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Variable Interest Entity
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6 Months Ended |
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Jun. 30, 2012
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| Variable Interest Entity [Abstract] | |
| Variable Interest Entity |
Variable Interest Entity
In 2010, Cheniere Marketing, LLC ("Cheniere Marketing"), our wholly owned subsidiary, entered into various agreements ("LNGCo Agreements") with JPMorgan LNG Co. ("LNGCo") under which Cheniere Marketing agreed to develop and maintain commercial and trading opportunities in the LNG industry and present any such opportunities exclusively to LNGCo. Cheniere Marketing also agreed to provide, or arrange for the provision of, all of the operations and administrative services required by LNGCo in connection with any LNG cargoes purchased by LNGCo, including negotiating agreements and arranging for transporting, receiving, storing, hedging and regasifying LNG cargoes. In return for the services provided by Cheniere Marketing, LNGCo paid a fixed fee to Cheniere Marketing and additional fees depending upon the gross margin of each transaction. In June 2012, Cheniere Marketing and LNGCo terminated the LNGCo Agreements.
During the three and six months ended June 30, 2012, we recognized $1.5 million and $4.0 million, respectively, of marketing and trading revenues from LNGCo. During the three and six months ended June 30, 2011, we recognized $4.9 million and $7.3 million, respectively, of marketing and trading revenues from LNGCo. As of June 30, 2012, the carrying amount of Cheniere Marketing’s assets relating to LNGCo, which is equivalent to Cheniere Marketing's maximum exposure to loss, was $2.6 million. The $2.6 million represents our fixed fee receivable, gross margin receivable and margin deposit receivable that are reported as accounts and interest receivable on our consolidated financial statements.
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