|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Delaware
|
27-3235920
|
|
(State or other jurisdiction of incorporation or organization)
|
(I.R.S. Employer Identification No.)
|
|
|
|
|
|
|
|
Title of each class
|
Trading Symbol
|
Name of each exchange on which registered
|
|
None
|
None
|
None
|
|
|
Large Accelerated Filer
|
☐
|
|
Accelerated filer
|
☐
|
|
|
Non-accelerated filer
|
☒
|
|
Smaller reporting company
|
☐
|
|
|
|
|
|
Emerging growth company
|
☐
|
|
|
|
|
|
|
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
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 that, through a refrigeration process, has been cooled to a liquid state, which occupies a volume that is approximately 1/600th of its gaseous state
|
|
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
|
|
U.S. Securities and Exchange Commission
|
|
SPA
|
|
LNG sale and purchase agreement
|
|
TBtu
|
|
trillion British thermal units, an energy unit
|
|
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
|
|
|
|
September 30,
|
|
December 31,
|
||||
|
|
|
2019
|
|
2018
|
||||
|
ASSETS
|
|
(unaudited)
|
|
|
||||
|
Current assets
|
|
|
|
|
||||
|
Cash and cash equivalents
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Restricted cash
|
|
185
|
|
|
756
|
|
||
|
Accounts and other receivables
|
|
274
|
|
|
346
|
|
||
|
Accounts receivable—affiliate
|
|
66
|
|
|
113
|
|
||
|
Advances to affiliate
|
|
154
|
|
|
210
|
|
||
|
Inventory
|
|
90
|
|
|
87
|
|
||
|
Derivative assets
|
|
8
|
|
|
6
|
|
||
|
Other current assets
|
|
52
|
|
|
18
|
|
||
|
Other current assets—affiliate
|
|
22
|
|
|
21
|
|
||
|
Total current assets
|
|
851
|
|
|
1,557
|
|
||
|
|
|
|
|
|
||||
|
Property, plant and equipment, net
|
|
13,831
|
|
|
13,209
|
|
||
|
Debt issuance costs, net
|
|
7
|
|
|
12
|
|
||
|
Non-current derivative assets
|
|
29
|
|
|
31
|
|
||
|
Other non-current assets, net
|
|
153
|
|
|
158
|
|
||
|
Total assets
|
|
$
|
14,871
|
|
|
$
|
14,967
|
|
|
|
|
|
|
|
||||
|
LIABILITIES AND MEMBER’S EQUITY
|
|
|
|
|
||||
|
Current liabilities
|
|
|
|
|
||||
|
Accounts payable
|
|
$
|
12
|
|
|
$
|
11
|
|
|
Accrued liabilities
|
|
544
|
|
|
768
|
|
||
|
Due to affiliates
|
|
45
|
|
|
48
|
|
||
|
Deferred revenue
|
|
148
|
|
|
91
|
|
||
|
Derivative liabilities
|
|
29
|
|
|
66
|
|
||
|
Total current liabilities
|
|
778
|
|
|
984
|
|
||
|
|
|
|
|
|
||||
|
Long-term debt, net
|
|
13,518
|
|
|
13,500
|
|
||
|
Non-current derivative liabilities
|
|
32
|
|
|
14
|
|
||
|
Other non-current liabilities
|
|
6
|
|
|
3
|
|
||
|
Other non-current liabilities—affiliate
|
|
16
|
|
|
—
|
|
||
|
|
|
|
|
|
||||
|
Member’s equity
|
|
521
|
|
|
466
|
|
||
|
Total liabilities and member’s equity
|
|
$
|
14,871
|
|
|
$
|
14,967
|
|
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
Revenues
|
|
|
|
|
|
|
|
|
||||||||
|
LNG revenues
|
|
$
|
1,140
|
|
|
$
|
1,249
|
|
|
$
|
3,678
|
|
|
$
|
3,419
|
|
|
LNG revenues—affiliate
|
|
257
|
|
|
205
|
|
|
1,017
|
|
|
886
|
|
||||
|
Total revenues
|
|
1,397
|
|
|
1,454
|
|
|
4,695
|
|
|
4,305
|
|
||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
Operating costs and expenses
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Cost of sales (excluding depreciation and amortization expense shown separately below)
|
|
742
|
|
|
758
|
|
|
2,501
|
|
|
2,291
|
|
||||
|
Cost of sales—affiliate
|
|
17
|
|
|
8
|
|
|
35
|
|
|
23
|
|
||||
|
Operating and maintenance expense
|
|
150
|
|
|
96
|
|
|
398
|
|
|
258
|
|
||||
|
Operating and maintenance expense—affiliate
|
|
113
|
|
|
107
|
|
|
335
|
|
|
317
|
|
||||
|
Development expense
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
||||
|
General and administrative expense
|
|
1
|
|
|
1
|
|
|
4
|
|
|
4
|
|
||||
|
General and administrative expense—affiliate
|
|
28
|
|
|
12
|
|
|
64
|
|
|
36
|
|
||||
|
Depreciation and amortization expense
|
|
117
|
|
|
88
|
|
|
331
|
|
|
261
|
|
||||
|
Impairment expense and loss on disposal of assets
|
|
1
|
|
|
—
|
|
|
6
|
|
|
—
|
|
||||
|
Total operating costs and expenses
|
|
1,169
|
|
|
1,070
|
|
|
3,674
|
|
|
3,191
|
|
||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
Income from operations
|
|
228
|
|
|
384
|
|
|
1,021
|
|
|
1,114
|
|
||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
Other income (expense)
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Interest expense, net of capitalized interest
|
|
(183
|
)
|
|
(146
|
)
|
|
(524
|
)
|
|
(445
|
)
|
||||
|
Other income
|
|
3
|
|
|
5
|
|
|
9
|
|
|
9
|
|
||||
|
Total other expense
|
|
(180
|
)
|
|
(141
|
)
|
|
(515
|
)
|
|
(436
|
)
|
||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
Net income
|
|
$
|
48
|
|
|
$
|
243
|
|
|
$
|
506
|
|
|
$
|
678
|
|
|
Three and Nine Months Ended September 30, 2019
|
|
|
|
||||
|
|
Sabine Pass LNG-LP, LLC
|
|
Total Member’s Equity
|
||||
|
Balance at December 31, 2018
|
$
|
466
|
|
|
$
|
466
|
|
|
Capital contributions
|
164
|
|
|
164
|
|
||
|
Distributions
|
(231
|
)
|
|
(231
|
)
|
||
|
Net income
|
308
|
|
|
308
|
|
||
|
Balance at March 31, 2019
|
707
|
|
|
707
|
|
||
|
Capital contributions
|
642
|
|
|
642
|
|
||
|
Distributions
|
(965
|
)
|
|
(965
|
)
|
||
|
Net income
|
150
|
|
|
150
|
|
||
|
Balance at June 30, 2019
|
534
|
|
|
534
|
|
||
|
Capital contributions
|
143
|
|
|
143
|
|
||
|
Distributions
|
(204
|
)
|
|
(204
|
)
|
||
|
Net income
|
48
|
|
|
48
|
|
||
|
Balance at September 30, 2019
|
$
|
521
|
|
|
$
|
521
|
|
|
Three and Nine Months Ended September 30, 2018
|
|
|
Total Member’s Equity (Deficit)
|
||||
|
|
Sabine Pass LNG-LP, LLC
|
|
|||||
|
Balance at December 31, 2017
|
$
|
(38
|
)
|
|
$
|
(38
|
)
|
|
Net income
|
242
|
|
|
242
|
|
||
|
Balance at March 31, 2018
|
204
|
|
|
204
|
|
||
|
Capital contributions
|
25
|
|
|
25
|
|
||
|
Net income
|
193
|
|
|
193
|
|
||
|
Balance at June 30, 2018
|
422
|
|
|
422
|
|
||
|
Capital contributions
|
56
|
|
|
56
|
|
||
|
Distributions
|
(350
|
)
|
|
(350
|
)
|
||
|
Net income
|
243
|
|
|
243
|
|
||
|
Balance at September 30, 2018
|
$
|
371
|
|
|
$
|
371
|
|
|
|
Nine Months Ended September 30,
|
||||||
|
|
2019
|
|
2018
|
||||
|
Cash flows from operating activities
|
|
|
|
||||
|
Net income
|
$
|
506
|
|
|
$
|
678
|
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
||||
|
Depreciation and amortization expense
|
331
|
|
|
261
|
|
||
|
Amortization of debt issuance costs, deferred commitment fees, premium and discount
|
20
|
|
|
16
|
|
||
|
Total losses (gains) on derivatives, net
|
(30
|
)
|
|
42
|
|
||
|
Net cash provided by (used for) settlement of derivative instruments
|
11
|
|
|
(6
|
)
|
||
|
Impairment expense and loss on disposal of assets
|
6
|
|
|
—
|
|
||
|
Changes in operating assets and liabilities:
|
|
|
|
||||
|
Accounts and other receivables
|
37
|
|
|
(33
|
)
|
||
|
Accounts receivable—affiliate
|
47
|
|
|
141
|
|
||
|
Advances to affiliate
|
(43
|
)
|
|
(75
|
)
|
||
|
Inventory
|
(2
|
)
|
|
7
|
|
||
|
Accounts payable and accrued liabilities
|
(261
|
)
|
|
(106
|
)
|
||
|
Due to affiliates
|
4
|
|
|
(3
|
)
|
||
|
Deferred revenue
|
56
|
|
|
11
|
|
||
|
Other, net
|
(26
|
)
|
|
(5
|
)
|
||
|
Net cash provided by operating activities
|
656
|
|
|
928
|
|
||
|
|
|
|
|
||||
|
Cash flows from investing activities
|
|
|
|
|
|
||
|
Property, plant and equipment, net
|
(1,123
|
)
|
|
(554
|
)
|
||
|
Other
|
(1
|
)
|
|
—
|
|
||
|
Net cash used in investing activities
|
(1,124
|
)
|
|
(554
|
)
|
||
|
|
|
|
|
||||
|
Cash flows from financing activities
|
|
|
|
|
|
||
|
Capital contributions
|
949
|
|
|
81
|
|
||
|
Distributions
|
(1,052
|
)
|
|
(350
|
)
|
||
|
Net cash used in financing activities
|
(103
|
)
|
|
(269
|
)
|
||
|
|
|
|
|
||||
|
Net increase (decrease) in cash, cash equivalents and restricted cash
|
(571
|
)
|
|
105
|
|
||
|
Cash, cash equivalents and restricted cash—beginning of period
|
756
|
|
|
544
|
|
||
|
Cash, cash equivalents and restricted cash—end of period
|
$
|
185
|
|
|
$
|
649
|
|
|
|
September 30, 2019
|
||
|
Cash and cash equivalents
|
$
|
—
|
|
|
Restricted cash
|
185
|
|
|
|
Total cash, cash equivalents and restricted cash
|
$
|
185
|
|
|
|
|
September 30,
|
|
December 31,
|
||||
|
|
|
2019
|
|
2018
|
||||
|
Current restricted cash
|
|
|
|
|
||||
|
Liquefaction Project
|
|
$
|
185
|
|
|
$
|
756
|
|
|
|
|
September 30,
|
|
December 31,
|
||||
|
|
|
2019
|
|
2018
|
||||
|
Trade receivable
|
|
$
|
261
|
|
|
$
|
330
|
|
|
Other accounts receivable
|
|
13
|
|
|
16
|
|
||
|
Total accounts and other receivables
|
|
$
|
274
|
|
|
$
|
346
|
|
|
|
|
September 30,
|
|
December 31,
|
||||
|
|
|
2019
|
|
2018
|
||||
|
Natural gas
|
|
$
|
15
|
|
|
$
|
28
|
|
|
LNG
|
|
7
|
|
|
6
|
|
||
|
Materials and other
|
|
68
|
|
|
53
|
|
||
|
Total inventory
|
|
$
|
90
|
|
|
$
|
87
|
|
|
|
|
September 30,
|
|
December 31,
|
||||
|
|
|
2019
|
|
2018
|
||||
|
LNG terminal costs
|
|
|
|
|
||||
|
LNG terminal
|
|
$
|
13,684
|
|
|
$
|
10,004
|
|
|
LNG terminal construction-in-process
|
|
1,130
|
|
|
3,866
|
|
||
|
Accumulated depreciation
|
|
(989
|
)
|
|
(667
|
)
|
||
|
Total LNG terminal costs, net
|
|
13,825
|
|
|
13,203
|
|
||
|
Fixed assets
|
|
|
|
|
|
|
||
|
Fixed assets
|
|
17
|
|
|
14
|
|
||
|
Accumulated depreciation
|
|
(11
|
)
|
|
(8
|
)
|
||
|
Total fixed assets, net
|
|
6
|
|
|
6
|
|
||
|
Property, plant and equipment, net
|
|
$
|
13,831
|
|
|
$
|
13,209
|
|
|
|
Fair Value Measurements as of
|
||||||||||||||||||||||||||||||
|
|
September 30, 2019
|
|
December 31, 2018
|
||||||||||||||||||||||||||||
|
|
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
|
||||||||||||||||
|
Liquefaction Supply Derivatives asset (liability)
|
$
|
(6
|
)
|
|
$
|
(10
|
)
|
|
$
|
(8
|
)
|
|
$
|
(24
|
)
|
|
$
|
5
|
|
|
$
|
(23
|
)
|
|
$
|
(25
|
)
|
|
$
|
(43
|
)
|
|
|
|
Net Fair Value Liability
(in millions)
|
|
Valuation Approach
|
|
Significant Unobservable Input
|
|
Significant Unobservable Inputs Range
|
|
Physical Liquefaction Supply Derivatives
|
|
$(8)
|
|
Market approach incorporating present value techniques
|
|
Henry Hub basis spread
|
|
$(0.618) - $0.056
|
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
Balance, beginning of period
|
|
$
|
34
|
|
|
$
|
11
|
|
|
$
|
(25
|
)
|
|
$
|
43
|
|
|
Realized and mark-to-market gains (losses):
|
|
|
|
|
|
|
|
|
||||||||
|
Included in cost of sales
|
|
(42
|
)
|
|
4
|
|
|
(22
|
)
|
|
(5
|
)
|
||||
|
Purchases and settlements:
|
|
|
|
|
|
|
|
|
||||||||
|
Purchases
|
|
(1
|
)
|
|
4
|
|
|
(4
|
)
|
|
8
|
|
||||
|
Settlements
|
|
1
|
|
|
1
|
|
|
43
|
|
|
(27
|
)
|
||||
|
Transfers out of Level 3 (1)
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
||||
|
Balance, end of period
|
|
$
|
(8
|
)
|
|
$
|
19
|
|
|
$
|
(8
|
)
|
|
$
|
19
|
|
|
Change in unrealized gains (losses) relating to instruments still held at end of period
|
|
$
|
(42
|
)
|
|
$
|
4
|
|
|
$
|
(22
|
)
|
|
$
|
(5
|
)
|
|
|
|
|
|
Fair Value Measurements as of (1)
|
||||||
|
Balance Sheet Location
|
|
September 30, 2019
|
|
December 31, 2018
|
||||
|
Derivative assets
|
|
$
|
8
|
|
|
$
|
6
|
|
|
Non-current derivative assets
|
|
29
|
|
|
31
|
|
||
|
Total derivative assets
|
|
37
|
|
|
37
|
|
||
|
|
|
|
|
|
||||
|
Derivative liabilities
|
|
(29
|
)
|
|
(66
|
)
|
||
|
Non-current derivative liabilities
|
|
(32
|
)
|
|
(14
|
)
|
||
|
Total derivative liabilities
|
|
(61
|
)
|
|
(80
|
)
|
||
|
|
|
|
|
|
||||
|
Derivative liability, net
|
|
$
|
(24
|
)
|
|
$
|
(43
|
)
|
|
|
|
(1)
|
Does not include collateral calls of $10 million and $1 million for such contracts, which are included in other current assets in our Balance Sheets as of September 30, 2019 and December 31, 2018, respectively.
|
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
|
Statement of Income Location (1)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
Liquefaction Supply Derivatives gain
|
LNG revenues
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
2
|
|
|
$
|
—
|
|
|
Liquefaction Supply Derivatives gain (loss)
|
Cost of sales
|
(55
|
)
|
|
10
|
|
|
28
|
|
|
(42
|
)
|
||||
|
|
|
(1)
|
Does not include the realized value associated with derivative instruments that settle through physical delivery. Fair value fluctuations associated with commodity derivative activities are classified and presented consistently with the item economically hedged and the nature and intent of the derivative instrument.
|
|
|
|
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, 2019
|
|
|
|
|
|
|
||||||
|
Liquefaction Supply Derivatives
|
|
$
|
40
|
|
|
$
|
(3
|
)
|
|
$
|
37
|
|
|
Liquefaction Supply Derivatives
|
|
(63
|
)
|
|
2
|
|
|
(61
|
)
|
|||
|
As of December 31, 2018
|
|
|
|
|
|
|
||||||
|
Liquefaction Supply Derivatives
|
|
$
|
63
|
|
|
$
|
(26
|
)
|
|
$
|
37
|
|
|
Liquefaction Supply Derivatives
|
|
(92
|
)
|
|
12
|
|
|
(80
|
)
|
|||
|
|
|
September 30,
|
|
December 31,
|
||||
|
|
|
2019
|
|
2018
|
||||
|
Advances made to municipalities for water system enhancements
|
|
$
|
88
|
|
|
$
|
90
|
|
|
Advances and other asset conveyances to third parties to support LNG terminals
|
|
35
|
|
|
36
|
|
||
|
Operating lease assets
|
|
21
|
|
|
—
|
|
||
|
Information technology service prepayments
|
|
7
|
|
|
16
|
|
||
|
Advances made under EPC and non-EPC contracts
|
|
2
|
|
|
14
|
|
||
|
Other
|
|
—
|
|
|
2
|
|
||
|
Total other non-current assets, net
|
|
$
|
153
|
|
|
$
|
158
|
|
|
|
|
September 30,
|
|
December 31,
|
||||
|
|
|
2019
|
|
2018
|
||||
|
Interest costs and related debt fees
|
|
$
|
143
|
|
|
$
|
186
|
|
|
Accrued natural gas purchases
|
|
254
|
|
|
518
|
|
||
|
Liquefaction Project costs
|
|
145
|
|
|
64
|
|
||
|
Other accrued liabilities
|
|
2
|
|
|
—
|
|
||
|
Total accrued liabilities
|
|
$
|
544
|
|
|
$
|
768
|
|
|
|
|
September 30,
|
|
December 31,
|
||||
|
|
|
2019
|
|
2018
|
||||
|
Long-term debt
|
|
|
|
|
||||
|
5.625% Senior Secured Notes due 2021 (“2021 Senior Notes”)
|
|
$
|
2,000
|
|
|
$
|
2,000
|
|
|
6.25% Senior Secured Notes due 2022 (“2022 Senior Notes”)
|
|
1,000
|
|
|
1,000
|
|
||
|
5.625% Senior Secured Notes due 2023 (“2023 Senior Notes”)
|
|
1,500
|
|
|
1,500
|
|
||
|
5.75% Senior Secured Notes due 2024 (“2024 Senior Notes”)
|
|
2,000
|
|
|
2,000
|
|
||
|
5.625% Senior Secured Notes due 2025 (“2025 Senior Notes”)
|
|
2,000
|
|
|
2,000
|
|
||
|
5.875% Senior Secured Notes due 2026 (“2026 Senior Notes”)
|
|
1,500
|
|
|
1,500
|
|
||
|
5.00% Senior Secured Notes due 2027 (“2027 Senior Notes”)
|
|
1,500
|
|
|
1,500
|
|
||
|
4.200% Senior Secured Notes due 2028 (“2028 Senior Notes”)
|
|
1,350
|
|
|
1,350
|
|
||
|
5.00% Senior Secured Notes due 2037 (“2037 Senior Notes”)
|
|
800
|
|
|
800
|
|
||
|
Unamortized discount, premium and debt issuance costs, net
|
|
(132
|
)
|
|
(150
|
)
|
||
|
Total long-term debt, net
|
|
13,518
|
|
|
13,500
|
|
||
|
|
|
|
|
|
||||
|
Current debt
|
|
|
|
|
||||
|
$1.2 billion Working Capital Facility (“Working Capital Facility”)
|
|
—
|
|
|
—
|
|
||
|
Total debt, net
|
|
$
|
13,518
|
|
|
$
|
13,500
|
|
|
|
Working Capital Facility (1)
|
||
|
Original facility size
|
$
|
1,200
|
|
|
Less:
|
|
||
|
Outstanding balance
|
—
|
|
|
|
Letters of credit issued
|
414
|
|
|
|
Available commitment
|
$
|
786
|
|
|
|
|
||
|
Interest rate on available balance
|
LIBOR plus 1.75% or base rate plus 0.75%
|
||
|
Maturity date
|
December 31, 2020
|
||
|
|
|
(1)
|
The Working Capital Facility was amended in May 2019 in connection with commercialization and financing of Train 6 of the Liquefaction Project. All terms of the Working Capital Facility substantially remained unchanged.
|
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
Total interest cost
|
|
$
|
198
|
|
|
$
|
198
|
|
|
$
|
593
|
|
|
$
|
594
|
|
|
Capitalized interest
|
|
(15
|
)
|
|
(52
|
)
|
|
(69
|
)
|
|
(149
|
)
|
||||
|
Total interest expense, net
|
|
$
|
183
|
|
|
$
|
146
|
|
|
$
|
524
|
|
|
$
|
445
|
|
|
|
|
September 30, 2019
|
|
December 31, 2018
|
||||||||||||
|
|
|
Carrying
Amount
|
|
Estimated
Fair Value
|
|
Carrying
Amount
|
|
Estimated
Fair Value
|
||||||||
|
Senior notes (1)
|
|
$
|
12,727
|
|
|
$
|
14,063
|
|
|
$
|
12,709
|
|
|
$
|
13,235
|
|
|
2037 Senior Notes (2)
|
|
791
|
|
|
909
|
|
|
791
|
|
|
817
|
|
||||
|
|
|
(1)
|
Includes 2021 Senior Notes, 2022 Senior Notes, 2023 Senior Notes, 2024 Senior Notes, 2025 Senior Notes, 2026 Senior Notes, 2027 Senior Notes and 2028 Senior Notes. The Level 2 estimated fair value was based on quotes obtained from broker-dealers or market makers of these senior notes and other similar instruments.
|
|
(2)
|
The Level 3 estimated fair value was calculated based on inputs that are observable in the market or that could be derived from, or corroborated with, observable market data, including interest rates based on debt issued by parties with comparable credit ratings to us and inputs that are not observable in the market.
|
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
LNG revenues
|
|
$
|
1,139
|
|
|
$
|
1,249
|
|
|
$
|
3,676
|
|
|
$
|
3,419
|
|
|
LNG revenues—affiliate
|
|
257
|
|
|
205
|
|
|
1,017
|
|
|
886
|
|
||||
|
Total revenues from customers
|
|
1,396
|
|
|
1,454
|
|
|
4,693
|
|
|
4,305
|
|
||||
|
Net derivative gains (1)
|
|
1
|
|
|
—
|
|
|
2
|
|
|
—
|
|
||||
|
Total revenues
|
|
$
|
1,397
|
|
|
$
|
1,454
|
|
|
$
|
4,695
|
|
|
$
|
4,305
|
|
|
|
|
(1)
|
|
|
|
Nine Months Ended September 30, 2019
|
||
|
Deferred revenues, beginning of period
|
|
$
|
91
|
|
|
Cash received but not yet recognized
|
|
148
|
|
|
|
Revenue recognized from prior period deferral
|
|
(91
|
)
|
|
|
Deferred revenues, end of period
|
|
$
|
148
|
|
|
|
|
September 30, 2019
|
|
December 31, 2018
|
||||||||
|
|
|
Unsatisfied
Transaction Price
(in billions)
|
|
Weighted Average Recognition Timing (years) (1)
|
|
Unsatisfied
Transaction Price (in billions) |
|
Weighted Average Recognition Timing (years) (1)
|
||||
|
LNG revenues (2)
|
|
$
|
55.7
|
|
|
10
|
|
$
|
53.6
|
|
|
10
|
|
|
|
(1)
|
The weighted average recognition timing represents an estimate of the number of years during which we shall have recognized half of the unsatisfied transaction price.
|
|
(2)
|
Includes future consideration from agreement contractually assigned to us from Cheniere Marketing.
|
|
(1)
|
We omit from the table above all performance obligations that are part of a contract that has an original expected duration of one year or less.
|
|
(2)
|
We omit from the table above all variable consideration that is allocated entirely to a wholly unsatisfied performance obligation or to a wholly unsatisfied promise to transfer a distinct good or service that forms part of a single performance obligation when that performance obligation qualifies as a series. The table above excludes substantially all variable consideration under our SPAs. The amount of revenue from variable fees that is not included in the transaction price will vary based on the future prices of Henry Hub throughout the contract terms, to the extent customers elect to take delivery of their LNG, and adjustments to the consumer price index. Approximately 49% and 55% of our LNG revenues during the three months ended September 30, 2019 and 2018, respectively, and approximately 53% and 55% of our LNG revenues during the nine months ended September 30, 2019 and 2018, respectively, were related to variable consideration received from customers. All of our LNG revenues—affiliate were related to variable consideration received from customers during each of the three and nine months ended September 30, 2019 and 2018.
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
|||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|||||||||
|
LNG revenues—affiliate
|
|
|
|
|
|
|
|
|||||||||
|
Cheniere Marketing Agreements
|
$
|
255
|
|
|
$
|
205
|
|
|
$
|
1,015
|
|
|
$
|
886
|
|
|
|
Contracts for Sale and Purchase of Natural Gas and LNG
|
2
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|||||
|
Total LNG revenues—affiliate
|
257
|
|
|
205
|
|
|
1,017
|
|
|
886
|
|
|||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Cost of sales—affiliate
|
|
|
|
|
|
|
|
|||||||||
|
Cargo loading fees under TUA
|
11
|
|
|
8
|
|
|
29
|
|
|
23
|
|
|||||
|
Contracts for Sale and Purchase of Natural Gas and LNG
|
6
|
|
|
—
|
|
|
6
|
|
|
—
|
|
|||||
|
Total cost of sales—affiliate
|
17
|
|
|
8
|
|
|
35
|
|
|
23
|
|
|||||
|
|
|
|
|
|
|
|
|
|||||||||
|
Operating and maintenance expense—affiliate
|
|
|
|
|
|
|
|
|||||||||
|
TUA
|
65
|
|
|
64
|
|
|
196
|
|
|
192
|
|
|||||
|
Natural Gas Transportation Agreement
|
20
|
|
|
20
|
|
|
60
|
|
|
61
|
|
|||||
|
Services Agreements
|
27
|
|
|
23
|
|
|
78
|
|
|
64
|
|
|||||
|
LNG Site Sublease Agreement
|
1
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|||||
|
Total operating and maintenance expense—affiliate
|
113
|
|
|
107
|
|
|
335
|
|
|
317
|
|
|||||
|
|
|
|
|
|
|
|
|
|||||||||
|
General and administrative expense—affiliate
|
|
|
|
|
|
|
|
|||||||||
|
Services Agreements
|
28
|
|
|
12
|
|
|
64
|
|
|
36
|
|
|||||
|
|
|
Percentage of Total Revenues from External Customers
|
|
Percentage of Accounts Receivable from External Customers
|
||||||||
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
|
September 30,
|
|
December 31,
|
||||
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
Customer A
|
|
25%
|
|
25%
|
|
30%
|
|
29%
|
|
21%
|
|
35%
|
|
Customer B
|
|
20%
|
|
22%
|
|
20%
|
|
24%
|
|
17%
|
|
23%
|
|
Customer C
|
|
24%
|
|
22%
|
|
21%
|
|
24%
|
|
15%
|
|
30%
|
|
Customer D
|
|
20%
|
|
25%
|
|
23%
|
|
20%
|
|
21%
|
|
*
|
|
Customer E
|
|
*
|
|
—%
|
|
*
|
|
—%
|
|
14%
|
|
—%
|
|
|
|
|
|
Nine Months Ended September 30,
|
||||||
|
|
|
2019
|
|
2018
|
||||
|
Cash paid during the period for interest, net of amounts capitalized
|
|
$
|
542
|
|
|
$
|
510
|
|
|
Non-cash distributions to affiliates for conveyance of assets
|
|
348
|
|
|
—
|
|
||
|
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;
|
|
•
|
statements 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 our 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 such 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-historical 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 May 2019, the board of directors of the general partner of Cheniere Partners made a positive final investment decision with respect to Train 6 of the Liquefaction Project and issued a full notice to proceed with construction to Bechtel Oil, Gas and Chemicals, Inc. (“Bechtel”) in June 2019.
|
|
•
|
As of October 25, 2019, approximately 800 cumulative LNG cargoes totaling approximately 55 million tonnes of LNG have been produced, loaded and exported from the Liquefaction Project.
|
|
•
|
In March 2019, we achieved substantial completion of Train 5 of the Liquefaction Project and commenced operating activities.
|
|
•
|
In September 2019, the date of first commercial delivery was reached under the 20-year SPAs with Centrica plc and Total Gas & Power North America, Inc. (“Total”) relating to Train 5 of the Liquefaction Project.
|
|
•
|
In March 2019, the date of first commercial delivery was reached under the 20-year SPA with BG Gulf Coast LNG, LLC relating to Train 4 of the Liquefaction Project.
|
|
|
September 30,
|
|
December 31,
|
||||
|
|
2019
|
|
2018
|
||||
|
Cash and cash equivalents
|
$
|
—
|
|
|
$
|
—
|
|
|
Restricted cash designated for the Liquefaction Project
|
185
|
|
|
756
|
|
||
|
Available commitments under the $1.2 billion Working Capital Facility (“Working Capital Facility”)
|
786
|
|
|
775
|
|
||
|
|
|
Train 6
|
|
|
Overall project completion percentage
|
|
38.1%
|
|
|
Completion percentage of:
|
|
|
|
|
Engineering
|
|
83.8%
|
|
|
Procurement
|
|
54.1%
|
|
|
Subcontract work
|
|
34.3%
|
|
|
Construction
|
|
5.5%
|
|
|
Date of expected substantial completion
|
|
1H 2023
|
|
|
•
|
Trains 1 through 4—FTA countries for a 30-year term, which commenced on May 15, 2016, and non-FTA countries for a 20-year term, which commenced on June 3, 2016, in an amount up to a combined total of the equivalent of 16 mtpa (approximately 803 Bcf/yr of natural gas).
|
|
•
|
Trains 1 through 4—FTA countries for a 25-year term and non-FTA countries for a 20-year term in an amount up to a combined total of the equivalent of approximately 203 Bcf/yr of natural gas (approximately 4 mtpa).
|
|
•
|
Trains 5 and 6—FTA countries and non-FTA countries for a 20-year term, in an amount up to a combined total of 503.3 Bcf/yr of natural gas (approximately 10 mtpa).
|
|
|
|
September 30,
|
|
December 31,
|
||||
|
|
|
2019
|
|
2018
|
||||
|
Senior notes (1)
|
|
$
|
13,650
|
|
|
$
|
13,650
|
|
|
Working Capital Facility outstanding balance
|
|
—
|
|
|
—
|
|
||
|
Letters of credit issued under Working Capital Facility
|
|
414
|
|
|
425
|
|
||
|
Available commitments under Working Capital Facility
|
|
786
|
|
|
775
|
|
||
|
Total capital resources from borrowings and available commitments
|
|
$
|
14,850
|
|
|
$
|
14,850
|
|
|
|
|
(1)
|
Includes 5.625% Senior Secured Notes due 2021, 6.25% Senior Secured Notes due 2022, 5.625% Senior Secured Notes due 2023, 5.75% Senior Secured Notes due 2024, 5.625% Senior Secured Notes due 2025, 5.875% Senior Secured Notes due 2026 (the “2026 Senior Notes”), 5.00% Senior Secured Notes due 2027 (the “2027 Senior Notes”), 4.200% Senior Secured Notes due 2028 (the “2028 Senior Notes”) and 5.00% Senior Secured Notes due 2037 (the “2037 Senior Notes”) (collectively, the “Senior Notes”).
|
|
|
|
Nine Months Ended September 30,
|
||||||
|
|
|
2019
|
|
2018
|
||||
|
Operating cash flows
|
|
$
|
656
|
|
|
$
|
928
|
|
|
Investing cash flows
|
|
(1,124
|
)
|
|
(554
|
)
|
||
|
Financing cash flows
|
|
(103
|
)
|
|
(269
|
)
|
||
|
|
|
|
|
|
||||
|
Net increase (decrease) in cash, cash equivalents and restricted cash
|
|
(571
|
)
|
|
105
|
|
||
|
Cash, cash equivalents and restricted cash—beginning of period
|
|
756
|
|
|
544
|
|
||
|
Cash, cash equivalents and restricted cash—end of period
|
|
$
|
185
|
|
|
$
|
649
|
|
|
•
|
$949 million of equity contributions from Cheniere Partners; and
|
|
•
|
$1,052 million of distributions to Cheniere Partners.
|
|
•
|
$81 million of equity contributions from Cheniere Partners; and
|
|
•
|
$350 million of distributions to Cheniere Partners.
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||
|
(in millions, except volumes)
|
2019
|
|
2018
|
|
Change
|
|
2019
|
|
2018
|
|
Change
|
||||||||||||
|
LNG revenues
|
$
|
1,140
|
|
|
$
|
1,249
|
|
|
$
|
(109
|
)
|
|
$
|
3,678
|
|
|
$
|
3,419
|
|
|
$
|
259
|
|
|
LNG revenues—affiliate
|
257
|
|
|
205
|
|
|
52
|
|
|
1,017
|
|
|
886
|
|
|
131
|
|
||||||
|
Total revenues
|
$
|
1,397
|
|
|
$
|
1,454
|
|
|
$
|
(57
|
)
|
|
$
|
4,695
|
|
|
$
|
4,305
|
|
|
$
|
390
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
LNG volumes recognized as revenues (in TBtu)
|
277
|
|
|
228
|
|
|
49
|
|
|
845
|
|
|
691
|
|
|
154
|
|
||||||
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||
|
(in millions)
|
2019
|
|
2018
|
|
Change
|
|
2019
|
|
2018
|
|
Change
|
||||||||||||
|
Cost of sales
|
$
|
742
|
|
|
$
|
758
|
|
|
$
|
(16
|
)
|
|
$
|
2,501
|
|
|
$
|
2,291
|
|
|
$
|
210
|
|
|
Cost of sales—affiliate
|
17
|
|
|
8
|
|
|
9
|
|
|
35
|
|
|
23
|
|
|
12
|
|
||||||
|
Operating and maintenance expense
|
150
|
|
|
96
|
|
|
54
|
|
|
398
|
|
|
258
|
|
|
140
|
|
||||||
|
Operating and maintenance expense—affiliate
|
113
|
|
|
107
|
|
|
6
|
|
|
335
|
|
|
317
|
|
|
18
|
|
||||||
|
Development expense
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
(1
|
)
|
||||||
|
General and administrative expense
|
1
|
|
|
1
|
|
|
—
|
|
|
4
|
|
|
4
|
|
|
—
|
|
||||||
|
General and administrative expense—affiliate
|
28
|
|
|
12
|
|
|
16
|
|
|
64
|
|
|
36
|
|
|
28
|
|
||||||
|
Depreciation and amortization expense
|
117
|
|
|
88
|
|
|
29
|
|
|
331
|
|
|
261
|
|
|
70
|
|
||||||
|
Impairment expense and loss on disposal of assets
|
1
|
|
|
—
|
|
|
1
|
|
|
6
|
|
|
—
|
|
|
6
|
|
||||||
|
Total operating costs and expenses
|
$
|
1,169
|
|
|
$
|
1,070
|
|
|
$
|
99
|
|
|
$
|
3,674
|
|
|
$
|
3,191
|
|
|
$
|
483
|
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||
|
(in millions)
|
2019
|
|
2018
|
|
Change
|
|
2019
|
|
2018
|
|
Change
|
||||||||||||
|
Interest expense, net of capitalized interest
|
$
|
183
|
|
|
$
|
146
|
|
|
$
|
37
|
|
|
$
|
524
|
|
|
$
|
445
|
|
|
$
|
79
|
|
|
Other income
|
(3
|
)
|
|
(5
|
)
|
|
2
|
|
|
(9
|
)
|
|
(9
|
)
|
|
—
|
|
||||||
|
Total other expense
|
$
|
180
|
|
|
$
|
141
|
|
|
$
|
39
|
|
|
$
|
515
|
|
|
$
|
436
|
|
|
$
|
79
|
|
|
ITEM 3.
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
|
|
September 30, 2019
|
|
December 31, 2018
|
||||||||||||
|
|
Fair Value
|
|
Change in Fair Value
|
|
Fair Value
|
|
Change in Fair Value
|
||||||||
|
Liquefaction Supply Derivatives
|
$
|
(24
|
)
|
|
$
|
6
|
|
|
$
|
(43
|
)
|
|
$
|
7
|
|
|
PART II.
|
OTHER INFORMATION
|
|
ITEM 1.
|
LEGAL PROCEEDINGS
|
|
ITEM 1A.
|
RISK FACTORS
|
|
Exhibit No.
|
|
Description
|
|
10.1*
|
|
|
|
31.1*
|
|
|
|
31.2*
|
|
|
|
32.1**
|
|
|
|
32.2**
|
|
|
|
101.INS*
|
|
XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
|
|
101.SCH*
|
|
Inline XBRL Taxonomy Extension Schema Document
|
|
101.CAL*
|
|
Inline XBRL Taxonomy Extension Calculation Linkbase Document
|
|
101.DEF*
|
|
Inline XBRL Taxonomy Extension Definition Linkbase Document
|
|
101.LAB*
|
|
Inline XBRL Taxonomy Extension Labels Linkbase Document
|
|
101.PRE*
|
|
Inline XBRL Taxonomy Extension Presentation Linkbase Document
|
|
104*
|
|
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)
|
|
|
|
|
|
|
|
*
|
Filed herewith.
|
|
**
|
Furnished herewith.
|
|
|
|
SABINE PASS LIQUEFACTION, LLC
|
|
|
|
|
|
|
|
Date:
|
October 31, 2019
|
By:
|
/s/ Michael J. Wortley
|
|
|
|
|
Michael J. Wortley
|
|
|
|
|
Chief Financial Officer
|
|
|
|
|
(on behalf of the registrant and
as principal financial officer) |
|
|
|
|
|
|
Date:
|
October 31, 2019
|
By:
|
/s/ Leonard E. Travis
|
|
|
|
|
Leonard E. Travis
|
|
|
|
|
Chief Accounting Officer
|
|
|
|
|
(on behalf of the registrant and
as principal accounting officer) |
|
PROJECT NAME: Sabine Pass LNG Stage 4 Liquefaction Facility
OWNER: Sabine Pass Liquefaction, LLC
CONTRACTOR: Bechtel Oil, Gas and Chemicals, Inc.
DATE OF AGREEMENT: November 7, 2018
|
CHANGE ORDER NUMBER: CO-00002
DATE OF CHANGE ORDER: July 8, 2019
|
|
1.
|
The Fuel Provisional Sum in Article 1.2 of Attachment EE, Schedule EE-1 of the Agreement prior to this Change Order was Nine Million, Two Hundred Twenty-One Thousand, Seven Hundred Seventy-Four U.S. Dollars (U.S. $9,221,774). The Provisional Sum is hereby increased by Three Hundred Eighty-Nine Thousand Two Hundred Fifty-Seven U.S. Dollars (U.S. $389,257), and the final value as amended by this Change Order shall be Nine Million, Six Hundred Eleven Thousand Thirty-One U.S. Dollars (U.S. $9,611,031). This Change Order closes the Fuel Provisional Sum in accordance with Article 1.2 of Attachment EE, Schedule EE-1 of the Agreement.
|
|
2.
|
Pursuant to instructions in Article 1.2 of Attachment EE, Schedule EE-1 of the Agreement, Exhibit A to this Change Order illustrates the calculation of the final fuel costs in the Agreement.
|
|
3.
|
Schedules C-1 and C-2 (Milestone Payment Schedule) of Attachment C of the Agreement will be amended by including the milestones listed in Exhibit B of this Change Order.
|
|
The original Contract Price was.........................................................................................................................
|
$
|
2,016,892,573
|
|
|
Net change by previously authorized Change Orders (CO-00001)...................................................................
|
$
|
—
|
|
|
The Contract Price prior to this Change Order was...........................................................................................
|
$
|
2,016,892,573
|
|
|
The Contract Price Applicable to Subproject 6(a) will be increased by this Change Order in the amount of..
|
$
|
389,257
|
|
|
The Contract Price Applicable to Subproject 6(b) will be unchanged by this Change Order in the amount of
|
$
|
—
|
|
|
The Provisional Sum will be increased by this Change Order in the amount of...............................................
|
$
|
389,257
|
|
|
The Contract Price will be increased by this Change Order in the amount of...................................................
|
$
|
389,257
|
|
|
The new Contract Price including this Change Order will be...........................................................................
|
$
|
2,017,281,830
|
|
|
/s/ David Craft
|
|
/s/ Maurissa D. Rogers
|
|
Owner
|
|
Contractor
|
|
David Craft
|
|
Maurissa D. Rogers
|
|
Name
|
|
Name
|
|
SVP E&C
|
|
Sr Project Manager, PVP
|
|
Title
|
|
Title
|
|
July 8, 2019
|
|
July 8, 2019
|
|
Date of Signing
|
|
Date of Signing
|
|
PROJECT NAME: Sabine Pass LNG Stage 4 Liquefaction Facility
OWNER: Sabine Pass Liquefaction, LLC
CONTRACTOR: Bechtel Oil, Gas and Chemicals, Inc.
DATE OF AGREEMENT: November 7, 2018
|
CHANGE ORDER NUMBER: CO-00003
DATE OF CHANGE ORDER: July 8, 2019
|
|
1.
|
The Currency Provisional Sum in Article 1.1 of Attachment EE, Schedule EE-1 of the Agreement prior to this Change Order was One Hundred Ninety-Six Million, Three Hundred Twenty-Five Thousand, Four Hundred Thirty-Nine U.S. Dollars (U.S. $196,325,439). The Currency Provisional Sum is hereby decreased by Six Million, Nine Hundred Fifty-Four Thousand, Five Hundred Seventy-Nine U.S. Dollars (U.S. $6,954,579) and the final value as amended by this Change Order shall be One Hundred Eighty-Nine Million, Three Hundred Seventy Thousand, Eight Hundred Sixty U.S. Dollars (U.S. $189,370,860). This Change Order closes the Currency Provisional Sum in accordance with Article 1.1 of Attachment EE, Schedule EE-1 of the Agreement.
|
|
2.
|
Pursuant to instructions in Article 1.1 of Attachment EE, Schedule EE-1 of the Agreement, Exhibit A to this Change Order illustrates the calculation of the final currency costs in the Agreement.
|
|
3.
|
Exhibit C of this Change Order includes the detailed spot and forward trades used to calculate the final currency costs in the Agreement.
|
|
4.
|
Schedules C-1 and C-2 (Milestone Payment Schedule) of Attachment C of the Agreement will be amended by including the milestones listed in Exhibit B of this Change Order.
|
|
The original Contract Price was.........................................................................................................................
|
$
|
2,016,892,573
|
|
|
Net change by previously authorized Change Orders (00001-00002)...............................................................
|
$
|
389,257
|
|
|
The Contract Price prior to this Change Order was...........................................................................................
|
$
|
2,017,281,830
|
|
|
The Contract Price Applicable to Subproject 6(a) will be decreased by this Change Order in the amount of..
|
$
|
(6,954,579
|
)
|
|
The Contract Price Applicable to Subproject 6(b) will be unchanged by this Change Order in the amount of
|
$
|
—
|
|
|
The Provisional Sum will be decreased by this Change Order in the amount of..............................................
|
$
|
(6,954,579
|
)
|
|
The Contract Price will be decreased by this Change Order in the amount of..................................................
|
$
|
(6,954,579
|
)
|
|
The new Contract Price including this Change Order will be...........................................................................
|
$
|
2,010,327,251
|
|
|
/s/ David Craft
|
|
/s/ Maurissa D. Rogers
|
|
Owner
|
|
Contractor
|
|
David Craft
|
|
Maurissa D. Rogers
|
|
Name
|
|
Name
|
|
SVP E&C
|
|
Sr Project Manager, PVP
|
|
Title
|
|
Title
|
|
July 17, 2019
|
|
July 8, 2019
|
|
Date of Signing
|
|
Date of Signing
|
|
PROJECT NAME: Sabine Pass LNG Stage 4 Liquefaction Facility
OWNER: Sabine Pass Liquefaction, LLC
CONTRACTOR: Bechtel Oil, Gas and Chemicals, Inc.
DATE OF AGREEMENT: November 7, 2018
|
CHANGE ORDER NUMBER: CO-00004
DATE OF CHANGE ORDER: July 2, 2019
|
|
1.
|
The purpose of this CO-00004 (the “Change Order”) is, subject to the terms of the Agreement and those described herein, to grant Contractor the use of Foreign-Trade Zone No. 291 in Cameron, Louisiana (the “FTZ”), which is more specifically defined in Exhibit A, (the “Zone Site”). The Cameron Port Commission was awarded a grant of authority by the United States Foreign-Trade Zones Board (the “FTZ Board”) to establish, operate and maintain the FTZ and has designated Cheniere Energy Partners, LP (“Cheniere”) to oversee the operations of the Zone Site as the Zone Operator, within the meaning of the Foreign Trade Zones Act of 1934, 19 U.S.C. Sec. 81 et. seq., as amended, and 19 C.F.R. Section 146.4, and with respect to procedures and activities occurring at the Zone Site. Owner is authorized to use the FTZ pursuant to the FTZ user agreement by and between Cheniere and Owner, which also expressly authorizes Owner to permit Contractor to use the FTZ.
|
|
2.
|
Compliance with Laws: Subject to Section 6.2A.1 and 6.9 of the Agreement if a Change in Law occurs after the date of this Change Order, each Party shall perform its obligations under this Change Order in a manner consistent with good business practices and in full compliance with the Foreign-Trade Zones Act and any regulations adopted by the FTZ Board thereunder, the laws, and regulations governing the U.S. Customs and Border Protection (the “CBP”), and any applicable laws of the State of Louisiana and the United States of America, as in existence, or enacted, or amended during the term of the Agreement (collectively, “Applicable Authority”).
|
|
3.
|
Contractor Responsibilities: Contractor’s responsibilities with respect to the FTZ operations at the Zone Site include, but are not limited to:
|
|
•
|
Zone Site maintenance of an inventory control and recordkeeping system that meets the requirements of Applicable Authority;
|
|
•
|
Preparation and submission of the in-bond filing to move imported materials from the Port of Arrival to the Zone Site;
|
|
•
|
Within four (4) Business Days of the departure date of any shipment of materials destined for the FTZ, provision of copies of the in-bond filing and supporting documentation to the Owner and/or Owner’s tax consultant, including, but not limited to the bill of lading for such shipment;
|
|
•
|
Preparation and submission of all FTZ-related forms with CBP (including admissions, transfers, and removals to or from the Zone Site), ensuring accurate and complete reporting of information;
|
|
•
|
Provision of copies of all filings with CBP and supporting documentation, including, but not limited to, the following:
|
|
◦
|
For materials placed into commerce at frontier (i.e., materials admitted for consumption):
|
|
▪
|
Contractor shall provide Owner and/or Owner’s tax consultant with copies of CBP Form 7501 on or before the fourth (4th) business day following the entry date of any such shipment reported on CBP Form 7501;
|
|
◦
|
For any shipment of materials transported in-bond:
|
|
▪
|
Contractor shall provide Owner and/or Owner’s tax consultant with copies of CBP Form 7512 on or before the fourth (4th) business day following the entry date of any such shipment reported on CBP Form 7512
|
|
▪
|
Contractor shall provide Owner and/or Owner’s tax consultant with copies of CBP Form 214 on or before the tenth (10th) business day following the entry date of any such shipment reported on CBP Form 214
|
|
◦
|
For any materials in foreign-privilege status subsequently admitted into commerce for consumption:
|
|
▪
|
Contractor shall provide Owner and/or Owner’s tax consultant with copies of CBP Form 7501 on or before the fourth (4th) business day following the entry date of any such admitted materials as reported on CBP Form 7501
|
|
•
|
Following removal of materials from the Zone Site, payment to CBP of all import duties and tariffs due on such removal;
|
|
•
|
On a weekly basis, provision of inventory reports for all materials located at the Zone Site, including designation of materials admitted for consumption and materials admitted in foreign status;
|
|
•
|
Provision of necessary information to Owner for its preparation and filing of the annual report to the FTZ Board; and
|
|
•
|
Assistance during any compliance review from CBP, as requested by Owner.
|
|
4.
|
US Customs and Border Protection: Contractor and Owner acknowledge and agree that a good working relationship with CBP is essential to an effective operation of a Foreign-Trade Zone and each Party shall use reasonable commercials efforts to maintain such a relationship. Contractor agrees to perform its duties and responsibilities in full cooperation with CBP.
|
|
5.
|
Records: Parties shall maintain all books and records in connection with their responsibilities under this Change Order for a minimum term of five (5) years. Owner shall maintain its books and records for five (5) years after the materials have been removed from the Zones Site. Contractor shall keep and make available to Owner such books and records during the term of this Agreement and for a period of two (2) years thereafter or such greater period as may be required under Applicable Authority. The record keeping requirements shall survive the termination or expiration of the Agreement.
|
|
6.
|
Documentation upon Expiration or Termination: At the expiration or termination of Contractor’s use of the FTZ for any reason, Contractor shall promptly provide to Owner all pertinent records and documents maintained by Contractor and needed by Owner in connection with the operation of the Zone Site. In addition, Contractor, shall provide assistance and information as reasonably requested by Owner in order to ensure a compliant transition of all documentation and reporting requirement under Applicable Authority. This provision shall survive the expiration or termination of the Contractor’s right to use the FTZ.
|
|
7.
|
Additional Cost for Complying with FTZ: Owner agrees that Contractor shall have the right to recover additional, reasonable costs associated with compliance with the FTZ requirements.
|
|
The original Contract Price was.........................................................................................................................
|
$
|
2,016,892,573
|
|
|
Net change by previously authorized Change Orders (CO-00003)...................................................................
|
$
|
(6,565,322
|
)
|
|
The Contract Price prior to this Change Order was...........................................................................................
|
$
|
2,010,327,251
|
|
|
The Contract Price Applicable to Subproject 6(a) will be unchanged by this Change Order in the amount of........................................................................................................................................................................
|
$
|
—
|
|
|
The Contract Price Applicable to Subproject 6(b) will be unchanged by this Change Order in the amount of
|
$
|
—
|
|
|
The Provisional Sum will be unchanged by this Change Order in the amount of.............................................
|
$
|
—
|
|
|
The Contract Price will be unchanged by this Change Order in the amount of................................................
|
$
|
—
|
|
|
The new Contract Price including this Change Order will be...........................................................................
|
$
|
2,010,327,251
|
|
|
/s/ David Craft
|
|
/s/ Maurissa D. Rogers
|
|
Owner
|
|
Contractor
|
|
David Craft
|
|
Maurissa D. Rogers
|
|
Name
|
|
Name
|
|
SVP E&C
|
|
Sr Project Mgr, PVP
|
|
Title
|
|
Title
|
|
July 30, 2019
|
|
July 2, 2019
|
|
Date of Signing
|
|
Date of Signing
|
|
PROJECT NAME: Sabine Pass LNG Stage 4 Liquefaction Facility
OWNER: Sabine Pass Liquefaction, LLC
CONTRACTOR: Bechtel Oil, Gas and Chemicals, Inc.
DATE OF AGREEMENT: November 7, 2018
|
CHANGE ORDER NUMBER: CO-00005
DATE OF CHANGE ORDER: July 17, 2019
|
|
1.
|
In accordance with Article 6.1.B (Change Orders Requested by Owner), the Parties agree this Change Order implements a new Provisional Sum for Contractor to provide twenty-four (24) hours a day, seven (7) days a Week perimeter security and access coordination of the Duck Blind Road entrance to support Natural Gas Pipeline Company of America (“NGPL”) work at the Stage 4 Liquefaction Facility for an estimated duration of one (1) year upon commencement of the work by NGPL.
|
|
A.
|
Owner’s original request for Contractor to provide gate access security for NGPL, including the scope of work, is documented under Owner Correspondence No. SPL4-BE-C19-009, Subject: Cooperation and Coordination with NGPL Work, dated 6 May 2019, is attached to this Change Order as Exhibit C.
|
|
B.
|
Owner’s subsequent request for increased gate access security for a one-year duration is documented under Owner email correspondence Subject: NGPL Project - Bechtel 24/7 Security, dated 26 June 2019, is attached to this Change Order as Exhibit D.
|
|
C.
|
Contractor’s acknowledgement of Owner’s request is documented under Contractor Correspondence No. 26012-100-T19-GAM-00021, Subject: Cooperation and Coordination with NGPL Work, dated 8 May 2019, is attached to this Change Order as Exhibit E.
|
|
2.
|
Section EE-2 (Provisional Sums to be Adjusted during Project Execution) of Attachment EE (Provisional Sums) of the Agreement shall be amended by adding the new Provisional Sum under Section 2.4 as, “NGPL Security Coordination Provisional Sum” as follows:
|
|
3.
|
The estimate basis for this new Provisional Sum 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 final value will be trued-up on a separate Change Order based on the actual costs to close the NGPL Gate Access Security Provisional Sum.
|
|
The original Contract Price was.........................................................................................................................
|
$
|
2,016,892,573
|
|
|
Net change by previously authorized Change Orders (00001-00004)...............................................................
|
$
|
(6,565,322
|
)
|
|
The Contract Price prior to this Change Order was...........................................................................................
|
$
|
2,010,327,251
|
|
|
The Contract Price Applicable to Subproject 6(a) will be increased by this Change Order in the amount of........................................................................................................................................................................
|
$
|
232,158
|
|
|
The Contract Price Applicable to Subproject 6(b) will be unchanged by this Change Order in the amount of
|
$
|
—
|
|
|
The Provisional Sum will be increased by this Change Order in the amount of...............................................
|
$
|
232,158
|
|
|
The Contract Price will be increased by this Change Order in the amount of...................................................
|
$
|
232,158
|
|
|
The new Contract Price including this Change Order will be...........................................................................
|
$
|
2,010,559,409
|
|
|
/s/ David Craft
|
|
/s/ Maurissa Douglas Rogers
|
|
Owner
|
|
Contractor
|
|
David Craft
|
|
Maurissa Douglas Rogers
|
|
Name
|
|
Name
|
|
SVP Engineering & Construction
|
|
Sr Project Mgr, PVP
|
|
Title
|
|
Title
|
|
August 4, 2019
|
|
July 17, 2019
|
|
Date of Signing
|
|
Date of Signing
|
|
PROJECT NAME: Sabine Pass LNG Stage 4 Liquefaction Facility
OWNER: Sabine Pass Liquefaction, LLC
CONTRACTOR: Bechtel Oil, Gas and Chemicals, Inc.
DATE OF AGREEMENT: November 7, 2018
|
CHANGE ORDER NUMBER: CO-00006
DATE OF CHANGE ORDER: August 14, 2019
|
|
1.
|
In accordance with Article 6.1.B (Change Orders Requested by Owner), the Parties agree this Change Order includes costs for Contractor to purchase the 600# Triple Offset Manual and Automated On/Off Valves from Emerson Vanessa in lieu of Adams Valves Inc. Direction provided in Owner’s Letter No. SPL4-BE-C19-007, dated March 25, 2019.
|
|
2.
|
The detailed cost summary for this Change Order is included 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.........................................................................................................................
|
$
|
2,016,892,573
|
|
|
Net change by previously authorized Change Orders (00001-00005)...............................................................
|
$
|
(6,333,164
|
)
|
|
The Contract Price prior to this Change Order was...........................................................................................
|
$
|
2,010,559,409
|
|
|
The Contract Price Applicable to Subproject 6(a) will be increased by this Change Order in the amount of........................................................................................................................................................................
|
$
|
289,111
|
|
|
The Contract Price Applicable to Subproject 6(b) will be unchanged by this Change Order in the amount of
|
$
|
—
|
|
|
The Provisional Sum will be increased by this Change Order in the amount of...............................................
|
$
|
—
|
|
|
The Contract Price will be increased by this Change Order in the amount of...................................................
|
$
|
289,111
|
|
|
The new Contract Price including this Change Order will be...........................................................................
|
$
|
2,010,848,520
|
|
|
/s/ David Craft
|
|
/s/ Maurissa Douglas Rogers
|
|
Owner
|
|
Contractor
|
|
David Craft
|
|
Maurissa Douglas Rogers
|
|
Name
|
|
Name
|
|
SVP E&C
|
|
Sr Project Mgr, PVP
|
|
Title
|
|
Title
|
|
August 28, 2019
|
|
August 14, 2019
|
|
Date of Signing
|
|
Date of Signing
|
|
PROJECT NAME: Sabine Pass LNG Stage 4 Liquefaction Facility
OWNER: Sabine Pass Liquefaction, LLC
CONTRACTOR: Bechtel Oil, Gas and Chemicals, Inc.
DATE OF AGREEMENT: November 7, 2018
|
CHANGE ORDER NUMBER: CO-00007
DATE OF CHANGE ORDER: August 14, 2019
|
|
1.
|
In accordance with Article 6.1.B (Change Orders Requested by Owner), the Parties agree this Change Order includes costs for Contractor to add a permanent drain pipe from E-1503 to Heavies Removal Unit (HRU) as requested by Owner in Letter No. SPL4-BE-C19-005, dated March 14, 2019.
|
|
2.
|
The detailed cost summary for this Change Order is included 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.
|
|
4.
|
The updated Piping & Instrumentation Diagram (P&ID) is provided in Exhibit C of this Change Order.
|
|
The original Contract Price was.........................................................................................................................
|
$
|
2,016,892,573
|
|
|
Net change by previously authorized Change Orders (00001-00006)...............................................................
|
$
|
(6,044,053
|
)
|
|
The Contract Price prior to this Change Order was...........................................................................................
|
$
|
2,010,848,520
|
|
|
The Contract Price Applicable to Subproject 6(a) will be increased by this Change Order in the amount of........................................................................................................................................................................
|
$
|
1,205,234
|
|
|
The Contract Price Applicable to Subproject 6(b) will be unchanged by this Change Order in the amount of
|
$
|
—
|
|
|
The Provisional Sum will be increased by this Change Order in the amount of...............................................
|
$
|
—
|
|
|
The Contract Price will be increased by this Change Order in the amount of...................................................
|
$
|
1,205,234
|
|
|
The new Contract Price including this Change Order will be...........................................................................
|
$
|
2,012,053,754
|
|
|
/s/ David Craft
|
|
/s/ Maurissa D. Rogers
|
|
Owner
|
|
Contractor
|
|
David Craft
|
|
Maurissa D. Rogers
|
|
Name
|
|
Name
|
|
SVP E&C
|
|
Sr Project Mgr, PVP
|
|
Title
|
|
Title
|
|
August 28, 2019
|
|
August 14, 2019
|
|
Date of Signing
|
|
Date of Signing
|
|
PROJECT NAME: Sabine Pass LNG Stage 4 Liquefaction Facility
OWNER: Sabine Pass Liquefaction, LLC
CONTRACTOR: Bechtel Oil, Gas and Chemicals, Inc.
DATE OF AGREEMENT: November 7, 2018
|
CHANGE ORDER NUMBER: CO-00008
DATE OF CHANGE ORDER: August 27, 2019
|
|
1.
|
In accordance with Article 6 of the Agreement, Parties agree Contractor will be compensated for the costs associated with the additional piling Works due to encountered Subsurface Soil Conditions in Train 6 ISBL area that differ from the Design Basis of the Agreement.
|
|
A.
|
Contractor analyzed the differing subsurface soil conditions in Train 6 ISBL areas. This Change order captures the cost impacts associated with the additional testing required to support analysis, resulting remediation work throughout Train 6 ISBL and the piles and tension connectors added to the following Train 6 ISBL areas: A01, B01, D01, F01, G01, H01, K01, L01 and N02. Refer to Exhibit C of this Change Order for the ISBL Plot Plan highlighting areas with additional piles.
|
|
B.
|
The piling Works scope is complete in the Train 6 ISBL at the time of this Change Order. Should additional differing Subsurface Soil Conditions be encountered in Train 6 ISBL areas unrelated to the piling Works, or should differing Subsurface Soil Conditions be encountered outside the Train 6 ISBL areas, such conditions will be addressed in a future Change Order in accordance with the terms of the Agreement.
|
|
2.
|
The detailed cost summary for this Change Order is included 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.........................................................................................................................
|
$
|
2,016,892,573
|
|
|
Net change by previously authorized Change Orders (00001-00007)...............................................................
|
$
|
(4,838,819
|
)
|
|
The Contract Price prior to this Change Order was...........................................................................................
|
$
|
2,012,053,754
|
|
|
The Contract Price Applicable to Subproject 6(a) will be increased by this Change Order in the amount of........................................................................................................................................................................
|
$
|
1,467,978
|
|
|
The Contract Price Applicable to Subproject 6(b) will be unchanged by this Change Order in the amount of
|
$
|
—
|
|
|
The Provisional Sum will be increased by this Change Order in the amount of...............................................
|
$
|
—
|
|
|
The Contract Price will be increased by this Change Order in the amount of...................................................
|
$
|
1,467,978
|
|
|
The new Contract Price including this Change Order will be...........................................................................
|
$
|
2,013,521,732
|
|
|
/s/ David Craft
|
|
/s/ Maurissa D. Rogers
|
|
Owner
|
|
Contractor
|
|
David Craft
|
|
Maurissa D. Rogers
|
|
Name
|
|
Name
|
|
SVP E&C
|
|
Sr Project Mgr, PVP
|
|
Title
|
|
Title
|
|
September 4, 2019
|
|
August 27, 2019
|
|
Date of Signing
|
|
Date of Signing
|
|
PROJECT NAME: Sabine Pass LNG Stage 4 Liquefaction Facility
OWNER: Sabine Pass Liquefaction, LLC
CONTRACTOR: Bechtel Oil, Gas and Chemicals, Inc.
DATE OF AGREEMENT: November 7, 2018
|
CHANGE ORDER NUMBER: CO-00009
DATE OF CHANGE ORDER: September 25, 2019
|
|
1.
|
Per Section 4.10 of the Agreement, the Parties agree this LNG Berth 3 Change Order (“Change Order”) constitutes Owner’s Option for Contractor to perform the engineering, procurement, construction, pre-commissioning, commissioning, testing and startup of Subproject 6(b).
|
|
2.
|
This Change Order is based on Owner’s issuance of the LNTPs and NTP as follows:
|
|
a.
|
LNTP No. 1 for Subproject 6(b): Owner released Contractor to perform home office services through an initial Limited Notice to Proceed (“LNTP No. 1 for Subproject 6(b)”), under a Request for Services dated April 1, 2019 (“RFS No. 129378”), pursuant to the Technical Services Agreement dated February 28, 2018, between Sabine Pass Liquefaction, LLC and Contractor. This work is focused on engineering and other home office activities required to prepare for the necessary commitments under LNTP No. 2 for Subproject 6(b) and post-NTP for Subproject 6(b).
|
|
b.
|
LNTP No. 2 for Subproject 6(b): No later than October 1, 2019, Owner will release Contractor to perform pre-NTP activities for Subproject 6(b) through a second LNTP (“LNTP No. 2 for Subproject 6(b)”) in the form of Schedule H-7, as attached hereto. The scope under this LNTP No. 2 for Subproject 6(b) shall consist of the procurement of key Equipment (including bulk materials) and release of key Subcontracts, as further described in Schedule H-7. If Owner does not issue LNTP No. 2 for Subproject 6(b) on or before October 1, 2019, then Contractor shall be entitled to an adjustment to the Contract Price Applicable to Subproject 6(b) and the Guaranteed Substantial Completion Date for Subproject 6(b) if and to the extent caused by such delayed issuance of LNTP No. 2 for Subproject 6(b). Such adjustment shall include cost impacts caused by, for example, closing of vendor shops, unavailability of materials, labor unavailability, impacts on ability to attract and/or retain qualified labor, as well as escalation and loss of synergies with Contractor’s performance of Work for Subproject 6(a). For the avoidance of doubt, any adjustment to the Contract Price Applicable to Subproject 6(b) or the Project Schedule for Subproject 6(b) shall not be based on Contractor’s errors or omissions, a change in technology, or a change in material or Equipment quantities (except where the unavailability of materials, vendors or labor caused by such delayed issuance of LNTP No. 2 for Subproject 6(b) results in necessary changes to Equipment specifications). Contractor shall use commercially reasonable efforts and GECP to mitigate (i) the increase to the Contract Price Applicable to Subproject 6(b) and (ii) any adverse impact to the Project Schedule for Subproject 6(b). Such agreed-upon adjustment will be set forth in a Change Order.
|
|
c.
|
NTP for Subproject 6(b): No later than January 31, 2020, Owner shall issue NTP for Subproject 6(b) to Contractor for all remaining Work for the LNG Berth 3 in the form of Schedule H-3 to the Agreement. On or before issuance of NTP for Subproject 6(b), Contractor shall deliver to Owner a Letter of Credit for Subproject 6(b) in accordance with Section 9.2 of the Agreement. If Owner does not issue NTP for Subproject 6(b) on or before January 31, 2020, then Contractor shall be entitled to an adjustment to the Contract Price Applicable to Subproject 6(b) and the Guaranteed Substantial Completion Date for Subproject 6(b) if and to the extent caused by such delayed issuance of NTP for Subproject 6(b). Such adjustment shall be in accordance with Section 5.2C.2 of the Agreement.
|
|
3.
|
The Contract Price Applicable to Subproject 6(b) is Four Hundred Fifty-Seven Million Six Hundred Ninety-Six Thousand U.S. Dollars (U.S.$457,696,000). The breakdown of the Contract Price Applicable to Subproject 6(b) is detailed in Exhibit 1 of this Change Order. The Contract Price Applicable to Subproject 6(b) includes any Provisional Sums applicable to Subproject 6(b).
|
|
4.
|
The Parties hereby delete Section 20.2A of the Agreement in its entirety and replace it with the following:
|
|
“
|
A. Delay Liquidated Damages. Subject to Section 20.2C, Contractor’s maximum liability to Owner for (i) Subproject 6(a) Delay Liquidated Damages is Ninety Million U.S. Dollars (U.S.$90,000,000), in the aggregate, and (ii) Subproject 6(b) Delay Liquidated Damages is Twenty Million Five Hundred Ninety-Six Thousand Three Hundred Twenty U.S. Dollars (U.S.$20,596,320), in the aggregate.”
|
|
5.
|
Per Section 13.2C of the Agreement, the Schedule Bonus Date for SP6(b)” and “Schedule Bonus for SP6(b)” shall be as follows:
|
|
a.
|
The “Schedule Bonus Date for SP6(b)” shall be either: (i) April 16, 2023, provided Owner issues NTP for Subproject 6(b) on or before January 31, 2020; or (ii) the date that is one thousand one hundred seventy-two (1172) Days from NTP for Subproject 6(b) if Owner issues NTP for Subproject 6(b) after January 31, 2020.
|
|
b.
|
If Substantial Completion of Subproject 6(b) occurs before the Guaranteed Substantial Completion Date for SP6(b), and Contractor achieves Ready for Reduced Ship Loading prior to the Schedule Bonus Date for SP6(b), then Owner shall pay Contractor a bonus as set forth in this Section 5 (the “Schedule Bonus for SP6(b)”).
|
|
c.
|
Notwithstanding anything to the contrary, the aggregate amount payable by Owner to Contractor under the Agreement for such Schedule Bonus for SP6(b) shall not exceed Fifteen Million U.S. Dollars (U.S.$15,000,000).
|
|
d.
|
“Ready for Reduced Ship Loading” means that Subproject 6(b): (i) has achieved on average over a period of ten (10) continuous hours, a ship loading rate of at least 8,000m3 per hour for the transfer of LNG to an LNG Tanker (and return of vapor and boil-off gas to the LNG Tanks) using a single berth only and in accordance with the Ship Loading Time Conditions and testing procedures in Section 3.11.3 of Attachment S of the Agreement; and (ii) fully loaded such LNG Tanker (unless otherwise instructed by Owner).
|
|
e.
|
Contractor shall give Owner one hundred eighty (180) Days’ prior written notice specifying the date on which Contractor expects Subproject 6(b) to be Ready for Reduced Ship Loading. Contractor shall give Owner a second written notice specifying the date on which Contractor expects Subproject 6(b) to be Ready for Reduced Ship Loading, which notice shall be given no later than one hundred twenty (120) Days prior to such date. Contractor shall give Owner a third written notice specifying the date on which Contractor expects Subproject 6(b) to be Ready for Reduced Ship Loading, which notice shall be given no later than sixty (60) Days prior to such date. Owner shall use commercially reasonable efforts to provide an LNG Tanker no earlier than seven (7) Days prior to and no later than seven (7) Days after the date in such third written notice. Owner shall also use commercially reasonable efforts to provide LNG for Contractor to load onto the LNG Tanker.
|
|
f.
|
Contractor shall have forty-eight (48) hours after the LNG Tanker is “all fast” at LNG Berth 3 to achieve Ready for Reduced Ship Loading (“First Try”). If Contractor achieves Ready for Reduced Ship Loading on the First Try, Owner shall pay Contractor a Schedule Bonus for SP6(b) in the amount of Sixty Thousand U.S. Dollars (U.S. $60,000) for each Day occurring after the date that Ready for Reduced Ship Loading occurs and before the Schedule Bonus Date for SP6(b), subject to the aggregate limit set forth in Section 5.c above.
|
|
g.
|
If Contractor does not achieve Ready for Reduced Ship Loading on the First Try, Contractor will receive no Schedule Bonus for SP6(b) for the First Try (except as set forth below) and Contractor shall give Owner a fourth written notice specifying the date on which Contractor expects Subproject 6(b) to be Ready for Reduced Ship Loading, which fourth notice shall be given no later than thirty (30) Days prior to such date. Owner shall use commercially reasonable efforts to provide LNG and a second LNG Tanker on the date that is no earlier than seven (7) Days prior to and not later than seven (7) Days after the date in such fourth written notice. Contractor shall have forty-eight (48) hours from the time that the second LNG Tanker is “all fast” at LNG Berth 3 to achieve Ready for Reduced Ship Loading (“Second Try”). Provided the date Contractor noticed Owner for the First Try was on or after two hundred fifty (250) Days prior to the Schedule Bonus Date for SP6(b) and Contractor achieves Ready for Reduced Ship Loading on the Second Try, Owner will pay Contractor a Schedule Bonus for SP6(b) in the amount of Thirty Thousand U.S. Dollars (U.S. $30,000) for each Day occurring from the date that the first LNG Tanker was “all fast” at LNG Berth 3 for the First Try until the date that Contractor achieves Ready for Reduced Ship Loading on the Second Try and Owner shall pay Contractor a Schedule Bonus for SP6(b) in the amount of Sixty Thousand U.S. Dollars (U.S. $60,000) for each Day occurring after the date Contractor achieves Ready for Reduced Ship Loading on the Second Try and before the Schedule Bonus Date for SP6(b), subject to the aggregate limit set forth in Section 5.c above. If Contractor fails to achieve Ready for Reduced Ship Loading on the Second Try, Owner shall have no obligation to pay Contractor the Schedule Bonus for SP6(b) and Contractor’s eligibility for the Schedule Bonus for SP6(b) shall terminate.
|
|
h.
|
Owner’s obligations to provide an LNG Tanker and LNG shall be subject and subordinate to commercial and operational considerations involving the operation of the Sabine Liquefaction Facility and the marketing of LNG, including but not limited to LNG production or storage outages, lower than projected inventory, the priority of SPL’s LNG buyer needs, delay of the LNG Vessel, refusal of the owner, charterer or manager of the LNG Tanker to load at LNG Berth 3 and limitations on loading at a single berth. In such events, Owner shall have the right to suspend or cancel Ready for Reduced Ship Loading at its sole discretion without liability to Contractor. In the event of suspension, the time period to achieve Ready for Reduced Ship Loading will be tolled until loading can resume. In the event of cancellation, Owner and Contractor shall agree to reschedule and upon Contractor’s achievement of Ready for Reduced Ship Loading, Owner shall pay Contractor a Schedule Bonus for SP6(b) in the amount of Thirty Thousand U.S. Dollars (U.S. $30,000) for each Day occurring after the date in Contractor’s third written notice until the date that Contractor achieves Ready for Reduced Ship Loading and Owner shall pay Contractor a Schedule Bonus for SP6(b) in the amount of Sixty Thousand U.S. Dollars (U.S. $60,000) for each Day occurring after the date Contractor achieves Ready for Reduced Ship Loading and before the Schedule Bonus Date for SP6(b), subject to the aggregate limit set forth in Section 5.c above. Owner is not required to schedule such LNG Tanker until (i) there is sufficient LNG in storage in the LNG Tanks to evidence Ready for Reduced Ship Loading and (ii) Owner has an economic reason to export such LNG.
|
|
i.
|
If Contractor is entitled to the Schedule Bonus for SP6(b) in accordance with Section 5.b of this Change Order No. 00009, Contractor shall invoice Owner the Schedule Bonus for SP6(b) upon achievement of Ready for Reduced Ship Loading; provided that, notwithstanding anything to the contrary, Contractor shall only be entitled to payment of the Schedule Bonus for SP6(b) if Contractor later achieves Substantial Completion of Subproject 6(b) prior to the Guaranteed Substantial Completion Date for SP6(b). Owner shall hold payment of such invoice in escrow until such time Contractor successfully completes the Ship Loading Time Test in accordance with Section 3.11.3 of Attachment S.
|
|
j.
|
For the avoidance of doubt, Contractor shall not be entitled to a Schedule Bonus for SP6(b) should Ready for Reduced Ship Loading be achieved on or after the Schedule Bonus Date for SP6(b).
|
|
k.
|
The Schedule Bonus Date for SP6(b) shall be subject to adjustment solely at the discretion of the President and Chief Executive Officer of Cheniere and any such adjustment shall be implemented by Change Order.
|
|
6.
|
Replace Table A-2 of Schedule A-2 of Attachment A to the Agreement in its entirety with Table A-2 as attached to this Change Order, which incorporates the updated FEED deliverables for LNG Berth 3.
|
|
7.
|
Add Schedule A-3 (“LNG Berth 3 Scope of Work”), as attached to this Change Order, to Attachment A to the Agreement.
|
|
8.
|
Add Schedule C-3 (“Milestone Payment Schedule for Subproject 6(b)”), as attached to this Change Order, to Attachment C to the Agreement.
|
|
9.
|
Add Schedule C-4 (“Monthly Payment Schedule for Subproject 6(b)”), as attached to this Change Order, to Attachment C to the Agreement.
|
|
10.
|
Replace Attachment E to the Agreement in its entirety with Attachment E as attached to this Change Order.
|
|
11.
|
Add Schedule H-7 (“Limited Notice to Proceed No. 2 for Subproject 6(b)”), as attached to this Change Order, to Attachment H to the Agreement.
|
|
12.
|
Replace Attachment T to the Agreement in its entirety with Attachment T as attached to this Change Order, which incorporates the Subproject 6(b) Delay Liquidated Damages.
|
|
13.
|
Replace Attachment U to the Agreement in its entirety with Attachment U as attached to this Change Order.
|
|
14.
|
Replace Attachment Z to the Agreement in its entirety with Attachment Z as attached to this Change Order.
|
|
15.
|
Add Schedule EE-3 (“Provisional Sums to be Fixed Based on Notice to Proceed for Subproject 6(b)”), as attached to this Change Order, to Attachment EE to the Agreement.
|
|
16.
|
Add Schedule EE-4 (“Provisional Sums to be Adjusted during Project Execution for Subproject 6(b)”), as attached to this Change Order, to Attachment EE to the Agreement.
|
|
1.
|
The original Contract Price Applicable to Subproject 6(a) was................................................................
|
$
|
2,016,892,573
|
|
|
2.
|
Net change for Contract Price Applicable to Subproject 6(a) by previously authorized Change Orders (#00001-00008)..........................................................................................................................................
|
$
|
(3,370,841
|
)
|
|
3.
|
The Contract Price Applicable to Subproject 6(a) prior to this Change Order was...................................
|
$
|
2,013,521,732
|
|
|
4.
|
The Contract Price Applicable to Subproject 6(a) will be unchanged by this Change Order in the amount of...................................................................................................................................................
|
$
|
—
|
|
|
5.
|
The Provisional Sum Applicable to Subproject 6(a) will be unchanged by this Change Order................
|
$
|
—
|
|
|
6.
|
The Contract Price Applicable to Subproject 6(a) including this Change Order will be...........................
|
$
|
2,013,521,732
|
|
|
7.
|
The original Contract Price Applicable to Subproject 6(b) was................................................................
|
$
|
—
|
|
|
8.
|
Net change for Contract Price Applicable to Subproject 6(b) by previously authorized Change Orders.
|
$
|
—
|
|
|
9.
|
The Contract Price Applicable to Subproject 6(b) prior to this Change Order was..................................
|
$
|
—
|
|
|
10.
|
The Contract Price Applicable to Subproject 6(b) will be increased by this Change Order in the amount of...................................................................................................................................................
|
$
|
457,696,000
|
|
|
11.
|
The Provisional Sum Applicable to Subproject 6(b) will be unchanged by this Change Order................
|
$
|
—
|
|
|
12.
|
The Contract Price Applicable to Subproject 6(b) including this Change Order will be..........................
|
$
|
457,696,000
|
|
|
13.
|
The original Contract Price was (add lines 1 and 7)..................................................................................
|
$
|
2,016,892,573
|
|
|
14.
|
The Contract Price prior to this Change Order was (add lines 3 and 9)....................................................
|
$
|
2,013,521,732
|
|
|
15.
|
The Contract Price will be increased by this Change Order in the amount of (add lines 4 and 10)..........
|
$
|
457,696,000
|
|
|
16.
|
The new Contract Price including this Change Order will be (add lines 14 and 15)................................
|
$
|
2,471,217,732
|
|
|
•
|
The Guaranteed Substantial Completion Date for Subproject 6(b) is One Thousand Four Hundred Seventy-Six (1,476) Days after issuance of LNTP No. 1 for Subproject 6(b).
|
|
•
|
The Target Substantial Completion Date for Subproject 6(b) is One Hundred Sixty-Seven (167) Days before the Guaranteed Substantial Completion Date for Subproject 6(b).
|
|
/s/ David Craft
|
|
/s/ Maurissa D. Rogers
|
|
Owner
|
|
Contractor
|
|
David Craft
|
|
Maurissa D. Rogers
|
|
Name
|
|
Name
|
|
SVP E&C
|
|
Sr Project Manager, PVP
|
|
Title
|
|
Title
|
|
September 25, 2019
|
|
September 25, 2019
|
|
Date of Signing
|
|
Date of Signing
|
|
PROJECT NAME: Sabine Pass LNG Stage 4 Liquefaction Facility
OWNER: Sabine Pass Liquefaction, LLC
CONTRACTOR: Bechtel Oil, Gas and Chemicals, Inc.
DATE OF AGREEMENT: November 7, 2018
|
CHANGE ORDER NUMBER: CO-00010
DATE OF CHANGE ORDER: September 16, 2019
|
|
1.
|
In accordance with Article 6.1.B (Change Orders Requested by Owner), the Parties agree this Change Order includes costs associated with Owner’s request for Contractor to engage with the cold box Supplier (Linde) for a potential re-design of the Train 6 cold boxes to minimize the number of transition joints. This Change Order is in accordance with the approved Trend No. S4-0008, which includes the following:
|
|
i.
|
Ethylene Cold Box, E-1504 A/B: Supplier to relocate transition joints from the vertical position to the horizontal position in the shop prior to shipment.
|
|
ii.
|
Ethylene Cold Box, E-1504 A/B: Add an additional level transmitter. Supplier to add taps in the shop prior to shipment. Top tap will be outside the cold box (common with the existing level transmitter), and bottom tap to be added to piping below vessel (outside cold box). Level transmitter will be used to confirm there is no liquid remaining in the core prior to restart.
|
|
iii.
|
Methane Cold Box: Supplier to remove individual transition joints on E-1605 ‘A’ pass inlet & outlet and replace with a single transition joint on inlet header for ‘A’ pass and aluminum flange on outlet of ‘A’ pass at PV-16002 in the shop prior to shipment.
|
|
2.
|
In accordance with Article 6.1.B (Change Orders Requested by Owner), the Parties agree this Change Order includes costs associated with Owner’s request for Contractor to engage with the cold box Supplier (Linde) for the addition of inspection boxes on the Methane Cold Box. This Change Order is in accordance with the approved Trend No. S4-0036, which includes the following:
|
|
i.
|
Methane Cold Box: Supplier to provide five (5) external inspection boxes around relocated transition joints on P11, N18, N20, N40 and flange on S13, in order to provide protection for the transition joint / flange and aluminum piping. All Work to be performed in Supplier’s shop prior to shipment.
|
|
3.
|
The detailed cost breakdown for the Train 6 Cold Box Redesign Scope of Work (Section 1 Above) of this Change Order is detailed in Exhibit A of this Change Order.
|
|
4.
|
The detailed cost breakdown for the Addition of Inspection Boxes on Methane Cold Box Scope of Work (Section 2 Above) of this Change Order is detailed in Exhibit B of this Change Order
|
|
5.
|
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.........................................................................................................................
|
$
|
2,016,892,573
|
|
|
Net change by previously authorized Change Orders Applicable to Subproject 6(a) (00001-00008)..............
|
$
|
(3,370,841
|
)
|
|
The Contract Price prior to this Change Order was...........................................................................................
|
$
|
2,013,521,732
|
|
|
The Contract Price Applicable to Subproject 6(a) will be increased by this Change Order in the amount of........................................................................................................................................................................
|
$
|
1,956,641
|
|
|
The Contract Price Applicable to Subproject 6(b) will be unchanged by this Change Order in the amount of
|
$
|
—
|
|
|
The Provisional Sum will be increased by this Change Order in the amount of...............................................
|
$
|
—
|
|
|
The Contract Price will be increased by this Change Order in the amount of...................................................
|
$
|
1,956,641
|
|
|
The new Contract Price including this Change Order will be...........................................................................
|
$
|
2,015,478,373
|
|
|
/s/ David Craft
|
|
/s/ Maurissa D. Rogers
|
|
Owner
|
|
Contractor
|
|
David Craft
|
|
Maurissa D. Rogers
|
|
Name
|
|
Name
|
|
SVP E&C
|
|
Sr Project Mgr, PVP
|
|
Title
|
|
Title
|
|
September 19, 2019
|
|
September 16, 2019
|
|
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 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 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 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
|