DEBT AND CREDIT FACILITIES

9 Months Ended

Sep. 30, 2021

Debt Disclosure [Abstract]

DEBT AND CREDIT FACILITIES

DEBT AND CREDIT FACILITIES

LINES OF CREDIT

Primary U.S. Committed Lines of Credit

In May 2021, Sempra Global assigned its $3.2 billion, five-year committed line of credit facility to Sempra and Sempra assumed all rights and responsibilities under the credit agreement. Also, in May 2021, Sempra established a commercial paper program to replace Sempra Global’s commercial paper program that was terminated in June 2021.

At September 30, 2021, Sempra had an aggregate capacity of $6.7 billion from primary U.S. committed lines of credit, which provide liquidity and support commercial paper. The principal terms of these committed lines of credit, which expire in May 2024, are described below and in Note 7 of the Notes to Consolidated Financial Statements in the Annual Report.

PRIMARY U.S. COMMITTED LINES OF CREDIT
(Dollars in millions)
	September 30, 2021
	Total facility		Commercial paper outstanding(1)(2)		Available unused credit
Sempra(3)	$	4,435	$	(2,112)	$	2,323
SDG&E(4)	1,500		—		1,500
SoCalGas(4)	750		—		750
Total	$	6,685	$	(2,112)	$	4,573

(1)    Because the commercial paper programs are supported by these lines, we reflect the amount of commercial paper outstanding as a reduction to the available unused credit.

(2)    Commercial paper outstanding is before reductions of a negligible amount of unamortized discount.

(3)    The facility also provides for issuance of $200 million of letters of credit on behalf of Sempra with the amount of borrowings otherwise available under the facility reduced by the amount of outstanding letters of credit. Subject to obtaining commitments from existing or new lenders and satisfaction of other specified conditions, Sempra has the right to increase the letter of credit commitment up to $500 million. No letters of credit were outstanding at September 30, 2021.

(4)    The facility also provides for issuance of $100 million of letters of credit on behalf of the borrowing utility with the amount of borrowings otherwise available under the facility reduced by the amount of outstanding letters of credit. Subject to obtaining commitments from existing or new lenders and satisfaction of other specified conditions, the borrowing utility has the right to increase the letter of credit commitment up to $250 million. No letters of credit were outstanding at September 30, 2021.

Sempra, SDG&E and SoCalGas each must maintain a ratio of indebtedness to total capitalization (as defined in each of the applicable credit facilities) of no more than 65% at the end of each quarter. At September 30, 2021, each entity was in compliance with this ratio under its respective credit facility.

Foreign Committed Lines of Credit

Our foreign operations in Mexico have committed lines of credit with an aggregate capacity of $1.9 billion at September 30, 2021. The principal terms of these committed lines of credit are described in Note 7 of the Notes to Consolidated Financial Statements in the Annual Report.

FOREIGN COMMITTED LINES OF CREDIT
(U.S. dollar equivalent in millions)
	September 30, 2021
Expiration date of facility	Total facility		Amounts outstanding		Available unused credit
February 2024	$	1,500	$	—	$	1,500
September 2023(1)	350		(294)		56
Total	$	1,850	$	(294)	$	1,556

(1)    In September 2021, IEnova amended this revolving credit facility to increase the amount available under the facility from $280 million to $350 million and extend the expiration of the facility from September 2021 to September 2023. Borrowings continue to bear interest at a per annum rate equal to 3-month LIBOR plus 54 bps.

Foreign Uncommitted Lines of Credit

In addition to our committed lines of credit, our foreign operations in Mexico have uncommitted lines of credit with an aggregate capacity of $470 million at September 30, 2021, which are generally used for working capital requirements.

FOREIGN UNCOMMITTED LINES OF CREDIT
(U.S. dollar equivalent in millions)
		September 30, 2021
Expiration date of facility	Borrowing denomination	Total facility		Amounts outstanding		Available unused credit
September 2022(1)	U.S. dollars	$	250	$	(250)	$	—
August 2023(2)	U.S. dollars or Mexican pesos	100		(37)		63
October 2023(3)	U.S. dollars	100		—		100
October 2023(4)	U.S. dollars or Mexican pesos	20		—		20
Total		$	470	$	(287)	$	183

(1)    IEnova’s one-year credit agreement under which borrowings bear interest at a per annum rate equal to 3-month LIBOR plus 10 bps.

(2)    ECA LNG Phase 1’s two-year credit agreement under which outstanding amounts were borrowed in Mexican pesos and bear interest at a variable rate based on the 28-day Interbank Equilibrium Interest Rate plus 105 bps and are before reductions from negligible unamortized discount. Borrowings made in U.S. dollars bear interest at a variable rate based on the 1-month or 3-month LIBOR plus 105 bps.

(3)    IEnova’s three-year credit agreement under which borrowings bear interest at a per annum rate equal to 6-month LIBOR plus 52 bps.

(4)    IEnova’s three-year credit agreement under which borrowings made in Mexican pesos bear interest at a variable rate based on the 28-day Interbank Equilibrium Interest Rate plus an applicable margin. Borrowings made in U.S. dollars bear interest at a variable rate based on 1-month LIBOR plus an applicable margin. The applicable margin is determined on the date of borrowing.

Letters of Credit

Outside of our domestic and foreign committed credit facilities, we have bilateral unsecured standby letter of credit capacity with select lenders that is uncommitted and supported by reimbursement agreements. At September 30, 2021, we had approximately $697 million in standby letters of credit outstanding under these agreements.

TERM LOAN

In June 2021, SDG&E entered into a $375 million, 364-day term loan with a maturity date of June 27, 2022. At September 30, 2021, $375 million, net of negligible issuance costs, was outstanding under the term loan. The borrowing bears interest at benchmark rates plus 62.5 bps. The term loan provides SDG&E with additional liquidity outside of its line of credit.

WEIGHTED-AVERAGE INTEREST RATES

The weighted-average interest rates on the total short-term debt at September 30, 2021 and December 31, 2020 were as follows:

WEIGHTED-AVERAGE INTEREST RATES
	September 30, 2021		December 31, 2020
Sempra	0.39	%	0.83	%
SDG&E	0.76		—
SoCalGas	—		0.14

LONG-TERM DEBT

SDG&E

In August 2021, SDG&E issued $750 million of 2.95% green first mortgage bonds maturing in 2051 and received proceeds of $737 million (net of debt discount, underwriting discounts and debt issuance costs of $13 million). SDG&E intends to use the net proceeds to finance or refinance eligible projects that fall into one or more of the following categories: climate change adaptation, clean energy solutions and clean transportation.

Sempra Mexico

As we discuss in Note 5, through its acquisition of ESJ, Sempra Mexico assumed a $177 million (net of $6 million in unamortized debt issuance costs) variable rate loan payable to a syndicate of five lenders that matures in June 2033. To moderate exposure to interest rate and associated cash flow variability, ESJ entered into floating-to-fixed rate swaps for 90% of the principal balance, resulting in a fixed rate of 6.13%. The remaining 10% of the principal balance bears interest at 6-month LIBOR plus a margin of 2.63% with an increase of 25 bps every four years (2.80% at September 30, 2021). On October 8, 2021, Sempra Mexico used proceeds from borrowings against its committed and uncommitted lines of credit to fully repay $175 million of outstanding principal plus accrued and unpaid interest on the ESJ loan prior to its scheduled maturity in 2033, and recognized approximately $16 million ($10 million after tax and NCI) in charges associated with hedge termination costs and a write-off of unamortized debt issuance costs.

On October 13, 2021, Sempra Mexico used proceeds from borrowings against its committed and uncommitted lines of credit to fully repay $375 million of outstanding principal plus accrued and unpaid interest on the Ventika fixed- and variable-rate loans prior to scheduled maturity dates through 2032, and recognized approximately $34 million ($20 million after tax and NCI) in charges associated with hedge termination costs and a write-off of unamortized debt issuance costs.

Sempra LNG

In December 2020, ECA LNG Phase 1 entered into a five-year loan agreement with a syndicate of nine banks for an aggregate principal amount of up to $1.6 billion. At September 30, 2021 and December 31, 2020, $291 million and $17 million, respectively, was outstanding, with a weighted-average interest rate of 2.84% and 2.82%, respectively. We discuss the details of this agreement in Note 7 of the Notes to Consolidated Financial Statements in the Annual Report.

Parent and Other

On November 1, 2021, Sempra issued notices to redeem, at respective make-whole redemption prices, an aggregate principal amount of $2.35 billion of senior unsecured notes prior to scheduled maturities in 2022 through 2025. Upon redemption, which is scheduled to occur in December 2021, we expect to recognize approximately $128 million ($93 million after tax) in charges associated with the make-whole premiums from the early redemptions and write-off of unamortized discount and debt issuance costs. As a result of our expected early redemption, this debt was classified as Current Portion of Long-Term Debt and Finance Leases on Sempra’s Condensed Consolidated Balance Sheet at September 30, 2021.