Related Party Transactions
|9 Months Ended|
Sep. 30, 2020
|Related Party Transactions [Abstract]|
|Related Party Transactions||RELATED PARTY TRANSACTIONS
Natural Gas Supply Agreements
SPL and CCL are party to natural gas supply agreements with related parties in the ordinary course of business, to obtain feed gas for the operation of the Liquefaction Projects.
SPL Natural Gas Supply Agreement
The term of the SPL agreement is for five years, which can commence no earlier than November 1, 2021 and no later than November 1, 2022, following the achievement of contractually-defined conditions precedent. As of September 30, 2020, the notional amount for this agreement was 91 TBtu and had a fair value of zero.
CCL Natural Gas Supply Agreement
The term of the CCL agreement extends through March 2022. Under this agreement, CCL recorded $13 million and $3 million in accrued liabilities, as of September 30, 2020 and December 31, 2019, respectively.
The Liquefaction Supply Derivatives related to this agreement are recorded on our Consolidated Balance Sheets as follows (in millions, except notional amount):
We recorded the following amounts on our Consolidated Statements of Operations during the three and nine months ended September 30, 2020 and 2019 related to this agreement (in millions):
Natural Gas Transportation and Storage Agreements
SPL is party to various natural gas transportation and storage agreements and CTPL is party to an operational balancing agreement with a related party in the ordinary course of business for the operation of the SPL Project, with initial primary terms of up to 10 years with extension rights. We recorded accrued liabilities of $2 million and zero as of September 30, 2020 and December 31, 2019, respectively, related to these agreements.
Operation and Maintenance Service AgreementsCheniere LNG O&M Services, LLC (“O&M Services”), our wholly owned subsidiary, provides the development, construction, operation and maintenance services to Midship Pipeline pursuant to agreements in which O&M Services receives an agreed upon fee and reimbursement of costs incurred. O&M Services recorded $2 million during the both three months ended September 30, 2020 and 2019, and $8 million and $9 million in the nine months ended September 30, 2020 and 2019, respectively, of other revenues and $2 million and $3 million of accounts receivable as of September 30, 2020 and December 31, 2019, respectively, for services provided to Midship Pipeline under these agreements.
The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates.
Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef