Quarterly report pursuant to Section 13 or 15(d)

Supplemental Guarantor Information

v3.10.0.1
Supplemental Guarantor Information
9 Months Ended
Sep. 30, 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 10—Debt in this quarterly report and Note 11—Debt of our Notes to Consolidated Financial Statements in our annual report on Form 10-K for the year ended December 31, 2017 for additional information regarding the CQP Senior Notes.

The following is condensed consolidating financial information for CQP (“Parent Issuer”), the Guarantors on a combined basis and the Non-Guarantors on a combined basis. We have accounted for investments in subsidiaries using the equity method.

Condensed Consolidating Balance Sheet
September 30, 2018
(in millions)
 
 
 
 
 
 
 
 
 
 
 
Parent Issuer
 
Guarantors
 
Non-Guarantors
 
Eliminations
 
Consolidated
ASSETS
 
 
 
 
 
 
 
 
 
Current assets
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$

 
$

 
$

 
$

 
$

Restricted cash
799

 
9

 
649

 

 
1,457

Accounts and other receivables
1

 
1

 
222

 

 
224

Accounts receivable—affiliate
1

 
46

 
21

 
(46
)
 
22

Advances to affiliate

 
100

 
174

 
(85
)
 
189

Inventory

 
12

 
76

 

 
88

Other current assets
19

 
1

 
35

 

 
55

Other current assets—affiliate

 

 
21

 
(21
)
 

Total current assets
820

 
169

 
1,198

 
(152
)
 
2,035

 
 
 
 
 
 
 
 
 
 
Property, plant and equipment, net
79

 
2,136

 
13,091

 
(24
)
 
15,282

Debt issuance costs, net
1

 

 
14

 

 
15

Non-current derivative assets
9

 

 
16

 

 
25

Investments in subsidiaries
2,449

 
347

 

 
(2,796
)
 

Other non-current assets, net

 
27

 
152

 

 
179

Total assets
$
3,358

 
$
2,679

 
$
14,471

 
$
(2,972
)
 
$
17,536

 
 
 
 
 
 
 
 
 
 
LIABILITIES AND PARTNERS’ EQUITY
 
 
 
 
 
 
 
 
 
Current liabilities
 
 
 
 
 
 
 
 
 
Accounts payable
$
1

 
$
5

 
$
7

 
$

 
$
13

Accrued liabilities
44

 
20

 
439

 

 
503

Due to affiliates

 
132

 
52

 
(131
)
 
53

Deferred revenue

 
24

 
95

 

 
119

Deferred revenue—affiliate

 
21

 

 
(21
)
 

Derivative liabilities

 

 
6

 

 
6

Total current liabilities
45

 
202

 
599

 
(152
)
 
694

 
 
 
 
 
 
 
 
 
 
Long-term debt, net
2,565

 

 
13,494

 

 
16,059

Non-current derivative liabilities

 

 
2

 

 
2

Other non-current liabilities

 
5

 
5

 

 
10

Other non-current liabilities—affiliate

 
23

 

 

 
23

 
 
 
 
 
 
 
 
 
 
Partners’ equity
748

 
2,449

 
371

 
(2,820
)
 
748

Total liabilities and partners’ equity
$
3,358

 
$
2,679

 
$
14,471

 
$
(2,972
)
 
$
17,536


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
Three Months Ended September 30, 2018
(in millions)
 
 
 
 
 
 
 
 
 
 
 
Parent Issuer
 
Guarantors
 
Non-Guarantors
 
Eliminations
 
Consolidated
 
 
 
 
 
 
 
 
 
 
Revenues
 
 
 
 
 
 
 
 
 
LNG revenues
$

 
$

 
$
1,249

 
$

 
$
1,249

LNG revenues—affiliate

 

 
205

 

 
205

Regasification revenues

 
66

 

 

 
66

Regasification revenues—affiliate

 
64

 

 
(64
)
 

Other revenues

 
9

 

 

 
9

Other revenues—affiliate

 
48

 

 
(48
)
 

Total revenues

 
187

 
1,454

 
(112
)
 
1,529

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

 

 
758

 
(2
)
 
756

Cost of sales—affiliate

 

 
8

 
(8
)
 

Operating and maintenance expense

 
17

 
96

 

 
113

Operating and maintenance expense—affiliate

 
39

 
107

 
(115
)
 
31

Development expense

 
1

 

 

 
1

General and administrative expense
1

 
1

 
1

 

 
3

General and administrative expense—affiliate
3

 
6

 
12

 
(3
)
 
18

Depreciation and amortization expense
1

 
19

 
88

 
(1
)
 
107

Impairment expense and loss on disposal of assets

 
8

 

 

 
8

Total operating costs and expenses
5

 
91

 
1,070

 
(129
)
 
1,037

 
 
 
 
 
 
 
 
 
 
Income (loss) from operations
(5
)
 
96

 
384

 
17

 
492

 
 
 
 
 
 
 
 
 
 
Other income (expense)
 
 
 
 
 
 
 
 
 
Interest expense, net of capitalized interest
(36
)
 
(1
)
 
(146
)
 

 
(183
)
Loss on modification or extinguishment of debt
(12
)
 

 

 

 
(12
)
Derivative gain, net
2

 

 

 

 
2

Equity earnings of subsidiaries
354

 
243

 

 
(597
)
 

Other income (expense)
4

 
(1
)
 
5

 

 
8

Total other income (expense)
312

 
241

 
(141
)
 
(597
)
 
(185
)
 
 
 
 
 
 
 
 
 
 
Net income
$
307

 
$
337

 
$
243

 
$
(580
)
 
$
307


Condensed Consolidating Statement of Operations
Three Months Ended September 30, 2017
(in millions)
 
 
 
 
 
 
 
 
 
 
 
Parent Issuer
 
Guarantors
 
Non-Guarantors
 
Eliminations
 
Consolidated
 
 
 
 
 
 
 
 
 
 
Revenues
 
 
 
 
 
 
 
 
 
LNG revenues
$

 
$

 
$
723

 
$

 
$
723

LNG revenues—affiliate

 

 
111

 

 
111

Regasification revenues

 
65

 

 

 
65

Regasification revenues—affiliate

 
48

 

 
(48
)
 

Other revenues

 
3

 

 

 
3

Other revenues—affiliate

 
51

 

 
(50
)
 
1

Total revenues

 
167

 
834

 
(98
)
 
903

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

 
(1
)
 
488

 
3

 
490

Cost of sales—affiliate

 

 
5

 
(5
)
 

Operating and maintenance expense
1

 
7

 
65

 

 
73

Operating and maintenance expense—affiliate
6

 
33

 
82

 
(90
)
 
31

Development expense

 

 
1

 

 
1

General and administrative expense
1

 
1

 
3

 

 
5

General and administrative expense—affiliate
3

 
6

 
12

 
(3
)
 
18

Depreciation and amortization expense
1

 
17

 
69

 

 
87

Other

 
1

 

 

 
1

Total operating costs and expenses
12

 
64

 
725

 
(95
)
 
706

 
 
 
 
 
 
 
 
 
 
Income (loss) from operations
(12
)
 
103

 
109

 
(3
)
 
197

 
 
 
 
 
 
 
 
 
 
Other income (expense)
 
 
 
 
 
 
 
 
 
Interest expense, net of capitalized interest
(29
)
 

 
(124
)
 

 
(153
)
Loss on modification or extinguishment of debt
(25
)
 

 

 

 
(25
)
Derivative gain, net
1

 

 

 

 
1

Equity earnings (losses) of subsidiaries
88

 
(12
)
 

 
(76
)
 

Other income

 

 
3

 

 
3

Total other income (expense)
35

 
(12
)
 
(121
)
 
(76
)
 
(174
)
 
 
 
 
 
 
 
 
 
 
Net income (loss)
$
23

 
$
91

 
$
(12
)
 
$
(79
)
 
$
23


Condensed Consolidating Statement of Operations
Nine Months Ended September 30, 2018
(in millions)
 
 
 
 
 
 
 
 
 
 
 
Parent Issuer
 
Guarantors
 
Non-Guarantors
 
Eliminations
 
Consolidated
 
 
 
 
 
 
 
 
 
 
Revenues
 
 
 
 
 
 
 
 
 
LNG revenues
$

 
$

 
$
3,419

 
$

 
$
3,419

LNG revenues—affiliate

 

 
886

 

 
886

Regasification revenues

 
196

 

 

 
196

Regasification revenues—affiliate

 
194

 

 
(194
)
 

Other revenues

 
28

 

 

 
28

Other revenues—affiliate

 
183

 

 
(183
)
 

Total revenues

 
601

 
4,305

 
(377
)
 
4,529

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

 
2

 
2,291

 
(2
)
 
2,291

Cost of sales—affiliate

 

 
23

 
(23
)
 

Operating and maintenance expense

 
48

 
258

 

 
306

Operating and maintenance expense—affiliate

 
113

 
317

 
(343
)
 
87

Development expense

 
1

 
1

 

 
2

General and administrative expense
3

 
2

 
4

 

 
9

General and administrative expense—affiliate
9

 
17

 
36

 
(9
)
 
53

Depreciation and amortization expense
2

 
56

 
261

 
(1
)
 
318

Impairment expense and loss on disposal of assets

 
8

 

 

 
8

Total operating costs and expenses
14

 
247

 
3,191

 
(378
)
 
3,074

 
 
 
 
 
 
 
 
 
 
Income (loss) from operations
(14
)
 
354

 
1,114

 
1

 
1,455

 
 
 
 
 
 
 
 
 
 
Other income (expense)
 
 
 
 
 
 
 
 
 
Interest expense, net of capitalized interest
(104
)
 
(3
)
 
(445
)
 

 
(552
)
Loss on modification or extinguishment of debt
(12
)
 

 

 

 
(12
)
Derivative gain, net
13

 

 

 

 
13

Equity earnings of subsidiaries
1,030

 
678

 

 
(1,708
)
 

Other income
10

 

 
9

 

 
19

Total other income (expense)
937

 
675

 
(436
)
 
(1,708
)
 
(532
)
 
 
 
 
 
 
 
 
 
 
Net income
$
923

 
$
1,029

 
$
678

 
$
(1,707
)
 
$
923


Condensed Consolidating Statement of Operations
Nine Months Ended September 30, 2017
(in millions)
 
 
 
 
 
 
 
 
 
 
 
Parent Issuer
 
Guarantors
 
Non-Guarantors
 
Eliminations
 
Consolidated
 
 
 
 
 
 
 
 
 
 
Revenues
 
 
 
 
 
 
 
 
 
LNG revenues
$

 
$

 
$
1,718

 
$

 
$
1,718

LNG revenues—affiliate

 

 
864

 

 
864

Regasification revenues

 
195

 

 

 
195

Regasification revenues—affiliate

 
128

 

 
(128
)
 

Other revenues

 
7

 

 

 
7

Other revenues—affiliate

 
162

 

 
(160
)
 
2

Total revenues

 
492

 
2,582

 
(288
)
 
2,786

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

 
1

 
1,576

 
3

 
1,580

Cost of sales—affiliate

 

 
15

 
(15
)
 

Operating and maintenance expense
4

 
29

 
172

 

 
205

Operating and maintenance expense—affiliate
6

 
96

 
224

 
(256
)
 
70

Development expense

 

 
2

 

 
2

General and administrative expense
3

 
2

 
5

 

 
10

General and administrative expense—affiliate
9

 
19

 
46

 
(11
)
 
63

Depreciation and amortization expense
1

 
55

 
183

 

 
239

Other

 
1

 

 

 
1

Total operating costs and expenses
23

 
203

 
2,223

 
(279
)
 
2,170

 
 
 
 
 
 
 
 
 
 
Income (loss) from operations
(23
)
 
289

 
359

 
(9
)
 
616

 
 
 
 
 
 
 
 
 
 
Other income (expense)
 
 
 
 
 
 
 
 
 
Interest expense, net of capitalized interest
(81
)
 

 
(356
)
 

 
(437
)
Loss on modification or extinguishment of debt
(25
)
 

 
(42
)
 

 
(67
)
Derivative loss, net

 

 
(2
)
 

 
(2
)
Equity earnings (losses) of subsidiaries
244

 
(36
)
 

 
(208
)
 

Other income
1

 

 
5

 

 
6

Total other income (expense)
139

 
(36
)
 
(395
)
 
(208
)
 
(500
)
 
 
 
 
 
 
 
 
 
 
Net income (loss)
$
116

 
$
253

 
$
(36
)
 
$
(217
)
 
$
116


Condensed Consolidating Statement of Cash Flows
Nine Months Ended September 30, 2018
(in millions)
 
 
 
 
 
 
 
 
 
 
 
Parent Issuer
 
Guarantors
 
Non-Guarantors
 
Eliminations
 
Consolidated
Cash flows provided by operating activities
$
339

 
$
408

 
$
928

 
$
(411
)
 
$
1,264

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

 
(24
)
 
(554
)
 

 
(578
)
Investments in subsidiaries
(202
)
 
(81
)
 

 
283

 

Distributions received from affiliates, net
447

 
350

 

 
(797
)
 

Net cash provided by (used in) investing activities
245

 
245

 
(554
)
 
(514
)
 
(578
)
 
 
 
 
 
 
 
 
 
 
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
(6
)
 

 

 

 
(6
)
Distributions to parent

 
(858
)
 
(350
)
 
1,208

 

Contributions from parent

 
202

 
81

 
(283
)
 

Distributions to owners
(814
)
 

 

 

 
(814
)
Net cash used in financing activities
(818
)
 
(656
)
 
(269
)
 
925

 
(818
)
 
 
 
 
 
 
 
 
 
 
Net increase (decrease) in cash, cash equivalents and restricted cash
(234
)
 
(3
)
 
105

 

 
(132
)
Cash, cash equivalents and restricted cash—beginning of period
1,033

 
12

 
544

 

 
1,589

Cash, cash equivalents and restricted cash—end of period
$
799

 
$
9

 
$
649

 
$

 
$
1,457



Balances per Condensed Consolidating Balance Sheet:
 
September 30, 2018
 
Parent Issuer
 
Guarantors
 
Non-Guarantors
 
Eliminations
 
Consolidated
Cash and cash equivalents
$

 
$

 
$

 
$

 
$

Restricted cash
799

 
9

 
649

 

 
1,457

Total cash, cash equivalents and restricted cash
$
799

 
$
9

 
$
649

 
$

 
$
1,457


Condensed Consolidating Statement of Cash Flows
Nine Months Ended September 30, 2017
(in millions)
 
 
 
 
 
 
 
 
 
 
 
Parent Issuer
 
Guarantors
 
Non-Guarantors
 
Eliminations
 
Consolidated
Cash flows provided by (used in) operating activities
$
(89
)
 
$
293

 
$
317

 
$
(8
)
 
$
513

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

 
(16
)
 
(1,187
)
 
8

 
(1,195
)
Investments in subsidiaries
(216
)
 
(7
)
 

 
223

 

Distributions received from affiliates, net
929

 
450

 

 
(1,379
)
 

Net cash provided by (used in) investing activities
713

 
427

 
(1,187
)
 
(1,148
)
 
(1,195
)
 
 
 
 
 
 
 
 
 
 
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
(18
)
 

 
(29
)
 

 
(47
)
Distributions to parent

 
(929
)
 
(450
)
 
1,379

 

Contributions from parent

 
216

 
7

 
(223
)
 

Distributions to owners
(74
)
 

 

 

 
(74
)
Net cash provided by (used in) financing activities
(62
)
 
(713
)
 
1,139

 
1,156

 
1,520

 
 
 
 
 
 
 
 
 
 
Net increase in cash, cash equivalents and restricted cash
562

 
7

 
269

 

 
838

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

 
13

 
358

 

 
605

Cash, cash equivalents and restricted cash—end of period
$
796

 
$
20

 
$
627

 
$

 
$
1,443