Leases, as lessee

12 Months Ended

Dec. 31, 2023

Leases [Abstract]

Leases, as lessee

Leases, as lessee

The Company has operating leases primarily for the use of LNG vessels, marine port space, office space, land and equipment under non-cancellable lease agreements. The Company’s leases may include multiple optional renewal periods that are exercisable solely at the Company’s discretion. Renewal periods are included in the lease term when the Company is reasonably certain that the renewal options would be exercised, and the associated lease payments for such periods are reflected in the ROU asset and lease liability.

The Company’s leases include fixed lease payments which may include escalation terms based on a fixed percentage or may vary based on an inflation index or other market adjustments. Escalations based on changes in inflation indices and market adjustments and other lease costs that vary based on the use of the underlying asset are not included as lease payments in the calculation of the lease liability or ROU asset; such payments are included in variable lease cost when the obligation that triggers the variable payment becomes probable. Variable lease cost includes contingent rent payments for office space based on the percentage occupied by the Company in addition to common area charges and other charges that are variable in nature. The Company also has a component of lease payments that are variable related to the LNG vessels, in which the Company may receive credits based on the performance of the LNG vessels during the period.

As of December 31, 2023 and 2022, ROU assets, current lease liabilities and non-current lease liabilities consisted of the following:

	December 31, 2023		December 31, 2022
Operating right-of-use assets	$	538,055	$	355,883
Finance right-of-use assets (1)	50,330		21,994
Total right-of-use assets	$	588,385	$	377,877
Current lease liabilities:
Operating lease liabilities	$	135,867	$	44,371
Finance lease liabilities	28,681		4,370
Total current lease liabilities	$	164,548	$	48,741
Non-current lease liabilities:
Operating lease liabilities	$	390,519	$	290,899
Finance lease liabilities	15,975		11,222
Total non-current lease liabilities	$	406,494	$	302,121

(1)Finance lease ROU assets are recorded net of accumulated amortization of $21,470 and $2,134 as of December 31, 2023 and 2022, respectively.

For the years ended December 31, 2023, 2022, and 2021, the Company’s operating lease cost recorded within the Consolidated Statements of Operations and Comprehensive Income were as follows:

	Year Ended December 31,
	2023		2022		2021
Fixed lease cost	$	109,873	$	75,771	$	41,054
Variable lease cost	4,601		2,203		1,711
Short-term lease cost	23,903		20,129		6,974
Lease cost - Cost of sales	$	88,608	$	87,610	$	41,147
Lease cost - Operations and maintenance	42,520		3,681		2,343
Lease cost - Selling, general and administrative	7,249		6,812		6,249

For the years ended December 31, 2023, 2022 and 2021, the Company has capitalized $61,320, $20,403 and $15,568 of lease costs, respectively. Capitalized costs include vessels and port space used during the commissioning of development projects. Short-term lease costs for vessels chartered by the Company to transport inventory from a supplier’s facilities to the Company’s storage locations are capitalized to inventory.

The Company has leases of turbines, ISO tanks and a parcel of land that are recognized as finance leases. For the years ended December 31, 2023, 2022 and 2021, the Company’s finance interest expense and amortization recorded in Interest expense and Depreciation and amortization, respectively, within the Consolidated Statements of Operations and Comprehensive Income were as follows:

	Year Ended December 31,
	2023		2022		2021
Interest expense related to finance leases	$	3,706	$	852	$	409
Amortization of right-of-use asset related to finance leases	19,337		1,512		622

Cash paid for operating leases is reported in operating activities in the consolidated statements of cash flows. Supplemental cash flow information related to leases was as follows for the years ended December 31, 2023, 2022 and 2021:

	Year Ended December 31,
	2023		2022		2021
Operating cash outflows for operating lease liabilities	$	133,132	$	96,698	$	46,066
Financing cash outflows for finance lease liabilities	21,187		3,697		2,156
Right-of-use assets obtained in exchange for new operating lease liabilities	265,537		135,075		172,996
Right-of-use assets obtained in exchange for new finance lease liabilities	47,672		—		24,533

The future payments due under operating and finance leases as of December 31, 2023 are as follows:

	Operating Leases		Financing Leases
2024	$	179,273	$	30,939
2025	125,262		12,427
2026	78,023		3,041
2027	77,557		436
2028	76,966		89
Thereafter	174,365		853
Total Lease Payments	$	711,446	$	47,785
Less: effects of discounting	185,060		3,129
Present value of lease liabilities	$	526,386	$	44,656
Current lease liability	$	135,867	$	28,681
Non-current lease liability	390,519		15,975

As of December 31, 2023, the weighted-average remaining lease term for operating leases was 5.9 years and finance leases was 2.0 years. Because the Company generally does not have access to the rate implicit in the lease, the incremental borrowing rate is utilized as the discount rate. The weighted average discount rate associated with operating leases as of December 31, 2023 and 2022 was 10.1% and 8.5%, respectively. The weighted average discount rate associated with finance leases as of December 31, 2023 and 2022 was 8.2% and 5.1%, respectively.

In January 2024, the Company has commenced a 10-year lease of a vessel with expected future payments of approximately $376 million.

Leases, as lessee

Leases, as lessee

The Company has operating leases primarily for the use of LNG vessels, marine port space, office space, land and equipment under non-cancellable lease agreements. The Company’s leases may include multiple optional renewal periods that are exercisable solely at the Company’s discretion. Renewal periods are included in the lease term when the Company is reasonably certain that the renewal options would be exercised, and the associated lease payments for such periods are reflected in the ROU asset and lease liability.

The Company’s leases include fixed lease payments which may include escalation terms based on a fixed percentage or may vary based on an inflation index or other market adjustments. Escalations based on changes in inflation indices and market adjustments and other lease costs that vary based on the use of the underlying asset are not included as lease payments in the calculation of the lease liability or ROU asset; such payments are included in variable lease cost when the obligation that triggers the variable payment becomes probable. Variable lease cost includes contingent rent payments for office space based on the percentage occupied by the Company in addition to common area charges and other charges that are variable in nature. The Company also has a component of lease payments that are variable related to the LNG vessels, in which the Company may receive credits based on the performance of the LNG vessels during the period.

As of December 31, 2023 and 2022, ROU assets, current lease liabilities and non-current lease liabilities consisted of the following:

	December 31, 2023		December 31, 2022
Operating right-of-use assets	$	538,055	$	355,883
Finance right-of-use assets (1)	50,330		21,994
Total right-of-use assets	$	588,385	$	377,877
Current lease liabilities:
Operating lease liabilities	$	135,867	$	44,371
Finance lease liabilities	28,681		4,370
Total current lease liabilities	$	164,548	$	48,741
Non-current lease liabilities:
Operating lease liabilities	$	390,519	$	290,899
Finance lease liabilities	15,975		11,222
Total non-current lease liabilities	$	406,494	$	302,121

(1)Finance lease ROU assets are recorded net of accumulated amortization of $21,470 and $2,134 as of December 31, 2023 and 2022, respectively.

For the years ended December 31, 2023, 2022, and 2021, the Company’s operating lease cost recorded within the Consolidated Statements of Operations and Comprehensive Income were as follows:

	Year Ended December 31,
	2023		2022		2021
Fixed lease cost	$	109,873	$	75,771	$	41,054
Variable lease cost	4,601		2,203		1,711
Short-term lease cost	23,903		20,129		6,974
Lease cost - Cost of sales	$	88,608	$	87,610	$	41,147
Lease cost - Operations and maintenance	42,520		3,681		2,343
Lease cost - Selling, general and administrative	7,249		6,812		6,249

For the years ended December 31, 2023, 2022 and 2021, the Company has capitalized $61,320, $20,403 and $15,568 of lease costs, respectively. Capitalized costs include vessels and port space used during the commissioning of development projects. Short-term lease costs for vessels chartered by the Company to transport inventory from a supplier’s facilities to the Company’s storage locations are capitalized to inventory.

The Company has leases of turbines, ISO tanks and a parcel of land that are recognized as finance leases. For the years ended December 31, 2023, 2022 and 2021, the Company’s finance interest expense and amortization recorded in Interest expense and Depreciation and amortization, respectively, within the Consolidated Statements of Operations and Comprehensive Income were as follows:

	Year Ended December 31,
	2023		2022		2021
Interest expense related to finance leases	$	3,706	$	852	$	409
Amortization of right-of-use asset related to finance leases	19,337		1,512		622

Cash paid for operating leases is reported in operating activities in the consolidated statements of cash flows. Supplemental cash flow information related to leases was as follows for the years ended December 31, 2023, 2022 and 2021:

	Year Ended December 31,
	2023		2022		2021
Operating cash outflows for operating lease liabilities	$	133,132	$	96,698	$	46,066
Financing cash outflows for finance lease liabilities	21,187		3,697		2,156
Right-of-use assets obtained in exchange for new operating lease liabilities	265,537		135,075		172,996
Right-of-use assets obtained in exchange for new finance lease liabilities	47,672		—		24,533

The future payments due under operating and finance leases as of December 31, 2023 are as follows:

	Operating Leases		Financing Leases
2024	$	179,273	$	30,939
2025	125,262		12,427
2026	78,023		3,041
2027	77,557		436
2028	76,966		89
Thereafter	174,365		853
Total Lease Payments	$	711,446	$	47,785
Less: effects of discounting	185,060		3,129
Present value of lease liabilities	$	526,386	$	44,656
Current lease liability	$	135,867	$	28,681
Non-current lease liability	390,519		15,975

As of December 31, 2023, the weighted-average remaining lease term for operating leases was 5.9 years and finance leases was 2.0 years. Because the Company generally does not have access to the rate implicit in the lease, the incremental borrowing rate is utilized as the discount rate. The weighted average discount rate associated with operating leases as of December 31, 2023 and 2022 was 10.1% and 8.5%, respectively. The weighted average discount rate associated with finance leases as of December 31, 2023 and 2022 was 8.2% and 5.1%, respectively.

In January 2024, the Company has commenced a 10-year lease of a vessel with expected future payments of approximately $376 million.