Annual report pursuant to Section 13 and 15(d)

Schedule I - Condensed Financial Information of Registrant

v3.20.4
Schedule I - Condensed Financial Information of Registrant
 12 Months Ended
Dec. 31, 2020
Condensed Financial Information Disclosure [Abstract]  
Schedule I - Condensed Financial Information of Registrant
CHENIERE ENERGY, INC.

CONDENSED STATEMENTS OF OPERATIONS
(in millions) 
  Year Ended December 31,
  2020 2019 2018
General and administrative expense $ 20  $ 17  $ 8 
Other income (expense)
Interest expense, net of capitalized interest (155) (141) (128)
Interest income —  1  — 
Loss on modification or extinguishment of debt (50) —  — 
Equity in income of subsidiaries 77  490  607 
Total other income (expense) (128) 350  479 
Income (loss) before income taxes (148) 333  471 
Income tax benefit 63  315  — 
Net income (loss) attributable to common stockholders $ (85) $ 648  $ 471 



































The accompanying notes are an integral part of these condensed financial statements.
CHENIERE ENERGY, INC.

CONDENSED BALANCE SHEETS
(in millions) 
  December 31,
  2020 2019
ASSETS    
Current assets
Cash and cash equivalents $ —  $ 55 
Restricted cash 1  — 
Other current assets 1  1 
Total current assets 2  56 
Property, plant and equipment, net 30  17 
Operating lease assets, net 22  24 
Debt issuance and deferred financing costs, net 15  16 
Investments in subsidiaries 2,324  1,139 
Deferred tax assets, net 381  315 
Total assets $ 2,774  $ 1,567 
LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current liabilities
Current operating lease liabilities $ 5  $ 5 
Current debt 103  — 
Other current liabilities 37  9 
Total current liabilities 145  14 
Long-term debt, net 2,790  1,534 
Non-current operating lease liabilities 30  33 
Stockholders’ deficit (191) (14)
Total liabilities and stockholders’ deficit $ 2,774  $ 1,567 




















The accompanying notes are an integral part of these condensed financial statements.
CHENIERE ENERGY, INC.
CONDENSED STATEMENTS OF CASH FLOWS
(in millions) 
  Year Ended December 31,
  2020 2019 2018
Net cash provided by operating activities $ (285) $ 74  $ 48 
Cash flows from investing activities  
Property, plant and equipment, net (13) (2) — 
Distribution from (investment in) subsidiaries (481) 842  568 
Net cash provided by investing activities (494) 840  568 
Cash flows from financing activities  
Proceeds from issuance of debt 4,778  —  — 
Repayments of debt (3,143) —  — 
Debt issuance and deferred financing costs (57) —  (13)
Debt modification or extinguishment costs (29) —  — 
Distribution and dividends to non-controlling interest (626) (591) (576)
Payments related to tax withholdings for share-based compensation (43) (19) (20)
Repurchase of common stock (155) (249) — 
Other —  —  (7)
Net cash used in financing activities 725  (859) (616)
Net increase in cash, cash equivalents and restricted cash (54) 55  — 
Cash, cash equivalents and restricted cash—beginning of period 55  —  — 
Cash, cash equivalents and restricted cash—end of period $ 1  $ 55  $ — 

Balances per Condensed Balance Sheets:
December 31,
2020 2019
Cash and cash equivalents $ —  $ 55 
Restricted cash 1  — 
Total cash, cash equivalents and restricted cash $ 1  $ 55 




















The accompanying notes are an integral part of these condensed financial statements.
CHENIERE ENERGY, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS

NOTE 1—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The Condensed Financial Statements represent the financial information required by Securities and Exchange Commission Regulation S-X 5-04 for Cheniere.
 
In the Condensed Financial Statements, Cheniere’s investments in affiliates are presented at the net amount attributable to Cheniere. Under this method, the assets and liabilities of affiliates are not consolidated. The investments in net assets of the affiliates are recorded on the Condensed Balance Sheets. The income from operations of the affiliates is reported on a net basis as investment in affiliates (equity in income of subsidiaries).
 
A substantial amount of Cheniere’s operating, investing and financing activities are conducted by its affiliates. The Condensed Financial Statements should be read in conjunction with Cheniere’s Consolidated Financial Statements.

Recent Accounting Standards

In August 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. This guidance simplifies the accounting for convertible instruments primarily by eliminating the existing cash conversion and beneficial conversion models within Subtopic 470-20, which will result in fewer embedded conversion options being accounted for separately from the debt host. The guidance also amends and simplifies the calculation of earnings per share relating to convertible instruments. This guidance is effective for annual periods beginning after December 15, 2021, including interim periods within that reporting period, with earlier adoption permitted for fiscal years beginning after December 15, 2020, including interim periods within that reporting period, using either a full or modified retrospective approach. We are currently evaluating the impact of the provisions of this guidance on our Consolidated Financial Statements and related disclosures.

In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting. This guidance primarily provides temporary optional expedients which simplify the accounting for contract modifications to existing debt agreements expected to arise from the market transition from LIBOR to alternative reference rates. The optional expedients were available to be used upon issuance of this guidance but we have not yet applied the guidance because we have not yet modified any of our existing contracts for reference rate reform. Once we apply an optional expedient to a modified contract and adopt this standard, the guidance will be applied to all subsequent applicable contract modifications until December 31, 2022, at which time the optional expedients are no longer available.
CHENIERE ENERGY, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS—CONTINUED

NOTE 2—DEBT

As of December 31, 2020 and 2019, our debt consisted of the following (in millions): 
December 31,
2020 2019
Long-term debt:
4.625% Senior Secured Notes due 2028 (the “2028 Cheniere Senior Secured Notes”), convertible notes, revolving credit facility (“Cheniere Revolving Credit Facility”) and term loan facility (“Cheniere Term Loan Facility”)
 $ 3,145  $ 1,903 
Unamortized premium, discount and debt issuance costs, net (355) (369)
Total long-term debt, net 2,790  1,534 
Current debt:
Current portion of 4.875% Convertible Unsecured Notes due 2021 (“2021 Cheniere Convertible Unsecured Notes”)
 104 $ — 
Unamortized premium, discount and debt issuance costs, net (1) $ — 
Total current debt 103  — 
Total debt, net $ 2,893  $ 1,534 

Below is a schedule of future principal payments that we are obligated to make on our outstanding debt at December 31, 2020 (in millions): 
Years Ending December 31, Principal Payments
2021 $ 476 
2022 — 
2023 148 
2024 — 
2025 — 
Thereafter 2,625 
Total $ 3,249 
CHENIERE ENERGY, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS—CONTINUED

Issuances and Repayments

The following table shows the issuances and repayments of debt during the year ended December 31, 2020 (in millions):
Issuances and Long-Term Borrowings Principal Amount Issued
2028 Cheniere Senior Secured Notes (1)
 $ 2,000 
Cheniere Term Loan Facility
 2,323 
Cheniere Revolving Credit Facility
 455 
Year Ended December 31, 2020 total
 $ 4,778 
Repayments, Redemptions and Repurchases Amount Repaid/Redeemed/Repurchased
2021 Cheniere Convertible Unsecured Notes (1)
 $ (844)
Cheniere Term Loan Facility (1)
 (2,175)
Cheniere Revolving Credit Facility
 (455)
Year Ended December 31, 2020 total $ (3,474)
(1)Proceeds of the 2028 Cheniere Senior Secured Notes, along with $200 million in available cash, were used to prepay approximately $2.1 billion of the outstanding indebtedness of the Cheniere Term Loan Facility, resulting in the recognition of debt extinguishment costs of $16 million for the year ended December 31, 2020. The borrowings under the Cheniere Term Loan Facility, which was entered in June 2020 with available commitments of $2.62 billion and subsequently increased to $2.695 billion in July 2020, were used to (1) redeem the remaining outstanding principal amount of the 2025 CCH HoldCo II Convertible Senior Notes with cash at a price of $1,080 per $1,000 principal amount, (2) repurchase $844 million in aggregate principal amount of outstanding 2021 Cheniere Convertible Unsecured Notes at individually negotiated prices from a small number of investors and (3) pay the related fees and expenses. The redemption of the 2025 CCH HoldCo II Convertible Senior Notes and the repurchase of the 2021 Cheniere Convertible Unsecured Notes resulted in the recognition of debt extinguishment costs of $149 million and a reduction in equity associated with reacquisition of the embedded conversion option of $10 million.

NOTE 3—GUARANTEES
 
Cheniere has various financial and performance guarantees and indemnifications which are issued in the normal course of business. These contracts include performance guarantees and stand-by letters of credit. Cheniere enters into these arrangements to facilitate commercial transactions with third parties by enhancing the value of the transaction to the third party. As of December 31, 2020, outstanding guarantees and other assurances aggregated approximately $542 million of varying duration, consisting of parental guarantees. No liabilities were recognized under these guarantee arrangements as of December 31, 2020.

NOTE 4—LEASES

Our leased assets consist primarily of office space and facilities, which are classified as operating leases.

The following table shows the classification and location of our right-of-use assets and lease liabilities on our Condensed Balance Sheets (in millions):
December 31,
Condensed Balance Sheet Location 2020 2019
Right-of-use assets—Operating Operating lease assets, net $ 22  $ 24 
Total right-of-use assets $ 22  $ 24 
Current operating lease liabilities Current operating lease liabilities $ 5  $ 5 
Non-current operating lease liabilities Non-current operating lease liabilities 30  33 
Total lease liabilities $ 35  $ 38 
CHENIERE ENERGY, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS—CONTINUED

The following table shows the classification and location of our lease cost on our Condensed Statements of Operations (in millions):
Year Ended December 31,
Condensed Statements of Operations Location 2020 2019
Operating lease cost (1) General and administrative expense $ 10  $ 9 
(1)    Includes $4 million and $3 million of variable lease costs paid to the lessor during the years ended December 31, 2020 and 2019, respectively.

Future annual minimum lease payments for operating leases as of December 31, 2020 are as follows (in millions): 
Years Ending December 31, Operating Leases (1)
2021 $ 7 
2022 8 
2023 8 
2024 7 
2025 6 
Thereafter 7 
Total lease payments 43 
Less: Interest (8)
Present value of lease liabilities $ 35 

The following table shows the weighted-average remaining lease term (in years) and the weighted-average discount rate for our operating leases:
December 31,
2020 2019
Weighted-average remaining lease term (in years) 5.7 6.6
Weighted-average discount rate 6.6% 5.5%

The following table includes other quantitative information for our operating leases (in millions):
Year Ended December 31,
2020 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases $ 7  $ 7 
Right-of-use assets obtained in exchange for new operating lease liabilities 5  1 

NOTE 5—SHARE REPURCHASE PROGRAM

On June 3, 2019, we announced that our Board authorized a 3-year, $1.0 billion share repurchase program. The following table presents information with respect to repurchases of common stock during the years ended December 31, 2020 and 2019:
Year Ended December 31,
2020 2019
Aggregate common stock repurchased 2,875,376  4,000,424 
Weighted average price paid per share $ 53.88  $ 62.27 
Total amount paid (in millions) $ 155  $ 249 

As of December 31, 2020, we had up to $596 million of the share repurchase program available. Under the share repurchase program, repurchases can be made from time to time using a variety of methods, which may include open market purchases, privately negotiated transactions or otherwise, all in accordance with the rules of the SEC and other applicable legal requirements. The timing and amount of any shares of our common stock that are repurchased under the share repurchase program will be determined by our management based on market conditions and other factors.  The share repurchase program
CHENIERE ENERGY, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS—CONTINUED

does not obligate us to acquire any particular amount of common stock, and may be modified, suspended or discontinued at any time or from time to time at our discretion.

NOTE 6 —SUPPLEMENTAL CASH FLOW INFORMATION

The following table provides supplemental disclosure of cash flow information (in millions): 
Year Ended December 31,
2020 2019 2018
Cash paid during the period for interest, net of amounts capitalized $ 45  $ 36  $ 32 
Non-cash investing and financing activities:
Non-cash capital distribution (1) 79  490  607 
Additional interest in Cheniere Holdings acquired —  —  702 
(1)Amounts represent equity income of affiliates.