Annual report pursuant to Section 13 and 15(d)

Property, Plant and Equipment, Net of Accumulated Depreciation

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Property, Plant and Equipment, Net of Accumulated Depreciation
 12 Months Ended
Dec. 31, 2023
Property, Plant and Equipment [Abstract]  
Property, Plant and Equipment, Net of Accumulated Depreciation PROPERTY, PLANT AND EQUIPMENT, NET OF ACCUMULATED DEPRECIATION
 
Property, plant and equipment, net of accumulated depreciation consisted of the following (in millions):
December 31,
2023 2022
LNG terminal    
Terminal and interconnecting pipeline facilities $ 20,176  $ 20,072 
Construction-in-process 189  140 
Accumulated depreciation (4,173) (3,512)
Total LNG terminal, net of accumulated depreciation 16,192  16,700 
Fixed assets  
Fixed assets 29  29 
Accumulated depreciation (26) (25)
Total fixed assets, net of accumulated depreciation 3  4 
Assets under finance leases
Tug vessels 23  23 
Accumulated depreciation (6) (2)
Total assets under finance leases, net of accumulated depreciation 17  21 
Property, plant and equipment, net of accumulated depreciation $ 16,212  $ 16,725 

The following table shows depreciation expense and offsets to LNG terminal costs (in millions):
Year Ended December 31,
2023 2022 2021
Depreciation expense $ 667  $ 630  $ 552 
Offsets to LNG terminal costs (1) —  148  105 
(1)We recognize offsets to LNG terminal costs related to the sale of commissioning cargoes because these amounts were earned or loaded prior to the start of commercial operations of the respective Trains of the Liquefaction Project during the testing phase for its construction.
LNG Terminal Costs

The Sabine Pass LNG Terminal is depreciated using the straight-line depreciation method applied to groups of LNG terminal assets with varying useful lives. The identifiable components of the Sabine Pass LNG Terminal have depreciable lives between 6 and 50 years, as follows:
Components Useful life (years)
LNG storage tanks 50
Natural gas pipeline facilities 40
Marine berth, electrical, facility and roads 35
Water pipelines 30
Regasification processing equipment 30
Sendout pumps 20
Liquefaction processing equipment
6-50
Other
10-30

Fixed Assets

Our fixed assets are recorded at cost and are depreciated on a straight-line method based on estimated lives of the individual assets or groups of assets.

Assets under Finance Leases

Our assets under finance leases consists of certain tug vessels that meet the classification of a finance lease. These assets are depreciated on a straight-line method over the respective lease term. See Note 12—Leases for additional details of our finance leases.