|
—
|
|
|
$
|
(15,948
|
)
|
|
$
|
—
|
|
|
$
|
(8,740
|
)
|
|
$
|
—
|
|
|
$
|
(8,740
|
)
|
Liquefaction Supply Derivatives asset (liability)
|
(105
|
)
|
|
(275
|
)
|
|
12,480
|
|
|
12,100
|
|
|
—
|
|
|
(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
|
|
$12,480
|
|
Income Approach
|
|
Basis Spread
|
|
$(0.35) - $(0.03)
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Balance, beginning of period
|
|
$
|
22,434
|
|
|
$
|
440
|
|
|
$
|
32,492
|
|
|
$
|
342
|
|
Realized and mark-to-market losses:
|
|
|
|
|
|
|
|
|
||||||||
Included in cost of sales (1)
|
|
(10,567
|
)
|
|
32,177
|
|
|
(20,482
|
)
|
|
32,204
|
|
||||
Purchases and settlements:
|
|
|
|
|
|
|
|
|
||||||||
Purchases
|
|
968
|
|
|
—
|
|
|
968
|
|
|
—
|
|
||||
Settlements (1)
|
|
(308
|
)
|
|
(71
|
)
|
|
(741
|
)
|
|
—
|
|
||||
Transfers out of Level 3 (2)
|
|
(47
|
)
|
|
—
|
|
|
243
|
|
|
—
|
|
||||
Balance, end of period
|
|
$
|
12,480
|
|
|
$
|
32,546
|
|
|
$
|
12,480
|
|
|
$
|
32,546
|
|
Change in unrealized gains relating to instruments still held at end of period
|
|
$
|
(10,567
|
)
|
|
$
|
—
|
|
|
$
|
(19,763
|
)
|
|
$
|
—
|
|
|
(1)
|
Does not include the decrease in fair value of
$0.7 million
related to the realized gains capitalized during the
nine months ended September 30, 2016
.
|
(2)
|
Transferred to Level 2 as a result of observable market for the underlying natural gas supply contracts.
|
|
|
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
|
|
September 30, 2016
|
|
December 31, 2015
|
||||
Interest Rate Derivatives
|
|
Derivative liabilities
|
|
$
|
(6,376
|
)
|
|
$
|
(5,940
|
)
|
Interest Rate Derivatives
|
|
Non-current derivative liabilities
|
|
(9,572
|
)
|
|
(2,800
|
)
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Interest Rate Derivatives gain (loss)
|
|
$
|
2,557
|
|
|
$
|
(10,872
|
)
|
|
$
|
(13,473
|
)
|
|
$
|
(46,541
|
)
|
|
|
September 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
|
|
$
|
1,947
|
|
|
$
|
—
|
|
|
$
|
1,947
|
|
|
$
|
2,737
|
|
|
$
|
29
|
|
|
$
|
2,766
|
|
Non-current derivative assets
|
|
11,247
|
|
|
—
|
|
|
11,247
|
|
|
30,304
|
|
|
—
|
|
|
30,304
|
|
||||||
Total derivative assets
|
|
13,194
|
|
|
—
|
|
|
13,194
|
|
|
33,041
|
|
|
29
|
|
|
33,070
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Derivative liabilities
|
|
(1,083
|
)
|
|
—
|
|
|
(1,083
|
)
|
|
(490
|
)
|
|
—
|
|
|
(490
|
)
|
||||||
Non-current derivative liabilities
|
|
(11
|
)
|
|
—
|
|
|
(11
|
)
|
|
(84
|
)
|
|
—
|
|
|
(84
|
)
|
||||||
Total derivative liabilities
|
|
(1,094
|
)
|
|
—
|
|
|
(1,094
|
)
|
|
(574
|
)
|
|
—
|
|
|
(574
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Derivative asset, net
|
|
$
|
12,100
|
|
|
$
|
—
|
|
|
$
|
12,100
|
|
|
$
|
32,467
|
|
|
$
|
29
|
|
|
$
|
32,496
|
|
|
(1)
|
Does not include collateral of
$1.5 million
deposited for such contracts, which is included in
other current assets
in our Balance Sheet as of
September 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
|
|
Nine Months Ended
|
||||||||||||
|
|
|
September 30,
|
|
September 30,
|
||||||||||||
|
Statement of Operations Location
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Liquefaction Supply Derivatives gain
|
LNG revenues
|
|
$
|
374
|
|
|
$
|
—
|
|
|
$
|
368
|
|
|
$
|
—
|
|
Liquefaction Supply Derivatives gain (loss) (1)
|
Cost (cost recovery) of sales
|
|
(10,416
|
)
|
|
32,103
|
|
|
(22,680
|
)
|
|
32,184
|
|
||||
Natural Gas Derivatives gain
|
Operating and maintenance expense
|
|
—
|
|
|
778
|
|
|
150
|
|
|
1,221
|
|
|
|
|
Gross Amounts Recognized
|
|
Gross Amounts Offset in the Balance Sheets
|
|
Net Amounts Presented in the Balance Sheets
|
||||||
Offsetting Derivative Assets (Liabilities)
|
|
|
|
|||||||||
As of September 30, 2016
|
|
|
|
|
|
|
||||||
Interest Rate Derivatives
|
|
$
|
(15,948
|
)
|
|
$
|
—
|
|
|
$
|
(15,948
|
)
|
Liquefaction Supply Derivatives
|
|
13,740
|
|
|
(546
|
)
|
|
13,194
|
|
|||
Liquefaction Supply Derivatives
|
|
(2,803
|
)
|
|
1,709
|
|
|
(1,094
|
)
|
|||
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
|
|
|
|
September 30,
|
|
December 31,
|
||||
|
|
2016
|
|
2015
|
||||
Advances made under EPC and non-EPC contracts
|
|
$
|
13,678
|
|
|
$
|
32,049
|
|
Advances made to municipalities for water system enhancements
|
|
95,551
|
|
|
89,953
|
|
||
Tax-related payments and receivables
|
|
3,185
|
|
|
5,535
|
|
||
Information technology service assets
|
|
23,186
|
|
|
24,166
|
|
||
Other
|
|
44,232
|
|
|
43,115
|
|
||
Total other non-current assets
|
|
$
|
179,832
|
|
|
$
|
194,818
|
|
|
|
September 30,
|
|
December 31,
|
||||
|
|
2016
|
|
2015
|
||||
Interest costs and related debt fees
|
|
$
|
140,716
|
|
|
$
|
135,336
|
|
Liquefaction Project costs
|
|
185,961
|
|
|
66,223
|
|
||
Other accrued liabilities
|
|
138
|
|
|
—
|
|
||
Total accrued liabilities
|
|
$
|
326,815
|
|
|
$
|
201,559
|
|
|
|
September 30,
|
|
December 31,
|
||||
|
|
2016
|
|
2015
|
||||
Long-term debt
|
|
|
|
|
||||
5.625% Senior Secured Notes due 2021 (“2021 Senior Notes”), net of unamortized premium of $7,573 and $8,718
|
|
$
|
2,007,573
|
|
|
$
|
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 $5,844 and $6,392
|
|
1,505,844
|
|
|
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
|
|
|
—
|
|
||
5.00% Senior Secured Notes due 2027 (“2027 Senior Notes”)
|
|
1,500,000
|
|
|
—
|
|
||
2015 Credit Facilities
|
|
—
|
|
|
845,000
|
|
||
Unamortized debt issuance costs (1)
|
|
(182,944
|
)
|
|
(154,551
|
)
|
||
Total long-term debt, net
|
|
11,330,473
|
|
|
9,205,559
|
|
||
|
|
|
|
|
||||
Current debt
|
|
|
|
|
||||
$1.2 billion Working Capital Facility (“Working Capital Facility”)
|
|
98,500
|
|
|
15,000
|
|
||
Total debt, net
|
|
$
|
11,428,973
|
|
|
$
|
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
|
|
—
|
|
|
98,500
|
|
||
Commitments prepaid or terminated
|
|
2,643,867
|
|
|
—
|
|
||
Letters of credit issued
|
|
—
|
|
|
337,044
|
|
||
Available commitment
|
|
$
|
1,956,133
|
|
|
$
|
764,456
|
|
|
|
|
|
|
||||
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 September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Total interest cost
|
|
$
|
168,228
|
|
|
$
|
141,068
|
|
|
$
|
469,546
|
|
|
$
|
387,963
|
|
Capitalized interest
|
|
(102,289
|
)
|
|
(129,116
|
)
|
|
(370,343
|
)
|
|
(356,702
|
)
|
||||
Total interest expense, net
|
|
$
|
65,939
|
|
|
$
|
11,952
|
|
|
$
|
99,203
|
|
|
$
|
31,261
|
|
|
|
September 30, 2016
|
|
December 31, 2015
|
||||||||||||
|
|
Carrying
Amount
|
|
Estimated
Fair Value
|
|
Carrying
Amount
|
|
Estimated
Fair Value
|
||||||||
Senior Notes, net of premium (1)
|
|
$
|
11,513,417
|
|
|
$
|
12,281,145
|
|
|
$
|
8,515,110
|
|
|
$
|
7,469,718
|
|
Credit facilities (2)
|
|
98,500
|
|
|
98,500
|
|
|
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
;
2026 Senior Notes
; and
2027 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
|
|
Nine Months Ended
|
||||||||||||
|
September 30,
|
|
September 30,
|
|||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|||||||||
LNG revenues—affiliate
|
||||||||||||||||
Cheniere Marketing Master SPA
|
$
|
16,236
|
|
|
$
|
—
|
|
|
$
|
16,236
|
|
|
$
|
—
|
|
|
|
||||||||||||||||
Cost of sales—affiliate
|
||||||||||||||||
Cargo loading fees under the Terminal Use Rights Assignment and Agreement (the “TURA”)
|
1,815
|
|
|
—
|
|
|
2,460
|
|
|
—
|
|
|||||
Fees under the Pre-commercial LNG Marketing Agreement
|
1,430
|
|
|
—
|
|
|
1,430
|
|
|
—
|
|
|||||
Total cost of sales—affiliate
|
3,245
|
|
|
—
|
|
|
3,890
|
|
|
—
|
|
|||||
|
||||||||||||||||
Operating and maintenance expense—affiliate
|
||||||||||||||||
TUA
|
18,522
|
|
|
—
|
|
|
28,764
|
|
|
—
|
|
|||||
Natural Gas Transportation Agreement
|
16,660
|
|
|
—
|
|
|
24,344
|
|
|
—
|
|
|||||
Services Agreements
|
8,051
|
|
|
93
|
|
|
12,530
|
|
|
221
|
|
|||||
LNG Site Sublease Agreement
|
235
|
|
|
235
|
|
|
592
|
|
|
235
|
|
|||||
Total operating and maintenance expense—affiliate
|
43,468
|
|
|
328
|
|
|
66,230
|
|
|
456
|
|
|||||
|
||||||||||||||||
Terminal use agreement maintenance expense—affiliate
|
||||||||||||||||
TUA
|
—
|
|
|
130
|
|
|
208
|
|
|
308
|
|
|||||
|
||||||||||||||||
Development expense—affiliate
|
||||||||||||||||
Services Agreements
|
87
|
|
|
152
|
|
|
369
|
|
|
562
|
|
|||||
LNG Site Sublease Agreement
|
—
|
|
|
—
|
|
|
115
|
|
|
—
|
|
|||||
Total development expense—affiliate
|
87
|
|
|
152
|
|
|
484
|
|
|
562
|
|
|||||
|
||||||||||||||||
General and administrative expense—affiliate
|
||||||||||||||||
Services Agreements
|
18,942
|
|
|
18,938
|
|
|
51,824
|
|
|
58,048
|
|
|||||
LNG Site Sublease Agreement
|
—
|
|
|
—
|
|
|
—
|
|
|
241
|
|
|||||
Other agreements
|
—
|
|
|
—
|
|
|
—
|
|
|
15
|
|
|||||
Total general and administrative expense—affiliate
|
18,942
|
|
|
18,938
|
|
|
51,824
|
|
|
58,304
|
|
|
|
Nine Months Ended September 30,
|
||||||
|
|
2016
|
|
2015
|
||||
Cash paid during the period for interest, net of amounts capitalized
|
|
$
|
60,506
|
|
|
$
|
13,471
|
|
Non-cash distributions to affiliates for conveyance of assets
|
|
252,802
|
|
|
90,645
|
|
||
Other non-cash distribution to affiliates
|
|
—
|
|
|
149
|
|
||
Non-cash conveyance of assets to non-affiliate
|
|
—
|
|
|
13,169
|
|
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.
|
Standard
|
|
Description
|
|
Expected Date of Adoption
|
|
Effect on our Financial Statements or Other Significant Matters
|
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.
|
ASU 2016-16,
Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory
|
|
This standard requires the immediate recognition of the tax consequences of intercompany asset transfers other than inventory. This guidance may be early adopted, but only at the beginning of an annual period, and must be adopted using a modified retrospective approach.
|
|
January 1, 2018
|
|
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 imports into or 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 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, capital expenditures, maintenance and operating costs and cash flows, 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
|
•
|
We commenced production and shipment of LNG commissioning cargoes from Trains 1 and 2 of the
Liquefaction Project
in February and August 2016, respectively, and achieved substantial completion and commenced operating activities in May and September 2016, respectively.
|
•
|
In September 2016, we initiated the commissioning process for Train 3 of the
Liquefaction Project
.
|
•
|
In October 2016, the previously announced planned outage to improve performance of the flare systems at the
Liquefaction Project
, as well as to perform scheduled maintenance to Train 1 and other facilities, was completed on schedule and budget.
|
•
|
In May 2016, Jack Fusco was appointed as our Chief Executive Officer.
|
•
|
In June and September 2016, we issued 5.875% Senior Secured Notes due 2026
(the “2026 Senior Notes”)
and 5.00% Senior Secured Notes due 2027
(the “2027 Senior Notes”)
, respectively, for aggregate principal amounts of
$1.5 billion
each. Net proceeds of the offerings of the
2026 Senior Notes
and
2027 Senior Notes
were approximately
$1.3 billion
and
$1.4 billion
, respectively, after deducting commissions, fees and expenses and incremental interest required under the respective senior notes during construction. The net proceeds were used to prepay a portion (for the
2026 Senior Notes
) or all (for the
2027 Senior Notes
) of the outstanding borrowings under the credit facilities we entered into in June 2015
(the “2015 Credit Facilities”)
. The remaining proceeds from the
2027 Senior Notes
are being used to pay a portion of the capital costs in connection with the construction of Trains 1 through 5 of the Liquefaction Project in lieu of the terminated portion of the commitments under 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, the 2026 Senior Notes and the 2027 Senior Notes, the “Senior Notes”)
;
|
•
|
$1.5 billion
of
2026 Senior Notes
; and
|
•
|
$1.5 billion
of
2027 Senior Notes
.
|
|
Nine Months Ended September 30,
|
||||||
|
2016
|
|
2015
|
||||
Operating cash flows
|
|
|
|
||||
Net cash provided by (used in) operating activities
|
$
|
—
|
|
|
$
|
—
|
|
Changes in restricted cash for certain operating activities
|
(157,291
|
)
|
|
(230,187
|
)
|
||
Cash, cash equivalents and restricted cash used in operating activities
|
(157,291
|
)
|
|
(230,187
|
)
|
||
|
|
|
|
||||
Investing cash flows
|
|
|
|
||||
Net cash provided by (used in) investing activities
|
—
|
|
|
—
|
|
||
Use of restricted cash for the acquisition of property, plant and equipment
|
(1,905,102
|
)
|
|
(2,144,821
|
)
|
||
Cash, cash equivalents and restricted cash used in investing activities
|
(1,905,102
|
)
|
|
(2,144,821
|
)
|
||
|
|
|
|
||||
Financing cash flows
|
|
|
|
||||
Net cash provided by (used in) financing activities
|
—
|
|
|
—
|
|
||
Investment in restricted cash
|
2,198,763
|
|
|
2,089,295
|
|
||
Cash, cash equivalents and restricted cash provided by financing activities
|
2,198,763
|
|
|
2,089,295
|
|
||
|
|
|
|
||||
Net increase (decrease) in cash, cash equivalents and restricted cash
|
136,370
|
|
|
(285,713
|
)
|
||
Cash, cash equivalents and restricted cash—beginning of period
|
189,260
|
|
|
612,863
|
|
||
Cash, cash equivalents and restricted cash—end of period
|
$
|
325,630
|
|
|
$
|
327,150
|
|
•
|
$1.7 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
;
|
•
|
issuance of an aggregate principal amount of $1.5 billion of the
2027 Senior Notes
in September 2016, which was used to prepay $1.2 billion of the outstanding borrowings under the
2015 Credit Facilities
and pay a portion of the capital costs in connection with the construction of Trains 1 through 5 of the
Liquefaction Project
;
|
•
|
$313.5 million of borrowings and a $230.0 million repayment made under the
Working Capital Facility
;
|
•
|
$40.7 million
of debt issuance 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
nine months ended September 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
June 2015 and borrowing $250.0 million under this facility during the
nine months ended September 30, 2015
;
|
•
|
$176.0 million
of debt issuance and deferred financing costs related to up-front fees paid upon the closing of these transactions; and
|
•
|
$15.3 million
of equity contributions from Cheniere Partners.
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||
(in thousands)
|
2016
|
|
2015
|
|
Change
|
|
2016
|
|
2015
|
|
Change
|
||||||||||||
LNG revenues
|
$
|
248,188
|
|
|
$
|
—
|
|
|
$
|
248,188
|
|
|
$
|
333,542
|
|
|
$
|
—
|
|
|
$
|
333,542
|
|
LNG revenues—affiliate
|
16,236
|
|
|
—
|
|
|
16,236
|
|
|
16,236
|
|
|
—
|
|
|
16,236
|
|
||||||
Total revenues
|
$
|
264,424
|
|
|
$
|
—
|
|
|
$
|
264,424
|
|
|
$
|
349,778
|
|
|
$
|
—
|
|
|
$
|
349,778
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||
(in thousands)
|
2016
|
|
2015
|
|
Change
|
|
2016
|
|
2015
|
|
Change
|
||||||||||||
Cost (cost recovery) of sales
|
$
|
161,829
|
|
|
$
|
(32,106
|
)
|
|
$
|
193,935
|
|
|
$
|
217,567
|
|
|
$
|
(32,176
|
)
|
|
$
|
249,743
|
|
Cost of sales—affiliate
|
3,245
|
|
|
—
|
|
|
3,245
|
|
|
3,890
|
|
|
—
|
|
|
3,890
|
|
||||||
Operating and maintenance expense
|
24,588
|
|
|
1,623
|
|
|
22,965
|
|
|
40,606
|
|
|
4,655
|
|
|
35,951
|
|
||||||
Operating and maintenance expense—affiliate
|
43,468
|
|
|
328
|
|
|
43,140
|
|
|
66,230
|
|
|
456
|
|
|
65,774
|
|
||||||
Terminal use agreement maintenance expense (recovery)
|
72
|
|
|
(837
|
)
|
|
909
|
|
|
(546
|
)
|
|
16,684
|
|
|
(17,230
|
)
|
||||||
Terminal use agreement maintenance expense—affiliate
|
—
|
|
|
130
|
|
|
(130
|
)
|
|
208
|
|
|
308
|
|
|
(100
|
)
|
||||||
Development expense
|
1
|
|
|
113
|
|
|
(112
|
)
|
|
137
|
|
|
2,631
|
|
|
(2,494
|
)
|
||||||
Development expense—affiliate
|
87
|
|
|
152
|
|
|
(65
|
)
|
|
484
|
|
|
562
|
|
|
(78
|
)
|
||||||
General and administrative expense
|
1,818
|
|
|
1,307
|
|
|
511
|
|
|
5,472
|
|
|
4,027
|
|
|
1,445
|
|
||||||
General and administrative expense—affiliate
|
18,942
|
|
|
18,938
|
|
|
4
|
|
|
51,824
|
|
|
58,304
|
|
|
(6,480
|
)
|
||||||
Depreciation and amortization expense
|
25,749
|
|
|
461
|
|
|
25,288
|
|
|
37,863
|
|
|
1,279
|
|
|
36,584
|
|
||||||
Total operating costs and expenses
|
$
|
279,799
|
|
|
$
|
(9,891
|
)
|
|
$
|
289,690
|
|
|
$
|
423,735
|
|
|
$
|
56,730
|
|
|
$
|
367,005
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||
(in thousands)
|
2016
|
|
2015
|
|
Change
|
|
2016
|
|
2015
|
|
Change
|
||||||||||||
Interest expense, net of capitalized interest
|
$
|
65,939
|
|
|
$
|
11,952
|
|
|
$
|
53,987
|
|
|
$
|
99,203
|
|
|
$
|
31,261
|
|
|
$
|
67,942
|
|
Loss on early extinguishment of debt
|
25,765
|
|
|
—
|
|
|
25,765
|
|
|
52,070
|
|
|
96,273
|
|
|
(44,203
|
)
|
||||||
Derivative loss (gain), net
|
(2,557
|
)
|
|
10,872
|
|
|
(13,429
|
)
|
|
13,473
|
|
|
46,541
|
|
|
(33,068
|
)
|
||||||
Other income
|
(179
|
)
|
|
(98
|
)
|
|
(81
|
)
|
|
(430
|
)
|
|
(320
|
)
|
|
(110
|
)
|
||||||
Total other expense
|
$
|
88,968
|
|
|
$
|
22,726
|
|
|
$
|
66,242
|
|
|
$
|
164,316
|
|
|
$
|
173,755
|
|
|
$
|
(9,439
|
)
|
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
|
|
Eighth Supplemental Indenture, dated as of September 19, 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 September 23, 2016)
|
4.2
|
|
Ninth Supplemental Indenture, dated as of September 23 2016, between Sabine Pass Liquefaction, LLC and The Bank of New York Mellon, as Trustee under the Indenture (Incorporated by reference to Exhibit 4.2 to Cheniere Partners’ Current Report on Form 8-K (SEC File No. 001-33366), filed on September 23, 2016)
|
10.1*
|
|
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-00048 N2 Supply for High Pressure Tightness Test During Commissioning and Startup, dated July 12, 2016, (ii) the Change Order CO-00050 Train 2 N2 Dryout, dated July 29, 2016, (iii) the Change Order CO-00051 Six-Day Work Week for Insulation Scope — Subproject 2, dated August 9, 2016, and (iv) the Change Order CO-00052 Process Flares Modification Provisional Sum, dated September 1, 2016 (Portions of this exhibit have been omitted and filed separately with the SEC pursuant to a request for confidential treatment.)
|
10.2*
|
|
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-00024 Additional Support for FERC Document Requests, dated June 20, 2016, (ii) the Change Order CO-00025 N2 Supply for High Pressure Tightness Test During Commissioning and Startup, dated July 12, 2016, (iii) the Change Order CO-00027 Addition of Check Valves to Condensate Lines, dated July 29, 2016, (iv) the Change Order CO-00028 Additional Professional Services Support Hours for the Flare System Evaluation, dated August 3, 2016, and (v) the Change Order CO-00029 Lump Sum Process Flares Modification, dated September 1, 2016 (Portions of this exhibit have been omitted and filed separately with the SEC pursuant to a request for confidential treatment.)
|
10.3*
|
|
Change order 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.: the Change Order CO-00011 Site Drainage Design Change: Professional Service Hours, dated July 26, 2016
|
10.4
|
|
Registration Rights Agreement, dated as of September 23, 2016, between Sabine Pass Liquefaction, LLC and Merrill Lynch, Pierce, Fenner & Smith Incorporated (Incorporated by reference to Exhibit 10.1 to Cheniere Partners’ Current Report on Form 8-K (SEC File No. 001-33366), filed on September 23, 2016)
|
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:
|
November 2, 2016
|
By:
|
/s/ Michael J. Wortley
|
|
|
|
Michael J. Wortley
|
|
|
|
Chief Financial Officer
|
|
|
|
(on behalf of the registrant and
as principal financial officer) |
|
|
|
|
Date:
|
November 2, 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-00048
DATE OF CHANGE ORDER: July 12, 2016
|
1.
|
Per Article 6.1.B of the Agreement, Parties agree that, in lieu of using plant air for the leak test and purging the pipe with low pressure nitrogen currently on Site, Bechtel will use high pressure nitrogen during system leak testing for pre-commissioning and startup.
|
2.
|
The overall 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
|
$
|
3,900,000,000
|
|
Net change by previously authorized Change Orders (#0001-00047)
|
$
|
216,786,679
|
|
The Contract Price prior to this Change Order was
|
$
|
4,116,786,679
|
|
The Contract Price will be (increased) by this Change Order in the amount of
|
$
|
672,708
|
|
The new Contract Price including this Change Order will be
|
$
|
4,117,459,387
|
|
/s/ Ed Lehotsky
|
|
/s/ Dena Volovar
|
Owner
|
|
Contractor
|
Ed Lehotsky
|
|
Dena Volovar
|
Name
|
|
Name
|
SVP LNG E&C
|
|
Principal Vice President
|
Title
|
|
Title
|
August 8, 2016
|
|
July 12, 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-00050
DATE OF CHANGE ORDER: July 29, 2016
|
1.
|
Per Article 6.1.B of the Agreement, Parties agree that in lieu of using defrost gas, Bechtel will use nitrogen provided by SPL to perform dryout of cryogenic piping and equipment on Subproject 2.
|
2.
|
The overall 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
|
$
|
3,900,000,000
|
|
Net change by previously authorized Change Orders (#0001-00049)
|
$
|
220,459,387
|
|
The Contract Price prior to this Change Order was
|
$
|
4,120,459,387
|
|
The Contract Price will be (increased) by this Change Order in the amount of
|
$
|
164,564
|
|
The new Contract Price including this Change Order will be
|
$
|
4,120,623,951
|
|
/s/ Ed Lehotsky
|
|
/s/ Dena Volovar
|
Owner
|
|
Contractor
|
Ed Lehotsky
|
|
Dena Volovar
|
Name
|
|
Name
|
SVP LNG E&C
|
|
Principal Vice President
|
Title
|
|
Title
|
August 16, 2016
|
|
July 29, 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-00051
DATE OF CHANGE ORDER: August 9, 2016
|
1.
|
Per Article 6.1.B of the Agreement, Parties agree that Bechtel will work a six-day work week to advance insulation work on Subproject 2 to accommodate the planned shutdown for flare modification work.
|
2.
|
The overall 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
|
$
|
3,900,000,000
|
|
Net change by previously authorized Change Orders (#0001-00050)
|
$
|
220,623,951
|
|
The Contract Price prior to this Change Order was
|
$
|
4,120,623,951
|
|
The Contract Price will be (increased) by this Change Order in the amount of
|
$
|
841,445
|
|
The new Contract Price including this Change Order will be
|
$
|
4,121,465,396
|
|
/s/ Ed Lehotsky
|
|
/s/ Dena Volovar
|
Owner
|
|
Contractor
|
Ed Lehotsky
|
|
Dena Volovar
|
Name
|
|
Name
|
SVP LNG E&C
|
|
Principal Vice President
|
Title
|
|
Title
|
August 18, 2016
|
|
August 9, 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-00052
DATE OF CHANGE ORDER: September 1, 2016
|
1.
|
Per Article 6.1.B of the Agreement, the Parties agree Contractor will perform the process flares modification services as described in Exhibit A of this Change Order (“Provisional Sum Process Flare Modification Work”), which is hereby executed on a provisional sum basis and valued at *** U.S. Dollars (U.S.$***). In connection with this Change Order, Owner and Contractor are also entering into change order 00029 for the lump sum turnkey agreement for the engineering, procurement and construction of the Sabine Pass LNG Stage 2 Liquefaction Facility by and between Owner and Contractor, dated December 20, 2012, wherein Contractor will perform the remaining portion of the flare modification activities on a lump sum basis (“Lump Sum Process Flare Modification Work”, together with Lump Sum Process Flare Modification Work, the “Process Flare Modification Work”).
|
2.
|
Contractor shall be entitled to, and Owner agrees to pay, an early completion bonus as follows:
|
3.
|
Article 2 of Attachment EE, Schedule EE-2 will be amended to add the below Article 2.7 which shall state the following:
|
4.
|
The following definition will be added to the Article 1.1 of Agreement:
|
a.
|
“Process Flares Modification Provisional Sum” has the meaning set forth in Attachment EE.
|
5.
|
The definition of “
Provisional Sum
”
in Article 1.1 of the Agreement is hereby deleted and replaced with the following:
|
6.
|
The second sentence in Article 7.1 is hereby deleted and replaced with the following:
|
a.
|
The Contract Price is subject to adjustment only by Change Order as provided in Article 6, and includes all Taxes payable by Contractor and its Subcontractors and Sub-subcontractors in connection with the Work, the Louisiana Sales and Use Tax Provisional Sum, the Insurance Provisional Sum, the Operating Spare Part Provisional Sum, the Soils Preparation Provisional Sum, the Existing Facility Labor Provisional Sum, the Heavies Removal Unit Provisional Sum, the Currency Provisional Sum, the Fuel Provisional Sum, and the Process Flares Modification Provisional Sum and all costs, charges, and expenses of whatever nature necessary for performance of the Work.
|
7.
|
The Parties agree to adjust the Aggregate Provisional Sum specified in Article 7.1A of the Agreement which prior to this Change Order was Two Hundred Sixty Two Million Eighty One Thousand Seven Hundred Seventy Seven U.S. Dollars (U.S.$262,081,777). This Change Order will increase the Aggregate Provisional Sum amount by *** U.S. Dollars (U.S.$***) and the new Aggregate Provisional Sum value shall be *** U.S. Dollars (U.S.$***).
|
8.
|
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 (#0001-00051)
|
$
|
221,465,396
|
|
The Contract Price prior to this Change Order was
|
$
|
4,121,465,396
|
|
The Contract Price will be (increased) by this Change Order in the amount of
|
$
|
***
|
|
The new Contract Price including this Change Order will be
|
$
|
***
|
|
/s/ Ed Lehotsky
|
|
/s/ Dena Volovar
|
Owner
|
|
Contractor
|
Ed Lehotsky
|
|
Dena Volovar
|
Name
|
|
Name
|
SVP LNG E&C
|
|
Principal Vice President
|
Title
|
|
Title
|
September 16, 2016
|
|
September 2, 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-00024
DATE OF CHANGE ORDER: June 20, 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:
|
1.
|
The cost breakdown for this scope of work is detailed in Exhibit A of this Change Order.
|
2.
|
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 (#0001-00023)
|
$
|
32,078,647
|
|
The Contract Price prior to this Change Order was
|
$
|
3,801,078,647
|
|
The Contract Price will be (increased) by this Change Order in the amount of
|
$
|
271,500
|
|
The new Contract Price including this Change Order will be
|
$
|
3,801,350,147
|
|
/s/ Ed Lehotsky
|
|
/s/ Dena Volovar
|
Owner
|
|
Contractor
|
Ed Lehotsky
|
|
Dena Volovar
|
Name
|
|
Name
|
SVP LNG E&C
|
|
Principal Vice President
|
Title
|
|
Title
|
August 8, 2016
|
|
June 21, 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-00025
DATE OF CHANGE ORDER: July 12, 2016
|
1.
|
Per Article 6.1.B of the Agreement, Parties agree Bechtel that, in lieu of using plant air for the leak test and purging the pipe with low pressure nitrogen currently on Site, Bechtel will use high pressure nitrogen during system leak testing for pre-commissioning and startup.
|
2.
|
The following payment milestones in Attachment C of the Agreement will be amended:
|
3.
|
The cost breakdown for this scope of work is detailed in Exhibit A 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 B of this Change Order.
|
The original Contract Price was
|
$
|
3,769,000,000
|
|
Net change by previously authorized Change Orders (#0001-00024)
|
$
|
32,350,147
|
|
The Contract Price prior to this Change Order was
|
$
|
3,801,350,147
|
|
The Contract Price will be (increased) by this Change Order in the amount of
|
$
|
645,171
|
|
The new Contract Price including this Change Order will be
|
$
|
3,801,995,318
|
|
/s/ Ed Lehotsky
|
|
/s/ Dena Volovar
|
Owner
|
|
Contractor
|
Ed Lehotsky
|
|
Dena Volovar
|
Name
|
|
Name
|
SVP LNG E&C
|
|
Principal Vice President
|
Title
|
|
Title
|
August 8, 2016
|
|
July 12, 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-00027
DATE OF CHANGE ORDER: July 29, 2016
|
1.
|
Per Article 6.1.B of the Agreement, Parties agree that Bechtel will design and procure a check valve for SPL installation on Subproject 1, and Bechtel will design, procure and install check valves on Subprojects 2, 3 and 4. Exhibit A of this Change Order depicts these changes.
|
2.
|
The cost breakdown for this scope of work is detailed in Exhibit B 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 C of this Change Order.
|
The original Contract Price was
|
$
|
3,769,000,000
|
|
Net change by previously authorized Change Orders (#0001-00026)
|
$
|
89,995,318
|
|
The Contract Price prior to this Change Order was
|
$
|
3,858,995,318
|
|
The Contract Price will be (increased) by this Change Order in the amount of
|
$
|
65,053
|
|
The new Contract Price including this Change Order will be
|
$
|
3,859,060,371
|
|
/s/ Ed Lehotsky
|
|
/s/ Dena Volovar
|
Owner
|
|
Contractor
|
Ed Lehotsky
|
|
Dena Volovar
|
Name
|
|
Name
|
SVP LNG E&C
|
|
Principal Vice President
|
Title
|
|
Title
|
August 18, 2016
|
|
July 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-00028
DATE OF CHANGE ORDER: August 3, 2016
|
1.
|
Per Article 6.1.B of the Agreement, Parties agree that Bechtel will upgrade the wet and dry process flares to a High Pressure Air Assist (HPAA) design. This Change Order includes only the professional service hours associated with the HPAA design upgrade of the wet and dry flares. Professional service hours related to the marine flare modifications are excluded.
|
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
|
$
|
3,769,000,000
|
|
Net change by previously authorized Change Orders (#0001-00027)
|
$
|
90,060,371
|
|
The Contract Price prior to this Change Order was
|
$
|
3,859,060,371
|
|
The Contract Price will be (increased) by this Change Order in the amount of
|
$
|
1,660,000
|
|
The new Contract Price including this Change Order will be
|
$
|
3,860,720,371
|
|
/s/ Ed Lehotsky
|
|
/s/ Dena Volovar
|
Owner
|
|
Contractor
|
Ed Lehotsky
|
|
Dena Volovar
|
Name
|
|
Name
|
SVP LNG E&C
|
|
Principal Vice President
|
Title
|
|
Title
|
August 19, 2016
|
|
August 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-00029
DATE OF CHANGE ORDER: September 1, 2016
|
1.
|
Per Article 6.1.B of the Agreement, the Parties agree Contractor will perform process flares modification services as described in Exhibit A of this Change Order (“Lump Sum Process Flare Modification Work”) on a lump sum basis and valued at *** U.S. Dollars ($***). In connection with this Change Order, Owner and Contractor are also entering into change order 00052 for the Stage 1 EPC Agreement, wherein Contractor will perform the remaining portion of the flare modification activities on a provisional sum basis (“Provisional Sum Process Flare Modification Work”, together with Lump Sum Process Flare Modification Work, the “Process Flare Modification Work”).
|
2.
|
Additionally, this Change Order CO-00029 includes impacts to Subproject 3 and Subproject 4 as a result of the flare modifications activities (“Lump Sum Process Flare Modification Impacts”) valued at *** U.S. Dollars ($***). The Parties agree that the Lump Sum Process Flare Modification Impacts value is based on the shared assumption that the flare modifications outage duration will be a period of 26 Days beginning from Owner’s notification to Contractor that the process flares are isolated and available for modification and ending upon Contractor’s notification to Owner that the process flares outage activities are complete (the “Flare Work Period”). The total value of this Change Order is *** U.S. Dollars ($***).
|
3.
|
The Parties agree that the Process Flare Modification Work is not a requirement to achieve Substantial Completion of Subproject 3.
|
4.
|
Schedule C-1 (Milestone Payment Schedule) of Attachment C of the Agreement is hereby 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 (#0001-00028)
|
$
|
91,720,371
|
|
The Contract Price prior to this Change Order was
|
$
|
3,860,720,371
|
|
The Contract Price will be (increased) by this Change Order in the amount of
|
$
|
***
|
|
The new Contract Price including this Change Order will be
|
$
|
***
|
|
Notice to Proceed
|
Day Zero
|
Ready for Start Up for Subproject 3
|
One thousand three hundred and seventy three (1373) Days from Owner’s issuance of Notice to Proceed
|
Target Substantial Completion for Subproject 3
|
One thousand four hundred ninety three (1493) Days from Owner’s issuance of Notice to Proceed
|
Guaranteed Substantial Completion for Subproject 3
|
One thousand four hundred ninety five (1495) Days from Owner’s issuance of Notice to Proceed
|
Ready for Start Up for Subproject 4
|
One thousand six hundred forty (1640) Days from Owner’s issuance of Notice to Proceed
|
Target Substantial Completion for Subproject 4
|
One thousand seven hundred sixty (1760) Days from Owner’s issuance of Notice to Proceed
|
Guaranteed Substantial Completion for Subproject 4
|
One thousand seven hundred sixty two (1762) Days from Owner’s issuance of Notice to Proceed
|
Final Completion
|
One hundred eighty (180) Days after Substantial Completion of Subproject 4
|
/s/ Ed Lehotsky
|
|
/s/ Dena Volovar
|
Owner
|
|
Contractor
|
Ed Lehotsky
|
|
Dena Volovar
|
Name
|
|
Name
|
SVP LNG E&C
|
|
Principal Vice President
|
Title
|
|
Title
|
September 16, 2016
|
|
September 2, 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-00011
DATE OF CHANGE ORDER: July 26, 2016
|
1.
|
Per Article 6.1.B of the Agreement, Parties agree Bechtel will redesign the Stage 3 Site drainage system to include a second outfall that will discharge on the southeast side of the Stage 3 Site, crossing under Lighthouse Road, with the final discharge on the east side of Lighthouse Road. This Change Order only includes the scope to perform the engineering associated with this drainage system design change. Procurement, construction, soil stabilization, schedule, cost and other Project impacts associated with the execution of the interim and permanent drainage design change are excluded. Exhibit A of this Change Order depicts these changes.
|
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 (#0001-00010)
|
$
|
(1,965,124
|
)
|
The Contract Price prior to this Change Order was
|
$
|
2,985,034,876
|
|
The Contract Price will be (increased) by this Change Order in the amount of
|
$
|
1,173,296
|
|
The new Contract Price including this Change Order will be
|
$
|
2,986,208,172
|
|
/s/ Ed Lehotsky
|
|
/s/ Dena Volovar
|
Owner
|
|
Contractor
|
Ed Lehotsky
|
|
Dena Volovar
|
Name
|
|
Name
|
SVP LNG E&C
|
|
Principal Vice President
|
Title
|
|
Title
|
August 15, 2016
|
|
July 29, 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):
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a)
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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
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b)
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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.
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/s/ Michael J. Wortley
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Michael J. Wortley
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Chief Financial Officer of
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Sabine Pass Liquefaction, LLC
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(1)
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The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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(2)
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The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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/s/ Jack A. Fusco
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Jack A. Fusco
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Chief Executive Officer of
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Sabine Pass Liquefaction, LLC
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(1)
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The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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(2)
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The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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/s/ Michael J. Wortley
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Michael J. Wortley
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Chief Financial Officer of
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Sabine Pass Liquefaction, LLC
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