UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, ~~2021~~2022

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 001-16383

CHENIERE ENERGY, INC.

(Exact name of registrant as specified in its charter)


Delaware			95-4352386
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)

700 Milam Street, Suite 1900

Houston, Texas 77002

(Address of principal executive offices) (Zip Code)

(713) 375-5000

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol	Name of each exchange on which registered
Common Stock, $ 0.003 par value	LNG	NYSE American

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of October ~~29, 2021,~~31, 2022, the issuer had ~~253,588,453~~248,659,406 shares of Common Stock outstanding.

CHENIERE ENERGY, INC.

TABLE OF CONTENTS
























	Definitions	1
Part I. Financial Information
Item 1.	Consolidated Financial Statements	3
	Consolidated Statements of Operations	3
	Consolidated Balance Sheets	4
	Consolidated Statements of Stockholders’ Equity (Deficit)	5
	Consolidated Statements of Cash Flows	7
	Notes to Consolidated Financial Statements	8
	Note 1—Nature of Operations and Basis of Presentation	8
	Note 2—Restricted Cas h and Cash Equivalents	9
	Note 3—~~Accounts~~Trade and Other Receivables, Net of Current Expected Credit Losses	910
	Note 4—Inventory	10
	Note 5—Property, Plant and Equipment, Net of Accumulated Depreciation	10
	Note 6—Derivative Instruments	11

	Note 7 —7—Non-Controlling Interest and Variable Interest Entity	1617
	Note 8 —8—Accrued Liabilities	17
	Note 9 —9—Debt	18
	Note 1 0 —10—Leases	2221
	Note 1 1 —11—Revenues ~~from Contracts with Customers~~	2423
	Note 1 2 —12—Related Party Transactions	25
	Note 1 3 —13—Income Taxes	26

	Note 14—Net Loss per Share Attributable to Common Stockholders	27

	Note 15—Stock Repurchase Programs	27
	Note 1 4 ~~—Share-Based Compensation~~	27
	~~Note 1~~5 ~~—Net Income per Share Attributable to Common Stockholders~~	28

	~~Note 1~~6 ~~—Stockholders’ Equity~~16—Customer Concentration	28
	Note 1 7 ~~—Customer Concentration~~	29
	~~Note 1~~8 —17—Supplemental Cash Flow Information	2928

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	3029

Item 3.	Quantitative and Qualitative Disclosures about Market Risk	5243

Item 4.	Controls and Procedures	5344

Part II. Other Information
Item 1.	Legal Proceedings	5445

Item 1A.	Risk Factors	5445

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	5446

Item 6.	Exhibits	5547

	Signatures	5648

Table of Contents

DEFINITIONS

As used in this quarterly report, the terms listed below have the following meanings:

Common Industry and Other Terms


ASU						Accounting Standards Update
Bcf						billion cubic feet
Bcf/d						billion cubic feet per day
Bcf/yr						billion cubic feet per year
Bcfe						billion cubic feet equivalent
DOE						U.S. Department of Energy
EPC						engineering, procurement and construction
FASB						Financial Accounting Standards Board
FERC						Federal Energy Regulatory Commission
FID						final investment decision
FTA countries						countries with which the United States has a free trade agreement providing for national treatment for trade in natural gas
GAAP						generally accepted accounting principles in the United States
Henry Hub						the final settlement price (in USD per MMBtu) for the New York Mercantile Exchange’s Henry Hub natural gas futures contract for the month in which a relevant cargo’s delivery window is scheduled to begin
IPM agreements						integrated production marketing agreements in which the gas producer sells to us gas on a global LNG index price, less a fixed liquefaction fee, shipping and other costs
LIBOR						London Interbank Offered Rate
LNG						liquefied natural gas, a product of natural gas that, through a refrigeration process, has been cooled to a liquid state, which occupies a volume that is approximately 1/600th of its gaseous state
MMBtu						million British thermal units; one British thermal unit measures the amount of energy required to raise the temperature of one pound of water by one degree Fahrenheit
mtpa						million tonnes per annum

non-FTA countries						countries with which the United States does not have a free trade agreement providing for national treatment for trade in natural gas and with which trade is permitted
SEC						U.S. Securities and Exchange Commission
SOFR						Secured Overnight Financing Rate
SPA						LNG sale and purchase agreement
TBtu						trillion British thermal units; one British thermal unit measures the amount of energy required to raise the temperature of one pound of water by one degree Fahrenheit
Train						an industrial facility comprised of a series of refrigerant compressor loops used to cool natural gas into LNG
TUA						terminal use agreement

Table of Contents

Abbreviated Legal Entity Structure

The following diagram depicts our abbreviated legal entity structure as of September 30, ~~2021,~~2022, including our ownership of certain subsidiaries, and the references to these entities used in this quarterly report:

Unless the context requires otherwise, references to “Cheniere,” the “Company,” “we,” “us” and “our” refer to Cheniere Energy, Inc. and its consolidated subsidiaries, including our publicly traded subsidiary, CQP.

In June 2022, as part of the internal restructuring of Cheniere’s subsidiaries, Cheniere ~~Partners.~~

~~Unless the context requires otherwise, references to the “CCH Group” refer~~contributed its equity interest in Corpus Christi Liquefaction Stage III, LLC (“CCL Stage III”), formerly a wholly owned direct subsidiary of Cheniere, to CCH, and CCL Stage III was subsequently merged with and ~~CCP, collectively.~~into CCL, the surviving entity of the merger and a wholly owned subsidiary of CCH.

Table of Contents

PART I. FINANCIAL INFORMATION

ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS

CHENIERE ENERGY, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(in millions, except per share data)

(unaudited)

Three Months Ended September 30, Nine Months Ended September 30,
2021 2020 2021 2020
Revenues
LNG revenues $ 3,078 $ 1,373 $ 8,990 $ 6,236
Regasification revenues 68 67 202 202
Other revenues 54 20 115 133
Total revenues 3,200 1,460 9,307 6,571
Operating costs and expenses
Cost of sales (excluding items shown separately below) 4,868 768 8,408 2,295
Operating and maintenance expense 350 317 1,057 988
Development expense 2 — 5 5
Selling, general and administrative expense 70 70 224 224
Depreciation and amortization expense 259 233 753 699
Impairment expense and loss on disposal of assets 1 — — 5
Total operating costs and expenses 5,550 1,388 10,447 4,216
Income (loss) from operations (2,350) 72 (1,140) 2,355
Other expense
Interest expense, net of capitalized interest (364) (355) (1,088) (1,174)
Loss on modification or extinguishment of debt (36) (171) (95) (215)
Interest rate derivative loss, net (2) — (3) (233)
Other expense, net (24) (129) (14) (115)
Total other expense (426) (655) (1,200) (1,737)
Income (loss) before income taxes and non-controlling interest (2,776) (583) (2,340) 618
Less: income tax provision (benefit) (1,860) (75) (1,864) 119
Net income (loss) (916) (508) (476) 499
Less: net income (loss) attributable to non-controlling interest 168 (45) 544 390
Net income (loss) attributable to common stockholders $ (1,084) $ (463) $ (1,020) $ 109
Net income (loss) per share attributable to common stockholders—basic and diluted $ (4.27) $ (1.84) $ (4.03) $ 0.43
Weighted average number of common shares outstanding—basic 253.6 252.2 253.3 252.5
Weighted average number of common shares outstanding—diluted 253.6 252.2 253.3 253.2


	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Revenues
LNG revenues	$	8,236	$	3,078	$	23,449	$	8,990
Regasification revenues	455		68		591		202
Other revenues	161		54		303		115

Total revenues	8,852		3,200		24,343		9,307

Operating costs and expenses
Cost of sales (excluding items shown separately below)	11,073		4,868		24,161		8,408

Operating and maintenance expense	419		350		1,227		1,057
Development expense	4		2		12		5
Selling, general and administrative expense	92		70		265		224
Depreciation and amortization expense	280		259		827		753


Other	—		1		3		—

Total operating costs and expenses	11,868		5,550		26,495		10,447

Loss from operations	(3,016)		(2,350)		(2,152)		(1,140)

Other income (expense)
Interest expense, net of capitalized interest	(354)		(364)		(1,060)		(1,088)
Gain (loss) on modification or extinguishment of debt	3		(36)		(43)		(95)
Derivative gain (loss), net	—		(2)		2		(3)
Other expense, net	(29)		(24)		(21)		(14)
Total other expense	(380)		(426)		(1,122)		(1,200)

Loss before income taxes and non-controlling interest	(3,396)		(2,776)		(3,274)		(2,340)
Less: income tax benefit	(752)		(1,860)		(762)		(1,864)
Net loss	(2,644)		(916)		(2,512)		(476)
Less: net income (loss) attributable to non-controlling interest	(259)		168		(3)		544
Net loss attributable to common stockholders	$	(2,385)	$	(1,084)	$	(2,509)	$	(1,020)

Net loss per share attributable to common stockholders—basic and diluted (1)	$	(9.54)	$	(4.27)	$	(9.94)	$	(4.03)


Weighted average number of common shares outstanding—basic	249.9		253.6		252.5		253.3
Weighted average number of common shares outstanding—diluted	249.9		253.6		252.5		253.3

(1)Earnings per share in the table may not recalculate exactly due to rounding because it is calculated based on whole numbers, not the rounded numbers presented.

The accompanying notes are an integral part of these consolidated financial statements.

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CHENIERE ENERGY, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS (1)

(in millions, except share data)


		September 30,		December 31,			September 30,		December 31,
		2021		2020			2022		2021
ASSETS	ASSETS	(unaudited)				ASSETS	(unaudited)
Current assets	Current assets					Current assets
Cash and cash equivalents	Cash and cash equivalents	$	2,203	$	1,628	Cash and cash equivalents	$	2,504	$	1,404
Restricted cash		419		449
Accounts and other receivables, net of current expected credit losses		983		647
Restricted cash and cash equivalents						Restricted cash and cash equivalents	834		413
Trade and other receivables, net of current expected credit losses						Trade and other receivables, net of current expected credit losses	1,834		1,506

Inventory	Inventory	471		292		Inventory	1,129		706
Current derivative assets	Current derivative assets	266		32		Current derivative assets	131		55
Margin deposits	Margin deposits	336		25		Margin deposits	267		765
Contract assets						Contract assets	392		5
Other current assets	Other current assets	185		96		Other current assets	115		202
Total current assets	Total current assets	4,863		3,169		Total current assets	7,206		5,056

Property, plant and equipment, net of accumulated depreciation	Property, plant and equipment, net of accumulated depreciation	30,318		30,421		Property, plant and equipment, net of accumulated depreciation	30,904		30,288
Operating lease assets	Operating lease assets	2,064		759		Operating lease assets	2,795		2,102

Derivative assets	Derivative assets	71		376		Derivative assets	46		69
Goodwill	Goodwill	77		77		Goodwill	77		77
Deferred tax assets	Deferred tax assets	2,361		489		Deferred tax assets	2,100		1,204
Other non-current assets, net	Other non-current assets, net	425		406		Other non-current assets, net	514		462
Total assets	Total assets	$	40,179	$	35,697	Total assets	$	43,642	$	39,258

LIABILITIES AND STOCKHOLDERS’ EQUITY
LIABILITIES AND STOCKHOLDERS’ DEFICIT						LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current liabilities	Current liabilities					Current liabilities
Accounts payable	Accounts payable	$	73	$	35	Accounts payable	$	405	$	155
Accrued liabilities	Accrued liabilities	1,787		1,175		Accrued liabilities	3,108		2,299

Current debt, net of discount and debt issuance costs	Current debt, net of discount and debt issuance costs	1,047		372		Current debt, net of discount and debt issuance costs	1,717		366
Deferred revenue	Deferred revenue	187		138		Deferred revenue	211		155
Current operating lease liabilities	Current operating lease liabilities	458		161		Current operating lease liabilities	669		535
Current derivative liabilities	Current derivative liabilities	1,979		313		Current derivative liabilities	3,215		1,089
Other current liabilities	Other current liabilities	129		2		Other current liabilities	50		94
Total current liabilities	Total current liabilities	5,660		2,196		Total current liabilities	9,375		4,693

Long-term debt, net of premium, discount and debt issuance costs	Long-term debt, net of premium, discount and debt issuance costs	29,481		30,471		Long-term debt, net of premium, discount and debt issuance costs	25,325		29,449
Operating lease liabilities	Operating lease liabilities	1,590		597		Operating lease liabilities	2,082		1,541
Finance lease liabilities	Finance lease liabilities	57		57		Finance lease liabilities	75		57

Derivative liabilities	Derivative liabilities	2,158		151		Derivative liabilities	10,954		3,501
Other non-current liabilities	Other non-current liabilities	20		7		Other non-current liabilities	161		50

Stockholders’ equity
Preferred stock, $0.0001 par value, 5.0 million shares authorized, none issued		—		—
Common stock, $0.003 par value, 480.0 million shares authorized; 275.1 million shares and 273.1 million shares issued at September 30, 2021 and December 31, 2020, respectively		1		1
Stockholders’ deficit						Stockholders’ deficit
Preferred stock: $0.0001 par value, 5.0 million shares authorized, none issued						Preferred stock: $0.0001 par value, 5.0 million shares authorized, none issued	—		—
Common stock: $0.003 par value, 480.0 million shares authorized; 276.7 million shares and 275.2 million shares issued at September 30, 2022 and December 31, 2021, respectively						Common stock: $0.003 par value, 480.0 million shares authorized; 276.7 million shares and 275.2 million shares issued at September 30, 2022 and December 31, 2021, respectively	1		1

Treasury stock: 21.6 million shares and 20.8 million shares at September 30, 2021 and December 31, 2020, respectively, at cost		(924)		(872)
Treasury stock: 26.8 million shares and 21.6 million shares at September 30, 2022 and December 31, 2021, respectively, at cost						Treasury stock: 26.8 million shares and 21.6 million shares at September 30, 2022 and December 31, 2021, respectively, at cost	(1,609)		(928)
Additional paid-in-capital	Additional paid-in-capital	4,364		4,273		Additional paid-in-capital	4,309		4,377
Accumulated deficit	Accumulated deficit	(4,698)		(3,593)		Accumulated deficit	(8,880)		(6,021)
Total stockholders' deficit		(1,257)		(191)
Total Cheniere stockholders’ deficit						Total Cheniere stockholders’ deficit	(6,179)		(2,571)
Non-controlling interest	Non-controlling interest	2,470		2,409		Non-controlling interest	1,849		2,538
Total equity		1,213		2,218
Total liabilities and stockholders’ equity		$	40,179	$	35,697
Total stockholders’ deficit						Total stockholders’ deficit	(4,330)		(33)
Total liabilities and stockholders’ deficit						Total liabilities and stockholders’ deficit	$	43,642	$	39,258

(1)Amounts presented include balances held by our consolidated variable interest entity (“VIE”), ~~Cheniere Partners,~~CQP, as further discussed in Note 7 — 7—Non-controlling Interest and Variable Interest Entity. As of September 30, ~~2021,~~2022, total assets and liabilities of ~~Cheniere Partners, which are included in our Consolidated Balance Sheets,~~CQP were ~~$19.6~~$19.9 billion and ~~$19.3~~$24.3 billion, respectively, including ~~$1.7~~$1.0 billion of cash and cash equivalents and ~~$0.1~~$0.2 billion of restricted ~~cash.~~cash and cash equivalents.

The accompanying notes are an integral part of these consolidated financial statements.

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CHENIERE ENERGY, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT)

(in millions)

(unaudited)

Three and Nine Months Ended September 30, 2021
Total Stockholders’ Equity
Common Stock Treasury Stock Additional Paid-in Capital Accumulated Deficit Non-controlling Interest Total
Equity
Shares Par Value Amount Shares Amount
Balance at December 31, 2020 252.3 $ 1 20.8 $ (872) $ 4,273 $ (3,593) $ 2,409 $ 2,218
Vesting of restricted stock units and performance stock units 1.8 — — — — — — —
Share-based compensation — — — — 33 — — 33
Issued shares withheld from employees related to share-based compensation, at cost (0.6) — 0.6 (42) — — — (42)
Net income attributable to non-controlling interest — — — — — — 178 178
Distributions to non-controlling interest — — — — — — (160) (160)
Net income — — — — — 393 — 393
Balance at March 31, 2021 253.5 1 21.4 (914) 4,306 (3,200) 2,427 2,620
Vesting of restricted stock units and performance stock units 0.1 — — — — — — —
Share-based compensation — — — — 31 — — 31
Issued shares withheld from employees related to share-based compensation, at cost — — — (1) — — — (1)
Net income attributable to non-controlling interest — — — — — — 198 198
Distributions to non-controlling interest — — — — — — (162) (162)
Net loss — — — — — (329) — (329)
Balance at June 30, 2021 253.6 1 21.4 (915) 4,337 (3,529) 2,463 2,357
Vesting of restricted stock units and performance stock units 0.1 — — — — — — —
Share-based compensation — — — — 28 — — 28
Issued shares withheld from employees related to share-based compensation, at cost (0.1) — 0.1 (3) (1) — — (4)
Shares repurchased, at cost (0.1) — 0.1 (6) — — — (6)
Net income attributable to non-controlling interest — — — — — — 168 168
Distributions to non-controlling interest — — — — — — (161) (161)
Dividends declared ($0.33 per common share) — — — — — (85) — (85)
Net loss — — — — — (1,084) — (1,084)
Balance at September 30, 2021 253.5 $ 1 21.6 $ (924) $ 4,364 $ (4,698) $ 2,470 $ 1,213


Three and Nine Months Ended September 30, 2022
	Total Stockholders’ Deficit
	Common Stock			Treasury Stock			Additional Paid-in Capital		Accumulated Deficit		Non-controlling Interest		Total Deficit
	Shares	Par Value Amount		Shares	Amount






















Balance at December 31, 2021	253.6	$	1	21.6	$	(928)	$	4,377	$	(6,021)	$	2,538	$	(33)
Vesting of share-based compensation awards	1.3	—		—	—		—		—		—		—
Share-based compensation	—	—		—	—		38		—		—		38
Issued shares withheld from employees related to share-based compensation, at cost	(0.3)	—		0.3	(35)		(18)		—		—		(53)
Shares repurchased, at cost	(0.2)	—		0.2	(25)		—		—		—		(25)
Adoption of ASU 2020-06, net of tax (see Note 1)	—	—		—	—		(153)		4		—		(149)
Net income attributable to non-controlling interest	—	—		—	—		—		—		84		84
Distributions to non-controlling interest	—	—		—	—		—		—		(171)		(171)
Dividends declared and paid ($0.33 per common share)	—	—		—	—		—		(85)		—		(85)
Net loss	—	—		—	—		—		(865)		—		(865)
Balance at March 31, 2022	254.4	1		22.1	(988)		4,244		(6,967)		2,451		(1,259)
Vesting of share-based compensation awards	0.1	—		—	—		—		—		—		—
Share-based compensation	—	—		—	—		34		—		—		34
Issued shares withheld from employees related to share-based compensation, at cost	—	—		—	(1)		(1)		—		—		(2)
Shares repurchased, at cost	(4.1)	—		4.1	(540)		—		—		—		(540)
Net income attributable to non-controlling interest	—	—		—	—		—		—		172		172
Distributions to non-controlling interest	—	—		—	—		—		—		(256)		(256)
Dividends declared and paid ($0.33 per common share)	—	—		—	—		—		(85)		—		(85)
Net income	—	—		—	—		—		741		—		741
Balance at June 30, 2022	250.4	1		26.2	(1,529)		4,277		(6,311)		2,367		(1,195)
Vesting of share-based compensation awards	0.1	—		—	—		—		—		—		—
Share-based compensation	—	—		—	—		34		—		—		34
Issued shares withheld from employees related to share-based compensation, at cost	—	—		—	(5)		(2)		—		—		(7)
Shares repurchased, at cost	(0.6)	—		0.6	(75)		—		—		—		(75)

Net loss attributable to non-controlling interest	—	—		—	—		—		—		(259)		(259)

Distributions to non-controlling interest	—	—		—	—		—		—		(259)		(259)
Dividends declared and paid ($0.33 per common share)	—	—		—	—		—		(81)		—		(81)
Dividends declared and accrued ($0.395 per common share)	—	—		—	—		—		(103)		—		(103)
Net loss	—	—		—	—		—		(2,385)		—		(2,385)
Balance at September 30, 2022	249.9	$	1	26.8	$	(1,609)	$	4,309	$	(8,880)	$	1,849	$	(4,330)

The accompanying notes are an integral part of these consolidated financial statements.

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CHENIERE ENERGY, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ ~~EQUITY—~~EQUITY (DEFICIT)—CONTINUED

(in millions)

(unaudited)


Three and Nine Months Ended September 30, 2020
Three and Nine Months Ended September 30, 2021																						Three and Nine Months Ended September 30, 2021
		Total Stockholders’ Equity																					Total Stockholders’ Equity
		Common Stock			Treasury Stock			Additional Paid-in Capital				Accumulated Deficit			Non-controlling Interest				Total Equity				Common Stock						Treasury Stock			Additional Paid-in Capital			Accumulated Deficit			Non-controlling Interest			Total Equity
		Shares	Par Value Amount		Shares	Amount								Shares								Par Value Amount			Shares			Amount
Balance at December 31, 2019		253.6	$	1	17.1	$	(674)			$	4,167						$	(3,508)			$	2,449		$	2,435
Vesting of restricted stock units and performance stock units		2.1	—		—	—		—				—			—				—
Balance at December 31, 2020																						Balance at December 31, 2020	252.3			$	1		20.8	$	(872)		$	4,273		$	(3,593)		$	2,409		$	2,218
Vesting of share-based compensation awards																						Vesting of share-based compensation awards	1.8			—			—	—		—			—			—			—
Share-based compensation																						Share-based compensation	—			—			—	—		33			—			—			33
Issued shares withheld from employees related to share-based compensation, at cost																						Issued shares withheld from employees related to share-based compensation, at cost	(0.6)			—			0.6	(42)		—			—			—			(42)
Net income attributable to non-controlling interest																						Net income attributable to non-controlling interest	—			—			—	—		—			—			178			178
Distributions to non-controlling interest																						Distributions to non-controlling interest	—			—			—	—		—			—			(160)			(160)
Net income																						Net income	—			—			—	—		—			393			—			393
Balance at March 31, 2021																						Balance at March 31, 2021	253.5			1			21.4	(914)		4,306			(3,200)			2,427			2,620
Vesting of share-based compensation awards																						Vesting of share-based compensation awards	0.1			—			—	—		—			—			—			—
Share-based compensation																						Share-based compensation	—			—			—	—		31			—			—			31
Issued shares withheld from employees related to share-based compensation, at cost																						Issued shares withheld from employees related to share-based compensation, at cost	—			—			—	(1)		—			—			—			(1)
Net income attributable to non-controlling interest																						Net income attributable to non-controlling interest	—			—			—	—		—			—			198			198
Distributions to non-controlling interest																						Distributions to non-controlling interest	—			—			—	—		—			—			(162)			(162)
Net loss																						Net loss	—			—			—	—		—			(329)			—			(329)
Balance at June 30, 2021																						Balance at June 30, 2021	253.6			1			21.4	(915)		4,337			(3,529)			2,463			2,357
Vesting of share-based compensation awards																						Vesting of share-based compensation awards	0.1			—			—	—		—			—			—			—
Share-based compensation	Share-based compensation	—	—		—	—		29				—			—				29			Share-based compensation	—			—			—	—		28			—			—			28
Issued shares withheld from employees related to share-based compensation, at cost	Issued shares withheld from employees related to share-based compensation, at cost	(0.7)	—		0.7	(39)		—				—			—				(39)			Issued shares withheld from employees related to share-based compensation, at cost	(0.1)			—			0.1	(3)		(1)			—			—			(4)
Shares repurchased, at cost	Shares repurchased, at cost	(2.9)	—		2.9	(155)		—				—			—				(155)			Shares repurchased, at cost	(0.1)			—			0.1	(6)		—			—			—			(6)
Net income attributable to non-controlling interest	Net income attributable to non-controlling interest	—	—		—	—		—				—			228				228			Net income attributable to non-controlling interest	—			—			—	—		—			—			168			168
Distributions to non-controlling interest	Distributions to non-controlling interest	—	—		—	—		—				—			(154)				(154)			Distributions to non-controlling interest	—			—			—	—		—			—			(161)			(161)
Net income		—	—		—	—		—				375			—				375
Balance at March 31, 2020		252.1	1		20.7	(868)		4,196				(3,133)			2,523				2,719
Vesting of restricted stock units and performance stock units		0.1	—		—	—		—				—			—				—
Share-based compensation		—	—		—	—		31				—			—				31
Issued shares withheld from employees related to share-based compensation, at cost		—	—		—	(2)		—				—			—				(2)

Net income attributable to non-controlling interest		—	—		—	—		—				—			207				207

Distributions to non-controlling interest		—	—		—	—		—				—			(156)				(156)
Net income		—	—		—	—		—				197			—				197
Balance at June 30, 2020		252.2	1		20.7	(870)		4,227				(2,936)			2,574				2,996
Vesting of restricted stock units and performance stock units		0.1	—		—	—		—				—			—				—
Share-based compensation		—	—		—	—		26				—			—				26
Issued shares withheld from employees related to share-based compensation, at cost		(0.1)	—		0.1	(2)		—				—			—				(2)

Net loss attributable to non-controlling interest		—	—		—	—		—				—			(45)				(45)
Reacquisition of equity component of convertible notes, net of tax		—	—		—	—		(7)				—			—				(7)
Distributions to non-controlling interest		—	—		—	—		—				—			(158)				(158)
Dividends declared and accrued ($0.33 per common share)																						Dividends declared and accrued ($0.33 per common share)	—			—			—	—		—			(85)			—			(85)
Net loss	Net loss	—	—		—	—		—				(463)			—				(463)			Net loss	—			—			—	—		—			(1,084)			—			(1,084)
Balance at September 30, 2020		252.2	$	1	20.8	$	(872)	$	4,246			$	(3,399)		$	2,371			$	2,347
Balance at September 30, 2021																						Balance at September 30, 2021	253.5			$	1		21.6	$	(924)	$	4,364		$	(4,698)		$	2,470		$	1,213

The accompanying notes are an integral part of these consolidated financial statements.

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CHENIERE ENERGY, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in millions)

(unaudited)


		Nine Months Ended September 30,
						Nine Months Ended September 30,
		2021		2020				2022		2021
Cash flows from operating activities	Cash flows from operating activities						Cash flows from operating activities
Net income (loss)		$	(476)	$	499
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Net loss							Net loss	$	(2,512)	$	(476)
Adjustments to reconcile net loss to net cash provided by operating activities:							Adjustments to reconcile net loss to net cash provided by operating activities:
Unrealized foreign currency exchange gain, net							Unrealized foreign currency exchange gain, net	(10)		—
Depreciation and amortization expense	Depreciation and amortization expense	753		699			Depreciation and amortization expense	827		753
Share-based compensation expense	Share-based compensation expense	91		84			Share-based compensation expense	115		91
Non-cash interest expense	Non-cash interest expense	16		43			Non-cash interest expense	14		16
Amortization of debt issuance costs, premium and discount	Amortization of debt issuance costs, premium and discount	57		94			Amortization of debt issuance costs, premium and discount	43		57
Reduction of right-of-use assets	Reduction of right-of-use assets	269		222			Reduction of right-of-use assets	444		269
Loss on modification or extinguishment of debt	Loss on modification or extinguishment of debt	95		215			Loss on modification or extinguishment of debt	43		95
Total losses (gains) on derivatives, net		4,230		(282)
Net cash provided by (used for) settlement of derivative instruments		(486)		61
Impairment expense and loss on disposal of assets		—		5
Impairment expense and loss on equity method investments		16		130
Total losses on derivative instruments, net							Total losses on derivative instruments, net	10,228		4,230
Net cash used for settlement of derivative instruments							Net cash used for settlement of derivative instruments	(702)		(486)

Loss on equity method investments							Loss on equity method investments	55		16
Deferred taxes	Deferred taxes	(1,872)		115			Deferred taxes	(856)		(1,872)
Repayment of paid-in-kind interest related to repurchase of convertible notes	Repayment of paid-in-kind interest related to repurchase of convertible notes	(190)		(911)			Repayment of paid-in-kind interest related to repurchase of convertible notes	(13)		(190)
Other		3		2
Other, net							Other, net	10		3
Changes in operating assets and liabilities:	Changes in operating assets and liabilities:						Changes in operating assets and liabilities:
Accounts and other receivables, net of current expected credit losses		(338)		101
Trade and other receivables, net of current expected credit losses							Trade and other receivables, net of current expected credit losses	(389)		(338)

Inventory	Inventory	(174)		31			Inventory	(426)		(174)
Margin deposits	Margin deposits	(311)		(10)			Margin deposits	498		(311)
Contract assets							Contract assets	(387)		(4)
Other current assets	Other current assets	(92)		(27)			Other current assets	57		(88)
Accounts payable and accrued liabilities	Accounts payable and accrued liabilities	612		(93)			Accounts payable and accrued liabilities	938		612

Deferred revenue		58		18
Operating lease liabilities		(285)		(205)
Finance lease liabilities		1		—
Total deferred revenue							Total deferred revenue	91		58
Total operating lease liabilities							Total operating lease liabilities	(460)		(285)

Other, net	Other, net	80		(26)			Other, net	(37)		81
Net cash provided by operating activities	Net cash provided by operating activities	2,057		765			Net cash provided by operating activities	7,571		2,057

Cash flows from investing activities	Cash flows from investing activities						Cash flows from investing activities
Property, plant and equipment	Property, plant and equipment	(761)		(1,437)			Property, plant and equipment	(1,339)		(761)
Proceeds from sale of fixed assets	Proceeds from sale of fixed assets	68		—			Proceeds from sale of fixed assets	1		68
Investment in equity method investment	Investment in equity method investment	—		(100)			Investment in equity method investment	(10)		—
Other		(14)		(8)
Other, net							Other, net	—		(14)
Net cash used in investing activities	Net cash used in investing activities	(707)		(1,545)			Net cash used in investing activities	(1,348)		(707)

Cash flows from financing activities	Cash flows from financing activities						Cash flows from financing activities
Proceeds from issuances of debt	Proceeds from issuances of debt	4,104		7,683			Proceeds from issuances of debt	1,015		4,104
Repayments of debt		(4,276)		(6,324)
Redemptions and repayments of debt							Redemptions and repayments of debt	(4,005)		(4,276)
Debt issuance and other financing costs	Debt issuance and other financing costs	(38)		(124)			Debt issuance and other financing costs	(44)		(38)
Debt modification or extinguishment costs	Debt modification or extinguishment costs	(67)		(170)			Debt modification or extinguishment costs	(33)		(67)

Distributions to non-controlling interest	Distributions to non-controlling interest	(483)		(468)			Distributions to non-controlling interest	(686)		(483)
Payments related to tax withholdings for share-based compensation	Payments related to tax withholdings for share-based compensation	(47)		(43)			Payments related to tax withholdings for share-based compensation	(62)		(47)
Repurchase of common stock	Repurchase of common stock	(6)		(155)			Repurchase of common stock	(640)		(6)
Other		8		—
Net cash provided by (used in) financing activities		(805)		399
Dividends to shareholders							Dividends to shareholders	(251)		—
Payments of finance lease liabilities							Payments of finance lease liabilities	(1)		—
Other, net							Other, net	—		8
Net cash used in financing activities							Net cash used in financing activities	(4,707)		(805)
Effect of exchange rate changes on cash, cash equivalents and restricted cash and cash equivalents							Effect of exchange rate changes on cash, cash equivalents and restricted cash and cash equivalents	5		—

Net increase (decrease) in cash, cash equivalents and restricted cash		545		(381)
Cash, cash equivalents and restricted cash—beginning of period		2,077		2,994
Cash, cash equivalents and restricted cash—end of period		$	2,622	$	2,613
Net increase in cash, cash equivalents and restricted cash and cash equivalents							Net increase in cash, cash equivalents and restricted cash and cash equivalents	1,521		545
Cash, cash equivalents and restricted cash and cash equivalents—beginning of period							Cash, cash equivalents and restricted cash and cash equivalents—beginning of period	1,817		2,077
Cash, cash equivalents and restricted cash and cash equivalents—end of period							Cash, cash equivalents and restricted cash and cash equivalents—end of period	$	3,338	$	2,622

Balances per Consolidated Balance ~~Sheets:~~

Sheet:


	September 30,
	~~2021~~ 2022
Cash and cash equivalents	$	~~2,203~~2,504
Restricted cash and cash equivalents	~~419~~834

Total cash, cash equivalents and restricted cash and cash equivalents	$	~~2,622~~3,338

The accompanying notes are an integral part of these consolidated financial statements.

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CHENIERE ENERGY, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

NOTE 1—NATURE OF OPERATIONS AND BASIS OF PRESENTATION

We operate 2two natural gas liquefaction and export facilities located in Cameron Parish, Louisiana at Sabine Pass and near Corpus Christi, Texas (respectively, the “Sabine Pass LNG Terminal” and “Corpus Christi LNG Terminal”).

~~Cheniere Partners~~CQP owns the Sabine Pass LNG Terminal ~~located in Cameron Parish, Louisiana,~~ which has natural gas liquefaction facilities consisting of 5six operational ~~natural gas liquefaction~~ Trains, ~~and 1 additional~~with Train ~~that is undergoing commissioning and expected to be substantially completed in the first quarter of~~6 having achieved substantial completion on February 4, 2022, for a total production capacity of approximately 30 mtpa of LNG (the “SPL Project”). The Sabine Pass LNG Terminal also has operational regasification facilities that include 5five LNG storage tanks, vaporizers and 2three marine berths, with ~~an additional marine~~the third berth ~~that is under construction. Cheniere Partners~~having achieved substantial completion on October 27, 2022. CQP also owns a 94-mile pipeline that interconnects the Sabine Pass LNG Terminal with a number of large interstate and intrastate pipelines ~~(the “Creole Trail Pipeline”)~~ through its subsidiary, CTPL. As of September 30, ~~2021,~~2022, we owned 100% of the general partner interest and a 48.6% ~~of the~~ limited partner interest in ~~Cheniere Partners.~~CQP.

The Corpus Christi LNG Terminal ~~is located near Corpus Christi, Texas. We~~ currently ~~operate 3~~has three operational Trains for a total production capacity of approximately 15 mtpa of LNG, three LNG storage tanks and two marine berths. Additionally, we are constructing an expansion of the Corpus Christi LNG Terminal (the “Corpus Christi Stage 3 Project”) for up to seven midscale Trains with an expected total production capacity of over 10 mtpa of LNG. WeCCL Stage III, CCL and CCP received approval from FERC in November 2019 to site, construct and operate the Corpus Christi Stage 3 Project. In March 2022, CCL Stage III issued limited notice to proceed to Bechtel Energy Inc. (“Bechtel”) to commence early engineering, procurement and site works. In June 2022, our board of directors (our “Board”) made a positive FID with respect to the investment in the construction and operation of the Corpus Christi Stage 3 Project and issued a full notice to proceed with construction to Bechtel effective June 16, 2022. In connection with the positive FID, CCL Stage III, through which we were developing and constructing the Corpus Christi Stage 3 Project, was contributed to CCH and subsequently merged with and into CCL, the surviving entity of the merger and a wholly owned subsidiary of CCH. Through our subsidiary CCP, we also own a ~~23-mile~~21.5-mile natural gas supply pipeline that interconnects the Corpus Christi LNG Terminal with several interstate and intrastate natural gas pipelines (the “Corpus Christi Pipeline” and together with the existing operational Trains, midscale Trains, storage tanks and marine berths, the “CCL Project”) ~~through our subsidiary CCP, as part of the CCH Group. The CCL Project also contains 3 LNG storage tanks and 2 marine berths.~~.

Additionally, separate from the CCH Group, we are developing an expansion of the Corpus Christi LNG Terminal adjacent to the CCL Project (“Corpus Christi Stage 3”) through our subsidiary CCL Stage III, for up to 7 midscale Trains with an expected total production capacity of approximately 10 mtpa of LNG. We received approval from FERC in November 2019 to site, construct and operate the expansion project.

~~We remain focused on operational excellence and customer satisfaction. Increasing demand for LNG has allowed us to expand our liquefaction infrastructure in a financially disciplined manner.~~ We have increased available liquefaction capacity at the SPL Project and the CCL Project (collectively, the “Liquefaction Projects”) as a result of debottlenecking and other optimization projects. We hold significant land positions at both the Sabine Pass LNG Terminal and the Corpus Christi LNG Terminal which provide opportunity for further liquefaction capacity expansion. In August 2022, certain of our subsidiaries initiated the pre-filing review process with the FERC under the National Environmental Policy Act for an expansion adjacent to the CCL Project consisting of two midscale Trains with an expected total production capacity of approximately 3 mtpa of LNG. The development of these sites or other projects, including infrastructure projects in support of natural gas supply and LNG demand, will require, among other things, acceptable commercial and financing arrangements before we make a ~~final investment decision (“FID”).~~positive FID.

Basis of Presentation

The accompanying unaudited Consolidated Financial Statements of Cheniere have been prepared in accordance with GAAP for interim financial information and in accordance with Rule 10-01 of Regulation ~~S-X.~~S-X and reflect all normal recurring adjustments which are, in the opinion of management, necessary for a fair statement of the financial results for the interim periods presented. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements and should be read in conjunction with the Consolidated Financial Statements and accompanying notes included in our annual report on Form 10-K for the fiscal year ended December 31, ~~2020~~2021.

Results of operations for the three and nine months ended September 30, ~~2021~~2022 are not necessarily indicative of the results of operations that will be realized for the year ending December 31, ~~2021.~~2022.

Recent Accounting Standards

ASU 2020-06

In August 2020, the ~~Financial Accounting Standards Board (“FASB”)~~FASB issued ~~Accounting Standards Update (“ASU”)~~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

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CHENIERE ENERGY, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

(unaudited)

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 ~~plan to adopt~~

~~CHENIERE ENERGY, INC. AND SUBSIDIARIES~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED~~

~~(unaudited)~~

adopted this guidance on January 1, 2022 using the modified retrospective approach. ~~Preliminarily, we anticipate the~~The adoption of ASU 2020-06 ~~will~~ primarily ~~result~~resulted in the reclassification of the previously bifurcated equity component associated with the 4.25% Convertible Senior Notes due 2045 (the “2045 Cheniere Convertible Senior Notes”) to debt as a result of the elimination of the cash conversion model. ~~We currently estimate that~~As of January 1, 2022, the reclassification resulted in: (1) a $194 million reduction of the ~~$194 million~~ equity component ~~will result~~recorded in ~~an approximate $190~~additional paid-in capital, before offsetting tax effect of $41 million, (2) a $189 million increase in the carrying value of our 2045 Cheniere Convertible Senior Notes ~~with the difference primarily impacting retained earnings as~~and (3) a $5 million decrease in accumulated deficit, before offsetting tax effect of $1 million. In December 2021, we issued a notice of redemption for all $625 million aggregate principal amount outstanding of our 2045 Cheniere Convertible Senior Notes, which were redeemed on January 1,5, 2022. ~~We continue to evaluate the impact of the provisions of this guidance on our Consolidated Financial Statements and related disclosures.~~ See Note 9 —9—Debt for further discussion onof the 2045 Cheniere Convertible Senior Notes.

The adoption of ASU 2020-06 also impacted the calculation of the dilutive effect of our 2045 Cheniere Convertible Senior Notes on our net loss per share for the three and nine months ended September 30, 2022, as further discussed in Note 14—Net Loss per Share Attributable to Common Stockholders.

ASU 2020-04

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 contracts expected to arise from the market transition from LIBOR to alternative reference rates. The standard is effective from March 12, 2020 to December 31, 2022.

We have various credit facilities ~~and interest rate swaps~~ indexed to LIBOR, as further described in Note ~~6—Derivative Instruments~~ ~~and~~ ~~Note~~ 9 —9—Debt. ~~The optional expedients were available to be used upon issuance of this guidance but~~To date, we have ~~not yet applied the guidance because we have not yet modified any~~amended certain of our ~~existing contracts for reference~~credit facilities to incorporate a replacement rate ~~reform. Once we~~or a fallback replacement rate indexed to SOFR as a result of the expected LIBOR transition. We elected to 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.~~as applicable to certain modified facilities; however the impact of applying the optional expedients was not material, and we do not expect the transition to SOFR or other replacement rate indexes to have a material impact on our future cash flows. We intend to apply the optional expedients to qualifying contract modifications in the future; however, we do not expect the impact of such application to be material.

NOTE 2—RESTRICTED CASH AND CASH EQUIVALENTS

Restricted cash ~~consists~~and cash equivalents consist of funds that are contractually or legally restricted as to usage or withdrawal and have been presented separately from cash and cash equivalents on our Consolidated Balance Sheets. ~~As of September 30, 2021~~Restricted cash and ~~December 31, 2020, restricted~~ cash equivalents consisted of the following (in millions):


		September 30,		December 31,			September 30,		December 31,
		2021		2020			2022		2021
Restricted cash
Restricted cash and cash equivalents						Restricted cash and cash equivalents
SPL Project	SPL Project	$	133	$	97	SPL Project	$	195	$	98

CCL Project	CCL Project	59		70		CCL Project	202		44
Cash held by our subsidiaries that is restricted to Cheniere	Cash held by our subsidiaries that is restricted to Cheniere	227		282		Cash held by our subsidiaries that is restricted to Cheniere	437		271
Total restricted cash		$	419	$	449
Total restricted cash and cash equivalents						Total restricted cash and cash equivalents	$	834	$	413

Pursuant to the accounts agreements entered into with the collateral trustees for the benefit of SPL’s debt holders and CCH’s debt holders, SPL and CCH are required to deposit all cash received into reserve accounts controlled by the collateral trustees. The usage or withdrawal of such cash is restricted to the payment of liabilities related to the Liquefaction Projects and other restricted payments. The majority of the cash held by our subsidiaries that is restricted to Cheniere relates to advance funding for operation and construction needs of the Liquefaction Projects.

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CHENIERE ENERGY, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

(unaudited)

NOTE 3—~~ACCOUNTS~~TRADE AND OTHER RECEIVABLES, NET OF CURRENT EXPECTED CREDIT LOSSES

~~As of September 30, 2021 and December 31, 2020, accounts~~Trade and other receivables, net of current expected credit losses consisted of the following (in millions):


		September 30,		December 31,			September 30,		December 31,
		2021		2020			2022		2021
Trade receivables	Trade receivables					Trade receivables
SPL and CCL	SPL and CCL	$	584	$	482	SPL and CCL	$	1,070	$	802

Cheniere Marketing	Cheniere Marketing	272		113		Cheniere Marketing	619		640
Other accounts receivable		127		52

Total accounts and other receivables, net of current expected credit losses		$	983	$	647
Other receivables						Other receivables	145		64
Total trade and other receivables, net of current expected credit losses						Total trade and other receivables, net of current expected credit losses	$	1,834	$	1,506

~~CHENIERE ENERGY, INC. AND SUBSIDIARIES~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED~~

~~(unaudited)~~

NOTE 4—INVENTORY

~~As of September 30, 2021 and December 31, 2020, inventory~~Inventory consisted of the following (in millions):


		September 30,		December 31,			September 30,		December 31,
		2021		2020			2022		2021
Materials		$	168	$	150
LNG in-transit	LNG in-transit	145		88		LNG in-transit	$	652	$	312
LNG	LNG	125		27		LNG	230		153
Materials						Materials	189		174
Natural gas	Natural gas	31		26		Natural gas	55		64
Other	Other	2		1		Other	3		3
Total inventory	Total inventory	$	471	$	292	Total inventory	$	1,129	$	706

NOTE 5—PROPERTY, PLANT AND EQUIPMENT, NET OF ACCUMULATED DEPRECIATION

~~As of September 30, 2021 and December 31, 2020, property,~~Property, plant and equipment, net of accumulated depreciation consisted of the following (in millions):


		September 30,		December 31,			September 30,		December 31,
		2021		2020			2022		2021
LNG terminal	LNG terminal					LNG terminal
LNG terminal and interconnecting pipeline facilities		$	30,617	$	27,475
LNG site and related costs		441		324
LNG terminal construction-in-process		2,817		5,378
Terminal and interconnecting pipeline facilities						Terminal and interconnecting pipeline facilities	$	33,186	$	30,660
Site and related costs						Site and related costs	447		441
Construction-in-process						Construction-in-process	1,868		2,995
Accumulated depreciation	Accumulated depreciation	(3,663)		(2,935)		Accumulated depreciation	(4,715)		(3,912)
Total LNG terminal, net of accumulated depreciation	Total LNG terminal, net of accumulated depreciation	30,212		30,242		Total LNG terminal, net of accumulated depreciation	30,786		30,184
Fixed assets and other	Fixed assets and other					Fixed assets and other
Computer and office equipment	Computer and office equipment	27		25		Computer and office equipment	31		25
Furniture and fixtures	Furniture and fixtures	20		19		Furniture and fixtures	19		20
Computer software	Computer software	122		117		Computer software	123		120
Leasehold improvements	Leasehold improvements	45		45		Leasehold improvements	46		45
Land	Land	1		59		Land	1		1
Other	Other	21		25		Other	19		19
Accumulated depreciation	Accumulated depreciation	(181)		(164)		Accumulated depreciation	(191)		(176)
Total fixed assets and other, net of accumulated depreciation	Total fixed assets and other, net of accumulated depreciation	55		126		Total fixed assets and other, net of accumulated depreciation	48		54
Assets under finance lease	Assets under finance lease					Assets under finance lease
Tug vessels	Tug vessels	60		60		Tug vessels	83		60
Accumulated depreciation	Accumulated depreciation	(9)		(7)		Accumulated depreciation	(13)		(10)
Total assets under finance lease, net of accumulated depreciation	Total assets under finance lease, net of accumulated depreciation	51		53		Total assets under finance lease, net of accumulated depreciation	70		50
Property, plant and equipment, net of accumulated depreciation	Property, plant and equipment, net of accumulated depreciation	$	30,318	$	30,421	Property, plant and equipment, net of accumulated depreciation	$	30,904	$	30,288

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CHENIERE ENERGY, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

(unaudited)

The following table shows depreciation expense and offsets to LNG terminal costs ~~during the three and nine months ended September 30, 2021 and 2020~~ (in millions):


		Three Months Ended September 30,				Nine Months Ended September 30,				Three Months Ended September 30,				Nine Months Ended September 30,
		2021		2020		2021		2020				2022		2021		2022		2021
Depreciation expense	Depreciation expense	$	257	$	231	$	749	$	694		Depreciation expense	$	278	$	257	$	822	$	749
Offsets to LNG terminal costs (1)	Offsets to LNG terminal costs (1)	—		—		227		—			Offsets to LNG terminal costs (1)	—		—		204		227

(1)We recognize offsets to LNG terminal costs 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.

~~CHENIERE ENERGY, INC. AND SUBSIDIARIES~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED~~

~~(unaudited)~~

NOTE 6—DERIVATIVE INSTRUMENTS

We have entered into the following derivative ~~instruments that are reported at fair value:~~instruments:

•interest rate swaps (“~~CCH~~ Interest Rate Derivatives”) to hedge the exposure to volatility in a portion of the floating-rate interest payments on CCH’s amended and restated term loan credit facility (the “CCH Credit Facility”) ~~and previously, to hedge against changes in interest rates that could impact anticipated future issuance of debt by CCH (“CCH Interest Rate Forward Start Derivatives” and, collectively~~, with the ~~CCH~~last of our Interest Rate Derivatives ~~the “Interest Rate Derivatives”);~~expiring in May 2022;

•commodity derivatives consisting of natural gas and power supply contracts, including those under our IPM agreements, for the development, commissioning and operation of the Liquefaction Projects ~~and potential future development of Corpus Christi Stage 3~~ (“Physical Liquefaction Supply Derivatives”) and associated economic hedges (“Financial Liquefaction Supply Derivatives,” and collectively with the Physical Liquefaction Supply Derivatives, the “Liquefaction Supply Derivatives”);

•physical LNG derivatives ~~consisting of liquified natural gas contracts~~ in which we have contractual net settlement (“Physical LNG Trading Derivatives”) and financial derivatives to hedge the exposure to the commodity markets in which we have contractual arrangements to purchase or sell physical LNG (collectively, “LNG Trading Derivatives”); and

•foreign currency exchange (“FX”) contracts to hedge exposure to currency risk associated with cash flows denominated in currencies other than United States dollar (“FX Derivatives”), associated with both LNG Trading Derivatives and operations in countries outside of the United States.

We recognize our derivative instruments as either assets or liabilities and measure those instruments at fair value. None of our derivative instruments are designated as cash flow or fair value hedging instruments, and changes in fair value are recorded within our Consolidated Statements of Operations to the extent not utilized for the commissioning process, in which case ~~it is~~such changes are capitalized.

The following table shows the fair value of our derivative instruments that are required to be measured at fair value on a recurring basis ~~as of September 30, 2021 and December 31, 2020~~ (in millions):

Fair Value Measurements as of
September 30, 2021 December 31, 2020
Quoted Prices in Active Markets
(Level 1) Significant Other Observable Inputs
(Level 2) Significant Unobservable Inputs
(Level 3) Total Quoted Prices in Active Markets
(Level 1) Significant Other Observable Inputs
(Level 2) Significant Unobservable Inputs
(Level 3) Total
CCH Interest Rate Derivatives liability $ — $ (67) $ — $ (67) $ — $ (140) $ — $ (140)
Liquefaction Supply Derivatives asset (liability) (21) 3 (2,611) (2,629) 5 (6) 241 240
LNG Trading Derivatives asset (liability) 11 (444) (680) (1,113) (3) (131) — (134)
FX Derivatives asset (liability) — 9 — 9 — (22) — (22)


	Fair Value Measurements as of
	September 30, 2022								December 31, 2021
	Quoted Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total		Quoted Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
Interest Rate Derivatives liability	$	—	$	—	$	—	$	—	$	—	$	(40)	$	—	$	(40)

Liquefaction Supply Derivatives asset (liability)	(106)		(5)		(13,805)		(13,916)		7		(9)		(4,036)		(4,038)
LNG Trading Derivatives liability	(14)		(113)		—		(127)		(22)		(378)		—		(400)
FX Derivatives asset	—		51		—		51		—		12		—		12

We value our Interest Rate Derivatives using an income-based approach utilizing observable inputs to the valuation model including interest rate curves, risk adjusted discount rates, credit spreads and other relevant data. We value our LNG Trading Derivatives and our Liquefaction Supply Derivatives using a market or option-based approach incorporating present value techniques, as needed, using observable commodity price curves, when available, and other relevant data. We value our FX Derivatives with a market approach using observable FX rates and other relevant data.

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CHENIERE ENERGY, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

(unaudited)

The fair value of our Physical Liquefaction Supply Derivatives and LNG Trading Derivatives are predominantly driven by observable and unobservable market commodity prices and, as applicable to our natural gas supply contracts, our assessment of the associated events deriving fair value, including, ~~evaluating~~but not limited to, evaluation of whether the respective market ~~is available~~exists from the perspective of market participants as ~~pipeline~~ infrastructure is developed. The fair value of our Physical Liquefaction Supply Derivatives incorporates risk premiums related to the satisfaction of conditions precedent, such as completion and placement into service of relevant pipeline infrastructure to accommodate marketable physical gas flow. As of September 30, 2021 and December 31, 2020, some of our Physical

~~CHENIERE ENERGY, INC. AND SUBSIDIARIES~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED~~

~~(unaudited)~~

~~Liquefaction Supply Derivatives existed within markets for which the pipeline infrastructure was under development to accommodate marketable physical gas flow.~~

We include ~~our Physical LNG Trading Derivatives and~~ a significant portion of our Physical Liquefaction Supply Derivatives as Level 3 within the valuation hierarchy as the fair value is developed through the use of internal models which incorporate significant unobservable inputs. In instances where observable data is unavailable, consideration is given to the assumptions that market participants would use in valuing the asset or liability. This includes assumptions about market risks, such as future prices of energy units for unobservable periods, liquidity ~~volatility~~ and ~~contract duration.~~volatility.

The Level 3 fair value measurements of our Physical LNG Trading Derivatives and the natural gas positions within our Physical Liquefaction Supply Derivatives could be materially impacted by a significant change in certain natural gas and international LNG prices. The following table includes quantitative information for the unobservable inputs for our Level 3 Physical Liquefaction Supply Derivatives ~~and Physical LNG Trading Derivatives~~ as of September 30, ~~2021:~~2022:

Net Fair Value Liability
(in millions)

Valuation Approach

Significant Unobservable Input

Range of Significant Unobservable Inputs / Weighted Average (1)

Physical Liquefaction Supply Derivatives

$~~(2,611)~~(13,805)

Market approach incorporating present value techniques

Henry Hub basis spread

$~~(1.333)~~(2.495) - ~~$0.895~~$0.677 / ~~$(0.006)~~$(0.090)

Option pricing model

International LNG pricing spread, relative to Henry Hub (2)

~~158%~~89% - ~~516%~~943% / ~~224%~~197%

~~Physical LNG Trading Derivatives~~

~~$(680)~~

~~Market approach incorporating present value techniques~~

~~International LNG pricing spread, relative to Henry Hub or TTF, as applicable (2)~~

~~$(11.275) - $23.458 / $17.777~~

(1)Unobservable inputs were weighted by the relative fair value of the instruments.

(2)Spread contemplates U.S. dollar-denominated pricing.

Increases or decreases in basis or pricing spreads, in isolation, would decrease or increase, respectively, the fair value of our Physical LNG Trading Derivatives and our Physical Liquefaction Supply Derivatives.

The following table shows the changes in the fair value of our Level 3 Physical LNG Trading Derivatives and Physical Liquefaction Supply Derivatives ~~during the three and nine months ended September 30, 2021 and 2020~~ (in millions):


		Three Months Ended September 30,				Nine Months Ended September 30,				Three Months Ended September 30,				Nine Months Ended September 30,
		2021		2020		2021		2020				2022		2021 (1)		2022		2021 (1)
Balance, beginning of period	Balance, beginning of period	$	(389)	$	590	$	241	$	138		Balance, beginning of period	$	(8,462)	$	(389)	$	(4,036)	$	241
Realized and mark-to-market gains (losses):
Realized and mark-to-market losses:											Realized and mark-to-market losses:
Included in cost of sales	Included in cost of sales	(2,982)		(27)		(2,898)		454			Included in cost of sales	(5,668)		(2,982)		(8,825)		(2,898)

Purchases and settlements:	Purchases and settlements:										Purchases and settlements:
Purchases	Purchases	5		1		(657)		2			Purchases	4		5		(1,390)		(657)
Settlements	Settlements	75		(31)		23		(61)			Settlements	322		75		446		23

Transfers out of Level 3 (2)											Transfers out of Level 3 (2)	(1)		—		—		—
Balance, end of period	Balance, end of period	$	(3,291)	$	533	$	(3,291)	$	533		Balance, end of period	$	(13,805)	$	(3,291)	$	(13,805)	$	(3,291)
Change in unrealized gains (losses) relating to instruments still held at end of period		$	(2,982)	$	(27)	$	(2,898)	$	454
Change in unrealized losses relating to instruments still held at end of period											Change in unrealized losses relating to instruments still held at end of period	$	(5,668)	$	(2,982)	$	(8,825)	$	(2,898)

(1)Includes amounts recorded related to natural gas supply contracts that CCL had with a related party. The agreement ceased to be considered a related party agreement during 2021, as discussed in Note 12—Related Party Transactions.

(2)Transferred out of Level 3 as a result of unobservable market for the underlying natural gas purchase agreements.

~~All~~Except for Interest Rate Derivatives, all counterparty derivative contracts provide for the unconditional right of set-off in the event of default. We have elected to report derivative assets and liabilities arising from ~~our~~those derivative contracts with the same counterparty and the unconditional contractual right of set-off on a net basis. The use of derivative instruments exposes us to counterparty credit risk, or the risk that a counterparty will be unable to meet its commitments, in instances when our derivative instruments are in an asset position. Additionally, counterparties are at risk that we will be unable to meet our commitments in instances where our derivative instruments are in a liability position. We incorporate both our own

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CHENIERE ENERGY, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

(unaudited)

nonperformance risk and the respective counterparty’s nonperformance risk in fair value ~~measurements.~~measurements depending on the position of the derivative. In adjusting the fair value of our derivative contracts for the effect of nonperformance risk, we have considered the impact of any applicable credit enhancements, such as collateral postings, set-off rights and guarantees.

~~CHENIERE ENERGY, INC. AND SUBSIDIARIES~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED~~

~~(unaudited)~~

Interest Rate Derivatives

CCH ~~has~~previously entered into ~~interest rate swaps~~the following Interest Rate Derivatives to protect against volatility of future cash flows and hedge a portion of the variable interest payments on the CCH Credit ~~Facility. CCH previously also had interest rate swaps to hedge against changes~~Facility, which expired in ~~interest rates that could impact the anticipated future issuance of debt. In August 2020, we settled the outstanding CCH Interest Rate Forward Start Derivatives.~~

~~As of September 30, 2021, we had the following Interest Rate Derivatives outstanding:~~May 2022:

Notional Amounts

September 30, ~~2021~~2022

December 31, ~~2020~~2021

~~Latest Maturity Date~~

Weighted Average Fixed Interest Rate Paid

Variable Interest Rate Received

~~CCH~~ Interest Rate Derivatives

$—

$4.5 billion

~~$4.6 billion~~

~~May 31, 2022~~

2.30%

One-month LIBOR

The following table shows the effect and location of our Interest Rate Derivatives on our Consolidated Statements of Operations ~~during the three and nine months ended September 30, 2021 and 2020~~ (in millions):

Gain (Loss) Recognized in Consolidated Statements of Operations
Consolidated Statements of Operations Location Three Months Ended September 30, Nine Months Ended September 30,
2021 2020 2021 2020
CCH Interest Rate Derivatives Interest rate derivative loss, net $ (2) $ — $ (3) $ (138)
CCH Interest Rate Forward Start Derivatives Interest rate derivative loss, net — — — (95)


		Gain (Loss) Recognized in Consolidated Statements of Operations
	Consolidated Statements of Operations Location	Three Months Ended September 30,				Nine Months Ended September 30,
		2022		2021		2022		2021
Interest Rate Derivatives	Derivative gain (loss), net	$	—	$	(2)	$	2	$	(3)

Commodity Derivatives

SPL ~~CCL~~ and CCL Stage III have entered into physical natural gas supply contracts and associated economic hedges, including those associated with our IPM transactions, to purchase natural gas for the commissioning and operation of thehold Liquefaction ~~Projects and potential future development of Corpus Christi Stage 3, respectively,~~Supply Derivatives which are primarily indexed to the natural gas market and international LNG indices. The remaining minimum terms of the ~~index-based physical natural gas supply contracts~~Physical Liquefaction Supply Derivatives range up to approximately 1525 years, some of which commence upon the satisfaction of certain events or states of affairs. The terms of the Financial Liquefaction Supply Derivatives range up to approximately three years.

Commencing in the first quarter of 2021, ~~we have~~Cheniere Marketing entered into physical LNG transactions that provide for contractual net settlement. Such transactions are accounted for as LNG Trading Derivatives, and are designed to economically hedge exposure to the commodity markets in which we sell LNG. We have historically entered into, and may from time to time enter into, financial LNG Trading Derivatives in the form of swaps, forwards, options or futures. The terms of LNG Trading Derivatives range up to approximately two years.

The following table shows the notional amounts of our Liquefaction Supply Derivatives and LNG Trading Derivatives (collectively, “Commodity Derivatives”):

September 30, 2021 December 31, 2020
Liquefaction Supply Derivatives LNG Trading Derivatives Liquefaction Supply Derivatives LNG Trading Derivatives
Notional amount, net (in TBtu) (1) 11,291 (14) 10,483 20

September 30, 2022

December 31, 2021

Liquefaction Supply Derivatives (1)

LNG Trading Derivatives

Liquefaction Supply Derivatives

LNG Trading Derivatives

Notional amount, net (in TBtu)

13,357

11,238

(1)~~Includes~~Excludes notional amounts ~~for natural gas supply contracts~~associated with extension options that ~~SPL and CCL have with related parties. See~~ ~~Note 1~~2 ~~—Related Party Transactions~~.were uncertain to be taken as of September 30, 2022.

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CHENIERE ENERGY, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

(unaudited)

The following table shows the effect and location of our Commodity Derivatives recorded on our Consolidated Statements of Operations ~~during the three and nine months ended September 30, 2021 and 2020~~ (in millions):


				Gain (Loss) Recognized in Consolidated Statements of Operations																			Gain (Loss) Recognized in Consolidated Statements of Operations
		Consolidated Statements of Operations Location (1)		Three Months Ended September 30,						Nine Months Ended September 30,						Consolidated Statements of Operations Location (1)			Three Months Ended September 30,								Nine Months Ended September 30,
			2021		2020			2021			2020						Consolidated Statements of Operations Location (1)					2022			2021				2022				2021

LNG Trading Derivatives	LNG Trading Derivatives		LNG revenues		$	(1,098)		$	13		$	(1,539)		$	119					LNG Trading Derivatives		LNG revenues			$	(237)			$	(1,098)			$	(454)			$	(1,539)
LNG Trading Derivatives	LNG Trading Derivatives	Cost of sales		55			(5)			136			(5)						LNG Trading Derivatives		Cost of sales			(4)				55				103				136
Liquefaction Supply Derivatives (2)	Liquefaction Supply Derivatives (2)	LNG revenues		(4)			21			(3)			7					Liquefaction Supply Derivatives (2)	LNG revenues				(3)				(4)				8				(3)
Liquefaction Supply Derivatives (2)	Liquefaction Supply Derivatives (2)	Cost of sales		(2,444)			(103)			(2,848)			372					Liquefaction Supply Derivatives (2)	Cost of sales (3)				(5,508)				(2,444)				(10,008)				(2,848)

(1)Fair value fluctuations associated with commodity derivative activities are classified and presented consistently with the item economically hedged and the nature and intent of the derivative instrument.

(2)Does not include the realized value associated with derivative instruments that settle through physical delivery.

(3)Includes amounts recorded related to natural gas supply contracts that CCL had with a related party. The agreement ceased to be considered a related party agreement during 2021, as discussed in Note 12—Related Party Transactions.

FX Derivatives

Cheniere Marketing ~~has entered into~~holds FX Derivatives to protect against the volatility in future cash flows attributable to changes in international currency exchange rates. The FX Derivatives economically hedge the foreign currency exposure arising from cash flows expended for both physical and financial LNG transactions that are denominated in a currency other than the United States dollar. The terms of FX Derivatives range up to approximately one year.

The total notional amount of our FX Derivatives was ~~$499~~$597 million and ~~$786~~$762 million as of September 30, ~~2021~~2022 and December 31, ~~2020,~~2021, respectively.

The following table shows the effect and location of our FX Derivatives recorded on our Consolidated Statements of Operations ~~during the three and nine months ended September 30, 2021 and 2020~~ (in millions):


		Gain Recognized in Consolidated Statements of Operations
	Consolidated Statements of Operations Location	Three Months Ended September 30,				Nine Months Ended September 30,
		2022		2021		2022		2021
FX Derivatives	LNG revenues	$	54	$	11	$	121	$	27

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CHENIERE ENERGY, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

(unaudited)

Fair Value and Location of Derivative Assets and Liabilities on the Consolidated Balance Sheets

The following table shows the fair value and location of our derivative instruments on our Consolidated Balance Sheets (in millions):


		September 30, 2021								September 30, 2022
		CCH Interest Rate Derivatives		Liquefaction Supply Derivatives (1)		LNG Trading Derivatives (2)		FX Derivatives			Total			Interest Rate Derivatives		Liquefaction Supply Derivatives (1)		LNG Trading Derivatives (2)		FX Derivatives		Total
Consolidated Balance Sheets Location	Consolidated Balance Sheets Location												Consolidated Balance Sheets Location
Current derivative assets	Current derivative assets	$	—	$	88	$	163	$	15		$	266	Current derivative assets	$	—	$	50	$	25	$	56	$	131
Derivative assets	Derivative assets	—		71		—		—			71		Derivative assets	—		46		—		—		46
Total derivative assets	Total derivative assets	—		159		163		15			337		Total derivative assets	—		96		25		56		177

Current derivative liabilities	Current derivative liabilities	(67)		(630)		(1,276)		(6)			(1,979)		Current derivative liabilities	—		(3,058)		(152)		(5)		(3,215)
Derivative liabilities	Derivative liabilities	—		(2,158)		—		—			(2,158)		Derivative liabilities	—		(10,954)		—		—		(10,954)
Total derivative liabilities	Total derivative liabilities	(67)		(2,788)		(1,276)		(6)			(4,137)		Total derivative liabilities	—		(14,012)		(152)		(5)		(14,169)

Derivative asset (liability), net	Derivative asset (liability), net	$	(67)	$	(2,629)	$	(1,113)	$	9		$	(3,800)	Derivative asset (liability), net	$	—	$	(13,916)	$	(127)	$	51	$	(13,992)

		December 31, 2020								December 31, 2021
		CCH Interest Rate Derivatives		Liquefaction Supply Derivatives (1)		LNG Trading Derivatives (2)		FX Derivatives			Total			Interest Rate Derivatives		Liquefaction Supply Derivatives (1)		LNG Trading Derivatives (2)		FX Derivatives		Total
Consolidated Balance Sheets Location	Consolidated Balance Sheets Location												Consolidated Balance Sheets Location
Current derivative assets	Current derivative assets	$	—	$	27	$	—	$	5		$	32	Current derivative assets	$	—	$	38	$	2	$	15	$	55
Derivative assets	Derivative assets	—		376		—		—			376		Derivative assets	—		69		—		—		69
Total derivative assets	Total derivative assets	—		403		—		5			408		Total derivative assets	—		107		2		15		124

Current derivative liabilities	Current derivative liabilities	(100)		(54)		(134)		(25)			(313)		Current derivative liabilities	(40)		(644)		(402)		(3)		(1,089)
Derivative liabilities	Derivative liabilities	(40)		(109)		—		(2)			(151)		Derivative liabilities	—		(3,501)		—		—		(3,501)
Total derivative liabilities	Total derivative liabilities	(140)		(163)		(134)		(27)			(464)		Total derivative liabilities	(40)		(4,145)		(402)		(3)		(4,590)

Derivative asset (liability), net	Derivative asset (liability), net	$	(140)	$	240	$	(134)	$	(22)		$	(56)	Derivative asset (liability), net	$	(40)	$	(4,038)	$	(400)	$	12	$	(4,466)

(1)Does not include collateral posted with counterparties by us of ~~$47~~$152 million and $9$20 million as of September 30, 2022 and December 31, 2021, respectively, which are included in margin deposits ~~and other current assets~~ in our Consolidated Balance ~~Sheets as of September 30, 2021 and December 31, 2020, respectively. Includes derivative assets for natural gas supply contracts that SPL and CCL have with related parties. See~~ ~~Note 1~~2 ~~—Related Party Transactions~~.Sheets.

(2)Does not include collateral posted with counterparties by us of ~~$287~~$115 million and $7$745 million, as of September 30, 2022 and December 31, 2021, respectively, which are included in margin deposits ~~and other current assets~~ in our Consolidated Balance ~~Sheets as of September 30, 2021 and December 31, 2020, respectively.~~

Sheets.

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CHENIERE ENERGY, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

(unaudited)

Consolidated Balance Sheets Presentation

~~Our derivative instruments are presented on a net basis on our Consolidated Balance Sheets as described above.~~ The following table shows the fair value of our derivatives outstanding on a gross and net basis (in millions): for our derivative instruments that are presented on a net basis on our Consolidated Balance Sheets:


		CCH Interest Rate Derivatives		Liquefaction Supply Derivatives			LNG Trading Derivatives		FX Derivatives					Liquefaction Supply Derivatives		LNG Trading Derivatives		FX Derivatives
						FX Derivatives						Liquefaction Supply Derivatives	FX Derivatives
As of September 30, 2021
As of September 30, 2022											As of September 30, 2022
Gross assets	Gross assets	$	—	$	179		$	174	$	30	Gross assets			$	108	$	35	$	57
Offsetting amounts	Offsetting amounts	—		(20)			(11)		(15)		Offsetting amounts			(12)		(10)		(1)
Net assets	Net assets	$	—	$	159		$	163	$	15	Net assets			$	96	$	25	$	56

Gross liabilities	Gross liabilities	$	(67)	$	(2,816)		$	(1,427)	$	(34)	Gross liabilities			$	(14,507)	$	(165)	$	(5)
Offsetting amounts	Offsetting amounts	—		28			151		28		Offsetting amounts			495		13		—
Net liabilities	Net liabilities	$	(67)	$	(2,788)		$	(1,276)	$	(6)	Net liabilities			$	(14,012)	$	(152)	$	(5)

As of December 31, 2020
As of December 31, 2021											As of December 31, 2021
Gross assets	Gross assets	$	—	$	452		$	—	$	6	Gross assets			$	155	$	10	$	48
Offsetting amounts	Offsetting amounts	—		(49)			—		(1)		Offsetting amounts			(48)		(8)		(33)
Net assets	Net assets	$	—	$	403		$	—	$	5	Net assets			$	107	$	2	$	15

Gross liabilities	Gross liabilities	$	(140)	$	(184)		$	(163)	$	(62)	Gross liabilities			$	(4,382)	$	(551)	$	(10)
Offsetting amounts	Offsetting amounts	—		21			29		35		Offsetting amounts			237		149		7
Net liabilities	Net liabilities	$	(140)	$	(163)		$	(134)	$	(27)	Net liabilities			$	(4,145)	$	(402)	$	(3)

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CHENIERE ENERGY, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

(unaudited)

NOTE 7—NON-CONTROLLING INTEREST AND VARIABLE INTEREST ENTITY

We own a 48.6% limited partner interest in ~~Cheniere Partners~~CQP in the form of 239.9 million common units, with the remaining non-controlling limited partner interest held by ~~The~~ Blackstone ~~Group~~ Inc., Brookfield Asset Management Inc. and the public. We also own 100% of the general partner interest and the incentive distribution rights in ~~Cheniere Partners. Cheniere Partners~~CQP. CQP is accounted for as a consolidated VIE. ~~See~~ ~~Note 9—Non-Controlling Interest and Variable Interest Entity~~ ~~of our Notes to Consolidated Financial Statements in our~~ ~~annual report on Form 10-K for the fiscal year ended December 31, 2020~~ ~~for further information.~~

~~CHENIERE ENERGY, INC. AND SUBSIDIARIES~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED~~

~~(unaudited)~~

The following table presents the summarized assets and liabilities (in millions) of ~~Cheniere Partners, our consolidated VIE,~~CQP, which are included in our Consolidated Balance ~~Sheets as of September 30, 2021 and December 31, 2020.~~Sheets. The assets in the table below may only be used to settle obligations of ~~Cheniere Partners.~~CQP. In addition, there is no recourse to us for the consolidated VIE’s liabilities. The assets and liabilities in the table below include ~~third-party~~third party assets and liabilities of ~~Cheniere Partners~~CQP only and exclude intercompany balances between CQP and Cheniere that eliminate in ~~consolidation.~~the Consolidated Financial Statements of Cheniere.


		September 30,		December 31,			September 30,		December 31,
		2021		2020			2022		2021
ASSETS	ASSETS					ASSETS
Current assets	Current assets					Current assets
Cash and cash equivalents	Cash and cash equivalents	$	1,713	$	1,210	Cash and cash equivalents	$	988	$	876
Restricted cash		133		97
Accounts and other receivables, net of current expected credit losses		358		318
Restricted cash and cash equivalents						Restricted cash and cash equivalents	195		98
Trade and other receivables, net of current expected credit losses						Trade and other receivables, net of current expected credit losses	805		580
Contract assets						Contract assets	387		—
Other current assets	Other current assets	283		182		Other current assets	401		285
Total current assets	Total current assets	2,487		1,807		Total current assets	2,776		1,839

Property, plant and equipment, net of accumulated depreciation	Property, plant and equipment, net of accumulated depreciation	16,820		16,723		Property, plant and equipment, net of accumulated depreciation	16,827		16,830
Other non-current assets, net	Other non-current assets, net	294		287		Other non-current assets, net	300		316

Total assets	Total assets	$	19,601	$	18,817	Total assets	$	19,903	$	18,985

LIABILITIES	LIABILITIES					LIABILITIES
Current liabilities	Current liabilities					Current liabilities

Accrued liabilities	Accrued liabilities	$	846	$	658	Accrued liabilities	$	1,665	$	1,077
Current debt, net of premium, discount and debt issuance costs		944		—
Current debt, net of discount and debt issuance costs						Current debt, net of discount and debt issuance costs	1,498		—
Other current liabilities	Other current liabilities	216		171		Other current liabilities	1,363		200

Total current liabilities	Total current liabilities	2,006		829		Total current liabilities	4,526		1,277

Long-term debt, net of premium, discount and debt issuance costs	Long-term debt, net of premium, discount and debt issuance costs	17,171		17,580		Long-term debt, net of premium, discount and debt issuance costs	15,699		17,177

Other non-current liabilities	Other non-current liabilities	98		126		Other non-current liabilities	4,081		100
Total liabilities	Total liabilities	$	19,275	$	18,535	Total liabilities	$	24,306	$	18,554

NOTE 8—ACCRUED LIABILITIES

~~As of September 30, 2021 and December 31, 2020, accrued~~Accrued liabilities consisted of the following (in millions):


		September 30,		December 31,			September 30,		December 31,
		2021		2020			2022		2021
Natural gas purchases						Natural gas purchases	$	2,112	$	1,323
Derivative settlements						Derivative settlements	98		329
Interest costs and related debt fees	Interest costs and related debt fees	$	360	$	245	Interest costs and related debt fees	345		214
Accrued natural gas purchases		900		576
LNG terminals and related pipeline costs	LNG terminals and related pipeline costs	126		147		LNG terminals and related pipeline costs	254		144
Compensation and benefits	Compensation and benefits	88		123		Compensation and benefits	109		180
Accrued LNG inventory		3		4
LNG inventory						LNG inventory	8		34
Accrued dividends	Accrued dividends	84		—		Accrued dividends	101		—
Other accrued liabilities	Other accrued liabilities	226		80		Other accrued liabilities	81		75
Total accrued liabilities	Total accrued liabilities	$	1,787	$	1,175	Total accrued liabilities	$	3,108	$	2,299

Table of Contents

CHENIERE ENERGY, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

(unaudited)

NOTE 9—DEBT

~~As of September 30, 2021 and December 31, 2020, our debt~~Debt consisted of the following (in millions):

September 30, December 31,
2021 2020
Long-term debt:
SPL — 4.200% to 6.25% senior secured notes due between March 2022 and September 2037 and working capital facility (“2020 SPL Working Capital Facility”) (1)
$ 13,128 $ 13,650
Cheniere Partners — 3.250% to 5.625% senior notes due between October 2025 and January 2032 and credit facilities (“2019 CQP Credit Facilities”)
4,200 4,100
CCH — 2.742% to 7.000% senior secured notes due between June 2024 and December 2039 and CCH Credit Facility
10,128 10,217
Cheniere — 4.625% senior secured notes due October 2028 (the “2028 Cheniere Senior Notes”), convertible notes, revolving credit facility (“Cheniere Revolving Credit Facility”) and term loan facility (“Cheniere Term Loan Facility”)
2,625 3,145
Unamortized premium, discount and debt issuance costs, net of accumulated amortization (600) (641)
Total long-term debt, net of premium, discount and debt issuance costs 29,481 30,471
Current debt:
SPL — current portion of 6.25% senior secured notes due March 2022 (the “2022 SPL Senior Notes”) (1) (2)
522 —
Cheniere Partners — current portion of 5.625% senior notes due October 2026 (the “2026 CQP Senior Notes”) (3)
428 —
CCH — $1.2 billion CCH working capital facility (“CCH Working Capital Facility”) and current portion of CCH Credit Facility
104 271
Cheniere Marketing — trade finance facilities and letter of credit facility
— —
Cheniere — current portion of the 4.875% convertible unsecured notes due May 2021 (“2021 Cheniere Convertible Notes”)
— 104
Unamortized discount and debt issuance costs, net of accumulated amortization (7) (3)
Total current debt, net of discount and debt issuance costs 1,047 372
Total debt, net of premium, discount and debt issuance costs $ 30,528 $ 30,843



	September 30,		December 31,
	2022		2021
SPL:
Senior Secured Notes:

5.625% due 2023 (the “2023 SPL Senior Notes”) (1)	$	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
Working capital revolving credit and letter of credit reimbursement agreement (the “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
Credit facilities (the “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 (2)	1,500		1,500
3.700% due 2029 (2)	1,492		1,500
3.72% weighted average rate due 2039 (2)	2,699		2,721
Total CCH Senior Secured Notes	8,441		8,471
CCH Credit Facility	—		1,728
Working capital facility (the “CCH Working Capital Facility”) (3)	—		250
Total debt - CCH	8,441		10,449

Cheniere:
4.625% Senior Secured Notes due 2028	1,500		2,000

2045 Cheniere Convertible Senior Notes (4)	—		625
Revolving credit facility (the “Cheniere Revolving Credit Facility”)	—		—

Total debt - Cheniere	1,500		2,625

Cheniere Marketing: trade finance facilities and letter of credit facility (3)	—		—
Total debt	27,273		30,406

Current portion of long-term debt	(219)		(117)
Short-term debt	(1,498)		(250)
Unamortized premium, discount and debt issuance costs, net	(231)		(590)
Total long-term debt, net of premium, discount and debt issuance costs	$	25,325	$	29,449

(1)~~A portion~~In October 2022, $300 million of the ~~2022~~2023 SPL Senior Notes ~~is categorized as long-term debt because~~were redeemed. As of September 30, 2022, the ~~proceeds from the expected series of sales of approximately $482 million aggregate principal~~entire amount of ~~senior secured notes due 2037 pursuant to executed note purchase agreements, expected to be issued in~~ the ~~fourth quarter of 2021, subject to customary closing conditions, will be used to strategically refinance a portion of the 2022 SPL Senior Notes and pay related fees, costs and expenses.~~

~~(2)In October 2021, $318 million of the 2022~~2023 SPL Senior Notes was ~~redeemed~~classified as short-term debt.

(2)Subsequent to September 30, 2022 and through October 31, 2022, we executed bond repurchases totaling $221 million, inclusive of CCH’s Senior Secured Notes due 2027, 2029 and 2039 on the open market, which are classified as current portion of long-term debt as of September 30, 2022 net of discount and debt issuance costs of $2 million.

(3)These debt instruments are classified as short-term debt.

(4)The redemption of these notes was financed with ~~$100 million from~~borrowings under the ~~proceeds from~~ Cheniere ~~Partners’ issuance~~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 ~~the 3.250% senior notes due 2032 (the “2032 CQP Senior Notes”) and $218 million of cash on hand.~~December 31, 2021. See ~~Issuances, Redemptions and Repayments~~ Convertible Notessection below for further ~~discussion.~~

~~(3)In October 2021, Cheniere Partners redeemed the remaining outstanding aggregate principal amount~~discussion of the ~~2026 CQP Senior Notes that were not purchased pursuant to the tender offer and consent solicitation in September 2021. See~~ ~~Issuances, Redemptions and Repayments~~ ~~section below for further discussion.~~

redemption.

~~CHENIERE ENERGY, INC. AND SUBSIDIARIES~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED~~

~~(unaudited)~~

~~Issuances, Redemptions and Repayments~~

~~The following table shows the issuances, redemptions and repayments of long-term debt during the nine months ended September 30, 2021, excluding intra-quarter borrowings and repayments (in millions):~~


~~Issuances~~	~~Principal Amount Issued~~
~~Three Months Ended March 31, 2021~~
~~Cheniere Partners~~ ~~— 4.000% Senior Notes due 2031 (the “2031 CQP Senior Notes”) (1)~~	$	~~1,500~~

~~Three Months Ended June 30, 2021~~
~~Cheniere~~ ~~— Cheniere Term Loan Facility (2)~~	~~220~~
~~Cheniere~~ ~~— Cheniere Revolving Credit Facility~~	~~134~~

~~Three Months Ended September 30, 2021~~
~~CCH~~ ~~— 2.742% Senior Notes due 2039 (the “2.742% CCH Senior Secured Notes”) (3)~~	~~750~~


~~Cheniere Partners~~ ~~— 2032 CQP Senior Notes (4)~~	~~1,200~~
~~Nine Months Ended September 30, 2021 total~~	$	~~3,804~~

~~Redemptions and Repayments~~	~~Principal Amount Redeemed/Repaid~~
~~Three Months Ended March 31, 2021~~
~~Cheniere Partners~~ ~~— 5.250% Senior Notes due 2025 (the “2025 CQP Senior Notes”) (1)~~	$	~~1,500~~
~~Cheniere~~ ~~— Cheniere Term Loan Facility (5)~~	~~148~~

~~Three Months Ended June 30, 2021~~
~~Cheniere~~ ~~— 2021 Cheniere Convertible Notes (2)~~	~~476~~
~~Cheniere~~ ~~— Cheniere Term Loan Facility (2)~~	~~220~~

~~Three Months Ended September 30, 2021~~
~~Cheniere~~ ~~— Cheniere Revolving Credit Facility~~	~~134~~
~~CCH~~ ~~— CCH Credit Facility (3)~~	~~866~~
~~Cheniere Partners~~ ~~— 2026 CQP Senior Notes (4)~~	~~672~~
~~Nine Months Ended September 30, 2021 total~~	$	~~4,016~~

~~(1)~~Net proceeds from the issuance of the 2031 CQP Senior Notes, together with cash on hand, were used to redeem all of Cheniere Partners’ outstanding 2025 CQP Senior Notes, resulting in $54 million of loss on extinguishment of debt relating to the payment of early redemption fees and write off of unamortized debt premium and issuance costs.

~~(2)The 2021 Cheniere Convertible Notes were repaid using a combination of borrowings under the Cheniere Term Loan Facility and cash on hand upon the maturity date at par value.~~

~~(3)~~Net proceeds of the 2.742% CCH Senior Secured Notes, together with cash on hand, were used to prepay a portion of the principal amount outstanding under the CCH Credit Facility, resulting in $9 million of loss on extinguishment of debt relating to the payment of early redemption fees and write off of unamortized issuance costs.

~~(4)~~Net proceeds from the issuance of the 2032 CQP Senior Notes were used to redeem a portion of the 2026 CQP Senior Notes in September 2021 pursuant to a tender offer and consent solicitation, resulting in $27 million of loss on extinguishment of debt relating to the payment of early redemption fees and write off of unamortized debt premium and issuance costs. In October 2021, the remaining net proceeds from the issuance of the 2032 CQP Senior Notes were used to redeem the remaining outstanding principal amount of the 2026 CQP Senior Notes and, together with cash on hand, redeem $318 million of the 2022 SPL Senior Notes.

~~(5)~~The remaining commitments under the Cheniere Term Loan Facility were terminated in accordance with the credit agreement, resulting in $4 million of loss on extinguishment of debt relating to the write off of unamortized issuance costs.

Table of Contents

CHENIERE ENERGY, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

(unaudited)

Credit Facilities

Below is a summary of our committed credit facilities outstanding as of September 30, ~~2021~~2022 (in millions):


		2020 SPL Working Capital Facility (1)		2019 CQP Credit Facilities		CCH Credit Facility		CCH Working Capital Facility		Cheniere Revolving Credit Facility			SPL Working Capital Facility		CQP Credit Facilities		CCH Credit Facility (1)		CCH Working Capital Facility (1)		Cheniere Revolving Credit Facility
Original facility size		$	1,200	$	1,500	$	8,404	$	350	$	750
Incremental commitments		—		—		1,566		850		500
Total facility size												Total facility size	$	1,200	$	750	$	3,260	$	1,500	$	1,250

Less:	Less:											Less:
Outstanding balance	Outstanding balance	—		—		1,761		—		—		Outstanding balance	—		—		—		—		—
Commitments prepaid or terminated		—		750		8,209		—		—

Letters of credit issued	Letters of credit issued	396		—		—		360		—		Letters of credit issued	363		—		—		218		—
Available commitment	Available commitment	$	804	$	750	$	—	$	840	$	1,250	Available commitment	$	837	$	750	$	3,260	$	1,282	$	1,250

Priority ranking	Priority ranking	Senior secured		Senior secured		Senior secured		Senior secured		Senior secured		Priority ranking	Senior secured		Senior secured		Senior secured		Senior secured		Senior secured
Interest rate on available balance	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%		LIBOR plus 1.25% - 1.75% or base rate plus 0.25% - 0.75%		LIBOR plus 1.75% - 2.50% or base rate plus 0.75% - 1.50%		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%		SOFR plus credit spread adjustment of 0.1% , plus margin of 1.5% or base rate plus 0.5%		SOFR plus credit spread adjustment of 0.1%, plus margin of 1.0% - 1.5% or base rate plus applicable margin		LIBOR plus 1.250% - 2.375% or base rate plus 0.250% - 1.375% (2)
Weighted average interest rate of outstanding balance		n/a		n/a		1.83%		n/a		n/a

Commitment fees on undrawn balance												Commitment fees on undrawn balance	0.15%		0.49%		0.53%		0.18%		0.25%
Maturity date	Maturity date	March 19, 2025		May 29, 2024		June 30, 2024		June 29, 2023		December 13, 2022		Maturity date	March 19, 2025		May 29, 2024		(3)		June 15, 2027		October 28, 2026

(1)~~The 2020 SPL~~In June 2022, CCH amended and restated the CCH Credit Facility and the CCH Working Capital Facility ~~contains customary~~resulting in $20 million of debt extinguishment and modification costs to, among other things, (1) provide incremental commitments of $3.7 billion and $300 million for the CCH Credit Facility and the CCH Working Capital Facility, respectively, in connection with the FID with respect to the Corpus Christi Stage 3 Project, (2) extend the maturity, (3) update the indexed interest rate to SOFR and (4) make certain other changes to the terms and conditions ~~precedent~~of each existing facility.

(2)This facility was amended in 2021 to establish a SOFR-indexed replacement rate for ~~extensions~~LIBOR.

(3)The CCH Credit Facility matures the earlier of ~~credit, as well as customary affirmative and negative covenants. SPL pays a commitment fee equal to an annual rate of 0.1% to 0.3% (depending on~~June 15, 2029 or two years after the ~~then-current rating of SPL), which accrues on the daily amount~~substantial completion of the ~~total commitment less~~last Train of the ~~sum of (1) the outstanding principal amount of loans, (2) letters of credit issued and (3) the outstanding principal amount of swing line loans.~~Corpus Christi Stage 3 Project.

Convertible Notes

~~Below is~~On December 6, 2021, we issued a ~~summary~~notice of ~~our convertible notes outstanding as of September 30, 2021 (in millions):~~

~~2045 Cheniere Convertible Senior Notes~~

~~Aggregate original principal~~

~~625~~

~~Debt component, net of discount and debt issuance costs~~

~~320~~

~~Equity component~~

~~194~~

~~Interest payment method~~

~~Cash~~

~~Conversion by us (1)~~

~~(2)~~

~~Conversion by holders (1)~~

~~(3)~~

~~Conversion basis~~

~~Cash and/or stock~~

~~Conversion value in excess of principal~~

—

~~Maturity date~~

~~March 15, 2045~~

~~Contractual interest rate~~

~~4.25~~

~~Effective interest rate (4)~~

~~9.4~~

~~Remaining debt discount and debt issuance costs amortization period (5)~~

~~23.5 years~~

~~(1)Conversion is subject to various limitations and conditions, which have not been met as of the balance sheet date.~~

~~(2)Redeemable at any time at a~~ redemption ~~price payable in cash equal to the accreted amount of the~~for all $625 million aggregate principal amount outstanding of the 2045 Cheniere Convertible Senior ~~Notes~~Notes. The notice of redemption allowed holders to ~~be redeemed, plus accrued and unpaid interest, if any,~~elect to ~~such redemption date.~~

~~(3)Prior to December 15, 2044, convertible only under certain circumstances as specified in the indenture; thereafter, holders may~~ convert their notes ~~regardless~~at any time prior to a specified deadline on December 31, 2021, with settlement of ~~these circumstances.~~such converted notes in cash, as elected by us, on January 5, 2022. The impact of holders electing conversion ~~rate will initially equal 7.2265 shares of our common stock per $1,000 principal amount of~~was immaterial to the Consolidated Financial Statements. The 2045 Cheniere Convertible Senior Notes

~~CHENIERE ENERGY, INC. AND SUBSIDIARIES~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED~~

~~(unaudited)~~

~~which corresponds to an initial conversion price~~ not converted were redeemed on January 5, 2022 with borrowings under the Cheniere Revolving Credit Facility. We recognized $16 million of ~~approximately $138.38 per share of our common stock (subject to adjustment upon the occurrence of certain specified events).~~

~~(4)Rate to accrete the discounted carrying value of the convertible notes~~debt extinguishment costs related to the ~~face value over the remaining amortization period.~~

~~(5)We amortize any debt discount and debt issuance costs using the effective interest over the period through contractual maturity.~~early redemption of these convertible notes.

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 September 30, ~~2021,~~2022, each of our issuers was in compliance with all covenants related to their respective debt agreements.

Table of Contents

CHENIERE ENERGY, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

(unaudited)

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 September 30,				Nine Months Ended September 30,				Three Months Ended September 30,				Nine Months Ended September 30,
		2021		2020		2021		2020				2022		2021		2022		2021
Interest cost on convertible notes:	Interest cost on convertible notes:										Interest cost on convertible notes:
Interest per contractual rate	Interest per contractual rate	$	6	$	20	$	29	$	140		Interest per contractual rate	$	—	$	6	$	—	$	29
Amortization of debt discount		1		7		9		41
Amortization of debt issuance costs		—		1		—		8
Amortization of debt discount and debt issuance costs											Amortization of debt discount and debt issuance costs	—		1		—		9

Total interest cost related to convertible notes	Total interest cost related to convertible notes	7		28		38		189			Total interest cost related to convertible notes	—		7		—		38
Interest cost on debt and finance leases excluding convertible notes	Interest cost on debt and finance leases excluding convertible notes	391		388		1,178		1,167			Interest cost on debt and finance leases excluding convertible notes	376		391		1,118		1,178
Total interest cost	Total interest cost	398		416		1,216		1,356			Total interest cost	376		398		1,118		1,216
Capitalized interest	Capitalized interest	(34)		(61)		(128)		(182)			Capitalized interest	(22)		(34)		(58)		(128)
Total interest expense, net of capitalized interest	Total interest expense, net of capitalized interest	$	364	$	355	$	1,088	$	1,174		Total interest expense, net of capitalized interest	$	354	$	364	$	1,060	$	1,088

Fair Value Disclosures

The following table shows the carrying amount and estimated fair value of our debt (in millions):


		September 30, 2021				December 31, 2020					September 30, 2022				December 31, 2021
		Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value			Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value
Senior notes — Level 2 (1)	Senior notes — Level 2 (1)	$	25,978	$	28,565	$	24,700	$	27,897	Senior notes — Level 2 (1)	$	24,020	$	22,461	$	24,550	$	26,725
Senior notes — Level 3 (2)	Senior notes — Level 3 (2)	2,771		3,317		2,771		3,423		Senior notes — Level 3 (2)	3,253		2,916		3,253		3,693
Credit facilities — Level 3 (3)		1,761		1,761		2,915		2,915
2021 Cheniere Convertible Notes — Level 3 (2)		—		—		476		480

2045 Cheniere Convertible Senior Notes — Level 1 ~~(4)~~(3)	2045 Cheniere Convertible Senior Notes — Level 1 ~~(4)~~(3)	625		538		625		496		2045 Cheniere Convertible Senior Notes — Level 1 ~~(4)~~(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.

~~CHENIERE ENERGY, INC. AND SUBSIDIARIES~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED~~

~~(unaudited)~~

(3)The Level 3 estimated fair value approximates the principal amount 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.

~~(4)~~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.

Table of Contents

CHENIERE ENERGY, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

(unaudited)

NOTE 10—LEASES

Our leased assets consist primarily of LNG vessel time charters (“vessel charters”) and additionally include tug vessels, office space and facilities and land sites. All of our leases are classified as operating leases except for certain of our tug vessels, ~~supporting the Corpus Christi LNG Terminal,~~ which are classified as finance leases.

The following table shows the classification and location of our right-of-use assets and lease liabilities on our Consolidated Balance Sheets (in millions):


			September 30,		December 31,				September 30,		December 31,
		Consolidated Balance Sheets Location	2021		2020			Consolidated Balance Sheets Location	2022		2021
Right-of-use assets—Operating	Right-of-use assets—Operating	Operating lease assets	$	2,064	$	759	Right-of-use assets—Operating	Operating lease assets	$	2,795	$	2,102
Right-of-use assets—Financing	Right-of-use assets—Financing	Property, plant and equipment, net of accumulated depreciation	51		53		Right-of-use assets—Financing	Property, plant and equipment, net of accumulated depreciation	70		50
Total right-of-use assets	Total right-of-use assets		$	2,115	$	812	Total right-of-use assets		$	2,865	$	2,152

Current operating lease liabilities	Current operating lease liabilities	Current operating lease liabilities	$	458	$	161	Current operating lease liabilities	Current operating lease liabilities	$	669	$	535
Current finance lease liabilities	Current finance lease liabilities	Other current liabilities	2		2		Current finance lease liabilities	Other current liabilities	6		2
Non-current operating lease liabilities	Non-current operating lease liabilities	Operating lease liabilities	1,590		597		Non-current operating lease liabilities	Operating lease liabilities	2,082		1,541
Non-current finance lease liabilities	Non-current finance lease liabilities	Finance lease liabilities	57		57		Non-current finance lease liabilities	Finance lease liabilities	75		57
Total lease liabilities	Total lease liabilities		$	2,107	$	817	Total lease liabilities		$	2,832	$	2,135

The following table shows the classification and location of our lease costs on our Consolidated Statements of Operations (in millions):


		Consolidated Statements of Operations Location		Three Months Ended September 30,								Nine Months Ended September 30,								Consolidated Statements of Operations Location			Three Months Ended September 30,						Nine Months Ended September 30,
			2021			2020				2021				2020							Consolidated Statements of Operations Location				2022			2021			2022			2021
Operating lease cost (a)	Operating lease cost (a)		Operating costs and expenses (1)			$	145			$	77			$	441			$	316					Operating lease cost (a)		$	213		$	145		$	604		$	441
Finance lease cost:	Finance lease cost:																						Finance lease cost:
Amortization of right-of-use assets	Amortization of right-of-use assets	Depreciation and amortization expense		—				—				2				2						Amortization of right-of-use assets	Depreciation and amortization expense			1			—			3			2
Interest on lease liabilities	Interest on lease liabilities	Interest expense, net of capitalized interest		2				2				7				7						Interest on lease liabilities	Interest expense, net of capitalized interest			2			2			7			7

Total lease cost	Total lease cost			$	147			$	79			$	450			$	325					Total lease cost				$	216		$	147		$	614		$	450

(a) Included in operating lease cost:	(a) Included in operating lease cost:																					(a) Included in operating lease cost:
Short-term lease costs	Short-term lease costs			$	22			$	9			$	103			$	60					Short-term lease costs				$	16		$	22		$	80		$	103
Variable lease costs	Variable lease costs			7				3				20				12						Variable lease costs				7			7			16			20

(1)Presented in cost of sales, operating and maintenance expense or selling, general and administrative expense consistent with the nature of the asset under lease.

2221

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CHENIERE ENERGY, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

(unaudited)

Future annual minimum lease payments for operating and finance leases as of September 30, ~~2021~~2022 are as follows (in millions):


Years Ending December 31,	Years Ending December 31,	Operating Leases (1)		Finance Leases		Years Ending December 31,	Operating Leases (1)		Finance Leases
2021		$	139	$	3
2022	2022	515		10		2022	$	193	$	4
2023	2023	479		10		2023	736		15
2024	2024	433		10		2024	651		15
2025	2025	243		10		2025	474		15
2026						2026	341		15
Thereafter	Thereafter	510		127		Thereafter	763		122
Total lease payments	Total lease payments	2,319		170		Total lease payments	3,158		186
Less: Interest	Less: Interest	(271)		(111)		Less: Interest	(407)		(105)
Present value of lease liabilities	Present value of lease liabilities	$	2,048	$	59	Present value of lease liabilities	$	2,751	$	81

(1)Does not include ~~$758 million~~approximately $2.9 billion of legally binding minimum ~~lease~~ payments primarily for vessel charters ~~which were executed~~contracted for as of September 30, ~~2021 but~~2022 which will commence in future periods ~~primarily in the next year and have~~with fixed minimum lease terms of up to ~~seven~~10 years.

The following table shows the weighted-average remaining lease term and the weighted-average discount rate for our operating leases and finance leases:


		September 30, 2021		December 31, 2020			September 30, 2022		December 31, 2021
		Operating Leases	Finance Leases	Operating Leases	Finance Leases		Operating Leases	Finance Leases	Operating Leases	Finance Leases
Weighted-average remaining lease term (in years)	Weighted-average remaining lease term (in years)	5.9	16.9	8.2	17.7	Weighted-average remaining lease term (in years)	6.1	13.2	5.6	16.7
Weighted-average discount rate (1)	Weighted-average discount rate (1)	3.6%	16.2%	5.4%	16.2%	Weighted-average discount rate (1)	4.0%	14.6%	3.6%	16.2%

(1)The weighted average discount rate is impacted by certain finance leases that commenced prior to the adoption of the current leasing standard under GAAP. In accordance with previous accounting guidance, the implied rate is based on the fair value of the underlying assets.

The following table includes other quantitative information for our operating and finance leases (in millions):


		Nine Months Ended September 30,				Nine Months Ended September 30,
		2021		2020				2022		2021
Cash paid for amounts included in the measurement of lease liabilities:	Cash paid for amounts included in the measurement of lease liabilities:						Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows used in operating leases		$	331	$	226
Operating cash flows used in finance leases		7		8
Operating cash flows from operating leases							Operating cash flows from operating leases	$	524	$	331
Operating cash flows from finance leases							Operating cash flows from finance leases	6		7

Right-of-use assets obtained in exchange for operating lease liabilities	Right-of-use assets obtained in exchange for operating lease liabilities	1,575		412			Right-of-use assets obtained in exchange for operating lease liabilities	1,139		1,575
Right-of-use assets obtained in exchange for finance lease liabilities							Right-of-use assets obtained in exchange for finance lease liabilities	23		—

LNG Vessel Subcharters

From time to time, we sublease certain LNG vessels under charter to third parties while retaining our existing obligation to the original lessor. As of ~~both~~ September 30, ~~2021~~2022 and December 31, ~~2020,~~2021, we had no$534 million and $15 million future minimum sublease payments to be received from LNG vessel subcharters. The following table shows the sublease income recognized in other revenues on our Consolidated Statements of Operations (in millions):


		Three Months Ended September 30,				Nine Months Ended September 30,				Three Months Ended September 30,				Nine Months Ended September 30,
		2021		2020		2021		2020				2022		2021		2022		2021
Fixed income	Fixed income	$	17	$	9	$	28	$	61		Fixed income	$	122	$	17	$	188	$	28
Variable income	Variable income	15		1		21		24			Variable income	12		15		37		21
Total sublease income	Total sublease income	$	32	$	10	$	49	$	85		Total sublease income	$	134	$	32	$	225	$	49

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

(unaudited)

NOTE 11—REVENUES ~~FROM CONTRACTS WITH CUSTOMERS~~

The following table represents a disaggregation of revenue earned ~~from contracts with customers during the three and nine months ended September 30, 2021 and 2020~~ (in millions):

Three Months Ended September 30, Nine Months Ended September 30,
2021 2020 2021 2020
LNG revenues (1) $ 4,169 $ 1,344 $ 10,505 $ 6,088
Regasification revenues 68 67 202 202
Other revenues 22 10 66 48
Total revenues from customers 4,259 1,421 10,773 6,338
Net derivative gain (loss) (2) (1,091) 29 (1,515) 148
Other (3) 32 10 49 85
Total revenues $ 3,200 $ 1,460 $ 9,307 $ 6,571


	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Revenues from contracts with customers
LNG revenues	$	8,422	$	4,170	$	23,774	$	10,505
Regasification revenues	455		68		591		202
Other revenues	27		22		78		66

Total revenues from contracts with customers	8,904		4,260		24,443		10,773
Net derivative loss (1)	(186)		(1,092)		(325)		(1,515)
Other (2)	134		32		225		49
Total revenues	$	8,852	$	3,200	$	24,343	$	9,307

(1)LNG revenues include revenues for LNG cargoes in which our customers exercised their contractual right to not take delivery but remained obligated to pay fixed fees irrespective of such election. During the three and nine months ended September 30, 2020, we recognized $171 million and $932 million, respectively, in LNG revenues associated with LNG cargoes for which customers notified us that they would not take delivery, of which $47 million would have been recognized subsequent to September 30, 2020 had the cargoes been lifted pursuant to the delivery schedules with the customers. LNG revenues during the three months ended September 30, 2021 and 2020 excluded zero and $458 million, respectively, and LNG revenues during the nine months ended September 30, 2021 and 2020 excluded $38 million and zero, respectively, that would have otherwise been recognized during the period if the cargoes were lifted pursuant to the delivery schedules with the customers. We did not have revenues associated with LNG cargoes for which customers notified us that they would not take delivery during the three and nine months ended September 30, 2021. Revenue is generally recognized upon receipt of irrevocable notice that a customer will not take delivery because our customers have no contractual right to take delivery of such LNG cargo in future periods and our performance obligations with respect to such LNG cargo have been satisfied.

~~(2)~~See Note 6—Derivative Instruments for additional information about our derivatives.

~~(3)~~(2)Includes revenues from LNG vessel subcharters. See Note 1 0 —10—Leases for additional information about our subleases.

Contract Assets and Liabilities

The following table shows our contract assets, net of current expected credit losses, which are classified as ~~other current~~contract assets and other non-current assets, net on our Consolidated Balance Sheets (in millions):

September 30, December 31,
2021 2020
Contract assets, net of current expected credit losses $ 123 $ 80

Contract assets represent our right to consideration for transferring goods or services to the customer under the terms of a sales contract when the associated consideration is not yet due. Changes in contract assets during the nine months ended September 30, 2021 were primarily attributable to revenue recognized due to the delivery of LNG under certain SPAs for which the associated consideration was not yet due.



	September 30,		December 31,
	2022		2021
Contract assets, net of current expected credit losses	$	553	$	140

The following table reflects the changes in our contract liabilities, which we classify as deferred revenue and other non-current liabilities on our Consolidated Balance Sheets (in millions):

Nine Months Ended September 30, ~~2021~~2022

Deferred revenue, beginning of period

~~138~~194

Cash received but not yet recognized in revenue

~~196~~284

Revenue recognized from prior ~~period~~year end deferral

~~(138)~~(194)

Deferred revenue, end of period

~~196~~284

~~CHENIERE ENERGY, INC. AND SUBSIDIARIES~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED~~

~~(unaudited)~~

Transaction Price Allocated to Future Performance Obligations

Because many of our sales contracts have long-term durations, we are contractually entitled to significant future consideration which we have not yet recognized as revenue. The following table discloses the aggregate amount of the transaction price that is allocated to performance obligations that have not yet been ~~satisfied as of September 30, 2021 and December 31, 2020:~~satisfied:


		September 30, 2021			December 31, 2020				September 30, 2022			December 31, 2021
		Unsatisfied Transaction Price (in billions)		Weighted Average Recognition Timing (years) (1)	Unsatisfied Transaction Price (in billions)		Weighted Average Recognition Timing (years) (1)		Unsatisfied Transaction Price (in billions)		Weighted Average Recognition Timing (years) (1)	Unsatisfied Transaction Price (in billions)		Weighted Average Recognition Timing (years) (1)
LNG revenues	LNG revenues	$	100.6	10	$	102.3	10	LNG revenues	$	113.5	9	$	107.1	9
Regasification revenues	Regasification revenues	1.9		4	2.1		5	Regasification revenues	1.6		2	1.9		4
Total revenues	Total revenues	$	102.5		$	104.4		Total revenues	$	115.1		$	109.0

(1)The weighted average recognition timing represents an estimate of the number of years during which we shall have recognized half of the unsatisfied transaction price.

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CHENIERE ENERGY, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

(unaudited)

We have elected the following exemptions which omit certain potential future sources of revenue from the table above:

(1)We omit from the table above all performance obligations that are part of a contract that has an original expected duration of one year or less.

(2)The table above excludes substantially all variable consideration under our SPAs and TUAs. We omit from the table above all variable consideration that is allocated entirely to a wholly unsatisfied performance obligation or to a wholly unsatisfied promise to transfer a distinct good or service that forms part of a single performance obligation when that performance obligation qualifies as a series. The amount of revenue from variable fees that is not included in the transaction price will vary based on the future prices of Henry Hub throughout the contract terms, to the extent customers elect to take delivery of their LNG, and adjustments to the consumer price index. Certain of our contracts contain additional variable consideration based on the outcome of contingent events and the movement of various indexes. We have not included such variable consideration in the transaction price to the extent the consideration is considered constrained due to the uncertainty of ultimate pricing and receipt. Additionally, we have excluded variable consideration related to contracts where there is uncertainty that one or both of the parties will achieve certain milestones. Approximately ~~61%~~76% and ~~37%~~61% of our LNG revenues from contracts included in the table above during the three months ended September 30, ~~2021~~2022 and ~~2020,~~2021, respectively, and approximately ~~56%~~72% and ~~35%~~56% of our LNG revenues from contracts included in the table above during the nine months ended September 30, ~~2021~~2022 and ~~2020,~~2021, respectively, were related to variable consideration received from customers. During ~~each of~~ the three and nine months ended September 30, ~~2021,~~2022, approximately 5%1% and 2%, respectively, of our regasification revenues were related to variable consideration received from customers and during each of the three and nine months ended September 30, ~~2020,~~2021, approximately 6%5% of our regasification revenues were related to variable consideration received from customers.

We may enter into contracts to sell LNG that are conditioned upon one or both of the parties achieving certain milestones such as reaching FID on a certain liquefaction Train, obtaining financing or achieving substantial completion of a Train and any related facilities. These contracts are considered completed contracts for revenue recognition purposes and are included in the transaction price above when the conditions are considered probable of being met.

Termination Agreement with Chevron

In June 2022, Chevron U.S.A. Inc. (“Chevron”) entered into an agreement with SPLNG providing for the early termination of the TUA and an associated terminal marine services agreement between the parties and their affiliates for a lump sum fee of $765 million (the “Termination Fee”). Obligations pursuant to the TUA and associated agreement, including Chevron’s obligation to pay SPLNG capacity payments totaling $125 million annually (adjusted for inflation) from 2023 through 2029, will terminate upon the later of SPLNG’s receipt of the Termination Fee or December 31, 2022. The termination agreement became effective on July 6, 2022. We have allocated the $765 million Termination Fee to the terminated commitments, with $796 million in cash inflows allocable to the termination of the TUA, which we are recognizing ratably over the July 6, 2022 to December 31, 2022 period as regasification revenues on our Consolidated Statements of Operations, and an offsetting $31 million in cash outflows allocable to the extinguishment of other remaining obligations we have to Chevron, which will be recognized upon receipt of the Termination Fee as a loss on extinguishment of debt on our Consolidated Statements of Operations. As of September 30, 2022, we recorded contract assets of $387 million related to the termination of the TUA.

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CHENIERE ENERGY, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

(unaudited)

NOTE 12—RELATED PARTY TRANSACTIONS

~~Natural Gas Supply Agreements~~Below is a summary of our related party transactions as reported on our Consolidated Statements of Operations (in millions):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
LNG Revenues
Natural Gas Transportation and Storage Agreements	$	—	$	—	$	4	$	—

Other revenues
Operation and Maintenance Services Agreements	3		2		5		5

Cost of sales
Natural Gas Supply Agreements (a) (1)	—		53		—		124
Natural Gas Transportation and Storage Agreements	—		—		1		1

Total cost of sales	—		53		1		125

Operating and maintenance expense
Natural Gas Transportation and Storage Agreements	18		14		45		41



(a) Included in cost of sales:
Liquefaction Supply Derivative gain (1)	—		6		—		13

(1)

~~SPL and CCL are party~~Includes amounts recorded related to natural gas supply ~~agreements~~contracts that SPL and CCL had with related ~~parties~~parties. These agreements ceased to be considered related party agreements during 2021, as discussed below.

Natural Gas Supply Agreement

CCL Natural Gas Supply Agreement

CCL was party to a natural gas supply agreement with a related party in the ordinary course of business to obtain a fixed minimum daily volume of feed gas for the operation of the ~~Liquefaction Projects. These~~CCL Project. The related ~~parties are partially owned~~party entity was acquired by ~~The Blackstone Group Inc., who also partially owns Cheniere Partners’ limited partner interests.~~

~~SPL Natural Gas Supply Agreement~~

~~The term of the SPL agreement is for five years, which can commence no earlier than~~a non-related party on November 1, 2021, ~~and no later than November 1, 2022, following the achievement~~therefore, as of ~~contractually-defined conditions precedent. As of September 30, 2021~~

~~CHENIERE ENERGY, INC. AND SUBSIDIARIES~~

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED~~

~~(unaudited)~~

~~and December 31, 2020, the notional amount for~~such date, this agreement ~~was 99 TBtu and 91 TBtu, respectively. As of both September 30, 2021 and December 31, 2020, the agreement had~~ceased to be considered 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 $19 million and $13 million in accrued liabilities, as of September 30, 2021 and December 31, 2020, respectively.

~~The Liquefaction Supply Derivatives~~ related ~~to this agreement are recorded on our Consolidated Balance Sheets as follows (in millions, except notional amount):~~

September 30, December 31,
2021 2020
Current derivative assets $ 7 $ 3
Derivative assets 10 1
Notional amount (in TBtu) 119 60

~~We recorded the following amounts on our Consolidated Statements of Operations during the three and nine months ended September 30, 2021 and 2020 related to this agreement (in millions):~~

Three Months Ended September 30, Nine Months Ended September 30,
2021 2020 2021 2020
Cost of sales (a) $ 53 $ 29 $ 124 $ 77
(a) Included in costs of sales:
Liquefaction Supply Derivative gain $ 6 $ (5) $ 13 $ (3)
party agreement.

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. This related party is partially owned by Brookfield Asset Management, Inc., who indirectly acquired a portion of ~~Cheniere Partners’~~CQP’s limited partner interests in September 2020. We recorded ~~operating and maintenance expense of $12 million and $34 million and cost of sales of zero and $1 million during the three and nine months ended September 30, 2021, respectively, and~~ accrued liabilities of $5$8 million and $4 million as of September 30, ~~2021~~2022 and December 31, ~~2020,~~2021, respectively, with this related party.

CCL is party to natural gas transportation agreements with Midship Pipeline Company, LLC (“Midship Pipeline”) in the ordinary course of business for the operation of the CCL Project, for a period of 10 years which began in May 2020. We recorded accrued liabilities of $1 million as of both September 30, 2022 and December 31, 2021 with this related party. We account for our investment in Midship Holdings, LLC (“Midship Holdings”), which manages the business and affairs of Midship Pipeline, as an equity method investment. ~~We recorded operating and maintenance expense of $2 million during both~~During the three months ended September 30, ~~2021~~2022, we recognized other-than-temporary impairment losses of $67 million related to our investment in Midship Holdings primarily related to increased forecast construction-related and ~~2020 and $7 million and $4 million during the nine months ended September 30, 2021 and 2020, respectively. Additionally, we recorded accrued liabilities~~operating costs, which are presented in other income (expense), net. Our investment in Midship Holdings, net of $1impairment losses, was $11 million as of ~~both~~ September 30, ~~2021~~2022, which was measured using an income approach that utilized level 3 fair value inputs such as projected earnings and ~~December 31, 2020 with this related party.~~discount rates.

CCL is party to a natural gas transportation agreement with ADCC Pipeline, LLC and its wholly owned subsidiary (collectively, “ADCC Pipeline”) in the ordinary course of business for the operation of the CCL Project, with an initial term of 20 years with extension rights. We have a 30% equity interest in ADCC Pipeline, as further described below.

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CHENIERE ENERGY, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

(unaudited)

Operation and Maintenance Service Agreements

Cheniere 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 in each of the three months ended September 30, 2021 and 2020 and $5 million and $8 million in the nine months ended September 30, 2021 and 2020, respectively, of other revenues and~~ $1 million and $2 million of ~~accounts receivable~~other receivables as of September 30, ~~2021~~2022 and December 31, ~~2020,~~2021, respectively, for services provided to Midship Pipeline under these agreements.

Share Purchase Agreement

~~CHENIERE ENERGY, INC. AND SUBSIDIARIES~~In June 2022, we entered into a purchase agreement to purchase approximately $350 million of Cheniere’s common shares beneficially owned by Icahn Capital LP and certain affiliates of Icahn Capital LP (the “Icahn Group”) pursuant to which we purchased an aggregate of approximately 2.68 million shares of our common stock at a price per share of $130.52, the closing price on our common shares on the date of execution of the purchase agreement. Pursuant to the Nomination and Standstill Agreement entered into on August 21, 2015 by Cheniere and the Icahn Group, the Icahn Group’s remaining director designee to our Board, Andrew Teno, resigned from our Board and all committees of our Board effective June 21, 2022. Additionally, as of such date, the Icahn Group ceased to be considered a related party.

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED~~

~~(unaudited)~~

Interest in ADCC Pipeline, LLC

In June 2022, Cheniere, through its wholly owned subsidiary Cheniere ADCC Investments, LLC, acquired a 30% equity interest in ADCC Pipeline. ADCC Pipeline will develop, construct and operate an approximately 42-mile natural gas pipeline project connecting the Agua Dulce natural gas hub to the CCL Project. We currently have a future commitment of up to approximately $93 million to fund our equity interest, which commitment is subject to a condition precedent that has not yet been satisfied.

NOTE 13—INCOME TAXES

We recorded an income tax benefit of $752 million and $762 million during the three and nine months ended September 30, 2022, respectively, and an income tax benefit of $1,860 million and $1,864 million during the three and nine months ended September 30, 2021, ~~respectively,~~respectively.

We have historically calculated our provision for income taxes during interim reporting periods by applying an estimate of the annual effective tax rate to year-to-date ordinary income or loss (“annual effective tax rate method”). Because of significant sensitivities in the annual effective tax rate as a result of variability in our earnings due to pre-tax derivative losses arising from changes in fair value from our IPM agreements and anthe portion of our earnings attributable to non-controlling interest, a relatively small change in estimated ordinary income or loss would result in significant changes in the estimated annual effective tax ~~benefit~~rate such that we are unable to make a reliable estimate of ~~$75 million and income~~the annual effective tax ~~provision of $119 million during~~rate for the three and nine months ended September 30, ~~2020, respectively.~~2022. Accordingly, we have applied a discrete-period method to calculate income taxes for the three and nine months ended September 30, 2022 based on the year-to-date effective tax rate (“year-to-date effective tax rate method”). The year-to-date effective tax rate method treats the year-to-date period as if it was the annual period and determines the income tax expense or benefit on that basis.

Utilizing the year-to-date effective tax rate method, our effective tax rate for the three and nine months ended September 30, 2022 was 22.1% and 23.3%, respectively. The effective tax ~~rates~~rate for the three and nine months ended September 30, 2022 represents a tax benefit on pre-tax loss and was higher than the statutory rate primarily due to our projected foreign derived intangible income (“FDII”) deduction, which results in income from our sales to foreign customers being taxed at a lower effective tax rate.

We used the annual effective tax rate method to calculate our income tax benefit for the three and nine months ended September 30, 2021, ~~were~~which was 67.0% and 79.7%, ~~respectively. Our~~respectively, as it was determined that the annual effective tax rate ~~is based on income (loss) before income taxes and non-controlling interest and is significantly impacted by non-controlling interest that is not taxable to Cheniere. Our~~method would produce a reliable estimate. The effective tax rate ~~experienced volatility during~~for the three and nine months ended September 30, 2021 did not bear a customary relationship to the statutory income tax rate due to variability in our earnings due to pre-tax derivative losses arising from changes in fair value from our IPM agreements and the ~~proportion~~portion of ~~such~~our earnings attributable to non-controlling interest. The variability in earnings in the three and nine months ended September 30, 2021 were mainly the result of approximately $3.5 billion and $4.2 billion, respectively, of pre-tax derivative losses, primarily on our commodity derivatives as a result of unfavorable shifts in international forward commodity curves.

The effective tax rates for the three and nine months ended September 30, 2020 were 12.9% and 19.3%, respectively, which were lower than the 21% federal statutory tax rate primarily due to income allocated to non-controlling interest that is not taxable to Cheniere, and in the nine months ended September 30, 2020, it was partially offset by a $38 million discrete tax expense related to an internal restructuring.

~~NOTE 14—SHARE-BASED COMPENSATION~~

We have granted restricted stock shares, restricted stock units, performance stock units and phantom units to employees and non-employee directors under the 2011 Incentive Plan, as amended (the “2011 Plan”) and the 2020 Incentive Plan (the “2020 Plan”). For the nine months ended September 30, 2021, we granted 1.6 million restricted stock units and 0.3 million performance stock units at target performance under the 2020 Plan to certain employees. Additionally, 0.2 million incremental shares of our common stock were issued based on performance results from previously-granted performance stock unit awards.

Restricted stock units are stock awards that vest over a service period of three years and entitle the holder to receive shares of our common stock upon vesting, subject to restrictions on transfer and to a risk of forfeiture if the recipient terminates employment with us prior to the lapse of the restrictions. Performance stock units provide for cliff vesting after a period of three years with payouts based on metrics dependent upon market and performance achieved over the defined performance period compared to pre-established performance targets. The settlement amounts of the awards are based on market and performance metrics which include cumulative distributable cash flow per share, and in certain circumstances, absolute total shareholder return (“ATSR”) of our common stock. Where applicable, the compensation for performance stock units is based on fair value assigned to the market metric of ATSR using a Monte Carlo model upon grant, which remains constant through the vesting period, and a performance metric, which will vary due to changing estimates regarding the expected achievement of the performance metric of cumulative distributable cash flow per share. The number of shares that may be earned at the end of the vesting period ranges from 0% up to 300% of the target award amount. Both restricted stock units and performance stock units will be settled in Cheniere common stock (on a one-for-one basis) and are classified as equity awards, however, a portion of the performance stock units granted in 2021 will partially settle in cash, subject to individual limits. The portion of performance stock units expected to settle in Cheniere common stock (on a one-for-one basis) are classified as equity awards and the portion of performance stock units expected to settle in cash are classified as liability awards.

~~Total share-based compensation consisted of the following (in millions):~~

Three Months Ended September 30, Nine Months Ended September 30,
2021 2020 2021 2020
Share-based compensation costs, pre-tax:
Equity awards $ 28 $ 26 $ 92 $ 86
Liability awards 1 1 3 2
Total share-based compensation 29 27 95 88
Capitalized share-based compensation (1) — (4) (4)
Total share-based compensation expense $ 28 $ 27 $ 91 $ 84
Tax benefit associated with share-based compensation expense $ 3 $ 2 $ 30 $ 21

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

(unaudited)

NOTE ~~15—~~14—NET ~~INCOME (LOSS)~~LOSS PER SHARE ATTRIBUTABLE TO COMMON STOCKHOLDERS

Basic net income (loss) per share attributable to common stockholders (“EPS”) excludes dilution and is computed by dividing net income (loss) attributable to common stockholders by the weighted average number of common shares outstanding during the period. Diluted EPS reflects potential dilution and is computed by dividing net income (loss) attributable to common stockholders by the weighted average number of common shares outstanding during the period increased by the number of additional common shares that would have been outstanding if the potential common shares had been issued. The dilutive effect of unvested stock is calculated using the treasury-stock method and the dilutive effect of convertible securities is calculated using the if-converted method.

The following table reconciles basic and diluted weighted average common shares outstanding ~~for the three~~ and ~~nine months ended September 30, 2021 and 2020~~common stock dividends declared (in millions, except per share data):


		Three Months Ended September 30,				Nine Months Ended September 30,				Three Months Ended September 30,				Nine Months Ended September 30,
		2021		2020		2021		2020				2022		2021		2022		2021
Net income (loss) attributable to common stockholders		$	(1,084)	$	(463)	$	(1,020)	$	109
Net loss attributable to common stockholders											Net loss attributable to common stockholders	$	(2,385)	$	(1,084)	$	(2,509)	$	(1,020)

Weighted average common shares outstanding:	Weighted average common shares outstanding:										Weighted average common shares outstanding:
Basic	Basic	253.6		252.2		253.3		252.5			Basic	249.9		253.6		252.5		253.3
Dilutive unvested stock	Dilutive unvested stock	—		—		—		0.7			Dilutive unvested stock	—		—		—		—

Diluted	Diluted	253.6		252.2		253.3		253.2			Diluted	249.9		253.6		252.5		253.3

Net income (loss) per share attributable to common stockholders—basic and diluted		$	(4.27)	$	(1.84)	$	(4.03)	$	0.43
Net loss per share attributable to common stockholders—basic and diluted											Net loss per share attributable to common stockholders—basic and diluted	$	(9.54)	$	(4.27)	$	(9.94)	$	(4.03)

Dividends paid per common share											Dividends paid per common share	$	0.33	$	—	$	0.99	$	—

On September 12, 2022, we declared a quarterly dividend of $0.395 per share of common stock that is payable on November 16, 2022 to shareholders of record as of November 8, 2022.

Potentially dilutive securities that were not included in the diluted net ~~income (loss)~~loss per share computations because their effects would have been anti-dilutive were as follows (in millions):


		Three Months Ended September 30,		Nine Months Ended September 30,		Three Months Ended September 30,			Nine Months Ended September 30,
		2021	2020	2021	2020			2022	2021	2022	2021
Unvested stock (1)	Unvested stock (1)	1.8	3.1	1.6	2.4		Unvested stock (1)	2.5	1.8	2.3	1.6

2045 Cheniere Convertible Senior Notes(2)	2045 Cheniere Convertible Senior Notes(2)	4.5	4.5	4.5	4.5		2045 Cheniere Convertible Senior Notes(2)	—	4.5	0.2	4.5
Total potentially dilutive common shares	Total potentially dilutive common shares	6.3	7.6	6.1	6.9		Total potentially dilutive common shares	2.5	6.3	2.5	6.1

(1)Includes the impact of unvested shares containing performance conditions to the extent that the underlying performance conditions are satisfied based on actual results as of the respective dates.

(2)As described in Note 9—Debt, the 2045 Cheniere Convertible Senior Notes were redeemed or converted in cash on January 5, 2022. However, the adoption of ASU 2020-06 on January 1, 2022 required a presumption of share settlement for the purpose of calculating the impact to diluted earnings per share during the period the notes were outstanding in 2022. Such impact was anti-dilutive as a result of the reported net loss attributable to common shareholders during the 2022 period. See Note 1—Nature of Operations and Basis of Presentation for further discussion of our adoption of ASU 2020-06.

NOTE ~~16—STOCKHOLDERS’ EQUITY~~15—STOCK REPURCHASE PROGRAMS

~~Share Repurchase Programs~~

~~On June 3, 2019, we announced that our Board of Directors (the “Board”) authorized a~~ ~~three-year, $1.0 billion share repurchase program.~~ On September 7, 2021, ~~the~~our Board authorized ~~an increase~~a reset in the previously existing share repurchase program to $1.0 billion, inclusive of any amounts remaining under the previous authorization as of September 30, 2021, for an additional three years beginning on October 1, 2021. On September 12, 2022, our Board authorized an increase in the existing share repurchase program by $4.0 billion for an additional three years, beginning on October 1, 2022. The following table presents information with respect to repurchases of common stock ~~during the three and nine months ended September 30, 2021 and 2020~~ (in millions, except per share data):


		Three Months Ended September 30,				Nine Months Ended September 30,				Three Months Ended September 30,				Nine Months Ended September 30,
		2021		2020		2021		2020				2022		2021		2022		2021
Aggregate common stock repurchased	Aggregate common stock repurchased	0.1		—		0.1		2.9			Aggregate common stock repurchased	0.60		0.08		4.97		0.08
Weighted average price paid per share	Weighted average price paid per share	$	83.97	$	—	$	83.97	$	53.88		Weighted average price paid per share	$	125.34	$	83.97	$	128.73	$	83.97
Total amount paid	Total amount paid	$	6	$	—	$	6	$	155		Total amount paid	$	75	$	6	$	640	$	6

As of September 30, ~~2021,~~2022, we had ~~up to $589~~$358 million ~~of the~~remaining under our share repurchase program, ~~available,~~ which increased to ~~$1.0~~approximately $4.4 billion as of October 1, ~~2021.~~2022.

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CHENIERE ENERGY, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

(unaudited)

~~Dividends~~

On September 7, 2021, we declared a quarterly dividend of $0.33 per share that is payable on November 17, 2021 to shareholders of record as of November 3, 2021. As of September 30, 2021, we had $85 million accrued related to this obligation, which is included in accrued liabilities and other non-current liabilities in our Consolidated Balance Sheets.

NOTE ~~17—~~16—CUSTOMER CONCENTRATION

The following table shows external customers with revenues of 10% or greater of total revenues from external customers and external customers with ~~accounts receivable,~~trade and other receivables, net of current expected credit losses and contract assets, net of current expected credit losses balances of 10% or greater of total ~~accounts receivable,~~trade and other receivables, net of current expected credit losses from external customers and contract assets, net of current expected credit losses from external customers, respectively:

Percentage of Total Revenues from External Customers

Percentage of Accounts Receivable, Net and Contract Assets, Net from External Customers

Percentage of Total Revenues from External Customers

Percentage of Trade and Other Receivables, Net and Contract Assets, Net from External Customers

Three Months Ended September 30,

Nine Months Ended September 30,

September 30,

December 31,

Three Months Ended September 30,

Nine Months Ended September 30,

September 30,

December 31,

2021

2020

2021

2020

2021

2020

2022

2021

2022

2021

2022

2021

Customer A

12%

14%

13%

14%

Customer A

12%

14%

10%

Customer B

15%

11%

13%

10%

12%

Customer B

15%

13%

Customer C

11%

15%

11%

Customer C

11%

Customer D

11%

13%

10%

Customer D

11%

Customer E

17%

Customer E

16%

—

Customer F

12%

* Less than 10%

NOTE ~~18—~~17—SUPPLEMENTAL CASH FLOW INFORMATION

The following table provides supplemental disclosure of cash flow information (in millions):

Nine Months Ended September 30,
2021 2020
Cash paid during the period for interest on debt, net of amounts capitalized $ 902 $ 977
Cash paid for income taxes, net of refunds 2 2
Non-cash investing and financing activities:
Property, plant and equipment, net of accumulated depreciation funded with accounts payable and accrued liabilities 234 262
Accrued and declared dividends on common stock 85 —


	Nine Months Ended September 30,
	2022		2021
Cash paid during the period for interest on debt, net of amounts capitalized	$	891	$	902
Cash paid for income taxes, net of refunds	28		2
Non-cash investing activity:


Transfers of property, plant and equipment in exchange for other non-current assets	17		—
Non-cash financing activity:
Declared and accrued dividends on common stock	103		85

The balance in property, plant and equipment, net of accumulated depreciation funded with accounts payable and accrued liabilities was $354 million and $234 million as of September 30, 2022 and 2021, respectively.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Information Regarding Forward-Looking Statements

This quarterly report contains certain statements that are, or may be deemed to be, “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements, other than statements of historical or present facts or conditions, included herein or incorporated herein by reference are “forward-looking statements.” Included among “forward-looking statements” are, among other things:

•statements that we expect to commence or complete construction of our proposed LNG terminals, liquefaction facilities, pipeline facilities or other projects, or any expansions or portions thereof, by certain dates, or at all;

•statements regarding future levels of domestic and international natural gas production, supply or consumption or future levels of LNG imports into or exports from North America and other countries worldwide or purchases of natural gas, regardless of the source of such information, or the transportation or other infrastructure or demand for and prices related to natural gas, LNG or other hydrocarbon products;

•statements regarding any financing transactions or arrangements, or our ability to enter into such transactions;

•statements relating to Cheniere’s capital deployment, including intent, ability, extent, and timing of capital expenditures, debt repayment, dividends, share repurchases and ~~share repurchases;~~execution on the capital allocation plan;

•statements regarding our future sources of liquidity and cash requirements;

•statements relating to the construction of our Trains and pipelines, including statements concerning the engagement of any EPC contractor or other contractor and the anticipated terms and provisions of any agreement with any EPC or other contractor, and anticipated costs related thereto;

•statements regarding any SPA or other agreement to be entered into or performed substantially in the future, including any revenues anticipated to be received and the anticipated timing thereof, and statements regarding the amounts of total LNG regasification, natural gas liquefaction or storage capacities that are, or may become, subject to contracts;

•statements regarding counterparties to our commercial contracts, construction contracts and other contracts;

•statements regarding our planned development and construction of additional Trains or pipelines, including the financing of such Trains or pipelines;

•statements that our Trains, when completed, will have certain characteristics, including amounts of liquefaction capacities;

•statements regarding our business strategy, our strengths, our business and operation plans or any other plans, forecasts, projections, or objectives, including anticipated revenues, capital expenditures, maintenance and operating costs and cash flows, any or all of which are subject to change;

•statements regarding legislative, governmental, regulatory, administrative or other public body actions, approvals, requirements, permits, applications, filings, investigations, proceedings or decisions;

•statements regarding our anticipated LNG and natural gas marketing activities;

•statements regarding the outbreak of COVID-19 and its impact on our business and operating results, including any customers not taking delivery of LNG cargoes, the ongoing credit worthiness of our contractual counterparties, any disruptions in our operations or construction of our Trains and the health and safety of our employees, and on our customers, the global economy and the demand for LNG; and

•any other statements that relate to non-historical or future information.

All of these types of statements, other than statements of historical or present facts or conditions, are forward-looking statements. In some cases, forward-looking statements can be identified by terminology such as “may,” “will,” “could,” “should,” “achieve,” “anticipate,” “believe,” “contemplate,” “continue,” “estimate,” “expect,” “intend,” “plan,” “potential,” “predict,” “project,” “pursue,” “target,” the negative of such terms or other comparable terminology. The forward-looking statements contained in this quarterly report are largely based on our expectations, which reflect estimates and assumptions made by our management. These estimates and assumptions reflect our best judgment based on currently known market

conditions and other factors. Although we believe that such estimates are reasonable, they are inherently uncertain and involve a number of risks and uncertainties beyond our control. In addition, assumptions may prove to be inaccurate. We caution that the forward-looking statements contained in this quarterly report are not guarantees of future performance and that such

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statements may not be realized or the forward-looking statements or events may not occur. Actual results may differ materially from those anticipated or implied in forward-looking statements as a result of a variety of factors described in this quarterly report and in the other reports and other information that we file with the SEC, including those discussed under “Risk Factors” in our annual report on Form 10-K for the fiscal year ended December 31, ~~2020~~2021. All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by these risk factors. These forward-looking statements speak only as of the date made, and other than as required by law, we undertake no obligation to update or revise any forward-looking statement or provide reasons why actual results may differ, whether as a result of new information, future events or otherwise.

Introduction

The following discussion and analysis presents management’s view of our business, financial condition and overall performance and should be read in conjunction with our Consolidated Financial Statements and the accompanying notes. This information is intended to provide investors with an understanding of our past performance, current financial condition and outlook for the future.

Our discussion and analysis includes the following subjects:

•Overview ~~of Business~~

•Overview of Significant Events

•Results of Operations

•Liquidity and Capital Resources

•~~Off-Balance Sheet Arrangements~~

•Summary of Critical Accounting Estimates

•Recent Accounting Standards

Overview ~~of Business~~

Cheniere, a Delaware corporation, is a Houston-based energy infrastructure company primarily engaged in LNG-related businesses. We provide clean, secure and affordable LNG to integrated energy companies, utilities and energy trading companies around the world. We aspire to conduct our business in a safe and responsible manner, delivering a reliable, competitive and integrated source of LNG to our customers.

LNG is natural gas (methane) in liquid form. The LNG we produce is shipped all over the world, turned back into natural gas (called “regasification”) and then transported via pipeline to homes and businesses and used as an energy source that is essential for heating, cooking and other industrial uses. Natural gas is a cleaner-burning, abundant and affordable source of energy. When LNG is converted back to natural gas, it can be used instead of coal, which reduces the amount of pollution traditionally produced from burning fossil fuels, like sulfur dioxide and particulate matter that enters the air we breathe. Additionally, compared to coal, it produces significantly fewer carbon emissions. By liquefying natural gas, we are able to reduce its volume by 600 times so that we can load it onto special LNG carriers designed to keep the LNG cold and in liquid form for efficient transport overseas.

We own and operate the natural gas liquefaction and export facility located in Cameron Parish, Louisiana at Sabine Pass (the “Sabine Pass LNG ~~terminal in Louisiana,~~Terminal”), one of the largest LNG production facilities in the world, through our ownership interest in and management agreements with ~~Cheniere Partners,~~CQP, which is a publicly traded limited partnership that we ~~created~~formed in 2007. As of September 30, ~~2021,~~2022, we owned 100% of the general partner interest and a 48.6% ~~of the~~ limited partner interest in ~~Cheniere Partners. We also own and operate the Corpus Christi LNG terminal in Texas, which is wholly owned by us.~~

~~Cheniere Partners owns the~~CQP. The Sabine Pass LNG ~~terminal located in Cameron Parish, Louisiana, which~~Terminal has ~~natural gas liquefaction facilities consisting of five~~six operational ~~natural gas liquefaction~~ Trains, ~~and one additional~~with Train ~~that is undergoing commissioning and expected to be substantially completed in the first quarter of~~6 having achieved substantial completion on February 4, 2022, for a total operational production capacity of approximately 30 mtpa of LNG (the “SPL Project”). The Sabine Pass LNG ~~terminal~~Terminal also has operational regasification facilities that include five LNG storage tanks with aggregate capacity of approximately 17 Bcfe, ~~two existing~~three marine berths, ~~and one under construction that~~with the third berth having achieved substantial completion on October 27, 2022, two of which can ~~each~~ accommodate vessels with nominal capacity of up to 266,000 cubic meters and the third berth which can accommodate vessels with nominal capacity of up to 200,000 cubic meters, and vaporizers with regasification capacity of approximately 4 Bcf/d. ~~Cheniere Partners~~CQP also owns a 94-mile pipeline through its subsidiary, CTPL, that interconnects the Sabine Pass LNG ~~terminal~~Terminal with a number of large interstate and intrastate pipelines.

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We also own and operate the ~~Corpus Christi LNG terminal~~natural gas liquefaction and export facility located near Corpus Christi, Texas ~~and currently operate~~(the “Corpus Christi LNG Terminal”) through CCL, which has natural gas liquefaction facilities consisting of three operational Trains for a total production capacity of approximately 15 mtpa of ~~LNG. Additionally, we operate a 23-mile natural gas supply pipeline that interconnects the Corpus Christi~~ LNG, terminal with several interstate and intrastate natural gas pipelines (the “Corpus Christi Pipeline” and together with the Trains, the “CCL Project”) through our subsidiaries CCL and CCP, respectively, as part of the

~~CCH Group. The CCL Project also contains~~ three LNG storage tanks with aggregate capacity of approximately 10 Bcfe and two marine berths that can each accommodate vessels with nominal capacity of up to 266,000 cubic meters.

Additionally, ~~separate from the CCH Group,~~ we are ~~developing~~constructing an expansion of the Corpus Christi LNG ~~terminal adjacent to the CCL Project (“Corpus~~Terminal (the “Corpus Christi Stage 3”3 Project”) ~~through our subsidiary CCL Stage III~~ for up to seven midscale Trains with an expected total production capacity ~~of approximately~~over 10 mtpa of LNG. WeCCL Stage III, CCL and CCP received approval from FERC in November 2019 to site, construct and operate the ~~expansion project.~~Corpus Christi Stage 3 Project. In March 2022, CCL Stage III ~~has entered~~issued limited notice to proceed to Bechtel Energy Inc. (“Bechtel”) to commence early engineering, procurement and site works. In June 2022, our board of directors (our “Board”) made a positive FID with respect to the Corpus Christi Stage 3 Project and issued a full notice to proceed with construction to Bechtel effective June 16, 2022. In connection with the positive FID, CCL Stage III, through which we are developing and constructing the Corpus Christi Stage 3 Project, was contributed to CCH and subsequently merged with and into ~~various IPM~~CCL, with CCL the surviving entity of the merger and a wholly owned subsidiary of CCH. We also own and operate through CCP a 21.5-mile natural gas supply ~~agreements.~~pipeline that interconnects the Corpus Christi LNG Terminal with several interstate and intrastate natural gas pipelines (the “Corpus Christi Pipeline” and together with the existing operational Trains, midscale Trains, storage tanks and marine berths, the “CCL Project”).

We ~~have contracted~~are the largest producer of LNG in the United States and the second largest LNG producer globally, based on the total production capacity of our operating asset platforms of approximately 45 mtpa as of September 30, 2022.

Our customer arrangements provide us with significant, stable and long-term cash flows. We contract our anticipated production capacity under SPAs, in which ~~the~~our customers are generally required to pay a fixed fee with respect to the contracted volumes irrespective of their election to cancel or suspend deliveries of LNG cargoes, and under IPM ~~gas supply~~ agreements, in which the gas producer sells natural gas to us on a global LNG index price, less a fixed liquefaction fee, shipping and other costs. WeThrough our SPAs and IPM agreements, we have contracted approximately ~~90%~~95% of the total anticipated production ~~capacity~~ from the SPL Project and the CCL Project (collectively, the “Liquefaction Projects”)~~, including those~~ through the mid-2030s, inclusive of contracts executed to support additional liquefaction capacity at the Corpus Christi LNG Terminal beyond the Corpus Christi Stage ~~3. Substantially all of our contracted capacity is from contracts with terms exceeding 10 years.~~3 Project. Excluding contracts with terms less than 10 years and contracts executed to support additional liquefaction capacity at the Corpus Christi LNG Terminal beyond the Corpus Christi Stage 3 Project, our SPAs and IPM ~~gas supply~~ agreements had approximately ~~17.5~~17 years of weighted average remaining life as of September 30, ~~2021.~~2022. We also market and sell LNG produced by the Liquefaction Projects that is not required for other customers through our integrated marketing function. In March 2022, the DOE authorized the export of an additional 152.64 Bcf/yr and 108.16 Bcf/yr of domestically produced LNG by vessel from the Sabine Pass LNG Terminal and the Corpus Christi LNG Terminal, respectively, through December 31, 2050 to non-FTA countries, that were previously authorized for FTA countries only. For further discussion of the contracted future cash flows under our revenue arrangements, see the liquidity and capital resources disclosures in our annual report on Form 10-K for the fiscal year ended December 31, 2021.

We remain focused on operational excellence and customer satisfaction. Increasing demand for LNG has allowed us to expand our liquefaction infrastructure in a financially disciplined manner. We have increased available liquefaction capacity at our Liquefaction Projects as a result of debottlenecking and other optimization projects. We hold significant land positions at both the Sabine Pass LNG ~~terminal~~Terminal and the Corpus Christi LNG ~~terminal~~Terminal, which provide opportunity for further liquefaction capacity expansion. In August 2022, certain of our subsidiaries initiated the pre-filing review process with the FERC under the National Environmental Policy Act for an expansion adjacent to the CCL Project consisting of two midscale Trains with an expected total production capacity of approximately 3 mtpa of LNG. The development of these sites or other projects, including infrastructure projects in support of natural gas supply and LNG demand, will require, among other things, acceptable commercial and financing arrangements before we ~~can~~ make a ~~final investment decision (“FID”).~~positive FID.

Additionally, we are committed to the responsible and proactive management of our most important environmental, social and governance (“ESG”) impacts, risks and opportunities. WeIn June 2022, we published our ~~2020~~2021 Corporate Responsibility (“CR”) report, which details our ~~strategy~~approach and progress on ESG issues, including our collaboration with natural gas midstream companies, methane detection technology providers and leading academic institutions to implement quantification, monitoring, reporting and verification of greenhouse gas (“GHG”) emissions at natural gas gathering, processing, transmission and storage systems specific to our supply chain, as well as our ~~efforts on integrating climate considerations into~~contributions to energy security during a critical time in history. Additionally, we commenced providing Cargo Emissions Tags (“CE Tags”) to our ~~business strategy and taking a leadership position on increased environmental transparency, including conducting a climate scenario analysis and our plan to~~long-term customers in June 2022. The CE Tags provide ~~LNG~~ customers with ~~Cargo Emission Tags. In August 2021, we~~estimated GHG emissions data associated with each LNG cargo produced at the Liquefaction Projects and are provided for both free-on-board (“FOB”) and delivered ex-ship (“DES”) LNG cargoes. We also ~~announced~~joined the Oil and Gas Methane Partnership (“OGMP”) 2.0, the United Nations Environment Programme’s

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(“UNEP”) flagship oil and gas methane emissions reporting and mitigation initiative in October 2022. OGMP 2.0 is a ~~peer-reviewed LNG life cycle assessment study which allows for improved greenhouse gas~~comprehensive, measurement-based reporting framework intended to improve the accuracy and transparency of methane emissions ~~assessment, which was published~~reporting in the ~~American Chemical Society Sustainable Chemistry & Engineering Journal~~.oil and gas sector. Our CR report is available at cheniere.com/~~IMPACT.~~our-responsibility/reporting-center. Information on our website, including the CR report, is not incorporated by reference into this Quarterly Report on Form 10-Q.

Overview of Significant Events

Our significant events since January 1, ~~2021~~2022 and through the filing date of this Form 10-Q include the following:

Strategic

•~~In September 2021,~~On October 3, 2022, our Board appointed Mr. Brian E. Edwards to serve as a member of ~~Directors approved a long-term capital allocation plan which includes (i)~~our Board. Mr. Edwards was appointed to the ~~repurchase, repayment or retirement~~Audit Committee and the Compensation Committee of approximately $1.0 billion of existing indebtedness of the Company each year through 2024 with the intent of achieving consolidated investment grade credit metrics, (ii) initiation of a quarterly dividend for third quarter 2021 at $0.33 per share, payable November 17, 2021 to shareholders of record as of November 3, 2021 and (iii) the authorization of an increase in the share repurchase program to $1.0 billion, inclusive of any amounts remaining under the previous authorization as of September 30, 2021, for a three-year term effective October 1, 2021.our Board.

•In ~~July 2021,~~September 2022, we announced the appointment of Corey Grindal, currently Executive Vice President, Worldwide Trading, as Executive Vice President and Chief Operating Officer of the Company, effective January 2, 2023.

•On June 15, 2022, our Board made a positive FID with respect to the Corpus Christi Stage 3 Project and issued a full notice to proceed with construction to Bechtel effective June 16, 2022. In connection with the positive FID, CCL Stage III was contributed to CCH and subsequently merged with and into CCL, with CCL the surviving company of the merger and a wholly owned subsidiary of CCH. In connection with the merger, contracts held by CCL Stage III were transferred to CCL.

•In March 2022, CCL Stage III entered into an EPC contract with Bechtel for the Corpus Christi Stage 3 Project for a contract price of approximately $5.5 billion, subject to adjustment only by change order. As described above, CCL Stage III issued a full notice to proceed with construction to Bechtel in June 2022, which followed the issuance of a limited notice to proceed to commence early engineering, procurement and site works in March 2022.

•We entered into, or amended, the following agreements:

◦We entered into new and amended long-term SPAs aggregating approximately 140 million tonnes of LNG to be delivered between 2026 and 2050, inclusive of long-term SPAs with Engie SA, Equinor ASA, Chevron U.S.A. Inc. (“Chevron”), POSCO International Corporation, PetroChina International Company Limited and PTT Global LNG Company Limited, approximately 50 million tonnes of which is subject to Cheniere making a final investment decision to construct additional liquefaction capacity at the Corpus Christi LNG Terminal beyond the seven-train Corpus Christi Stage 3 Project or us unilaterally waiving that requirement.

◦In May 2022, CCL Stage III entered into an IPM ~~gas supply~~ agreement with ~~Tourmaline Oil Marketing Corp.~~ARC Resources U.S. Corp, a subsidiary of ARC Resources, Ltd., to purchase 140,000 MMBtu per day of natural gas at a price based on ~~the~~ Platts Japan Korea Marker (“JKM”), for a term of approximately 15 years ~~beginning in early 2023.~~commencing with commercial operations of Train 7 of the Corpus Christi Stage 3 Project.

•◦In ~~July 2021,~~February 2022, CCL Stage III amended the board of directors of the Company (the “Board”) appointed Mses. Patricia K. Collawn and Lorraine Mitchelmore to serve as members of the Board. Ms. Collawn was appointed to the Audit Committee and the Compensation Committee of the Board, and Ms. Mitchelmore was appointed to the Audit Committee and the Governance and Nominating Committee of the Board.

•Our subsidiaries entered into SPAs with multiple counterparties for portfolio volumes aggregating approximately 34 million tonnes of LNG to be delivered between 2021 and 2035, inclusive of long-term SPAsIPM agreement previously entered into with ~~ENN LNG (Singapore) Pte Ltd.~~EOG Resources, Inc. (“EOG”), increasing the volume and term of natural gas supply from 140,000 MMBtu per day for 10 years, to 420,000 MMBtu per day for 15 years, with pricing continuing to be based on JKM. Under the amended IPM agreement, supply is targeted to commence upon completion of Trains 1, 4 and 5 of the Corpus Christi Stage 3 Project. In addition, the previously executed gas supply agreement, under which EOG sells 300,000 MMBtu per day to CCL Stage III at a ~~subsidiary~~price indexed to Henry Hub, has been extended by 5 years, resulting in a 15 year term that is expected to commence upon start-up of ~~Glencore plc.~~the amended IPM agreement.

Operational

•As of October 31, ~~2021, over 1,800~~2022, approximately 2,450 cumulative LNG cargoes totaling over ~~135~~165 million tonnes of LNG have been produced, loaded and exported from the Liquefaction Projects.

•~~In September 2021, feed gas~~On October 27, 2022, substantial completion of the third berth at the Sabine Pass Terminal was ~~introduced to~~achieved.

•On February 4, 2022, substantial completion of Train 6 of the SPL ~~Project.~~Project was achieved (the “Train 6 Completion”).

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Financial

•~~On March 26, 2021, substantial completion~~In September 2022, Moody’s Corporation upgraded its issuer credit ratings of ~~Train 3~~Cheniere, CQP and SPL from Ba3, Ba2 and Baa3, respectively, to Ba1, Ba1 and Baa2, respectively, with a stable outlook. Additionally in September 2022, Fitch Ratings upgraded its issuer credit ratings of ~~the CCL Project was achieved.~~CQP and SPL from BB+ and BBB-, respectively, to BBB- and BBB, respectively, with a stable outlook.

~~Financial~~

•~~We completed the following financing transactions:~~In September 2022, our Board approved a revised comprehensive, long-term capital allocation plan which included:

◦increasing the share repurchase authorization by $4.0 billion for an additional 3 years, beginning on October 1, 2022;

◦lowering the Company’s consolidated long-term leverage target to approximately 4x;

◦increasing the Company’s dividend by 20% commencing with a declared distribution of $0.395 per common share in September 2022 (payable in November 2022), and targeting an approximate 10% annual dividend growth rate through Corpus Christi Stage 3 Project construction; and

◦continuing to invest in accretive organic growth.

•In ~~October 2021, we~~June 2022, CCH amended and restated ~~our $1.25 billion Cheniere Revolving~~its term loan credit facility (the “CCH Credit ~~Facility (“Cheniere Revolving Credit~~Facility”) and its working capital facility (the “CCH Working Capital Facility”) to, among other things, (1) increase the commitments to approximately $4.0 billion and $1.5 billion for the CCH Credit Facility and the CCH Working Capital Facility, respectively, which are intended to fund a portion of the cost of developing, constructing and operating the Corpus Christi Stage 3 Project, (2) extend the maturity ~~through October 2026, (2) reduce~~of the CCH Credit Facility to the earlier of June 15, 2029 or two years after the substantial completion of the last Train of the Corpus Christi Stage 3 Project and extend the maturity of the CCH Working Capital Facility to June 15, 2027, (3) update the indexed interest rate to SOFR and commitment fees, which can be further reduced based on our credit ratings and may be positively or negatively adjusted up to five basis points on the interest rate and up to one basis point on the commitment fees based on the achievement of defined ESG milestones and (3)(4) make certain other changes to the terms and conditions of ~~the~~each existing ~~revolving credit~~ facility.

◦•InDuring the three and nine months ended September ~~2021, Cheniere Partners issued an aggregate principal amount~~30, 2022, we used $1.3 billion and $3.5 billion, respectively, of ~~$1.2~~available cash to reduce our outstanding indebtedness, of which $1.3 billion and $3.2 billion, respectively, was the redemption or prepayment of 3.25% Senior Notes due 2032 (the “2032 CQP Senior Notes”). Net proceeds of the 2032 CQP Senior Notes were used to redeem a portion of the outstanding $1.1 billion aggregate principal amount of the 5.625% Senior Notes due 2026 (the “2026 CQP Senior Notes”) in September 2021indebtedness pursuant to a tender offer. In October 2021, the remaining net proceeds of the 2032 CQP Senior Notes were used to redeem the remaining outstanding principal amount of the 2026 CQP Senior Notes and, together with cash on hand, redeem $318 million of the 6.25% Senior Secured Notes due 2022 (the “2022 SPL Senior Notes”).our capital allocation plan.

◦•In August 2021, CCH issued an aggregate principal amount of $750 million of fully amortizing 2.742% Senior Secured Notes due 2039 (the “2.742% CCH Senior Secured Notes”). The net proceeds of the 2.742% CCH Senior Secured Notes were usedAlso pursuant to ~~prepay a portion of the principal amount outstanding under CCH’s amended and restated term loan credit facility (the “CCH Credit Facility”).~~our capital allocation priorities:

◦During ~~2021, SPL entered into a series~~the three and nine months ended September 30, 2022, we repurchased approximately 0.6 million and 5.0 million shares of ~~note purchase agreements for the sale~~our common stock as part of approximately $482 million aggregate principal amount of Senior Secured Notes due 2037, on a private placement basis (the “2037 SPL Private Placement Senior Secured Notes”). The 2037 SPL Private Placement Senior Secured Notes are expected to be issued in the fourth quarter of 2021, subject to customary closing conditions, and the net proceeds will be used to redeem a portion of the 2022 SPL Senior Notes and pay related fees, costs and expenses. The 2037 SPL Private Placement Senior Secured Notes will be fully amortizing, with a weighted average life of over 10 years and a weighted average interest rate of 3.07%.

◦In March 2021, Cheniere Partners issued an aggregate principal amount of approximately $1.5 billion of 4.000% Senior Notes due 2031 (the “2031 CQP Senior Notes”). The net proceeds of the 2031 CQP Senior Notes, along with cash on hand, were used to redeem the 5.250% Senior Notes due 2025 (the “2025 CQP Senior Notes”) and to pay fees and expenses in connection with the redemption.

•~~In July 2021,~~our share repurchase ~~activities recommenced pursuant to the June 2019 repurchase plan, with 77,100~~program for approximately $75 million and $640 million, respectively. The shares repurchased ~~during the third quarter.~~

•~~In line with our capital allocation plan, we have repaid $750 million of debt with available cash~~ during the nine months ended September 30, ~~2021 as follows: (1) fully repaid $148~~2022 include approximately 2.7 million shares of our common stock beneficially owned by Icahn Capital LP and certain affiliates of Icahn Capital LP (the “Icahn Group”) that we repurchased for approximately $350 million;

◦In October 2022, SPL redeemed $300 million of ~~total~~ outstanding ~~indebtedness~~borrowings under ~~Cheniere’s term loan facility (the “Cheniere Term Loan Facility”) and $476 million~~its 5.625% Senior Secured Notes due 2023 pursuant to a notice of ~~Cheniere’s 4.875% convertible notes due May 2021 (“2021 Cheniere Convertible Notes”) with $500 million~~redemption issued in September 2022;

◦Additionally, we paid aggregate dividends of ~~available cash and~~$0.99 per share of common stock during the ~~remainder from~~nine months ended September 30, 2022.

~~borrowings under the Cheniere Revolving Credit Facility, (2) $134 million repayment~~Table of ~~the Cheniere Revolving Credit Facility with available cash and (3) $116 million repayment of the CCH Credit Facility with available cash.~~

•Contents~~In April 2021, S&P Global Ratings changed the outlook of Cheniere and Cheniere Partners’ ratings to positive from negative.~~

•In February 2021, Fitch Ratings (“Fitch”) changed the outlook of SPL’s senior secured notes rating to positive from stable and the outlook of Cheniere Partners’ long-term issuer default rating and senior unsecured notes rating to positive from stable.

•~~In January 2021, the term commenced on Cheniere Marketing International LLP’s 25 year SPA with CPC Corporation, Taiwan.~~

Results of Operations

The following charts summarize the total revenues and total LNG volumes loaded from our Liquefaction Projects ~~(including both operational and commissioning volumes)~~ during the nine months ended September 30, ~~2021~~2022 and ~~2020:~~2021:

The following table summarizes the volumes of operational and commissioning LNG cargoes that were loaded from the Liquefaction Projects, which were recognized on our Consolidated Financial ~~Statements~~Statements:


	Three Months Ended September 30, 2022		Nine Months Ended September 30, 2022
(in TBtu)	Operational	Commissioning	Operational	Commissioning
Volumes loaded during the current period	559	—	1,695	13
Volumes loaded during the prior period but recognized during the current period	34	—	49	1
Less: volumes loaded during the current period and in transit at the end of the period	(37)	—	(37)	—
Total volumes recognized in the current period	556	—	1,707	14

Net loss attributable to common stockholders


	Three Months Ended September 30,						Nine Months Ended September 30,
(in millions, except per share data)	2022		2021		Variance		2022		2021		Variance
Net loss attributable to common stockholders	$	(2,385)	$	(1,084)	$	(1,301)	$	(2,509)	$	(1,020)	$	(1,489)
Net loss per share attributable to common stockholders—basic and diluted	(9.54)		(4.27)		(5.27)		(9.94)		(4.03)		(5.91)

The $1.3 billion and $1.5 billion increase in net loss during the three and nine months ended September 30, ~~2021:~~

Three Months Ended September 30, 2021 Nine Months Ended September 30, 2021
(in TBtu) Operational Commissioning Operational Commissioning
Volumes loaded during the current period 500 — 1,447 28
Volumes loaded during the prior period but recognized during the current period 23 — 26 3
Less: volumes loaded during the current period and in transit at the end of the period (34) — (34) —
Total volumes recognized in the current period 489 — 1,439 31

~~Net income (loss) attributable to common stockholders~~

Three Months Ended September 30, Nine Months Ended September 30,
(in millions, except per share data) 2021 2020 Change 2021 2020 Change
Net income (loss) attributable to common stockholders $ (1,084) $ (463) $ (621) $ (1,020) $ 109 $ (1,129)
Net income (loss) per share attributable to common stockholders—basic and diluted (4.27) (1.84) (2.43) (4.03) 0.43 (4.46)

~~Net income attributable to common stockholders decreased by$621 million and $1.1 billion during the three and nine months ended September 30, 2021,~~2022, respectively, from the comparable 2021 periods ~~in 2020,~~were primarily due to ~~the~~an increase in derivative losses from changes in fair value and settlements of~~$3.4~~ $2.2 billionand ~~$4.5~~$6.0 billion ~~(pre-tax~~(before tax and ~~excluding~~ the impact of non-controlling interest), respectively, between the ~~three and nine months~~ periods, ~~respectively,~~ as further described below. ~~This impact~~The unfavorable variance was partially offset by increased ~~volume and revenue~~gross margin per MMBtu ofon LNG delivered primarily due to higher margins on sales indexed to or derived from international gas prices as a result of ~~$1.3 billion~~increases in the associated indices and ~~$2.2 billion (pre-tax and excluding~~sales indexed to Henry Hub, generally at 115%. Also contributing to the ~~impact of non-controlling interest)~~increase in gross margin, to a lesser extent, was an increase in volume delivered during the three and nine months ended September 30, ~~2021, respectively,~~2022 from the comparable periods in ~~2020, as well as~~2021, in part due to substantial completion and commencement of operations of Train 3 of the ~~volatility~~CCL Project on March 26, 2021 (the “Train 3 Completion”) and the Train 6 Completion. Additionally offsetting the increases in ~~our effective tax rate~~net loss during the ~~three and nine months ended September 30, 2021 due to variability in our earnings and~~periods was the ~~proportion~~recognition of ~~such earnings attributable to non-controlling interest.~~increased regasification revenues from Chevron, as further described below.

Substantially all ~~after-tax~~ derivative losses relate to the use of commodity derivative instruments ~~principally those~~ indexed to international LNG ~~prices.~~prices, primarily related to our IPM agreements. While operationally we utilize commodity derivatives to mitigate price

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volatility for commodities procured or sold over a period of time, as a result of significant appreciation in forward international LNG commodity curves during the three and nine months ended September 30, ~~2021,~~2022, we recognized ~~$3.2~~$5.0 billion and ~~$4.0~~$9.2 billion, respectively, of non-cash unfavorable changes in fair value attributed to positions indexed to such prices ~~(pre-tax~~(before tax and ~~excluding~~ the impact of non-controlling interest), including our IPM gas supply agreements and certain physical and financial derivatives entered into economically hedge exposure to commodity markets in which we have contractual agreements to purchase or sell physical LNG..

Derivative instruments, which in addition to managing exposure to commodity-related marketing and price risks are utilized to manage exposure to changing interest rates and foreign exchange volatility, are reported at fair value on our Consolidated Financial Statements. For commodity derivative instruments related to our IPM agreements, including those entered into during the nine months ended September 30, 2022 as described further in Overview of Significant Events~~In some cases,~~, the underlying ~~transactions~~LNG sales being economically hedged are accounted for under the accrual method of accounting, whereby revenues ~~and expenses~~expected to be derived from the future LNG sales are recognized only upon delivery ~~receipt~~ or realization of the underlying transaction.Because the recognition of derivative instruments at fair value has the effect of recognizing gains or losses relating to future period exposure, and given the significant volumes, long-term duration and volatility in price basis for certain of our derivative contracts, use of derivative instruments may result in continued volatility of our results of operations based on changes in market pricing, counterparty credit risk and other relevant factors, notwithstanding the operational intent to mitigate risk exposure over time.

~~Revenues~~

Three Months Ended September 30, Nine Months Ended September 30,
(in millions) 2021 2020 Change 2021 2020 Change
LNG revenues $ 3,078 $ 1,373 $ 1,705 $ 8,990 $ 6,236 $ 2,754
Regasification revenues 68 67 1 202 202 —
Other revenues 54 20 34 115 133 (18)
Total revenues $ 3,200 $ 1,460 $ 1,740 $ 9,307 $ 6,571 $ 2,736
In June 2022, Chevron entered into an agreement with SPLNG providing for the early termination of the TUA and an associated terminal marine services agreement between the parties and their affiliates for a lump sum fee of $765 million (the “Termination Fee”). Obligations pursuant to the TUA and associated agreement, including Chevron’s obligation to pay SPLNG capacity payments totaling $125 million annually (adjusted for inflation) from 2023 through 2029, will terminate upon the later of SPLNG’s receipt of the Termination Fee or December 31, 2022. The termination agreement became effective on July 6, 2022. We have allocated the $765 million Termination Fee to the terminated commitments, with $796 million in cash inflows allocable to the termination of the TUA, which we are recognizing ratably over the July 6, 2022 to December 31, 2022 period as regasification revenues on our Consolidated Statements of Operations, and an offsetting $31 million in cash outflows allocable to the extinguishment of other remaining obligations we have to Chevron, which will be recognized upon receipt of the Termination Fee as a loss on extinguishment of debt on our Consolidated Statements of Operations.

As described in Overview of Significant Events, during the nine months ended September 30, 2022, we entered into SPAs with various counterparties for approximately 140 million tonnes of LNG to be delivered between 2026 and 2050. We expect our net income or loss in the future to be impacted by the revenues and associated expenses related to the commencement of these agreements.

Revenues


	Three Months Ended September 30,						Nine Months Ended September 30,
(in millions)	2022		2021		Variance		2022		2021		Variance
LNG revenues	$	8,236	$	3,078	$	5,158	$	23,449	$	8,990	$	14,459
Regasification revenues	455		68		387		591		202		389
Other revenues	161		54		107		303		115		188

Total revenues	$	8,852	$	3,200	$	5,652	$	24,343	$	9,307	$	15,036

Total revenues increased during the three and nine months ended September 30, ~~2021~~2022 from the comparable periods in ~~2020,~~2021, primarily as a result of increased pricing due to appreciation in underlying indices as described in Net loss attributable to common stockholders above. To a lesser extent, revenues ~~per MMBtu and~~increased as a result of higher ~~volume~~volumes of LNG delivered between the periods due to additional production capacity aggregating to approximately 10 mtpa arising from the ~~non-recurrence of notification by our customers to not take delivery of scheduled LNG during~~Train 3 Completion and the three and nine months ended September 30, 2021. Revenues per MMBtu of LNG was higher due to improved market prices recognized by our integrated marketing function and as a result of variable fees that are received in addition to fixed fees when the customers take delivery of the cargo as opposed to exercising their contractual right to not take delivery. During the three and nine months ended September 30, 2020, we recognized $171 million and $932 million, respectively, in LNG revenues associated with LNG cargoes for which customers notified us that they would not take delivery, of which $47 million would have been recognized subsequent to September 30, 2020 had the cargoes been lifted pursuant to the delivery schedules with the customers. LNG

Train 6 Completion.

revenues during the three months ended September 30, 2020 and nine months ended September 30, 2021 excluded $458 million and $38 million, respectively, that would have otherwise been recognized during the quarter if the cargoes were lifted pursuant to the delivery schedules with the customers. We did not have revenues associated with LNG cargoes for which customers notified us that they would not take delivery during the three and nine months ended September 30, 2021.

Prior to substantial completion of a Train, amounts received from the sale of commissioning cargoes from that Train are offset against LNG terminal construction-in-process, because these amounts are earned or loaded during the testing phase for the construction of that Train. During the nine months ended September 30, 2022 and 2021, we realized offsets to LNG terminal costs of~~$227~~ $204 million and $227 million, corresponding to 15 TBtu and 31 TBtu, respectively, that were related to the sale of commissioning cargoes from ~~Train 3 of~~ the ~~CCL Project.~~Liquefaction Projects. We did not realize any offsets to LNG terminal costs during the three months ended September 30, ~~2021~~2022 and ~~three and nine months ended September 30, 2020.~~2021.

Also included in LNG revenues are sales of certain unutilized natural gas procured for the liquefaction process and other revenues, which was $94 million and $243 million during the three months ended September 30, 2021 and 2020, respectively, and $241 million and $397 million during the nine months ended September 30, 2021 and 2020, respectively. Additionally, LNG revenues include gains and losses from derivative instruments, which include the realized value associated with a portion of derivative instruments that settle through physical delivery. We recognized offsets to revenues ~~(offsets to revenues)~~ of ~~$(1,092)~~$186 million and ~~$29~~

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$1,092 million during the three months ended September 30, ~~2021~~2022 and ~~2020,~~2021, respectively, and ~~$(1,515)~~$325 million and ~~$148~~$1,515 million during the nine months ended September 30, ~~2021~~2022 and ~~2020,~~2021, respectively, related to the gains and losses from derivative instruments primarily due to shifts in forward commodity curves. Also included in LNG revenues are sales of certain unutilized natural gas procured for the liquefaction process and other revenues, which was $26 million and $93 million during the three months ended September 30, 2022 and 2021, respectively, and $148 million and $240 million during the nine months ended September 30, 2022 and 2021.

~~We expect our~~Regasification revenues increased by $387 million and $389 million during the three and nine months ended September 30, 2022 from the comparable periods in 2021, respectively, primarily due to the recognition of increased regasification revenues from Chevron, as described in Net loss attributable to common stockholders above.

Other revenues increased by $107 million and $188 million during the three and nine months ended September 30, 2022 from the comparable periods in 2021, respectively, primarily due to an increase in sublease income from LNG ~~revenues to~~vessel subcharters primarily as a result of higher rates and an increase in the ~~future upon Train 6~~number of days subchartered due to extra charter vessel capacity available during the ~~SPL Project becoming operational, which is expected in the first quarter of 2022.~~periods.

The following table presents the components of LNG revenues and the corresponding LNG volumes delivered:


		Three Months Ended September 30,				Nine Months Ended September 30,				Three Months Ended September 30,				Nine Months Ended September 30,
		2021		2020		2021		2020				2022		2021		2022		2021
LNG revenues (in millions):	LNG revenues (in millions):										LNG revenues (in millions):
LNG from the Liquefaction Projects sold under third party long-term agreements (1)	LNG from the Liquefaction Projects sold under third party long-term agreements (1)	$	2,887	$	780	$	7,688	$	3,931		LNG from the Liquefaction Projects sold under third party long-term agreements (1)	$	6,084	$	2,887	$	15,652	$	7,688
LNG from the Liquefaction Projects sold by our integrated marketing function under short-term agreements	LNG from the Liquefaction Projects sold by our integrated marketing function under short-term agreements	1,075		65		2,277		540			LNG from the Liquefaction Projects sold by our integrated marketing function under short-term agreements	2,139		1,075		7,408		2,277
LNG procured from third parties	LNG procured from third parties	115		85		300		288			LNG procured from third parties	173		115		566		300
LNG revenues associated with cargoes not delivered per customer notification (2)		—		171		—		932
Net derivative gains (losses)		(1,092)		29		(1,515)		148

Net derivative losses											Net derivative losses	(186)		(1,092)		(325)		(1,515)
Other revenues	Other revenues	93		243		240		397			Other revenues	26		93		148		240
Total LNG revenues	Total LNG revenues	$	3,078	$	1,373	$	8,990	$	6,236		Total LNG revenues	$	8,236	$	3,078	$	23,449	$	8,990

Volumes delivered as LNG revenues (in TBtu):	Volumes delivered as LNG revenues (in TBtu):										Volumes delivered as LNG revenues (in TBtu):
LNG from the Liquefaction Projects sold under third party long-term agreements (1)	LNG from the Liquefaction Projects sold under third party long-term agreements (1)	386		145		1,170		764			LNG from the Liquefaction Projects sold under third party long-term agreements (1)	484		386		1,441		1,170
LNG from the Liquefaction Projects sold by our integrated marketing function under short-term agreements	LNG from the Liquefaction Projects sold by our integrated marketing function under short-term agreements	103		23		269		168			LNG from the Liquefaction Projects sold by our integrated marketing function under short-term agreements	72		103		266		269
LNG procured from third parties	LNG procured from third parties	10		31		38		79			LNG procured from third parties	4		10		19		38
Total volumes delivered as LNG revenues	Total volumes delivered as LNG revenues	499		199		1,477		1,011			Total volumes delivered as LNG revenues	560		499		1,726		1,477

(1)Long-term agreements include agreements with an initial tenure of 12 months or more.

~~(2)LNG revenues include revenues with no corresponding volumes due to revenues attributable to LNG cargoes for which customers notified us that they would not take delivery.~~

Operating costs and expenses


		Three Months Ended September 30,						Nine Months Ended September 30,						Three Months Ended September 30,				Nine Months Ended September 30,
(in millions)	(in millions)	2021		2020		Change		2021		2020		Change			(in millions)	2022		2021		Variance		2022		2021		Variance
Cost of sales	Cost of sales	$	4,868	$	768	$	4,100	$	8,408	$	2,295	$	6,113		Cost of sales	$	11,073	$	4,868	$	6,205	$	24,161	$	8,408	$	15,753

Operating and maintenance expense	Operating and maintenance expense	350		317		33		1,057		988		69			Operating and maintenance expense	419		350		69		1,227		1,057		170
Development expense	Development expense	2		—		2		5		5		—			Development expense	4		2		2		12		5		7
Selling, general and administrative expense	Selling, general and administrative expense	70		70		—		224		224		—			Selling, general and administrative expense	92		70		22		265		224		41
Depreciation and amortization expense	Depreciation and amortization expense	259		233		26		753		699		54			Depreciation and amortization expense	280		259		21		827		753		74

Impairment expense and loss on disposal of assets		1		—		1		—		5		(5)

Other															Other	—		1		(1)		3		—		3

Total operating costs and expenses	Total operating costs and expenses	$	5,550	$	1,388	$	4,162	$	10,447	$	4,216	$	6,231		Total operating costs and expenses	$	11,868	$	5,550	$	6,318	$	26,495	$	10,447	$	16,048

Our total operating costs and expenses increased by $6.3 billion and $16.0 billion during the three and nine months ended September 30, ~~2021~~2022 from the comparable periods in ~~2020, primarily as a result of increased cost of sales.~~

2021, respectively. Cost of sales includes costs incurred directly for the production and delivery of LNG from the Liquefaction Projects, to the extent those costs are not utilized for the commissioning process. Cost of sales also includes change in fair value of commodity derivatives to secure natural gas feedstock for the Liquefaction Projects, costs associated with the sale of certain unutilized natural gas procured for the

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liquefaction process, variable transportation and storage costs, port and canal fees and other costs to convert natural gas into LNG. Substantially all of the increase in operating costs and expenses in both comparable periods was attributed to cost of sales, which increased by $6.2 billion and $15.8 billion during the three and nine months ended September 30, ~~2021 from the comparable 2020 periods, primarily due to~~2022, respectively, as a result of increased pricing of natural gas feedstock ~~as a result of~~due to higher USU.S. natural gas prices and, to a lesser extent, from increased volume of LNG ~~delivered, as well as~~delivered. Additionally, the increase in cost of sales was due to unfavorable changes in our commodity derivatives to secure natural gas feedstock for the Liquefaction Projects, ~~driven by unfavorable shifts~~as discussed in ~~international forward commodity curves. Cost of sales also~~Net loss attributable to common stockholders above.

Operating and maintenance expense primarily includes costs associated with operating and maintaining the ~~sale of certain unutilized~~Liquefaction Projects. Operating and maintenance expense also includes service and maintenance, payroll and benefit costs, insurance, regulatory costs and other operating costs. During the three and nine months ended September 30, 2022, operating and maintenance expense increased from the comparable periods in 2021, primarily due to increased natural gas ~~procured for the liquefaction process and a portion of derivative instruments that settle through physical delivery, port and canal fees, variable~~ transportation and storage ~~costs, net of margins from~~capacity demand charges following the ~~sale of natural gas procured for~~Train 6 Completion and the ~~liquefaction process~~Train 3 Completion as well as third party service and ~~other costs to convert natural gas into LNG.~~maintenance contract costs.

~~We expect our operating costs~~Depreciation and ~~expenses to generally increase~~amortization expense increased during the three and nine months ended September 30, 2022 from the comparable period in 2021 primarily as a result of the ~~future upon~~ Train 6 ofCompletion and, to a lesser extent during the ~~SPL Project achieving substantial completion in~~nine months ended September 30, 2022, the ~~first quarter of 2022, although we expect certain costs will not proportionally increase with the number of operational Trains as cost efficiencies will be realized.~~Train 3 Completion.

Other expense (income)


		Three Months Ended September 30,						Nine Months Ended September 30,						Three Months Ended September 30,				Nine Months Ended September 30,
(in millions)	(in millions)	2021		2020		Change		2021		2020		Change			(in millions)	2022		2021		Variance		2022		2021		Variance
Interest expense, net of capitalized interest	Interest expense, net of capitalized interest	$	364	$	355	$	9	$	1,088	$	1,174	$	(86)		Interest expense, net of capitalized interest	$	354	$	364	$	(10)	$	1,060	$	1,088	$	(28)
Loss on modification or extinguishment of debt		36		171		(135)		95		215		(120)
Interest rate derivative loss, net		2		—		2		3		233		(230)
Loss (gain) on modification or extinguishment of debt															Loss (gain) on modification or extinguishment of debt	(3)		36		(39)		43		95		(52)
Derivative loss (gain), net															Derivative loss (gain), net	—		2		(2)		(2)		3		(5)
Other expense, net	Other expense, net	24		129		(105)		14		115		(101)			Other expense, net	29		24		5		21		14		7
Total other expense	Total other expense	$	426	$	655	$	(229)	$	1,200	$	1,737	$	(537)		Total other expense	$	380	$	426	$	(46)	$	1,122	$	1,200	$	(78)

Total interest expense, net of capitalized interest consisted of the following (in millions):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Total interest cost	$	376	$	398	$	1,118	$	1,216
Capitalized interest	(22)		(34)		(58)		(128)
Total interest expense, net of capitalized interest	$	354	$	364	$	1,060	$	1,088

Interest expense, net of capitalized interest, ~~increased~~decreased during the three months ended September 30, 2021 from the comparable 2020 period primarily due to the completion of construction of the final Train of the CCL Project in March 2021, which eliminated the portion of total interest costs that was eligible for capitalization. Interest expense, net of capitalized interest, decreased during theand nine months ended September 30, ~~2021~~2022 from the comparable ~~2020 period~~2021 periods as a result of lower interest costs ~~as a result of~~due to refinancing higher cost debt and repayment of debt in accordance with our capital allocation plan, ~~partially~~which was offset by ~~the~~a lower portion of total interest costs ~~that was~~ eligible for capitalization. During the three months ended September 30, 2021 and 2020, we incurred $398 million and $416 million of total interest cost, respectively, of which we capitalized $34 million and $61 million, respectively, which was primarilycapitalization related to ~~interest costs incurred for~~ the ~~construction~~Corpus Christi Stage 3 Project in 2022 as compared to Train 3 of the ~~Liquefaction Projects. During the nine months ended September 30, 2021~~CCL Project and 2020, we incurred $1,216 million and $1,356 million of total interest cost, respectively, of which we capitalized $128 million and $182 million, respectively, which was primarily related to interest costs incurred for the constructionTrain 6 of the ~~Liquefaction Projects.~~SPL Project in 2021.

~~Loss~~We had favorable variances on our loss (gain) on modification or extinguishment of debt ~~decreased~~ during the three and nine months ended September 30, ~~2021~~2022 from the ~~respective~~ comparable periods in ~~2020~~2021, respectively, primarily due to ~~a lower~~the pricing of debt that was repurchased or repaid and the amount of ~~senior notes and convertible notes repaid or redeemed between the periods, as well as a lower amount of borrowings prepaid under our credit facilities,~~debt that was paid down prior to their scheduled maturities, as further described in Liquidity and Capital ~~Resources~~—Resources—Sources and Uses of ~~Cash—Proceeds from Issuance~~s of ~~Debt, Repayments of Debt, Debt Issuance and Other~~ Cash—Financing ~~Costs and Debt Modification or Extinguishment Costs~~Cash Flows.

Interest rate derivative loss, net decreased during the nine months ended September 30, 2021 compared to the comparable 2020 period, primarily due to a favorable shift in the long-term forward LIBOR curve between the periods and the settlement of certain outstanding derivatives in August 2020 that were in an unfavorable position.

Other expense, net ~~decreased~~increased during the three and nine months ended September 30, 2022 from the comparable 2021 ~~compared to the three and nine months ended September 30, 2020~~periods primarily due to ~~lower~~increased other-than-temporary impairment losses related to our investment in Midship Holdings that ~~were~~was recognized between the ~~periods.~~periods, which was partially offset by higher interest income earned on cash and cash equivalents from higher interest rates in 2022.

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Income tax benefit


	Three Months Ended September 30,									Nine Months Ended September 30,
(in millions)	2022			2021			Variance			2022			2021			Variance
Loss before income taxes and non-controlling interest	$	(3,396)		$	(2,776)		$	(620)		$	(3,274)		$	(2,340)		$	(934)
Income tax benefit	(752)			(1,860)			1,108			(762)			(1,864)			1,102
Effective tax rate	22.1		%	67.0		%	(44.9)		%	23.3		%	79.7		%	(56.4)		%

~~Income~~Utilizing the year-to-date effective tax ~~provision (benefit)~~

Three Months Ended September 30, Nine Months Ended September 30,
(in millions) 2021 2020 Change 2021 2020 Change
Income (loss) before income taxes and non-controlling interest $ (2,776) $ (583) $ (2,193) $ (2,340) $ 618 $ (2,958)
Income tax provision (benefit) (1,860) (75) (1,785) (1,864) 119 (1,983)
Effective tax rate 67.0 % 12.9 % 79.7 % 19.3 %
rate method, our effective tax rate for the three and nine months ended September 30, 2022 was 22.1% and 23.3%, respectively. The effective tax rate for the three and nine months ended September 30, 2022 represents a tax benefit on pre-tax loss and was higher than the statutory rate primarily due to our projected foreign derived intangible income (“FDII”) deduction, which results in income from our sales to foreign customers being taxed at a lower effective tax rate.

~~The~~We used the annual effective tax ~~rates~~rate method to calculate our income tax benefit for the three and nine months ended September 30, 2021, ~~were~~which was 67.0% and 79.7%, ~~respectively. Our~~respectively, as it was determined that the annual effective tax rate ~~is based on income (loss) before income taxes and non-controlling interest and is significantly impacted by non-controlling interest that is not taxable to Cheniere. Our~~method would produce a reliable estimate. The effective tax rate ~~experienced volatility during~~for the three and nine months ended September 30, 2021 did not bear a customary relationship to the statutory income tax rate due to variability in our earnings due to pre-tax derivative losses arising from changes in fair value from our IPM agreements and the portion of our earnings attributable to non-controlling interest.

Our effective tax rate is subject to variation prospectively due to variability in our pre-tax and taxable earnings and the proportion of such earnings attributable to non-controlling ~~interest. The variability in earnings in the three and nine months ended September 30, 2021 were mainly the result of approximately $3.5 billionand $4.2 billion, respectively, of pre-tax derivative losses, primarily on our commodity derivatives as a result of unfavorable shifts in international forward commodity curves.~~

Net income (loss) attributable to non-controlling interest


		Three Months Ended September 30,						Nine Months Ended September 30,						Three Months Ended September 30,				Nine Months Ended September 30,
(in millions)	(in millions)	2021		2020		Change		2021		2020		Change			(in millions)	2022		2021		Variance		2022		2021		Variance
Net income (loss) attributable to non-controlling interest	Net income (loss) attributable to non-controlling interest	$	168	$	(45)	$	213	$	544	$	390	$	154		Net income (loss) attributable to non-controlling interest	$	(259)	$	168	$	(427)	$	(3)	$	544	$	(547)

Net ~~income~~loss attributable to non-controlling interest ~~increased~~was $259 million and $3 million during the three and nine months ended September 30, 2022, respectively, compared to net income of $168 million and $544 million during the three and nine months ended September 30, 2021, ~~from~~respectively. The changes in both the three and nine month comparable periods were primarily due to a decrease in consolidated net income recognized by CQP, which recognized net income of $381 million and $1,123 million in the three and nine months ended September 30, ~~2020 primarily due~~2021, respectively, compared to ~~an increase in consolidated net income recognized by Cheniere Partners, which increased from a~~ net loss of ~~$67~~$514 million and $13 million in the three and nine months ended September 30, ~~2020 to net income of $381 million in the three months ended September 30, 2021 and increased from net income of $774 million in~~2022, respectively.

During the nine months ended September 30, ~~2020~~2022, in fulfillment of a prior commitment to ~~$1,123~~collateralize financing for Train 6 of the SPL Project, Cheniere provided to SPL certain SPAs aggregating approximately 21 million tonnes of LNG to be delivered between 2023 and 2035 and an IPM agreement to purchase 140,000 MMBtu per day of natural gas for a term of approximately 15 years beginning in early 2023. Additionally, during the nine months ended September 30, ~~2021.~~2022, SPL executed an SPA with a counterparty aggregating approximately 1.0 mtpa of LNG to be delivered between 2026 and 2042. As a result, net income attributable to non-controlling interest will be impacted in future periods as volumes are delivered under the aforementioned contracts and by gains and losses from changes in the fair value of the IPM agreement, which is accounted for as a derivative.

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Liquidity and Capital Resources

~~Although results are consolidated for financial reporting, SPL, Cheniere Partners, CCH Group~~The following information describes our ability to generate and ~~Cheniere operate with independent capital structures. Our capital~~obtain adequate amounts of cash to meet our requirements ~~include capital~~in the short term and ~~investment expenditures, repayment of long-term debt and repurchase of~~the long term. In the short term, we expect to meet our ~~shares. We expect the~~ cash ~~needs for at least the next twelve months will be met for each of these independent capital structures as follows:~~

•~~SPL through~~requirements using operating cash flows ~~project debt~~ and ~~borrowings~~available liquidity, consisting of cash and ~~equity contributions from Cheniere Partners;~~

•~~Cheniere Partners through~~cash equivalents, restricted cash and cash equivalents and available commitments under our credit facilities. In the long term, we expect to meet our cash requirements using operating cash flows ~~from SPLNG, SPL~~ and ~~CTPL, debt or equity offerings and borrowings;~~

•~~CCH Group through operating cash flows from CCL and CCP, project debt and borrowings and equity contributions from Cheniere; and~~

•~~Cheniere through existing unrestricted cash,~~other future potential sources of liquidity, which may include debt and equity offerings by us or our ~~subsidiaries, operating cash flows, borrowings, services fees from our subsidiaries and distributions from our investment in Cheniere Partners.~~

subsidiaries. The ~~following~~ table below provides a summary of our available liquidity ~~position at September 30, 2021 and December 31, 2020~~ (in millions):.

September 30, December 31,
2021 2020
Cash and cash equivalents (1) $ 2,203 $ 1,628
Restricted cash designated for the following purposes:
SPL Project 133 97
CCL Project 59 70
Other 227 282
Available commitments under the following credit facilities:
$1.2 billion Working Capital Revolving Credit and Letter of Credit Reimbursement Agreement (the “2020 SPL Working Capital Facility”) 804 787
CQP Credit Facilities executed in 2019 (“2019 CQP Credit Facilities”) 750 750
$1.2 billion CCH Working Capital Facility (“CCH Working Capital Facility”) 840 767
Cheniere Revolving Credit Facility 1,250 1,126
Cheniere Term Loan Facility — 372


	September 30, 2022
Cash and cash equivalents (1)	$	2,504
Restricted cash and cash equivalents designated for the following purposes:

SPL Project	195


CCL Project	202
Cash held by our subsidiaries that is restricted to Cheniere	437
Total restricted cash and cash equivalents	834
Available commitments under our credit facilities (2):

SPL’s Working capital revolving credit and letter of credit reimbursement agreement	837
CQP’s Credit facilities	750

CCH Credit Facility	3,260
CCH Working Capital Facility	1,282
Revolving Credit Facility (the “Cheniere Revolving Credit Facility”)	1,250

Total available commitments under our credit facilities	7,379

Total available liquidity	$	10,717

(1)Amounts presented include balances held by our consolidated variable interest entity, ~~Cheniere Partners,~~CQP, as discussed in Note 7 —7—Non-controlling Interest and Variable Interest Entity of our Notes to Consolidated Financial Statements. As of ~~both~~ September 30, ~~2021 and December 31, 2020,~~2022, assets of ~~Cheniere Partners,~~CQP, which are included in our Consolidated Balance Sheets, included ~~$1.7~~$1.0 billion of cash and cash equivalents.

(2)Available commitments represent total commitments less loans outstanding and letters of credit issued under each of our credit facilities as of September 30, 2022. See Note 9—Debt of our Notes to Consolidated Financial Statements for additional information on our credit facilities and other debt instruments.

Our liquidity position subsequent to September 30, 2022 will be driven by future sources of liquidity and future cash requirements. Future sources of liquidity are expected to be composed of (1) cash receipts from executed contracts, under which we are contractually entitled to future consideration, and (2) additional sources of liquidity, from which we expect to receive cash although the cash is not underpinned by executed contracts. Future cash requirements are expected to be composed of (1) cash payments under executed contracts, under which we are contractually obligated to make payments, and (2) additional cash requirements, under which we expect to make payments although we are not contractually obligated to make the payments under executed contracts.

Although our sources and uses of cash are presented below from a consolidated standpoint, SPL, CQP, CCH and Cheniere operate with independent capital structures. Certain restrictions under debt and equity instruments executed by our subsidiaries limit each entity’s ability to distribute cash, including the following:

•SPL and CCH are required to deposit all cash received into restricted cash and cash equivalents accounts under certain of their debt agreements. The usage or withdrawal of such cash is restricted to the payment of liabilities related to the Liquefaction Projects and other restricted payments. The majority of the cash held by SPL and CCH that is restricted to Cheniere relates to advance funding for operation and construction of the Liquefaction Projects;

•CQP is required under its partnership agreement to distribute to unitholders all available cash on hand at the end of a quarter less the amount of any reserves established by its general partner. Beginning with the distribution paid in the second quarter of 2022, quarterly distributions by CQP are comprised of a base amount plus a variable amount equal to the remaining available cash per unit, which takes into consideration, among other things, amounts reserved for annual debt repayment and capital allocation goals, anticipated capital expenditures to be funded with cash, and cash reserves to provide for the proper conduct of CQP’s business.

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~~Sabine Pass LNG Terminal~~•Our 48.6% limited partner interest, 100% general partner interest and incentive distribution rights in CQP limit our right to receive cash held by CQP to the amounts specified by the provisions of CQP’s partnership agreement; and

•SPL, CQP and CCH are restricted by affirmative and negative covenants included in certain of their debt agreements in their ability to make certain payments, including distributions, unless specific requirements are satisfied.

~~Liquefaction Facilities~~

~~The SPL Project is one of~~Notwithstanding the ~~largest LNG production facilities in the world. Through Cheniere Partners,~~restrictions noted above, we are currently operating five Trains and two marine berths at the SPL Project, undergoing commissioning of one additional Train that is expected to be substantially completed in the first quarter of 2022 and constructing a third marine berth. We have achieved substantial completion of the first five Trains of the SPL Project and commenced commercial operating activities for each Train at various times starting in May 2016. The following table summarizes the project completion and construction status of Train 6 of the SPL Project as of September 30, 2021:


						~~SPL Train 6~~
~~Overall project completion percentage~~						~~97.1%~~
~~Completion percentage of:~~
~~Engineering~~						~~100.0%~~
~~Procurement~~						~~100.0%~~
~~Subcontract work~~						~~95.8%~~
~~Construction~~						~~92.9%~~
~~Date of expected substantial completion~~						~~1Q 2022~~

We received approval from FERC to site, construct and operate up to a combined total equivalent of approximately 1,661.94 Bcf/yr (approximately 33 mtpa) of natural gas from the SPL Project. The DOE has has issued multiple orders authorizing the export of domestically produced LNG by vessel from the Sabine Pass LNG terminal through December 31, 2050 to FTA countries and non-FTA countries for 1,509.3 Bcf/yr (approximately 30 mtpa) of natural gas, and an additional 152.64 Bcf/yr (approximately 3 mtpa) of natural gas to FTA countries only, with the authorization for the additional volume to non-FTA countries pending.

In December 2020, the DOE announced a new policy in which it would no longer issue short-term export authorizations separately from long-term authorizations. Accordingly, the DOE amended each of SPL’s long-term authorizations to include short-term export authority, and vacated the short-term orders.

~~Customers~~

SPL has entered into fixed price long-term SPAs with third-parties, generally with terms of 20 years (plus extension rights) and with a weighted average remaining contract length of approximately 16 years (plus extension rights) for Trains 1 through 6 of the SPL Project. Under these SPAs, the customers will purchase LNG from SPL for a price consisting of a fixed fee per MMBtu of LNG (a portion of which is subject to annual adjustment for inflation) plus a variable fee per MMBtu of LNG generally equal to approximately 115% of Henry Hub. The customers may elect to cancel or suspend deliveries of LNG cargoes, with advance notice as governed by each respective SPA, in which case the customers would still be required to pay the fixed fee with respect to the contracted volumes that are not delivered as a result of such cancellation or suspension. We refer to the fee component that is applicable regardless of a cancellation or suspension of LNG cargo deliveries under the SPAs as the fixed fee component of the price under SPL’s SPAs. We refer to the fee component that is applicable only in connection with LNG cargo deliveries as the variable fee component of the price under SPL’s SPAs. The variable fees under SPL’s SPAs were generally sized at the time of entry into each SPA with the intent to cover the costs of gas purchases and transportation and liquefaction fuel to produce the LNG to be sold under each such SPA. The SPAs and contracted volumes to be made available under the SPAs are not tied to a specific Train; however, the term of each SPA generally commences upon the date of first commercial delivery of a specified Train.

In aggregate, the annual fixed fee portion to be paid by the third-party SPA customers is approximately $2.9 billion for Trains 1 through 5. After giving effect to an SPA that Cheniere has committed to provide to SPL and upon the date of first commercial delivery of Train 6, the annual fixed fee portion to be paid by the third-party SPA customers is expected to increase to at least $3.3 billion.

~~In addition, Cheniere Marketing has an agreement with SPL to purchase, at Cheniere Marketing’s option, any LNG produced by SPL in excess of that required for other customers. See~~ ~~Marketing~~ ~~section for additional information regarding agreements entered into by Cheniere Marketing.~~

~~Natural Gas Transportation, Storage and Supply~~

To ensure SPL is able to transport adequate natural gas feedstock to the Sabine Pass LNG terminal, it has entered into transportation precedent and other agreements to secure firm pipeline transportation capacity with CTPL and third-party pipeline companies. SPL has entered into firm storage services agreements with third parties to assist in managing variability in natural gas needs for the SPL Project. SPL has also entered into enabling agreements and long-term natural gas supply contracts with third parties in order to secure natural gas feedstock for the SPL Project. As of September 30, 2021, SPL had secured up to approximately 5,033 TBtu of natural gas feedstock through long-term and short-term natural gas supply contracts with remaining terms that range up to 10 years, a portion of which is subject to conditions precedent.

~~Construction~~

SPL entered into lump sum turnkey contracts with Bechtel Oil, Gas and Chemicals, Inc. (“Bechtel”) for the engineering, procurement and construction of Trains 1 through 6 of the SPL Project, under which Bechtel charges a lump sum for all work performed and generally bears project cost, schedule and performance risks unless certain specified events occur, in which case Bechtel may cause SPL to enter into a change order, or SPL agrees with Bechtel to a change order.

The total contract price of the EPC contract for Train 6 of the SPL Project is approximately $2.5 billion, including estimated costs for the third marine berth that is currently under construction. As of September 30, 2021, we have incurred $2.2 billion under this contract.

~~Regasification Facilities~~

The Sabine Pass LNG terminal has operational regasification capacity of approximately 4 Bcf/d and aggregate LNG storage capacity of approximately 17 Bcfe. Approximately 2 Bcf/d of the regasification capacity at the Sabine Pass LNG terminal has been reserved under two long-term third-party TUAs, under which SPLNG’s customers are required to pay fixed monthly fees, whether or not they use the LNG terminal. Each of TotalEnergies Gas & Power North America, Inc. (“Total”) and Chevron U.S.A. Inc. (“Chevron”) has reserved approximately 1 Bcf/d of regasification capacity and is obligated to make monthly capacity payments to SPLNG aggregating approximately $125 million annually, prior to inflation adjustments, for 20 years that commenced in 2009. Total S.A. has guaranteed Total’s obligations under its TUA up to $2.5 billion, subject to certain exceptions, and Chevron Corporation has guaranteed Chevron’s obligations under its TUA up to 80% of the fees payable by Chevron.

The remaining approximately 2 Bcf/d of capacity has been reserved under a TUA by SPL. SPL is obligated to make monthly capacity payments to SPLNG aggregating approximately $250 million annually, prior to inflation adjustments, continuing until at least May 2036. SPL entered into a partial TUA assignment agreement with Total, whereby upon substantial completion of Train 5 of the SPL Project, SPL gained access to substantially all of Total’s capacity and other services provided under Total’s TUA with SPLNG. This agreement provides SPL with additional berthing and storage capacity at the Sabine Pass LNG terminal that may be used to provide increased flexibility in managing LNG cargo loading and unloading activity, permit SPL to more flexibly manage its LNG storage capacity and accommodate the development of Train 6. Notwithstanding any arrangements between Total and SPL, payments required to be made by Total to SPLNG will continue to be made by Total to SPLNG in accordance with its TUA. During each of the three months ended September 30, 2021 and 2020, SPL recorded $32 million as operating and maintenance expense under this partial TUA assignment agreement. During each of the nine months ended September 30, 2021 and 2020, SPL recorded $97 million, as operating and maintenance expense under this partial TUA assignment agreement.

~~Under each of these TUAs, SPLNG is entitled to retain 2% of the LNG delivered to the Sabine Pass LNG terminal.~~

~~Capital Resources~~

We currently expect that SPL’s capital resources requirements with respect to the SPL Project will be financed through cash flows under the SPAs, project debt and borrowings and equity contributions from Cheniere Partners. We believe that ~~with~~sufficient flexibility exists within the ~~net proceeds of borrowings, available commitments under the 2020 SPL Working Capital Facility and 2019 CQP Credit Facilities, cash flows from operations and equity contributions from~~ Cheniere ~~Partners~~, ~~SPL will have adequate financial resources available~~complex to enable each independent capital structure to meet its currently anticipated ~~capital, operating~~cash requirements. The sources of liquidity at SPL, CQP and ~~debt service~~CCH primarily fund the cash requirements ~~with respect to Trains 1 through 6~~ of the ~~SPL Project. Additionally, SPLNG generates~~respective entity, and any remaining liquidity not subject to restriction, as supplemented by liquidity provided by Cheniere Marketing, is available to enable Cheniere to meet its cash ~~flows from the TUAs, as discussed above.~~

The following table provides a summary of our capital resources from borrowings and available commitments for the Sabine Pass LNG terminal, excluding equity contributions to our subsidiaries and cash flows from operations (as described in ~~Sources and Uses of Cash), at September 30, 2021 and December 31, 2020 (in millions):~~

September 30, December 31,
2021 2020
Senior notes (1) $ 18,278 $ 17,750
Letters of credit issued (2) 396 413
Available commitments under credit facilities (2) 1,554 1,537
Total capital resources from borrowings and available commitments (3) $ 20,228 $ 19,700

~~(1)~~Includes SPL’s 4.200% to 6.25% senior secured notes due between March 2022 and September 2037 (collectively, the “SPL Senior Notes”), as well as Cheniere Partners’ 3.250% to 5.625% senior notes due between October 2025 and January 2032 (collectively, the “CQP Senior Notes”).

~~(2)Consists of 2020 SPL Working Capital Facility and 2019 CQP Credit Facilities.~~

~~(3)Does not include equity contributions that may be available from Cheniere’s borrowings and available cash and cash equivalents.~~requirements.

~~SPL Senior Notes~~

The SPL Senior Notes are governed by a common indenture (the “SPL Indenture”) and the terms of the 5.00% Senior Secured Notes due 2037 (the “2037 SPL Senior Notes”) are governed by a separate indenture (the “2037 SPL Senior Notes Indenture”). Both the SPL Indenture and the 2037 SPL Senior Notes Indenture contain terms and events of default and certain covenants that, among other things, limit SPL’s ability and the ability of SPL’s restricted subsidiaries to incur additional indebtedness or issue preferred stock, make certain investments or pay dividends or distributions on capital stock or subordinated indebtedness or purchase, redeem or retire capital stock, sell or transfer assets, including capital stock of SPL’s restricted subsidiaries, restrict dividends or other payments by restricted subsidiaries, incur liens, enter into transactions with affiliates, dissolve, liquidate, consolidate, merge, sell or lease all or substantially all of SPL’s assets and enter into certain LNG sales contracts. Subject to permitted liens, the SPL Senior Notes are secured on a ~~pari passu~~ first-priority basis by a security interest in all of the membership interests in SPL and substantially all of SPL’s assets. SPL may not make any distributions until, among other requirements, deposits are made into debt service reserve accounts as required and a debt service coverage ratio test of 1.25:1.00 is satisfied.

At any time prior to six months before the respective dates of maturity for each series of the SPL Senior Notes (except for the 2022 SPL Senior Notes, 5.625% Senior Secured Notes due 2023 (the “2023 SPL Senior Notes”), 5.75% Senior Secured Notes due 2024 (the “2024 SPL Senior Notes”) and 5.625% Senior Notes due 2025 (the “2025 SPL Senior Notes”), in which case the time period is three months before the respective dates of maturity), SPL may redeem all or part of such series of the SPL Senior Notes at a redemption price equal to the ‘make-whole’ price (except for the 2037 SPL Senior Notes, in which case the redemption price is equal to the “optional redemption” price) set forth in the respective indentures governing the SPL Senior Notes, plus accrued and unpaid interest, if any, to the date of redemption. SPL may also, at any time within six months of the respective maturity dates for each series of the SPL Senior Notes (except for the 2022 SPL Senior Notes, 2023 SPL Senior Notes, 2024 SPL Senior Notes and 2025 SPL Senior Notes, in which case the time period is within three months of the respective dates of maturity), redeem all or part of such series of the SPL Senior Notes at a redemption price equal to 100% of the principal amount of such series of the SPL Senior Notes to be redeemed, plus accrued and unpaid interest, if any, to the date of redemption.

SPL may incur additional indebtedness in the future, including by issuing additional notes, and such indebtedness could be at higher interest rates and have different maturity dates and more restrictive covenants than the current outstanding indebtedness of SPL, including the SPL Senior Notes and the 2020 SPL Working Capital Facility. Semi-annual principal payments for the 2037 SPL Senior Notes are due on March 15 and September 15 of each year beginning September 15, 2025 and are fully amortizing according to a fixed sculpted amortization schedule.

During 2021, SPL entered into a series of note purchase agreements for the sale of approximately $482 million aggregate principal amount of the 2037 SPL Private Placement Senior Secured Notes on a private placement basis. The 2037 SPL Private Placement Senior Secured Notes are expected to be issued in the fourth quarter of 2021, subject to customary closing conditions, and the net proceeds will be used to strategically refinance a portion of the 2022 SPL Senior Notes and pay related

~~fees, costs and expenses. The 2037 SPL Private Placement Senior Secured Notes will be fully amortizing, with a weighted average life of over 10 years and a weighted average interest rate of 3.07%.~~

~~2020 SPL Working Capital Facility~~

In March 2020, SPL entered into the 2020 SPL Working Capital Facility with aggregate commitments of $1.2 billion, which replaced the $1.2 billion Amended and Restated SPL Working Capital Facility (the “2015 SPL Working Capital Facility”). The 2020 SPL Working Capital Facility is intended to be used for loans to SPL, swing line loans to SPL and the issuance of letters of credit on behalf of SPL, primarily for (1) the refinancing of the 2015 SPL Working Capital Facility, (2) fees and expenses related to the 2020 SPL Working Capital Facility, (3) SPL and its future subsidiaries’ gas purchase obligations and (4) SPL and certain of its future subsidiaries’ general corporate purposes. SPL may, from time to time, request increases in the commitments under the 2020 SPL Working Capital Facility of up to $800 million. As of September 30, 2021 and December 31, 2020, SPL had $804 million and $787 million of available commitments and $396 million and $413 million aggregate amount of issued letters of credit, respectively. As of both September 30, 2021 and December 31, 2020, SPL had no outstanding borrowings under the 2020 SPL Working Capital Facility.

The 2020 SPL Working Capital Facility matures on March 19, 2025, but may be extended with consent of the lenders. The 2020 SPL Working Capital Facility provides for mandatory prepayments under customary circumstances.

The 2020 SPL Working Capital Facility contains customary conditions precedent for extensions of credit, as well as customary affirmative and negative covenants. SPL is restricted from making certain distributions under agreements governing its indebtedness generally until, among other requirements, satisfaction of a 12-month forward-looking and backward-looking 1.25:1.00 debt service reserve ratio test. The obligations of SPL under the 2020 SPL Working Capital Facility are secured by substantially all of the assets of SPL as well as a pledge of all of the membership interests in SPL and certain future subsidiaries of SPL on a ~~pari passu~~ ~~basis by a first priority lien with the SPL Senior Notes.~~

~~Cheniere Partners~~

~~CQP Senior Notes~~

The CQP Senior Notes are jointly and severally guaranteed by each of Cheniere Partners’ subsidiaries other than SPL and, subject to certain conditions governing its guarantee, Sabine Pass LP (each a “Guarantor” and collectively, the “CQP Guarantors”). The CQP Senior Notes are governed by the same base indenture (the “CQP Base Indenture”). The 4.500% Senior Notes due 2029 (the “2029 CQP Senior Notes”) are further governed by the Third Supplemental Indenture, the 2031 CQP Senior Notes are further governed by the Fifth Supplemental Indenture and the 2032 CQP Senior Notes are further governed by the Sixth Supplemental Indenture. The indentures governing the CQP Senior Notes contain terms and events of default and certain covenants that, among other things, limit the ability of Cheniere Partners and the CQP Guarantors to incur liens and sell assets, enter into transactions with affiliates, enter into sale-leaseback transactions and consolidate, merge or sell, lease or otherwise dispose of all or substantially all of the applicable entity’s properties or assets.

At any time prior to October 1, 2024 for the 2029 CQP Senior Notes, March 1, 2026 for the 2031 CQP Senior Notes and January 31, 2027 for the 2032 CQP Senior Notes, Cheniere Partners may redeem all or a part of the applicable CQP Senior Notes at a redemption price equal to 100% of the aggregate principal amount of the CQP Senior Notes redeemed, plus the “applicable premium” set forth in the respective indentures governing the CQP Senior Notes, plus accrued and unpaid interest, if any, to the date of redemption. In addition, at any time prior to October 1, 2024 for the 2029 CQP Senior Notes, March 1, 2024 for the 2031 CQP Senior Notes and January 31, 2025 for the 2032 CQP Senior Notes, Cheniere Partners may redeem up to 35%, and in the case of the 2032 CQP Senior Notes, up to 40%, of the aggregate principal amount of the CQP Senior Notes with an amount of cash not greater than the net cash proceeds from certain equity offerings at a redemption price equal to 104.5% of the aggregate principal amount of the 2029 CQP Senior Notes, 104.000% of the aggregate principal amount of the 2031 CQP Senior Notes and 103.250% of the aggregate principal amount of the 2032 CQP Senior Notes redeemed, plus accrued and unpaid interest, if any, to the date of redemption. Cheniere Partners also may at any time on or after October 1, 2024 through the maturity date of October 1, 2029 for the 2029 CQP Senior Notes, March 1, 2026 through the maturity date of March 1, 2031 for the 2031 CQP Senior Notes and January 31, 2027 through maturity date of January 31, 2032 for the 2032 CQP Senior Notes, redeem the CQP Senior Notes, in whole or in part, at the redemption prices set forth in the respective indentures governing the CQP Senior Notes.

The CQP Senior Notes are Cheniere Partners’ senior obligations, ranking equally in right of payment with Cheniere Partners’ other existing and future unsubordinated debt and senior to any of its future subordinated debt. In the event that the aggregate amount of Cheniere Partners’ secured indebtedness and the secured indebtedness of the CQP Guarantors (other than the CQP Senior Notes or any other series of notes issued under the CQP Base Indenture) outstanding at any one time exceeds the greater of (1) $1.5 billion and (2) 10% of net tangible assets, the CQP Senior Notes will be secured to the same extent as such obligations under the 2019 CQP Credit Facilities. The obligations under the 2019 CQP Credit Facilities are secured on a first-priority basis (subject to permitted encumbrances) with liens on substantially all the existing and future tangible and intangible assets and rights of Cheniere Partners and the CQP Guarantors and equity interests in the CQP Guarantors (except, in each case, for certain excluded properties set forth in the 2019 CQP Credit Facilities). The liens securing the CQP Senior Notes, if applicable, will be shared equally and ratably (subject to permitted liens) with the holders of other senior secured obligations, which include the 2019 CQP Credit Facilities obligations and any future additional senior secured debt obligations.

~~2019 CQP Credit Facilities~~

Cheniere Partners has a $750 million revolving credit facility under the 2019 CQP Credit Facilities. Borrowings under the 2019 CQP Credit Facilities are being used to fund the development and construction of Train 6 of the SPL Project and for general corporate purposes, subject to a sublimit, and the 2019 CQP Credit Facilities are also available for the issuance of letters of credit. As of both September 30, 2021 and December 31, 2020, Cheniere Partners had $750 million of available commitments and no letters of credit issued or loans outstanding under the 2019 CQP Credit Facilities.

The 2019 CQP Credit Facilities mature on May 29, 2024. Any outstanding balance may be repaid, in whole or in part, at any time without premium or penalty, except for interest rate breakage costs. The 2019 CQP Credit Facilities contain conditions precedent for extensions of credit, as well as customary affirmative and negative covenants, and limit Cheniere Partners’ ability to make restricted payments, including distributions, to once per fiscal quarter and one true-up per fiscal quarter as long as certain conditions are satisfied.

The 2019 CQP Credit Facilities are unconditionally guaranteed and secured by a first priority lien (subject to permitted encumbrances) on substantially all of Cheniere Partners’ and the CQP Guarantors’ existing and future tangible and intangible assets and rights and equity interests in the CQP Guarantors (except, in each case, for certain excluded properties set forth in the 2019 CQP Credit Facilities).

~~Corpus Christi LNG Terminal~~

~~Liquefaction Facilities~~

We are currently operating three Trains and two marine berths at the CCL Project. We completed construction of Trains 1, 2 and 3 of the CCL Project and commenced commercial operating activities in February 2019, August 2019 and March 2021, respectively. We received approval from FERC to site, construct and operate up to a combined total equivalent of approximately 875.16 Bcf/yr (approximately 17 mtpa) of natural gas from the CCL Project.

Separate from the CCH Group, we are also developing Corpus Christi Stage 3 through our subsidiary CCL Stage III, adjacent to the CCL Project. We received approval from FERC in November 2019 to site, construct and operate seven midscale Trains with an expected total production capacity of up to approximately 11.45 mtpa of LNG.

~~The following orders have been issued by the DOE authorizing the export of domestically produced LNG by vessel from the Corpus Christi LNG terminal:~~

•CCL Project—FTA countries and non-FTA countries through December 31, 2050, up to a combined total equivalent of approximately 767 Bcf/yr (approximately 15 mtpa) of natural gas, and an additional 108.16 Bcf/yr (approximately 2 mtpa) to FTA countries only, with the authorization for the additional volume to non-FTA countries pending.

•~~Corpus Christi Stage 3—FTA countries and non-FTA countries through December 31, 2050 in an amount equivalent to approximately 582.14 Bcf/yr (approximately 11 mtpa) of natural gas.~~

In December 2020, the DOE announced a new policy in which it would no longer issue short-term export authorizations separately from long-term authorizations. Accordingly, the DOE amended each of CCL’s long-term authorizations to include short-term export authority, and vacated the short-term orders.

~~Customers~~

CCL has entered into fixed price long-term SPAs with third-parties, generally with terms of 20 years (plus extension rights) and with a weighted average remaining contract length of approximately 18 years (plus extension rights) for Trains 1 through 3 of the CCL Project. Under these SPAs, the customers will purchase LNG from CCL on a free on board (“FOB”) basis for a price consisting of a fixed fee per MMBtu of LNG (a portion of which is subject to annual adjustment for inflation) plus a variable fee per MMBtu of LNG equal to approximately 115% of Henry Hub. The customers may elect to cancel or suspend deliveries of LNG cargoes, with advance notice as governed by each respective SPA, in which case the customers would still be required to pay the fixed fee with respect to the contracted volumes that are not delivered as a result of such cancellation or suspension. We refer to the fee component that is applicable regardless of a cancellation or suspension of LNG cargo deliveries under the SPAs as the fixed fee component of the price under our SPAs. We refer to the fee component that is applicable only in connection with LNG cargo deliveries as the variable fee component of the price under our SPAs. The variable fee under CCL’s SPAs entered into in connection with the development of the CCL Project was sized at the time of entry into each SPA with the intent to cover the costs of gas purchases and transportation and liquefaction fuel to produce the LNG to be sold under each such SPA. The SPAs and contracted volumes to be made available under the SPAs are not tied to a specific Train; however, the term of each SPA generally commences upon the date of first commercial delivery for the applicable Train, as specified in each SPA.

~~In aggregate, the minimum annual fixed fee portion to be paid by the third-party SPA customers is approximately $1.8 billion for Trains 1 through 3.~~

In addition, Cheniere Marketing has agreements with CCL to purchase: (1) approximately 15 TBtu per annum of LNG with a term through 2043, (2) any LNG produced by CCL in excess of that required for other customers at Cheniere Marketing’s option and (3) approximately 44 TBtu of LNG with a maximum term up to 2026 associated with the IPM gas supply agreement between CCL and EOG Resources, Inc. See ~~Marketing~~ ~~section for additional information regarding agreements entered into by Cheniere Marketing.~~

~~Natural Gas Transportation, Storage and Supply~~

To ensure CCL is able to transport adequate natural gas feedstock to the Corpus Christi LNG terminal, it has entered into transportation precedent agreements to secure firm pipeline transportation capacity with CCP and certain third-party pipeline companies. CCL has entered into a firm storage services agreement with a third party to assist in managing variability in natural gas needs for the CCL Project. CCL has also entered into enabling agreements and long-term natural gas supply contracts with third parties, and will continue to enter into such agreements, in order to secure natural gas feedstock for the CCL Project. As of September 30, 2021, CCL had secured up to approximately 2,798 TBtu of natural gas feedstock through long-term natural gas supply contracts with remaining terms that range up to 10 years, a portion of which is subject to the achievement of certain project milestones and other conditions precedent.

CCL Stage III has also entered into long-term natural gas supply contracts with third parties, and anticipates continuing to enter into such agreements, in order to secure natural gas feedstock for Corpus Christi Stage 3. As of September 30, 2021, CCL Stage III had secured up to approximately 3,128 TBtu of natural gas feedstock through long-term natural gas supply contracts with remaining terms that range up to approximately 15 years, which is subject to the achievement of certain project milestones and other conditions precedent.

A portion of the natural gas feedstock transactions for CCL and CCL Stage III are IPM transactions, in which the natural gas producers are paid based on a global gas market price less a fixed liquefaction fee and certain costs incurred by us.

~~Construction~~

CCL entered into separate lump sum turnkey contracts with Bechtel for the engineering, procurement and construction of Trains 1 through 3 of the CCL Project under which Bechtel charged a lump sum for all work performed and generally bore project cost, schedule and performance risks unless certain specified events occurred, in which case Bechtel may have caused CCL to enter into a change order, or CCL agreed with Bechtel to a change order.

~~Final Investment Decision for Corpus Christi Stage 3~~

FID for Corpus Christi Stage 3 will be subject to, among other things, entering into an EPC contract, obtaining additional commercial support for the project and securing the necessary financing arrangements.

~~Pipeline Facilities~~

In November 2019, the FERC authorized CCP to construct and operate the pipeline for Corpus Christi Stage 3. The pipeline will be designed to transport 1.5 Bcf/d of natural gas feedstock required by Corpus Christi Stage 3 from the existing regional natural gas pipeline grid.

~~Capital Resources~~

The following table provides a summary of the capital resources of the CCH Group from borrowings and available commitments for the CCL Project, excluding equity contributions from Cheniere, at September 30, 2021 and December 31, 2020 (in millions):

September 30, December 31,
2021 2020
Senior notes (1) $ 8,471 $ 7,721
Credit facilities outstanding balance (2) 1,761 2,767
Letters of credit issued (2) 360 293
Available commitments under credit facilities (2) 840 767
Total capital resources from borrowings and available commitments (3) $ 11,432 $ 11,548

~~(1)Includes CCH’s 2.742% to 7.000% senior secured notes due between June 2024 and December 2039 (collectively, the “CCH Senior Notes”).~~

~~(2)Includes the CCH Credit Facility and the CCH Working Capital Facility.~~

~~(3)Does not include equity contributions that may be available from Cheniere’s borrowings and available cash and cash equivalents.~~

~~CCH Senior Notes~~

The CCH Senior Notes are jointly and severally guaranteed by CCH’s subsidiaries, CCL, CCP and Corpus Christi Pipeline GP, LLC (each a “CCH Guarantor” and collectively, the “CCH Guarantors”). The indentures governing the CCH Senior Notes contain customary terms and events of default and certain covenants that, among other things, limit CCH’s ability and the ability of CCH’s restricted subsidiaries to: incur additional indebtedness or issue preferred stock; make certain investments or pay dividends or distributions on membership interests or subordinated indebtedness or purchase, redeem or retire membership interests; sell or transfer assets, including membership or partnership interests of CCH’s restricted subsidiaries; restrict dividends or other payments by restricted subsidiaries to CCH or any of CCH’s restricted subsidiaries; incur liens; enter into transactions with affiliates; dissolve, liquidate, consolidate, merge, sell or lease all or substantially all of the properties or assets of CCH and its restricted subsidiaries taken as a whole; or permit any CCH Guarantor to dissolve, liquidate, consolidate, merge, sell or lease all or substantially all of its properties and assets. The covenants included in the respective indentures that govern the CCH Senior Notes are subject to a number of important limitations and exceptions.

The CCH Senior Notes are CCH’s senior secured obligations, ranking senior in right of payment to any and all of CCH’s future indebtedness that is subordinated to the CCH Senior Notes and equal in right of payment with CCH’s other existing and future indebtedness that is senior and secured by the same collateral securing the CCH Senior Notes. The CCH Senior Notes are secured by a first-priority security interest in substantially all of CCH’s and the CCH Guarantors’ assets.

At any time prior to six months before the respective dates of maturity for each of the CCH Senior Notes, CCH may redeem all or part of such series of the CCH Senior Notes at a redemption price equal to the “make-whole” price set forth in the appropriate indenture, plus accrued and unpaid interest, if any, to the date of redemption. At any time within six months of the respective dates of maturity for each of the CCH Senior Notes, CCH may redeem all or part of such series of the CCH Senior Notes, in whole or in part, at a redemption price equal to 100% of the principal amount of the CCH Senior Notes to be redeemed, plus accrued and unpaid interest, if any, to the date of redemption.

~~CCH Credit Facility~~

CCH has total commitments under the CCH Credit Facility of $6.1 billion. The obligations of CCH under the CCH Credit Facility are secured by a first priority lien on substantially all of the assets of CCH and its subsidiaries and by a pledge by Cheniere CCH Holdco I, LLC of its limited liability company interests in CCH. As of both September 30, 2021 and December 31, 2020, CCH had no available commitments and $1.8 billion and $2.6 billion, respectively, of loans outstanding under the CCH Credit Facility.

The CCH Credit Facility matures on June 30, 2024, with principal payments due quarterly commencing on the earlier of (1) the first quarterly payment date occurring more than three calendar months following the completion of the CCL Project as defined in the common terms agreement and (2) a set date determined by reference to the date under which a certain LNG buyer linked to the last Train of the CCL Project to become operational is entitled to terminate its SPA for failure to achieve the date of first commercial delivery for that agreement. Scheduled repayments will be based upon a 19-year tailored amortization, commencing the first full quarter after the completion of Trains 1 through 3 and designed to achieve a minimum projected fixed debt service coverage ratio of 1.50:1.

Under the CCH Credit Facility, CCH is required to hedge not less than 65% of the variable interest rate exposure of its senior secured debt. CCH is restricted from making certain distributions under agreements governing its indebtedness generally until, among other requirements, the completion of the construction of Trains 1 through 3 of the CCL Project, funding of a debt service reserve account equal to six months of debt service and achieving a historical debt service coverage ratio and fixed projected debt service coverage ratio of at least 1.25:1.00.

~~CCH Working Capital Facility~~

CCH has total commitments under the CCH Working Capital Facility of $1.2 billion. The CCH Working Capital Facility is intended to be used for loans to CCH (“CCH Working Capital Loans”) and the issuance of letters of credit on behalf of CCH for certain working capital requirements related to developing and operating the CCL Project and for related business purposes. Loans under the CCH Working Capital Facility are guaranteed by the CCH Guarantors. CCH may, from time to time, request increases in the commitments under the CCH Working Capital Facility of up to the maximum allowed for working capital under the Common Terms Agreement that was entered into concurrently with the CCH Credit Facility. As of September 30, 2021 and December 31, 2020, CCH had $840 million and $767 million of available commitments, zero and $140 million of loans outstanding and $360 million and $293 million aggregate amount of issued letters of credit under the CCH Working Capital Facility as of September 30, 2021 and December 31, 2020, respectively.

The CCH Working Capital Facility matures on June 29, 2023, and CCH may prepay the CCH Working Capital Loans and loans made in connection with a draw upon any letter of credit (“CCH LC Loans”) at any time without premium or penalty upon three business days’ notice and may re-borrow at any time. CCH LC Loans have a term of up to one year. CCH is required to reduce the aggregate outstanding principal amount of all CCH Working Capital Loans to zero for a period of five consecutive business days at least once each year.

The CCH Working Capital Facility contains conditions precedent for extensions of credit, as well as customary affirmative and negative covenants. The obligations of CCH under the CCH Working Capital Facility are secured by substantially all of the assets of CCH and the CCH Guarantors as well as all of the membership interests in CCH and each of the CCH Guarantors on a ~~pari passu~~ ~~basis with the CCH Senior Notes and the CCH Credit Facility.~~

~~Cheniere~~

~~Senior Notes~~

We have an aggregate principal amount of $2.0 billion of the 4.625% Senior Secured Notes due 2028 (the “2028 Cheniere Senior Notes”), the proceeds of which were used to prepay a portion of the outstanding indebtedness under the Cheniere Term Loan Facility and to pay related fees and expenses. The associated indentures (“Cheniere Indenture”) contain customary terms and events of default and certain covenants that, among other things, limit our ability to create liens or other encumbrances, enter into sale-leaseback transactions and merge or consolidate with other entities or sell all or substantially all of our assets. The Cheniere Indenture covenants are subject to a number of important limitations and exceptions.

At any time prior to October 15, 2023, we may redeem all or a part of the 2028 Cheniere Senior Notes at a redemption price equal to 100% of the aggregate principal amount thereof, plus the “applicable premium” and accrued and unpaid interest, if any, to but not including the date of redemption. We also may, at any time prior to October 15, 2023, redeem up to 40% of the aggregate principal amount of the 2028 Cheniere Senior Notes with an amount of cash not greater than the net cash proceeds from certain equity offerings at a redemption price equal to 104.625% of the aggregate principal amount of the notes being redeemed, plus accrued and unpaid interest, if any, to but not including, the date of redemption. At any time on or after October 15, 2023 through the maturity date of October 15, 2028, we may redeem all or part of the 2028 Cheniere Senior Notes at the redemption prices described in the Cheniere Indenture.

The 2028 Cheniere Senior Notes are our general senior obligations and rank senior in right of payment to all of our future obligations that are, by their terms, expressly subordinated in right of payment to the 2028 Cheniere Senior Notes and equally in right of payment with all of our other existing and future unsubordinated indebtedness. The 2028 Cheniere Senior Notes became unsecured in June 2021 concurrent with the repayment of all outstanding obligations under the Cheniere Term Loan Facility and may, in certain instances become secured in the future in connection with the incurrence of additional secured indebtedness by us. When required, the 2028 Cheniere Senior Notes will be secured on a first-priority basis by a lien on substantially all of our assets and equity interests in our direct subsidiaries (other than certain excluded subsidiaries), which liens rank ~~pari passu~~ with the liens securing the Cheniere Revolving Credit Facility. As of September 30, 2021, the 2028 Cheniere Senior Notes are not guaranteed by any of our subsidiaries. In the future, the 2028 Cheniere Senior Notes will be guaranteed by our subsidiaries who guarantee our other material indebtedness.

~~Convertible Notes~~

We have $625 million aggregate principal amount of 4.25% Convertible Senior Notes due 2045 (the “2045 Cheniere Convertible Senior Notes”). We have the right, at our option, at any time after March 15, 2020, to redeem all or any part of the 2045 Cheniere Convertible Senior Notes at a redemption price equal to the accreted amount of the 2045 Cheniere Convertible Senior Notes to be redeemed, plus accrued and unpaid interest, if any, to such redemption date. Prior to December 15, 2044, the 2045 Cheniere Convertible Senior Notes are convertible only under certain circumstances as specified in the indenture; thereafter, holders may convert their notes regardless of these circumstances. The conversion rate will initially equal 7.2265 shares of our common stock per $1,000 principal amount of the 2045 Cheniere Convertible Senior Notes, which corresponds to an initial conversion price of approximately $138.38 per share of our common stock (subject to adjustment upon the occurrence of certain specified events).

~~We have the option to satisfy the conversion obligation for the 2045 Cheniere Convertible Senior Notes with cash, common stock or a combination thereof.~~

~~Cheniere Revolving Credit Facility~~

We have total commitments under the Cheniere Revolving Credit Facility of $1.25 billion. The Cheniere Revolving Credit Facility is intended to fund, through loans and letters of credit, equity capital contributions to Cheniere CCH Holdco II, LLC (“CCH HoldCo II”) and its subsidiaries for the development of the CCL Project and, provided that certain conditions are met, for general corporate purposes. As of September 30, 2021 and December 31, 2020, we had $1.3 billion and $1.1 billion of available commitments and zero and $124 million aggregate amount of issued letters of credit under the Cheniere Revolving Credit Facility, respectively. We had no loans outstanding under the Cheniere Revolving Credit Facility as of both September 30, 2021 and December 31, 2020.

The Cheniere Revolving Credit Facility matures on December 13, 2022 and contains representations, warranties and affirmative and negative covenants customary for companies like us with lenders of the type participating in the Cheniere Revolving Credit Facility that limit our ability to make restricted payments, including distributions, unless certain conditions are satisfied, as well as limitations on indebtedness, guarantees, hedging, liens, investments and affiliate transactions. Under the Cheniere Revolving Credit Facility, we are required to ensure that the sum of our unrestricted cash and the amount of undrawn commitments under the Cheniere Revolving Credit Facility is at least equal to the lesser of (1) 20% of the commitments under the Cheniere Revolving Credit Facility and (2) $200 million (the “Liquidity Covenant”). However, at any time that the aggregate principal amount of outstanding loans plus drawn and unreimbursed letters of credit under the Cheniere Revolving Credit Facility is greater than 30% of aggregate commitments under the Cheniere Revolving Credit Facility, the Liquidity Covenant will not apply and we will instead be governed by a quarterly non-consolidated leverage ratio covenant not to exceed 5.75:1.00 (the “Springing Leverage Covenant”).

The Cheniere Revolving Credit Facility is secured by a first priority security interest (subject to permitted liens and other customary exceptions) in substantially all of our assets, including our interests in our direct subsidiaries (excluding CCH HoldCo II and certain other subsidiaries).

~~Cash Receipts from Subsidiaries~~

Our ownership interest in the Sabine Pass LNG terminal is held through Cheniere Partners. As of September 30, 2021, we owned a 48.6% limited partner interest in Cheniere Partners in the form of 239.9 million common units. We also own 100% of the general partner interest and the incentive distribution rights in Cheniere Partners. We are eligible to receive quarterly equity distributions from Cheniere Partners related to our ownership interests and our incentive distribution rights.

We also receive fees for providing management services to some of our subsidiaries. We received $88 million and $83 million in total service fees from these subsidiaries during the nine months ended September 30, 2021 and 2020, respectively.

Revised Capital Allocation Plan

InAs described in Overview of Significant Events, in September ~~2021,~~2022, our Board ~~of Directors~~ approved a revised comprehensive long-term capital allocation plan. Pursuant to the revised capital allocation plan, which includes (i) repurchase, repayment or retirement of approximately $1.0 billion of existing indebtedness of the Company each year through 2024, (ii) initiation of a quarterly dividend for third quarter 2021 at $0.33 per share, payable November 17, 2021 to shareholders of record as of November, 3, 2021 and (iii) the authorized reset of the share repurchase program, as further explained below.

~~Share Repurchase Program~~

~~On June 3, 2019, we announced that~~on September 12, 2022 our ~~Board authorized a 3-year, $1.0 billion share repurchase program. On September 7, 2021, the~~ Board authorized an increase in the existing share repurchase program ~~to $1.0~~by $4.0 billion ~~inclusive of any amounts remaining under the previous authorization as of September 30, 2021,~~ for an additional three years, beginning on October 1, 2021. During the three and nine months ended September 30, 2021, we repurchased an aggregate of 0.1 shares of our common stock for $6 million, for a weighted average price per share of $83.97. During the nine months ended September 30, 2020, we repurchased an aggregate of 2.9 million shares of our common stock for $155 million, for a weighted average price per share of $53.88. As of September 30, 2021, we had up to $589 million of the share repurchase program available, which increased to $1.0 billion as of October 1, 2021. 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.2022. 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 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.~~

~~Marketing~~A further aspect of our revised capital allocation plan is to lower our long-term leverage target through debt paydown, which may involve the repayment, redemption or repurchase, on the open market or otherwise, of our indebtedness, including senior notes of SPL, CQP, CCH and Cheniere. The timing and amount of any paydown of our indebtedness will be determined by management based on market conditions and other factors.

~~We market and sell LNG produced by~~The revised capital allocation plan also includes a targeted annual dividend growth rate of approximately 10% through Corpus Christi Stage 3 Project construction. On September 12, 2022, we declared a quarterly dividend of $0.395 per common share, which represented a 20% increase from the Liquefaction Projects that is not required for other customers through our integrated marketing function. We have, and continue to develop, a portfolio of long-, medium- and short-term SPAs to transport and unload commercial LNG cargoes to locations worldwide. These volumes are expected to be primarily sourced by LNG produced by the Liquefaction Projects but supplemented by volumes procured from other locations worldwide, as needed. As of September 30, 2021, we have sold or have options to sell approximately 5,085 TBtu of LNG to be delivered to customersprevious quarterly dividend.

Corpus Christi Stage 3 Project

~~between 2021~~

The following table summarizes the project completion and ~~2045, including volume from an SPA Cheniere Marketing has committed to provide to SPL. The cargoes have been sold either on a FOB basis (delivered to the customer at the Sabine Pass LNG terminal or~~construction status of the Corpus Christi LNG terminal, as applicable) or a delivered at terminal (“DAT”) basis (delivered to the customer at their specified LNG receiving terminal). We have chartered LNG vessels to be utilized for cargoes sold on a DAT basis.

~~Cheniere Marketing has uncommitted trade finance facilities with available credit of $124 million~~Stage 3 Project as of September 30, 2021, primarily to be used for the purchase and sale of LNG for ultimate resale in the course of its operations. The finance facilities are intended to be used for advances, guarantees or the issuance of letters of credit or standby letters of credit on behalf of Cheniere Marketing. As of September 30, 2021 and December 31, 2020, Cheniere Marketing had $101 million and $34 million, respectively, in standby letters of credit and guarantees outstanding under the finance facilities. As of both September 30, 2021 and December 31, 2020, there were zero loans outstanding under the finance facilities. Cheniere Marketing pays interest or fees on utilized commitments.2022:



Overall project completion percentage						12.2%
Completion percentage of:
Engineering						24.1%
Procurement						18.6%
Subcontract work						10.8%
Construction						0.8%
Date of expected substantial completion						2H 2025 - 1H 2027

Cheniere Marketing also has an uncommitted letter of credit facility with available credit of $35 million as of September 30, 2021, for the issuance of letters of credit in the course of its operations. As of September 30, 2021, Cheniere Marketing had no letters of credit issued under the facility. Cheniere Marketing pays fees on utilized commitments.

~~Corporate and Other Activities~~

We are required to maintain corporate and general and administrative functions to serve our business activities described above. The development of our sites or other projects, including infrastructure projects in support of natural gas supply and LNG demand, will require, among other things, acceptable commercial and financing arrangements before we make an FID.

We have made an equity investment in Midship Holdings, LLC (“Midship Holdings”), which manages the business and affairs of Midship Pipeline Company, LLC (“the Midship Pipeline”). Midship Pipeline operates an approximately 200-mile natural gas pipeline project (the “Midship Project”) with current capacity of up to 1.1 million Dekatherms per day that connects new gas production in the Anadarko Basin to Gulf Coast markets, including markets serving the Liquefaction Projects. The Midship Project was placed in service in April 2020.

~~Restrictive Debt Covenants~~

~~As of September 30, 2021, each of our issuers was in compliance with all covenants related to their respective debt agreements.~~

~~LIBOR~~

The use of LIBOR is expected to be phased out by June 2023. It is currently unclear whether LIBOR will be utilized beyond that date or whether it will be replaced by a particular rate. We intend to continue working with our lenders and counterparties to pursue any amendments to our debt and derivative agreements that are currently subject to LIBOR following LIBOR cessation and will continue to monitor, assess and plan for the phase out of LIBOR.

Sources and Uses of Cash

The following table summarizes the sources and uses of our cash, cash equivalents and restricted cash ~~for the nine months ended September 30, 2021~~ and ~~2020~~cash equivalents (in millions). The table presents capital expenditures on a cash basis; therefore, these amounts differ from the amounts of capital expenditures, including accruals, which are referred to elsewhere in this report. Additional discussion of these items follows the table.

Nine Months Ended September 30,
2021 2020
Sources of cash, cash equivalents and restricted cash:
Net cash provided by operating activities $ 2,057 $ 765
Proceeds from sale of fixed assets 68 —
Proceeds from issuances of debt 4,104 7,683
Other 8 —
$ 6,237 $ 8,448
Uses of cash, cash equivalents and restricted cash:
Property, plant and equipment $ (761) $ (1,437)
Investment in equity method investment — (100)
Repayments of debt (4,276) (6,324)
Debt issuance and other financing costs (38) (124)
Debt modification or extinguishment costs (67) (170)
Distributions to non-controlling interest (483) (468)
Payments related to tax withholdings for share-based compensation (47) (43)
Repurchase of common stock (6) (155)
Other (14) (8)
(5,692) (8,829)
Net increase (decrease) in cash, cash equivalents and restricted cash $ 545 $ (381)


	Nine Months Ended September 30,
	2022		2021

Net cash provided by operating activities	$	7,571	$	2,057
Net cash used in investing activities	(1,348)		(707)
Net cash used in financing activities	(4,707)		(805)
Effect of exchange rate changes on cash, cash equivalents and restricted cash and cash equivalents	5		—

















Net increase in cash, cash equivalents and restricted cash and cash equivalents	$	1,521	$	545

Table of Contents

Operating Cash Flows

Our operating cash net inflows during the nine months ended September 30, 2022 and 2021 were $7.6 billion and ~~2020 were $2,057 million and $765 million,~~$2.1 billion, respectively. The ~~$1,292 million~~$5.5 billion increase ~~in operating cash inflows in 2021 compared to 2020~~ was primarily related to increased cash receipts from the sale of LNG cargoes due to higher revenue per MMBtu and to a lesser extent higher volume of LNG delivered, as well as from higher than normal contributions from LNG and natural gas portfolio optimization activities due to significant volatility in LNG and natural gas markets during the nine months ended September 30, 2021.delivered. Partially offsetting these operating cash inflows were higher operating cash outflows primarily due to higher natural gas feedstock costs and ~~payment of paid-in-kind interest on our convertible notes.~~lower contribution from certain portfolio optimization activities.

~~Proceeds from Sale~~On August 16, 2022, President Biden signed H.R. 5376 (P.L. 117-169), commonly referred to as the Inflation Reduction Act, into law, which includes the implementation of ~~Fixed Assets~~a new 15% corporate alternative minimum tax (the “CAMT”) effective in 2023 on the adjusted financial statement income of certain large corporations, among other provisions. The CAMT may cause volatility in our cash tax payment obligations, particularly in periods of significant commodity, currency or financial market variability resulting in potential changes in the fair value of our derivative instruments.

Investing Cash Flows

Our investing cash net outflows in both years primarily was for the construction costs for the Liquefaction Projects. The $641 million increasein 2022 compared to 2021 was primarily due to spend during the nine months ended September 30, 2022 related to construction work performed by Bechtel for the Corpus Christi Stage 3 Project, partially offset by a decrease in spend due to the completion of Train 6 of the SPL Project in February 2022, which was under construction throughout 2021. We expect our capital expenditures to increase in future periods as construction work progresses on the Corpus Christi Stage 3 Project following our issuance of full notice to proceed to Bechtel in June 2022.

Financing Cash Flows

The following table summarizes our financing activities (in millions):


	Nine Months Ended September 30,
	2022		2021
Proceeds from issuances of debt	$	1,015	$	4,104
Redemptions and repayments of debt	(4,005)		(4,276)



Distributions to non-controlling interest	(686)		(483)

Repurchase of common stock	(640)		(6)
Dividends to shareholders	(251)		—
Other, net	(140)		(144)
Net cash used in financing activities	$	(4,707)	$	(805)

Debt Issuances and Related Financing Costs

The following table shows the issuances of debt, including intra-quarter borrowings (in millions):


	Nine Months Ended September 30,
	2022		2021





CQP:

4.000% Senior Notes due 2031	$	—	$	1,500
3.25% Senior Notes due 2032	—		1,200


CCH:
2.742% Senior Notes due 2029	—		750

CCH Credit Facility	440		—





Cheniere:

Cheniere Revolving Credit Facility	575		434
Cheniere’s term loan facility (the “Cheniere Term Loan Facility”)	—		220
Total debt issuances	$	1,015	$	4,104

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During the nine months ended September 30, 2022 and 2021, we ~~received proceeds from~~paid debt issuance costs and other financing costs of $44 millionand$38 million, respectively, included in other in the ~~sale~~Financing Cash Flows table above, related to the debt issuances above and amendment of ~~fixed assets of $68 million from divestment of non-core land holdings.~~credit facilities during the respective periods.

~~Proceeds from Issuances of~~ Debt Redemptions, Repayments ~~of Debt, Debt Issuance~~ and ~~Other Financing Costs~~Repurchases and ~~Debt~~Related Modification or Extinguishment Costs

During the nine months ended September 30, ~~2021,~~2022, we ~~issued $3,450~~paid down a total of $4.0 billion of outstanding indebtedness, which included $530 million ~~aggregate principal amount~~ of ~~senior~~debt repurchases on the open market and the remaining associated with redemptions of our outstanding notes ~~and borrowed an aggregate amount~~or paydown of ~~$654 million under~~ our credit facilities. The proceeds from these issuances and borrowings, together with cash on hand, were used to redeem $2,172 million aggregate principal amount of senior notes, repay $476 million of the 2021 Cheniere Convertible Notes and prepay $1,808 million aggregate outstanding borrowings under our credit facilities. We incurred $38 million of debt issuance costs related to these issuances, and incurred $67 million of debt modification or extinguishment costs related to these redemptions and repayments, primarily for the payment of early redemption fees and write off of unamortized issuance costs.

During the nine months ended September 30, ~~2020,~~2021, we ~~issued $4,769 million aggregate principal amount~~redeemed or repurchased a total of ~~senior~~$4.3 billion outstanding indebtedness, entirely associated with redemptions of our outstanding notes ~~and borrowed an aggregate amount~~or paydown of ~~$2,919 million under~~ our credit facilities. The proceeds from these issuances and borrowings, together with cash on hand, were used to redeem $2.0 billion aggregate principal amount of 2021 SPL Senior Notes, redeem or repurchase $1,513 million of our convertible notes and prepay $2,811 million aggregate outstanding

~~borrowings under our credit facilities. We incurred $124 million~~The following table shows the redemptions and repayments of debt, ~~issuance costs related to these issuances~~including intra-quarter repayments (in millions):


	Nine Months Ended September 30,
	2022		2021





CQP:
5.250% Senior Notes due 2025	$	—	$	(1,500)
5.625% Senior Notes due 2026	—		(672)


CCH:
CCH Credit Facility	(2,169)		—
CCH Working Capital Facility	(250)		(1,006)
3.700% Senior Notes due 2029	(8)		—
3.72% weighted average Senior Notes rate due 2039	(17)		—

Cheniere:
4.875% Cheniere Convertible Senior Notes due 2021	—		(296)
4.25% Convertible Senior Notes due 2045	(500)		—
Cheniere Revolving Credit Facility	(575)		(434)
4.625% Senior Secured Notes due 2028	(486)		—
Cheniere Term Loan Facility	—		(368)

Total debt redemptions, repayments and repurchases	$	(4,005)	$	(4,276)

During the nine months ended September 30, 2022 and ~~the closing of the 2020 SPL Working Capital Facility, and incurred $170 million of~~2021, we paid debt modification or extinguishment costs of $33 million and $67 million, respectively, included in other, net in the Financing Cash Flows table above, related to these redemptions and ~~repayments, primarily for the payment of early redemption fees and write off of unamortized issuance costs.~~repayments.

~~Property, Plant and Equipment~~

Cash outflows for property, plant and equipment were primarily for the construction costs for the Liquefaction Projects. These costs are capitalized as construction-in-process until achievement of substantial completion. Additionally, we purchased land adjacent to the CCL Project for potential future expansion purposes.

Non-Controlling Interest Distributions ~~to Non-controlling Interest~~

We own a 48.6% limited partner interest in ~~Cheniere Partners,~~CQP with the remaining non-controlling limited partner interest held by ~~The~~ Blackstone ~~Group~~ Inc., Brookfield Asset Management Inc. and the ~~public, to whom Cheniere Partners~~public. CQP paid distributions of $686 million and $483 million during the ~~three and~~ nine months ended September 30, 2022 and 2021, ~~and 2020.~~respectively, to non-controlling interests.

Repurchase of Common Stock

The following table presents information with respect to repurchases of common stock (in millions, except per share data):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Aggregate common stock repurchased	0.60		0.08		4.97		0.08
Weighted average price paid per share	$	125.34	$	83.97	$	128.73	$	83.97
Total amount paid	$	75	$	6	$	640	$	6

As of September 30, 2022, we had $358 million remaining under our share repurchase program, which increased to approximately $4.4 billion as of October 1, 2022.

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Cash Dividends to Shareholders

During the nine months ended September 30, ~~2021 and 2020,~~2022, we paid ~~$6 million and $155 million, respectively, to repurchase approximately 0.1 million shares and 2.9 million shares, respectively~~aggregate dividends of ~~our~~$0.99 per share of common stock, ~~under our share repurchase program.~~for a total of $251 million paid to common shareholders. We did not pay dividends during the nine months ended September 30, 2021.

~~Off-Balance Sheet Arrangements~~

AsOn September 12, 2022, we declared a quarterly dividend of ~~September 30, 2021, we had no transactions~~$0.395 per share of common stock that ~~met the definition~~is payable on November 16, 2022 to shareholders of ~~off-balance sheet arrangements that may have a current or future material effect on our consolidated financial position or operating results.~~

record as of November 8, 2022.

Summary of Critical Accounting Estimates

The preparation of Consolidated Financial Statements in conformity with GAAP requires management to make certain estimates and assumptions that affect the amounts reported in the Consolidated Financial Statements and the accompanying notes. There have been no significant changes to our critical accounting estimates from those disclosed in our annual report on Form 10-K for the fiscal year ended December 31, ~~2020~~2021..

Recent Accounting Standards

For a summary of recently issued accounting standards, see Note 1—Nature of Operations and Basis of Presentation of our Notes to Consolidated Financial Statements.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Marketing and Trading Commodity Price Risk

We have entered into commodity derivatives consisting of natural gas supply contracts for the commissioning and operation of the SPL Project and the CCL Project ~~and potential future development of Corpus Christi Stage 3~~ (“Liquefaction Supply Derivatives”). We have also entered into physical and financial derivatives to hedge the exposure to the commodity markets in which we have contractual arrangements to purchase or sell physical LNG (collectively, “LNG Trading Derivatives”). In order to test the sensitivity of the fair value of the Liquefaction Supply Derivatives and the LNG Trading Derivatives to changes in underlying commodity prices, management modeled a 10% change in the commodity price for natural gas for each delivery location and a 10% change in the commodity price for LNG, respectively, as follows (in millions):

September 30, 2021 December 31, 2020
Fair Value Change in Fair Value Fair Value Change in Fair Value
Liquefaction Supply Derivatives $ (2,629) $ 763 $ 240 $ 204
LNG Trading Derivatives (1,113) 168 (134) 44


	September 30, 2022				December 31, 2021
	Fair Value		Change in Fair Value		Fair Value		Change in Fair Value
Liquefaction Supply Derivatives	$	(13,916)	$	2,625	$	(4,038)	$	903
LNG Trading Derivatives	(127)		44		(400)		38

See Note 6—Derivative Instruments of our Notes to Consolidated Financial Statements for additional details about our ~~derivative instruments.~~

~~Interest Rate Risk~~

We are exposed to interest rate risk primarily when we incur debt related to project financing. Interest rate risk is managed in part by replacing outstanding floating-rate debt with fixed-rate debt with varying maturities. CCH has entered into interest rate swaps to hedge the exposure to volatility in a portion of the floating-rate interest payments under the CCH Credit Facility (“CCH Interest Rate Derivatives”). In order to test the sensitivity of the fair value of the CCH Interest Rate Derivatives to changes in interest rates, management modeled a 10% change in the forward one-month LIBOR curve across the remaining terms of the CCH Interest Rate Derivatives as follows (in millions):

September 30, 2021 December 31, 2020
Fair Value Change in Fair Value Fair Value Change in Fair Value
CCH Interest Rate Derivatives $ (67) $ — $ (140) $ 1

~~See~~ ~~Note 6—Derivative Instruments~~ ~~for additional details about our~~commodity derivative instruments.

Foreign Currency Exchange Risk

We have entered into foreign currency exchange (“FX”) contracts to hedge exposure to currency risk associated with operations in countries outside of the United States (“FX Derivatives”). In order to test the sensitivity of the fair value of the FX Derivatives to changes in FX rates, management modeled a 10% change in FX rate between the U.S. dollar and the applicable foreign currencies as follows (in millions):

September 30, 2021 December 31, 2020
Fair Value Change in Fair Value Fair Value Change in Fair Value
FX Derivatives $ 9 $ 1 $ (22) $ 2


	September 30, 2022				December 31, 2021
	Fair Value		Change in Fair Value		Fair Value		Change in Fair Value
FX Derivatives	$	51	$	5	$	12	$	2

See Note 6—Derivative Instruments of our Notes to Consolidated Financial Statements for additional details about our foreign currency derivative instruments.

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ITEM 4. CONTROLS AND PROCEDURES

We maintain a set of disclosure controls and procedures that are designed to ensure that information required to be disclosed by us in the reports filed by us under the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. As of the end of the period covered by this report, we evaluated, under the supervision and with the participation of our management, including our Chief Executive Officer and our Chief Financial Officer, the effectiveness of our disclosure controls and procedures pursuant to Rule 13a-15 of the Exchange Act. Based on that evaluation, our Chief Executive Officer and our Chief Financial Officer concluded that our disclosure controls and procedures are effective.

During the most recent fiscal quarter, there have been no changes in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

We may in the future be involved as a party to various legal proceedings, which are incidental to the ordinary course of business. We regularly analyze current information and, as necessary, provide accruals for probable liabilities on the eventual disposition of these matters. Other than discussed below, there have been no material changes to the legal proceedings disclosed in our annual report on Form 10-K for the fiscal year ended December 31, ~~2020~~2021.

Louisiana Department of Environmental Quality (“LDEQ”) Matter

Certain of our subsidiaries are in discussions with the LDEQ to resolve self-reported deviations arising from operation of the Sabine Pass LNG Terminal and the commissioning of the SPL Project, and relating to certain requirements under its Title V Permit. The matter involves deviations self-reported to LDEQ pursuant to the Title V Permit and covering the time period from January 1, 2012 through March 25, 2016. On April 11, 2016, certain of our subsidiaries received a Consolidated Compliance Order and Notice of Potential Penalty (the “Compliance Order”) from LDEQ covering deviations self-reported during that time period. Certain of our subsidiaries continue to work with LDEQ to resolve the matters identified in the Compliance Order. We do not expect that any ultimate sanction will have a material adverse impact on our financial results.

Pipeline and Hazardous Materials Safety Administration (“PHMSA”) Matter

In February 2018, the ~~Pipeline and Hazardous Materials Safety Administration (“PHMSA”)~~PHMSA issued a Corrective Action Order (the “CAO”) to SPL in connection with a minor LNG leak from one tank and minor vapor release from a second tank at the Sabine Pass LNG ~~terminal.~~Terminal (the “2018 SPL tank incident”). These two tanks have been taken out of operational service while we conduct analysis, repair and remediation. On April 20, 2018, SPL and PHMSA executed a Consent Agreement and Order (the “Consent Order”) that replaces and supersedes the CAO. On July 9, 2019, PHMSA and FERC issued a joint letter setting out operating conditions required to be met prior to SPL returning the tanks to service. In July 2021, PHMSA issued a Notice of Probable Violation (“NOPV”) and Proposed Civil Penalty to SPL alleging violations of federal pipeline safety regulations relating to the 2018 SPL tank incident and proposing civil penalties totaling $2,214,900. On September 16, 2021, PHMSA issued an Amended NOPV that reduced the proposed penalty to $1,458,200. On October 12, 2021, SPL responded to the Amended NOPV, electing not to contest the alleged violations in the Amended NOPV and electing to pay the proposed reduced penalty. PHMSA notified SPL in a letter dated November 9, 2021 that the case was considered “closed.” On March 9, 2022, PHMSA and FERC issued conditional approval to return one of the two tanks to service. SPL continues to coordinate with PHMSA and FERC to address the matters relating to the ~~February~~ 2018 ~~leak,~~SPL tank incident, including repair approach and related analysis. We do not expect that the Consent Order and related analysis, repair and remediation or resolution of the NOPV will have a material adverse impact on our financial results or operations.

ITEM 1A. RISK FACTORS

There have been no material changes from the risk factors disclosed in our annual report on Form 10-K for the fiscal year ended December 31, ~~2020~~2021.

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ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Purchase of Equity Securities by the Issuer and Affiliated Purchasers

The following table summarizes stock repurchases for the three months ended September 30, ~~2021:~~2022:

Period Total Number of Shares Purchased (1) Average Price Paid Per Share (2) Total Number of Shares Purchased as a Part of Publicly Announced Plans Approximate Dollar Value of Shares That May Yet Be Purchased Under the Plans (3)
July 1 - 31, 2021 93,008 $85.31 44,100 $592,272,032
August 1 - 31, 2021 32,019 $84.62 30,500 $589,692,332
September 1 - 30, 2021 2,500 $85.43 2,500 $589,478,717
Total 127,527 $85.14 77,100


Period	Total Number of Shares Purchased (1)	Average Price Paid Per Share (2)	Total Number of Shares Purchased as a Part of Publicly Announced Plans	Approximate Dollar Value of Shares That May Yet Be Purchased Under the Plans (3)
July 1 - 31, 2022	638,816	$125.72	602,347	$357,655,508
August 1 - 31, 2022	—	$—	—	$357,655,508
September 1 - 30, 2022	—	$—	—	$357,655,508
Total	638,816		602,347

(1)Includes issued shares surrendered to us by participants in our share-based compensation plans for payment of applicable tax withholdings on the vesting of share-based compensation awards. Associated shares surrendered by participants are repurchased pursuant to terms of the plan and award agreements and not as part of the publicly announced share repurchase plan.

(2)The price paid per share was based on the average trading price of our common stock on the dates on which we repurchased the shares.

(3)On ~~June 3, 2019, we announced that~~September 12, 2022, our ~~Board authorized a 3-year, $1.0 billion share repurchase program. On September 7, 2021, the~~ Board authorized an increase in the existing share repurchase program ~~to $1.0~~by $4.0 billion ~~inclusive of any amounts remaining under the previous authorization as of September 30, 2021,~~ for an additional three years, beginning on October 1, ~~2021.~~2022. For additional information, see ~~Share~~Note 15—Stock Repurchase ~~Program~~ in ~~Liquidity and Capital Resources~~Programs.

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ITEM 6. EXHIBITS

Exhibit No.

~~Exhibit No.~~

Description

~~4.1~~

~~Fifth Supplemental Indenture, dated as of August 24, 2021, among~~ ~~CCH, as issuer,~~ ~~CCL~~, ~~CCP~~ and Corpus Christi Pipeline GP, LLC, as guarantors, and The Bank of New York Mellon, as trustee (incorporated by reference to Exhibit 4.1 to CCH’s Current Report on Form 8-K (SEC File No. 333-215435), filed on August 24, 2021)

~~4.2~~

~~Sixth Supplemental Indenture, dated as of September 27, 2021, among~~ ~~Cheniere Partners, the guarantors party thereto and The Bank of New York Mellon, as Trustee under the Indenture (incorporated by reference to Exhibit 4.1 to~~ ~~Cheniere Partners~~’~~Current Report on Form 8-K (SEC File No. 001-33366), filed on September 27, 2021)~~

10.1*

Change orders to the Lump Sum Turnkey Agreement for the Engineering, Procurement and Construction of the Sabine Pass LNG Stage 4 Liquefaction Facility, dated November 7, 2018, by and between SPL and Bechtel Oil Gas and Chemicals, Inc.: (i) the Change Order ~~CO-000~~49CO-00067 Performance and Attendance Bonus (“PAB”) Provisional Sum Closure, dated August 18, 2022, (ii) the Change Order CO-00068 Performance and Attendance Bonus (“PAB”) Provisional Sum Closure (Reconciliation to CO-00067), dated August 18, 2022, and (iii) the Change Order CO-00069 COVID-19 Impacts ~~2Q2021,~~1Q2022 and 2Q2022, dated ~~July 6, 2021, (ii) CO-00050 Third Berth Bunkering Ship Modifications~~ —~~Pre-Investment for Foundations, dated July 6, 2021, (iii) CO-00051 Thermal Oxidizer Controls Change, dated September~~ ~~8, 2021~~, ~~(iv) CO-00052 Third Berth Spare Beacon and Additional Cable Tray, dated September~~ ~~8, 2021 and (v) CO-0053 Train 6 Gearbox Assembly Replacement for Unit 1411, dated September 24, 202~~1August 29, 2022

10.2*

~~First~~ ~~Amendment~~Change orders to ~~Third Amended~~the Lump Sum Turnkey Agreement for the Engineering, Procurement and ~~Restated Common Terms Agreement,~~Construction of the Corpus Christi Liquefaction Stage 3 Project, dated asMarch 1, 2022, by and between CCL Stage III and Bechtel Oil Gas and Chemicals, Inc.: (i) the Change Order CO-00004 Currency Conversion, dated June 27, 2022, (ii) the Change Order CO-00005 Fuel Adjustment, dated July 15, 2022, (iii) the Change Order CO-00006 Removal of ~~July 26, 202~~1 , among SPL, as borrower, the Secured Debt Holder Group Representatives party thereto, the Secured Hedge Representatives party thereto, the Secured Gas Hedge Representatives party thereto and Société Générale, as the Common Security Trustee and the I ~~ntercreditor Agent~~

~~10.3~~

~~Second Employment Agreement Amendment between~~ ~~the Company~~ ~~and Jack~~ A. ~~Fusco,~~Laydown Yard Scope Option, dated August ~~11, 2021 (Incorporated by reference to Exhibit 10.1 to~~ 2, 2022, (iv) the ~~Company~~’s ~~Current Report on Form 8-K (SEC File No. 001-16383)~~Change Order CO-00007 Removal of Air Bridges Scope Option, dated August 22, 2022, (v) the Change Order CO-00008 Acid Gas Flare K/O Drum, dated August 16, 2022, and (vi) the Change Order CO-00009 Package 7A (Without Site Work), ~~filed on~~dated August ~~13, 2021)~~

~~10.4~~

~~Registration Rights Agreement, dated as~~16, 2022 (Portions of ~~August 24, 2021, among~~ ~~CCH~~ ~~and~~ ~~CCL~~, ~~CCP~~ and Corpus Christi Pipeline GP, LLC, as guarantors, and Morgan Stanley & Co. LLC, for itself and as representative of the purchasers (incorporated by reference to Exhibit 10.1 to CCH’s Current Report on Form 8-K (SEC File No. 333-215435), filed on August 24, 2021)

~~10.5~~

~~Registration Rights Agreement, dated as of September 27, 2021, among Cheniere~~ ~~Partners, the guarantors party thereto and RBC Capital Markets, LLC (incorporated by reference to Exhibit 10.1 to Cheniere~~ ~~Partners~~’~~Current Report on Form 8-K (SEC File No. 001-33366), filed on September 27, 2021)~~this exhibit have been omitted.)

31.1*

Certification by Chief Executive Officer required by Rule 13a-14(a) and 15d-14(a) under the Exchange Act

31.2*

Certification by Chief Financial Officer required by Rule 13a-14(a) and 15d-14(a) under the Exchange Act

32.1**

Certification by Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

32.2**

Certification by Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

101.INS*

XBRL Instance Document

101.SCH*

XBRL Taxonomy Extension Schema Document

101.CAL*

XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF*

XBRL Taxonomy Extension Definition Linkbase Document

101.LAB*

XBRL Taxonomy Extension Labels Linkbase Document

101.PRE*

XBRL Taxonomy Extension Presentation Linkbase Document

104*

Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)



*			Filed herewith.
**			Furnished herewith.

5547

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


		CHENIERE ENERGY, INC.







Date:	November ~~3, 2021~~2, 2022	By:	/s/ Zach Davis
			Zach Davis
			~~Senior~~Executive Vice President and Chief Financial Officer
			(on behalf of the registrant and as principal financial officer)

Date:	November ~~3, 2021~~2, 2022	By:	/s/ ~~Leonard E. Travis~~David Slack
			~~Leonard E. Travis~~David Slack
			~~Senior~~ Vice President and Chief Accounting Officer
			(on behalf of the registrant and as principal accounting officer)

5648


	Three Months Ended September 30, 2021		Nine Months Ended September 30, 2021
(in TBtu)	Operational	Commissioning	Operational	Commissioning
Volumes loaded during the current period	500	—	1,447	28
Volumes loaded during the prior period but recognized during the current period	23	—	26	3
Less: volumes loaded during the current period and in transit at the end of the period	(34)	—	(34)	—
Total volumes recognized in the current period	489	—	1,439	31