Delaware |
76-0568219 |
|
(State or Other Jurisdiction of Incorporation or Organization) |
(I.R.S. Employer Identification No.) |
1100 Louisiana Street, 10th Floor |
Houston, Texas 77002 |
(Address of Principal Executive Offices, including Zip Code) |
(713) 381-6500 |
(Registrant’s Telephone Number, including Area Code) |
Title of Each Class |
Trading Symbol(s) |
Name of Each Exchange On Which Registered |
Common Units |
EPD |
New York Stock Exchange |
Large Accelerated Filer ☑ |
Accelerated filer ☐ |
Non-accelerated filer ☐ |
Smaller reporting company ☐ |
Emerging growth company ☐ |
Page No. |
||
June 30, 2022 |
December 31, 2021 |
|||||||
ASSETS |
||||||||
Current assets: |
||||||||
Cash and cash equivalents |
$ |
231 |
$ |
2,820 |
||||
Restricted cash |
166 |
145 |
||||||
Accounts receivable – trade, net of allowance for credit losses of $54 at June 30, 2022 and $53 at December 31, 2021 |
8,421 |
6,967 |
||||||
Accounts receivable – related parties |
29 |
21 |
||||||
Inventories (see Note 3) |
3,234 |
2,681 |
||||||
Derivative assets (see Note 14) |
332 |
237 |
||||||
Prepaid and other current assets |
548 |
399 |
||||||
Total current assets |
12,961 |
13,270 |
||||||
Property, plant and equipment, net (see Note 4) |
44,129 |
42,088 |
||||||
Investments in unconsolidated affiliates (see Note 5) |
2,374 |
2,428 |
||||||
Intangible assets, net (see Note 6) |
4,056 |
3,151 |
||||||
Goodwill (see Note 6) |
5,608 |
5,449 |
||||||
Other assets |
1,222 |
1,140 |
||||||
Total assets |
$ |
70,350 |
$ |
67,526 |
||||
LIABILITIES AND EQUITY |
||||||||
Current liabilities: |
||||||||
Current maturities of debt (see Note 7) |
$ |
1,889 |
$ |
1,400 |
||||
Accounts payable – trade |
803 |
632 |
||||||
Accounts payable – related parties |
132 |
167 |
||||||
Accrued product payables |
10,815 |
8,093 |
||||||
Accrued interest |
435 |
453 |
||||||
Derivative liabilities (see Note 14) |
345 |
254 |
||||||
Other current liabilities |
559 |
626 |
||||||
Total current liabilities |
14,978 |
11,625 |
||||||
Long-term debt (see Note 7) |
26,892 |
28,135 |
||||||
Deferred tax liabilities (see Note 16) |
556 |
518 |
||||||
Other long-term liabilities |
898 |
760 |
||||||
Commitments and contingent liabilities (see Note 17) |
||||||||
Redeemable preferred limited partner interests: (see Note 8) |
||||||||
Series A cumulative convertible preferred units (“preferred units”) (50,412 units outstanding at June 30, 2022 and December 31, 2021) |
49 |
49 |
||||||
Equity: (see Note 8) |
||||||||
Partners’ equity: |
||||||||
Common limited partner interests (2,179,249,380 units issued and outstanding at June 30, 2022, 2,176,379,587 units issued and outstanding at December 31, 2021) |
27,003 |
26,340 |
||||||
Treasury units, at cost |
(1,297 |
) |
(1,297 |
) |
||||
Accumulated other comprehensive income |
177 |
286 |
||||||
Total partners’ equity |
25,883 |
25,329 |
||||||
Noncontrolling interests in consolidated subsidiaries |
1,094 |
1,110 |
||||||
Total equity |
26,977 |
26,439 |
||||||
Total liabilities, preferred units, and equity |
$ |
70,350 |
$ |
67,526 |
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||
2022 |
2021 |
2022 |
2021 |
|||||||||||||
Revenues: |
||||||||||||||||
Third parties |
$ |
16,041 |
$ |
9,441 |
$ |
29,033 |
$ |
18,582 |
||||||||
Related parties |
19 |
9 |
35 |
23 |
||||||||||||
Total revenues (see Note 9) |
16,060 |
9,450 |
29,068 |
18,605 |
||||||||||||
Costs and expenses: |
||||||||||||||||
Operating costs and expenses: |
||||||||||||||||
Third party and other costs |
14,004 |
7,767 |
25,086 |
14,996 |
||||||||||||
Related parties |
337 |
300 |
652 |
624 |
||||||||||||
Total operating costs and expenses |
14,341 |
8,067 |
25,738 |
15,620 |
||||||||||||
General and administrative costs: |
||||||||||||||||
Third party and other costs |
24 |
19 |
49 |
40 |
||||||||||||
Related parties |
38 |
33 |
75 |
68 |
||||||||||||
Total general and administrative costs |
62 |
52 |
124 |
108 |
||||||||||||
Total costs and expenses (see Note 10) |
14,403 |
8,119 |
25,862 |
15,728 |
||||||||||||
Equity in income of unconsolidated affiliates |
107 |
161 |
224 |
310 |
||||||||||||
Operating income |
1,764 |
1,492 |
3,430 |
3,187 |
||||||||||||
Other income (expense): |
||||||||||||||||
Interest expense |
(309 |
) |
(316 |
) |
(628 |
) |
(639 |
) |
||||||||
Interest income |
2 |
1 |
3 |
2 |
||||||||||||
Other, net |
– |
– |
2 |
– |
||||||||||||
Total other expense, net |
(307 |
) |
(315 |
) |
(623 |
) |
(637 |
) |
||||||||
Income before income taxes |
1,457 |
1,177 |
2,807 |
2,550 |
||||||||||||
Provision for income taxes (see Note 16) |
(17 |
) |
(31 |
) |
(36 |
) |
(41 |
) |
||||||||
Net income |
1,440 |
1,146 |
2,771 |
2,509 |
||||||||||||
Net income attributable to noncontrolling interests |
(28 |
) |
(33 |
) |
(62 |
) |
(54 |
) |
||||||||
Net income attributable to preferred units |
(1 |
) |
(1 |
) |
(2 |
) |
(2 |
) |
||||||||
Net income attributable to common unitholders |
$ |
1,411 |
$ |
1,112 |
$ |
2,707 |
$ |
2,453 |
||||||||
Earnings per unit: (see Note 11) |
||||||||||||||||
Basic and diluted earnings per common unit |
$ |
0.64 |
$ |
0.50 |
$ |
1.23 |
$ |
1.11 |
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||
2022 |
2021 |
2022 |
2021 |
|||||||||||||
Net income |
$ |
1,440 |
$ |
1,146 |
$ |
2,771 |
$ |
2,509 |
||||||||
Other comprehensive income (loss): |
||||||||||||||||
Cash flow hedges: (see Note 14) |
||||||||||||||||
Commodity hedging derivative instruments: |
||||||||||||||||
Changes in fair value of cash flow hedges |
39 |
(291 |
) |
(60 |
) |
(752 |
) |
|||||||||
Reclassification of losses (gains) to net income |
(108 |
) |
(99 |
) |
(63 |
) |
517 |
|||||||||
Interest rate hedging derivative instruments: |
||||||||||||||||
Changes in fair value of cash flow hedges |
– |
– |
– |
183 |
||||||||||||
Reclassification of losses to net income |
6 |
10 |
14 |
18 |
||||||||||||
Total cash flow hedges |
(63 |
) |
(380 |
) |
(109 |
) |
(34 |
) |
||||||||
Total other comprehensive loss |
(63 |
) |
(380 |
) |
(109 |
) |
(34 |
) |
||||||||
Comprehensive income |
1,377 |
766 |
2,662 |
2,475 |
||||||||||||
Comprehensive income attributable to noncontrolling interests |
(28 |
) |
(33 |
) |
(62 |
) |
(54 |
) |
||||||||
Comprehensive income attributable to preferred units |
(1 |
) |
(1 |
) |
(2 |
) |
(2 |
) |
||||||||
Comprehensive income attributable to common unitholders |
$ |
1,348 |
$ |
732 |
$ |
2,598 |
$ |
2,419 |
For the Six Months Ended June 30, |
||||||||
2022 |
2021 |
|||||||
Operating activities: |
||||||||
Net income |
$ |
2,771 |
$ |
2,509 |
||||
Reconciliation of net income to net cash flows provided by operating activities: |
||||||||
Depreciation and accretion |
891 |
852 |
||||||
Amortization of intangible assets |
86 |
74 |
||||||
Amortization of major maintenance costs for reaction-based plants |
25 |
10 |
||||||
Other amortization expense |
115 |
123 |
||||||
Impairment of assets other than goodwill |
19 |
84 |
||||||
Equity in income of unconsolidated affiliates |
(224 |
) |
(310 |
) |
||||
Distributions received from unconsolidated affiliates attributable to earnings |
224 |
262 |
||||||
Net losses attributable to asset sales and related matters |
2 |
11 |
||||||
Deferred income tax expense |
16 |
24 |
||||||
Change in fair market value of derivative instruments |
94 |
(39 |
) |
|||||
Non-cash expense related to long-term operating leases (see Note 17) |
27 |
19 |
||||||
Net effect of changes in operating accounts (see Note 18) |
218 |
399 |
||||||
Other operating activities |
– |
(1 |
) |
|||||
Net cash flows provided by operating activities |
4,264 |
4,017 |
||||||
Investing activities: |
||||||||
Capital expenditures |
(731 |
) |
(1,301 |
) |
||||
Cash used for business combinations, net of cash received (See Note 12) |
(3,204 |
) |
– |
|||||
Investments in unconsolidated affiliates |
– |
(1 |
) |
|||||
Distributions received from unconsolidated affiliates attributable to the return of capital |
55 |
37 |
||||||
Proceeds from asset sales |
14 |
50 |
||||||
Other investing activities |
(2 |
) |
(14 |
) |
||||
Cash used in investing activities |
(3,868 |
) |
(1,229 |
) |
||||
Financing activities: |
||||||||
Borrowings under debt agreements |
42,112 |
9,797 |
||||||
Repayments of debt |
(42,872 |
) |
(11,122 |
) |
||||
Monetization of interest rate derivative instruments |
– |
75 |
||||||
Cash distributions paid to common unitholders (see Note 8) |
(2,026 |
) |
(1,965 |
) |
||||
Cash payments made in connection with distribution equivalent rights |
(17 |
) |
(15 |
) |
||||
Cash distributions paid to noncontrolling interests |
(82 |
) |
(71 |
) |
||||
Cash contributions from noncontrolling interests |
4 |
18 |
||||||
Repurchase of common units under 2019 Buyback Program |
(35 |
) |
(14 |
) |
||||
Other financing activities |
(48 |
) |
(38 |
) |
||||
Cash used in financing activities |
(2,964 |
) |
(3,335 |
) |
||||
Net change in cash and cash equivalents, including restricted cash |
(2,568 |
) |
(547 |
) |
||||
Cash and cash equivalents, including restricted cash, at beginning of period |
2,965 |
1,158 |
||||||
Cash and cash equivalents, including restricted cash, at end of period |
$ |
397 |
$ |
611 |
Partners’ Equity |
||||||||||||||||||||
Common Limited Partner Interests |
Treasury Units |
Accumulated Other Comprehensive Income (Loss) |
Noncontrolling Interests in Consolidated Subsidiaries |
Total |
||||||||||||||||
For the Three Months Ended June 30, 2022: |
||||||||||||||||||||
Balance, March 31, 2022 |
$ |
26,610 |
$ |
(1,297 |
) |
$ |
240 |
$ |
1,104 |
$ |
26,657 |
|||||||||
Net income |
1,411 |
– |
– |
28 |
1,439 |
|||||||||||||||
Cash distributions paid to common unitholders |
(1,014 |
) |
– |
– |
– |
(1,014 |
) |
|||||||||||||
Cash payments made in connection with distribution equivalent rights |
(9 |
) |
– |
– |
– |
(9 |
) |
|||||||||||||
Cash distributions paid to noncontrolling interests |
– |
– |
– |
(40 |
) |
(40 |
) |
|||||||||||||
Cash contributions from noncontrolling interests |
– |
– |
– |
2 |
2 |
|||||||||||||||
Amortization of fair value of equity-based awards |
41 |
– |
– |
– |
41 |
|||||||||||||||
Repurchase and cancellation of common units under 2019 Buyback Program |
(35 |
) |
– |
– |
– |
(35 |
) |
|||||||||||||
Cash flow hedges |
– |
– |
(63 |
) |
– |
(63 |
) |
|||||||||||||
Other, net |
(1 |
) |
– |
– |
– |
(1 |
) |
|||||||||||||
Balance, June 30, 2022 |
$ |
27,003 |
$ |
(1,297 |
) |
$ |
177 |
$ |
1,094 |
$ |
26,977 |
Partners’ Equity |
||||||||||||||||||||
Common Limited Partner Interests |
Treasury Units |
Accumulated Other Comprehensive Income (Loss) |
Noncontrolling Interests in Consolidated Subsidiaries |
Total |
||||||||||||||||
For the Six Months Ended June 30, 2022: |
||||||||||||||||||||
Balance, December 31, 2021 |
$ |
26,340 |
$ |
(1,297 |
) |
$ |
286 |
$ |
1,110 |
$ |
26,439 |
|||||||||
Net income |
2,707 |
– |
– |
62 |
2,769 |
|||||||||||||||
Cash distributions paid to common unitholders |
(2,026 |
) |
– |
– |
– |
(2,026 |
) |
|||||||||||||
Cash payments made in connection with distribution equivalent rights |
(17 |
) |
– |
– |
– |
(17 |
) |
|||||||||||||
Cash distributions paid to noncontrolling interests |
– |
– |
– |
(82 |
) |
(82 |
) |
|||||||||||||
Cash contributions from noncontrolling interests |
– |
– |
– |
4 |
4 |
|||||||||||||||
Amortization of fair value of equity-based awards |
79 |
– |
– |
– |
79 |
|||||||||||||||
Repurchase and cancellation of common units under 2019 Buyback Program |
(35 |
) |
– |
– |
– |
(35 |
) |
|||||||||||||
Cash flow hedges |
– |
– |
(109 |
) |
– |
(109 |
) |
|||||||||||||
Other, net |
(45 |
) |
– |
– |
– |
(45 |
) |
|||||||||||||
Balance, June 30, 2022 |
$ |
27,003 |
$ |
(1,297 |
) |
$ |
177 |
$ |
1,094 |
$ |
26,977 |
Partners’ Equity |
||||||||||||||||||||
Common Limited Partner Interests |
Treasury Units |
Accumulated Other Comprehensive Income (Loss) |
Noncontrolling Interests in Consolidated Subsidiaries |
Total |
||||||||||||||||
For the Three Months Ended June 30, 2021: |
||||||||||||||||||||
Balance, March 31, 2021 |
$ |
26,109 |
$ |
(1,297 |
) |
$ |
181 |
$ |
1,078 |
$ |
26,071 |
|||||||||
Net income |
1,112 |
– |
– |
33 |
1,145 |
|||||||||||||||
Cash distributions paid to common unitholders |
(983 |
) |
– |
– |
– |
(983 |
) |
|||||||||||||
Cash payments made in connection with distribution equivalent rights |
(8 |
) |
– |
– |
– |
(8 |
) |
|||||||||||||
Cash distributions paid to noncontrolling interests |
– |
– |
– |
(41 |
) |
(41 |
) |
|||||||||||||
Cash contributions from noncontrolling interests |
– |
– |
– |
5 |
5 |
|||||||||||||||
Amortization of fair value of equity-based awards |
41 |
– |
– |
– |
41 |
|||||||||||||||
Cash flow hedges |
– |
– |
(380 |
) |
– |
(380 |
) |
|||||||||||||
Other, net |
(2 |
) |
– |
– |
(1 |
) |
(3 |
) |
||||||||||||
Balance, June 30, 2021 |
$ |
26,269 |
$ |
(1,297 |
) |
$ |
(199 |
) |
$ |
1,074 |
$ |
25,847 |
Partners’ Equity |
||||||||||||||||||||
Common Limited Partner Interests |
Treasury Units |
Accumulated Other Comprehensive Income (Loss) |
Noncontrolling Interests in Consolidated Subsidiaries |
Total |
||||||||||||||||
For the Six Months Ended June 30, 2021: |
||||||||||||||||||||
Balance, December 31, 2020 |
$ |
25,767 |
$ |
(1,297 |
) |
$ |
(165 |
) |
$ |
1,073 |
$ |
25,378 |
||||||||
Net income |
2,453 |
– |
– |
54 |
2,507 |
|||||||||||||||
Cash distributions paid to common unitholders |
(1,965 |
) |
– |
– |
– |
(1,965 |
) |
|||||||||||||
Cash payments made in connection with distribution equivalent rights |
(15 |
) |
– |
– |
– |
(15 |
) |
|||||||||||||
Cash distributions paid to noncontrolling interests |
– |
– |
– |
(71 |
) |
(71 |
) |
|||||||||||||
Cash contributions from noncontrolling interests |
– |
– |
– |
18 |
18 |
|||||||||||||||
Amortization of fair value of equity-based awards |
79 |
– |
– |
– |
79 |
|||||||||||||||
Repurchase and cancellation of common units under 2019 Buyback Program |
(14 |
) |
– |
– |
– |
(14 |
) |
|||||||||||||
Cash flow hedges |
– |
– |
(34 |
) |
– |
(34 |
) |
|||||||||||||
Other, net |
(36 |
) |
– |
– |
– |
(36 |
) |
|||||||||||||
Balance, June 30, 2021 |
$ |
26,269 |
$ |
(1,297 |
) |
$ |
(199 |
) |
$ |
1,074 |
$ |
25,847 |
• | natural gas gathering, treating, processing, transportation and storage; |
• | NGL transportation, fractionation, storage, and marine terminals (including those used to export liquefied petroleum gases, or “LPG,” and ethane); |
• | crude oil gathering, transportation, storage, and marine terminals; |
• | propylene production facilities (including propane dehydrogenation (“PDH”) facilities), butane isomerization, octane enhancement, isobutane dehydrogenation (“iBDH”) and high purity isobutylene (“HPIB”) production facilities; |
• | petrochemical and refined products transportation, storage, and marine terminals (including those used to export ethylene and polymer grade propylene (“PGP”)); and |
• | a marine transportation business that operates on key U.S. inland and intracoastal waterway systems. |
Allowance for credit losses, December 31, 2021 |
$ |
53 |
||
Charged to costs and expenses |
4 |
|||
Charged to other accounts |
1 |
|||
Deductions |
(4 |
) |
||
Allowance for credit losses, June 30, 2022 |
$ |
54 |
June 30, 2022 |
December 31, 2021 |
|||||||
Cash and cash equivalents |
$ |
231 |
$ |
2,820 |
||||
Restricted cash |
166 |
145 |
||||||
Total cash, cash equivalents and restricted cash shown in the Unaudited Condensed Statements of Consolidated Cash Flows |
$ |
397 |
$ |
2,965 |
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||
2022 |
2021 |
2022 |
2021 |
|||||||||||||
Cost of sales (1) |
$ |
12,908 |
$ |
6,840 |
$ |
23,006 |
$ |
13,103 |
||||||||
Lower of cost or net realizable value adjustments recognized in cost of sales |
3 |
3 |
7 |
13 |
(1) |
Cost of sales is a component of “Operating costs and expenses” as presented on our Unaudited Condensed Statements of Consolidated Operations. Fluctuations in these amounts are primarily due to changes in energy commodity prices and sales volumes associated with our marketing activities. |
Estimated Useful Life in Years |
June 30, 2022 |
December 31, 2021 |
||||||||||
Plants, pipelines and facilities (1) |
3-45 |
(5) |
$ |
53,912 |
$ |
51,636 |
||||||
Underground and other storage facilities (2) |
5-40 |
(6) |
4,335 |
4,327 |
||||||||
Transportation equipment (3) |
3-10 |
218 |
209 |
|||||||||
Marine vessels (4) |
15-30 |
922 |
918 |
|||||||||
Land |
387 |
379 |
||||||||||
Construction in progress |
2,213 |
1,616 |
||||||||||
Subtotal |
61,987 |
59,085 |
||||||||||
Less accumulated depreciation |
17,933 |
17,083 |
||||||||||
Subtotal property, plant and equipment, net |
44,054 |
42,002 |
||||||||||
Capitalized major maintenance costs for reaction-based plants, net of accumulated amortization (7) |
75 |
86 |
||||||||||
Property, plant and equipment, net |
$ |
44,129 |
$ |
42,088 |
(1) |
Plants, pipelines and facilities include processing plants; NGL, natural gas, crude oil and petrochemical and refined products pipelines; terminal loading and unloading facilities; buildings; office furniture and equipment; laboratory and shop equipment and related assets. |
(2) |
Underground and other storage facilities include underground product storage caverns; above ground storage tanks; water wells and related assets. |
(3) |
Transportation equipment includes tractor-trailer tank trucks and other vehicles and similar assets used in our operations. |
(4) |
Marine vessels include tow boats, barges and related equipment used in our marine transportation business. |
(5) |
In general, the estimated useful lives of major assets within this category are: processing plants, 20-35 years; pipelines and related equipment, 5-45 years; terminal facilities, 10-35 years; buildings, 20-40 years; office furniture and equipment, 3-20 years; and laboratory and shop equipment, 5-35 years. |
(6) |
In general, the estimated useful lives of assets within this category are: underground storage facilities, 5-35 years; storage tanks, 10-40 years; and water wells, 5-35 years. |
(7) |
For reaction-based plants, we use the deferral method when accounting for major maintenance activities. Under the deferral method, major maintenance costs are capitalized and amortized over the period until the next major overhaul project. On a weighted-average basis, the expected amortization period for these costs is 1.8 years. |
ARO liability balance, December 31, 2021 |
$ |
176 |
||
Liabilities incurred (1) |
14 |
|||
Revisions in estimated cash flows (2) |
23 |
|||
Liabilities settled (3) |
(2 |
) |
||
Accretion expense (4) |
8 |
|||
ARO liability balance, June 30, 2022 |
$ |
219 |
(1) |
Represents the initial recognition of estimated ARO liabilities during period. |
(2) |
Represents subsequent adjustments to estimated ARO liabilities during period. |
(3) |
Represents cash payments to settle ARO liabilities during period. |
(4) |
Represents net change in ARO liability balance attributable to the passage of time and other adjustments, including true-up amounts associated with revised closure estimates. |
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||
2022 |
2021 |
2022 |
2021 |
|||||||||||||
Depreciation expense (1) |
$ |
445 |
$ |
425 |
$ |
883 |
$ |
849 |
||||||||
Accretion expense (1) |
6 |
1 |
8 |
3 |
||||||||||||
Capitalized interest (2) |
21 |
21 |
38 |
41 |
(1) |
Depreciation and accretion expense is a component of “Costs and expenses” as presented on our Unaudited Condensed Statements of Consolidated Operations. |
(2) |
We capitalize interest costs incurred on funds used to construct property, plant and equipment while the asset is in its construction phase. The capitalized interest is recorded as part of the asset to which it relates and is amortized over the asset’s estimated useful life as a component of depreciation expense. When capitalized interest is recorded, it reduces interest expense from what it would be otherwise. |
June 30, 2022 |
December 31, 2021 |
|||||||
NGL Pipelines & Services |
$ |
650 |
$ |
656 |
||||
Crude Oil Pipelines & Services |
1,690 |
1,738 |
||||||
Natural Gas Pipelines & Services |
31 |
31 |
||||||
Petrochemical & Refined Products Services |
3 |
3 |
||||||
Total |
$ |
2,374 |
$ |
2,428 |
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||
2022 |
2021 |
2022 |
2021 |
|||||||||||||
NGL Pipelines & Services |
$ |
36 |
$ |
29 |
$ |
70 |
$ |
57 |
||||||||
Crude Oil Pipelines & Services |
70 |
130 |
151 |
249 |
||||||||||||
Natural Gas Pipelines & Services |
– |
2 |
2 |
3 |
||||||||||||
Petrochemical & Refined Products Services |
1 |
– |
1 |
1 |
||||||||||||
Total |
$ |
107 |
$ |
161 |
$ |
224 |
$ |
310 |
June 30, 2022 |
December 31, 2021 |
|||||||||||||||||||||||
Gross Value |
Accumulated Amortization |
Carrying Value |
Gross Value |
Accumulated Amortization |
Carrying Value |
|||||||||||||||||||
NGL Pipelines & Services: |
||||||||||||||||||||||||
Customer relationship intangibles |
$ |
449 |
$ |
(242 |
) |
$ |
207 |
$ |
449 |
$ |
(236 |
) |
$ |
213 |
||||||||||
Contract-based intangibles |
749 |
(72 |
) |
677 |
165 |
(61 |
) |
104 |
||||||||||||||||
Segment total |
1,198 |
(314 |
) |
884 |
614 |
(297 |
) |
317 |
||||||||||||||||
Crude Oil Pipelines & Services: |
||||||||||||||||||||||||
Customer relationship intangibles |
2,195 |
(392 |
) |
1,803 |
2,195 |
(355 |
) |
1,840 |
||||||||||||||||
Contract-based intangibles |
283 |
(267 |
) |
16 |
283 |
(263 |
) |
20 |
||||||||||||||||
Segment total |
2,478 |
(659 |
) |
1,819 |
2,478 |
(618 |
) |
1,860 |
||||||||||||||||
Natural Gas Pipelines & Services: |
||||||||||||||||||||||||
Customer relationship intangibles |
1,350 |
(569 |
) |
781 |
1,350 |
(550 |
) |
800 |
||||||||||||||||
Contract-based intangibles |
639 |
(189 |
) |
450 |
232 |
(183 |
) |
49 |
||||||||||||||||
Segment total |
1,989 |
(758 |
) |
1,231 |
1,582 |
(733 |
) |
849 |
||||||||||||||||
Petrochemical & Refined Products Services: |
||||||||||||||||||||||||
Customer relationship intangibles |
181 |
(78 |
) |
103 |
181 |
(75 |
) |
106 |
||||||||||||||||
Contract-based intangibles |
45 |
(26 |
) |
19 |
45 |
(26 |
) |
19 |
||||||||||||||||
Segment total |
226 |
(104 |
) |
122 |
226 |
(101 |
) |
125 |
||||||||||||||||
Total intangible assets |
$ |
5,891 |
$ |
(1,835 |
) |
$ |
4,056 |
$ |
4,900 |
$ |
(1,749 |
) |
$ |
3,151 |
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||
2022 |
2021 |
2022 |
2021 |
|||||||||||||
NGL Pipelines & Services |
$ |
9 |
$ |
6 |
$ |
17 |
$ |
12 |
||||||||
Crude Oil Pipelines & Services |
21 |
19 |
41 |
37 |
||||||||||||
Natural Gas Pipelines & Services |
14 |
11 |
25 |
21 |
||||||||||||
Petrochemical & Refined Products Services |
1 |
2 |
3 |
4 |
||||||||||||
Total |
$ |
45 |
$ |
38 |
$ |
86 |
$ |
74 |
Remainder of 2022 |
2023 |
2024 |
2025 |
2026 |
||||||||||||||
$ |
100 |
$ |
204 |
$ |
212 |
$ |
211 |
$ |
206 |
NGL Pipelines & Services |
Crude Oil Pipelines & Services |
Natural Gas Pipelines & Services |
Petrochemical & Refined Products Services |
Consolidated Total |
||||||||||||||||
Balance at December 31, 2021 |
$ |
2,652 |
$ |
1,841 |
$ |
– |
$ |
956 |
$ |
5,449 |
||||||||||
Goodwill related to acquisition (1) |
159 |
– |
– |
– |
159 |
|||||||||||||||
Balance at June 30, 2022 |
$ |
2,811 |
$ |
1,841 |
$ |
– |
$ |
956 |
$ |
5,608 |
(1) |
This amount represents the goodwill recognized in connection with our acquisition of Navitas Midstream in February 2022. See Note 12 for additional information regarding this acquisition. |
June 30, 2022 |
December 31, 2021 |
|||||||
EPO senior debt obligations: |
||||||||
Commercial Paper Notes, variable-rates |
$ |
640 |
$ |
– |
||||
Senior Notes VV, 3.50% fixed-rate, due February 2022 |
– |
750 |
||||||
Senior Notes CC, 4.05% fixed-rate, due February 2022 |
– |
650 |
||||||
September 2021 364-Day Revolving Credit Agreement, variable-rate, due September 2022 |
– |
– |
||||||
Senior Notes HH, 3.35% fixed-rate, due March 2023 |
1,250 |
1,250 |
||||||
Senior Notes JJ, 3.90% fixed-rate, due February 2024 |
850 |
850 |
||||||
Senior Notes MM, 3.75% fixed-rate, due February 2025 |
1,150 |
1,150 |
||||||
Senior Notes PP, 3.70% fixed-rate, due February 2026 |
875 |
875 |
||||||
September 2021 Multi-Year Revolving Credit Agreement, variable-rate, due September 2026 |
– |
– |
||||||
Senior Notes SS, 3.95% fixed-rate, due February 2027 |
575 |
575 |
||||||
Senior Notes WW, 4.15% fixed-rate, due October 2028 |
1,000 |
1,000 |
||||||
Senior Notes YY, 3.125% fixed-rate, due July 2029 |
1,250 |
1,250 |
||||||
Senior Notes AAA, 2.80% fixed-rate, due January 2030 |
1,250 |
1,250 |
||||||
Senior Notes D, 6.875% fixed-rate, due March 2033 |
500 |
500 |
||||||
Senior Notes H, 6.65% fixed-rate, due October 2034 |
350 |
350 |
||||||
Senior Notes J, 5.75% fixed-rate, due March 2035 |
250 |
250 |
||||||
Senior Notes W, 7.55% fixed-rate, due April 2038 |
400 |
400 |
||||||
Senior Notes R, 6.125% fixed-rate, due October 2039 |
600 |
600 |
||||||
Senior Notes Z, 6.45% fixed-rate, due September 2040 |
600 |
600 |
||||||
Senior Notes BB, 5.95% fixed-rate, due February 2041 |
750 |
750 |
||||||
Senior Notes DD, 5.70% fixed-rate, due February 2042 |
600 |
600 |
||||||
Senior Notes EE, 4.85% fixed-rate, due August 2042 |
750 |
750 |
||||||
Senior Notes GG, 4.45% fixed-rate, due February 2043 |
1,100 |
1,100 |
||||||
Senior Notes II, 4.85% fixed-rate, due March 2044 |
1,400 |
1,400 |
||||||
Senior Notes KK, 5.10% fixed-rate, due February 2045 |
1,150 |
1,150 |
||||||
Senior Notes QQ, 4.90% fixed-rate, due May 2046 |
975 |
975 |
||||||
Senior Notes UU, 4.25% fixed-rate, due February 2048 |
1,250 |
1,250 |
||||||
Senior Notes XX, 4.80% fixed-rate, due February 2049 |
1,250 |
1,250 |
||||||
Senior Notes ZZ, 4.20% fixed-rate, due January 2050 |
1,250 |
1,250 |
||||||
Senior Notes BBB, 3.70% fixed-rate, due January 2051 |
1,000 |
1,000 |
||||||
Senior Notes DDD, 3.20% fixed-rate, due February 2052 |
1,000 |
1,000 |
||||||
Senior Notes EEE, 3.30% fixed-rate, due February 2053 |
1,000 |
1,000 |
||||||
Senior Notes NN, 4.95% fixed-rate, due October 2054 |
400 |
400 |
||||||
Senior Notes CCC, 3.95% fixed rate, due January 2060 |
1,000 |
1,000 |
||||||
Total principal amount of senior debt obligations |
26,415 |
27,175 |
||||||
EPO Junior Subordinated Notes C, variable-rate, due June 2067 (1) |
232 |
232 |
||||||
EPO Junior Subordinated Notes D, fixed/variable-rate, due August 2077 (2) |
700 |
700 |
||||||
EPO Junior Subordinated Notes E, fixed/variable-rate, due August 2077 (3) |
1,000 |
1,000 |
||||||
EPO Junior Subordinated Notes F, fixed/variable-rate, due February 2078 (4) |
700 |
700 |
||||||
TEPPCO Junior Subordinated Notes, variable-rate, due June 2067 (1) |
14 |
14 |
||||||
Total principal amount of senior and junior debt obligations |
29,061 |
29,821 |
||||||
Other, non-principal amounts |
(280 |
) |
(286 |
) |
||||
Less current maturities of debt |
(1,889 |
) |
(1,400 |
) |
||||
Total long-term debt |
$ |
26,892 |
$ |
28,135 |
(1) |
Variable rate is reset quarterly and based on 3-month London Interbank Offered Rate (“LIBOR”), plus 2.778%. |
(2) |
Fixed rate of 4.875% through August 15, 2022; thereafter, a variable rate reset quarterly and based on 3-month LIBOR plus 2.986%. |
(3) |
Fixed rate of 5.250% through August 15, 2027; thereafter, a variable rate reset quarterly and based on 3-month LIBOR plus 3.033%. |
(4) |
Fixed rate of 5.375% through February 14, 2028; thereafter, a variable rate reset quarterly and based on 3-month LIBOR plus 2.57%. |
Range of Interest Rates Paid |
Weighted-Average Interest Rate Paid |
|
Commercial Paper Notes |
0.20% to 1.85% |
0.72% |
EPO Junior Subordinated Notes C and TEPPCO Junior Subordinated Notes |
2.95% to 4.36% |
3.36% |
Scheduled Maturities of Debt |
||||||||||||||||||||||||||||
Total |
Remainder of 2022 |
2023 |
2024 |
2025 |
2026 |
Thereafter |
||||||||||||||||||||||
Commercial Paper Notes |
$ |
640 |
$ |
640 |
$ |
– |
$ |
– |
$ |
– |
$ |
– |
$ |
– |
||||||||||||||
Senior Notes |
25,775 |
– |
1,250 |
850 |
1,150 |
875 |
21,650 |
|||||||||||||||||||||
Junior Subordinated Notes |
2,646 |
– |
– |
– |
– |
– |
2,646 |
|||||||||||||||||||||
Total |
$ |
29,061 |
$ |
640 |
$ |
1,250 |
$ |
850 |
$ |
1,150 |
$ |
875 |
$ |
24,296 |
Common units outstanding at December 31, 2021 |
2,176,379,587 |
|||
Common units issued in connection with the vesting of phantom unit awards, net |
4,051,207 |
|||
Other |
22,350 |
|||
Common units outstanding at March 31, 2022 |
2,180,453,144 |
|||
Common unit repurchases under 2019 Buyback Program |
(1,408,121 |
) |
||
Common units issued in connection with the vesting of phantom unit awards, net |
204,357 |
|||
Common units outstanding at June 30, 2022 |
2,179,249,380 |
Cash Flow Hedges |
||||||||||||||||
Commodity Derivative Instruments |
Interest Rate Derivative Instruments |
Other |
Total |
|||||||||||||
Accumulated Other Comprehensive Income (Loss), December 31, 2021 |
$ |
137 |
$ |
147 |
$ |
2 |
$ |
286 |
||||||||
Other comprehensive income (loss) for period, before reclassifications |
(60 |
) |
– |
– |
(60 |
) |
||||||||||
Reclassification of losses (gains) to net income during period |
(63 |
) |
14 |
– |
(49 |
) |
||||||||||
Total other comprehensive income (loss) for period |
(123 |
) |
14 |
– |
(109 |
) |
||||||||||
Accumulated Other Comprehensive Income (Loss), June 30, 2022 |
$ |
14 |
$ |
161 |
$ |
2 |
$ |
177 |
Cash Flow Hedges |
||||||||||||||||
Commodity Derivative Instruments |
Interest Rate Derivative Instruments |
Other |
Total |
|||||||||||||
Accumulated Other Comprehensive Income (Loss), December 31, 2020 |
$ |
(93 |
) |
$ |
(74 |
) |
$ |
2 |
$ |
(165 |
) |
|||||
Other comprehensive income (loss) for period, before reclassifications |
(752 |
) |
183 |
– |
(569 |
) |
||||||||||
Reclassification of losses (gains) to net income during period |
517 |
18 |
– |
535 |
||||||||||||
Total other comprehensive income (loss) for period |
(235 |
) |
201 |
– |
(34 |
) |
||||||||||
Accumulated Other Comprehensive Income (Loss), June 30, 2021 |
$ |
(328 |
) |
$ |
127 |
$ |
2 |
$ |
(199 |
) |
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
||||||||||||||||
Losses (gains) on cash flow hedges: |
Location |
2022 |
2021 |
2022 |
2021 |
||||||||||||
Interest rate derivatives |
Interest expense |
$ |
6 |
$ |
10 |
$ |
14 |
$ |
18 |
||||||||
Commodity derivatives |
Revenue |
(86 |
) |
(99 |
) |
(47 |
) |
498 |
|||||||||
Commodity derivatives |
Operating costs and expenses |
(22 |
) |
– |
(16 |
) |
19 |
||||||||||
Total |
$ |
(102 |
) |
$ |
(89 |
) |
$ |
(49 |
) |
$ |
535 |
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||
2022 |
2021 |
2022 |
2021 |
|||||||||||||
NGL Pipelines & Services: |
||||||||||||||||
Sales of NGLs and related products |
$ |
5,580 |
$ |
2,976 |
$ |
10,620 |
$ |
5,982 |
||||||||
Segment midstream services: |
||||||||||||||||
Natural gas processing and fractionation |
463 |
252 |
803 |
435 |
||||||||||||
Transportation |
229 |
235 |
458 |
510 |
||||||||||||
Storage and terminals |
108 |
124 |
253 |
244 |
||||||||||||
Total segment midstream services |
800 |
611 |
1,514 |
1,189 |
||||||||||||
Total NGL Pipelines & Services |
6,380 |
3,587 |
12,134 |
7,171 |
||||||||||||
Crude Oil Pipelines & Services: |
||||||||||||||||
Sales of crude oil |
5,031 |
2,139 |
8,747 |
3,978 |
||||||||||||
Segment midstream services: |
||||||||||||||||
Transportation |
249 |
250 |
488 |
459 |
||||||||||||
Storage and terminals |
105 |
115 |
222 |
232 |
||||||||||||
Total segment midstream services |
354 |
365 |
710 |
691 |
||||||||||||
Total Crude Oil Pipelines & Services |
5,385 |
2,504 |
9,457 |
4,669 |
||||||||||||
Natural Gas Pipelines & Services: |
||||||||||||||||
Sales of natural gas |
1,359 |
476 |
2,239 |
1,811 |
||||||||||||
Segment midstream services: |
||||||||||||||||
Transportation |
302 |
233 |
571 |
485 |
||||||||||||
Total segment midstream services |
302 |
233 |
571 |
485 |
||||||||||||
Total Natural Gas Pipelines & Services |
1,661 |
709 |
2,810 |
2,296 |
||||||||||||
Petrochemical & Refined Products Services: |
||||||||||||||||
Sales of petrochemicals and refined products |
2,370 |
2,386 |
4,124 |
3,985 |
||||||||||||
Segment midstream services: |
||||||||||||||||
Fractionation and isomerization |
47 |
80 |
116 |
133 |
||||||||||||
Transportation, including marine logistics |
139 |
124 |
277 |
241 |
||||||||||||
Storage and terminals |
78 |
60 |
150 |
110 |
||||||||||||
Total segment midstream services |
264 |
264 |
543 |
484 |
||||||||||||
Total Petrochemical & Refined Products Services |
2,634 |
2,650 |
4,667 |
4,469 |
||||||||||||
Total consolidated revenues |
$ |
16,060 |
$ |
9,450 |
$ |
29,068 |
$ |
18,605 |
Contract Asset |
Location |
Balance |
|||
Unbilled revenue (current amount) |
Prepaid and other current assets |
$ |
113 |
||
Total |
$ |
113 |
Contract Liability |
Location |
Balance |
|||
Deferred revenue (current amount) |
Other current liabilities |
$ |
172 |
||
Deferred revenue (noncurrent) |
Other long-term liabilities |
273 |
|||
Total |
$ |
445 |
Unbilled Revenue |
Deferred Revenue |
|||||||
Balance at December 31, 2021 |
$ |
15 |
$ |
446 |
||||
Amount included in opening balance transferred to other accounts during period (1) |
(4 |
) |
(151 |
) |
||||
Amount recorded during period (2) |
120 |
492 |
||||||
Amounts recorded during period transferred to other accounts (1) |
(18 |
) |
(337 |
) |
||||
Other changes |
– |
(5 |
) |
|||||
Balance at June 30, 2022 |
$ |
113 |
$ |
445 |
(1) |
Unbilled revenues are transferred to accounts receivable once we have an unconditional right to consideration from the customer. Deferred revenues are recognized as revenue upon satisfaction of our performance obligation to the customer. |
(2) |
Unbilled revenue represents revenue that has been recognized upon satisfaction of a performance obligation, but cannot be contractually invoiced (or billed) to the customer at the balance sheet date until a future period. Deferred revenue is recorded when payment is received from a customer prior to our satisfaction of the associated performance obligation. |
Period |
Fixed Consideration |
|||
Six Months Ended December 31, 2022 |
$ |
1,850 |
||
One Year Ended December 31, 2023 |
3,317 |
|||
One Year Ended December 31, 2024 |
3,072 |
|||
One Year Ended December 31, 2025 |
2,677 |
|||
One Year Ended December 31, 2026 |
2,491 |
|||
Thereafter |
10,151 |
|||
Total |
$ |
23,558 |
• | Our NGL Pipelines & Services business segment includes our natural gas processing and related NGL marketing activities, NGL pipelines, NGL fractionation facilities, NGL and related product storage facilities, and NGL marine terminals. |
• | Our Crude Oil Pipelines & Services business segment includes our crude oil pipelines, crude oil storage and marine terminals, and related crude oil marketing activities. |
• | Our Natural Gas Pipelines & Services business segment includes our natural gas pipeline systems that provide for the gathering, treating and transportation of natural gas. This segment also includes our natural gas marketing activities. |
• | Our Petrochemical & Refined Products Services business segment includes our (i) propylene production facilities, which include propylene fractionation units and a PDH facility, and related pipelines and marketing activities, (ii) butane isomerization complex and related deisobutanizer operations, (iii) octane enhancement, iBDH and HPIB production facilities, (iv) refined products pipelines, terminals and related marketing activities, (v) ethylene export terminal and related operations; and (vi) marine transportation business. |
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||
2022 |
2021 |
2022 |
2021 |
|||||||||||||
Operating income |
$ |
1,764 |
$ |
1,492 |
$ |
3,430 |
$ |
3,187 |
||||||||
Adjustments to reconcile operating income to total segment gross operating margin (addition or subtraction indicated by sign): |
||||||||||||||||
Depreciation, amortization and accretion expense in operating costs and expenses (1) |
531 |
500 |
1,045 |
995 |
||||||||||||
Asset impairment charges in operating costs and expenses |
5 |
18 |
19 |
84 |
||||||||||||
Net losses attributable to asset sales and related matters in operating costs and expenses |
– |
– |
2 |
11 |
||||||||||||
General and administrative costs |
62 |
52 |
124 |
108 |
||||||||||||
Non-refundable payments received from shippers attributable to make-up rights (2) |
39 |
22 |
73 |
41 |
||||||||||||
Subsequent recognition of revenues attributable to make-up rights (3) |
(17 |
) |
(39 |
) |
(45 |
) |
(78 |
) |
||||||||
Total segment gross operating margin |
$ |
2,384 |
$ |
2,045 |
$ |
4,648 |
$ |
4,348 |
(1) |
Excludes amortization of major maintenance costs for reaction-based plants, which are a component of gross operating margin. |
(2) |
Since make-up rights entail a future performance obligation by the pipeline to the shipper, these receipts are recorded as deferred revenue for GAAP purposes; however, these receipts are included in gross operating margin in the period of receipt since they are nonrefundable to the shipper. |
(3) |
As deferred revenues attributable to make-up rights are subsequently recognized as revenue under GAAP, gross operating margin must be adjusted to remove such amounts to prevent duplication since the associated non-refundable payments were previously included in gross operating margin. |
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||
2022 |
2021 |
2022 |
2021 |
|||||||||||||
Gross operating margin by segment: |
||||||||||||||||
NGL Pipelines & Services |
$ |
1,327 |
$ |
1,098 |
$ |
2,552 |
$ |
2,184 |
||||||||
Crude Oil Pipelines & Services |
407 |
419 |
822 |
819 |
||||||||||||
Natural Gas Pipelines & Services |
229 |
202 |
449 |
737 |
||||||||||||
Petrochemical & Refined Products Services |
421 |
326 |
825 |
608 |
||||||||||||
Total segment gross operating margin |
$ |
2,384 |
$ |
2,045 |
$ |
4,648 |
$ |
4,348 |
Reportable Business Segments |
||||||||||||||||||||||||
NGL Pipelines & Services |
Crude Oil Pipelines & Services |
Natural Gas Pipelines & Services |
Petrochemical & Refined Products Services |
Adjustments and Eliminations |
Consolidated Total |
|||||||||||||||||||
Revenues from third parties: |
||||||||||||||||||||||||
Three months ended June 30, 2022 |
$ |
6,374 |
$ |
5,380 |
$ |
1,653 |
$ |
2,634 |
$ |
– |
$ |
16,041 |
||||||||||||
Three months ended June 30, 2021 |
3,584 |
2,501 |
706 |
2,650 |
– |
9,441 |
||||||||||||||||||
Six months ended June 30, 2022 |
12,126 |
9,443 |
2,797 |
4,667 |
– |
29,033 |
||||||||||||||||||
Six months ended June 30, 2021 |
7,165 |
4,658 |
2,290 |
4,469 |
– |
18,582 |
||||||||||||||||||
Revenues from related parties: |
||||||||||||||||||||||||
Three months ended June 30, 2022 |
6 |
5 |
8 |
– |
– |
19 |
||||||||||||||||||
Three months ended June 30, 2021 |
3 |
3 |
3 |
– |
– |
9 |
||||||||||||||||||
Six months ended June 30, 2022 |
8 |
14 |
13 |
– |
– |
35 |
||||||||||||||||||
Six months ended June 30, 2021 |
6 |
11 |
6 |
– |
– |
23 |
||||||||||||||||||
Intersegment and intrasegment revenues: |
||||||||||||||||||||||||
Three months ended June 30, 2022 |
19,098 |
11,957 |
218 |
5,290 |
(36,563 |
) |
– |
|||||||||||||||||
Three months ended June 30, 2021 |
10,298 |
7,876 |
149 |
6,596 |
(24,919 |
) |
– |
|||||||||||||||||
Six months ended June 30, 2022 |
37,413 |
21,871 |
421 |
8,512 |
(68,217 |
) |
– |
|||||||||||||||||
Six months ended June 30, 2021 |
23,387 |
15,296 |
295 |
12,830 |
(51,808 |
) |
– |
|||||||||||||||||
Total revenues: |
||||||||||||||||||||||||
Three months ended June 30, 2022 |
25,478 |
17,342 |
1,879 |
7,924 |
(36,563 |
) |
16,060 |
|||||||||||||||||
Three months ended June 30, 2021 |
13,885 |
10,380 |
858 |
9,246 |
(24,919 |
) |
9,450 |
|||||||||||||||||
Six months ended June 30, 2022 |
49,547 |
31,328 |
3,231 |
13,179 |
(68,217 |
) |
29,068 |
|||||||||||||||||
Six months ended June 30, 2021 |
30,558 |
19,965 |
2,591 |
17,299 |
(51,808 |
) |
18,605 |
|||||||||||||||||
Equity in income loss of unconsolidated affiliates: |
||||||||||||||||||||||||
Three months ended June 30, 2022 |
36 |
70 |
– |
1 |
– |
107 |
||||||||||||||||||
Three months ended June 30, 2021 |
29 |
130 |
2 |
– |
– |
161 |
||||||||||||||||||
Six months ended June 30, 2022 |
70 |
151 |
2 |
1 |
– |
224 |
||||||||||||||||||
Six months ended June 30, 2021 |
57 |
249 |
3 |
1 |
– |
310 |
Reportable Business Segments |
||||||||||||||||||||||||
NGL Pipelines & Services |
Crude Oil Pipelines & Services |
Natural Gas Pipelines & Services |
Petrochemical & Refined Products Services |
Adjustments and Eliminations |
Consolidated Total |
|||||||||||||||||||
Property, plant and equipment, net: (see Note 4) |
||||||||||||||||||||||||
At June 30, 2022 |
$ |
17,452 |
$ |
6,862 |
$ |
9,916 |
$ |
7,686 |
$ |
2,213 |
$ |
44,129 |
||||||||||||
At December 31, 2021 |
17,202 |
6,974 |
8,560 |
7,736 |
1,616 |
42,088 |
||||||||||||||||||
Investments in unconsolidated affiliates: (see Note 5) |
||||||||||||||||||||||||
At June 30, 2022 |
650 |
1,690 |
31 |
3 |
– |
2,374 |
||||||||||||||||||
At December 31, 2021 |
656 |
1,738 |
31 |
3 |
– |
2,428 |
||||||||||||||||||
Intangible assets, net: (see Note 6) |
||||||||||||||||||||||||
At June 30, 2022 |
884 |
1,819 |
1,231 |
122 |
– |
4,056 |
||||||||||||||||||
At December 31, 2021 |
317 |
1,860 |
849 |
125 |
– |
3,151 |
||||||||||||||||||
Goodwill: (see Note 6) |
||||||||||||||||||||||||
At June 30, 2022 |
2,811 |
1,841 |
– |
956 |
– |
5,608 |
||||||||||||||||||
At December 31, 2021 |
2,652 |
1,841 |
– |
956 |
– |
5,449 |
||||||||||||||||||
Segment assets: |
||||||||||||||||||||||||
At June 30, 2022 |
21,797 |
12,212 |
11,178 |
8,767 |
2,213 |
56,167 |
||||||||||||||||||
At December 31, 2021 |
20,827 |
12,413 |
9,440 |
8,820 |
1,616 |
53,116 |
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||
2022 |
2021 |
2022 |
2021 |
|||||||||||||
Consolidated revenues: |
||||||||||||||||
NGL Pipelines & Services |
$ |
6,380 |
$ |
3,587 |
$ |
12,134 |
$ |
7,171 |
||||||||
Crude Oil Pipelines & Services |
5,385 |
2,504 |
9,457 |
4,669 |
||||||||||||
Natural Gas Pipelines & Services |
1,661 |
709 |
2,810 |
2,296 |
||||||||||||
Petrochemical & Refined Products Services |
2,634 |
2,650 |
4,667 |
4,469 |
||||||||||||
Total consolidated revenues |
$ |
16,060 |
$ |
9,450 |
$ |
29,068 |
$ |
18,605 |
||||||||
Consolidated costs and expenses |
||||||||||||||||
Operating costs and expenses: |
||||||||||||||||
Cost of sales |
$ |
12,908 |
$ |
6,840 |
$ |
23,006 |
$ |
13,103 |
||||||||
Other operating costs and expenses (1) |
884 |
702 |
1,641 |
1,417 |
||||||||||||
Depreciation, amortization and accretion |
544 |
507 |
1,070 |
1,005 |
||||||||||||
Asset impairment charges |
5 |
18 |
19 |
84 |
||||||||||||
Net losses attributable to asset sales and related matters |
– |
– |
2 |
11 |
||||||||||||
General and administrative costs |
62 |
52 |
124 |
108 |
||||||||||||
Total consolidated costs and expenses |
$ |
14,403 |
$ |
8,119 |
$ |
25,862 |
$ |
15,728 |
(1) |
Represents the cost of operating our plants, pipelines and other fixed assets excluding: depreciation, amortization and accretion charges; asset impairment charges; and net losses attributable to asset sales and related matters. |
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||
2022 |
2021 |
2022 |
2021 |
|||||||||||||
BASIC EARNINGS PER COMMON UNIT |
||||||||||||||||
Net income attributable to common unitholders |
$ |
1,411 |
$ |
1,112 |
$ |
2,707 |
$ |
2,453 |
||||||||
Earnings allocated to phantom unit awards (1) |
(12 |
) |
(9 |
) |
(23 |
) |
(20 |
) |
||||||||
Net income allocated to common unitholders |
$ |
1,399 |
$ |
1,103 |
$ |
2,684 |
$ |
2,433 |
||||||||
Basic weighted-average number of common units outstanding |
2,180 |
2,185 |
2,179 |
2,184 |
||||||||||||
Basic earnings per common unit |
$ |
0.64 |
$ |
0.50 |
$ |
1.23 |
$ |
1.11 |
||||||||
DILUTED EARNINGS PER COMMON UNIT |
||||||||||||||||
Net income attributable to common unitholders |
$ |
1,411 |
$ |
1,112 |
$ |
2,707 |
$ |
2,453 |
||||||||
Net income attributable to preferred units |
1 |
1 |
2 |
2 |
||||||||||||
Net income attributable to limited partners |
$ |
1,412 |
$ |
1,113 |
$ |
2,709 |
$ |
2,455 |
||||||||
Diluted weighted-average number of units outstanding: |
||||||||||||||||
Distribution-bearing common units |
2,180 |
2,185 |
2,179 |
2,184 |
||||||||||||
Phantom units (2) |
19 |
18 |
19 |
18 |
||||||||||||
Preferred units (2) |
2 |
2 |
2 |
2 |
||||||||||||
Total |
2,201 |
2,205 |
2,200 |
2,204 |
||||||||||||
Diluted earnings per common unit |
$ |
0.64 |
$ |
0.50 |
$ |
1.23 |
$ |
1.11 |
(1) |
Phantom units are considered participating securities for purposes of computing basic earnings per unit. See Note 13 for information regarding the phantom units. |
(2) |
We use the “if-converted method” to determine the potential dilutive effect of the vesting of phantom unit awards and the conversion of preferred units outstanding. See Note 13 for information regarding phantom unit awards. See Note 8 for information regarding preferred units. |
Purchase price for 100% interest in Navitas Midstream |
$ |
3,231 |
||
Recognized amounts of identifiable assets acquired and liabilities assumed: |
||||
Cash and cash equivalents |
$ |
27 |
||
Property, plant and equipment |
2,080 |
|||
Contract-based intangible asset |
989 |
|||
Assumed liabilities, net of acquired other assets (1) |
(24 |
) |
||
Total identifiable net assets |
$ |
3,072 |
||
Goodwill |
$ |
159 |
(1) |
Assumed liabilities primarily include accounts payable, other current liabilities, lease liabilities and asset retirement obligations. Acquired other assets primarily include accounts receivable, other current assets and right-of-use (“ROU”) assets. None of these amounts were considered individually significant. |
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||
2022 |
2021 |
2022 |
2021 |
|||||||||||||
Equity-classified awards: |
||||||||||||||||
Phantom unit awards |
$ |
40 |
$ |
38 |
$ |
78 |
$ |
76 |
||||||||
Profits interest awards |
1 |
3 |
2 |
4 |
||||||||||||
Total |
$ |
41 |
$ |
41 |
$ |
80 |
$ |
80 |
Number of Units |
Weighted- Average Grant Date Fair Value per Unit (1) |
|||||||
Phantom unit awards at December 31, 2021 |
17,170,919 |
$ |
24.31 |
|||||
Granted (2) |
7,968,380 |
$ |
24.11 |
|||||
Vested |
(6,169,973 |
) |
$ |
25.14 |
||||
Forfeited |
(338,034 |
) |
$ |
23.94 |
||||
Phantom unit awards at June 30, 2022 |
18,631,292 |
$ |
23.95 |
(1) |
Determined by dividing the aggregate grant date fair value of awards (before an allowance for forfeitures) by the number of awards issued. |
(2) |
The aggregate grant date fair value of phantom unit awards issued during 2022 was $192 million based on a grant date market price of the Partnership’s common units ranging from $24.10 to $25.61 per unit. An estimated annual forfeiture rate of 2.0% was applied to these awards. |
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||
2022 |
2021 |
2022 |
2021 |
|||||||||||||
Cash payments made in connection with DERs |
$ |
9 |
$ |
8 |
$ |
17 |
$ |
15 |
||||||||
Total intrinsic value of phantom unit awards that vested during period |
7 |
6 |
149 |
119 |
Volume (1) |
Accounting |
||
Derivative Purpose |
Current (2) |
Long-Term (2) |
Treatment |
Derivatives designated as hedging instruments: |
|||
Natural gas processing: |
|||
Forecasted natural gas purchases for plant thermal reduction (billion cubic feet (“Bcf”)) |
16.6 |
0.3 |
Cash flow hedge |
Forecasted sales of NGLs (MMBbls) |
0.8 |
n/a |
Cash flow hedge |
Octane enhancement: |
|||
Forecasted sales of octane enhancement products (MMBbls) |
19.6 |
1.6 |
Cash flow hedge |
Natural gas marketing: |
|||
Natural gas storage inventory management activities (Bcf) |
2.8 |
n/a |
Fair value hedge |
NGL marketing: |
|||
Forecasted purchases of NGLs and related hydrocarbon products (MMBbls) |
144.9 |
12.6 |
Cash flow hedge |
Forecasted sales of NGLs and related hydrocarbon products (MMBbls) |
150.4 |
5.3 |
Cash flow hedge |
NGLs inventory management activities (MMBbls) |
2.5 |
n/a |
Fair value hedge |
Crude oil marketing: |
|||
Forecasted purchases of crude oil (MMBbls) |
11.4 |
n/a |
Cash flow hedge |
Forecasted sales of crude oil (MMBbls) |
8.2 |
n/a |
Cash flow hedge |
Petrochemical marketing: |
|||
Forecasted purchases of petrochemical products (MMBbls) |
0.1 |
n/a |
Cash flow hedge |
Forecasted sales of petrochemical products (MMBbls) |
1.0 |
n/a |
Cash flow hedge |
Commercial energy: |
|||
Forecasted purchases of power related to asset operations (terawatt hours (“TWh”)) |
1.0 |
2.7 |
Cash flow hedge |
Derivatives not designated as hedging instruments: |
|||
Natural gas risk management activities (Bcf) (3) |
18.7 |
0.1 |
Mark-to-market |
NGL risk management activities (MMBbls) (3) |
38.8 |
9.1 |
Mark-to-market |
Refined products risk management activities (MMBbls) (3) |
5.0 |
n/a |
Mark-to-market |
Crude oil risk management activities (MMBbls) (3) |
45.7 |
5.6 |
Mark-to-market |
Commercial energy risk management activities (TWh) (3) |
0.5 |
1.2 |
Mark-to-market |
(1) |
Volume for derivatives designated as hedging instruments reflects the total amount of volumes hedged whereas volume for derivatives not designated as hedging instruments reflects the absolute value of derivative notional volumes. |
(2) |
The maximum term for derivatives designated as cash flow hedges, derivatives designated as fair value hedges and derivatives not designated as hedging instruments is December 2025, August 2022 and December 2024, respectively. |
(3) |
Reflects the use of derivative instruments to manage risks associated with our transportation, processing, storage assets and end use power requirements. |
Asset Derivatives |
Liability Derivatives |
||||||||||||||
June 30, 2022 |
December 31, 2021 |
June 30, 2022 |
December 31, 2021 |
||||||||||||
Balance Sheet Location |
Fair Value |
Balance Sheet Location |
Fair Value |
Balance Sheet Location |
Fair Value |
Balance Sheet Location |
Fair Value |
||||||||
Derivatives designated as hedging instruments |
|||||||||||||||
Commodity derivatives |
Current assets |
$ |
251 |
Current assets |
$ |
195 |
Current liabilities |
$ |
255 |
Current liabilities |
$ |
212 |
|||
Commodity derivatives |
Other assets |
30 |
Other assets |
– |
Other liabilities |
49 |
Other liabilities |
1 |
|||||||
Total commodity derivatives |
281 |
195 |
304 |
213 |
|||||||||||
Total derivatives designated as hedging instruments |
$ |
281 |
$ |
195 |
$ |
304 |
$ |
213 |
|||||||
Derivatives not designated as hedging instruments |
|||||||||||||||
Commodity derivatives |
Current assets |
$ |
81 |
Current assets |
$ |
42 |
Current liabilities |
$ |
90 |
Current liabilities |
$ |
42 |
|||
Commodity derivatives |
Other assets |
11 |
Other assets |
2 |
Other liabilities |
18 |
Other liabilities |
1 |
|||||||
Total commodity derivatives |
92 |
44 |
108 |
43 |
|||||||||||
Total derivatives not designated as hedging instruments |
$ |
92 |
$ |
44 |
$ |
108 |
$ |
43 |
Offsetting of Financial Assets and Derivative Assets |
||||||||||||||||||||||||||||
Gross Amounts of Recognized Assets |
Gross Amounts Offset in the Balance Sheet |
Amounts of Assets Presented in the Balance Sheet |
Gross Amounts Not Offset in the Balance Sheet |
Amounts That Would Have Been Presented On Net Basis |
||||||||||||||||||||||||
Financial Instruments |
Cash Collateral Received |
Cash Collateral Paid |
||||||||||||||||||||||||||
(i) |
(ii) |
(iii) = (i) – (ii) |
(iv) |
(v) = (iii) + (iv) |
||||||||||||||||||||||||
As of June 30, 2022: |
||||||||||||||||||||||||||||
Commodity derivatives |
$ |
373 |
$ |
– |
$ |
373 |
$ |
(373 |
) |
$ |
– |
$ |
– |
$ |
– |
|||||||||||||
As of December 31, 2021: |
||||||||||||||||||||||||||||
Commodity derivatives |
$ |
239 |
$ |
– |
$ |
239 |
$ |
(233 |
) |
$ |
– |
$ |
– |
$ |
6 |
Offsetting of Financial Liabilities and Derivative Liabilities |
||||||||||||||||||||||||||||
Gross Amounts of Recognized Liabilities |
Gross Amounts Offset in the Balance Sheet |
Amounts of Liabilities Presented in the Balance Sheet |
Gross Amounts Not Offset in the Balance Sheet |
Amounts That Would Have Been Presented On Net Basis |
||||||||||||||||||||||||
Financial Instruments |
Cash Collateral Received |
Cash Collateral Paid |
||||||||||||||||||||||||||
(i) |
(ii) |
(iii) = (i) – (ii) |
(iv) |
(v) = (iii) + (iv) |
||||||||||||||||||||||||
As of June 30, 2022: |
||||||||||||||||||||||||||||
Commodity derivatives |
$ |
412 |
$ |
– |
$ |
412 |
$ |
(373 |
) |
$ |
– |
$ |
(33 |
) |
$ |
6 |
||||||||||||
As of December 31, 2021: |
||||||||||||||||||||||||||||
Commodity derivatives |
$ |
256 |
$ |
– |
$ |
256 |
$ |
(233 |
) |
$ |
– |
$ |
(17 |
) |
$ |
6 |
Derivatives in Fair Value Hedging Relationships |
Location |
Gain (Loss) Recognized in Income on Derivative |
|||||||||||||||
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
||||||||||||||||
2022 |
2021 |
2022 |
2021 |
||||||||||||||
Commodity derivatives |
Revenue |
$ |
(59 |
) |
$ |
(67 |
) |
$ |
(124 |
) |
$ |
(187 |
) |
||||
Total |
$ |
(59 |
) |
$ |
(67 |
) |
$ |
(124 |
) |
$ |
(187 |
) |
Derivatives in Fair Value Hedging Relationships |
Location |
Gain (Loss) Recognized in Income on Hedged Item |
|||||||||||||||
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
||||||||||||||||
2022 |
2021 |
2022 |
2021 |
||||||||||||||
Commodity derivatives |
Revenue |
$ |
4 |
$ |
39 |
$ |
25 |
$ |
209 |
||||||||
Total |
$ |
4 |
$ |
39 |
$ |
25 |
$ |
209 |
Derivatives in Cash Flow Hedging Relationships |
Change in Value Recognized in Other Comprehensive Income (Loss) on Derivative |
|||||||||||||||
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||
2022 |
2021 |
2022 |
2021 |
|||||||||||||
Interest rate derivatives |
$ |
– |
$ |
– |
$ |
– |
$ |
183 |
||||||||
Commodity derivatives – Revenue (1) |
23 |
(291 |
) |
(98 |
) |
(733 |
) |
|||||||||
Commodity derivatives – Operating costs and expenses (1) |
16 |
– |
38 |
(19 |
) |
|||||||||||
Total |
$ |
39 |
$ |
(291 |
) |
$ |
(60 |
) |
$ |
(569 |
) |
(1) |
The fair value of these derivative instruments will be reclassified to their respective locations on the Unaudited Condensed Statement of Consolidated Operations when the forecasted transactions affect earnings. |
Derivatives in Cash Flow Hedging Relationships |
Location |
Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) to Income |
|||||||||||||||
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
||||||||||||||||
2022 |
2021 |
2022 |
2021 |
||||||||||||||
Interest rate derivatives |
Interest expense |
$ |
(6 |
) |
$ |
(10 |
) |
$ |
(14 |
) |
$ |
(18 |
) |
||||
Commodity derivatives |
Revenue |
86 |
99 |
47 |
(498 |
) |
|||||||||||
Commodity derivatives |
Operating costs and expenses |
22 |
– |
16 |
(19 |
) |
|||||||||||
Total |
$ |
102 |
$ |
89 |
$ |
49 |
$ |
(535 |
) |
Derivatives Not Designated as Hedging Instruments |
Location |
Gain (Loss) Recognized in Income on Derivative |
|||||||||||||||
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
||||||||||||||||
2022 |
2021 |
2022 |
2021 |
||||||||||||||
Commodity derivatives |
Revenue |
$ |
2 |
$ |
79 |
$ |
45 |
$ |
36 |
||||||||
Commodity derivatives |
Operating costs and expenses |
3 |
(1 |
) |
7 |
– |
|||||||||||
Total |
$ |
5 |
$ |
78 |
$ |
52 |
$ |
36 |
At June 30, 2022 Fair Value Measurements Using |
||||||||||||||||
Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1) |
Significant Other Observable Inputs (Level 2) |
Significant Unobservable Inputs (Level 3) |
Total |
|||||||||||||
Financial assets: |
||||||||||||||||
Commodity derivatives: |
||||||||||||||||
Value before application of CME Rule 814 |
$ |
356 |
$ |
1,250 |
$ |
13 |
$ |
1,619 |
||||||||
Impact of CME Rule 814 |
(328 |
) |
(918 |
) |
– |
(1,246 |
) |
|||||||||
Total commodity derivatives |
28 |
332 |
13 |
373 |
||||||||||||
Total |
$ |
28 |
$ |
332 |
$ |
13 |
$ |
373 |
||||||||
Financial liabilities: |
||||||||||||||||
Commodity derivatives: |
||||||||||||||||
Value before application of CME Rule 814 |
$ |
505 |
$ |
1,185 |
$ |
21 |
$ |
1,711 |
||||||||
Impact of CME Rule 814 |
(476 |
) |
(823 |
) |
– |
(1,299 |
) |
|||||||||
Total commodity derivatives |
29 |
362 |
21 |
412 |
||||||||||||
Total |
$ |
29 |
$ |
362 |
$ |
21 |
$ |
412 |
At December 31, 2021 Fair Value Measurements Using |
||||||||||||||||
Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1) |
Significant Other Observable Inputs (Level 2) |
Significant Unobservable Inputs (Level 3) |
Total |
|||||||||||||
Financial assets: |
||||||||||||||||
Commodity derivatives: |
||||||||||||||||
Value before application of CME Rule 814 |
$ |
122 |
$ |
1,110 |
$ |
– |
$ |
1,232 |
||||||||
Impact of CME Rule 814 |
(122 |
) |
(871 |
) |
– |
(993 |
) |
|||||||||
Total commodity derivatives |
– |
239 |
– |
239 |
||||||||||||
Total |
$ |
– |
$ |
239 |
$ |
– |
$ |
239 |
||||||||
Financial liabilities: |
||||||||||||||||
Commodity derivatives: |
||||||||||||||||
Value before application of CME Rule 814 |
$ |
199 |
$ |
1,001 |
$ |
– |
$ |
1,200 |
||||||||
Impact of CME Rule 814 |
(199 |
) |
(745 |
) |
– |
(944 |
) |
|||||||||
Total commodity derivatives |
– |
256 |
– |
256 |
||||||||||||
Total |
$ |
– |
$ |
256 |
$ |
– |
$ |
256 |
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||
2022 |
2021 |
2022 |
2021 |
|||||||||||||
Revenues – related parties: |
||||||||||||||||
Unconsolidated affiliates |
$ |
19 |
$ |
9 |
$ |
35 |
$ |
23 |
||||||||
Costs and expenses – related parties: |
||||||||||||||||
EPCO and its privately held affiliates |
$ |
315 |
$ |
283 |
$ |
606 |
$ |
575 |
||||||||
Unconsolidated affiliates |
60 |
50 |
121 |
117 |
||||||||||||
Total |
$ |
375 |
$ |
333 |
$ |
727 |
$ |
692 |
June 30, 2022 |
December 31, 2021 |
|||||||
Accounts receivable - related parties: |
||||||||
EPCO and its privately held affiliates |
$ |
1 |
$ |
1 |
||||
Unconsolidated affiliates |
28 |
20 |
||||||
Total |
$ |
29 |
$ |
21 |
||||
Accounts payable - related parties: |
||||||||
EPCO and its privately held affiliates |
$ |
113 |
$ |
151 |
||||
Unconsolidated affiliates |
19 |
16 |
||||||
Total |
$ |
132 |
$ |
167 |
Total Number of Limited Partner Interests Held |
Percentage of Common Units Outstanding |
702,387,118 common units |
32.2% |
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||
2022 |
2021 |
2022 |
2021 |
|||||||||||||
Operating costs and expenses |
$ |
275 |
$ |
247 |
$ |
526 |
$ |
502 |
||||||||
General and administrative expenses |
36 |
31 |
72 |
64 |
||||||||||||
Total costs and expenses |
$ |
311 |
$ |
278 |
$ |
598 |
$ |
566 |
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||
2022 |
2021 |
2022 |
2021 |
|||||||||||||
Deferred tax expense attributable to OTA Holdings, Inc. (“OTA”) |
$ |
(7 |
) |
$ |
(7 |
) |
$ |
(14 |
) |
$ |
(13 |
) |
||||
Revised Texas Franchise Tax (“Texas Margin Tax”) |
(7 |
) |
(24 |
) |
(19 |
) |
(27 |
) |
||||||||
Other |
(3 |
) |
– |
(3 |
) |
(1 |
) |
|||||||||
Provision for income taxes |
$ |
(17 |
) |
$ |
(31 |
) |
$ |
(36 |
) |
$ |
(41 |
) |
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||
2022 |
2021 |
2022 |
2021 |
|||||||||||||
Current portion of income tax benefit (provision): |
||||||||||||||||
Federal |
$ |
– |
$ |
– |
$ |
– |
$ |
1 |
||||||||
State |
(7 |
) |
(12 |
) |
(17 |
) |
(17 |
) |
||||||||
Foreign |
(3 |
) |
– |
(3 |
) |
(1 |
) |
|||||||||
Total current portion |
(10 |
) |
(12 |
) |
(20 |
) |
(17 |
) |
||||||||
Deferred portion of income tax benefit (provision): |
||||||||||||||||
Federal |
(6 |
) |
(6 |
) |
(13 |
) |
(12 |
) |
||||||||
State |
(1 |
) |
(13 |
) |
(3 |
) |
(12 |
) |
||||||||
Total deferred portion |
(7 |
) |
(19 |
) |
(16 |
) |
(24 |
) |
||||||||
Total provision for income taxes |
$ |
(17 |
) |
$ |
(31 |
) |
$ |
(36 |
) |
$ |
(41 |
) |
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||
2022 |
2021 |
2022 |
2021 |
|||||||||||||
Pre-Tax Net Book Income (“NBI”) |
$ |
1,457 |
$ |
1,177 |
$ |
2,807 |
$ |
2,550 |
||||||||
Texas Margin Tax (1) |
(7 |
) |
(24 |
) |
(19 |
) |
(27 |
) |
||||||||
State income tax provision, net of federal benefit |
(1 |
) |
– |
(1 |
) |
(1 |
) |
|||||||||
Federal income tax provision computed by applying the federal statutory rate to NBI of corporate entities |
(4 |
) |
(4 |
) |
(7 |
) |
(7 |
) |
||||||||
Valuation allowance (2) |
(3 |
) |
(3 |
) |
(7 |
) |
(6 |
) |
||||||||
Other |
(2 |
) |
– |
(2 |
) |
– |
||||||||||
Provision for income taxes |
$ |
(17 |
) |
$ |
(31 |
) |
$ |
(36 |
) |
$ |
(41 |
) |
||||
Effective income tax rate |
(1.2 |
)% |
(2.6 |
)% |
(1.3 |
)% |
(1.6 |
)% |
(1) |
Although the Texas Margin Tax is not considered a state income tax, it has the characteristics of an income tax since it is determined by applying a tax rate to a base that considers our Texas-sourced revenues and expenses. |
(2) |
Management believes that it is more likely than not that the net deferred tax assets attributable to OTA will not be fully realizable. Accordingly, we provided for a valuation allowance against OTA’s net deferred tax assets. |
June 30, |
December 31, |
|||||||
2022 |
2021 |
|||||||
Deferred tax liabilities: |
||||||||
Attributable to investment in OTA |
$ |
398 |
$ |
384 |
||||
Attributable to property, plant and equipment |
120 |
118 |
||||||
Attributable to investments in other entities |
6 |
5 |
||||||
Other |
36 |
14 |
||||||
Total deferred tax liabilities |
560 |
521 |
||||||
Deferred tax assets: |
||||||||
Net operating loss carryovers (1) |
7 |
14 |
||||||
Temporary differences related to Texas Margin Tax |
4 |
3 |
||||||
Total deferred tax assets |
11 |
17 |
||||||
Valuation allowance |
7 |
14 |
||||||
Total deferred tax assets, net of valuation allowance |
4 |
3 |
||||||
Total net deferred tax liabilities |
$ |
556 |
$ |
518 |
(1) |
The loss amount presented as of June 30, 2022 has an indefinite carryover period. All losses are subject to limitations on their utilization. |
Asset Category |
ROU Asset Carrying Value (1) |
Lease Liability Carrying Value (2) |
Weighted- Average Remaining Term |
Weighted- Average Discount Rate (3) |
|||||
Storage and pipeline facilities |
$ |
185 |
$ |
186 |
10 years |
3.5% |
|||
Transportation equipment |
18 |
20 |
3 years |
2.9% |
|||||
Office and warehouse space |
162 |
194 |
15 years |
2.9% |
|||||
Total |
$ |
365 |
$ |
400 |
(1) |
ROU asset amounts are a component of “Other assets” on our Unaudited Condensed Consolidated Balance Sheet. |
(2) |
At June 30, 2022, lease liabilities of $55 million and $345 million were included within “Other current liabilities” and “Other long-term liabilities,” respectively. |
(3) |
The discount rate for each category of assets represents the weighted average of either (i) the implicit rate applicable to the underlying leases (where determinable) or (ii) our incremental borrowing rate adjusted for collateralization (if the implicit rate is not determinable). In general, the discount rates are based on either information available at the lease commencement date or January 1, 2019 for leases existing at the adoption date for ASC 842, Leases. |
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||
2022 |
2021 |
2022 |
2021 |
|||||||||||||
Long-term operating leases: |
||||||||||||||||
Fixed lease expense: |
||||||||||||||||
Non-cash lease expense (amortization of ROU assets) |
$ |
14 |
$ |
10 |
$ |
27 |
$ |
19 |
||||||||
Related accretion expense on lease liability balances |
3 |
3 |
6 |
6 |
||||||||||||
Total fixed lease expense |
17 |
13 |
33 |
25 |
||||||||||||
Variable lease expense |
1 |
– |
1 |
1 |
||||||||||||
Subtotal operating lease expense |
18 |
13 |
34 |
26 |
||||||||||||
Short-term operating leases |
23 |
13 |
40 |
26 |
||||||||||||
Total operating lease expense |
$ |
41 |
$ |
26 |
$ |
74 |
$ |
52 |
For the Six Months Ended June 30, |
||||||||
2022 |
2021 |
|||||||
Decrease (increase) in: |
||||||||
Accounts receivable – trade |
$ |
(1,355 |
) |
$ |
(689 |
) |
||
Accounts receivable – related parties |
(8 |
) |
(2 |
) |
||||
Inventories |
(467 |
) |
243 |
|||||
Prepaid and other current assets |
70 |
200 |
||||||
Other assets |
25 |
70 |
||||||
Increase (decrease) in: |
||||||||
Accounts payable – trade |
(38 |
) |
151 |
|||||
Accounts payable – related parties |
(35 |
) |
(53 |
) |
||||
Accrued product payables |
2,542 |
1,246 |
||||||
Accrued interest |
(18 |
) |
(12 |
) |
||||
Other current liabilities |
(457 |
) |
(726 |
) |
||||
Other long-term liabilities |
(41 |
) |
(29 |
) |
||||
Net effect of changes in operating accounts |
$ |
218 |
$ |
399 |
||||
Cash payments for interest, net of $38 and $41 capitalized during the six months ended June 30, 2022 and 2021, respectively |
$ |
624 |
$ |
624 |
||||
Cash payments (refunds) for federal and state income taxes |
$ |
(3 |
) |
$ |
17 |
• | natural gas gathering, treating, processing, transportation and storage; |
• | NGL transportation, fractionation, storage, and marine terminals (including those used to export liquefied petroleum gases (“LPG”) and ethane); |
• | crude oil gathering, transportation, storage, and marine terminals; |
• | propylene production facilities (including propane dehydrogenation (“PDH”) facilities), butane isomerization, octane enhancement, isobutane dehydrogenation (“iBDH”) and high purity isobutylene (“HPIB”) production facilities; |
• | petrochemical and refined products transportation, storage, and marine terminals (including those used to export ethylene and polymer grade propylene (“PGP”)); and |
• | a marine transportation business that operates on key U.S. inland and intracoastal waterway systems. |
• | our Plant 7 natural gas processing plant in the Midland Basin (first quarter of 2024); |
• | our Mentone III cryogenic natural gas processing plant (first quarter of 2024); and |
• | a 275 MBPD expansion of our Shin Oak NGL Pipeline (first half of 2024). |
• | a 400 MMcf/d expansion of our Acadian Gas System (second quarter of 2023); |
• | our Plant 6 natural gas processing plant in the Midland Basin (second quarter of 2023); |
• | a twelfth NGL fractionator (“Frac XII”) in Chambers County, Texas (third quarter of 2023); |
• | our Mentone II cryogenic natural gas processing plant (fourth quarter of 2023); |
• | our Texas Western Products System, created by repurposing a portion of our Mid-America Pipeline System’s Rocky Mountain segment and adding westbound service to our Chaparral Pipeline business to transport refined products from the U.S. Gulf Coast to markets in West Texas, New Mexico, Colorado and Utah (fourth quarter of 2023); |
• | an Ethane Terminal located along the coast between Corpus Christi, Texas and New Orleans, Louisiana (2025); and |
• | an expansion of our Morgan’s Point terminal to increase ethylene export capacity (2023 and 2025). |
Polymer |
Refinery |
Indicative Gas |
|||||||
Natural |
Normal |
Natural |
Grade |
Grade |
Processing |
||||
Gas, |
Ethane, |
Propane, |
Butane, |
Isobutane, |
Gasoline, |
Propylene, |
Propylene, |
Gross Spread |
|
$/MMBtu |
$/gallon |
$/gallon |
$/gallon |
$/gallon |
$/gallon |
$/pound |
$/pound |
$/gallon |
|
(1) |
(2) |
(2) |
(2) |
(2) |
(2) |
(3) |
(3) |
(4) |
|
2021 by quarter: |
|||||||||
1st Quarter |
$2.71 |
$0.24 |
$0.89 |
$0.94 |
$0.93 |
$1.33 |
$0.73 |
$0.44 |
$0.38 |
2nd Quarter |
$2.83 |
$0.26 |
$0.87 |
$0.97 |
$0.98 |
$1.46 |
$0.67 |
$0.27 |
$0.41 |
3rd Quarter |
$4.02 |
$0.35 |
$1.16 |
$1.34 |
$1.34 |
$1.62 |
$0.82 |
$0.36 |
$0.51 |
4th Quarter |
$5.84 |
$0.39 |
$1.24 |
$1.46 |
$1.46 |
$1.82 |
$0.66 |
$0.33 |
$0.41 |
2021 Averages |
$3.85 |
$0.31 |
$1.04 |
$1.18 |
$1.18 |
$1.56 |
$0.72 |
$0.35 |
$0.43 |
2022 by quarter: |
|||||||||
1st Quarter |
$4.96 |
$0.40 |
$1.30 |
$1.59 |
$1.60 |
$2.21 |
$0.63 |
$0.39 |
$0.55 |
2nd Quarter |
$7.17 |
$0.59 |
$1.24 |
$1.50 |
$1.68 |
$2.17 |
$0.61 |
$0.40 |
$0.46 |
2022 Averages |
$6.07 |
$0.50 |
$1.27 |
$1.55 |
$1.64 |
$2.19 |
$0.62 |
$0.40 |
$0.51 |
(1) |
Natural gas prices are based on Henry-Hub Inside FERC commercial index prices as reported by Platts, which is a division of S&P Global, Inc. |
(2) |
NGL prices for ethane, propane, normal butane, isobutane and natural gasoline are based on Mont Belvieu, Texas Non-TET commercial index prices as reported by Oil Price Information Service by IHS Markit (“IHS”). |
(3) |
Polymer grade propylene prices represent average contract pricing for such product as reported by IHS. Refinery grade propylene (“RGP”) prices represent weighted-average spot prices for such product as reported by IHS. |
(4) |
The “Indicative Gas Processing Gross Spread” represents our generic estimate of the gross economic benefit from extracting NGLs from natural gas production based on certain pricing assumptions. Specifically, it is the amount by which the assumed economic value of a composite gallon of NGLs in Chambers County, Texas exceeds the value of the equivalent amount of energy in natural gas at Henry Hub, Louisiana. Our estimate of the indicative spread does not consider the operating costs incurred by a natural gas processing facility to extract the NGLs nor the transportation and fractionation costs to deliver the NGLs to market. In addition, the actual gas processing spread earned at each plant is further influenced by regional pricing and extraction dynamics. |
WTI |
Midland |
Houston |
LLS |
|
Crude Oil, |
Crude Oil, |
Crude Oil |
Crude Oil, |
|
$/barrel |
$/barrel |
$/barrel |
$/barrel |
|
(1) |
(2) |
(2) |
(3) |
|
2021 by quarter: |
||||
1st Quarter |
$57.84 |
$59.00 |
$59.51 |
$59.99 |
2nd Quarter |
$66.07 |
$66.41 |
$66.90 |
$67.95 |
3rd Quarter |
$70.56 |
$70.74 |
$71.17 |
$71.51 |
4th Quarter |
$77.19 |
$77.82 |
$78.27 |
$78.41 |
2021 Averages |
$67.92 |
$68.49 |
$68.96 |
$69.47 |
2022 by quarter: |
||||
1st Quarter |
$94.29 |
$96.43 |
$96.77 |
$96.77 |
2nd Quarter |
$108.41 |
$109.66 |
$109.96 |
$110.17 |
2022 Averages |
$101.35 |
$103.05 |
$103.37 |
$103.47 |
(1) |
WTI prices are based on commercial index prices at Cushing, Oklahoma as measured by the NYMEX. |
(2) |
Midland and Houston crude oil prices are based on commercial index prices as reported by Argus. |
(3) |
Light Louisiana Sweet (“LLS”) prices are based on commercial index prices as reported by Platts. |
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||
2022 |
2021 |
2022 |
2021 |
|||||||||||||
Revenues |
$ |
16,060 |
$ |
9,450 |
$ |
29,068 |
$ |
18,605 |
||||||||
Costs and expenses: |
||||||||||||||||
Operating costs and expenses: |
||||||||||||||||
Cost of sales |
12,908 |
6,840 |
23,006 |
13,103 |
||||||||||||
Other operating costs and expenses |
884 |
702 |
1,641 |
1,417 |
||||||||||||
Depreciation, amortization and accretion expenses |
544 |
507 |
1,070 |
1,005 |
||||||||||||
Asset impairment charges |
5 |
18 |
19 |
84 |
||||||||||||
Net losses attributable to asset sales and related matters |
‒ |
‒ |
2 |
11 |
||||||||||||
Total operating costs and expenses |
14,341 |
8,067 |
25,738 |
15,620 |
||||||||||||
General and administrative costs |
62 |
52 |
124 |
108 |
||||||||||||
Total costs and expenses |
14,403 |
8,119 |
25,862 |
15,728 |
||||||||||||
Equity in income of unconsolidated affiliates |
107 |
161 |
224 |
310 |
||||||||||||
Operating income |
1,764 |
1,492 |
3,430 |
3,187 |
||||||||||||
Other income (expense): |
||||||||||||||||
Interest expense |
(309 |
) |
(316 |
) |
(628 |
) |
(639 |
) |
||||||||
Other, net |
2 |
1 |
5 |
2 |
||||||||||||
Total other expense, net |
(307 |
) |
(315 |
) |
(623 |
) |
(637 |
) |
||||||||
Income before income taxes |
1,457 |
1,177 |
2,807 |
2,550 |
||||||||||||
Provision for income taxes |
(17 |
) |
(31 |
) |
(36 |
) |
(41 |
) |
||||||||
Net income |
1,440 |
1,146 |
2,771 |
2,509 |
||||||||||||
Net income attributable to noncontrolling interests |
(28 |
) |
(33 |
) |
(62 |
) |
(54 |
) |
||||||||
Net income attributable to preferred units |
(1 |
) |
(1 |
) |
(2 |
) |
(2 |
) |
||||||||
Net income attributable to common unitholders |
$ |
1,411 |
$ |
1,112 |
$ |
2,707 |
$ |
2,453 |
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||
2022 |
2021 |
2022 |
2021 |
|||||||||||||
NGL Pipelines & Services: |
||||||||||||||||
Sales of NGLs and related products |
$ |
5,580 |
$ |
2,976 |
$ |
10,620 |
$ |
5,982 |
||||||||
Midstream services |
800 |
611 |
1,514 |
1,189 |
||||||||||||
Total |
6,380 |
3,587 |
12,134 |
7,171 |
||||||||||||
Crude Oil Pipelines & Services: |
||||||||||||||||
Sales of crude oil |
5,031 |
2,139 |
8,747 |
3,978 |
||||||||||||
Midstream services |
354 |
365 |
710 |
691 |
||||||||||||
Total |
5,385 |
2,504 |
9,457 |
4,669 |
||||||||||||
Natural Gas Pipelines & Services: |
||||||||||||||||
Sales of natural gas |
1,359 |
476 |
2,239 |
1,811 |
||||||||||||
Midstream services |
302 |
233 |
571 |
485 |
||||||||||||
Total |
1,661 |
709 |
2,810 |
2,296 |
||||||||||||
Petrochemical & Refined Products Services: |
||||||||||||||||
Sales of petrochemicals and refined products |
2,370 |
2,386 |
4,124 |
3,985 |
||||||||||||
Midstream services |
264 |
264 |
543 |
484 |
||||||||||||
Total |
2,634 |
2,650 |
4,667 |
4,469 |
||||||||||||
Total consolidated revenues |
$ |
16,060 |
$ |
9,450 |
$ |
29,068 |
$ |
18,605 |
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||
2022 |
2021 |
2022 |
2021 |
|||||||||||||
Interest charged on debt principal outstanding |
$ |
318 |
$ |
321 |
$ |
641 |
$ |
648 |
||||||||
Impact of interest rate hedging program, including related amortization |
6 |
10 |
14 |
18 |
||||||||||||
Interest costs capitalized in connection with construction projects (1) |
(21 |
) |
(21 |
) |
(38 |
) |
(41 |
) |
||||||||
Other (2) |
6 |
6 |
11 |
14 |
||||||||||||
Total |
$ |
309 |
$ |
316 |
$ |
628 |
$ |
639 |
(1) |
We capitalize interest costs incurred on funds used to construct property, plant and equipment while the asset is in its construction phase. Capitalized interest amounts become part of the historical cost of an asset and are charged to earnings (as a component of depreciation expense) on a straight-line basis over the estimated useful life of the asset once the asset enters its intended service. When capitalized interest is recorded, it reduces interest expense from what it would be otherwise. Capitalized interest amounts fluctuate based on the timing of when projects are placed into service, our capital investment levels and the interest rates charged on borrowings. |
(2) |
Primarily reflects facility commitment fees charged in connection with our revolving credit facilities and amortization of debt issuance costs. |
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||
2022 |
2021 |
2022 |
2021 |
|||||||||||||
Gross operating margin by segment: |
||||||||||||||||
NGL Pipelines & Services |
$ |
1,327 |
$ |
1,098 |
$ |
2,552 |
$ |
2,184 |
||||||||
Crude Oil Pipelines & Services |
407 |
419 |
822 |
819 |
||||||||||||
Natural Gas Pipelines & Services |
229 |
202 |
449 |
737 |
||||||||||||
Petrochemical & Refined Products Services |
421 |
326 |
825 |
608 |
||||||||||||
Total segment gross operating margin (1) |
2,384 |
2,045 |
4,648 |
4,348 |
||||||||||||
Net adjustment for shipper make-up rights |
(22 |
) |
17 |
(28 |
) |
37 |
||||||||||
Total gross operating margin (non-GAAP) |
$ |
2,362 |
$ |
2,062 |
$ |
4,620 |
$ |
4,385 |
(1) |
Within the context of this table, total segment gross operating margin represents a subtotal and corresponds to measures similarly titled within our business segment disclosures found under Note 10 of the Notes to Unaudited Condensed Consolidated Financial Statements included under Part I, Item 1 of this quarterly report. |
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||
2022 |
2021 |
2022 |
2021 |
|||||||||||||
Operating income |
$ |
1,764 |
$ |
1,492 |
$ |
3,430 |
$ |
3,187 |
||||||||
Adjustments to reconcile operating income to total gross operating margin (addition or subtraction indicated by sign): |
||||||||||||||||
Depreciation, amortization and accretion expense in operating costs and expenses (1) |
531 |
500 |
1,045 |
995 |
||||||||||||
Asset impairment charges in operating costs and expenses |
5 |
18 |
19 |
84 |
||||||||||||
Net losses attributable to asset sales and related matters in operating costs and expenses |
‒ |
‒ |
2 |
11 |
||||||||||||
General and administrative costs |
62 |
52 |
124 |
108 |
||||||||||||
Total gross operating margin (non-GAAP) |
$ |
2,362 |
$ |
2,062 |
$ |
4,620 |
$ |
4,385 |
(1) |
Excludes amortization of major maintenance costs for reaction-based plants, which are a component of gross operating margin. |
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||
2022 |
2021 |
2022 |
2021 |
|||||||||||||
Segment gross operating margin: |
||||||||||||||||
Natural gas processing and related NGL marketing activities |
$ |
587 |
$ |
286 |
$ |
1,002 |
$ |
580 |
||||||||
NGL pipelines, storage and terminals |
539 |
555 |
1,105 |
1,182 |
||||||||||||
NGL fractionation |
201 |
257 |
445 |
422 |
||||||||||||
Total |
$ |
1,327 |
$ |
1,098 |
$ |
2,552 |
$ |
2,184 |
||||||||
Selected volumetric data: |
||||||||||||||||
NGL pipeline transportation volumes (MBPD) |
3,683 |
3,435 |
3,626 |
3,383 |
||||||||||||
NGL marine terminal volumes (MBPD) |
747 |
665 |
696 |
659 |
||||||||||||
NGL fractionation volumes (MBPD) |
1,336 |
1,245 |
1,327 |
1,216 |
||||||||||||
Equity NGL-equivalent production volumes (MBPD) (1) |
195 |
198 |
189 |
180 |
||||||||||||
Fee-based natural gas processing volumes (MMcf/d) (2,3) |
5,133 |
4,187 |
5,025 |
4,102 |
(1) |
Primarily represents the NGL and condensate volumes we earn and take title to in connection with our processing activities. The total equity NGL-equivalent production volumes also include residue natural gas volumes from our natural gas processing business. |
(2) |
Volumes reported correspond to the revenue streams earned by our natural gas processing plants. |
(3) |
Fee-based natural gas processing volumes are measured at either the wellhead or plant inlet in MMcf/d. |
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||
2022 |
2021 |
2022 |
2021 |
|||||||||||||
Segment gross operating margin: |
||||||||||||||||
Midland-to-ECHO System and related business activities |
$ |
95 |
$ |
96 |
$ |
196 |
$ |
175 |
||||||||
Other crude oil pipelines, terminals and related marketing results |
312 |
323 |
626 |
644 |
||||||||||||
Total |
$ |
407 |
$ |
419 |
$ |
822 |
$ |
819 |
||||||||
Selected volumetric data: |
||||||||||||||||
Crude oil pipeline transportation volumes (MBPD) |
2,197 |
2,041 |
2,197 |
1,988 |
||||||||||||
Crude oil marine terminal volumes (MBPD) |
777 |
770 |
786 |
671 |
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||
2022 |
2021 |
2022 |
2021 |
|||||||||||||
Segment gross operating margin |
$ |
229 |
$ |
202 |
$ |
449 |
$ |
737 |
||||||||
Selected volumetric data: |
||||||||||||||||
Natural gas pipeline transportation volumes (BBtus/d) |
16,803 |
14,161 |
16,629 |
13,934 |
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||
2022 |
2021 |
2022 |
2021 |
|||||||||||||
Segment gross operating margin: |
||||||||||||||||
Propylene production and related activities |
$ |
154 |
$ |
204 |
$ |
364 |
$ |
350 |
||||||||
Butane isomerization and related operations |
28 |
14 |
54 |
25 |
||||||||||||
Octane enhancement and related plant operations |
144 |
18 |
204 |
34 |
||||||||||||
Refined products pipelines and related activities |
56 |
69 |
127 |
171 |
||||||||||||
Ethylene exports and related activities |
28 |
15 |
60 |
21 |
||||||||||||
Marine transportation and other services |
11 |
6 |
16 |
7 |
||||||||||||
Total |
$ |
421 |
$ |
326 |
$ |
825 |
$ |
608 |
||||||||
Selected volumetric data: |
||||||||||||||||
Propylene production volumes (MBPD) |
109 |
113 |
107 |
99 |
||||||||||||
Butane isomerization volumes (MBPD) |
115 |
84 |
103 |
74 |
||||||||||||
Standalone deisobutanizer (“DIB”) processing volumes (MBPD) |
162 |
173 |
156 |
156 |
||||||||||||
Octane enhancement and related plant sales volumes (MBPD) (1) |
42 |
31 |
38 |
30 |
||||||||||||
Pipeline transportation volumes, primarily refined products and petrochemicals (MBPD) |
751 |
977 |
749 |
859 |
||||||||||||
Marine terminal volumes, primarily refined products and petrochemicals (MBPD) |
225 |
198 |
217 |
233 |
(1) |
Reflects aggregate sales volumes for our octane enhancement and iBDH facilities located at our Chambers County complex and our HPIB facility located adjacent to the Houston Ship Channel. |
Scheduled Maturities of Debt |
||||||||||||||||||||||||||||
Total |
Remainder of 2022 |
2023 |
2024 |
2025 |
2026 |
Thereafter |
||||||||||||||||||||||
Commercial Paper Notes |
$ |
640 |
$ |
640 |
$ |
– |
$ |
– |
$ |
– |
$ |
– |
$ |
– |
||||||||||||||
Senior Notes |
25,775 |
– |
1,250 |
850 |
1,150 |
875 |
21,650 |
|||||||||||||||||||||
Junior Subordinated Notes |
2,646 |
– |
– |
– |
– |
– |
2,646 |
|||||||||||||||||||||
Total |
$ |
29,061 |
$ |
640 |
$ |
1,250 |
$ |
850 |
$ |
1,150 |
$ |
875 |
$ |
24,296 |
For the Six Months Ended June 30, |
||||||||
2022 |
2021 |
|||||||
Net cash flows provided by operating activities |
$ |
4,264 |
$ |
4,017 |
||||
Cash used in investing activities |
3,868 |
1,229 |
||||||
Cash used in financing activities |
2,964 |
3,335 |
• | a $466 million period-to-period increase resulting from higher partnership earnings (determined by adjusting our $262 million period-to-period increase in net income for changes in the non-cash items identified on our Unaudited Condensed Statements of Consolidated Cash Flows); partially offset by |
• | a $181 million period-to-period decrease primarily due to the timing of cash receipts and payments related to operations. |
• | a net $3.2 billion cash outflow in February 2022 in connection with the acquisition of Navitas Midstream; partially offset by |
• | a $570 million period-to-period decrease in investments for property, plant and equipment (see “Capital Investments” within this Part I, Item 2 for additional information). |
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||
2022 |
2021 |
2022 |
2021 |
|||||||||||||
Net income attributable to common unitholders (GAAP) (1) |
$ |
1,411 |
$ |
1,112 |
$ |
2,707 |
$ |
2,453 |
||||||||
Adjustments to net income attributable to common unitholders to derive DCF (addition or subtraction indicated by sign): |
||||||||||||||||
Depreciation, amortization and accretion expenses |
566 |
534 |
1,117 |
1,059 |
||||||||||||
Cash distributions received from unconsolidated affiliates (2) |
159 |
168 |
279 |
299 |
||||||||||||
Equity in income of unconsolidated affiliates |
(107 |
) |
(161 |
) |
(224 |
) |
(310 |
) |
||||||||
Asset impairment charges |
5 |
18 |
19 |
84 |
||||||||||||
Change in fair market value of derivative instruments |
52 |
(23 |
) |
94 |
(39 |
) |
||||||||||
Deferred income tax expense (benefit) |
7 |
19 |
16 |
24 |
||||||||||||
Sustaining capital expenditures (3) |
(82 |
) |
(117 |
) |
(157 |
) |
(261 |
) |
||||||||
Other, net (4) |
4 |
5 |
(10 |
) |
(98 |
) |
||||||||||
Operational DCF (5) |
$ |
2,015 |
$ |
1,555 |
$ |
3,841 |
$ |
3,211 |
||||||||
Proceeds from asset sales |
3 |
44 |
14 |
50 |
||||||||||||
Monetization of interest rate derivative instruments accounted for as cash flow hedges |
‒ |
‒ |
‒ |
75 |
||||||||||||
DCF (non-GAAP) |
$ |
2,018 |
$ |
1,599 |
$ |
3,855 |
$ |
3,336 |
||||||||
Cash distributions paid to common unitholders with respect to period, including distribution equivalent rights on phantom unit awards |
$ |
1,044 |
$ |
991 |
$ |
2,067 |
$ |
1,982 |
||||||||
Cash distribution per common unit declared by Enterprise GP with respect to period (6) |
$ |
0.4750 |
$ |
0.4500 |
$ |
0.9400 |
$ |
0.9000 |
||||||||
Total DCF retained by the Partnership with respect to period (7) |
$ |
974 |
$ |
608 |
$ |
1,788 |
$ |
1,354 |
||||||||
Distribution coverage ratio (8) |
1.9 |
x |
1.6 |
x |
1.9 |
x |
1.7 |
x |
(1) |
For a discussion of the primary drivers of changes in our comparative income statement amounts, see “Income Statement Highlights” within this Part I, Item 2. |
(2) |
Reflects aggregate distributions received from unconsolidated affiliates attributable to both earnings and the return of capital. |
(3) |
Sustaining capital expenditures include cash payments and accruals applicable to the period. |
(4) |
The six months ended June 30, 2021 includes $100 million of trade accounts receivable that we do not expect to collect in the normal billing cycle. |
(5) |
Represents DCF before proceeds from asset sales and the monetization of interest rate derivative instruments accounted for as cash flow hedges. |
(6) |
See Note 8 of the Notes to Unaudited Condensed Consolidated Financial Statements included under Part I, Item 1 of this quarterly report for information regarding our cash distributions declared with respect to the periods indicated. |
(7) |
Cash retained by the Partnership may be used for capital investments, debt service, working capital, operating expenses, common unit repurchases, commitments and contingencies and other amounts. The retention of cash reduces our reliance on the capital markets. |
(8) |
Distribution coverage ratio is determined by dividing DCF by total cash distributions paid to common unitholders and in connection with distribution equivalent rights with respect to the period. |
For the Three Months Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||
2022 |
2021 |
2022 |
2021 |
|||||||||||||
Net cash flows provided by operating activities (GAAP) |
$ |
2,119 |
$ |
1,994 |
$ |
4,264 |
$ |
4,017 |
||||||||
Adjustments to reconcile net cash flows provided by operating activities to DCF (addition or subtraction indicated by sign): |
||||||||||||||||
Net effect of changes in operating accounts |
(27 |
) |
(300 |
) |
(218 |
) |
(399 |
) |
||||||||
Sustaining capital expenditures |
(82 |
) |
(117 |
) |
(157 |
) |
(261 |
) |
||||||||
Distributions received from unconsolidated affiliates attributable to the return of capital |
44 |
18 |
55 |
37 |
||||||||||||
Proceeds from asset sales |
3 |
44 |
14 |
50 |
||||||||||||
Net income attributable to noncontrolling interests |
(28 |
) |
(33 |
) |
(62 |
) |
(54 |
) |
||||||||
Monetization of interest rate derivative instruments accounted for as cash flow hedges |
‒ |
‒ |
‒ |
75 |
||||||||||||
Other, net |
(11 |
) |
(7 |
) |
(41 |
) |
(129 |
) |
||||||||
DCF (non-GAAP) |
$ |
2,018 |
$ |
1,599 |
$ |
3,855 |
$ |
3,336 |
• | natural gas gathering expansion projects in the Delaware and Midland Basins (2022 and 2023); |
• | our PDH 2 facility (second quarter of 2023); |
• | a 400 MMcf/d expansion of our Acadian Gas System (second quarter of 2023); |
• | our Plant 6 natural gas processing plant in the Midland Basin (second quarter of 2023); |
• | a twelfth NGL fractionator (“Frac XII”) in Chambers County, Texas (third quarter of 2023); |
• | our Mentone II cryogenic natural gas processing plant (fourth quarter of 2023); |
• | our Texas Western Products System, created by repurposing a portion of our Mid-America Pipeline System’s Rocky Mountain segment and adding westbound service to our Chaparral Pipeline business to transport refined products from the U.S. Gulf Coast to markets in West Texas, New Mexico, Colorado and Utah (fourth quarter of 2023); |
• | our Mentone III cryogenic natural gas processing plant (first quarter of 2024); |
• | our Plant 7 natural gas processing plant in the Midland Basin (first quarter of 2024); |
• | the expansion of our Shin Oak NGL Pipeline (first half of 2024); |
• | an Ethane Terminal located along the coast between Corpus Christi, Texas and New Orleans, Louisiana (2025); and |
• | an expansion of our Morgan’s Point terminal to increase ethylene export capacity (2023 and 2025). |
For the Six Months Ended June 30, |
||||||||
2022 |
2021 |
|||||||
Capital investments for property, plant and equipment: (1) |
||||||||
Growth capital projects (2) |
$ |
564 |
$ |
1,050 |
||||
Sustaining capital projects (3) |
167 |
251 |
||||||
Total |
$ |
731 |
$ |
1,301 |
||||
Cash used for business combinations, net (4) |
$ |
3,204 |
$ |
– |
||||
Investments in unconsolidated affiliates |
$ |
– |
$ |
1 |
(1) |
Growth and sustaining capital amounts presented in the table above are presented on a cash basis. In total, these amounts represent “Capital expenditures” as presented on our Unaudited Condensed Statements of Consolidated Cash Flows. |
(2) |
Growth capital projects either (a) result in new sources of cash flow due to enhancements of or additions to existing assets (e.g., additional revenue streams, cost savings resulting from debottlenecking of a facility, etc.) or (b) expand our asset base through construction of new facilities that will generate additional revenue streams and cash flows. |
(3) |
Sustaining capital projects are capital expenditures (as defined by GAAP) resulting from improvements to existing assets. Such expenditures serve to maintain existing operations but do not generate additional revenues or result in significant cost savings. Sustaining capital expenditures include the costs of major maintenance activities at our reaction-based plants, which are accounted for using the deferral method. |
(4) |
Amount for the six months ended June 30, 2022 represents net cash used for the acquisition of Navitas Midstream, which closed on February 17, 2022. |
• | lower investments at our Chambers County complex (e.g., completion of our natural gasoline hydrotreater in October 2021), which accounted for a $144 million decrease; |
• | completion of our Gillis Lateral natural gas pipeline in December 2021, which accounted for a $105 million decrease; |
• | completion of pipeline projects connecting our Chambers County complex with Gulf Coast assets, which accounted for a $73 million decrease; |
• | lower investments in projects attributable to our ethylene business (e.g. completion of our Baymark ethylene pipeline in November 2021), which accounted for a $55 million decrease; and |
• | completion of projects associated with crude oil pipelines (e.g., expansion projects involving the Midland-to-ECHO System and related crude oil infrastructure supporting Permian Basin producers), which accounted for a $36 million decrease. |
• | depreciation methods and estimated useful lives of property, plant and equipment; |
• | measuring recoverability of long-lived assets and fair value of equity method investments; |
• | valuation and amortization methods of customer relationships and contract-based intangible assets; |
• | methods we employ to measure the fair value of goodwill and related assets; and |
• | the use of estimates for revenue and expenses. |
Selected asset information: |
June 30, 2022 |
December 31, 2021 |
||||||
Current receivables from Non-Obligor Subsidiaries |
$ |
1,217 |
$ |
358 |
||||
Other current assets |
6,434 |
7,994 |
||||||
Long-term receivables from Non-Obligor Subsidiaries |
187 |
187 |
||||||
Other noncurrent assets, excluding investments in Non-Obligor Subsidiaries of $48.0 billion at June 30, 2022 and $45.9 billion at December 31, 2021 |
9,108 |
8,791 |
||||||
Selected liability information: |
||||||||
Current portion of Guaranteed Debt, including interest of $435 million at June 30, 2022 and $453 million at December 31, 2021 |
$ |
2,324 |
$ |
1,853 |
||||
Current payables to Non-Obligor Subsidiaries |
2,513 |
1,829 |
||||||
Other current liabilities |
5,808 |
4,743 |
||||||
Noncurrent portion of Guaranteed Debt, principal only |
27,157 |
28,407 |
||||||
Noncurrent payables to Non-Obligor Subsidiaries |
38 |
27 |
||||||
Other noncurrent liabilities |
79 |
48 |
||||||
Mezzanine equity of Obligor Group: |
||||||||
Preferred units |
$ |
49 |
$ |
49 |
For the Six Months Ended June 30, 2022 |
For the Twelve Months Ended December 31, 2021 |
|||||||
Revenues from Non-Obligor Subsidiaries |
$ |
6,269 |
$ |
13,114 |
||||
Revenues from other sources |
14,500 |
16,676 |
||||||
Operating income of Obligor Group |
463 |
1,490 |
||||||
Net income (loss) of Obligor Group excluding equity in earnings of Non-Obligor Subsidiaries of $2.9 billion for the six months ended June 30, 2022 and $4.5 billion for the twelve months ended December 31, 2021 |
(195 |
) |
145 |
• | the derivative instrument functions effectively as a hedge of the underlying risk; |
• | the derivative instrument is not closed out in advance of its expected term; and |
• | the hedged forecasted transaction occurs within the expected time period. |
Portfolio Fair Value at |
|||||||||||||
Scenario |
Resulting Classification |
December 31, 2021 |
June 30, 2022 |
July 15, 2022 |
|||||||||
Fair value assuming no change in underlying commodity prices |
Asset (Liability) |
$ |
9 |
$ |
19 |
$ |
(1 |
) |
|||||
Fair value assuming 10% increase in underlying commodity prices |
Asset (Liability) |
9 |
18 |
(3 |
) |
||||||||
Fair value assuming 10% decrease in underlying commodity prices |
Asset (Liability) |
9 |
19 |
1 |
Portfolio Fair Value at |
|||||||||||||
Scenario |
Resulting Classification |
December 31, 2021 |
June 30, 2022 |
July15, 2022 |
|||||||||
Fair value assuming no change in underlying commodity prices |
Asset (Liability) |
$ |
84 |
$ |
(31 |
) |
$ |
(41 |
) |
||||
Fair value assuming 10% increase in underlying commodity prices |
Asset (Liability) |
77 |
(52 |
) |
(53 |
) |
|||||||
Fair value assuming 10% decrease in underlying commodity prices |
Asset (Liability) |
91 |
(10 |
) |
(30 |
) |
Portfolio Fair Value at |
|||||||||||||
Scenario |
Resulting Classification |
December 31, 2021 |
June 30, 2022 |
July 15, 2022 |
|||||||||
Fair value assuming no change in underlying commodity prices |
Asset (Liability) |
$ |
(55 |
) |
$ |
(84 |
) |
$ |
(28 |
) |
|||
Fair value assuming 10% increase in underlying commodity prices |
Asset (Liability) |
(120 |
) |
(139 |
) |
(61 |
) |
||||||
Fair value assuming 10% decrease in underlying commodity prices |
Asset (Liability) |
11 |
(29 |
) |
5 |
(i) | that our disclosure controls and procedures are designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our principal executive and financial officers, as appropriate to allow for timely decisions regarding required disclosures; and |
(ii) | that our disclosure controls and procedures are effective. |
• | we may be unable to complete construction projects on schedule or at the budgeted cost due to the unavailability of required construction personnel, the unavailability of or delays in obtaining necessary materials as a result of supply chain disruptions (including those caused by COVID-19 lockdowns or geopolitical events, such as the Russian invasion of Ukraine), accidents, weather conditions, or an inability to obtain necessary permits; |
• | we will not receive any material increase in operating cash flows until the project is completed, even though we may have expended considerable funds during the construction phase, which may be prolonged; |
• | we may construct facilities to capture anticipated future production growth in a region in which such growth does not materialize; |
• | since we are not engaged in the exploration for and development of crude oil or natural gas reserves, we may not have access to third party estimates of reserves in an area prior to our constructing facilities in the area. As a result, we may construct facilities in an area where the reserves are materially lower than we anticipate; |
• | in those situations where we do rely on third party reserve estimates in making a decision to construct assets, these estimates may prove inaccurate; |
• | the completion or success of our construction project may depend on the completion of a third party construction project (e.g., a downstream crude oil refinery expansion or construction of a new petrochemical facility) that we do not control and that may be subject to numerous of its own potential risks, delays and complexities; and |
• | we may be unable to obtain rights-of-way to construct additional pipelines or the cost to do so may be uneconomical. |
Period |
Total Number of Units Purchased |
Average Price Paid per Unit |
Total Number Of Units Purchased as Part of 2019 Buyback Program |
Remaining Dollar Amount of Units That May Be Purchased Under the 2019 Buyback Program ($ thousands) |
||||||||||||
2019 Buyback Program: (1) |
||||||||||||||||
April 2022 |
– |
$ |
– |
– |
$ |
1,519,128 |
||||||||||
May 2022 |
707,149 |
$ |
25.74 |
707,149 |
$ |
1,500,924 |
||||||||||
June 2022 |
700,972 |
$ |
24.17 |
700,972 |
$ |
1,483,983 |
||||||||||
Vesting of phantom unit awards: |
||||||||||||||||
April 2022 |
– |
$ |
– |
n/a |
n/a |
|||||||||||
May 2022 (2) |
71,976 |
$ |
25.74 |
n/a |
n/a |
|||||||||||
June 2022 (3) |
1,699 |
$ |
26.15 |
n/a |
n/a |
(1) |
In January 2019, we announced the 2019 Buyback Program, which authorized the repurchase of up to $2 billion of EPD’s common units. Units repurchased under this program are cancelled immediately upon acquisition. |
(2) |
Of the 272,157 phantom unit awards that vested in May 2022 and converted to common units, 71,976 units were sold back to us by employees to cover related withholding tax requirements. These repurchases are not part of any announced program. We cancelled these units immediately upon acquisition. |
(3) |
Of the 5,875 phantom unit awards that vested in June 2022 and converted to common units, 1,699 units were sold back to us by employees to cover related withholding tax requirements. These repurchases are not part of any announced program. We cancelled these units immediately upon acquisition. |
Exhibit Number |
Exhibit* |
2.1 |
|
2.2 |
|
2.3 |
|
2.4 |
|
2.5 |
|
2.6 |
|
2.7 |
2.8 |
|
2.9 |
|
2.10 |
|
2.11 |
|
2.12 |
|
2.13 |
|
2.14 |
|
3.1 |
|
3.2 |
|
3.3 |
|
3.4 |
|
3.5 |
|
3.6 |
|
3.7 |
|
3.8 |
|
3.9# |
|
3.10 |
|
3.11 |
3.12 |
|
4.1 |
|
4.2 |
|
4.3 |
|
4.4 |
|
4.5 |
|
4.6 |
|
4.7 |
|
4.8 |
|
4.9 |
|
4.10 |
|
4.11 |
|
4.12 |
|
4.13 |
|
4.14 |
4.15 |
|
4.16 |
|
4.17 |
|
4.18 |
|
4.19 |
|
4.20 |
|
4.21 |
|
4.22 |
|
4.23 |
|
4.24 |
|
4.25 |
|
4.26 |
|
4.27 |
4.28 |
|
4.29 |
|
4.30 |
|
4.31 |
|
4.32 |
|
4.33 |
|
4.34 |
|
4.35 |
|
4.36 |
|
4.37 |
|
4.38 |
|
4.39 |
|
4.40 |
|
4.41 |
|
4.42 |
|
4.43 |
4.44 |
|
4.45 |
|
4.46 |
|
4.47 |
|
4.48 |
|
4.49 |
|
4.50 |
|
4.51 |
|
4.52 |
|
4.53 |
|
4.54 |
|
4.55 |
|
4.56 |
|
4.57 |
|
4.58 |
|
4.59 |
|
4.60 |
4.61 |
|
4.62 |
|
4.63 |
|
4.64 |
|
4.65 |
|
4.66 |
|
4.67 |
|
4.68 |
|
4.69 |
|
4.70 |
|
4.71 |
|
4.72 |
|
4.73 |
|
4.74 |
|
4.75 |
4.76 |
|
4.77 |
|
4.78 |
|
4.79 |
|
4.80 |
|
4.81 |
|
4.82 |
|
4.83 |
|
4.84 |
|
4.85 |
|
4.86 |
|
4.87 |
22.1# |
|
31.1# |
|
31.2# |
|
32.1# |
|
32.2# |
|
101# |
Interactive data files pursuant to Rule 405 of Regulation S-T formatted in iXBRL (Inline Extensible Business Reporting Language) in this Form 10-Q include the: (i) Unaudited Condensed Consolidated Balance Sheets, (ii) Unaudited Condensed Statements of Consolidated Operations, (iii) Unaudited Condensed Statements of Consolidated Comprehensive Income, (iv) Unaudited Condensed Statements of Consolidated Cash Flows, (v) Unaudited Condensed Statements of Consolidated Equity and (vi) Notes to the Unaudited Condensed Consolidated Financial Statements. |
104# |
Cover Page Interactive Data File (embedded within the iXBRL document). |
* |
With respect to any exhibits incorporated by reference to any Exchange Act filings, the Commission file numbers for Enterprise Products Partners L.P., Enterprise GP Holdings L.P, TEPPCO Partners, L.P. and TE Products Pipeline Company, LLC are 1-14323, 1-32610, 1-10403 and 1-13603, respectively. |
*** |
Identifies management contract and compensatory plan arrangements. |
# |
Filed with this report. |
ENTERPRISE PRODUCTS PARTNERS L.P. (A Delaware Limited Partnership) |
|||
By: |
Enterprise Products Holdings LLC, as General Partner |
||
By: |
/s/ R. Daniel Boss |
||
Name: |
R. Daniel Boss |
||
Title: |
Executive Vice President – Accounting, Risk Control and Information Technology of the General Partner |
||
ARTICLE 1 DEFINITIONS
|
2
|
1.01 Definitions.
|
2
|
1.02 Construction.
|
2
|
ARTICLE 2 ORGANIZATION
|
2
|
2.01 Formation.
|
2
|
2.02 Name.
|
2
|
2.03 Registered Office; Registered Agent; Principal Office; Other Offices.
|
2
|
2.04 Purpose.
|
3
|
2.05 Term.
|
3
|
2.06 No State-Law Partnership; Withdrawal.
|
3
|
2.07 Certain Undertakings Relating to the Separateness of the MLP.
|
3
|
ARTICLE 3 MATTERS RELATING TO MEMBERS
|
5
|
3.01 Members.
|
5
|
3.02 Creation of Additional Membership Interest.
|
5
|
3.03 Liability to Third Parties.
|
5
|
ARTICLE 4 CAPITAL CONTRIBUTIONS
|
5
|
4.01 Capital Contributions.
|
5
|
4.02 Loans.
|
6
|
4.03 Return of Contributions.
|
6
|
ARTICLE 5 DISTRIBUTIONS AND ALLOCATIONS
|
6
|
5.01 Distributions.
|
6
|
ARTICLE 6 MANAGEMENT
|
6
|
6.01 Management.
|
6
|
6.02 Board of Directors.
|
8
|
6.03 Officers.
|
11
|
6.04 Duties of Officers and Directors.
|
14
|
6.05 Compensation.
|
14
|
6.06 Indemnification.
|
14
|
6.07 Liability of Indemnitees.
|
16
|
6.08 Conflicts of Interest Limitations.
|
17
|
ARTICLE 7 TAX MATTERS
|
18
|
7.01 Tax Returns.
|
18
|
7.02 Tax Audit Matters.
|
18
|
ARTICLE 8 BOOKS, RECORDS, REPORTS, AND BANK ACCOUNTS
|
19
|
8.01 Maintenance of Books.
|
19
|
8.02 Reports.
|
19
|
8.03 Bank Accounts.
|
19
|
8.04 Tax Statements.
|
19
|
ARTICLE 9 [RESERVED]
|
20
|
ARTICLE 10 [RESERVED]
|
20
|
ARTICLE 11 DISSOLUTION, WINDING-UP AND TERMINATION
|
20
|
11.01 Dissolution.
|
20
|
11.02 Winding-Up and Termination.
|
20
|
ARTICLE 12 MERGER
|
21
|
12.01 Authority.
|
21
|
12.02 Procedure for Merger or Consolidation.
|
21
|
12.03 Approval by Members of Merger or Consolidation.
|
22
|
12.04 Certificate of Merger or Consolidation.
|
23
|
12.05 Effect of Merger or Consolidation.
|
23 |
ARTICLE 13 GENERAL PROVISIONS
|
23
|
13.01 Notices.
|
23
|
13.02 Entire Agreement; Supersedure.
|
24
|
13.03 Effect of Waiver or Consent.
|
24
|
13.04 Amendment or Restatement.
|
24
|
13.05 Binding Effect.
|
24
|
13.06 Governing Law; Severability.
|
25
|
13.07 [Reserved]
|
25
|
13.08 Further Assurances.
|
25
|
13.09 [Reserved]
|
25
|
13.10 Offset.
|
25
|
13.11 Counterparts.
|
25
|
A.
|
DDLLC formed the Company on April 19, 2005 as the sole member.
|
B.
|
The Limited Liability Company Agreement of Enterprise Products Holdings LLC (formerly EPE Holdings, LLC) was
executed effective April 19, 2005, was amended and restated pursuant to an Amended and Restated Limited Liability Company Agreement dated August 29, 2005, was amended and restated pursuant to a Second Amended and Restated Limited Liability
Company Agreement dated as of February 13, 2006, was amended and restated pursuant to a Third Amended and Restated Limited Liability Company Agreement dated as of November 7, 2007, was amended and restated pursuant to a Fourth Amended and
Restated Limited Liability Company Agreement dated as of November 22, 2010, and was amended and restated pursuant to a Fifth Amended and Restated Limited Liability Company Agreement dated as of September 7, 2011 (as so amended and as further
amended on the date hereof, the “Existing Agreement”).
|
C.
|
DDLLC, the sole Member of the Company, deems it advisable to amend and restate the limited liability company
agreement of the Company in its entirety as set forth herein.
|
MEMBER:
DAN DUNCAN LLC
|
||
By:
|
/s/ Richard H. Bachmann
|
|
Name: Richard H. Bachmann
|
||
Title: President and Chief Executive Officer
|
||
PARTNERSHIP REPRESENTATIVE
(for purposes of Section 7.02):
VOTING TRUSTEES UNDER THAT
CERTAIN DAN DUNCAN LLC VOTING
TRUST AGREEMENT DATED AS OF
APRIL 26, 2006
|
||
/s/ Randa Duncan Williams
|
||
Randa Duncan Williams, Successor Voting Trustee
|
||
/s/ Richard H. Bachmann
|
||
Richard H. Bachmann, Successor Voting Trustee
|
||
/s/ W. Randall Fowler
|
||
W. Randall Fowler, Successor Voting Trustee
|
• |
strategic direction for the MLP, including business opportunities via organic growth as well as acquisitions;
|
• |
vision, leadership and development of a management team charged with executive development, resource deployment, asset operations and commercial development;
|
• |
progress against business goals and redirection of efforts as necessary;
|
• |
operational performance and monitoring the progress of key projects;
|
• |
responsible and ethical management;
|
• |
strategies to preserve a strong MLP balance sheet;
|
• |
information to assist the Board and any committee thereof in identifying continuing education opportunities so directors can enhance their skills and understanding of the MLP’s
business;
|
• |
information to assist the Board and any committee thereof with determining the size and composition of the Board and the recruiting of new members as needed; and
|
•
|
oversight of:
|
• |
the MLP’s legal and human resources departments;
|
• |
policies that reflect the MLP’s values and business goals, and
|
• |
policies to enhance the effectiveness of the MLP’s governance structure.
|
Amounts
Outstanding at
|
||||
Guaranteed Securities
|
June 30, 2022
|
|||
Commercial Paper Notes
|
$
|
640
|
||
Senior Notes HH, 3.35% fixed-rate, due March 2023
|
1,250
|
|||
Senior Notes JJ, 3.90% fixed-rate, due February 2024
|
850
|
|||
Senior Notes MM, 3.75% fixed-rate, due February 2025
|
1,150
|
|||
Senior Notes PP, 3.70% fixed-rate, due February 2026
|
875
|
|||
Senior Notes SS, 3.95% fixed-rate, due February 2027
|
575
|
|||
Senior Notes WW, 4.15% fixed-rate, due October 2028
|
1,000
|
|||
Senior Notes YY, 3.125% fixed-rate, due July 2029
|
1,250
|
|||
Senior Notes AAA, 2.80% fixed-rate, due January 2030
|
1,250
|
|||
Senior Notes D, 6.875% fixed-rate, due March 2033
|
500
|
|||
Senior Notes H, 6.65% fixed-rate, due October 2034
|
350
|
|||
Senior Notes J, 5.75% fixed-rate, due March 2035
|
250
|
|||
Senior Notes W, 7.55% fixed-rate, due April 2038
|
400
|
|||
Senior Notes R, 6.125% fixed-rate, due October 2039
|
600
|
|||
Senior Notes Z, 6.45% fixed-rate, due September 2040
|
600
|
|||
Senior Notes BB, 5.95% fixed-rate, due February 2041
|
750
|
|||
Senior Notes DD, 5.70% fixed-rate, due February 2042
|
600
|
|||
Senior Notes EE, 4.85% fixed-rate, due August 2042
|
750
|
|||
Senior Notes GG, 4.45% fixed-rate, due February 2043
|
1,100
|
|||
Senior Notes II, 4.85% fixed-rate, due March 2044
|
1,400
|
|||
Senior Notes KK, 5.10% fixed-rate, due February 2045
|
1,150
|
|||
Senior Notes QQ, 4.90% fixed-rate, due May 2046
|
975
|
|||
Senior Notes UU, 4.25% fixed-rate, due February 2048
|
1,250
|
|||
Senior Notes XX, 4.80% fixed-rate, due February 2049
|
1,250
|
|||
Senior Notes ZZ, 4.20% fixed-rate, due January 2050
|
1,250
|
|||
Senior Notes BBB, 3.70% fixed-rate, due January 2051
|
1,000
|
|||
Senior Notes DDD, 3.20% fixed-rate, due February 2052
|
1,000
|
|||
Senior Notes EEE, 3.30% fixed-rate, due February 2053
|
1,000
|
|||
Senior Notes NN, 4.95% fixed-rate, due October 2054
|
400
|
|||
Senior Notes CCC, 3.95% fixed rate, due January 2060
|
1,000
|
|||
Junior Subordinated Notes C, variable-rate, due June 2067
|
232
|
|||
Junior Subordinated Notes D, fixed/variable-rate, due August 2077
|
700
|
|||
Junior Subordinated Notes E, fixed/variable-rate, due August 2077
|
1,000
|
|||
Junior Subordinated Notes F, fixed/variable-rate, due February 2078
|
700
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Enterprise Products Partners L.P;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the
statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the
financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure
that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our
supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent
fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to
the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably
likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over
financial reporting.
|
/s/ A. James Teague
|
||
Name:
|
A. James Teague
|
|
Title:
|
Co-Chief Executive Officer of Enterprise Products Holdings LLC, the General Partner of Enterprise Products Partners L.P.
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Enterprise Products Partners L.P.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the
statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the
financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure
that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our
supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent
fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to
the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably
likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over
financial reporting.
|
/s/ W. Randall Fowler
|
||
Name:
|
W. Randall Fowler
|
|
Title:
|
Co-Chief Executive Officer and Chief Financial Officer of Enterprise Products Holdings LLC, the General Partner of Enterprise Products Partners L.P.
|
(1)
|
The Report fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results
of operations of the Registrant.
|
/s/ A. James Teague
|
||
Name:
|
A. James Teague
|
|
Title:
|
Co-Chief Executive Officer of Enterprise Products Holdings LLC, the General Partner of Enterprise Products Partners L.P.
|
(1)
|
The Report fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results
of operations of the Registrant.
|
/s/ W. Randall Fowler
|
||
Name:
|
W. Randall Fowler
|
|
Title:
|
Co-Chief Executive Officer and Chief Financial Officer of Enterprise Products Holdings LLC, the General Partner of Enterprise Products Partners L.P.
|