Cheniere Energy, Inc. Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

Property, Plant and Equipment

Property, Plant and Equipment

12 Months Ended

Dec. 31, 2018

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment

PROPERTY, PLANT AND EQUIPMENT

As of December 31, 2018 and 2017, property, plant and equipment, net consisted of the following (in millions):



	December 31,
	2018			2017
LNG terminal costs
LNG terminal and interconnecting pipeline facilities	$	13,386		$	12,687
LNG site and related costs	86			86
LNG terminal construction-in-process	14,864			11,932
Accumulated depreciation	(1,299		)	(882		)
Total LNG terminal costs, net	27,037			23,823
Fixed assets and other
Computer and office equipment	17			14
Furniture and fixtures	22			19
Computer software	100			92
Leasehold improvements	41			41
Land	59			59
Other	21			16
Accumulated depreciation	(111		)	(86		)
Total fixed assets and other, net	149			155
Assets under capital lease
Tug vessels	60			—
Accumulated depreciation	(1		)	—
Total assets under capital lease, net	59			—
Property, plant and equipment, net	$	27,245		$	23,978

Depreciation expense was $445 million, $354 million and $173 million during the years ended December 31, 2018, 2017 and 2016, respectively.

We realize offsets to LNG terminal costs for sales of commissioning cargoes that were earned or loaded prior to the start of commercial operations of the respective Train during the testing phase for its construction. We realized offsets to LNG terminal costs of $140 million, $320 million and $214 million in the years ended December 31, 2018, 2017 and 2016, respectively, for sales of commissioning cargoes from the SPL Project and the CCL Project.

LNG Terminal Costs

Our LNG terminals are depreciated using the straight-line depreciation method applied to groups of LNG terminal assets with varying useful lives. The identifiable components of our LNG terminals with similar estimated useful lives have a depreciable range between 6 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
Water pipelines		30
Regasification processing equipment		30
Sendout pumps		20
Liquefaction processing equipment		6-50
Other		15-30

Fixed Assets and Other

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