Quarterly report pursuant to Section 13 or 15(d)

Financial Instruments (Tables)

v2.4.0.8
Financial Instruments (Tables)
9 Months Ended
Sep. 30, 2014
Derivative Instruments and Hedging Activities Disclosures [Line Items]  
Fair Value of Derivative Assets and Liabilities
The following table (in thousands) shows the fair value of our derivative assets and liabilities that are required to be measured at fair value on a recurring basis as of September 30, 2014 and December 31, 2013, which are classified as prepaid expenses and other, non-current derivative assets and other current liabilities in our Consolidated Balance Sheets.
 
Fair Value Measurements as of
 
September 30, 2014
 
December 31, 2013
 
Quoted Prices in Active Markets
(Level 1)
 
Significant Other Observable Inputs (Level 2)
 
Significant Unobservable Inputs (Level 3)
 
Total
 
Quoted Prices in Active Markets
(Level 1)
 
Significant Other Observable Inputs (Level 2)
 
Significant Unobservable Inputs (Level 3)
 
Total
LNG Inventory Derivatives liability
$

 
$
(219
)
 
$

 
$
(219
)
 
$

 
$
(171
)
 
$

 
$
(171
)
Fuel Derivatives asset (liability)

 
(144
)
 

 
(144
)
 

 
126

 

 
126

Interest Rate Derivatives asset

 
15,059

 

 
15,059

 

 
84,639

 

 
84,639

Fair Value of Derivative Instruments by Balance Sheet Location
The following table (in thousands) shows the fair value and location of our LNG Inventory Derivatives and Fuel Derivatives on our Consolidated Balance Sheets:
 
 
 
 
Fair Value Measurements as of
 
Balance Sheet Location
 
September 30, 2014
 
December 31, 2013
LNG Inventory Derivatives liability
Prepaid expenses and other
 
$
(219
)
 
$
(171
)
Fuel Derivatives asset (liability)
Prepaid expenses and other
 
(144
)
 
126

Schedule of Notional Amounts of Outstanding Derivative Positions
At September 30, 2014, Sabine Pass Liquefaction had the following Interest Rate Derivatives outstanding:
 
 
Initial Notional Amount
 
Maximum Notional Amount
 
Effective Date
 
Maturity Date
 
Weighted Average Fixed Interest Rate Paid
 
Variable Interest Rate Received
Interest Rate Derivatives - Not Designated
 
$20.0 million
 
$2.5 billion
 
August 14, 2012
 
July 31, 2019
 
1.98%
 
One-month LIBOR
Schedule of Cash Flow Hedges Included in Accumulated Other Comprehensive Income (Loss)

The following table (in thousands) details the effect of our Interest Rate Derivatives included in Other Comprehensive Income (“OCI”) and AOCI for the nine months ended September 30, 2014 and 2013:
 
Gain (Loss) in Other Comprehensive Income
 
Gain (Loss) Reclassified from AOCI into Interest Expense (Effective Portion)
 
Losses Reclassified into Earnings as a Result of Discontinuance of Cash Flow Hedge Accounting
 
2014
 
2013
 
2014
 
2013
 
2014
 
2013
Interest Rate Derivatives - Designated
$

 
$
21,297

 
$

 
$

 
$

 
$
(5,806
)
Interest Rate Derivatives - Settlements

 
(30
)
 

 

 

 
(167
)
Derivative Gross Presentation on Consolidated Balance Sheets
The following table (in thousands) shows the fair value of our derivatives outstanding on a gross and net basis:
 
 
Gross Amounts Recognized
 
Gross Amounts Offset in the Consolidated Balance Sheets
 
Net Amounts Presented in the Consolidated Balance Sheets
 
Gross Amounts Not Offset in the Consolidated Balance Sheets
 
 
Offsetting Derivative Assets (Liabilities)
 
 
 
 
Derivative Instrument
 
Cash Collateral Received (Paid)
 
Net Amount
As of September 30, 2014:
 
 
 
 
 
 
 
 
 
 
 
 
LNG Inventory Derivatives
 
$
(219
)
 
$
(219
)
 
$

 
$

 
$

 
$

Fuel Derivatives
 
(144
)
 
(144
)
 

 

 

 

Interest Rate Derivatives - Not Designated
 
15,059

 

 
15,059

 

 

 
15,059

As of December 31, 2013:
 
 
 
 
 
 
 
 
 
 
 
 
LNG Inventory Derivatives
 
(171
)
 
(171
)
 

 

 

 

Fuel Derivatives
 
126

 

 
126

 

 

 
126

Interest Rate Derivatives - Not Designated
 
98,123

 

 
98,123

 

 

 
98,123

Interest Rate Derivatives - Not Designated
 
(13,484
)
 

 
(13,484
)
 

 

 
(13,484
)
Schedule of Carrying Values and Estimated Fair Values of Debt Instruments
The following table (in thousands) shows the carrying amount and estimated fair value of our other financial instruments:
 
 
September 30, 2014
 
December 31, 2013
 
 
Carrying
Amount
 
Estimated
Fair Value
 
Carrying
Amount
 
Estimated
Fair Value
2016 Sabine Pass LNG Senior Notes, net of discount (1)
 
$
1,655,328

 
$
1,750,510

 
$
1,651,807

 
$
1,868,607

2020 Sabine Pass LNG Senior Notes (1)
 
420,000

 
432,600

 
420,000

 
432,600

2021 Sabine Pass Liquefaction Senior Notes, net of premium (1)
 
2,010,530

 
2,045,714

 
2,011,562

 
1,961,273

2022 Sabine Pass Liquefaction Senior Notes (1)
 
1,000,000

 
1,042,500

 
1,000,000

 
982,500

2023 Sabine Pass Liquefaction Senior Notes, net of premium (1)
 
1,507,257

 
1,507,257

 
1,000,000

 
935,000

2024 Sabine Pass Liquefaction Senior Notes (1)
 
2,000,000

 
2,010,000

 

 

2013 Liquefaction Credit Facilities (2)
 

 

 
100,000

 
100,000

CTPL Credit Facility, net of discount (3)
 
396,645

 
400,000

 
392,904

 
400,000

 
(1)
The Level 2 estimated fair value was based on quotations obtained from broker-dealers who make markets in these and similar instruments based on the closing trading prices on September 30, 2014 and December 31, 2013, as applicable.
(2)
The Level 3 estimated fair value approximates the carrying amount because the interest rates are variable and reflective of market rates and Sabine Pass Liquefaction has the ability to call this debt at any time without penalty.
(3)
The Level 3 estimated fair value approximates the principal amount because the interest rates are variable and reflective of market rates and CTPL has the ability to call this debt at any time without penalty.
Marketing and trading revenues (losses) [Member]
 
Derivative Instruments and Hedging Activities Disclosures [Line Items]  
Derivative Instruments, Gain (Loss)
The following table (in thousands) shows the changes in the fair value and settlements of our LNG Inventory Derivatives, and Fuel Derivatives recorded in marketing and trading revenues (losses) on our Consolidated Statements of Operations during the three and nine months ended September 30, 2014 and 2013:
 
Three Months Ended September 30,
 
Nine Months Ended September 30,
 
2014
 
2013
 
2014
 
2013
LNG Inventory Derivatives gain (loss)
$
(289
)
 
$
14

 
$
(32
)
 
$
(394
)
Fuel Derivatives loss
(236
)
 
(57
)
 
(123
)
 
(57
)
Derivative gain (loss), net [Member]
 
Derivative Instruments and Hedging Activities Disclosures [Line Items]  
Derivative Instruments, Gain (Loss)
The following table (in thousands) shows the changes in the fair value and settlements of our LNG Inventory Derivatives, and Fuel Derivatives recorded in derivative gain (loss), net on our Consolidated Statements of Operations during the three and nine months ended September 30, 2014 and 2013:
 
Three Months Ended September 30,
 
Nine Months Ended September 30,
 
2014
 
2013
 
2014
 
2013
LNG Inventory Derivatives gain (loss)
$
194

 
$
201

 
$
(345
)
 
$
976

Fuel Derivatives gain (loss)

 
(55
)
 
281

 
(3
)
Interest Rate Contract [Member]
 
Derivative Instruments and Hedging Activities Disclosures [Line Items]  
Fair Value of Derivative Instruments by Balance Sheet Location
The following table (in thousands) shows the fair value of our Interest Rate Derivatives:
 
 
 
 
Fair Value Measurements as of
 
 
Balance Sheet Location
 
September 30, 2014
 
December 31, 2013
Interest Rate Derivatives - Not Designated
 
Non-current derivative assets
 
$
32,161

 
$
98,123

Interest Rate Derivatives - Not Designated
 
Other current liabilities
 
(17,102
)
 
(13,484
)
Interest Rate Contract [Member] | Derivative gain (loss), net [Member]
 
Derivative Instruments and Hedging Activities Disclosures [Line Items]  
Derivative Instruments, Gain (Loss)
The following table (in thousands) shows the changes in the fair value and settlements of our Interest Rate Derivatives - Not Designated recorded in derivative gain (loss), net on our Consolidated Statements of Operations during the three and nine months ended September 30, 2014 and 2013:
 
Three Months Ended September 30,
 
Nine Months Ended September 30,
 
2014
 
2013
 
2014
 
2013
Interest Rate Derivatives - Not Designated
$
5,379

 
$
(22,481
)
 
$
(89,222
)
 
$
60,707