Annual report pursuant to Section 13 and 15(d)

Leases

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Leases
 12 Months Ended
Dec. 31, 2023
Leases [Abstract]  
Leases LEASES
Our leased assets consist primarily of LNG vessels leased under time charters (“vessel charters”) and additionally include tug vessels, office space and facilities and land sites. All of our leases are classified as operating leases except for certain of our vessel charters, tug vessels and marine equipment, which are classified as finance leases.

The following table shows the classification and location of our right-of-use assets and lease liabilities on our Consolidated Balance Sheets (in millions):
December 31,
Consolidated Balance Sheets Location 2023 2022
Right-of-use assets—Operating Operating lease assets $ 2,641  $ 2,625 
Right-of-use assets—Financing Property, plant and equipment, net of accumulated depreciation 469  511 
Total right-of-use assets $ 3,110  $ 3,136 
Current operating lease liabilities Current operating lease liabilities $ 655  $ 616 
Current finance lease liabilities Other current liabilities 35  28 
Non-current operating lease liabilities Operating lease liabilities 1,971  1,971 
Non-current finance lease liabilities Finance lease liabilities 467  494 
Total lease liabilities $ 3,128  $ 3,109 

The following table shows the classification and location of our lease costs on our Consolidated Statements of Operations (in millions):
Consolidated Statements of Operations Location
 Year Ended December 31,
2023 2022 2021
Operating lease cost (a) Operating costs and expenses (1) $ 783  $ 828  $ 621 
Finance lease cost:
Amortization of right-of-use assets Depreciation and amortization expense 50  12  3 
Interest on lease liabilities Interest expense, net of capitalized interest 35  14  9 
Total lease cost $ 868  $ 854  $ 633 
(a) Included in operating lease cost:
Short-term lease costs $ 33  $ 122  $ 139 
Variable lease costs 17  18  21 
(1)Presented in the appropriate line item within operating costs and expenses, consistent with the nature of the asset under lease.
Future annual minimum lease payments for operating and finance leases as of December 31, 2023 are as follows (in millions): 
Years Ending December 31, Operating Leases Finance Leases
2024 $ 752  $ 67 
2025 612  72 
2026 480  75 
2027 383  77 
2028 228  73 
Thereafter 638  355 
Total lease payments (1) 3,093  719 
Less: Interest (467) (217)
Present value of lease liabilities $ 2,626  $ 502 
(1)Does not include approximately $3.8 billion of legally binding minimum payments for vessel charters executed as of December 31, 2023 that will commence in future periods with fixed minimum lease terms of up to 15 years.

The following table shows the weighted-average remaining lease term and the weighted-average discount rate for our operating leases and finance leases:
December 31, 2023 December 31, 2022
Operating Leases Finance Leases Operating Leases Finance Leases
Weighted-average remaining lease term (in years) 6.3 9.7 5.9 10.6
Weighted-average discount rate (1) 4.7% 7.7% 4.2% 7.8%
(1)The weighted average discount rate is impacted by certain finance leases that commenced prior to the adoption of the current leasing standard under GAAP. In accordance with previous accounting guidance, the implied rate is based on the fair value of the underlying assets.

The following table includes other quantitative information for our operating and finance leases (in millions):
Year Ended December 31,
2023 2022 2021
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases $ 720  $ 713  $ 483 
Operating cash flows from finance leases 35  14  10 
Financing cash flows from finance leases 28  7  — 
Right-of-use assets obtained in exchange for operating lease liabilities 646  1,220  1,736 
Right-of-use assets obtained in exchange for finance lease liabilities (1) 8  473  — 
(1)     Includes $88 million reclassified from operating leases to finance leases during the year ended December 31, 2022 as a result of modification of the underlying vessel charters.

LNG Vessel Subcharters

We sublease certain LNG vessels under charter to third parties while retaining our existing obligation to the original lessor. All of our sublease arrangements have been assessed as operating leases. The following table shows the sublease income recognized in other revenues on our Consolidated Statements of Operations (in millions):
Year Ended December 31,
2023 2022 2021
Fixed income $ 446  $ 371  $ 72 
Variable income 57  79  37 
Total sublease income $ 503  $ 450  $ 109 
Future annual minimum sublease payments to be received from LNG vessel subcharters as of December 31, 2023 are as follows (in millions): 
Years Ending December 31, Sublease Payments
2024 $ 158 
2025 5 
Total sublease payments $ 163