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

Revenues

v3.25.4
Revenues
 12 Months Ended
Dec. 31, 2025
Revenue from Contract with Customer [Abstract]  
Revenues REVENUES
The following table represents a disaggregation of revenue earned (in millions):
Year Ended December 31,
2025 2024 2023
Revenues from contracts with customers
LNG revenues (excluding net derivative gain (loss) below)
 $ 19,091  $ 14,972  $ 19,459 
Regasification revenues 136  135  135 
     Other revenues (1) 237  307  187 
Total revenues from contracts with customers 19,464  15,414  19,781 
Net derivative gain (loss) (see Note 6)
344  (73) 110 
Sublease income (see Note 11)
145  322  503 
Other revenues 23  40  — 
Total revenues $ 19,976  $ 15,703  $ 20,394 
(1)Includes revenues from LNG vessel subcharters that do not qualify as leases for accounting purposes.
LNG Revenues

We have numerous SPAs with third party customers for the sale of LNG on an FOB basis or a DAP basis. Our customers generally purchase LNG for a price consisting of a fixed fee per MMBtu of LNG (a portion of which is subject to annual adjustment for inflation) plus a variable fee per MMBtu of LNG generally equal to 115% of Henry Hub. The fixed fee component is the amount payable to us regardless of a cancellation or suspension of LNG cargo deliveries by the customers. The variable fee component is the amount generally payable to us only upon delivery of LNG plus all future adjustments to the fixed fee for inflation. The SPAs and contracted volumes to be made available under the SPAs are not tied to a specific Train.

We intend to primarily use LNG sourced from our Sabine Pass LNG Terminal or our Corpus Christi LNG Terminal to provide contracted volumes to our customers. However, we supplement this LNG with volumes procured from third parties. LNG revenues recognized from LNG that was procured from third parties was $226 million, $280 million and $359 million for the years ended December 31, 2025, 2024 and 2023, respectively.

Regasification Revenues

The Sabine Pass LNG Terminal has operational regasification capacity of approximately 4 Bcf/d. Approximately 1 Bcf/d of the regasification capacity at the Sabine Pass LNG Terminal has been reserved under a long-term TUA with TotalEnergies Gas & Power North America, Inc. (“TotalEnergies”) under which they are required to pay fixed monthly fees to SPLNG, regardless of their use of the LNG terminal. The aggregate annual payment of approximately $125 million (indexed for inflation) they are required to pay under the 20 year contract that commenced in 2009 represents fixed consideration. A portion of this fee is adjusted annually for inflation which is considered variable consideration. Approximately 2 Bcf/d of regasification capacity of the Sabine Pass LNG Terminal has been reserved by SPL, for which the associated revenues are eliminated in consolidation.

In 2012, SPL entered into a partial TUA assignment agreement with TotalEnergies, whereby upon substantial completion of Train 5 of the SPL Project, SPL gained access to substantially all of TotalEnergies’ capacity and other services provided under TotalEnergies’ TUA with SPLNG. This agreement provides SPL with additional berthing and storage capacity at the Sabine Pass LNG Terminal that may be used to provide increased flexibility in managing LNG cargo loading and unloading activity and permit SPL to more flexibly manage its LNG storage capacity. Notwithstanding any arrangements between TotalEnergies and SPL, payments required to be made by TotalEnergies to SPLNG will continue to be made by TotalEnergies to SPLNG in accordance with its TUA and we continue to recognize the payments received from TotalEnergies as revenue. Costs incurred to TotalEnergies are recognized in operating and maintenance expense. During the years ended December 31, 2025, 2024 and 2023, SPL recorded $134 million, $133 million and $132 million, respectively, as operating and maintenance expense under this partial TUA assignment agreement.
Contract Assets and Liabilities

The following table shows our contract assets, net of current expected credit losses, which are included in other current assets, net and other non-current assets, net on our Consolidated Balance Sheets (in millions):
December 31,
2025 2024
Contract assets, net of current expected credit losses $ 424  $ 331 

Contract assets include our right to consideration for transferring goods or services to the customer under the terms of a sales contract when the associated consideration is not yet due and have primarily arisen from certain SPAs that have tiered payment structures.

The following table reflects the changes in our contract liabilities, which are included in deferred revenue and other non-current liabilities on our Consolidated Balance Sheets (in millions):
Year Ended December 31, 2025
Deferred revenue, beginning of period $ 318 
Cash received but not yet recognized in revenue 123 
Revenue recognized from prior period deferral (169)
Deferred revenue, end of period $ 272 

We record deferred revenue when we receive consideration, or such consideration is unconditionally due from a customer, prior to transferring goods or services to the customer under the terms of a sales contract. The change in deferred revenue between the years ended December 31, 2025 and 2024 is primarily attributable to differences between the timing of revenue recognition and the receipt of advance payments related to delivery of LNG under certain SPAs.

Transaction Price Allocated to Future Performance Obligations

Because many of our sales contracts have long-term durations, we are contractually entitled to significant future consideration, which we have not yet recognized as revenue. The following table discloses the aggregate amount of the transaction price that is allocated to performance obligations that have not yet been satisfied:
December 31, 2025 December 31, 2024
Unsatisfied Transaction Price (in billions) Weighted Average Recognition Timing (years) (1) Unsatisfied Transaction Price (in billions) Weighted Average Recognition Timing (years) (1)
LNG revenues $ 107.7  8 $ 104.7  8
Regasification revenues 0.4  2 0.5  3
Total revenues $ 108.1  $ 105.2 
(1)The weighted average recognition timing represents an estimate of the number of years during which we shall have recognized half of the unsatisfied transaction price.

The following potential future sources of revenue are omitted from the table above under exemptions we have elected: (1) all performance obligations that are part of a contract that has an original expected duration of one year or less and (2) substantially all variable consideration under our SPAs and TUAs that is allocated entirely to a wholly unsatisfied performance obligation or to a wholly unsatisfied promise to transfer a distinct good or service that forms part of a single performance obligation when that performance obligation qualifies as a series. The amount of revenue from variable fees that is not included in the transaction price, and allocable to wholly unsatisfied future performance obligations or otherwise constrained, will vary based on (1) the future prices of the underlying variable index, primarily Henry Hub, throughout the contract terms, to the extent customers elect to take delivery of their LNG, (2) adjustments to the consumer price index and (3) the outcome of certain contingent events, including the achievement of milestones upon which delivery of LNG under certain contracts is conditioned.
The following table summarizes the percentage of variable consideration earned under contracts with customers included in the table above:
Year Ended December 31,
2025 2024
LNG revenues 67  % 59  %
Regasification revenues 8  % 8  %