Quarterly report pursuant to Section 13 or 15(d)

Debt

v3.22.1
Debt
 3 Months Ended
Mar. 31, 2022
Debt Disclosure [Abstract]  
Debt DEBT
 
Our debt consisted of the following (in millions): 
March 31, December 31,
2022 2021
SPL:
Senior Secured Notes:
5.625% due 2023
 $ 1,500  $ 1,500 
5.75% due 2024
 2,000  2,000 
5.625% due 2025
 2,000  2,000 
5.875% due 2026
 1,500  1,500 
5.00% due 2027
 1,500  1,500 
4.200% due 2028
 1,350  1,350 
4.500% due 2030
 2,000  2,000 
4.27% weighted average rate due 2037
 1,282  1,282 
Total SPL Senior Secured Notes 13,132  13,132 
$1.2 billion Working Capital Revolving Credit and Letter of Credit Reimbursement Agreement (the “2020 SPL Working Capital Facility”)
 —  — 
Total debt - SPL 13,132  13,132 
CQP:
Senior Notes:
4.500% due 2029
 1,500  1,500 
4.000% due 2031
 1,500  1,500 
3.25% due 2032
 1,200  1,200 
Total CQP Senior Notes 4,200  4,200 
CQP Credit Facilities executed in 2019 (“2019 CQP Credit Facilities”) —  — 
Total debt - CQP 4,200  4,200 
CCH:
Senior Secured Notes:
7.000% due 2024
 1,250  1,250 
5.875% due 2025
 1,500  1,500 
5.125% due 2027
 1,500  1,500 
3.700% due 2029
 1,500  1,500 
3.72% weighted average rate due 2039
 2,721  2,721 
Total CCH Senior Secured Notes 8,471  8,471 
CCH Credit Facility (1) 1,439  1,728 
$1.2 billion CCH Working Capital Facility (“CCH Working Capital Facility”) (2)
 —  250 
Total debt - CCH 9,910  10,449 
Cheniere:
4.625% Senior Secured Notes due 2028
 2,000  2,000 
2045 Cheniere Convertible Senior Notes (3)
 —  625 
$1.25 billion Cheniere Revolving Credit Facility (“Cheniere Revolving Credit Facility”)
 —  — 
Total debt - Cheniere 2,000  2,625 
Cheniere Marketing: trade finance facilities and letter of credit facility (2)
—  — 
Total debt 29,242  30,406 
Current portion of long-term debt (62) (117)
Short-term debt —  (250)
Unamortized premium, discount and debt issuance costs, net (273) (590)
Total long-term debt, net of premium, discount and debt issuance costs $ 28,907  $ 29,449 
(1)A portion of the outstanding balance that is due within one year is classified as current portion of long-term debt.
(2)These debt instruments are classified as short-term debt.
(3)The redemption of these notes was financed with borrowings under the Cheniere Revolving Credit Facility, which is a long-term debt instrument. Therefore, the 2045 Cheniere Convertible Senior Notes were classified as long-term debt as of December 31, 2021. See Convertible Notes section below for further discussion of the redemption.
Credit Facilities

Below is a summary of our committed credit facilities outstanding as of March 31, 2022 (in millions):
2020 SPL Working Capital Facility
2019 CQP Credit Facilities
CCH Credit Facility
CCH Working Capital Facility
Cheniere Revolving Credit Facility
Total facility size $ 1,200  $ 750  $ 1,439  $ 1,200  $ 1,250 
Less:
Outstanding balance —  —  1,439  —  — 
Letters of credit issued 368  —  —  276  — 
Available commitment $ 832  $ 750  $ —  $ 924  $ 1,250 
Priority ranking Senior secured Senior secured Senior secured Senior secured Senior secured
Interest rate on available balance
LIBOR plus 1.125% - 1.750% or base rate plus 0.125% - 0.750%
LIBOR plus 1.25% - 2.125% or base rate plus 0.25% - 1.125%
LIBOR plus 1.75% or base rate plus 0.75% (1)
LIBOR plus 1.25% - 1.75% or base rate plus 0.25% - 0.75% (1)
LIBOR plus 1.250% - 2.375% or base rate plus 0.250% - 1.375% (1)
Weighted average interest rate of outstanding balance n/a n/a 2.21% n/a n/a
Commitment fees on undrawn balance 0.20% 0.49% n/a 0.50% 0.25%
Maturity date March 19, 2025 May 29, 2024 June 30, 2024 June 29, 2023 October 28, 2026
(1)These facilities were amended in 2021 to establish a SOFR-indexed replacement rate for LIBOR.

Convertible Notes

On December 6, 2021, we issued a notice of redemption for all $625 million aggregate principal amount outstanding of the 2045 Cheniere Convertible Senior Notes. The notice of redemption allowed holders to elect to convert their notes at any time prior to a specified deadline on December 31, 2021, with settlement of such converted notes in cash, as elected by us, on January 5, 2022. The impact of holders electing conversion was immaterial to the Consolidated Financial Statements. The 2045 Cheniere Convertible Senior Notes not converted were redeemed on January 5, 2022 with borrowings under the Cheniere Revolving Credit Facility.

Restrictive Debt Covenants

The indentures governing our senior notes and other agreements underlying our debt contain customary terms and events of default and certain covenants that, among other things, may limit us, our subsidiaries’ and its restricted subsidiaries’ ability to make certain investments or pay dividends or distributions. SPL, CQP and CCH are restricted from making distributions under agreements governing their respective indebtedness generally until, among other requirements, deposits are made into any required debt service reserve accounts and a historical debt service coverage ratio and projected debt service coverage ratio of at least 1.25:1.00 is satisfied.

As of March 31, 2022, each of our issuers was in compliance with all covenants related to their respective debt agreements.
Interest Expense

Total interest expense, net of capitalized interest, including interest expense related to our convertible notes, consisted of the following (in millions):
  Three Months Ended March 31,
2022 2021
Interest cost on convertible notes:
Interest per contractual rate $ —  $ 12 
Amortization of debt discount —  5 
Amortization of debt issuance costs —  — 
Total interest cost related to convertible notes —  17 
Interest cost on debt and finance leases excluding convertible notes 372  400 
Total interest cost 372  417 
Capitalized interest (23) (61)
Total interest expense, net of capitalized interest $ 349  $ 356 

Fair Value Disclosures

The following table shows the carrying amount and estimated fair value of our debt (in millions):
  March 31, 2022 December 31, 2021
  Carrying
Amount		 Estimated
Fair Value		 Carrying
Amount		 Estimated
Fair Value
Senior notes — Level 2 (1)
$ 24,550  $ 25,196  $ 24,550  $ 26,725 
Senior notes — Level 3 (2)
3,253  3,356  3,253  3,693 
2045 Cheniere Convertible Senior Notes — Level 1 (3) —  —  625  526 
(1)The Level 2 estimated fair value was based on quotes obtained from broker-dealers or market makers of these senior notes and other similar instruments.
(2)The Level 3 estimated fair value was calculated based on inputs that are observable in the market or that could be derived from, or corroborated with, observable market data, including our stock price and interest rates based on debt issued by parties with comparable credit ratings to us and inputs that are not observable in the market. 
(3)The Level 1 estimated fair value was based on unadjusted quoted prices in active markets for identical liabilities that we had the ability to access at the measurement date.
The estimated fair value of our credit facilities approximates the principal amount outstanding because the interest rates are variable and reflective of market rates and the debt may be repaid, in full or in part, at any time without penalty.