Annual report [Section 13 and 15(d), not S-K Item 405]

Leases

v3.25.4
Leases
 12 Months Ended
Dec. 31, 2025
Leases [Abstract]  
Leases LEASES
We are the lessee of LNG vessels leased under time charters (“vessel charters”) as well as tug vessels, office space and facilities, land sites and equipment.
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 2025 2024
Right-of-use assets—Operating Operating lease assets $ 2,700  $ 2,684 
Right-of-use assets—Financing Property, plant and equipment, net of accumulated depreciation 861  478 
Total right-of-use assets $ 3,561  $ 3,162 
Current operating lease liabilities Current operating lease liabilities $ 539  $ 592 
Current finance lease liabilities Other current liabilities 88  44 
Non-current operating lease liabilities Operating lease liabilities 2,163  2,090 
Non-current finance lease liabilities Other non-current liabilities 843  486 
Total lease liabilities $ 3,633  $ 3,212 

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,
2025 2024 2023
Operating lease cost (a) Operating costs and expenses (1) $ 796  $ 839  $ 783 
Finance lease cost:
Amortization of right-of-use assets Depreciation, amortization and accretion expense 90  53  50 
Interest on lease liabilities Interest expense, net of capitalized interest 52  35  35 
Total lease cost $ 938  $ 927  $ 868 
(a) Included in operating lease cost:
Short-term lease costs $ 5  $ 16  $ 33 
Variable lease costs 23  14  17 
(1)Presented in the appropriate line item within operating costs and expenses, consistent with the nature of our use of the asset under lease.
Future annual minimum lease payments for operating and finance leases as of December 31, 2025 are as follows (in millions): 
Years Ending December 31, Operating Leases Finance Leases
2026 $ 670  $ 142 
2027 586  143 
2028 404  146 
2029 315  146 
2030 300  146 
Thereafter 1,027  500 
Total lease payments (1) 3,302  1,223 
Less: Interest (600) (292)
Present value of lease liabilities $ 2,702  $ 931 
(1)Does not include approximately $4.3 billion of legally binding minimum payments for leases executed as of December 31, 2025 that will commence in future periods, consisting primarily of vessel charters, 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, 2025 December 31, 2024
Operating Leases Finance Leases Operating Leases Finance Leases
Weighted-average remaining lease term (in years) 7.4 8.5 7.0 8.8
Weighted-average discount rate (1) 5.2% 6.6% 5.0% 7.4%
(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,
2025 2024 2023
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases $ 764  $ 803  $ 720 
Operating cash flows from finance leases 52  35  35 
Financing cash flows from finance leases 73  35  28 
Right-of-use assets obtained in exchange for operating lease liabilities (1) 639  713  646 
Right-of-use assets obtained in exchange for finance lease liabilities (2) 472  61  8 
(1)Net of $33 million reclassified from operating leases to finance leases during the year ended December 31, 2024, as a result of modifications of the underlying tug vessel leases.
(2)Net of $15 million reclassified from finance leases to operating leases during the year ended December 31, 2024, as a result of modifications of the underlying tug vessel leases.

LNG Vessel Subleases

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,
2025 2024 2023
Fixed income $ 90  $ 283  $ 446 
Variable income 55  39  57 
Total sublease income $ 145  $ 322  $ 503 

As of December 31, 2025, the aggregate future annual minimum sublease payment to be received from LNG vessel subleases was $5 million and is expected to be received during the year ending December 31, 2026.