Venture Global, Inc.VG
Venture Global, Inc. Revenue Disclosure
Revenue from Contracts with Customers
The Company has entered into numerous contracts for the sale of LNG to third-party customers. LNG produced by our facilities is sold to the Company's customers directly from our projects or through our sales and shipping business on either a FOB, DPU or DES basis. The LNG sales price structure under the Company's sales agreements generally includes (i) a fixed liquefaction fee, a portion of which is subject to an annual adjustment for inflation; (ii) a variable commodity fee equal to at least 115% of Henry Hub per million British thermal units ("MMBtu"); and (iii) a transportation charge, if sold on a DPU basis. Some of the Company's DES sales agreements are structured with a single sales price that includes transportation and is indexed to foreign gas markets, such as Title Transfer Facility index ("TTF") or Japan Korea Marker index ("JKM").
The fixed liquefaction fee component under the Company's LNG sales agreements is the amount owed to the Company regardless of a cancellation or suspension of LNG cargo deliveries by its customers. The variable commodity fee component is the amount generally payable to the Company only upon delivery of LNG. The Company's LNG sales agreements include provisions for contingent payments for non-performance, delays, or other damages, which may be due from the Company, and represent variable consideration. Any estimates for contingent
payments are based on either the Company's best estimate of the most likely outcome or the expected value, depending on which method best predicts the total net consideration to which the Company will be entitled over the term of the LNG sales agreement. Payments, and estimates for contingent payments, made by the Company are recognized as a reduction to the transaction price (as an adjustment to the fixed liquefaction fee) as LNG is delivered to customers over the term of the LNG sales agreement.
Liabilities associated with estimates for contingent payments are limited to any rights to payment from customers (i.e., for satisfied performance obligations) that are in excess of the recognized transaction price until the uncertainty around the obligation, including its value, is resolved. A liability is not recognized for estimates of contingent payments until the earlier of when consideration received from a customer exceeds the transaction price allocated to satisfied performance obligations, or a contingent payment becomes a fixed financial obligation.
LNG produced prior to the relevant project, or phase thereof, reaching COD is sold under short- or mid-term LNG commissioning sales agreements at prevailing market or forward prices when executed. The majority of LNG produced after the relevant project, or phase thereof, reaching COD will be sold under long-term 20-year post-COD SPAs.
On April 15, 2025, the Calcasieu Project declared COD and commenced the sale of LNG to its customers under its post-COD SPAs. The Calcasieu Project post-COD SPAs are delivered on a FOB basis, which means that the title to the LNG transfers at the time customers take delivery at the project's facility.
The following table summarizes the disaggregation of revenue earned from contracts with customers:
| Years ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| LNG revenue | $ | 13,687 | $ | 4,947 | $ | 7,875 | |||||||||||
| Other revenue | 82 | 25 | 22 | ||||||||||||||
| Total revenue | $ | 13,769 | $ | 4,972 | $ | 7,897 | |||||||||||
Transaction price allocated to future performance obligations
Because many of the Company's sales contracts have long-term durations, the Company is contractually entitled to significant future consideration which it has not yet recognized as revenue. The following table discloses the aggregate amount of the transaction price, including variable consideration, that is allocated to performance obligations for legally enforceable sales agreements that have not yet been satisfied, excluding all performance obligations of contracts that have an expected duration of one year or less (dollar amounts in billions):
| December 31, 2025 | |||||||||||
Unsatisfied transaction price(a) | Weighted average recognition timing (in years) | ||||||||||
| LNG revenue | $ | 299.5 | 19.6 years | ||||||||
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(a) A portion of the transaction price is based on the forecasted Henry Hub index as of December 31, 2025.
Significant judgments were made when estimating the transaction price allocated to future performance obligations. These include i) the best estimate of when the Company's respective projects will reach COD and the post-COD SPAs will commence, which is currently expected to occur in 2026 and 2027 for Phases 1 and 2 of the Plaquemines Project, respectively, and 2029 for Phase 1 of the CP2 Project, and ii) reductions to the transaction price to reflect management's best estimate of variable consideration. This variable consideration relates to the four pending disputes with Calcasieu Project post-COD SPA customers who are asserting that the Calcasieu Project was delayed in declaring COD under the respective post-COD SPAs.
In October 2025, a partial final award was issued in the arbitration proceedings with BP Gas Marketing Limited (“BP”). Remedies were not addressed in the partial final award and will be determined in a separate damages hearing. A final award is expected to be issued following the damages portion of the hearing. Based on the terms of the partial final award, the Company does not anticipate that the final award will be subject to the seller aggregate liability limitation in the BP post-COD SPA. The remedies sought by BP include damages ranging from $3.7 billion to potentially in excess of $6.0 billion, as well as interest, costs and attorneys’ fees. The Company believes BP’s theory and calculations of damages are without merit and that the magnitude of damages sought by BP is not recoverable under the express terms of the post-COD SPA, which include express limits on the tribunal’s jurisdictional authority, although there can be no assurance as to the outcome of the damages portion of the hearing.
Three of the Calcasieu Project's other customers are disputing whether the liability limitations in the Company's post-COD SPAs are applicable, and therefore are claiming damages, including amounts in excess of the liability limitations. The Company believes the disputes with these other customers are subject to the aggregate liability limitations of $595 million under the applicable post-COD SPAs.
About Revenue Disclosures
Revenue disclosures under ASC 606 explain how a company identifies performance obligations, allocates transaction prices, and determines when revenue is recognized. This section is essential for understanding whether reported revenue reflects genuine economic activity or aggressive accounting choices. Analysts examine the mix of point-in-time versus over-time recognition, which directly affects revenue timing and comparability.
Key signals: rising contract liabilities (deferred revenue) suggest strong future revenue visibility, while declining contract assets may indicate slowing project milestones. Watch for variable consideration estimates — rebates, returns, and performance bonuses that require management judgment. Significant changes in disaggregated revenue by geography or product line can reveal shifting business mix before it appears in headline numbers. Compare revenue growth against contract liability growth to assess sustainability, and scrutinize any changes in the timing of recognition that coincide with earnings pressure.