----

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

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

|                                                           |                                                |
|----------------------------------------------------------------|-----------------------------------------------------|
| Delaware                                                       | 20-5913059                                          |
| (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
|                                                           |                                                |
| 700 Milam Street, Suite 800Houston, Texas                      | 77002                                               |
| (Address of principal executive offices)                       | (Zip Code)                                          |

|                                                |                                                                                                                                  |
|-----------------------------------------------------|---------------------------------------------------------------------------------------------------------------------------------------|
| Large accelerated filer  ¨           | Accelerated filer                    S |
| Non-accelerated filer    ¨ | Smaller reporting company   ¨                                                                                     |
| (Do not check if a smaller reporting company)       |

----

|         | PART I. FINANCIAL INFORMATION                                                               |   |
|--------------|---------------------------------------------------------------------------------------------|--------|
|         |                                                                                        |   |
| Item 1. | Consolidated Financial Statements                                                           | 1      |
|         | Consolidated Balance Sheets                                                                 | 1      |
|         | Consolidated Statements of Operations                                                       | 2      |
|         | Consolidated Statement of Partners’ Capital (Deficit)                                 | 3      |
|         | Consolidated Statements of Cash Flows                                                       | 4      |
|         | Notes to Consolidated Financial Statements                                                  | 5      |
|         |                                                                                        |   |
| Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 11     |
|         |                                                                                        |   |
| Item 3. | Quantitative and Qualitative Disclosures about Market Risk                                  | 18     |
|         |                                                                                        |   |
| Item 4. | Disclosure Controls and Procedures                                                          | 19     |
|         |                                                                                        |   |
|         | PART II. OTHER INFORMATION                                                                  |   |
|         |                                                                                        |   |
| Item 1. | Legal Proceedings                                                                           | 20     |
|         |                                                                                        |   |
| Item 6. | Exhibits                                                                                    | 20     |

----

|                                                                                                                            |   | March 31,2010 |      |   | December 31,2009 |   |
|---------------------------------------------------------------------------------------------------------------------------------|--------|---------------|-----------|--------|------------------|--------|
|                                                                                                                            |   | (unaudited)   |      |   |             |   |
| ASSETS                                                                                                                          |   |          |      |   |             |   |
| CURRENT ASSETS                                                                                                                  |   |          |      |   |             |   |
| Cash and cash equivalents                                                                                                       |   | $             | 118,405   |   |             | $      | 117,542 |   |
| Restricted cash and cash equivalents                                                                                            |   |          | 54,929    |   |             |   | 13,732 |   |
| Accounts and interest receivable                                                                                                |   |          | 678       |   |             |   | 5,037 |   |
| Accounts receivable—affiliate                                                                                             |   |          | 684       |   |             |   | 3,586 |   |
| Advances to affiliate                                                                                                           |   |          | 1,241     |   |             |   | 5,358 |   |
| Advances to affiliate—LNG inventory                                                                                       |   |          | 783       |   |             |   | 1,319 |   |
| LNG inventory                                                                                                                   |   |          | 216       |   |             |   | 1,521 |   |
| Prepaid expenses and other                                                                                                      |   |          | 8,733     |   |             |   | 4,836 |   |
| TOTAL CURRENT ASSETS                                                                                                            |   |          | 185,669   |   |             |   | 152,931 |   |
|                                                                                                                            |   |          |      |   |             |   |   |   |
| NON-CURRENT RESTRICTED CASH AND CASH EQUIVALENTS                                                                                |   |          | 82,394    |   |             |   | 82,394 |   |
| PROPERTY, PLANT AND EQUIPMENT, NET                                                                                              |   |          | 1,579,286 |   |             |   | 1,588,557 |   |
| DEBT ISSUANCE COSTS, NET                                                                                                        |   |          | 25,846    |   |             |   | 26,953 |   |
| ADVANCES UNDER LONG-TERM CONTRACTS                                                                                              |   |          | —   |   |             |   | 1,021 |   |
| OTHER                                                                                                                           |   |          | 10,023    |   |             |   | 7,617 |   |
| TOTAL ASSETS                                                                                                                    |   | $             | 1,883,218 |   |             | $      | 1,859,473 |   |
|                                                                                                                            |   |          |      |   |             |   |   |   |
| LIABILITIES AND PARTNERS’ DEFICIT                                                                                         |   |          |      |   |             |   |   |   |
| CURRENT LIABILITIES                                                                                                             |   |          |      |   |             |   |   |   |
| Accounts payable                                                                                                                |   | $             | 94        |   |             | $      | 39 |   |
| Accounts payable—affiliate                                                                                                |   |          | 78        |   |             |   | 306 |   |
| Accrued liabilities                                                                                                             |   |          | 56,563    |   |             |   | 22,181 |   |
| Accrued liabilities—affiliate                                                                                             |   |          | 1,329     |   |             |   | 3,095 |   |
| Deferred revenue                                                                                                                |   |          | 26,439    |   |             |   | 26,456 |   |
| Deferred revenue—affiliate                                                                                                |   |          | 63,523    |   |             |   | 63,507 |   |
| TOTAL CURRENT LIABILITIES                                                                                                       |   |          | 148,026   |   |             |   | 115,584 |   |
|                                                                                                                            |   |          |      |   |             |   |   |   |
| LONG-TERM DEBT, NET OF DISCOUNT                                                                                                 |   |          | 2,110,708 |   |             |   | 2,110,101 |   |
| LONG-TERM DEBT—RELATED PARTY, NET OF DISCOUNT                                                                             |   |          | 73,495    |   |             |   | 72,928 |   |
| DEFERRED REVENUE                                                                                                                |   |          | 32,500    |   |             |   | 33,500 |   |
| DEFERRED REVENUE—AFFILIATE                                                                                                |   |          | 9,813     |   |             |   | 7,360 |   |
| OTHER NON-CURRENT LIABILITIES                                                                                                   |   |          | 347       |   |             |   | 327 |   |
| COMMITMENTS AND CONTINGENCIES                                                                                                   |   |          | —   |   |             |   | — |   |
|                                                                                                                            |   |          |      |   |             |   |   |   |
| PARTNERS’ DEFICIT                                                                                                         |   |          |      |   |             |   |   |   |
| Common unitholders (26,416,357 units issued and outstanding at March 31, 2010 and December 31, 2009)                       |   |          | (43,308   | )      |             |   | (41,494 | ) |
| Subordinated unitholders (135,383,831 units issued and outstanding at March 31, 2010 and December 31, 2009)                |   |          | (436,329  | )      |             |   | (427,026 | ) |
| General partner interest (2% interest with 3,302,045 units issued and outstanding at March 31, 2010 and December 31, 2009) |   |          | (12,034   | )      |             |   | (11,807 | ) |
| TOTAL PARTNERS’ DEFICIT                                                                                                   |   |          | (491,671  | )      |             |   | (480,327 | ) |
|                                                                                                                            |   |          |      |   |             |   |   |   |
| TOTAL LIABILITIES AND PARTNERS’ DEFICIT                                                                                   |   | $             | 1,883,218 |   |             | $      | 1,859,473 |   |

----

|                                                                                                                     |   | Three Months EndedMarch 31, |    |
|--------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------|---------|
|                                                                                                                     |   | 2010                        |    |   | 2009 |   |
| REVENUES                                                                                                                 |   |                        |    |   |   |   |
| Revenues                                                                                                                 |   | $                           | 66,827  |   |   | $ | — |   |
| Revenues—affiliate                                                                                                 |   |                        | 63,951  |   |   |   | 62,549 |   |
| TOTAL REVENUES                                                                                                           |   |                        | 130,778 |   |   |   | 62,549 |   |
|                                                                                                                     |   |                        |    |   |   |   |   |   |
| EXPENSES                                                                                                                 |   |                        |    |   |   |   |   |   |
| Operating and maintenance expense                                                                                        |   |                        | 8,074   |   |   |   | 3,947 |   |
| Operating and maintenance expense—affiliate                                                                        |   |                        | 3,065   |   |   |   | 2,610 |   |
| Depreciation expense                                                                                                     |   |                        | 10,563  |   |   |   | 6,649 |   |
| Development expense                                                                                                      |   |                        | 206     |   |   |   | — |   |
| Development expense—affiliate                                                                                      |   |                        | 120     |   |   |   | — |   |
| General and administrative expense                                                                                       |   |                        | 1,740   |   |   |   | 737 |   |
| General and administrative expense—affiliate                                                                       |   |                        | 5,273   |   |   |   | 5,210 |   |
| TOTAL EXPENSES                                                                                                           |   |                        | 29,041  |   |   |   | 19,153 |   |
|                                                                                                                     |   |                        |    |   |   |   |   |   |
| INCOME FROM OPERATIONS                                                                                                   |   |                        | 101,737 |   |   |   | 43,396 |   |
|                                                                                                                     |   |                        |    |   |   |   |   |   |
| OTHER INCOME (EXPENSE)                                                                                                   |   |                        |    |   |   |   |   |   |
| Interest income                                                                                                          |   |                        | 59      |   |   |   | 560 |   |
| Interest expense, net                                                                                                    |   |                        | (43,477 | ) |   |   | (32,929 | ) |
| Interest expense, net—affiliate                                                                                    |   |                        | — |   |   |   | (13 | ) |
| Derivative gain, net                                                                                                     |   |                        | 505     |   |   |   | 2,562 |   |
| Other                                                                                                                    |   |                        | — |   |   |   | 12 |   |
| TOTAL OTHER EXPENSE                                                                                                      |   |                        | (42,913 | ) |   |   | (29,808 | ) |
| NET INCOME                                                                                                               |   | $                           | 58,824  |   |   | $ | 13,588 |   |
|                                                                                                                     |   |                        |    |   |   |   |   |   |
| Allocation of net income:                                                                                                |   |                        |    |   |   |   |   |   |
| Limited partners’ interest                                                                                         |   |                        | 57,648  |   |   |   | 13,316 |   |
| General partner’s interest                                                                                         |   |                        | 1,176   |   |   |   | 272 |   |
| Net income for partners                                                                                                  |   | $                           | 58,824  |   |   | $ | 13,588 |   |
|                                                                                                                     |   |                        |    |   |   |   |   |   |
| Basic and diluted net income per limited partner unit                                                                    |   | $                           | 0.36    |   |   | $ | 0.08 |   |
|                                                                                                                     |   |                        |    |   |   |   |   |   |
| Weighted average number of limited partner units outstanding used for basic and diluted net income per unit calculation: |   |                        |    |   |   |   |   |   |
| Common units                                                                                                             |   |                        | 26,416  |   |   |   | 26,416 |   |
| Subordinated units                                                                                                       |   |                        | 135,384 |   |   |   | 135,384 |   |
|                                                                                                                     |   |                        | 161,800 |   |   |   | 161,800 |   |

----

|                              |   | CommonUnits |    |   | SubordinatedUnits |    |     | General PartnerUnits |   |    | Total   |   |
|-----------------------------------|--------|-------------|---------|--------|-------------------|---------|----------|----------------------|--------|---------|---------|--------|
| Balance at December 31, 2009 |   | $           | (41,494 | )      |              | $       | (427,026 | )                    |   | $       | (11,807 | )      |   | $ | (480,327 | ) |
| Net income                        |   |        | 9,413   |   |              |    | 48,235   |                 |   |    | 1,176   |   |   |   | 58,824 |   |
| Distributions                     |   |        | (11,227 | )      |              |    | (57,538  | )                    |   |    | (1,403  | )      |   |   | (70,168 | ) |
| Balance at March 31, 2010         |   | $           | (43,308 | )      |              |  $ | (436,329 | )                    |   |  $ | (12,034 | )      |   |  $ | (491,671 | ) |

----

|                                                                                                                                 |   | Three Months Ended                                                       |    |
|--------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------------------------------------------------------------|---------|
|                                                                                                                                 |   | March 31,                                                                |    |
|                                                                                                                                 |   |              2010 |    |   |                2009 |   |
| CASH FLOWS FROM OPERATING ACTIVITIES                                                                                                 |   |                                                                     |    |   |   |   |
| Net income                                                                                                                           |   | $                                                                        | 58,824  |   |   | $ | 13,588 |   |
| Adjustments to reconcile net income to net cash provided by (used in) operating activities:                                          |   |                                                                     |    |   |   |   |   |   |
| Depreciation                                                                                                                         |   |                                                                     | 10,563  |   |   |   | 6,649 |   |
| Non-cash derivative (gain) loss                                                                                                      |   |                                                                     | 84      |   |   |   | (270 | ) |
| Amortization of debt issuance costs                                                                                                  |   |                                                                     | 1,107   |   |   |   | 954 |   |
| Amortization of debt discount                                                                                                        |   |                                                                     | 1,174   |   |   |   | 1,174 |   |
| Interest income on restricted cash and cash equivalents                                                                              |   |                                                                     | — |   |   |   | (23 | ) |
| Changes in operating assets and liabilities:                                                                                         |   |                                                                     |    |   |   |   |   |   |
| Accounts and interest receivable                                                                                                     |   |                                                                     | 242     |   |   |   | (182 | ) |
| Accounts receivable—affiliate                                                                                                  |   |                                                                     | 2,901   |   |   |   | (1,218 | )  |
| Accounts payable and accrued liabilities                                                                                             |   |                                                                     | 34,434  |   |   |   | 27,487 |   |
| Accounts payable and accrued liabilities—affiliate                                                                             |   |                                                                     | (1,756  | ) |   |   | 853 |   |
| Advances to affiliate                                                                                                                |   |                                                                     | 4,117   |   |   |   | (1,593 | ) |
| Deferred revenue                                                                                                                     |   |                                                                     | (1,017  | ) |   |   | 10,258 |   |
| Deferred revenue—affiliate                                                                                                     |   |                                                                     | 16      |   |   |   | (193 | ) |
| Other                                                                                                                                |   |                                                                     | (2,090  | ) |   |   | (1,168 | ) |
| NET CASH PROVIDED BY OPERATING ACTIVITIES                                                                                            |   |                                                                     | 108,599 |   |   |   | 56,316 |   |
|                                                                                                                                 |   |                                                                     |    |   |   |   |   |   |
| CASH FLOWS FROM INVESTING ACTIVITIES                                                                                                 |   |                                                                     |    |   |   |   |   |   |
| Use of (investment in) restricted cash and cash equivalents                                                                          |   |                                                                     | (41,197 | ) |   |   | 148,468 |   |
| LNG terminal construction-in-process, net                                                                                            |   |                                                                     | 3,663   |   |   |   | (25,664 | ) |
| Advances under long-term contracts                                                                                                   |   |                                                                     | (34     | ) |   |   | (57 | ) |
| Advances to affiliate—LNG held for commissioning, net of amounts transferred to LNG receiving terminal construction-in-process |   |                                                                     | — |   |   |   | (12,800 | ) |
| NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES                                                                                  |   |                                                                     | (37,568 | ) |   |   | 109,947 |   |
|                                                                                                                                 |   |                                                                     |    |   |   |   |   |   |
| CASH FLOWS FROM FINANCING ACTIVITIES                                                                                                 |   |                                                                     |    |   |   |   |   |   |
| Distribution to unitholders                                                                                                          |   |                                                                     | (70,168 | ) |   |   | (70,169 | ) |
| Borrowings from long-term debt—affiliate                                                                                       |   |                                                                     | — |   |   |   | 114 |   |
| Repayment of long-term debt—affiliate                                                                                          |   |                                                                     | — |   |   |   | (2,467 | ) |
| Affiliate payable                                                                                                                    |   |                                                                     | — |   |   |   | (23 | ) |
| Use of restricted cash and cash equivalents                                                                                          |   |                                                                     | — |   |   |   | 76,218 |   |
| NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES                                                                                  |   |                                                                     | (70,168 | ) |   |   | 3,673 |   |
|                                                                                                                                 |   |                                                                     |    |   |   |   |   |   |
| NET INCREASE IN CASH AND CASH EQUIVALENTS                                                                                            |   |                                                                     | 863     |   |   |   | 169,936 |   |
| CASH AND CASH EQUIVALENTS—beginning of period                                                                                  |   |                                                                     | 117,542 |   |   |   | 7 |   |
|                                                                                                                                 |   |                                                                     |    |   |   |   |   |   |
| CASH AND CASH EQUIVALENTS—end of period                                                                                        |   | $                                                                        | 118,405 |   |   | $ | 169,943 |   |

----

----

|                                           |   | March 31,2010 |      |   | December 31,2009 |   |
|------------------------------------------------|--------|---------------|-----------|--------|------------------|--------|
| LNG TERMINAL COSTS                             |   |          |      |   |             |   |
| LNG receiving terminal                         |   | $             | 1,627,957 |   |             | $      | 1,627,564 |   |
| LNG receiving terminal construction-in-process |   |          | 866       |   |             |   | — |   |
| LNG site and related costs, net                |   |          | 175       |   |             |   | 176 |   |
| Accumulated depreciation                       |   |          | (50,394   | )      |             |   | (39,975 | ) |
| Total LNG receiving terminal costs             |   |          | 1,578,604 |   |             |   | 1,587,765 |   |
| FIXED ASSETS                                   |   |          |      |   |             |   |   |   |
| Computer and office equipment                  |   |          | 282       |   |             |   | 259 |   |
| Vehicles                                       |   |          | 421       |   |             |   | 421 |   |
| Machinery and equipment                        |   |          | 934       |   |             |   | 931 |   |
| Other                                          |   |          | 426       |   |             |   | 419 |   |
| Accumulated depreciation                       |   |          | (1,381    | )      |             |   | (1,238 | ) |
| Total fixed assets, net                        |   |          | 682       |   |             |   | 792 |   |
| PROPERTY, PLANT AND EQUIPMENT, NET             |   | $             | 1,579,286 |   |             | $      | 1,588,557 |   |

|                                          |   | March 31,2010 |   |   | December 31,2009 |   |
|-----------------------------------------------|--------|---------------|--------|--------|------------------|--------|
| Interest and related debt fees                |   | $             | 55,349 |   |             | $      | 14,152 |   |
| LNG terminal construction and operating costs |   |          | 1,010  |   |             |   | 7,850 |   |
| Affiliate                                     |   |          | 1,329  |   |             |   | 3,095 |   |
| Other                                         |   |          | 204    |   |             |   | 179 |   |
| Total accrued liabilities                     |   | $             | 57,892 |   |             | $      | 25,276 |   |

----

|                                              |   | March 31,2010 |      |   | December 31,2009 |   |
|---------------------------------------------------|--------|---------------|-----------|--------|------------------|--------|
| Senior Notes, net of discount                     |   | $             | 2,110,708 |   |             | $      | 2,110,101 |   |
| Senior Notes, net of discount—related party |   |          | 73,495    |   |             |   | 72,928 |   |
| Total long-term debt, net of discount             |   | $             | 2,184,203 |   |             | $      | 2,183,029 |   |

----

|              |   | Quoted Prices in Active Markets for Identical Instruments(Level 1) |   |   | Significant Other Observable Inputs (Level 2) |   |    | Significant Unobservable Inputs (Level 3) |   |   | Total Carrying Value atMarch 31,2010 |   |
|-------------------|--------|--------------------------------------------------------------------|--------|--------|----------------------------------------------------|--------|---------|------------------------------------------------|--------|--------|--------------------------------------|--------|
| Derivatives asset |   | $                                                                  | 39     |   |                                               | $      | — |                                           |   | $      | —                              |   |   | $ | 39 |   |

|                            | March 31, 2010 |   | December 31, 2009   |   |
|---------------------------------|----------------|--------|---------------------|--------|
|                            | CarryingAmount |   | EstimatedFair Value |   | CarryingAmount |   | EstimatedFair Value |   |
| 2013 Notes (1)                  |           | $      | 550,000             |   |   | $ | 517,000 |   |   | $ | 550,000 |   |   | $ | 503,250 |   |
| 2016 Notes, net of discount (1) |           |   | 1,634,203           |   |   |   | 1,442,184 |   |   |   | 1,633,029 |   |   |   | 1,371,744 |   |

----

| (1) | The fair value of the Senior Notes was based on quotations obtained from broker-dealers who made markets in these and similar instruments as of March 31, 2010 and December 31, 2009, as applicable. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

|                                                                                | Three Months EndedMarch 31, |   |
|-------------------------------------------------------------------------------------|-----------------------------|--------|
|                                                                                | 2010                        |   | 2009 |   |
| Cash paid for interest, net of amounts capitalized                                  |                        | $      | — |   |   | $ | — |   |
| Construction-in-process and debt issuance additions funded with accrued liabilities |                        |   | 28 |   |   |   | 60,504 |   |

----

| Item 2. | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
|--------------|---------------------------------------------------------------------------------------------|

|   | • | statements regarding our ability to pay distributions to our unitholders; |
|--------|---------|---------------------------------------------------------------------------|

|   | • | our expected receipt of cash distributions from Sabine Pass LNG, L.P. (“Sabine Pass LNG”); |
|--------|---------|--------------------------------------------------------------------------------------------------------|

|   | • | statements regarding future levels of domestic natural gas production, supply or consumption; future levels of liquefied natural gas (“LNG”) imports into North America; sales of natural gas in North America; and the transportation, other infrastructure or prices related to natural gas, LNG or other energy sources; |
|--------|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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

|   | • | statements regarding any terminal use agreement (“TUA”) or other agreements to be entered into or performed substantially in the future, including any cash distributions and revenues anticipated to be received and the anticipated timing thereof, and statements regarding the amounts of total LNG regasification or storage capacity that are, or may become, subject to TUAs or other contracts; |
|--------|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • | statements regarding counterparties to our TUAs, construction contracts and other contracts; |
|--------|---------|----------------------------------------------------------------------------------------------|

|   | • | statements regarding any business strategy, any business plans or any other plans, forecasts, projections or objectives, any or all of which are subject to change; |
|--------|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • | statements regarding legislative, governmental, regulatory, administrative or other public body actions, requirements, permits, investigations, proceedings or decisions; and |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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

----

|   | • | Overview of Business |
|--------|---------|----------------------|

|   | • | Liquidity and Capital Resources |
|--------|---------|---------------------------------|

|   | • | Results of Operations |
|--------|---------|-----------------------|

|   | • | Off-Balance Sheet Arrangements |
|--------|---------|--------------------------------|

|   | • | Summary of Critical Accounting Policies |
|--------|---------|-----------------------------------------|

|   | • | Recent Accounting Standards |
|--------|---------|-----------------------------|

----

|   | • | Total has reserved approximately 1.0 Bcf/d of regasification capacity and has agreed to make monthly capacity payments to Sabine Pass LNG aggregating approximately $125 million per year for 20 years that commenced on April 1, 2009. Total, S.A. has guaranteed Total’s obligations under its TUA up to $2.5 billion, subject to certain exceptions; and |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • | Chevron has reserved approximately 1.0 Bcf/d of regasification capacity and has agreed to make monthly capacity payments to Sabine Pass LNG aggregating approximately $125 million per year for 20 years that commenced on July 1, 2009. Chevron Corporation has guaranteed Chevron’s obligations under its TUA up to 80% of the fees payable by Chevron. |
|--------|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                                                                                                 |   | Three Months Ended March 31, |     |
|--------------------------------------------------------------------------------------------------------------------------------------|--------|------------------------------|----------|
|                                                                                                                                 |   |   2010                  |     |   |     2009 |   |
| SOURCES OF CASH AND CASH EQUIVALENTS                                                                                                 |   |                         |     |   |   |   |
| Operating cash flow                                                                                                                  |   | $                            | 108,599  |   |   | $ | 56,316 |   |
| Use of restricted cash and cash equivalents                                                                                          |   |                         | —  |   |   |   | 224,686 |   |
| LNG receiving terminal construction-in-process, net                                                                                  |   |                         | 3,663    |   |   |   | — |   |
| Borrowings under long-term note—affiliate                                                                                      |   |                         | —  |   |   |   | 114 |   |
| Other                                                                                                                                |   |                         | —  |   |   |   | — |   |
| Total sources of cash and cash equivalents                                                                                           |   |                         | 112,262  |   |   |   | 281,116 |   |
|                                                                                                                                 |   |                         |     |   |   |   |   |   |
| USES OF CASH AND CASH EQUIVALENTS                                                                                                    |   |                         |     |   |   |   |   |   |
| Distributions to owners                                                                                                              |   |                         | (70,168  | ) |   |   | (70,169 | ) |
| Investment in restricted cash and cash equivalents                                                                                   |   |                         | (41,197  | ) |   |   | — |   |
| LNG receiving terminal construction-in-process, net                                                                                  |   |                         | —  |   |   |   | (25,664 | ) |
| Advances to affiliate—LNG held for commissioning, net of amounts transferred to LNG receiving terminal construction-in-process |   |                         | —  |   |   |   | (12,800 | ) |
| Repayment of long-term debt—affiliate                                                                                          |   |                         | —  |   |   |   | (2,467 | ) |
| Other                                                                                                                                |   |                         | (34      | ) |   |   | (80 | ) |
| Total uses of cash and cash equivalents                                                                                              |   |                         | (111,399 | ) |   |   | (111,180 | ) |
|                                                                                                                                 |   |                         |     |   |   |   |   |   |
| NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                                                                                 |   |                         | 863      |   |   |   | 169,936 |   |
| CASH AND CASH EQUIVALENTS—beginning of period                                                                                  |   |                         | 117,542  |   |   |   | 7 |   |
| CASH AND CASH EQUIVALENTS—end of period                                                                                        |   | $                            | 118,405  |   |   | $ | 169,943 |   |

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|              |                                |                  |   | Total Distribution (in thousands) |   |
|-------------------|-------------------------------------|-----------------------|--------|-----------------------------------|--------|
| Date Paid         | Period Covered by Distribution      | Distribution Per Unit |   | Common and General Partner Units  |   | Subordinated Units |   |
| February 12, 2010 | October 1 – December 31, 2009 |                  | $      | 0.425                             |   |   | $ | 12,630 |   |   | $ | 57,538 |   |

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| Item 3. | Quantitative and Qualitative Disclosures about Market Risk |
|--------------|------------------------------------------------------------|

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| Item 4. | Disclosure Controls and Procedures |
|--------------|------------------------------------|

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| Item 1. | Legal Proceedings |
|--------------|-------------------|

| Item 6. | Exhibits |
|--------------|----------|

|   |                                                                                                                                                                                                                                                                                     |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 10.1   | Surrender of Capacity Rights Agreement, dated March 26, 2010, by and between Cheniere Marketing, LLC and Sabine Pass LNG, L.P. (Incorporated by reference to Exhibit 10.1 to Cheniere Energy, Inc.’s Current Report on Form 8-K (SEC File No. 001-16383), filed on March 31, 2010) |
|   |                                                                                                                                                                                                                                                                                     |
| 10.2   | Capacity Rights Agreement, dated March 26, 2010, by and between Sabine Pass LNG, L.P. and JPMorgan LNG Co. (Incorporated by reference to Exhibit 10.2 to Cheniere Energy, Inc.’s Current Report on Form 8-K (SEC File No. 001-16383), filed on March 31, 2010)                     |
|   |                                                                                                                                                                                                                                                                                     |
| 10.3   | Tri-Party Agreement, dated March 26, 2010, by and among Cheniere Marketing, LLC, Sabine Pass LNG, L.P. and JPMorgan LNG Co. (Incorporated by reference to Exhibit 10.3 to Cheniere Energy, Inc.’s Current Report on Form 8-K (SEC File No. 001-16383), filed on March 31, 2010)    |
|   |                                                                                                                                                                                                                                                                                     |
| 10.4   | LNG Services Agreement, dated March 26, 2010, by and between Cheniere Marketing, LLC and JPMorgan LNG Co. (Incorporated by reference to Exhibit 10.4 to Cheniere Energy, Inc.’s Current Report on Form 8-K (SEC File No. 001-16383), filed on March 31, 2010)                      |
|   |                                                                                                                                                                                                                                                                                     |
| 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 of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002                                                                                                                              |

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| CHENIERE ENERGY PARTNERS, L.P. |
|--------------------------------|
|                           |   |
| By:                            | Cheniere Energy Partners GP, LLC,its general partner |
|                           |   |
| By:                            | /s/    Jerry D. Smith |
|                           | Jerry D. SmithChief Accounting Officer (on behalf of the registrant and as principal accounting officer) |
|                           |   |
| Date:                          | May 6, 2010 |
|                           |   |

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