Annual report pursuant to Section 13 and 15(d)

Property, Plant and Equipment

v3.19.3.a.u2
Property, Plant and Equipment
 12 Months Ended
Dec. 31, 2019
Property, Plant and Equipment [Abstract]  
Property, Plant and Equipment PROPERTY, PLANT AND EQUIPMENT
 
As of December 31, 2019 and 2018, property, plant and equipment, net consisted of the following (in millions):
 
 
December 31,
 
 
2019
 
2018
LNG terminal costs
 
 
 
 
LNG terminal and interconnecting pipeline facilities
 
$
27,305

 
$
13,386

LNG site and related costs
 
322

 
86

LNG terminal construction-in-process
 
3,903

 
14,864

Accumulated depreciation
 
(2,049
)
 
(1,299
)
Total LNG terminal costs, net
 
29,481

 
27,037

Fixed assets and other
 
 

 
 

Computer and office equipment
 
23

 
17

Furniture and fixtures
 
22

 
22

Computer software
 
110

 
100

Leasehold improvements
 
42

 
41

Land
 
59

 
59

Other
 
21

 
21

Accumulated depreciation
 
(141
)
 
(111
)
Total fixed assets and other, net
 
136

 
149

Assets under finance lease
 
 
 
 
Tug vessels
 
60

 
60

Accumulated depreciation
 
(4
)
 
(1
)
Total assets under finance lease, net
 
56

 
59

Property, plant and equipment, net
 
$
29,673

 
$
27,245



Depreciation expense was $788 million, $445 million and $354 million during the years ended December 31, 2019, 2018 and 2017, respectively.
We realized offsets to LNG terminal costs of $301 million, $140 million and $320 million during the years ended December 31, 2019, 2018 and 2017, respectively, that were related to the sale of commissioning cargoes because these amounts were earned or loaded prior to the start of commercial operations of the respective Trains of the Liquefaction Projects, during the testing phase for its construction.

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 have depreciable lives between 7 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
 
7-50
Other
 
10-30

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.