Annual report pursuant to Section 13 and 15(d)

Property, Plant and Equipment

v2.4.0.8
Property, Plant and Equipment
 12 Months Ended
Dec. 31, 2013
Property, Plant and Equipment [Abstract]  
Property, Plant and Equipment
PROPERTY, PLANT AND EQUIPMENT
 
Property, plant and equipment consists of LNG terminal costs and fixed assets and other, as follows (in thousands):
 
December 31,
 
2013
 
2012
LNG terminal costs
 
 
 
LNG terminal
$
2,234,796

 
$
2,233,595

LNG terminal construction-in-process
4,489,668

 
1,269,798

LNG site and related costs, net
6,511

 
5,398

Accumulated depreciation
(292,434
)
 
(235,275
)
Total LNG terminal costs, net
6,438,541

 
3,273,516

 
 
 
 
Fixed assets and other
 
 
 
Computer and office equipment
8,115

 
7,014

Furniture and fixtures
4,319

 
4,057

Computer software
13,504

 
13,012

Leasehold improvements
7,303

 
6,989

Other
15,388

 
6,844

Accumulated depreciation
(32,771
)
 
(29,127
)
Total fixed assets, net
15,858

 
8,789

Property, plant and equipment, net
$
6,454,399

 
$
3,282,305


 
LNG Terminal Costs
 
Depreciation expense related to the Sabine Pass LNG terminal totaled $57.3 million, $57.3 million and $57.8 million for the years ended December 31, 2013, 2012 and 2011, respectively.

In June 2012, we began capitalizing costs associated with Trains 1 and 2 of the Sabine Pass Liquefaction Project, and in May 2013, we began capitalizing costs associated with Trains 3 and 4 of the Sabine Pass Liquefaction Project. For the year ended December 31, 2013, and 2012, we capitalized, $188.7 million and $35.1 million, respectively, of interest expense related to the Sabine Pass Liquefaction Project.

The Sabine Pass LNG terminal is depreciated using the straight-line depreciation method applied to groups of LNG terminal assets with varying useful lives. The identifiable components of the Sabine Pass LNG terminal with similar estimated useful lives have a depreciable range between 15 and 50 years, as follows:
Components
 
Useful life (yrs)
LNG storage tanks
 
50
Natural gas pipeline facilities
 
40
Marine berth, electrical, facility and roads
 
35
Regasification processing equipment (recondensers, vaporization and vents)
 
30
Sendout pumps
 
20
Other
 
15-30

We are developing the Corpus Christi Liquefaction Project and have capitalized certain costs associated with our Corpus Christi LNG terminal for site work that improved the associated land.  As of December 31, 2013, and 2012, $35.5 million of costs associated with the initial site work for the Corpus Christi LNG terminal were capitalized as LNG terminal construction-in-process.  

Fixed Assets 

Our fixed assets are recorded at cost and are depreciated on a straight-line method based on estimated lives of the individual assets or groups of assets.