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Derivative Instruments (Tables)
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12 Months Ended |
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Dec. 31, 2014
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| Derivative Instruments and Hedging Activities Disclosures [Line Items] |
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| Fair Value of Derivative Assets and Liabilities |
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 December 31, 2014 and 2013, which are classified as prepaid expenses and other, non-current derivative assets and other current liabilities in our Consolidated Balance Sheets.
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Fair Value Measurements as of |
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December 31, 2014 |
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December 31, 2013 |
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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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|
$ |
1,140 |
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|
$ |
— |
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$ |
1,140 |
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|
$ |
— |
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$ |
(171 |
) |
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$ |
— |
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|
$ |
(171 |
) |
Fuel Derivatives asset (liability) |
— |
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|
(921 |
) |
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— |
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(921 |
) |
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— |
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126 |
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— |
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|
126 |
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Term Gas Supply Derivatives asset |
— |
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— |
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|
342 |
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|
342 |
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— |
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— |
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— |
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— |
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Interest Rate Derivatives asset (liability) |
— |
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(12,036 |
) |
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— |
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(12,036 |
) |
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— |
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84,639 |
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— |
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84,639 |
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| Fair Value Measurements, Sensitivity to Changes in Significant Unobservable Inputs for Level 3 |
The following table (in thousands, except natural gas basis spread) includes quantitative information for the unobservable inputs as of December 31, 2014:
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Net Fair Value Asset |
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Valuation Technique |
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Significant Unobservable Input |
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Significant Unobservable Inputs Range |
Term Gas Supply Derivatives |
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$342 |
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Basis Spread plus Liquid Location |
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Basis Spread |
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$ (0.350) - $0.035 |
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| Fair Value of Derivative Instruments by Balance Sheet Location |
The following table (in thousands) shows the fair value and location of our Commodity Derivatives on our Consolidated Balance Sheets:
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Fair Value Measurements as of |
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Balance Sheet Location |
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December 31, 2014 |
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December 31, 2013 |
LNG Inventory Derivatives asset (liability) |
Prepaid expenses and other |
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$ |
1,140 |
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$ |
(171 |
) |
Fuel Derivatives asset (liability) |
Prepaid expenses and other |
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(921 |
) |
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126 |
|
Term Gas Supply Derivatives asset |
Prepaid expenses and other |
|
76 |
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|
— |
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Term Gas Supply Derivatives asset |
Non-current derivative assets |
|
586 |
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— |
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Term Gas Supply Derivatives liability |
Other current liabilities |
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(53 |
) |
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— |
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Term Gas Supply Derivatives liability |
Other non-current liabilities |
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(267 |
) |
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— |
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| Derivative Instruments, Gain (Loss) |
The following table (in thousands) shows the changes in the fair value and settlements and location of our Commodity Derivatives recorded on our Consolidated Statements of Operations during the years ended December 31, 2014, 2013 and 2012:
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Year Ended December 31, |
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Income Statement Location |
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2014 |
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2013 |
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2012 |
LNG Inventory Derivatives gain (loss) |
Marketing and trading revenues (losses) |
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$ |
(346 |
) |
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$ |
(449 |
) |
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$ |
995 |
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Fuel Derivatives gain (loss) |
Marketing and trading revenues (losses) |
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(952 |
) |
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99 |
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— |
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LNG Inventory Derivatives gain |
Derivative gain (loss), net |
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1,108 |
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|
476 |
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— |
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Fuel Derivatives gain (loss) |
Derivative gain (loss), net |
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281 |
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|
182 |
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(622 |
) |
Term Gas Supply Derivatives gain (1) |
Operating and maintenance expense |
|
342 |
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— |
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— |
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| Schedule of Notional Amounts of Outstanding Derivative Positions |
At December 31, 2014, Sabine Pass Liquefaction had the following Interest Rate Derivatives outstanding:
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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 - Not Designated |
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$20.0 million |
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$2.5 billion |
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August 14, 2012 |
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July 31, 2019 |
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1.98% |
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One-month LIBOR |
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| Schedule of Cash Flow Hedges Included in Accumulated Other Comprehensive Income (Loss) |
The following table (in thousands) details the effect of our Interest Rate Derivatives included in Other Comprehensive Income (“OCI”) and AOCI for the years ended December 31, 2014, 2013 and 2012:
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Gain (Loss) in OCI |
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Gain (Loss) Reclassified from AOCI into Interest Expense (Effective Portion) |
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Losses Reclassified into Earnings as a Result of Discontinuance of Cash Flow Hedge Accounting |
December 31, 2012 |
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Interest Rate Derivatives - Designated |
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$ |
(21,290 |
) |
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$ |
— |
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$ |
— |
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Interest Rate Derivatives - De-designated |
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(5,814 |
) |
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— |
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— |
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Interest Rate Derivatives - Settlements |
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(136 |
) |
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— |
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— |
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December 31, 2013 |
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Interest Rate Derivatives - Designated |
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21,297 |
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— |
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5,807 |
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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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Interest Rate Derivatives - Settlements |
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(30 |
) |
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— |
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166 |
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December 31, 2014 |
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Interest Rate Derivatives - Designated |
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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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Interest Rate Derivatives - Settlements |
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— |
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— |
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— |
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| Derivative Gross Presentation on Consolidated Balance Sheets |
The following table (in thousands) shows the fair value of our derivatives outstanding on a gross and net basis:
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Gross Amounts Recognized |
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Gross Amounts Offset in the Consolidated Balance Sheets |
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Net Amounts Presented in the Consolidated Balance Sheets |
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Gross Amounts Not Offset in the Consolidated Balance Sheets |
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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 December 31, 2014: |
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LNG Inventory Derivatives |
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$ |
1,140 |
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$ |
1,056 |
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$ |
84 |
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$ |
— |
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$ |
— |
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$ |
84 |
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Fuel Derivatives |
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(921 |
) |
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(921 |
) |
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— |
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— |
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— |
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— |
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Term Gas Supply Derivatives |
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662 |
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— |
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662 |
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— |
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— |
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|
662 |
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Term Gas Supply Derivatives |
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(320 |
) |
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— |
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(320 |
) |
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— |
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— |
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(320 |
) |
Interest Rate Derivatives - Not Designated |
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11,158 |
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— |
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11,158 |
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— |
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— |
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11,158 |
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Interest Rate Derivatives - Not Designated |
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(23,194 |
) |
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— |
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(23,194 |
) |
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— |
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— |
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(23,194 |
) |
As of December 31, 2013: |
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LNG Inventory Derivatives |
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(171 |
) |
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(171 |
) |
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— |
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— |
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— |
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— |
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Fuel Derivatives |
|
126 |
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— |
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|
126 |
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— |
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— |
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|
126 |
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Interest Rate Derivatives - Not Designated |
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98,123 |
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— |
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98,123 |
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— |
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— |
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98,123 |
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Interest Rate Derivatives - Not Designated |
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(13,484 |
) |
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— |
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(13,484 |
) |
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— |
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— |
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(13,484 |
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| Interest Rate Contract [Member] |
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| Derivative Instruments and Hedging Activities Disclosures [Line Items] |
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| Fair Value of Derivative Instruments by Balance Sheet Location |
The following table (in thousands) shows the fair value of our Interest Rate Derivatives:
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Fair Value Measurements as of |
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|
Balance Sheet Location |
|
December 31, 2014 |
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December 31, 2013 |
Interest Rate Derivatives - Not Designated |
|
Non-current derivative assets |
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$ |
11,158 |
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$ |
98,123 |
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Interest Rate Derivatives - Not Designated |
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Other current liabilities |
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(23,194 |
) |
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(13,484 |
) |
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| Interest Rate Contract [Member] | Gain (Loss) on Derivative Instruments [Member] |
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| Derivative Instruments and Hedging Activities Disclosures [Line Items] |
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| Derivative Instruments, Gain (Loss) |
The following table (in thousands) shows the changes in the fair value and settlements of our Interest Rate Derivatives - Not Designated recorded in derivative gain (loss), net on our Consolidated Statements of Operations during the years ended December 31, 2014, 2013 and 2012:
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Year Ended December 31, |
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2014 |
|
2013 |
|
2012 |
Interest Rate Derivatives - Not Designated |
$ |
(119,401 |
) |
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$ |
88,596 |
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$ |
679 |
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