DEBT AND CREDIT FACILITIES |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt and Credit Facilities | DEBT AND CREDIT FACILITIES LINES OF CREDIT Primary U.S. Committed Lines of Credit Sempra Energy and Sempra Global On May 17, 2019, Sempra Energy and Sempra Global each entered into a separate five-year credit agreement, both expiring in May 2024. The credit agreements permit borrowings of up to $1.25 billion by Sempra Energy and $3.19 billion by Sempra Global. For both credit facilities, Citibank, N.A. serves as administrative agent for a syndicate of 23 lenders and no single lender has greater than a 6-percent share of either credit facility. The credit agreements supersede Sempra Energy’s $1.25 billion credit agreement and Sempra Global’s $3.19 billion credit agreement, which were both set to expire in 2020. Borrowings for each credit facility bear interest at benchmark rates plus a margin based on Sempra Energy’s credit ratings. California Utilities On May 17, 2019, SDG&E and SoCalGas each entered into a separate five-year credit agreement, both expiring in May 2024. The credit agreements permit borrowings of up to $1.5 billion by SDG&E and $750 million by SoCalGas. For both credit facilities, JPMorgan Chase Bank, N.A. serves as administrative agent for a syndicate of 23 lenders and no single lender has greater than a 6-percent share of either credit facility. The credit agreements replaced the California Utilities’ combined $1 billion credit agreement, which had a maximum of $750 million that could be borrowed by either utility, that was set to expire in 2020. Borrowings for each credit facility bear interest at benchmark rates plus a margin based on the borrowing utility’s credit ratings. At September 30, 2019, these four primary U.S. committed lines of credit permit Sempra Energy Consolidated to borrow an aggregate amount of approximately $6.69 billion. The principal terms of these committed lines of credit, which provide liquidity and support commercial paper, are described below.
Sempra Energy, 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 percent at the end of each quarter. At September 30, 2019, each entity was in compliance with this ratio and all other financial covenants under its respective credit facility. Foreign Committed Lines of Credit In February 2019, IEnova revised the terms of its five-year revolving credit facility by increasing the amount available under the facility from $1.17 billion to $1.50 billion, extending the expiration of the facility from August 2020 to February 2024 and increasing the syndicate of lenders from eight to 10. At September 30, 2019, available unused credit on this line was approximately $642 million. On April 11, 2019, IEnova entered into a three-year, $100 million revolving credit agreement with Scotiabank Inverlat, S.A. Under the agreement, withdrawals may be made for up to one year in either U.S. dollars or Mexican pesos. At September 30, 2019, available unused credit was $100 million. On September 23, 2019, IEnova entered into a two-year, $280 million revolving credit agreement with The Bank of Nova Scotia. Under the agreement, withdrawals may be made for up to two years in U.S. dollars. At September 30, 2019, there was no available unused credit. 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, 2019, we had approximately $648 million in standby letters of credit outstanding under these agreements. WEIGHTED-AVERAGE INTEREST RATES The weighted-average interest rates on total short-term debt at Sempra Energy Consolidated were 2.62 percent and 2.99 percent at September 30, 2019 and December 31, 2018, respectively. The weighted-average interest rate on total short-term debt at SDG&E was 2.97 percent at December 31, 2018. The weighted-average interest rates on total short-term debt at SoCalGas were 2.06 percent and 2.58 percent at September 30, 2019 and December 31, 2018, respectively. LONG-TERM DEBT Sempra Energy In June 2019, we issued $758 million of 5.75-percent, junior subordinated notes maturing in 2079, with a par value of $25 per note. We received proceeds of $735 million (net of underwriting discounts of $23 million). We used the proceeds from the offering to repay outstanding commercial paper and for other general corporate purposes. We may redeem some or all of the notes before their maturity, as follows:
The notes are unsecured obligations and rank junior and subordinate in right of payment to our existing and future senior indebtedness. The notes will rank equally in right of payment with any future unsecured indebtedness that we may incur if the terms of such indebtedness provide that it ranks equally with the notes in right of payment. The notes are effectively subordinated in right of payment to any secured indebtedness that we have or may incur and to all indebtedness and other liabilities of our subsidiaries. SDG&E In May 2019, SDG&E issued $400 million of 4.10-percent, first mortgage bonds maturing in 2049. We received proceeds of $396 million (net of underwriting discounts and debt issuance costs of $4 million). SDG&E used the proceeds from the offering to repay outstanding commercial paper and for other general corporate purposes. As we discuss in “Variable Interest Entities” in Note 1, on August 23, 2019, SDG&E deconsolidated Otay Mesa VIE. Prior to deconsolidation, on August 14, 2019, OMEC LLC paid in full the $211 million outstanding balance on its variable-rate loan that was scheduled to mature in August 2024. We describe this loan agreement and related floating-to-fixed interest rate swaps in Note 7 of the Notes to Consolidated Financial Statements in the Annual Report. We provide additional information concerning the interest rate swaps in Note 8. SoCalGas In June 2019, SoCalGas issued $350 million of 3.95-percent, first mortgage bonds maturing in 2050. We received proceeds of $346 million (net of debt discount, underwriting discounts and debt issuance costs of $4 million). SoCalGas used the proceeds from the offering to repay outstanding commercial paper and for other general corporate purposes. INTEREST RATE SWAPS In February 2019, Sempra Energy entered into floating-to-fixed interest rate swaps to hedge interest payments on the $850 million of variable rate notes issued in October 2017 and maturing in March 2021, resulting in an all-in fixed rate of 3.069 percent. We discuss our interest rate swaps to hedge cash flows in Note 8.
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