Annual report pursuant to Section 13 and 15(d)

Supplemental Guarantor Information

v3.10.0.1
Supplemental Guarantor Information
12 Months Ended
Dec. 31, 2018
Supplemental Guarantor Information [Abstract]  
Supplemental Guarantor Information
SUPPLEMENTAL GUARANTOR INFORMATION

Our CQP Senior Notes are jointly and severally guaranteed by each of our subsidiaries other than SPL (the “Guarantors”) and, subject to certain conditions governing its guarantee, Sabine Pass LP (collectively with SPL, the “Non-Guarantors”). These guarantees are full and unconditional, subject to certain customary release provisions including (1) the sale, exchange, disposition or transfer (by merger, consolidation or otherwise) of the capital stock or all or substantially all of the assets of the Guarantors, (2) upon the liquidation or dissolution of a Guarantor, (3) following the release of a Guarantor from its guarantee obligations and (4) upon the legal defeasance or satisfaction and discharge of obligations under the CQP Indenture. See Note 11—Debt for additional information regarding the CQP Senior Notes.

The following is condensed consolidating financial information for Cheniere Partners (“Parent Issuer”), the Guarantors on a combined basis and the Non-Guarantors on a combined basis. The condensed consolidating financial information has been prepared using the same accounting policies as described in Note 3—Summary of Significant Accounting Policies, except for the investments in subsidiaries, which is accounted for using the equity method.

In lieu of Schedule I pursuant to the requirements of Rule 5-04 of Reg S-X, the condensed parent company financial statements are presented below in the Parent Issuer column. The condensed parent only financial statements have been provided in accordance with the rules and regulations of the SEC and should be read in conjunction with Cheniere Partners’ Consolidated Financial Statements. Pursuant to the SEC rules and regulations, the condensed parent company financial statements do not include all of the financial information and notes normally included with financial statements prepared in accordance with GAAP.
Condensed Consolidating Balance Sheet
December 31, 2018
(in millions)
 
 
 
 
 
 
 
 
 
 
 
Parent Issuer
 
Guarantors
 
Non-Guarantors
 
Eliminations
 
Consolidated
ASSETS
 
 
 
 
 
 
 
 
 
Current assets
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$
—

 
$
—

 
$
—

 
$
—

 
$
—

Restricted cash
779

 
6

 
756

 
—

 
1,541

Accounts and other receivables
1

 
1

 
346

 
—

 
348

Accounts receivable—affiliate
1

 
40

 
113

 
(40
)
 
114

Advances to affiliate
—

 
104

 
210

 
(86
)
 
228

Inventory
—

 
12

 
87

 
—

 
99

Other current assets
—

 
2

 
24

 
—

 
26

Other current assets—affiliate
—

 
—

 
21

 
(21
)
 
—

Total current assets
781

 
165

 
1,557

 
(147
)
 
2,356

 
 
 
 
 
 
 
 
 
 
Property, plant and equipment, net
79

 
2,128

 
13,209

 
(26
)
 
15,390

Debt issuance costs, net
1

 
—

 
12

 
—

 
13

Non-current derivative assets
—

 
—

 
31

 
—

 
31

Investments in subsidiaries
2,544

 
440

 
—

 
(2,984
)
 
—

Other non-current assets, net
—

 
26

 
158

 
—

 
184

Total assets
$
3,405

 
$
2,759

 
$
14,967

 
$
(3,157
)
 
$
17,974

 
 
 
 
 
 
 
 
 
 
LIABILITIES AND PARTNERS’ EQUITY
 
 
 
 
 
 
 
 
 
Current liabilities
 
 
 
 
 
 
 
 
 
Accounts payable
$
—

 
$
4

 
$
11

 
$
—

 
$
15

Accrued liabilities
39

 
14

 
768

 
—

 
821

Due to affiliates
—

 
127

 
48

 
(126
)
 
49

Deferred revenue
—

 
25

 
91

 
—

 
116

Deferred revenue—affiliate
—

 
22

 
—

 
(21
)
 
1

Derivative liabilities
—

 
—

 
66

 
—

 
66

Total current liabilities
39

 
192

 
984

 
(147
)
 
1,068

 
 
 
 
 
 
 
 
 
 
Long-term debt, net
2,566

 
—

 
13,500

 
—

 
16,066

Non-current derivative liabilities
—

 
—

 
14

 
—

 
14

Other non-current liabilities
—

 
1

 
3

 
—

 
4

Other non-current liabilities—affiliate
—

 
22

 
—

 
—

 
22

 
 
 
 
 
 
 
 
 
 
Partners’ equity
800

 
2,544

 
466

 
(3,010
)
 
800

Total liabilities and partners’ equity
$
3,405

 
$
2,759

 
$
14,967

 
$
(3,157
)
 
$
17,974


Condensed Consolidating Balance Sheet
December 31, 2017
(in millions)
 
 
 
 
 
 
 
 
 
 
 
Parent Issuer
 
Guarantors
 
Non-Guarantors
 
Eliminations
 
Consolidated
ASSETS
 
 
 
 
 
 
 
 
 
Current assets
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$
—

 
$
—

 
$
—

 
$
—

 
$
—

Restricted cash
1,033

 
12

 
544

 
—

 
1,589

Accounts and other receivables
—

 
2

 
189

 
—

 
191

Accounts receivable—affiliate
—

 
36

 
163

 
(36
)
 
163

Advances to affiliate
—

 
20

 
26

 
(10
)
 
36

Inventory
—

 
10

 
85

 
—

 
95

Other current assets
8

 
3

 
54

 
—

 
65

Other current assets—affiliate
—

 
—

 
21

 
(21
)
 
—

Total current assets
1,041

 
83

 
1,082

 
(67
)
 
2,139

 
 
 
 
 
 
 
 
 
 
Property, plant and equipment, net
80

 
2,164

 
12,920

 
(25
)
 
15,139

Debt issuance costs, net
20

 
—

 
18

 
—

 
38

Non-current derivative assets
14

 
—

 
17

 
—

 
31

Investments in subsidiaries
2,076

 
(63
)
 
—

 
(2,013
)
 
—

Other non-current assets, net
—

 
37

 
169

 
—

 
206

Total assets
$
3,231

 
$
2,221

 
$
14,206

 
$
(2,105
)
 
$
17,553

 
 
 
 
 
 
 
 
 
 
LIABILITIES AND PARTNERS’ EQUITY
 
 
 
 
 
 
 
 
 
Current liabilities
 
 
 
 
 
 
 
 
 
Accounts payable
$
—

 
$
4

 
$
8

 
$
—

 
$
12

Accrued liabilities
23

 
8

 
606

 
—

 
637

Due to affiliates
—

 
47

 
66

 
(45
)
 
68

Deferred revenue
—

 
27

 
84

 
—

 
111

Deferred revenue—affiliate
—

 
22

 
—

 
(21
)
 
1

Other current liabilities—affiliate
—

 
1

 
—

 
(1
)
 
—

Total current liabilities
23

 
109

 
764

 
(67
)
 
829

 
 
 
 
 
 
 
 
 
 
Long-term debt, net
2,569

 
—

 
13,477

 
—

 
16,046

Non-current derivative liabilities
—

 
—

 
3

 
—

 
3

Other non-current liabilities
—

 
11

 
—

 
—

 
11

Other non-current liabilities—affiliate
—

 
25

 
—

 
—

 
25

 
 
 
 
 
 
 
 
 
 
Partners’ equity (deficit)
639

 
2,076

 
(38
)
 
(2,038
)
 
639

Total liabilities and partners’ equity (deficit)
$
3,231

 
$
2,221

 
$
14,206

 
$
(2,105
)
 
$
17,553







Condensed Consolidating Statement of Operations
Year Ended December 31, 2018
(in millions)
 
 
 
 
 
 
 
 
 
 
 
Parent Issuer
 
Guarantors
 
Non-Guarantors
 
Eliminations
 
Consolidated
 
 
 
 
 
 
 
 
 
 
Revenues
 
 
 
 
 
 
 
 
 
LNG revenues
$
—

 
$
—

 
$
4,827

 
$
—

 
$
4,827

LNG revenues—affiliate
—

 
—

 
1,299

 
—

 
1,299

Regasification revenues
—

 
261

 
—

 
—

 
261

Regasification revenues—affiliate
—

 
258

 
—

 
(258
)
 
—

Other revenues
—

 
39

 
—

 
—

 
39

Other revenues—affiliate
—

 
247

 
—

 
(247
)
 
—

Total revenues
—

 
805

 
6,126

 
(505
)
 
6,426

 
 
 
 
 
 
 
 
 
 
Operating costs and expenses
 
 
 
 
 
 
 
 
 
Cost of sales (excluding depreciation and amortization expense shown separately below)
—

 
—

 
3,403

 
—

 
3,403

Cost of sales—affiliate
—

 
—

 
32

 
(32
)
 
—

Operating and maintenance expense
—

 
67

 
342

 
—

 
409

Operating and maintenance expense—affiliate
—

 
151

 
423

 
(457
)
 
117

Development expense
—

 
—

 
2

 
—

 
2

General and administrative expense
4

 
2

 
5

 
—

 
11

General and administrative expense—affiliate
12

 
25

 
50

 
(14
)
 
73

Depreciation and amortization expense
2

 
74

 
349

 
(1
)
 
424

Impairment expense and loss on disposal of assets
—

 
8

 
—

 
—

 
8

Total operating costs and expenses
18

 
327

 
4,606

 
(504
)
 
4,447

 
 
 
 
 
 
 
 
 
 
Income (loss) from operations
(18
)
 
478

 
1,520

 
(1
)
 
1,979

 
 
 
 
 
 
 
 
 
 
Other income (expense)
 
 
 
 
 
 
 
 
 
Interest expense, net of capitalized interest
(139
)
 
(5
)
 
(589
)
 
—

 
(733
)
Loss on modification or extinguishment of debt
(12
)
 
—

 
—

 
—

 
(12
)
Derivative gain, net
14

 
—

 
—

 
—

 
14

Equity earnings of subsidiaries
1,416

 
944

 
—

 
(2,360
)
 
—

Other income
13

 
—

 
13

 
—

 
26

Total other income (expense)
1,292

 
939

 
(576
)
 
(2,360
)
 
(705
)
 
 
 
 
 
 
 
 
 
 
Net income
$
1,274

 
$
1,417

 
$
944

 
$
(2,361
)
 
$
1,274


Condensed Consolidating Statement of Operations
Year Ended December 31, 2017
(in millions)
 
 
 
 
 
 
 
 
 
 
 
Parent Issuer
 
Guarantors
 
Non-Guarantors
 
Eliminations
 
Consolidated
 
 
 
 
 
 
 
 
 
 
Revenues
 
 
 
 
 
 
 
 
 
LNG revenues
$
—

 
$
—

 
$
2,635

 
$
—

 
$
2,635

LNG revenues—affiliate
—

 
—

 
1,389

 
—

 
1,389

Regasification revenues
—

 
260

 
—

 
—

 
260

Regasification revenues—affiliate
—

 
190

 
—

 
(190
)
 
—

Other revenues
—

 
20

 
—

 
—

 
20

Other revenues—affiliate
—

 
218

 
—

 
(218
)
 
—

Total revenues
—

 
688

 
4,024

 
(408
)
 
4,304

 
 
 
 
 
 
 
 
 
 
Operating costs and expenses
 
 
 
 
 
 
 
 
 
Cost of sales (excluding depreciation and amortization expense shown separately below)
—

 
1

 
2,317

 
2

 
2,320

Cost of sales—affiliate
—

 
—

 
23

 
(23
)
 
—

Operating and maintenance expense
4

 
45

 
243

 
—

 
292

Operating and maintenance expense—affiliate
6

 
137

 
329

 
(372
)
 
100

Development expense
—

 
1

 
2

 
—

 
3

General and administrative expense
4

 
1

 
7

 
—

 
12

General and administrative expense—affiliate
11

 
15

 
58

 
(4
)
 
80

Depreciation and amortization expense
2

 
74

 
264

 
(1
)
 
339

Other
—

 
2

 
—

 
—

 
2

Total operating costs and expenses
27

 
276

 
3,243

 
(398
)
 
3,148

 
 
 
 
 
 
 
 
 
 
Income (loss) from operations
(27
)
 
412

 
781

 
(10
)
 
1,156

 
 
 
 
 
 
 
 
 
 
Other income (expense)
 
 
 
 
 
 
 
 
 
Interest expense, net of capitalized interest
(111
)
 
(9
)
 
(494
)
 
—

 
(614
)
Loss on modification or extinguishment of debt
(25
)
 
—

 
(42
)
 
—

 
(67
)
Derivative gain (loss), net
6

 
—

 
(2
)
 
—

 
4

Equity earnings of subsidiaries
643

 
250

 
—

 
(893
)
 
—

Other income
4

 
—

 
7

 
—

 
11

Total other income (expense)
517

 
241

 
(531
)
 
(893
)
 
(666
)
 
 
 
 
 
 
 
 
 
 
Net income
$
490

 
$
653

 
$
250

 
$
(903
)
 
$
490



Condensed Consolidating Statement of Operations
Year Ended December 31, 2016
(in millions)
 
 
 
 
 
 
 
 
 
 
 
Parent Issuer
 
Guarantors
 
Non-Guarantors
 
Eliminations
 
Consolidated
 
 
 
 
 
 
 
 
 
 
Revenues
 
 
 
 
 
 
 
 
 
LNG revenues
$
—

 
$
—

 
$
539

 
$
—

 
$
539

LNG revenues—affiliate
—

 
—

 
294

 
—

 
294

Regasification revenues
—

 
259

 
—

 
—

 
259

Regasification revenues—affiliate
—

 
61

 
—

 
(61
)
 
—

Other revenues
—

 
4

 
—

 
—

 
4

Other revenues—affiliate
—

 
163

 
—

 
(159
)
 
4

Total revenues
—

 
487

 
833

 
(220
)
 
1,100

 
 
 
 
 
 
 
 
 
 
Operating costs and expenses
 
 
 
 
 
 
 
 
 
Cost of sales (excluding depreciation and amortization expense shown separately below)
—

 
—

 
416

 
(6
)
 
410

Cost of sales—affiliate
—

 
—

 
7

 
(5
)
 
2

Operating and maintenance expense
5

 
48

 
72

 
2

 
127

Operating and maintenance expense—affiliate
—

 
113

 
129

 
(190
)
 
52

Development expense—affiliate
—

 
—

 
1

 
(1
)
 
—

General and administrative expense
4

 
2

 
7

 
—

 
13

General and administrative expense—affiliate
12

 
15

 
68

 
(5
)
 
90

Depreciation and amortization expense
1

 
72

 
83

 
—

 
156

Total operating costs and expenses
22

 
250

 
783

 
(205
)
 
850

 
 
 
 
 
 
 
 
 
 
Income (loss) from operations
(22
)
 
237

 
50

 
(15
)
 
250

 
 
 
 
 
 
 
 
 
 
Other income (expense)
 
 
 
 
 
 
 
 
 
Interest expense, net of capitalized interest
(23
)
 
(148
)
 
(186
)
 
—

 
(357
)
Loss on modification or extinguishment of debt
—

 
(20
)
 
(52
)
 
—

 
(72
)
Derivative gain (loss), net
12

 
—

 
(6
)
 
—

 
6

Equity losses of subsidiaries
(138
)
 
(193
)
 
—

 
331

 
—

Other income
—

 
1

 
1

 
—

 
2

Total other expense
(149
)
 
(360
)
 
(243
)
 
331

 
(421
)
 
 
 
 
 
 
 
 
 
 
Net loss
$
(171
)
 
$
(123
)
 
$
(193
)
 
$
316

 
$
(171
)


Condensed Consolidating Statement of Cash Flows
Year Ended December 31, 2018
(in millions)
 
 
 
 
 
 
 
 
 
 
 
Parent Issuer
 
Guarantors
 
Non-Guarantors
 
Eliminations
 
Consolidated
Cash flows provided by operating activities
$
714

 
$
569

 
$
1,423

 
$
(832
)
 
$
1,874

 
 
 
 
 
 
 
 
 
 
Cash flows from investing activities
 
 
 
 
 
 
 
 
 
Property, plant and equipment, net
—

 
(34
)
 
(771
)
 
1

 
(804
)
Investments in subsidiaries
(304
)
 
(129
)
 
—

 
433

 
—

Distributions received from affiliates, net
454

 
537

 
—

 
(991
)
 
—

Net cash provided by (used in) investing activities
150

 
374

 
(771
)
 
(557
)
 
(804
)
 
 
 
 
 
 
 
 
 
 
Cash flows from financing activities
 
 
 
 
 
 
 
 
 
Proceeds from issuances of debt
1,100

 
—

 
—

 
—

 
1,100

Repayments of debt
(1,090
)
 
—

 
—

 
—

 
(1,090
)
Debt issuance and deferred financing costs
(8
)
 
—

 
—

 
—

 
(8
)
Debt extinguishment costs
(7
)
 
—

 
—

 
—

 
(7
)
Distributions to parent
—

 
(1,253
)
 
(569
)
 
1,822

 
—

Contributions from parent
—

 
304

 
129

 
(433
)
 
—

Distributions to owners
(1,113
)
 
—

 
—

 
—

 
(1,113
)
Net cash used in financing activities
(1,118
)
 
(949
)
 
(440
)
 
1,389

 
(1,118
)
 
 
 
 
 
 
 
 
 
 
Net increase (decrease) in cash, cash equivalents and restricted cash
(254
)
 
(6
)
 
212

 
—

 
(48
)
Cash, cash equivalents and restricted cash—beginning of period
1,033

 
12

 
544

 
—

 
1,589

Cash, cash equivalents and restricted cash—end of period
$
779

 
$
6

 
$
756

 
$
—

 
$
1,541



Balances per Condensed Consolidating Balance Sheet:
 
December 31, 2018
 
Parent Issuer
 
Guarantors
 
Non-Guarantors
 
Eliminations
 
Consolidated
Cash and cash equivalents
$
—

 
$
—

 
$
—

 
$
—

 
$
—

Restricted cash
779

 
6

 
756

 
—

 
1,541

Total cash, cash equivalents and restricted cash
$
779

 
$
6

 
$
756

 
$
—

 
$
1,541


Condensed Consolidating Statement of Cash Flows
Year Ended December 31, 2017
(in millions)
 
 
 
 
 
 
 
 
 
 
 
Parent Issuer
 
Guarantors
 
Non-Guarantors
 
Eliminations
 
Consolidated
Cash flows provided by (used in) operating activities
$
(101
)
 
$
431

 
$
657

 
$
(10
)
 
$
977

 
 
 
 
 
 
 
 
 
 
Cash flows from investing activities
 
 
 
 
 
 
 
 
 
Property, plant and equipment, net
—

 
(21
)
 
(1,279
)
 
10

 
(1,290
)
Investments in subsidiaries
(245
)
 
(7
)
 
—

 
252

 
—

Distributions received from affiliates, net
1,431

 
782

 
—

 
(2,213
)
 
—

Net cash provided by (used in) investing activities
1,186

 
754

 
(1,279
)
 
(1,951
)
 
(1,290
)
 
 
 
 
 
 
 
 
 
 
Cash flows from financing activities
 
 
 
 
 
 
 
 
 
Proceeds from issuances of debt
1,500

 
—

 
2,314

 
—

 
3,814

Repayments of debt
(1,470
)
 
—

 
(703
)
 
—

 
(2,173
)
Debt issuance and deferred financing costs
(22
)
 
—

 
(28
)
 
—

 
(50
)
Distributions to parent
—

 
(1,431
)
 
(782
)
 
2,213

 
—

Contributions from parent
—

 
245

 
7

 
(252
)
 
—

Distributions to owners
(294
)
 
—

 
—

 
—

 
(294
)
Net cash provided by (used in) financing activities
(286
)
 
(1,186
)
 
808

 
1,961

 
1,297

 
 
 
 
 
 
 
 
 
 
Net increase (decrease) in cash, cash equivalents and restricted cash
799

 
(1
)
 
186

 
—

 
984

Cash, cash equivalents and restricted cash—beginning of period
234

 
13

 
358

 
—

 
605

Cash, cash equivalents and restricted cash—end of period
$
1,033

 
$
12

 
$
544

 
$
—

 
$
1,589



Balances per Condensed Consolidating Balance Sheet:
 
December 31, 2017
 
Parent Issuer
 
Guarantors
 
Non-Guarantors
 
Eliminations
 
Consolidated
Cash and cash equivalents
$
—

 
$
—

 
$
—

 
$
—

 
$
—

Restricted cash
1,033

 
12

 
544

 
—

 
1,589

Total cash, cash equivalents and restricted cash
$
1,033

 
$
12

 
$
544

 
$
—

 
$
1,589


Condensed Consolidating Statement of Cash Flows
Year Ended December 31, 2016
(in millions)
 
 
 
 
 
 
 
 
 
 
 
Parent Issuer
 
Guarantors
 
Non-Guarantors
 
Eliminations
 
Consolidated
Cash flows provided by (used in) operating activities
$
(53
)
 
$
181

 
$
(130
)
 
$
2

 
$
—

 
 
 
 
 
 
 
 
 
 
Cash flows from investing activities
 
 
 
 
 
 
 
 
 
Property, plant and equipment, net
—

 
(7
)
 
(2,306
)
 
(2
)
 
(2,315
)
Investments in subsidiaries
(2,429
)
 
(1
)
 
—

 
2,430

 
—

Distributions received from affiliates, net
218

 
—

 
—

 
(218
)
 
—

Other
—

 
(6
)
 
(32
)
 
—

 
(38
)
Net cash used in investing activities
(2,211
)

(14
)

(2,338
)

2,210


(2,353
)
 
 
 
 
 
 
 
 
 
 
Cash flows from financing activities
 
 
 
 
 
 
 
 
 
Proceeds from issuances of debt
2,560

 
—

 
5,443

 
—

 
8,003

Repayments of debt
—

 
(2,486
)
 
(2,765
)
 
—

 
(5,251
)
Debt issuance and deferred financing costs
(73
)
 
—

 
(42
)
 
—

 
(115
)
Debt extinguishment costs
—

 
(14
)
 
—

 
—

 
(14
)
Distributions to parent
—

 
(218
)
 
—

 
218

 
—

Contributions from parent
—

 
2,429

 
1

 
(2,430
)
 
—

Distributions to owners
(99
)
 
—

 
—

 
—

 
(99
)
Net cash provided by (used in) financing activities
2,388

 
(289
)
 
2,637

 
(2,212
)
 
2,524

 
 
 
 
 
 
 
 
 
 
Net increase (decrease) in cash, cash equivalents and restricted cash
124

 
(122
)
 
169

 
—

 
171

Cash, cash equivalents and restricted cash—beginning of period
110

 
135

 
189

 
—

 
434

Cash, cash equivalents and restricted cash—end of period
$
234

 
$
13

 
$
358

 
$
—

 
$
605