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Financial Instruments Financial Instruments (Tables)
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3 Months Ended |
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Mar. 31, 2013
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| Derivative Instruments and Hedging Activities Disclosure [Abstract] |
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| Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis |
The following table (in thousands) shows the fair value of our derivative assets and liabilities that are required to be measured at fair value on a recurring basis as of March 31, 2013 and December 31, 2012, which are classified as other current assets, other current liabilities and other non-current liabilities in our Consolidated Balance Sheets.
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Fair Value Measurements as of |
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March 31, 2013 |
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December 31, 2012 |
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Quoted Prices in Active Markets
(Level 1)
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Significant Other Observable Inputs (Level 2) |
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Significant Unobservable Inputs (Level 3) |
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Total |
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Quoted Prices in Active Markets
(Level 1)
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Significant Other Observable Inputs (Level 2) |
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Significant Unobservable Inputs (Level 3) |
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Total |
LNG Inventory Derivatives asset (liability) |
$ |
— |
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$ |
(421 |
) |
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$ |
— |
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$ |
(421 |
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$ |
— |
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$ |
232 |
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$ |
— |
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$ |
232 |
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Fuel Derivatives asset (liability) |
— |
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420 |
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— |
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420 |
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— |
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(98 |
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— |
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(98 |
) |
Interest Rate Derivatives (liability) |
— |
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(23,055 |
) |
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— |
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(23,055 |
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— |
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(26,424 |
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— |
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(26,424 |
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| Schedule of Other Derivatives Not Designated as Hedging Instruments, Statements of Financial Performance and Financial Position, Location [Table Text Block] |
The following table (in thousands) shows the changes in the fair value of our De-designated Interest Rate Derivatives recorded in derivative loss on our Consolidated Statements of Operations during the three months ended March 31, 2013 and 2012:
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Three Months Ended March 31, |
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2013 |
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2012 |
Interest Rate Derivatives - De-designated loss |
$ |
17,983 |
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$ |
— |
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The following table (in thousands) shows the changes in the fair value and settlements of our LNG Inventory Derivatives recorded in marketing and trading revenues (losses) on our Consolidated Statements of Operations during the three months ended March 31, 2013 and 2012:
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Three Months Ended March 31, |
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2013 |
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2012 |
LNG Inventory Derivatives gain (loss) |
$ |
(550 |
) |
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$ |
1,171 |
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The following table (in thousands) shows the changes in the fair value and settlements of our Fuel Derivatives recorded in derivative gain (loss) on our Consolidated Statements of Operations during the three months ended March 31, 2013 and 2012:
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Three Months Ended March 31, |
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2013 |
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2012 |
Fuel Derivatives gain (loss) |
$ |
515 |
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$ |
(836 |
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| Schedule of Notional Amounts of Outstanding Derivative Positions |
At March 31, 2013, Sabine Pass Liquefaction had the following Interest Rate Derivatives outstanding that converted $20.0 million of the Liquefaction Credit Facility from a variable to a fixed interest rate. Sabine Pass Liquefaction pays a fixed interest rate on the swap and in exchange receives a variable interest rate based on the one-month LIBOR.
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Initial Notional Amount |
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Maximum Notional Amount |
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Effective Date |
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Maturity Date |
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Weighted Average Fixed Interest Rate Paid |
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Variable Interest Rate Received |
Interest Rate Derivatives - De-designated |
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$20.0 million |
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$2.9 billion |
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August 14, 2012 |
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July 31, 2019 |
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1.98% |
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One-month LIBOR |
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| Schedule of Interest Rate Derivatives |
The following table (in thousands) shows the fair value of our interest rate swaps:
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Fair Value Measurements as of |
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Balance Sheet Location |
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March 31, 2013 |
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December 31, 2012 |
Interest Rate Derivatives - Designated |
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Non-current derivative liabilities |
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$ |
— |
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$ |
21,290 |
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Interest Rate Derivatives - De-designated |
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Other current liabilities |
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1,077 |
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— |
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Interest Rate Derivatives - De-designated |
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Non-current derivative liabilities |
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21,978 |
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5,134 |
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| Schedule of Cash Flow Hedges Included in Accumulated Other Comprehensive Income (Loss) |
The following table (in thousands) shows our Interest Rate Derivatives market adjustments recorded during the three months ended March 31, 2013 and 2012:
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Gain (Loss) in Other Comprehensive Income |
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Gain (Loss) Reclassified from Accumulated OCI into Interest Expense (Effective Portion) |
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Gain (Loss) Recognized in Income (Ineffective Portion and Amount Excluded from Effectiveness Testing) |
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2013 |
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2012 |
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2013 |
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2012 |
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2013 |
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2012 |
Interest Rate Derivatives - Designated |
$ |
21,297 |
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$ |
— |
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$ |
— |
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$ |
— |
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$ |
— |
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$ |
— |
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Interest Rate Derivatives - De-designated |
— |
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— |
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— |
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— |
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— |
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— |
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Interest Rate Derivatives - Settlements |
(30 |
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— |
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— |
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— |
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— |
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— |
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| Schedule of Derivative Instruments in Statement of Financial Position, Fair Value |
The Company's commodity and interest rate derivatives are presented on a net basis on our Consolidated Balance Sheets as described above. The following table (in thousands) shows the fair value of our derivatives outstanding on a gross basis:
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Gross Amounts Recognized |
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Gross Amounts Offset in the Consolidated Balance Sheet |
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Net Amounts Presented in the Consolidated Balance Sheet |
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Gross Amounts Not Offset in the Consolidated Balance Sheet |
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Offsetting Derivative Assets (Liabilities) |
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Derivative Instrument |
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Cash Collateral Received (Paid) |
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Net Amount |
As of March 31, 2013: |
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Fuel Derivatives |
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$ |
420 |
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$ |
— |
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$ |
420 |
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$ |
— |
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$ |
— |
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$ |
420 |
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LNG Inventory Derivatives |
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(421 |
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(421 |
) |
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— |
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— |
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— |
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— |
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Interest Rate Derivatives - de-designated |
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(23,055 |
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— |
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(23,055 |
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— |
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— |
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(23,055 |
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As of December 31, 2012: |
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Fuel Derivatives |
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(98 |
) |
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(98 |
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— |
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— |
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— |
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— |
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LNG Inventory Derivatives |
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232 |
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— |
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232 |
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— |
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— |
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232 |
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Interest Rate Derivatives - designated |
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(21,290 |
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— |
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(21,290 |
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— |
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— |
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(21,290 |
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Interest Rate Derivatives - de-designated |
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(5,134 |
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— |
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(5,134 |
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— |
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— |
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(5,134 |
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| Fair Value, by Balance Sheet Grouping |
Other Financial Instruments (in thousands):
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March 31, 2013 |
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December 31, 2012 |
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Carrying
Amount
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Estimated
Fair Value
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Carrying
Amount
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Estimated
Fair Value
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2016 Notes, net of discount (1) |
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$ |
1,648,286 |
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$ |
1,825,477 |
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$ |
1,647,113 |
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$ |
1,824,177 |
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2020 Notes (1) |
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420,000 |
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444,150 |
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420,000 |
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437,850 |
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2021 Sabine Pass Liquefaction Notes (1) |
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1,500,000 |
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1,552,500 |
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— |
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— |
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Liquefaction Credit Facility (2) |
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100,000 |
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100,000 |
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100,000 |
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100,000 |
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(1) |
The Level 2 estimated fair value was based on quotations obtained from broker-dealers who make markets in these and similar instruments based on the closing trading prices on March 31, 2013 and December 31, 2012, as applicable.
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(2) |
The Level 3 estimated fair value was determined to be the carrying amount due to our ability to call this debt at anytime without penalty. |
The following table (in thousands) shows the fair value and location of our LNG Inventory Derivatives and Fuel Derivatives on our Consolidated Balance Sheets:
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Fair Value Measurements as of |
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Balance Sheet Location |
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March 31, 2013 |
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December 31, 2012 |
LNG Inventory Derivatives asset (liability) |
Prepaid expenses and other/ (Other current liabilities) |
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$ |
(421 |
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$ |
232 |
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Fuel Derivatives asset (liability) |
Prepaid expenses and other/ (Other current liabilities) |
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420 |
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(98 |
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