Annual report [Section 13 and 15(d), not S-K Item 405]

Related Party Transactions

v3.25.4
Related Party Transactions
 12 Months Ended
Dec. 31, 2025
Related Party Transactions [Abstract]  
Related Party Transactions RELATED PARTY TRANSACTIONS
 
Below is a summary of our related party transactions, all in the ordinary course of business, as reported on our Consolidated Statements of Operations (in millions):
Year Ended December 31,
2025 2024 2023
LNG revenues—affiliate
SPAs and Letter Agreements (1)
 $ 2,358  $ 1,954  $ 2,472 
Contracts for Sale and Purchase of Natural Gas (2) —  —  3 
Total LNG revenues—affiliate 2,358  1,954  2,475 
Cost of sales—affiliate
SPAs and Letter Agreements (1)
 —  4  — 
Contracts for Sale and Purchase of Natural Gas and LNG (1) (2) —  —  22 
Total cost of sales—affiliate —  4  22 
Operating and maintenance expense—affiliate
Services Agreements (3) 177  172  166 
Operating and maintenance expense—related party
Natural Gas Transportation and Storage Agreements (4) 28  58  62 
General and administrative expense—affiliate
Services Agreements (3) 93  90  89 
Other operating costs and expenses—affiliate
Services Agreements (3) 1  2  1 
Other income—affiliate
Services Agreements (5) 24 —  — 
(1)SPL primarily sells LNG to Cheniere Marketing under SPAs and letter agreements at a price equal to 115% of Henry Hub plus a fixed fee, except for an SPA associated with an IPM agreement for which pricing is linked to international natural gas prices. SPL also has a master SPA agreement with Cheniere Marketing that allows SPL to sell and purchase LNG with Cheniere Marketing by executing and delivering confirmations under this agreement. In addition, SPL has an arrangement with Cheniere Marketing to provide the ability, in limited circumstances, to potentially fulfill commitments to LNG buyers in the event operational conditions impact operations at either the Sabine Pass or Corpus Christi liquefaction facilities. The purchase price for such cargoes would be the greater of: (a) 115% of the applicable natural gas feedstock purchase price or (b) an FOB U.S. Gulf Coast LNG market price.
(2)SPL has an agreement with CCL that allows them to sell and purchase natural gas from each other at prices and quantities as agreed between the parties per transaction. Natural gas purchased under these agreements is initially recorded as inventory and then to cost of sales—affiliate upon its sale, except for purchases related to commissioning
activities which are capitalized as LNG terminal construction-in-process. Additionally, SPLNG is able to sell and purchase natural gas and LNG under agreements with Cheniere Marketing.
(3)We do not have employees and thus our subsidiaries have various services agreements with affiliates of Cheniere in the ordinary course of business, including services required to construct, operate and maintain the Liquefaction Project, and administrative services. Our payment structures under the services agreements primarily consist of cost reimbursement plus a compensating fee based on a fixed amount (indexed for inflation) per Train in service. Prior to the substantial completion of a Train, a compensating fee is charged based on a percentage of the capital expenditures of the Train under construction. The non-reimbursement amounts incurred under these agreements are recorded in general and administrative expense—affiliate.
(4)These arrangements were with a party who was partially owned by the investment management company that indirectly owns a portion of our limited partner interests, and, due to the sale of such interests by that entity effective May 13, 2025, this party is no longer considered a related party as of that date. Prior to the sale, SPL was party to various natural gas transportation and storage agreements and CTPL was party to an operational balancing agreement with this party in the ordinary course of business for the operation of the Liquefaction Project.
(5)Represents the amount of cumulative income allocated to certain of our subsidiaries by an affiliate, to whom our subsidiaries advance payments so that the affiliate may pay operating expenses on their behalf pursuant to their operating and maintenance agreements. The affiliate in turn temporarily invests such funds into interest and dividend earning deposit accounts, from which they allocated the historically earned income to our subsidiaries effective June 30, 2025. The affiliate currently allocates such income to our subsidiaries in the same period the affiliate earns such interest and dividend income.

Assets and liabilities arising from the agreements with affiliates and other related parties referenced in the above table are classified as affiliate and related party, respectively, on our Consolidated Balance Sheets.

Disclosures relating to future consideration under revenue contracts with affiliates is included in Note 12—Revenues.
Other Agreements

Terminal Marine Services Agreement

In connection with its tug boat leases, Tug Services entered into an agreement with Cheniere Terminals to provide its LNG cargo vessels with tug boat and marine services at the Sabine Pass LNG Terminal. The agreement also provides that Tug Services shall contingently pay Cheniere Terminals a portion of its future revenues. Under this agreement, Tug Services distributed $13 million during each of the years ended December 31, 2025, 2024 and 2023, respectively, to Cheniere Terminals, which is recognized as part of the distributions to our general partner interest holders on our Consolidated Statements of Partners’ Equity (Deficit).

State Tax Sharing Agreements

SPLNG, SPL and CTPL each have a state tax sharing agreement with Cheniere. Under these agreements, Cheniere has agreed to prepare and file all state and local tax returns which each of the entities and Cheniere are required to file on a combined basis and to timely pay the combined state and local tax liability. If Cheniere, in its sole discretion, demands payment, each of the respective entities will pay to Cheniere an amount equal to the state and local tax that each of the entities would be required to pay if its state and local tax liability were calculated on a separate company basis. To date, there have been no state and local tax payments demanded by Cheniere under the tax sharing agreements. The agreements for SPLNG, SPL and CTPL are effective for tax returns due on or after January 2008, August 2012 and May 2013, respectively.
Cooperative Endeavor Agreements

SPLNG executed Cooperative Endeavor Agreements (“CEAs”) with various Cameron Parish, Louisiana taxing authorities that allowed them to collect certain advanced payments of annual ad valorem taxes from SPLNG from 2007 through 2016. This initiative represented an aggregate commitment of $25 million over 10 years in order to aid in their reconstruction efforts following Hurricane Rita. In exchange for SPLNG’s advance payments of annual ad valorem taxes, Cameron Parish granted SPLNG a dollar-for-dollar credit against future ad valorem taxes to be levied against the Sabine Pass LNG Terminal as
early as 2019. In 2018, SPLNG entered into a Memorandum of Understanding, which forgave approximately $7.5 million of the dollar-for-dollar credits, and in 2022, an agreement was reached to defer the commencement of the dollar-for-dollar credits until 2027. As of both December 31, 2025 and 2024, we had $17 million of amounts associated with dollar-for-dollar credits due on advance tax payments to the taxing authorities recorded to other non-current assets on our Consolidated Balance Sheets. Beginning in September 2007, SPLNG entered into various agreements with Cheniere Marketing, pursuant to which Cheniere Marketing would pay SPLNG additional TUA revenues equal to any and all amounts payable by SPLNG to the Cameron Parish taxing authorities under the CEAs. In exchange for such amounts received as TUA revenues from Cheniere Marketing, SPLNG will make payments to Cheniere Marketing equal to the dollar-for-dollar credit applied to the ad valorem tax levied against the Sabine Pass LNG Terminal. We had $17 million of other non-current liabilities—affiliate as of both December 31, 2025 and 2024 from these payments received from Cheniere Marketing.