☒
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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☐
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the transition period from _______ to _______
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Delaware
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74-2956831
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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Title of each class
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Trading Symbol(s)
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Name of each exchange on which registered
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Common units
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NS
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New York Stock Exchange
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Series A Fixed-to-Floating Rate Cumulative Redeemable Perpetual Preferred Units
|
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NSprA
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New York Stock Exchange
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Series B Fixed-to-Floating Rate Cumulative Redeemable Perpetual Preferred Units
|
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NSprB
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New York Stock Exchange
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Series C Fixed-to-Floating Rate Cumulative Redeemable Perpetual Preferred Units
|
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NSprC
|
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New York Stock Exchange
|
Large accelerated filer
|
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x
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Accelerated filer
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☐
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Non-accelerated filer
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☐
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Smaller reporting company
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☐
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Emerging growth company
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☐
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Item 1.
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Item 2.
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Item 3.
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Item 4.
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Item 6.
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Item 1.
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Financial Statements
|
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June 30,
2019 |
|
December 31,
2018 |
||||
Assets
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
15,299
|
|
|
$
|
11,529
|
|
Accounts receivable, net of allowance for doubtful accounts of $9,452
and $9,412 as of June 30, 2019 and December 31, 2018, respectively
|
117,688
|
|
|
110,417
|
|
||
Inventories
|
9,454
|
|
|
8,434
|
|
||
Prepaid and other current assets
|
29,591
|
|
|
17,374
|
|
||
Assets held for sale
|
301,529
|
|
|
599,347
|
|
||
Total current assets
|
473,561
|
|
|
747,101
|
|
||
Property, plant and equipment, at cost
|
5,981,860
|
|
|
5,627,805
|
|
||
Accumulated depreciation and amortization
|
(1,961,046
|
)
|
|
(1,853,003
|
)
|
||
Property, plant and equipment, net
|
4,020,814
|
|
|
3,774,802
|
|
||
Intangible assets, net
|
707,344
|
|
|
733,056
|
|
||
Goodwill
|
1,005,853
|
|
|
1,005,853
|
|
||
Other long-term assets, net
|
172,119
|
|
|
88,328
|
|
||
Total assets
|
$
|
6,379,691
|
|
|
$
|
6,349,140
|
|
Liabilities, Mezzanine Equity and Partners’ Equity
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
128,547
|
|
|
$
|
103,122
|
|
Short-term debt and current portion of finance leases
|
10,087
|
|
|
18,500
|
|
||
Accrued interest payable
|
38,929
|
|
|
36,293
|
|
||
Accrued liabilities
|
69,970
|
|
|
74,418
|
|
||
Taxes other than income tax
|
14,060
|
|
|
16,823
|
|
||
Income tax payable
|
1,920
|
|
|
4,445
|
|
||
Liabilities held for sale
|
68,616
|
|
|
69,834
|
|
||
Total current liabilities
|
332,129
|
|
|
323,435
|
|
||
Long-term debt
|
3,456,461
|
|
|
3,111,996
|
|
||
Deferred income tax liability
|
12,250
|
|
|
12,428
|
|
||
Other long-term liabilities
|
176,951
|
|
|
79,558
|
|
||
Total liabilities
|
3,977,791
|
|
|
3,527,417
|
|
||
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|
|
|
||||
Commitments and contingencies (Note 6)
|
|
|
|
||||
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|
|
|
||||
Series D preferred limited partners (23,246,650 preferred units outstanding as of
June 30, 2019 and December 31, 2018) (Note 9)
|
572,597
|
|
|
563,992
|
|
||
|
|
|
|
||||
Partners’ equity (Note 10):
|
|
|
|
||||
Preferred limited partners
|
|
|
|
||||
Series A (9,060,000 units outstanding as of June 30, 2019 and December 31, 2018)
|
218,307
|
|
|
218,307
|
|
||
Series B (15,400,000 units outstanding as of June 30, 2019 and December 31, 2018)
|
371,476
|
|
|
371,476
|
|
||
Series C (6,900,000 units outstanding as of June 30, 2019 and December 31, 2018)
|
166,518
|
|
|
166,518
|
|
||
Common limited partners (107,763,033 and 107,225,156 common units outstanding
as of June 30, 2019 and December 31, 2018, respectively)
|
1,140,665
|
|
|
1,556,308
|
|
||
Accumulated other comprehensive loss
|
(67,663
|
)
|
|
(54,878
|
)
|
||
Total partners’ equity
|
1,829,303
|
|
|
2,257,731
|
|
||
Total liabilities, mezzanine equity and partners’ equity
|
$
|
6,379,691
|
|
|
$
|
6,349,140
|
|
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Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
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2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Revenues:
|
|
|
|
|
|
|
|
||||||||
Service revenues
|
$
|
282,472
|
|
|
$
|
259,599
|
|
|
$
|
541,499
|
|
|
$
|
507,668
|
|
Product sales
|
89,973
|
|
|
129,657
|
|
|
178,772
|
|
|
258,315
|
|
||||
Total revenues
|
372,445
|
|
|
389,256
|
|
|
720,271
|
|
|
765,983
|
|
||||
Costs and expenses:
|
|
|
|
|
|
|
|
||||||||
Costs associated with service revenues:
|
|
|
|
|
|
|
|
||||||||
Operating expenses (excluding depreciation and amortization expense)
|
101,095
|
|
|
102,241
|
|
|
196,506
|
|
|
190,320
|
|
||||
Depreciation and amortization expense
|
64,991
|
|
|
61,777
|
|
|
129,809
|
|
|
121,601
|
|
||||
Total costs associated with service revenues
|
166,086
|
|
|
164,018
|
|
|
326,315
|
|
|
311,921
|
|
||||
Cost of product sales
|
86,389
|
|
|
119,939
|
|
|
172,571
|
|
|
245,089
|
|
||||
General and administrative expenses (excluding depreciation and amortization expense)
|
24,868
|
|
|
26,754
|
|
|
50,559
|
|
|
44,896
|
|
||||
Other depreciation and amortization expense
|
1,819
|
|
|
2,158
|
|
|
3,938
|
|
|
4,197
|
|
||||
Total costs and expenses
|
279,162
|
|
|
312,869
|
|
|
553,383
|
|
|
606,103
|
|
||||
Operating income
|
93,283
|
|
|
76,387
|
|
|
166,888
|
|
|
159,880
|
|
||||
Interest expense, net
|
(45,693
|
)
|
|
(48,389
|
)
|
|
(89,984
|
)
|
|
(95,777
|
)
|
||||
Other income, net
|
621
|
|
|
1,607
|
|
|
1,412
|
|
|
2,623
|
|
||||
Income from continuing operations before income
tax expense
|
48,211
|
|
|
29,605
|
|
|
78,316
|
|
|
66,726
|
|
||||
Income tax expense
|
1,296
|
|
|
2,696
|
|
|
2,478
|
|
|
6,584
|
|
||||
Income from continuing operations, net of tax
|
46,915
|
|
|
26,909
|
|
|
75,838
|
|
|
60,142
|
|
||||
(Loss) income from discontinued operations, net of tax
|
(964
|
)
|
|
2,490
|
|
|
(307,750
|
)
|
|
95,390
|
|
||||
Net income (loss)
|
$
|
45,951
|
|
|
$
|
29,399
|
|
|
$
|
(231,912
|
)
|
|
$
|
155,532
|
|
|
|
|
|
|
|
|
|
||||||||
Basic net income (loss) per common unit (Note 11):
|
|
|
|
|
|
|
|
||||||||
Continuing operations
|
$
|
0.11
|
|
|
$
|
0.12
|
|
|
$
|
0.05
|
|
|
$
|
0.30
|
|
Discontinued operations
|
(0.01
|
)
|
|
0.03
|
|
|
(2.86
|
)
|
|
1.00
|
|
||||
Total net income (loss) per common unit
|
$
|
0.10
|
|
|
$
|
0.15
|
|
|
$
|
(2.81
|
)
|
|
$
|
1.30
|
|
|
|
|
|
|
|
|
|
||||||||
Basic weighted-average common units outstanding
|
107,763,016
|
|
|
93,192,238
|
|
|
107,647,957
|
|
|
93,187,038
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Comprehensive income (loss)
|
$
|
37,992
|
|
|
$
|
26,778
|
|
|
$
|
(244,697
|
)
|
|
$
|
173,835
|
|
|
Six Months Ended June 30,
|
||||||
|
2019
|
|
2018
|
||||
Cash Flows from Operating Activities:
|
|
|
|
||||
Net (loss) income
|
$
|
(231,912
|
)
|
|
$
|
155,532
|
|
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
|
|
|
|
||||
Depreciation and amortization expense
|
142,283
|
|
|
147,879
|
|
||
Unit-based compensation expense
|
5,774
|
|
|
4,277
|
|
||
Amortization of debt related items
|
2,643
|
|
|
3,965
|
|
||
Gain from sale or disposition of assets
|
(1,300
|
)
|
|
(1,218
|
)
|
||
Asset impairment losses
|
305,715
|
|
|
—
|
|
||
Goodwill impairment loss
|
31,123
|
|
|
—
|
|
||
Gain from insurance recoveries
|
—
|
|
|
(78,756
|
)
|
||
Deferred income tax (benefit) expense
|
(575
|
)
|
|
1,142
|
|
||
Changes in current assets and current liabilities (Note 12)
|
(36,229
|
)
|
|
42,733
|
|
||
Decrease (increase) in other long-term assets
|
15,190
|
|
|
(11,224
|
)
|
||
Increase (decrease) in other long-term liabilities
|
9,157
|
|
|
(20,073
|
)
|
||
Other, net
|
(975
|
)
|
|
(407
|
)
|
||
Net cash provided by operating activities
|
240,894
|
|
|
243,850
|
|
||
Cash Flows from Investing Activities:
|
|
|
|
||||
Capital expenditures
|
(319,961
|
)
|
|
(248,521
|
)
|
||
Change in accounts payable related to capital expenditures
|
16,144
|
|
|
(19,320
|
)
|
||
Proceeds from sale or disposition of assets
|
143
|
|
|
2,097
|
|
||
Proceeds from insurance recoveries
|
—
|
|
|
78,419
|
|
||
Acquisitions
|
—
|
|
|
(37,502
|
)
|
||
Net cash used in investing activities
|
(303,674
|
)
|
|
(224,827
|
)
|
||
Cash Flows from Financing Activities:
|
|
|
|
||||
Proceeds from long-term debt borrowings
|
415,800
|
|
|
677,272
|
|
||
Proceeds from short-term debt borrowings
|
178,500
|
|
|
456,000
|
|
||
Proceeds from note offering, net of issuance costs
|
491,665
|
|
|
—
|
|
||
Long-term debt repayments
|
(616,800
|
)
|
|
(905,521
|
)
|
||
Short-term debt repayments
|
(191,000
|
)
|
|
(428,000
|
)
|
||
Proceeds from issuance of Series D preferred units
|
—
|
|
|
400,000
|
|
||
Payment of issuance costs for Series D preferred units
|
—
|
|
|
(29,289
|
)
|
||
Proceeds from issuance of common units
|
—
|
|
|
10,000
|
|
||
Distributions to preferred unitholders
|
(60,846
|
)
|
|
(32,713
|
)
|
||
Distributions to common unitholders and general partner
|
(129,025
|
)
|
|
(172,324
|
)
|
||
Proceeds from termination of interest rate swaps
|
—
|
|
|
8,048
|
|
||
Payment of tax withholding for unit-based compensation
|
(6,368
|
)
|
|
(69
|
)
|
||
Decrease in cash book overdrafts
|
(4,718
|
)
|
|
(436
|
)
|
||
Other, net
|
(3,451
|
)
|
|
(5,518
|
)
|
||
Net cash provided by (used in) financing activities
|
73,757
|
|
|
(22,550
|
)
|
||
Effect of foreign exchange rate changes on cash
|
261
|
|
|
(421
|
)
|
||
Net increase (decrease) in cash, cash equivalents and restricted cash
|
11,238
|
|
|
(3,948
|
)
|
||
Cash, cash equivalents and restricted cash as of the beginning of the period
|
13,644
|
|
|
24,292
|
|
||
Cash, cash equivalents and restricted cash as of the end of the period
|
$
|
24,882
|
|
|
$
|
20,344
|
|
|
Limited Partners
|
|
|
|
|
|
|
|
Mezzanine Equity
|
|
|
||||||||||||||||
|
Preferred
|
|
Common
|
|
General
Partner
|
|
Accumulated
Other
Comprehensive
Loss
|
|
Total Partners’ Equity
(Note 10)
|
|
Series D Preferred Limited Partners (Note 9)
|
|
Total
|
||||||||||||||
Balance as of March 31, 2019
|
$
|
756,301
|
|
|
$
|
1,192,080
|
|
|
$
|
—
|
|
|
$
|
(59,704
|
)
|
|
$
|
1,888,677
|
|
|
$
|
568,293
|
|
|
$
|
2,456,970
|
|
Net income
|
16,033
|
|
|
15,528
|
|
|
—
|
|
|
—
|
|
|
31,561
|
|
|
14,390
|
|
|
45,951
|
|
|||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(7,959
|
)
|
|
(7,959
|
)
|
|
—
|
|
|
(7,959
|
)
|
|||||||
Distributions to partners:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Series A, B and C preferred
|
(16,033
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(16,033
|
)
|
|
—
|
|
|
(16,033
|
)
|
|||||||
Common ($0.60 per unit)
|
—
|
|
|
(64,658
|
)
|
|
—
|
|
|
—
|
|
|
(64,658
|
)
|
|
—
|
|
|
(64,658
|
)
|
|||||||
Series D preferred
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(14,390
|
)
|
|
(14,390
|
)
|
|||||||
Unit-based compensation
|
—
|
|
|
2,146
|
|
|
—
|
|
|
—
|
|
|
2,146
|
|
|
—
|
|
|
2,146
|
|
|||||||
Series D preferred unit accretion
|
—
|
|
|
(4,446
|
)
|
|
—
|
|
|
—
|
|
|
(4,446
|
)
|
|
4,446
|
|
|
—
|
|
|||||||
Other
|
—
|
|
|
15
|
|
|
—
|
|
|
—
|
|
|
15
|
|
|
(142
|
)
|
|
(127
|
)
|
|||||||
Balance as of June 30, 2019
|
$
|
756,301
|
|
|
$
|
1,140,665
|
|
|
$
|
—
|
|
|
$
|
(67,663
|
)
|
|
$
|
1,829,303
|
|
|
$
|
572,597
|
|
|
$
|
2,401,900
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Balance as of March 31, 2018
|
$
|
756,494
|
|
|
$
|
1,772,874
|
|
|
$
|
26,692
|
|
|
$
|
(64,003
|
)
|
|
$
|
2,492,057
|
|
|
$
|
—
|
|
|
$
|
2,492,057
|
|
Net income
|
16,033
|
|
|
12,891
|
|
|
263
|
|
|
—
|
|
|
29,187
|
|
|
212
|
|
|
29,399
|
|
|||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,621
|
)
|
|
(2,621
|
)
|
|
—
|
|
|
(2,621
|
)
|
|||||||
Distributions to partners:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Series A, B and C preferred
|
(16,033
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(16,033
|
)
|
|
—
|
|
|
(16,033
|
)
|
|||||||
Common ($0.60 per unit)
and general partner
|
—
|
|
|
(55,911
|
)
|
|
(1,141
|
)
|
|
—
|
|
|
(57,052
|
)
|
|
—
|
|
|
(57,052
|
)
|
|||||||
Series D preferred
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(212
|
)
|
|
(212
|
)
|
|||||||
Issuance of common units, including contribution from general partner
|
—
|
|
|
10,000
|
|
|
204
|
|
|
—
|
|
|
10,204
|
|
|
—
|
|
|
10,204
|
|
|||||||
Issuance of Series D preferred units
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
370,711
|
|
|
370,711
|
|
|||||||
Unit-based compensation
|
—
|
|
|
1,765
|
|
|
—
|
|
|
—
|
|
|
1,765
|
|
|
—
|
|
|
1,765
|
|
|||||||
Other
|
(160
|
)
|
|
(851
|
)
|
|
(19
|
)
|
|
—
|
|
|
(1,030
|
)
|
|
—
|
|
|
(1,030
|
)
|
|||||||
Balance as of June 30, 2018
|
$
|
756,334
|
|
|
$
|
1,740,768
|
|
|
$
|
25,999
|
|
|
$
|
(66,624
|
)
|
|
$
|
2,456,477
|
|
|
$
|
370,711
|
|
|
$
|
2,827,188
|
|
|
Limited Partners
|
|
|
|
|
|
|
|
Mezzanine Equity
|
|
|
||||||||||||||||
|
Preferred
|
|
Common
|
|
General
Partner
|
|
Accumulated
Other
Comprehensive
Loss
|
|
Total Partners’ Equity
(Note 10)
|
|
Series D Preferred Limited Partners (Note 9)
|
|
Total
|
||||||||||||||
Balance as of January 1, 2019
|
$
|
756,301
|
|
|
$
|
1,556,308
|
|
|
$
|
—
|
|
|
$
|
(54,878
|
)
|
|
$
|
2,257,731
|
|
|
$
|
563,992
|
|
|
$
|
2,821,723
|
|
Net income (loss)
|
32,066
|
|
|
(292,758
|
)
|
|
—
|
|
|
—
|
|
|
(260,692
|
)
|
|
28,780
|
|
|
(231,912
|
)
|
|||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(12,785
|
)
|
|
(12,785
|
)
|
|
—
|
|
|
(12,785
|
)
|
|||||||
Distributions to partners:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Series A, B and C preferred
|
(32,066
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(32,066
|
)
|
|
—
|
|
|
(32,066
|
)
|
|||||||
Common ($1.20 per unit)
|
—
|
|
|
(129,025
|
)
|
|
—
|
|
|
—
|
|
|
(129,025
|
)
|
|
—
|
|
|
(129,025
|
)
|
|||||||
Series D preferred
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(28,780
|
)
|
|
(28,780
|
)
|
|||||||
Unit-based compensation
|
—
|
|
|
15,686
|
|
|
—
|
|
|
—
|
|
|
15,686
|
|
|
—
|
|
|
15,686
|
|
|||||||
Series D preferred unit accretion
|
—
|
|
|
(8,748
|
)
|
|
—
|
|
|
—
|
|
|
(8,748
|
)
|
|
8,748
|
|
|
—
|
|
|||||||
Other
|
—
|
|
|
(798
|
)
|
|
—
|
|
|
—
|
|
|
(798
|
)
|
|
(143
|
)
|
|
(941
|
)
|
|||||||
Balance as of June 30, 2019
|
$
|
756,301
|
|
|
$
|
1,140,665
|
|
|
$
|
—
|
|
|
$
|
(67,663
|
)
|
|
$
|
1,829,303
|
|
|
$
|
572,597
|
|
|
$
|
2,401,900
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Balance as of January 1, 2018
|
$
|
756,603
|
|
|
$
|
1,770,587
|
|
|
$
|
37,826
|
|
|
$
|
(84,927
|
)
|
|
$
|
2,480,089
|
|
|
$
|
—
|
|
|
$
|
2,480,089
|
|
Net income
|
32,023
|
|
|
120,831
|
|
|
2,466
|
|
|
—
|
|
|
155,320
|
|
|
212
|
|
|
155,532
|
|
|||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
18,303
|
|
|
18,303
|
|
|
—
|
|
|
18,303
|
|
|||||||
Distributions to partners:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Series A, B and C preferred
|
(32,023
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(32,023
|
)
|
|
—
|
|
|
(32,023
|
)
|
|||||||
Common ($1.695 per unit)
and general partner
|
—
|
|
|
(157,945
|
)
|
|
(14,379
|
)
|
|
—
|
|
|
(172,324
|
)
|
|
—
|
|
|
(172,324
|
)
|
|||||||
Series D preferred
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(212
|
)
|
|
(212
|
)
|
|||||||
Issuance of common units, including contribution from general partner
|
—
|
|
|
10,000
|
|
|
204
|
|
|
—
|
|
|
10,204
|
|
|
—
|
|
|
10,204
|
|
|||||||
Issuance of Series D preferred units
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
370,711
|
|
|
370,711
|
|
|||||||
Unit-based compensation
|
—
|
|
|
3,051
|
|
|
—
|
|
|
—
|
|
|
3,051
|
|
|
—
|
|
|
3,051
|
|
|||||||
Other
|
(269
|
)
|
|
(5,756
|
)
|
|
(118
|
)
|
|
—
|
|
|
(6,143
|
)
|
|
—
|
|
|
(6,143
|
)
|
|||||||
Balance as of June 30, 2018
|
$
|
756,334
|
|
|
$
|
1,740,768
|
|
|
$
|
25,999
|
|
|
$
|
(66,624
|
)
|
|
$
|
2,456,477
|
|
|
$
|
370,711
|
|
|
$
|
2,827,188
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(Thousands of Dollars)
|
||||||||||||||
Revenues
|
$
|
92,837
|
|
|
$
|
96,948
|
|
|
$
|
231,480
|
|
|
$
|
196,102
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
||||||||
Cost of revenues
|
86,278
|
|
|
92,177
|
|
|
202,880
|
|
|
174,633
|
|
||||
Impairment losses
|
8,398
|
|
|
—
|
|
|
336,838
|
|
|
—
|
|
||||
General and administrative expenses (excluding depreciation and amortization expense)
|
305
|
|
|
1,227
|
|
|
610
|
|
|
2,859
|
|
||||
Other depreciation and amortization expense
|
—
|
|
|
93
|
|
|
—
|
|
|
172
|
|
||||
Total costs and expenses
|
94,981
|
|
|
93,497
|
|
|
540,328
|
|
|
177,664
|
|
||||
Operating (loss) income
|
(2,144
|
)
|
|
3,451
|
|
|
(308,848
|
)
|
|
18,438
|
|
||||
Interest income (expense), net
|
9
|
|
|
(547
|
)
|
|
32
|
|
|
(931
|
)
|
||||
Other income (expense), net
|
1,171
|
|
|
(195
|
)
|
|
1,167
|
|
|
78,541
|
|
||||
(Loss) income from discontinued operations before income
tax expense
|
(964
|
)
|
|
2,709
|
|
|
(307,649
|
)
|
|
96,048
|
|
||||
Income tax expense
|
—
|
|
|
219
|
|
|
101
|
|
|
658
|
|
||||
(Loss) income from discontinued operations, net of tax
|
$
|
(964
|
)
|
|
$
|
2,490
|
|
|
$
|
(307,750
|
)
|
|
$
|
95,390
|
|
|
Six Months Ended June 30,
|
||||||
|
2019
|
|
2018
|
||||
|
(Thousands of Dollars)
|
||||||
Capital expenditures
|
$
|
(23,635
|
)
|
|
$
|
(82,111
|
)
|
|
|
|
|
||||
Significant noncash operating activities:
|
|
|
|
||||
Depreciation and amortization expense
|
$
|
8,536
|
|
|
$
|
22,081
|
|
Asset impairment losses
|
$
|
305,715
|
|
|
$
|
—
|
|
Goodwill impairment loss
|
$
|
31,123
|
|
|
$
|
—
|
|
Gain from insurance recoveries
|
$
|
—
|
|
|
$
|
(78,756
|
)
|
|
June 30,
2019 |
|
December 31,
2018 |
||||
|
(Thousands of Dollars)
|
||||||
Total current assets
|
$
|
46,826
|
|
|
$
|
54,404
|
|
Property, plant and equipment, net
|
223,723
|
|
|
513,820
|
|
||
Goodwill
|
—
|
|
|
31,123
|
|
||
Other long-term assets, net
|
30,980
|
|
|
—
|
|
||
Assets held for sale
|
$
|
301,529
|
|
|
$
|
599,347
|
|
|
|
|
|
||||
Total current liabilities
|
$
|
44,625
|
|
|
$
|
69,834
|
|
Total long-term liabilities
|
23,991
|
|
|
—
|
|
||
Liabilities held for sale
|
$
|
68,616
|
|
|
$
|
69,834
|
|
|
2019
|
|
2018
|
||||||||||||
|
Contract Assets
|
|
Contract Liabilities
|
|
Contract Assets
|
|
Contract Liabilities
|
||||||||
|
(Thousands of Dollars)
|
||||||||||||||
Balances as of January 1:
|
|
|
|
|
|
|
|
||||||||
Current portion
|
$
|
2,066
|
|
|
$
|
(21,579
|
)
|
|
$
|
1,956
|
|
|
$
|
(13,801
|
)
|
Noncurrent portion
|
539
|
|
|
(38,945
|
)
|
|
171
|
|
|
(46,361
|
)
|
||||
Held for sale
|
—
|
|
|
(25,357
|
)
|
|
—
|
|
|
(302
|
)
|
||||
Total
|
2,605
|
|
|
(85,881
|
)
|
|
2,127
|
|
|
(60,464
|
)
|
||||
|
|
|
|
|
|
|
|
||||||||
Activity:
|
|
|
|
|
|
|
|
||||||||
Additions
|
2,674
|
|
|
(24,537
|
)
|
|
879
|
|
|
(20,820
|
)
|
||||
Transfer to accounts receivable
|
(2,638
|
)
|
|
—
|
|
|
(2,397
|
)
|
|
—
|
|
||||
Transfer to revenues, including amounts
reported in discontinued operations
|
—
|
|
|
46,757
|
|
|
—
|
|
|
28,466
|
|
||||
Total
|
36
|
|
|
22,220
|
|
|
(1,518
|
)
|
|
7,646
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Balances as of June 30:
|
|
|
|
|
|
|
|
||||||||
Current portion
|
1,483
|
|
|
(23,688
|
)
|
|
327
|
|
|
(17,881
|
)
|
||||
Noncurrent portion
|
1,158
|
|
|
(39,973
|
)
|
|
282
|
|
|
(34,669
|
)
|
||||
Held for sale
|
—
|
|
|
—
|
|
|
—
|
|
|
(268
|
)
|
||||
Total
|
$
|
2,641
|
|
|
$
|
(63,661
|
)
|
|
$
|
609
|
|
|
$
|
(52,818
|
)
|
2019 (remaining)
|
|
$
|
252,055
|
|
2020
|
|
422,044
|
|
|
2021
|
|
290,290
|
|
|
2022
|
|
241,784
|
|
|
2023
|
|
172,720
|
|
|
Thereafter
|
|
332,782
|
|
|
Total
|
|
$
|
1,711,675
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(Thousands of Dollars)
|
||||||||||||||
Pipeline segment:
|
|
|
|
|
|
|
|
||||||||
Crude oil pipelines
|
$
|
77,293
|
|
|
$
|
60,507
|
|
|
$
|
145,771
|
|
|
$
|
113,944
|
|
Refined products and ammonia pipelines
|
92,534
|
|
|
89,769
|
|
|
177,640
|
|
|
173,068
|
|
||||
Total pipeline segment revenues from contracts with customers
|
169,827
|
|
|
150,276
|
|
|
323,411
|
|
|
287,012
|
|
||||
Lessor revenues
|
2,666
|
|
|
—
|
|
|
5,333
|
|
|
54
|
|
||||
Total pipeline segment revenues
|
172,493
|
|
|
150,276
|
|
|
328,744
|
|
|
287,066
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Storage segment:
|
|
|
|
|
|
|
|
||||||||
Throughput terminals
|
23,170
|
|
|
20,140
|
|
|
44,856
|
|
|
40,157
|
|
||||
Storage terminals
|
77,039
|
|
|
84,718
|
|
|
148,660
|
|
|
166,159
|
|
||||
Total storage segment revenues from contracts with customers
|
100,209
|
|
|
104,858
|
|
|
193,516
|
|
|
206,316
|
|
||||
Lessor revenues
|
10,194
|
|
|
9,962
|
|
|
20,387
|
|
|
19,924
|
|
||||
Total storage segment revenues
|
110,403
|
|
|
114,820
|
|
|
213,903
|
|
|
226,240
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Fuels marketing segment:
|
|
|
|
|
|
|
|
||||||||
Revenues from contracts with customers
|
89,549
|
|
|
124,293
|
|
|
177,628
|
|
|
252,951
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Consolidation and intersegment eliminations
|
—
|
|
|
(133
|
)
|
|
(4
|
)
|
|
(274
|
)
|
||||
|
|
|
|
|
|
|
|
||||||||
Total revenues
|
$
|
372,445
|
|
|
$
|
389,256
|
|
|
$
|
720,271
|
|
|
$
|
765,983
|
|
•
|
the package of practical expedients, which, among other things, allowed us to carry forward historical lease classification;
|
•
|
the practical expedient specifically related to land easements, which, among other things, allowed us to carry forward our historical accounting treatment for existing land easement agreements;
|
•
|
the lessee practical expedient to combine lease and non-lease components for all of our asset classes except the other pipeline and terminal equipment asset class; and
|
•
|
the lessor practical expedient to combine lease and non-lease components and to account for the transaction based on the predominant component (i.e., ASC Topic 842 or ASC Topic 606, “Revenue from Contracts with Customers”). We apply this expedient to certain contracts in which we agree to provide both storage capacity and optional services to customers.
|
•
|
dockage and wharfage charges, which are based on volumes moved over leased docks and are included in our calculation of our lease payments based on minimum throughput volume requirements. We recognize charges on excess throughput volumes in profit or loss in the period in which the obligation for those payments is incurred; and
|
•
|
consumer price index adjustments, which are measured and included in the calculation of our lease payments based on the consumer price index at the adoption date or, after adoption, at the commencement date. We recognize changes in lease payments as a result of changes in the consumer price index in profit or loss in the period in which those payments are made.
|
|
|
Balance Sheet Location
|
|
June 30, 2019
|
||
|
|
|
|
(Thousands of Dollars)
|
||
Right-of-Use Assets:
|
|
|
|
|
||
Operating
|
|
Other long-term assets, net
|
|
$
|
86,414
|
|
Operating
|
|
Assets held for sale
|
|
$
|
30,980
|
|
Finance
|
|
Property, plant and equipment, net of accumulated
amortization of $1,741
|
|
$
|
73,982
|
|
|
|
|
|
|
||
Lease Liabilities:
|
|
|
|
|
||
Operating:
|
|
|
|
|
||
Current
|
|
Accrued liabilities
|
|
$
|
11,832
|
|
Current
|
|
Liabilities held for sale
|
|
31,681
|
|
|
Noncurrent
|
|
Other long-term liabilities
|
|
73,723
|
|
|
Total operating lease liabilities
|
|
|
|
$
|
117,236
|
|
Finance:
|
|
|
|
|
||
Current
|
|
Short-term debt and current portion of finance leases
|
|
$
|
4,087
|
|
Noncurrent
|
|
Long-term debt
|
|
55,241
|
|
|
Total finance lease liabilities
|
|
|
|
$
|
59,328
|
|
|
|
Operating Leases
|
|
Finance Leases
|
||||
|
|
(Thousands of Dollars)
|
||||||
2019 (remaining)
|
|
$
|
13,042
|
|
|
$
|
3,022
|
|
2020
|
|
17,053
|
|
|
6,044
|
|
||
2021
|
|
13,180
|
|
|
4,594
|
|
||
2022
|
|
12,622
|
|
|
3,939
|
|
||
2023
|
|
11,654
|
|
|
3,896
|
|
||
Thereafter
|
|
79,789
|
|
|
63,281
|
|
||
Total lease payments
|
|
$
|
147,340
|
|
|
$
|
84,776
|
|
Less: Interest
|
|
30,104
|
|
|
25,448
|
|
||
Present value of lease liabilities
|
|
$
|
117,236
|
|
|
$
|
59,328
|
|
|
|
Three Months Ended June 30, 2019
|
|
Six Months Ended June 30, 2019
|
||||
|
|
(Thousands of Dollars)
|
||||||
Operating lease cost
|
|
$
|
9,477
|
|
|
$
|
18,941
|
|
Finance lease cost:
|
|
|
|
|
||||
Amortization of right-of-use assets
|
|
900
|
|
|
1,741
|
|
||
Interest expense on lease liability
|
|
550
|
|
|
1,099
|
|
||
Short-term lease cost
|
|
5,609
|
|
|
9,923
|
|
||
Variable lease cost
|
|
977
|
|
|
1,788
|
|
||
Total lease cost
|
|
$
|
17,513
|
|
|
$
|
33,492
|
|
|
|
Operating Leases
|
|
Finance Leases
|
||||
|
|
(Thousands of Dollars, Except Term and Rate Data)
|
||||||
For the six months ended June 30, 2019:
|
|
|
|
|
||||
Cash outflows from operating activities
|
|
$
|
18,710
|
|
|
$
|
916
|
|
Cash outflows from financing activities
|
|
|
|
$
|
1,569
|
|
||
Right-of-use assets obtained in exchange for lease liabilities
|
|
$
|
1,352
|
|
|
$
|
1,452
|
|
As of June 30, 2019:
|
|
|
|
|
||||
Weighted-average remaining lease term (in years)
|
|
13
|
|
|
22
|
|
||
Weighted-average discount rate
|
|
3.6
|
%
|
|
3.7
|
%
|
|
|
Asset Derivatives
|
|
Liability Derivatives
|
||||||||||||
Balance Sheet Location
|
|
June 30,
2019 |
|
December 31,
2018 |
|
June 30,
2019 |
|
December 31,
2018 |
||||||||
|
|
(Thousands of Dollars)
|
||||||||||||||
Other long-term assets, net
|
|
$
|
—
|
|
|
$
|
627
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Other long-term liabilities
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(16,716
|
)
|
|
$
|
(751
|
)
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(Thousands of Dollars)
|
|
|
|
|
||||||||||
(Loss) gain recognized in other comprehensive income (loss) on derivative
|
$
|
(9,784
|
)
|
|
$
|
5,106
|
|
|
$
|
(16,592
|
)
|
|
$
|
22,527
|
|
Loss reclassified from AOCI into interest expense, net
|
$
|
(1,005
|
)
|
|
$
|
(1,162
|
)
|
|
$
|
(2,083
|
)
|
|
$
|
(2,552
|
)
|
|
June 30, 2019
|
|
December 31, 2018
|
||||
|
(Thousands of Dollars)
|
||||||
Fair value
|
$
|
3,473,806
|
|
|
$
|
3,056,704
|
|
Carrying amount
|
$
|
3,401,220
|
|
|
$
|
3,111,996
|
|
Units
|
|
Fixed Distribution Rate Per Unit Per Quarter
|
|
Fixed Distribution
Per Quarter
|
|
Date at Which Distribution
Rate Becomes Floating
|
||||
|
|
|
|
(Thousands of Dollars)
|
|
|
||||
Series A Preferred Units
|
|
$
|
0.53125
|
|
|
$
|
4,813
|
|
|
December 15, 2021
|
Series B Preferred Units
|
|
$
|
0.47657
|
|
|
$
|
7,339
|
|
|
June 15, 2022
|
Series C Preferred Units
|
|
$
|
0.56250
|
|
|
$
|
3,881
|
|
|
December 15, 2022
|
Quarter Ended
|
|
Cash
Distributions
Per Unit
|
|
Total Cash
Distributions
|
|
Record Date
|
|
Payment Date
|
||||
|
|
|
|
(Thousands of Dollars)
|
|
|
|
|
||||
June 30, 2019
|
|
$
|
0.60
|
|
|
$
|
64,658
|
|
|
August 7, 2019
|
|
August 13, 2019
|
March 31, 2019
|
|
$
|
0.60
|
|
|
$
|
64,690
|
|
|
May 8, 2019
|
|
May 14, 2019
|
|
Foreign
Currency
Translation
|
|
Cash Flow
Hedges
|
|
Pension and
Other
Postretirement
Benefits
|
|
Total
|
||||||||
|
(Thousands of Dollars)
|
||||||||||||||
Balance as of January 1, 2019
|
$
|
(47,299
|
)
|
|
$
|
(893
|
)
|
|
$
|
(6,686
|
)
|
|
$
|
(54,878
|
)
|
Other comprehensive income (loss):
|
|
|
|
|
|
|
|
||||||||
Other comprehensive income (loss) before reclassification adjustments
|
2,868
|
|
|
(16,592
|
)
|
|
—
|
|
|
(13,724
|
)
|
||||
Net gain on pension costs reclassified into other income, net
|
—
|
|
|
—
|
|
|
(1,157
|
)
|
|
(1,157
|
)
|
||||
Net loss on cash flow hedges reclassified into interest
expense, net
|
—
|
|
|
2,083
|
|
|
—
|
|
|
2,083
|
|
||||
Other
|
—
|
|
|
—
|
|
|
13
|
|
|
13
|
|
||||
Other comprehensive income (loss)
|
2,868
|
|
|
(14,509
|
)
|
|
(1,144
|
)
|
|
(12,785
|
)
|
||||
Balance as of June 30, 2019
|
$
|
(44,431
|
)
|
|
$
|
(15,402
|
)
|
|
$
|
(7,830
|
)
|
|
$
|
(67,663
|
)
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(Thousands of Dollars, Except Unit and Per Unit Data)
|
||||||||||||||
Net income (loss)
|
$
|
45,951
|
|
|
$
|
29,399
|
|
|
$
|
(231,912
|
)
|
|
$
|
155,532
|
|
Distributions to preferred limited partners
|
(30,423
|
)
|
|
(16,245
|
)
|
|
(60,846
|
)
|
|
(32,235
|
)
|
||||
Distributions to general partner
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,141
|
)
|
||||
Distributions to common limited partners
|
(64,658
|
)
|
|
(64,205
|
)
|
|
(129,348
|
)
|
|
(120,121
|
)
|
||||
Distribution equivalent rights to restricted units
|
(642
|
)
|
|
(480
|
)
|
|
(1,285
|
)
|
|
(925
|
)
|
||||
Distributions (in excess of) less than income (loss)
|
$
|
(49,772
|
)
|
|
$
|
(51,531
|
)
|
|
$
|
(423,391
|
)
|
|
$
|
1,110
|
|
|
|
|
|
|
|
|
|
||||||||
Distributions to common limited partners
|
$
|
64,658
|
|
|
$
|
64,205
|
|
|
$
|
129,348
|
|
|
$
|
120,121
|
|
Allocation of distributions (in excess of) less than income (loss)
|
(49,772
|
)
|
|
(50,500
|
)
|
|
(423,391
|
)
|
|
1,079
|
|
||||
Series D Preferred Unit accretion
|
(4,446
|
)
|
|
—
|
|
|
(8,748
|
)
|
|
—
|
|
||||
Net income (loss) attributable to common units
|
$
|
10,440
|
|
|
$
|
13,705
|
|
|
$
|
(302,791
|
)
|
|
$
|
121,200
|
|
|
|
|
|
|
|
|
|
||||||||
Basic weighted-average common units outstanding
|
107,763,016
|
|
|
93,192,238
|
|
|
107,647,957
|
|
|
93,187,038
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Basic net income (loss) per common unit
|
$
|
0.10
|
|
|
$
|
0.15
|
|
|
$
|
(2.81
|
)
|
|
$
|
1.30
|
|
|
Six Months Ended June 30,
|
||||||
|
2019
|
|
2018
|
||||
|
(Thousands of Dollars)
|
||||||
Decrease (increase) in current assets:
|
|
|
|
||||
Accounts receivable
|
$
|
(3,146
|
)
|
|
$
|
34,518
|
|
Receivable from related party
|
—
|
|
|
130
|
|
||
Inventories
|
1,551
|
|
|
(1,233
|
)
|
||
Other current assets
|
(4,075
|
)
|
|
(2,494
|
)
|
||
Increase (decrease) in current liabilities:
|
|
|
|
||||
Accounts payable
|
7,704
|
|
|
5,149
|
|
||
Accrued interest payable
|
2,636
|
|
|
(4,325
|
)
|
||
Accrued liabilities
|
(34,814
|
)
|
|
10,476
|
|
||
Taxes other than income tax
|
(3,556
|
)
|
|
1,329
|
|
||
Income tax payable
|
(2,529
|
)
|
|
(817
|
)
|
||
Changes in current assets and current liabilities
|
$
|
(36,229
|
)
|
|
$
|
42,733
|
|
•
|
the change in the amount accrued for capital expenditures;
|
•
|
the effect of foreign currency translation;
|
•
|
changes in the fair values of our interest rate swap agreements;
|
•
|
the recognition of lease liabilities upon the adoption of ASC Topic 842; and
|
•
|
the reclassification of certain assets and liabilities to “Assets held for sale” and “Liabilities held for sale” on the consolidated balance sheets (please refer to Note 3 for additional discussion).
|
|
Six Months Ended June 30,
|
||||||
|
2019
|
|
2018
|
||||
|
(Thousands of Dollars)
|
||||||
Cash paid for interest, net of amount capitalized
|
$
|
84,677
|
|
|
$
|
96,761
|
|
Cash paid for income taxes, net of tax refunds received
|
$
|
6,557
|
|
|
$
|
7,973
|
|
|
June 30,
2019 |
|
December 31,
2018 |
||||
|
(Thousands of Dollars)
|
||||||
Cash and cash equivalents
|
$
|
15,299
|
|
|
$
|
11,529
|
|
Prepaid and other current assets
|
8,744
|
|
|
—
|
|
||
Assets held for sale
|
839
|
|
|
2,115
|
|
||
Cash, cash equivalents and restricted cash
|
$
|
24,882
|
|
|
$
|
13,644
|
|
|
Pension Plans
|
|
Other Postretirement
Benefit Plans
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(Thousands of Dollars)
|
||||||||||||||
For the three months ended June 30:
|
|
|
|
|
|
|
|
||||||||
Service cost
|
$
|
2,387
|
|
|
$
|
2,405
|
|
|
$
|
108
|
|
|
$
|
126
|
|
Interest cost
|
1,370
|
|
|
1,206
|
|
|
113
|
|
|
107
|
|
||||
Expected return on assets
|
(2,003
|
)
|
|
(1,854
|
)
|
|
—
|
|
|
—
|
|
||||
Amortization of prior service credit
|
(514
|
)
|
|
(514
|
)
|
|
(286
|
)
|
|
(286
|
)
|
||||
Amortization of net loss
|
212
|
|
|
543
|
|
|
10
|
|
|
53
|
|
||||
Net periodic benefit cost (income)
|
$
|
1,452
|
|
|
$
|
1,786
|
|
|
$
|
(55
|
)
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
||||||||
For the six months ended June 30:
|
|
|
|
|
|
|
|
||||||||
Service cost
|
$
|
4,775
|
|
|
$
|
4,811
|
|
|
$
|
215
|
|
|
$
|
252
|
|
Interest cost
|
2,740
|
|
|
2,412
|
|
|
227
|
|
|
215
|
|
||||
Expected return on assets
|
(4,007
|
)
|
|
(3,709
|
)
|
|
—
|
|
|
—
|
|
||||
Amortization of prior service credit
|
(1,028
|
)
|
|
(1,028
|
)
|
|
(573
|
)
|
|
(573
|
)
|
||||
Amortization of net loss
|
423
|
|
|
1,087
|
|
|
21
|
|
|
107
|
|
||||
Net periodic benefit cost (income)
|
$
|
2,903
|
|
|
$
|
3,573
|
|
|
$
|
(110
|
)
|
|
$
|
1
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(Thousands of Dollars)
|
||||||||||||||
Revenues:
|
|
|
|
|
|
|
|
||||||||
Pipeline
|
$
|
172,493
|
|
|
$
|
150,276
|
|
|
$
|
328,744
|
|
|
$
|
287,066
|
|
Storage:
|
|
|
|
|
|
|
|
||||||||
Third parties
|
110,403
|
|
|
114,687
|
|
|
213,899
|
|
|
225,966
|
|
||||
Intersegment
|
—
|
|
|
133
|
|
|
4
|
|
|
274
|
|
||||
Total storage
|
110,403
|
|
|
114,820
|
|
|
213,903
|
|
|
226,240
|
|
||||
Fuels marketing
|
89,549
|
|
|
124,293
|
|
|
177,628
|
|
|
252,951
|
|
||||
Consolidation and intersegment eliminations
|
—
|
|
|
(133
|
)
|
|
(4
|
)
|
|
(274
|
)
|
||||
Total revenues
|
$
|
372,445
|
|
|
$
|
389,256
|
|
|
$
|
720,271
|
|
|
$
|
765,983
|
|
|
|
|
|
|
|
|
|
||||||||
Operating income:
|
|
|
|
|
|
|
|
||||||||
Pipeline
|
$
|
78,712
|
|
|
$
|
62,979
|
|
|
$
|
146,016
|
|
|
$
|
120,773
|
|
Storage
|
38,098
|
|
|
38,781
|
|
|
70,316
|
|
|
81,868
|
|
||||
Fuels marketing
|
3,160
|
|
|
3,536
|
|
|
5,085
|
|
|
6,332
|
|
||||
Consolidation and intersegment eliminations
|
—
|
|
|
3
|
|
|
(32
|
)
|
|
—
|
|
||||
Total segment operating income
|
119,970
|
|
|
105,299
|
|
|
221,385
|
|
|
208,973
|
|
||||
General and administrative expenses
|
24,868
|
|
|
26,754
|
|
|
50,559
|
|
|
44,896
|
|
||||
Other depreciation and amortization expense
|
1,819
|
|
|
2,158
|
|
|
3,938
|
|
|
4,197
|
|
||||
Total operating income
|
$
|
93,283
|
|
|
$
|
76,387
|
|
|
$
|
166,888
|
|
|
$
|
159,880
|
|
|
June 30,
2019 |
|
December 31,
2018 |
||||
|
(Thousands of Dollars)
|
||||||
Pipeline
|
$
|
3,824,047
|
|
|
$
|
3,637,226
|
|
Storage
|
2,028,427
|
|
|
1,902,764
|
|
||
Fuels marketing
|
39,893
|
|
|
37,252
|
|
||
Total segment assets
|
5,892,367
|
|
|
5,577,242
|
|
||
Assets held for sale
|
301,529
|
|
|
599,347
|
|
||
Other partnership assets
|
185,795
|
|
|
172,551
|
|
||
Total consolidated assets
|
$
|
6,379,691
|
|
|
$
|
6,349,140
|
|
|
NuStar
Energy
|
|
NuStar
Logistics
|
|
NuPOP
|
|
Non-Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cash and cash equivalents
|
$
|
486
|
|
|
$
|
332
|
|
|
$
|
—
|
|
|
$
|
14,481
|
|
|
$
|
—
|
|
|
$
|
15,299
|
|
Receivables, net
|
—
|
|
|
1,692
|
|
|
—
|
|
|
115,996
|
|
|
—
|
|
|
117,688
|
|
||||||
Inventories
|
—
|
|
|
1,924
|
|
|
3,169
|
|
|
4,361
|
|
|
—
|
|
|
9,454
|
|
||||||
Prepaid and other current assets
|
110
|
|
|
25,619
|
|
|
1,059
|
|
|
2,803
|
|
|
—
|
|
|
29,591
|
|
||||||
Assets held for sale
|
—
|
|
|
—
|
|
|
—
|
|
|
301,529
|
|
|
—
|
|
|
301,529
|
|
||||||
Intercompany receivable
|
—
|
|
|
1,462,583
|
|
|
—
|
|
|
397,269
|
|
|
(1,859,852
|
)
|
|
—
|
|
||||||
Total current assets
|
596
|
|
|
1,492,150
|
|
|
4,228
|
|
|
836,439
|
|
|
(1,859,852
|
)
|
|
473,561
|
|
||||||
Property, plant and equipment, net
|
—
|
|
|
2,023,613
|
|
|
609,798
|
|
|
1,387,403
|
|
|
—
|
|
|
4,020,814
|
|
||||||
Intangible assets, net
|
—
|
|
|
44,395
|
|
|
—
|
|
|
662,949
|
|
|
—
|
|
|
707,344
|
|
||||||
Goodwill
|
—
|
|
|
149,453
|
|
|
170,652
|
|
|
685,748
|
|
|
—
|
|
|
1,005,853
|
|
||||||
Investment in wholly owned
subsidiaries
|
2,934,489
|
|
|
1,713,256
|
|
|
1,135,618
|
|
|
514,958
|
|
|
(6,298,321
|
)
|
|
—
|
|
||||||
Other long-term assets, net
|
57
|
|
|
103,408
|
|
|
32,557
|
|
|
36,097
|
|
|
—
|
|
|
172,119
|
|
||||||
Total assets
|
$
|
2,935,142
|
|
|
$
|
5,526,275
|
|
|
$
|
1,952,853
|
|
|
$
|
4,123,594
|
|
|
$
|
(8,158,173
|
)
|
|
$
|
6,379,691
|
|
Liabilities, Mezzanine Equity and Partners’ Equity
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Accounts payable
|
$
|
5,586
|
|
|
$
|
51,193
|
|
|
$
|
6,287
|
|
|
$
|
65,481
|
|
|
$
|
—
|
|
|
$
|
128,547
|
|
Short-term debt and current portion of finance leases
|
—
|
|
|
9,940
|
|
|
131
|
|
|
16
|
|
|
—
|
|
|
10,087
|
|
||||||
Accrued interest payable
|
—
|
|
|
38,891
|
|
|
—
|
|
|
38
|
|
|
—
|
|
|
38,929
|
|
||||||
Accrued liabilities
|
866
|
|
|
28,558
|
|
|
8,942
|
|
|
31,604
|
|
|
—
|
|
|
69,970
|
|
||||||
Taxes other than income tax
|
8
|
|
|
6,090
|
|
|
5,955
|
|
|
2,007
|
|
|
—
|
|
|
14,060
|
|
||||||
Income tax payable
|
—
|
|
|
217
|
|
|
1
|
|
|
1,702
|
|
|
—
|
|
|
1,920
|
|
||||||
Liabilities held for sale
|
—
|
|
|
—
|
|
|
—
|
|
|
68,616
|
|
|
—
|
|
|
68,616
|
|
||||||
Intercompany payable
|
459,119
|
|
|
—
|
|
|
1,400,733
|
|
|
—
|
|
|
(1,859,852
|
)
|
|
—
|
|
||||||
Total current liabilities
|
465,579
|
|
|
134,889
|
|
|
1,422,049
|
|
|
169,464
|
|
|
(1,859,852
|
)
|
|
332,129
|
|
||||||
Long-term debt
|
—
|
|
|
3,393,447
|
|
|
512
|
|
|
62,502
|
|
|
—
|
|
|
3,456,461
|
|
||||||
Deferred income tax liability
|
—
|
|
|
1,675
|
|
|
9
|
|
|
10,566
|
|
|
—
|
|
|
12,250
|
|
||||||
Other long-term liabilities
|
—
|
|
|
88,772
|
|
|
15,471
|
|
|
72,708
|
|
|
—
|
|
|
176,951
|
|
||||||
Series D preferred units
|
572,597
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
572,597
|
|
||||||
Total partners’ equity
|
1,896,966
|
|
|
1,907,492
|
|
|
514,812
|
|
|
3,808,354
|
|
|
(6,298,321
|
)
|
|
1,829,303
|
|
||||||
Total liabilities, mezzanine equity and partners’ equity
|
$
|
2,935,142
|
|
|
$
|
5,526,275
|
|
|
$
|
1,952,853
|
|
|
$
|
4,123,594
|
|
|
$
|
(8,158,173
|
)
|
|
$
|
6,379,691
|
|
|
NuStar
Energy
|
|
NuStar
Logistics
|
|
NuPOP
|
|
Non-Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cash and cash equivalents
|
$
|
1,255
|
|
|
$
|
51
|
|
|
$
|
—
|
|
|
$
|
10,223
|
|
|
$
|
—
|
|
|
$
|
11,529
|
|
Receivables, net
|
—
|
|
|
2,212
|
|
|
—
|
|
|
108,205
|
|
|
—
|
|
|
110,417
|
|
||||||
Inventories
|
—
|
|
|
1,741
|
|
|
5,237
|
|
|
1,456
|
|
|
—
|
|
|
8,434
|
|
||||||
Prepaid and other current assets
|
61
|
|
|
14,422
|
|
|
908
|
|
|
1,983
|
|
|
—
|
|
|
17,374
|
|
||||||
Assets held for sale
|
—
|
|
|
—
|
|
|
—
|
|
|
599,347
|
|
|
—
|
|
|
599,347
|
|
||||||
Intercompany receivable
|
—
|
|
|
1,327,833
|
|
|
—
|
|
|
500,583
|
|
|
(1,828,416
|
)
|
|
—
|
|
||||||
Total current assets
|
1,316
|
|
|
1,346,259
|
|
|
6,145
|
|
|
1,221,797
|
|
|
(1,828,416
|
)
|
|
747,101
|
|
||||||
Property, plant and equipment, net
|
—
|
|
|
1,858,264
|
|
|
615,549
|
|
|
1,300,989
|
|
|
—
|
|
|
3,774,802
|
|
||||||
Intangible assets, net
|
—
|
|
|
49,107
|
|
|
—
|
|
|
683,949
|
|
|
—
|
|
|
733,056
|
|
||||||
Goodwill
|
—
|
|
|
149,453
|
|
|
170,652
|
|
|
685,748
|
|
|
—
|
|
|
1,005,853
|
|
||||||
Investment in wholly owned
subsidiaries
|
3,355,636
|
|
|
1,750,256
|
|
|
1,425,283
|
|
|
857,485
|
|
|
(7,388,660
|
)
|
|
—
|
|
||||||
Other long-term assets, net
|
304
|
|
|
54,429
|
|
|
26,716
|
|
|
6,879
|
|
|
—
|
|
|
88,328
|
|
||||||
Total assets
|
$
|
3,357,256
|
|
|
$
|
5,207,768
|
|
|
$
|
2,244,345
|
|
|
$
|
4,756,847
|
|
|
$
|
(9,217,076
|
)
|
|
$
|
6,349,140
|
|
Liabilities, Mezzanine Equity and Partners’ Equity
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Accounts payable
|
$
|
6,460
|
|
|
$
|
39,680
|
|
|
$
|
6,331
|
|
|
$
|
50,651
|
|
|
$
|
—
|
|
|
$
|
103,122
|
|
Short-term debt
|
—
|
|
|
18,500
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
18,500
|
|
||||||
Accrued interest payable
|
—
|
|
|
36,253
|
|
|
—
|
|
|
40
|
|
|
—
|
|
|
36,293
|
|
||||||
Accrued liabilities
|
1,280
|
|
|
24,858
|
|
|
8,082
|
|
|
40,198
|
|
|
—
|
|
|
74,418
|
|
||||||
Taxes other than income tax
|
125
|
|
|
7,285
|
|
|
4,718
|
|
|
4,695
|
|
|
—
|
|
|
16,823
|
|
||||||
Income tax payable
|
—
|
|
|
457
|
|
|
2
|
|
|
3,986
|
|
|
—
|
|
|
4,445
|
|
||||||
Liabilities held for sale
|
—
|
|
|
—
|
|
|
—
|
|
|
69,834
|
|
|
—
|
|
|
69,834
|
|
||||||
Intercompany payable
|
472,790
|
|
|
—
|
|
|
1,355,626
|
|
|
—
|
|
|
(1,828,416
|
)
|
|
—
|
|
||||||
Total current liabilities
|
480,655
|
|
|
127,033
|
|
|
1,374,759
|
|
|
169,404
|
|
|
(1,828,416
|
)
|
|
323,435
|
|
||||||
Long-term debt
|
—
|
|
|
3,050,531
|
|
|
—
|
|
|
61,465
|
|
|
—
|
|
|
3,111,996
|
|
||||||
Deferred income tax liability
|
—
|
|
|
1,675
|
|
|
9
|
|
|
10,744
|
|
|
—
|
|
|
12,428
|
|
||||||
Other long-term liabilities
|
—
|
|
|
28,392
|
|
|
12,348
|
|
|
38,818
|
|
|
—
|
|
|
79,558
|
|
||||||
Series D preferred units
|
563,992
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
563,992
|
|
||||||
Total partners’ equity
|
2,312,609
|
|
|
2,000,137
|
|
|
857,229
|
|
|
4,476,416
|
|
|
(7,388,660
|
)
|
|
2,257,731
|
|
||||||
Total liabilities, mezzanine equity and partners’ equity
|
$
|
3,357,256
|
|
|
$
|
5,207,768
|
|
|
$
|
2,244,345
|
|
|
$
|
4,756,847
|
|
|
$
|
(9,217,076
|
)
|
|
$
|
6,349,140
|
|
|
NuStar
Energy
|
|
NuStar
Logistics
|
|
NuPOP
|
|
Non-Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||||
Revenues
|
$
|
—
|
|
|
$
|
130,136
|
|
|
$
|
64,452
|
|
|
$
|
178,042
|
|
|
$
|
(185
|
)
|
|
$
|
372,445
|
|
Costs and expenses
|
699
|
|
|
83,029
|
|
|
41,235
|
|
|
154,384
|
|
|
(185
|
)
|
|
279,162
|
|
||||||
Operating (loss) income
|
(699
|
)
|
|
47,107
|
|
|
23,217
|
|
|
23,658
|
|
|
—
|
|
|
93,283
|
|
||||||
Equity in earnings of subsidiaries
|
47,499
|
|
|
10,990
|
|
|
13,785
|
|
|
35,339
|
|
|
(107,613
|
)
|
|
—
|
|
||||||
Interest income (expense), net
|
117
|
|
|
(47,016
|
)
|
|
(1,840
|
)
|
|
3,046
|
|
|
—
|
|
|
(45,693
|
)
|
||||||
Other income (expense), net
|
—
|
|
|
743
|
|
|
178
|
|
|
(300
|
)
|
|
—
|
|
|
621
|
|
||||||
Income from continuing operations before income tax expense (benefit)
|
46,917
|
|
|
11,824
|
|
|
35,340
|
|
|
61,743
|
|
|
(107,613
|
)
|
|
48,211
|
|
||||||
Income tax expense (benefit)
|
2
|
|
|
(469
|
)
|
|
1
|
|
|
1,762
|
|
|
—
|
|
|
1,296
|
|
||||||
Income from continuing
operations, net of tax
|
46,915
|
|
|
12,293
|
|
|
35,339
|
|
|
59,981
|
|
|
(107,613
|
)
|
|
46,915
|
|
||||||
(Loss) income from discontinued
operations, net of tax (a)
|
(964
|
)
|
|
7,912
|
|
|
(8,877
|
)
|
|
(17,752
|
)
|
|
18,717
|
|
|
(964
|
)
|
||||||
Net income
|
$
|
45,951
|
|
|
$
|
20,205
|
|
|
$
|
26,462
|
|
|
$
|
42,229
|
|
|
$
|
(88,896
|
)
|
|
$
|
45,951
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Comprehensive income
|
$
|
45,951
|
|
|
$
|
11,426
|
|
|
$
|
26,462
|
|
|
$
|
43,049
|
|
|
$
|
(88,896
|
)
|
|
$
|
37,992
|
|
|
NuStar
Energy
|
|
NuStar
Logistics
|
|
NuPOP
|
|
Non-Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||||
Revenues
|
$
|
—
|
|
|
$
|
117,862
|
|
|
$
|
66,505
|
|
|
$
|
205,036
|
|
|
$
|
(147
|
)
|
|
$
|
389,256
|
|
Costs and expenses
|
538
|
|
|
86,588
|
|
|
42,324
|
|
|
183,566
|
|
|
(147
|
)
|
|
312,869
|
|
||||||
Operating (loss) income
|
(538
|
)
|
|
31,274
|
|
|
24,181
|
|
|
21,470
|
|
|
—
|
|
|
76,387
|
|
||||||
Equity in earnings of subsidiaries
|
27,410
|
|
|
1,692
|
|
|
20,655
|
|
|
43,183
|
|
|
(92,940
|
)
|
|
—
|
|
||||||
Interest income (expense), net
|
37
|
|
|
(50,357
|
)
|
|
(1,724
|
)
|
|
3,655
|
|
|
—
|
|
|
(48,389
|
)
|
||||||
Other income (expense), net
|
—
|
|
|
1,848
|
|
|
73
|
|
|
(314
|
)
|
|
—
|
|
|
1,607
|
|
||||||
Income (loss) from continuing operations before income tax expense
|
26,909
|
|
|
(15,543
|
)
|
|
43,185
|
|
|
67,994
|
|
|
(92,940
|
)
|
|
29,605
|
|
||||||
Income tax expense
|
—
|
|
|
61
|
|
|
—
|
|
|
2,635
|
|
|
—
|
|
|
2,696
|
|
||||||
Income (loss) from continuing
operations, net of tax |
26,909
|
|
|
(15,604
|
)
|
|
43,185
|
|
|
65,359
|
|
|
(92,940
|
)
|
|
26,909
|
|
||||||
Income from discontinued
operations, net of tax (a) |
2,490
|
|
|
—
|
|
|
2,490
|
|
|
4,980
|
|
|
(7,470
|
)
|
|
2,490
|
|
||||||
Net income (loss)
|
$
|
29,399
|
|
|
$
|
(15,604
|
)
|
|
$
|
45,675
|
|
|
$
|
70,339
|
|
|
$
|
(100,410
|
)
|
|
$
|
29,399
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Comprehensive income (loss)
|
$
|
29,399
|
|
|
$
|
(9,336
|
)
|
|
$
|
45,675
|
|
|
$
|
61,450
|
|
|
$
|
(100,410
|
)
|
|
$
|
26,778
|
|
|
NuStar
Energy
|
|
NuStar
Logistics
|
|
NuPOP
|
|
Non-Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||||
Revenues
|
$
|
—
|
|
|
$
|
247,691
|
|
|
$
|
122,805
|
|
|
$
|
350,147
|
|
|
$
|
(372
|
)
|
|
$
|
720,271
|
|
Costs and expenses
|
1,375
|
|
|
160,440
|
|
|
77,285
|
|
|
314,655
|
|
|
(372
|
)
|
|
553,383
|
|
||||||
Operating (loss) income
|
(1,375
|
)
|
|
87,251
|
|
|
45,520
|
|
|
35,492
|
|
|
—
|
|
|
166,888
|
|
||||||
Equity in earnings of subsidiaries
|
76,990
|
|
|
12,329
|
|
|
26,523
|
|
|
68,624
|
|
|
(184,466
|
)
|
|
—
|
|
||||||
Interest income (expense), net
|
225
|
|
|
(92,472
|
)
|
|
(3,773
|
)
|
|
6,036
|
|
|
—
|
|
|
(89,984
|
)
|
||||||
Other income (expense), net
|
—
|
|
|
1,497
|
|
|
355
|
|
|
(440
|
)
|
|
—
|
|
|
1,412
|
|
||||||
Income from continuing operations before income tax expense (benefit)
|
75,840
|
|
|
8,605
|
|
|
68,625
|
|
|
109,712
|
|
|
(184,466
|
)
|
|
78,316
|
|
||||||
Income tax expense (benefit)
|
2
|
|
|
(352
|
)
|
|
1
|
|
|
2,827
|
|
|
—
|
|
|
2,478
|
|
||||||
Income from continuing
operations, net of tax
|
75,838
|
|
|
8,957
|
|
|
68,624
|
|
|
106,885
|
|
|
(184,466
|
)
|
|
75,838
|
|
||||||
(Loss) income from discontinued
operations, net of tax (a)
|
(307,750
|
)
|
|
7,912
|
|
|
(315,663
|
)
|
|
(631,324
|
)
|
|
939,075
|
|
|
(307,750
|
)
|
||||||
Net (loss) income
|
(231,912
|
)
|
|
16,869
|
|
|
(247,039
|
)
|
|
(524,439
|
)
|
|
754,609
|
|
|
(231,912
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Comprehensive (loss) income
|
$
|
(231,912
|
)
|
|
$
|
2,360
|
|
|
$
|
(247,039
|
)
|
|
$
|
(522,715
|
)
|
|
$
|
754,609
|
|
|
$
|
(244,697
|
)
|
|
NuStar
Energy
|
|
NuStar
Logistics
|
|
NuPOP
|
|
Non-Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||||
Revenues
|
$
|
—
|
|
|
$
|
237,556
|
|
|
$
|
122,779
|
|
|
$
|
405,997
|
|
|
$
|
(349
|
)
|
|
$
|
765,983
|
|
Costs and expenses
|
1,150
|
|
|
159,004
|
|
|
77,505
|
|
|
368,793
|
|
|
(349
|
)
|
|
606,103
|
|
||||||
Operating (loss) income
|
(1,150
|
)
|
|
78,552
|
|
|
45,274
|
|
|
37,204
|
|
|
—
|
|
|
159,880
|
|
||||||
Equity in earnings (loss) of
subsidiaries |
61,223
|
|
|
(557
|
)
|
|
39,758
|
|
|
81,922
|
|
|
(182,346
|
)
|
|
—
|
|
||||||
Interest income (expense), net
|
69
|
|
|
(100,383
|
)
|
|
(3,295
|
)
|
|
7,832
|
|
|
—
|
|
|
(95,777
|
)
|
||||||
Other income, net
|
—
|
|
|
2,324
|
|
|
188
|
|
|
111
|
|
|
—
|
|
|
2,623
|
|
||||||
Income (loss) from continuing operations before income tax expense
|
60,142
|
|
|
(20,064
|
)
|
|
81,925
|
|
|
127,069
|
|
|
(182,346
|
)
|
|
66,726
|
|
||||||
Income tax expense
|
—
|
|
|
231
|
|
|
1
|
|
|
6,352
|
|
|
—
|
|
|
6,584
|
|
||||||
Income (loss) from continuing
operations, net of tax |
60,142
|
|
|
(20,295
|
)
|
|
81,924
|
|
|
120,717
|
|
|
(182,346
|
)
|
|
60,142
|
|
||||||
Income from discontinued
operations, net of tax (a) |
95,390
|
|
|
—
|
|
|
95,390
|
|
|
190,780
|
|
|
(286,170
|
)
|
|
95,390
|
|
||||||
Net income (loss)
|
$
|
155,532
|
|
|
$
|
(20,295
|
)
|
|
$
|
177,314
|
|
|
$
|
311,497
|
|
|
$
|
(468,516
|
)
|
|
$
|
155,532
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Comprehensive income
|
$
|
155,532
|
|
|
$
|
4,784
|
|
|
$
|
177,314
|
|
|
$
|
304,721
|
|
|
$
|
(468,516
|
)
|
|
$
|
173,835
|
|
|
NuStar
Energy
|
|
NuStar
Logistics
|
|
NuPOP
|
|
Non-Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||||
Net cash provided by operating
activities
|
$
|
187,265
|
|
|
$
|
77,144
|
|
|
$
|
60,539
|
|
|
$
|
200,762
|
|
|
$
|
(284,816
|
)
|
|
$
|
240,894
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Capital expenditures
|
—
|
|
|
(167,647
|
)
|
|
(9,131
|
)
|
|
(143,183
|
)
|
|
—
|
|
|
(319,961
|
)
|
||||||
Change in accounts payable related to capital expenditures
|
—
|
|
|
11,708
|
|
|
522
|
|
|
3,914
|
|
|
—
|
|
|
16,144
|
|
||||||
Proceeds from sale or disposition
of assets
|
—
|
|
|
71
|
|
|
26
|
|
|
46
|
|
|
—
|
|
|
143
|
|
||||||
Investment in subsidiaries
|
—
|
|
|
(11,999
|
)
|
|
—
|
|
|
—
|
|
|
11,999
|
|
|
—
|
|
||||||
Net cash used in investing activities
|
—
|
|
|
(167,867
|
)
|
|
(8,583
|
)
|
|
(139,223
|
)
|
|
11,999
|
|
|
(303,674
|
)
|
||||||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Debt borrowings
|
—
|
|
|
570,500
|
|
|
—
|
|
|
23,800
|
|
|
—
|
|
|
594,300
|
|
||||||
Debt repayments
|
—
|
|
|
(785,000
|
)
|
|
—
|
|
|
(22,800
|
)
|
|
—
|
|
|
(807,800
|
)
|
||||||
Note offering, net of
issuance costs
|
—
|
|
|
491,665
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
491,665
|
|
||||||
Distributions to preferred unitholders
|
(60,846
|
)
|
|
(30,424
|
)
|
|
(30,423
|
)
|
|
(30,425
|
)
|
|
91,272
|
|
|
(60,846
|
)
|
||||||
Distributions to common unitholders
|
(129,025
|
)
|
|
(64,512
|
)
|
|
(64,512
|
)
|
|
(64,520
|
)
|
|
193,544
|
|
|
(129,025
|
)
|
||||||
Contributions from affiliates
|
—
|
|
|
—
|
|
|
—
|
|
|
11,999
|
|
|
(11,999
|
)
|
|
—
|
|
||||||
Net intercompany activity
|
9,641
|
|
|
(75,900
|
)
|
|
43,009
|
|
|
23,250
|
|
|
—
|
|
|
—
|
|
||||||
Payment of tax withholding for unit-based compensation
|
(6,368
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6,368
|
)
|
||||||
Other, net
|
(1,436
|
)
|
|
(6,581
|
)
|
|
(30
|
)
|
|
(122
|
)
|
|
—
|
|
|
(8,169
|
)
|
||||||
Net cash (used in) provided by financing activities
|
(188,034
|
)
|
|
99,748
|
|
|
(51,956
|
)
|
|
(58,818
|
)
|
|
272,817
|
|
|
73,757
|
|
||||||
Effect of foreign exchange rate changes on cash
|
—
|
|
|
—
|
|
|
—
|
|
|
261
|
|
|
—
|
|
|
261
|
|
||||||
Net (decrease) increase in cash, cash equivalents and restricted cash
|
(769
|
)
|
|
9,025
|
|
|
—
|
|
|
2,982
|
|
|
—
|
|
|
11,238
|
|
||||||
Cash, cash equivalents, and restricted cash as of the beginning of the period
|
1,255
|
|
|
51
|
|
|
—
|
|
|
12,338
|
|
|
—
|
|
|
13,644
|
|
||||||
Cash, cash equivalents and restricted cash as of the end of the period
|
$
|
486
|
|
|
$
|
9,076
|
|
|
$
|
—
|
|
|
$
|
15,320
|
|
|
$
|
—
|
|
|
$
|
24,882
|
|
|
NuStar
Energy
|
|
NuStar
Logistics
|
|
NuPOP
|
|
Non-Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||||
Net cash provided by operating
activities
|
$
|
200,803
|
|
|
$
|
31,209
|
|
|
$
|
58,105
|
|
|
$
|
261,300
|
|
|
$
|
(307,567
|
)
|
|
$
|
243,850
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Capital expenditures
|
—
|
|
|
(17,136
|
)
|
|
(8,164
|
)
|
|
(223,221
|
)
|
|
—
|
|
|
(248,521
|
)
|
||||||
Change in accounts payable related to capital expenditures
|
—
|
|
|
495
|
|
|
(5,173
|
)
|
|
(14,642
|
)
|
|
—
|
|
|
(19,320
|
)
|
||||||
Proceeds from sale or disposition
of assets
|
—
|
|
|
1,385
|
|
|
16
|
|
|
696
|
|
|
—
|
|
|
2,097
|
|
||||||
Proceeds from insurance recoveries
|
—
|
|
|
—
|
|
|
—
|
|
|
78,419
|
|
|
—
|
|
|
78,419
|
|
||||||
Acquisitions
|
—
|
|
|
—
|
|
|
(37,502
|
)
|
|
—
|
|
|
—
|
|
|
(37,502
|
)
|
||||||
Net cash used in investing activities
|
—
|
|
|
(15,256
|
)
|
|
(50,823
|
)
|
|
(158,748
|
)
|
|
—
|
|
|
(224,827
|
)
|
||||||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Debt borrowings
|
—
|
|
|
1,122,272
|
|
|
—
|
|
|
11,000
|
|
|
—
|
|
|
1,133,272
|
|
||||||
Debt repayments
|
—
|
|
|
(1,316,621
|
)
|
|
—
|
|
|
(16,900
|
)
|
|
—
|
|
|
(1,333,521
|
)
|
||||||
Issuance of Series D preferred units
|
400,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
400,000
|
|
||||||
Payment of issuance costs for
Series D preferred units |
(29,289
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(29,289
|
)
|
||||||
Issuance of common units
|
10,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10,000
|
|
||||||
Distributions to preferred unitholders
|
(32,713
|
)
|
|
(16,356
|
)
|
|
(16,357
|
)
|
|
(16,358
|
)
|
|
49,071
|
|
|
(32,713
|
)
|
||||||
Distributions to common unitholders and general partner
|
(172,324
|
)
|
|
(86,162
|
)
|
|
(86,162
|
)
|
|
(86,172
|
)
|
|
258,496
|
|
|
(172,324
|
)
|
||||||
Proceeds from termination of
interest rate swaps
|
—
|
|
|
8,048
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8,048
|
|
||||||
Net intercompany activity
|
(374,973
|
)
|
|
279,080
|
|
|
95,237
|
|
|
656
|
|
|
—
|
|
|
—
|
|
||||||
Other, net
|
(1,493
|
)
|
|
(4,466
|
)
|
|
—
|
|
|
(64
|
)
|
|
—
|
|
|
(6,023
|
)
|
||||||
Net cash used in financing activities
|
(200,792
|
)
|
|
(14,205
|
)
|
|
(7,282
|
)
|
|
(107,838
|
)
|
|
307,567
|
|
|
(22,550
|
)
|
||||||
Effect of foreign exchange rate
changes on cash
|
—
|
|
|
—
|
|
|
—
|
|
|
(421
|
)
|
|
—
|
|
|
(421
|
)
|
||||||
Net increase (decrease) in cash and
cash equivalents
|
11
|
|
|
1,748
|
|
|
—
|
|
|
(5,707
|
)
|
|
—
|
|
|
(3,948
|
)
|
||||||
Cash and cash equivalents as of the
beginning of the period
|
885
|
|
|
29
|
|
|
—
|
|
|
23,378
|
|
|
—
|
|
|
24,292
|
|
||||||
Cash and cash equivalents as of the
end of the period
|
$
|
896
|
|
|
$
|
1,777
|
|
|
$
|
—
|
|
|
$
|
17,671
|
|
|
$
|
—
|
|
|
$
|
20,344
|
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
•
|
Overview
|
•
|
Results of Operations
|
•
|
Trends and Outlook
|
•
|
Liquidity and Capital Resources
|
•
|
Critical Accounting Policies
|
•
|
New Accounting Pronouncements
|
•
|
company-specific factors, such as facility integrity issues and maintenance requirements that impact the throughput rates of our assets;
|
•
|
seasonal factors that affect the demand for products transported by and/or stored in our assets and the demand for products we sell;
|
•
|
industry factors, such as changes in the prices of petroleum products that affect demand and the operations of our competitors;
|
•
|
economic factors, such as commodity price volatility, that impact our fuels marketing segment; and
|
•
|
factors that impact the operations served by our pipeline and storage assets, such as utilization rates and maintenance turnaround schedules of our refining company customers and drilling activity by our crude oil production customers.
|
|
Three Months Ended June 30,
|
|
Change
|
||||||||
|
2019
|
|
2018
|
|
|||||||
Statement of Income Data:
|
|
|
|
|
|
||||||
Revenues:
|
|
|
|
|
|
||||||
Service revenues
|
$
|
282,472
|
|
|
$
|
259,599
|
|
|
$
|
22,873
|
|
Product sales
|
89,973
|
|
|
129,657
|
|
|
(39,684
|
)
|
|||
Total revenues
|
372,445
|
|
|
389,256
|
|
|
(16,811
|
)
|
|||
|
|
|
|
|
|
||||||
Costs and expenses:
|
|
|
|
|
|
||||||
Costs associated with service revenues
|
166,086
|
|
|
164,018
|
|
|
2,068
|
|
|||
Cost of product sales
|
86,389
|
|
|
119,939
|
|
|
(33,550
|
)
|
|||
General and administrative expenses
|
24,868
|
|
|
26,754
|
|
|
(1,886
|
)
|
|||
Other depreciation and amortization expense
|
1,819
|
|
|
2,158
|
|
|
(339
|
)
|
|||
Total costs and expenses
|
279,162
|
|
|
312,869
|
|
|
(33,707
|
)
|
|||
|
|
|
|
|
|
||||||
Operating income
|
93,283
|
|
|
76,387
|
|
|
16,896
|
|
|||
Interest expense, net
|
(45,693
|
)
|
|
(48,389
|
)
|
|
2,696
|
|
|||
Other income, net
|
621
|
|
|
1,607
|
|
|
(986
|
)
|
|||
Income from continuing operations before income tax expense
|
48,211
|
|
|
29,605
|
|
|
18,606
|
|
|||
Income tax expense
|
1,296
|
|
|
2,696
|
|
|
(1,400
|
)
|
|||
Income from continuing operations, net of tax
|
46,915
|
|
|
26,909
|
|
|
20,006
|
|
|||
(Loss) income from discontinued operations, net of tax
|
(964
|
)
|
|
2,490
|
|
|
(3,454
|
)
|
|||
Net income
|
$
|
45,951
|
|
|
$
|
29,399
|
|
|
$
|
16,552
|
|
Basic net income (loss) per common unit:
|
|
|
|
|
|
||||||
Continuing operations
|
$
|
0.11
|
|
|
$
|
0.12
|
|
|
$
|
(0.01
|
)
|
Discontinued operations
|
(0.01
|
)
|
|
0.03
|
|
|
(0.04
|
)
|
|||
Total
|
$
|
0.10
|
|
|
$
|
0.15
|
|
|
$
|
(0.05
|
)
|
|
Three Months Ended June 30,
|
|
Change
|
||||||||
|
2019
|
|
2018
|
|
|||||||
Pipeline:
|
|
|
|
|
|
||||||
Crude oil pipelines throughput (barrels/day)
|
1,089,848
|
|
|
839,574
|
|
|
250,274
|
|
|||
Refined products and ammonia pipelines throughput (barrels/day)
|
569,820
|
|
|
565,740
|
|
|
4,080
|
|
|||
Total throughput (barrels/day)
|
1,659,668
|
|
|
1,405,314
|
|
|
254,354
|
|
|||
Throughput revenues
|
$
|
172,493
|
|
|
$
|
150,276
|
|
|
$
|
22,217
|
|
Operating expenses
|
52,930
|
|
|
48,706
|
|
|
4,224
|
|
|||
Depreciation and amortization expense
|
40,851
|
|
|
38,591
|
|
|
2,260
|
|
|||
Segment operating income
|
$
|
78,712
|
|
|
$
|
62,979
|
|
|
$
|
15,733
|
|
Storage:
|
|
|
|
|
|
||||||
Throughput (barrels/day)
|
395,512
|
|
|
331,917
|
|
|
63,595
|
|
|||
Throughput terminal revenues
|
$
|
23,170
|
|
|
$
|
20,141
|
|
|
$
|
3,029
|
|
Storage terminal revenues
|
87,233
|
|
|
94,679
|
|
|
(7,446
|
)
|
|||
Total revenues
|
110,403
|
|
|
114,820
|
|
|
(4,417
|
)
|
|||
Operating expenses
|
48,165
|
|
|
52,853
|
|
|
(4,688
|
)
|
|||
Depreciation and amortization expense
|
24,140
|
|
|
23,186
|
|
|
954
|
|
|||
Segment operating income
|
$
|
38,098
|
|
|
$
|
38,781
|
|
|
$
|
(683
|
)
|
Fuels Marketing:
|
|
|
|
|
|
||||||
Product sales and other revenue
|
$
|
89,549
|
|
|
$
|
124,293
|
|
|
$
|
(34,744
|
)
|
Cost of goods
|
85,802
|
|
|
119,942
|
|
|
(34,140
|
)
|
|||
Gross margin
|
3,747
|
|
|
4,351
|
|
|
(604
|
)
|
|||
Operating expenses
|
587
|
|
|
815
|
|
|
(228
|
)
|
|||
Segment operating income
|
$
|
3,160
|
|
|
$
|
3,536
|
|
|
$
|
(376
|
)
|
Consolidation and Intersegment Eliminations:
|
|
|
|
|
|
||||||
Revenues
|
$
|
—
|
|
|
$
|
(133
|
)
|
|
$
|
133
|
|
Cost of goods
|
—
|
|
|
(3
|
)
|
|
3
|
|
|||
Operating expenses
|
—
|
|
|
(133
|
)
|
|
133
|
|
|||
Total
|
$
|
—
|
|
|
$
|
3
|
|
|
$
|
(3
|
)
|
Consolidated Information:
|
|
|
|
|
|
||||||
Revenues
|
$
|
372,445
|
|
|
$
|
389,256
|
|
|
$
|
(16,811
|
)
|
Costs associated with service revenues:
|
|
|
|
|
|
||||||
Operating expenses
|
101,095
|
|
|
102,241
|
|
|
(1,146
|
)
|
|||
Depreciation and amortization expense
|
64,991
|
|
|
61,777
|
|
|
3,214
|
|
|||
Total costs associated with service revenues
|
166,086
|
|
|
164,018
|
|
|
2,068
|
|
|||
Cost of product sales
|
86,389
|
|
|
119,939
|
|
|
(33,550
|
)
|
|||
Segment operating income
|
119,970
|
|
|
105,299
|
|
|
14,671
|
|
|||
General and administrative expenses
|
24,868
|
|
|
26,754
|
|
|
(1,886
|
)
|
|||
Other depreciation and amortization expense
|
1,819
|
|
|
2,158
|
|
|
(339
|
)
|
|||
Consolidated operating income
|
$
|
93,283
|
|
|
$
|
76,387
|
|
|
$
|
16,896
|
|
•
|
an increase in revenues of $14.1 million and an increase in throughputs of 115,286 barrels per day resulting from increased customer production supplying our Permian Crude System and the completion of new pipeline connections and expansion projects;
|
•
|
an increase in revenues of $3.2 million and an increase in throughputs of 2,384 barrels per day on our Ardmore System, mainly due to an increase in long-haul deliveries resulting in higher average tariffs and the completion of new pipeline connections that began delivering incremental Permian crude oil in the second quarter of 2019 from Wichita Falls to local refiners and a connected carrier;
|
•
|
an increase in revenues of $2.3 million on our Houston pipeline, as a customer began leasing a portion of the pipeline on January 1, 2019;
|
•
|
an increase in revenues of $1.5 million on our Ammonia Pipeline mainly due to a tariff rate increase in 2019;
|
•
|
an increase in revenues of $1.2 million and an increase in throughputs of 4,512 barrels per day on our North Pipeline, primarily due to favorable market conditions in locations served by the North Pipeline; and
|
•
|
an increase in revenues of $1.2 million on our McKee System pipelines, mainly due to an increase in long-haul deliveries resulting in higher average tariffs.
|
•
|
a decrease in revenues of $2.8 million, despite a slight increase in throughputs on our East Pipeline, due to a decrease in other product sales and lower average tariffs; and
|
•
|
a decrease in revenues of $0.7 million on our Eagle Ford System, mainly due to lower rates, which more than offset an increase in throughputs of 136,538 barrels per day.
|
•
|
an increase in power costs of $1.7 million, spread across various pipeline systems as a result of higher throughputs;
|
•
|
an increase of $0.8 million due to ad valorem tax rate increases across all pipeline systems; and
|
•
|
an increase in salaries and wages of $0.7 million.
|
•
|
a decrease in revenues of $10.3 million at our North East Terminals, mainly due to the re-contracting of certain customer contracts in a backwardated market and an adjustment to revenues in 2018 resulting from a change in the term of a contract at our Linden terminal; and
|
•
|
a decrease in revenues of $1.1 million at our Point Tupper terminal, primarily due to a decrease in throughput and handling fees.
|
|
Six Months Ended June 30,
|
|
Change
|
||||||||
|
2019
|
|
2018
|
|
|||||||
Statement of Income Data:
|
|
|
|
|
|
||||||
Revenues:
|
|
|
|
|
|
||||||
Service revenues
|
$
|
541,499
|
|
|
$
|
507,668
|
|
|
$
|
33,831
|
|
Product sales
|
178,772
|
|
|
258,315
|
|
|
(79,543
|
)
|
|||
Total revenues
|
720,271
|
|
|
765,983
|
|
|
(45,712
|
)
|
|||
|
|
|
|
|
|
||||||
Costs and expenses:
|
|
|
|
|
|
||||||
Costs associated with service revenues
|
326,315
|
|
|
311,921
|
|
|
14,394
|
|
|||
Cost of product sales
|
172,571
|
|
|
245,089
|
|
|
(72,518
|
)
|
|||
General and administrative expenses
|
50,559
|
|
|
44,896
|
|
|
5,663
|
|
|||
Other depreciation and amortization expense
|
3,938
|
|
|
4,197
|
|
|
(259
|
)
|
|||
Total costs and expenses
|
553,383
|
|
|
606,103
|
|
|
(52,720
|
)
|
|||
|
|
|
|
|
|
||||||
Operating income
|
166,888
|
|
|
159,880
|
|
|
7,008
|
|
|||
Interest expense, net
|
(89,984
|
)
|
|
(95,777
|
)
|
|
5,793
|
|
|||
Other income, net
|
1,412
|
|
|
2,623
|
|
|
(1,211
|
)
|
|||
Income from continuing operations before income tax expense
|
78,316
|
|
|
66,726
|
|
|
11,590
|
|
|||
Income tax expense
|
2,478
|
|
|
6,584
|
|
|
(4,106
|
)
|
|||
Income from continuing operations, net of tax
|
75,838
|
|
|
60,142
|
|
|
15,696
|
|
|||
(Loss) income from discontinued operations, net of tax
|
(307,750
|
)
|
|
95,390
|
|
|
(403,140
|
)
|
|||
Net (loss) income
|
$
|
(231,912
|
)
|
|
$
|
155,532
|
|
|
$
|
(387,444
|
)
|
Basic net income (loss) per common unit:
|
|
|
|
|
|
||||||
Continuing operations
|
$
|
0.05
|
|
|
$
|
0.30
|
|
|
$
|
(0.25
|
)
|
Discontinued operations
|
(2.86
|
)
|
|
1.00
|
|
|
(3.86
|
)
|
|||
Total
|
$
|
(2.81
|
)
|
|
$
|
1.30
|
|
|
$
|
(4.11
|
)
|
|
Six Months Ended June 30,
|
|
Change
|
||||||||
|
2019
|
|
2018
|
|
|||||||
Pipeline:
|
|
|
|
|
|
||||||
Crude oil pipelines throughput (barrels/day)
|
1,054,425
|
|
|
815,568
|
|
|
238,857
|
|
|||
Refined products and ammonia pipelines throughput (barrels/day)
|
536,836
|
|
|
548,910
|
|
|
(12,074
|
)
|
|||
Total throughput (barrels/day)
|
1,591,261
|
|
|
1,364,478
|
|
|
226,783
|
|
|||
Throughput revenues
|
$
|
328,744
|
|
|
$
|
287,066
|
|
|
$
|
41,678
|
|
Operating expenses
|
101,028
|
|
|
91,047
|
|
|
9,981
|
|
|||
Depreciation and amortization expense
|
81,700
|
|
|
75,246
|
|
|
6,454
|
|
|||
Segment operating income
|
$
|
146,016
|
|
|
$
|
120,773
|
|
|
$
|
25,243
|
|
Storage:
|
|
|
|
|
|
||||||
Throughput (barrels/day)
|
380,267
|
|
|
337,892
|
|
|
42,375
|
|
|||
Throughput terminal revenues
|
$
|
44,856
|
|
|
$
|
40,157
|
|
|
$
|
4,699
|
|
Storage terminal revenues
|
169,047
|
|
|
186,083
|
|
|
(17,036
|
)
|
|||
Total revenues
|
213,903
|
|
|
226,240
|
|
|
(12,337
|
)
|
|||
Operating expenses
|
95,478
|
|
|
98,017
|
|
|
(2,539
|
)
|
|||
Depreciation and amortization expense
|
48,109
|
|
|
46,355
|
|
|
1,754
|
|
|||
Segment operating income
|
$
|
70,316
|
|
|
$
|
81,868
|
|
|
$
|
(11,552
|
)
|
Fuels Marketing:
|
|
|
|
|
|
||||||
Product sales and other revenue
|
$
|
177,628
|
|
|
$
|
252,951
|
|
|
$
|
(75,323
|
)
|
Cost of goods
|
171,303
|
|
|
245,107
|
|
|
(73,804
|
)
|
|||
Gross margin
|
6,325
|
|
|
7,844
|
|
|
(1,519
|
)
|
|||
Operating expenses
|
1,240
|
|
|
1,512
|
|
|
(272
|
)
|
|||
Segment operating income
|
$
|
5,085
|
|
|
$
|
6,332
|
|
|
$
|
(1,247
|
)
|
Consolidation and Intersegment Eliminations:
|
|
|
|
|
|
||||||
Revenues
|
$
|
(4
|
)
|
|
$
|
(274
|
)
|
|
$
|
270
|
|
Cost of goods
|
28
|
|
|
(18
|
)
|
|
46
|
|
|||
Operating expenses
|
—
|
|
|
(256
|
)
|
|
256
|
|
|||
Total
|
$
|
(32
|
)
|
|
$
|
—
|
|
|
$
|
(32
|
)
|
Consolidated Information:
|
|
|
|
|
|
||||||
Revenues
|
$
|
720,271
|
|
|
$
|
765,983
|
|
|
$
|
(45,712
|
)
|
Costs associated with service revenues:
|
|
|
|
|
|
||||||
Operating expenses
|
196,506
|
|
|
190,320
|
|
|
6,186
|
|
|||
Depreciation and amortization expense
|
129,809
|
|
|
121,601
|
|
|
8,208
|
|
|||
Total costs associated with service revenues
|
326,315
|
|
|
311,921
|
|
|
14,394
|
|
|||
Cost of product sales
|
172,571
|
|
|
245,089
|
|
|
(72,518
|
)
|
|||
Segment operating income
|
221,385
|
|
|
208,973
|
|
|
12,412
|
|
|||
General and administrative expenses
|
50,559
|
|
|
44,896
|
|
|
5,663
|
|
|||
Other depreciation and amortization expense
|
3,938
|
|
|
4,197
|
|
|
(259
|
)
|
|||
Consolidated operating income
|
$
|
166,888
|
|
|
$
|
159,880
|
|
|
$
|
7,008
|
|
•
|
an increase in revenues of $30.2 million and an increase in throughputs of 131,973 barrels per day resulting from increased customer production supplying our Permian Crude System and the completion of new pipeline connections and expansion projects;
|
•
|
an increase in revenues of $7.0 million on our Ardmore System, despite throughputs that remained flat, mainly due to an increase in long-haul deliveries resulting in higher average tariffs and the completion of new pipeline connections that began delivering incremental Permian crude oil in the second quarter of 2019 from Wichita Falls to local refiners and a connected carrier;
|
•
|
an increase in revenues of $5.0 million on our Houston pipeline, as a customer began leasing a portion of the pipeline on January 1, 2019;
|
•
|
an increase in revenues of $2.2 million on our Ammonia Pipeline mainly due to a tariff rate increase in 2019;
|
•
|
an increase in revenues of $1.9 million and an increase in throughputs of 11,963 barrels per day on our Three Rivers System, mainly due to increased demand; and
|
•
|
an increase in revenues of $1.6 million and an increase in throughputs of 2,907 barrels per day on our North Pipeline, primarily due to favorable market conditions in locations served by the North Pipeline.
|
•
|
a decrease in revenues of $5.1 million and a decrease in throughputs of 51,400 barrels per day due to operational issues at the refinery served by our McKee System pipelines in the first quarter of 2019; and
|
•
|
a decrease in revenues of $3.7 million on our Eagle Ford System, mainly due to lower rates, which more than offset an increase in throughputs of 125,356 barrels per day.
|
•
|
an increase in operating expenses of $6.6 million on our Permian Crude System, mainly due to higher power costs resulting from higher throughputs, as well as higher bad debt expense; and
|
•
|
an increase in operating costs of $1.5 million due to owning the assets associated with the Council Bluffs Acquisition for the entire period in 2019.
|
|
Six Months Ended June 30,
|
||||||
|
2019
|
|
2018
|
||||
|
(Thousands of Dollars)
|
||||||
Net cash provided by (used in):
|
|
|
|
||||
Operating activities
|
$
|
240,894
|
|
|
$
|
243,850
|
|
Investing activities
|
(303,674
|
)
|
|
(224,827
|
)
|
||
Financing activities
|
73,757
|
|
|
(22,550
|
)
|
||
Effect of foreign exchange rate changes on cash
|
261
|
|
|
(421
|
)
|
||
Net increase (decrease) in cash, cash equivalents and restricted cash
|
$
|
11,238
|
|
|
$
|
(3,948
|
)
|
|
Fitch, Inc.
|
|
Moody’s Investor
Service Inc.
|
|
S&P
Global Ratings
|
Ratings
|
BB
|
|
Ba2
|
|
BB-
|
Outlook
|
Stable
|
|
Stable
|
|
Stable
|
•
|
$365.4 million in revenue bonds pursuant to the Gulf Opportunity Zone Act of 2005 (the GoZone Bonds), with $43.1 million remaining in trust as of June 30, 2019, supported by $370.2 million in letters of credit; and
|
•
|
one short-term line of credit agreement with an uncommitted borrowing capacity of up to $35.0 million, with $6.0 million of borrowings outstanding as of June 30, 2019.
|
•
|
strategic capital expenditures, such as those to expand or upgrade the operating capacity, increase efficiency or increase the earnings potential of existing assets, whether through construction or acquisition, as well as certain capital expenditures related to support functions; and
|
•
|
reliability capital expenditures, such as those required to maintain the current operating capacity of existing assets or extend their useful lives, as well as those required to maintain equipment reliability and safety.
|
|
Strategic Acquisitions and
Capital Expenditures
|
|
Reliability Capital
Expenditures
|
|
Total
|
||||||
|
(Thousands of Dollars)
|
||||||||||
For the six months ended June 30:
|
|
|
|
|
|
||||||
2019
|
$
|
292,785
|
|
|
$
|
27,176
|
|
|
$
|
319,961
|
|
2018
|
$
|
244,228
|
|
|
$
|
41,795
|
|
|
$
|
286,023
|
|
|
|
|
|
|
|
||||||
Expected for the year ended December 31, 2019
|
$ 500,000 - 550,000
|
|
|
$ 60,000 - 80,000
|
|
|
|
|
Quarter Ended
|
|
Cash
Distributions
Per Unit
|
|
Total Cash
Distributions
|
|
Record Date
|
|
Payment Date
|
||||
|
|
|
|
(Thousands of Dollars)
|
|
|
|
|
||||
June 30, 2019
|
|
$
|
0.60
|
|
|
$
|
64,658
|
|
|
August 7, 2019
|
|
August 13, 2019
|
March 31, 2019
|
|
$
|
0.60
|
|
|
$
|
64,690
|
|
|
May 8, 2019
|
|
May 14, 2019
|
Units
|
|
Fixed Distribution Rate Per Annum (as a Percentage of the $25.00 Liquidation Preference Per Unit)
|
|
Fixed Distribution Rate Per Unit Per Annum
|
|
Fixed Distribution Per Annum
|
|
Optional Redemption Date/Date at Which Distribution Rate Becomes Floating
|
|
Floating Annual Rate (as a Percentage of the
$25.00 Liquidation
Preference Per Unit)
|
||||
|
|
|
|
|
|
(Thousands of Dollars)
|
|
|
|
|
||||
Series A Preferred Units
|
|
8.50%
|
|
$
|
2.125
|
|
|
$
|
19,253
|
|
|
December 15, 2021
|
|
Three-month LIBOR plus 6.766%
|
Series B Preferred Units
|
|
7.625%
|
|
$
|
1.90625
|
|
|
$
|
29,357
|
|
|
June 15, 2022
|
|
Three-month LIBOR plus 5.643%
|
Series C Preferred Units
|
|
9.00%
|
|
$
|
2.25
|
|
|
$
|
15,525
|
|
|
December 15, 2022
|
|
Three-month LIBOR plus 6.88%
|
•
|
Revolving Credit Agreement due October 29, 2020, with $543.0 million of borrowings outstanding as of June 30, 2019;
|
•
|
4.80% senior notes due September 1, 2020 with a face value of $450.0 million; 6.75% senior notes due February 1, 2021 with a face value of $300.0 million; 4.75% senior notes due February 1, 2022 with a face value of $250.0 million; 6.0% senior notes due June 1, 2026 with a face value of $500.0 million; 5.625% senior notes due April 28, 2027 with a face value of $550.0 million; and subordinated notes due January 15, 2043 with a face value of $402.5 million and a floating interest rate, which was 9.3% as of June 30, 2019;
|
•
|
$365.4 million in GoZone Bonds due from 2038 to 2041;
|
•
|
Line of credit agreement with $6.0 million of borrowings outstanding as of June 30, 2019; and
|
•
|
Receivables Financing Agreement due September 20, 2021, with $62.8 million of borrowings outstanding as of June 30, 2019.
|
Item 3.
|
Quantitative and Qualitative Disclosures About Market Risk
|
|
June 30, 2019
|
||||||||||||||||||||||||||||||
|
Expected Maturity Dates
|
|
|
|
|
||||||||||||||||||||||||||
|
2019
|
|
2020
|
|
2021
|
|
2022
|
|
2023
|
|
There-
after
|
|
Total
|
|
Fair
Value
|
||||||||||||||||
|
(Thousands of Dollars, Except Interest Rates)
|
||||||||||||||||||||||||||||||
Long-term Debt:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Fixed-rate
|
$
|
—
|
|
|
$
|
450,000
|
|
|
$
|
300,000
|
|
|
$
|
250,000
|
|
|
$
|
—
|
|
|
$
|
1,050,000
|
|
|
$
|
2,050,000
|
|
|
$
|
2,098,945
|
|
Weighted-average rate
|
—
|
|
|
4.8
|
%
|
|
6.8
|
%
|
|
4.8
|
%
|
|
—
|
|
|
5.8
|
%
|
|
5.6
|
%
|
|
|
|||||||||
Variable-rate
|
$
|
—
|
|
|
$
|
543,000
|
|
|
$
|
62,800
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
767,940
|
|
|
$
|
1,373,740
|
|
|
$
|
1,374,861
|
|
Weighted-average rate
|
—
|
|
|
4.4
|
%
|
|
3.3
|
%
|
|
—
|
|
|
—
|
|
|
5.8
|
%
|
|
5.1
|
%
|
|
|
|
December 31, 2018
|
||||||||||||||||||||||||||||||
|
Expected Maturity Dates
|
|
|
|
|
||||||||||||||||||||||||||
|
2019
|
|
2020
|
|
2021
|
|
2022
|
|
2023
|
|
There-
after
|
|
Total
|
|
Fair
Value
|
||||||||||||||||
|
(Thousands of Dollars, Except Interest Rates)
|
||||||||||||||||||||||||||||||
Long-term Debt:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Fixed-rate
|
$
|
—
|
|
|
$
|
450,000
|
|
|
$
|
300,000
|
|
|
$
|
250,000
|
|
|
$
|
—
|
|
|
$
|
550,000
|
|
|
$
|
1,550,000
|
|
|
$
|
1,499,920
|
|
Weighted-average rate
|
—
|
|
|
4.8
|
%
|
|
6.8
|
%
|
|
4.8
|
%
|
|
—
|
|
|
5.6
|
%
|
|
5.5
|
%
|
|
|
|||||||||
Variable-rate
|
$
|
—
|
|
|
$
|
806,800
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
767,940
|
|
|
$
|
1,574,740
|
|
|
$
|
1,556,784
|
|
Weighted-average rate
|
—
|
|
|
4.4
|
%
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5.6
|
%
|
|
5.0
|
%
|
|
|
Notional Amount
|
|
|
|
Weighted-Average Fixed Rate
|
|
Fair Value
|
|||||||||||||
June 30, 2019
|
|
December 31, 2018
|
|
Period of Hedge
|
|
|
June 30, 2019
|
|
December 31, 2018
|
||||||||||
(Thousands of Dollars)
|
|
|
|
|
|
(Thousands of Dollars)
|
|||||||||||||
$
|
250,000
|
|
|
$
|
250,000
|
|
|
09/2020 - 09/2030
|
|
2.8
|
%
|
|
$
|
(16,716
|
)
|
|
$
|
(124
|
)
|
|
|
Item 4.
|
Controls and Procedures
|
(a)
|
Evaluation of disclosure controls and procedures.
|
(b)
|
Changes in internal control over financial reporting.
|
Item 6.
|
Exhibits
|
By:
|
|
/s/ Bradley C. Barron
|
|
|
Bradley C. Barron
|
|
|
President and Chief Executive Officer
|
|
|
August 9, 2019
|
|
|
|
By:
|
|
/s/ Thomas R. Shoaf
|
|
|
Thomas R. Shoaf
|
|
|
Executive Vice President and Chief Financial Officer
|
|
|
August 9, 2019
|
|
|
|
By:
|
|
/s/ Jorge A. del Alamo
|
|
|
Jorge A. del Alamo
|
|
|
Senior Vice President and Controller
|
|
|
August 9, 2019
|
Name:
|
Thomas R. Shoaf
|
Title:
|
Executive Vice President and Chief Financial Officer
|
Name:
|
Thomas R. Shoaf
|
Title:
|
Executive Vice President and Chief Financial Officer
|
By:
|
NuStar Pipeline Company, LLC,
|
Name:
|
Thomas R. Shoaf
|
Title:
|
Executive Vice President and
|
Name:
|
Michael Maguire
|
Title:
|
Executive Director
|
Name:
|
Todd Vaubel
|
Title:
|
Director
|
Subsidiary
|
Jurisdiction of Organization
|
Restricted/
Unrestricted/Material
|
Ownership Percentage
|
Bicen Development Corporation N.V.
|
Netherlands
|
Restricted
|
100%
|
Cooperatie NuStar Holdings U.A.
|
Netherlands
|
Restricted
|
100%
|
LegacyStar Services, LLC
|
Delaware
|
Restricted
|
100%
|
NS Security Services, LLC
|
Delaware
|
Restricted
|
100%
|
NuStar Caribe Terminals, Inc.
|
Delaware
|
Restricted
|
100%
|
NuStar Energy Services, Inc.
|
Delaware
|
Restricted
|
100%
|
NuStar Finance LLC
|
Delaware
|
Restricted
|
100%
|
NuStar GP Holdings, LLC
|
Delaware
|
Restricted
|
100%
|
NuStar GP, Inc.
|
Delaware
|
Restricted
|
100%
|
NuStar GP, LLC
|
Delaware
|
Restricted
|
100%
|
NuStar Holdings B.V.
|
Netherlands
|
Restricted
|
100%
|
NuStar Internacional, S de R.L. de C.V.
|
Mexico
|
Restricted
|
100%
|
NuStar Logistics, L.P.
|
Delaware
|
Restricted - Material
|
100%
|
NuStar Permian Crude Logistics, LLC
|
Delaware
|
Restricted
|
100%
|
NuStar Permian Holdings, LLC
|
Delaware
|
Restricted
|
100%
|
NuStar Permian Transportation and Storage, LLC
|
Delaware
|
Restricted - Material
|
100%
|
NuStar Pipeline Company, LLC
|
Delaware
|
Restricted
|
100%
|
NuStar Pipeline Holding Company, LLC
|
Delaware
|
Restricted
|
100%
|
NuStar Pipeline Operating Partnership L.P.
|
Delaware
|
Restricted - Material
|
100%
|
NuStar Pipeline Partners L.P.
|
Delaware
|
Restricted
|
100%
|
NuStar Services Company LLC
|
Delaware
|
Restricted
|
100%
|
NuStar Supply & Trading LLC
|
Delaware
|
Restricted
|
100%
|
NuStar Terminals Canada Co.
|
Canada
|
Restricted
|
100%
|
NuStar Terminals Canada Holdings Co.
|
Canada
|
Restricted
|
100%
|
NuStar Terminals Canada Partnership
|
Canada
|
Restricted
|
100%
|
NuStar Terminals Corporation N.V.
|
Curacao
|
Restricted
|
100%
|
NuStar Terminals Delaware, Inc.
|
Delaware
|
Restricted
|
100%
|
NuStar Terminals International N.V.
|
Curacao
|
Restricted
|
100%
|
NuStar Terminals Marine Services N.V.
|
Netherlands
|
Restricted
|
100%
|
NuStar Terminals New Jersey, Inc.
|
Delaware
|
Restricted
|
100%
|
NuStar Terminals N.V.
|
Netherlands
|
Restricted - Material
|
100%
|
NuStar Terminals Operations Partnership L.P.
|
Delaware
|
Restricted
|
100%
|
NuStar Terminals Partners TX L.P.
|
Delaware
|
Restricted
|
100%
|
NuStar Terminals Services, Inc.
|
Delaware
|
Restricted
|
100%
|
NuStar Terminals Texas, Inc.
|
Delaware
|
Restricted
|
100%
|
NuStar Texas Holdings, Inc.
|
Delaware
|
Restricted
|
100%
|
Point Tupper Marine Services Co.
|
Canada
|
Restricted
|
100%
|
Riverwalk Logistics, L.P.
|
Delaware
|
Restricted
|
100%
|
Saba Company N.V.
|
Netherlands
|
Restricted
|
100%
|
Seven Seas Steamship Company (Sint Eustatius) N.V.
|
Netherlands
|
Restricted
|
100%
|
Shore Terminals LLC
|
Delaware
|
Restricted
|
100%
|
ST Linden Terminal, LLC
|
Delaware
|
Restricted
|
100%
|
Star Creek Ranch, LLC
|
Delaware
|
Restricted
|
100%
|
1.
|
Grant of Performance Units. The Compensation Committee (the “Committee”) of the Board of Directors of NuStar GP, LLC (the “Company”) hereby grants, pursuant to Section 6.3 of the Plan, to Participant the number of Performance Units under the Plan communicated to the Participant by the Participant’s manager, which represents the target number of Performance Units subject to this Agreement, which grant is subject to the terms and conditions of this Agreement and the Plan. A “Performance Unit” is an unfunded, unsecured contractual right (commonly referred to as a “phantom unit”) which, upon vesting, entitles Participant to receive a Unit of the Partnership. No DERs are granted in connection with this Award of Performance Units.
|
2.
|
Performance Period. Except as provided below with respect to a Change of Control and as the Committee may provide with respect to TUR (as defined in Section 4A), the performance period for any Performance Units eligible to vest on any given Vesting Date (as defined below) shall be the calendar year ending on the December 31 immediately preceding such Vesting Date (each, a “Performance Period” and specifically, with respect to each of 2019, 2020 and 2021, the “Year 1 Performance Period,” the “Year 2 Performance Period,” and the “Year 3 Performance Period,” respectively).
|
3.
|
Vesting and Settlement.
|
A.
|
Vesting. Except as otherwise provided in this Agreement, the Performance Units granted hereunder shall be eligible to vest, subject to Section 4, over a period of three years in equal, one-third increments (provided, however, that if such increments would otherwise result in a fractional Performance Unit with respect to the applicable Annual Tranche, such fractional Performance Unit shall be rounded to the nearest whole number) (each increment, an “Annual Tranche” and specifically, with respect to the applicable Performance Period for each of the periods ending on December 31, 2019, 2020 and 2021, the “Year 1 Annual Tranche,” the “Year 2 Annual Tranche,” and the “Year 3 Annual Tranche,” respectively). Except as otherwise provided in this Agreement, the applicable portion, if any, of each Annual Tranche shall vest on the date that the Committee certifies the attainment of the Performance Goals established by Committee (“Performance Measures”) for the applicable Performance Period in accordance with Section 4 following completion of the applicable Performance Period (each of these three vesting dates is referred to as a “Vesting Date”). Except as provided below in Section 3C, Performance Units subject to an Annual Tranche that do not vest as of the Vesting Date for such Annual Tranche shall be automatically and immediately forfeited for no consideration. In no event shall a number of Performance Units greater than 200% of the number of Performance Units subject to this Agreement vest under any circumstances.
|
B.
|
Settlement. Except as provided otherwise in Section 6, any Performance Units that vest pursuant to this Agreement shall be settled as soon as reasonably practical after the applicable Vesting Date and in all events no later than March 15 of the calendar year following the end of the applicable Performance Period. This Agreement and the Award evidenced hereby are intended to comply with or otherwise be exempt from, and shall be administered consistently in all respects with, Section 409A of the Code and the regulations promulgated thereunder and each payment hereunder shall be considered a separate payment under Section 409A of the Code. If necessary in order to attempt to ensure such compliance, this Agreement may be reformed, to the extent possible, unilaterally by the Partnership consistent with guidance issued by the Internal Revenue Service. Participant agrees that the Units to which Participant will be entitled in connection with the vesting, if any, of each Performance Unit may be in uncertificated form and recorded with the Partnership’s or its Affiliates’ service provider.
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C.
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Additional Vesting Opportunity for Carried Forward Units. With respect to each Annual Tranche, any Performance Units that do not vest on the original Vesting Date for such Annual Tranche and that would otherwise be forfeited pursuant to Section 3A (the “Carried Forward Units”) shall not be forfeited pursuant to Section 3A and shall again be eligible to vest on the Vesting Date for the immediately following Performance Period. The portion of the Carried Forward Units that vest, if at all, shall be based on the attainment of the Performance Measures for such immediately following Performance Period; provided, however, that regardless of the level of Performance Measures achieved for the immediately following Performance Period, no more than 100% of the Carried Forward Units shall be eligible to vest. Any Carried Forward Units that do not vest on the Vesting Date for the immediately following Performance Period shall be automatically and immediately forfeited for no consideration.
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4.
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Performance Measures.
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A.
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Performance Unit Vesting for the Year 1 Performance Period. The number of Performance Units in the Year 1 Annual Tranche that will vest on the applicable Vesting Date shall be determined by multiplying (1) the average of the DCR Vesting Percentage for the Year 1 Annual Tranche and the TUR Vesting Percentage for the Year 1 Annual Tranche (each, as defined below) by (2) the number of Performance Units in the Year 1 Annual Tranche.
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I.
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DCR Vesting Percentage for the Year 1 Annual Tranche. The DCR Vesting Percentage for the Year 1 Annual Tranche shall be based on the distribution coverage ratio (“DCR”) achieved by the Partnership during the Year 1 Performance Period as follows:
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II.
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TUR Vesting Percentage for the Year 1 Annual Tranche. The TUR Vesting Percentage for the Year 1 Annual Tranche shall be based on the Partnership’s total unitholder return (“TUR”) relative to the TURs of the peer group of companies set forth on Appendix B (the “Target Group”) during the period beginning on July 31, 2018 and ending on December 31, 2019 (“Year 1 TUR Period”).
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a.
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Total Unitholder Return (TUR). The TUR for each company in the Target Group (including the Partnership) is measured by dividing the sum of (i) the cash distributions on the common shares or common units of such company during the Year 1 TUR Period, assuming cash distribution reinvestment and (ii) the difference between the price of a common share or common unit of such company at the end and at the beginning of the Year 1 TUR Period (appropriately adjusted for any share or unit dividend, share or unit split, spin-off, merger or other similar corporate events) by (iii) the price of a common share or common unit of such company at the beginning of the Year 1 TUR Period.
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b.
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Performance Ranking. The TUR for the Year 1 TUR Period for the Partnership and each company in the Target Group shall be arranged by rank from best to worst according to the TUR achieved by each company. The total number of companies so ranked shall then be divided into four groups (“Quartiles” and each a “Quartile”). For purposes of assigning companies to Quartiles (with the 1st Quartile being the best and the 4th Quartile being the worst), the total number of companies ranked (including the Partnership) shall be divided into four groups as nearly equal in number as possible. The number of companies in each group shall be the total number contained in the Target Group divided by four. If the total number of companies is not evenly divisible by four, so that there is a fraction contained in such quotient, the extra company(ies) represented by such fraction will be included in one or more Quartiles as follows:
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c.
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Vesting Percentage. The TUR Vesting Percentage for the Year 1 Annual Tranche shall be determined based on where the Partnership’s TUR during the Year 1 TUR Period falls within the following ranges:
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Partnership TUR Position
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TUR Vesting Percentage for
Year 1 Annual Tranche
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4th Quartile
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0%
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3rd Quartile
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50%
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2nd Quartile
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100%
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1st Quartile
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150%
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If the Partnership’s TUR is the highest achieved in the 1st Quartile
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200%
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B.
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Performance Unit Vesting for the Year 2 and Year 3 Performance Periods. The Committee will designate the Performance Measures that will apply for the Year 2 Performance Period and the Year 3 Performance Period (the “Year 2 Performance Measures” and the “Year 3 Performance Measures,” respectively) during the applicable year. Within the Committee’s discretion, the Year 2 Performance Measures and the Year 3 Performance Measures may result in the vesting of greater than 100% (up to 200%) of the Year 2 Annual Tranche and the Year 3 Annual Tranche, respectively. The Year 2 Performance Measures and the Year 3 Performance Measures shall be applied to the Year 2 Annual Tranche and the Year 3 Annual Tranche, respectively, to determine the Performance Units that vest with respect to the applicable Performance Period. Notwithstanding the foregoing, the Committee has full discretion to vest between 0% and 200% of the applicable Annual Tranche, regardless of the level of Performance Measures achieved for the applicable year.
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5.
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Termination of Employment.
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A.
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Voluntary Termination and Termination for Cause. Except for a Change of Control, if Participant’s employment is voluntarily terminated by Participant (other than through Participant’s death), or is terminated by the Company, the Partnership or any of their respective Affiliates for Cause, any Annual Tranche for a Performance Period not completed as of the date of termination shall be automatically forfeited for no consideration; provided, however, that a Participant who remains continuously employed with the Company, the Partnership or any of their respective Affiliates from the Grant Date through the last day of a Performance Period will be entitled to the Performance Units (i.e., the Performance Units in the Annual Tranche for such completed Performance Period in accordance with Section 4 and any Carried Forward Units from the immediately preceding Performance Period which are eligible to vest with respect to such completed Performance Period), whether or not Participant remains employed by the Company, the Partnership or any of their respective Affiliates until the Vesting Date applicable to the completed Performance Period.
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B.
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Death, Disability and Termination Other Than for Cause. Except for a Change of Control, if Participant experiences a Disability (as defined below) or if Participant’s employment with the Company, the Partnership or any of their respective Affiliates is terminated by the Company, the Partnership or such Affiliate other than for Cause (at a time when Participant is otherwise willing and able to continue providing services) or as a result of Participant’s death (each, a “Triggering Event”), and the then-current Performance Period will be completed in fewer than 30 days after such Triggering Event, the Annual Tranche applicable to the then-current Performance Period (and any Carried Forward Units which are eligible to vest with respect to the then-current Performance Period) shall vest and be settled in accordance with Sections 3 and 4 as if Participant had remained employed through the last day of the Performance Period. Any Performance Units (including any Carried Forward Units) that fail to vest for the then-current Performance Period after the application of the previous sentence, including any Performance Units for any Performance Periods that would otherwise have commenced following the Triggering Date, shall be automatically and immediately forfeited for no consideration. Any Performance Units that vest pursuant to this Section 5B shall be settled as soon as administratively practicable after the Vesting Date for the then-current Performance Period and in all events no later than March 15 of the calendar year following the end of the calendar year in which the applicable Triggering Event occurs. For purposes of this Agreement, “Disabled” or “Disability” means (i) the inability of Participant to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months or (ii) the receipt of income replacements by Participant, by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, for a period of not less than three (3) months under the accident and health plan of the Company, the Partnership or an applicable Affiliate thereof.
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6.
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Change of Control. Upon a Change of Control, with respect to then-outstanding Performance Units, all applicable Performance Measures will be deemed achieved at the maximum levels applicable to such Performance Units and all such Performance Units shall automatically vest in full. Any Performance Units that vest pursuant to this Section 6 shall be settled as soon as administratively practicable after the Change of Control and in all events no later than March 15 of the calendar year following the end of the calendar year in which the Change of Control occurs.
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7.
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Withholding. The Company, the Partnership or an applicable Affiliate will withhold any taxes due from Participant’s grant as the Company, the Partnership or an applicable Affiliate determines is required by law, which, in the sole discretion of the Committee, may include withholding a number of Performance Units or the Units issuable thereunder otherwise payable to Participant.
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8.
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Acceptance and Acknowledgement. Participant hereby accepts and agrees to be bound by all of the terms, provisions, conditions and limitations of the Plan and any subsequent amendment or amendments thereto, as if it had been set forth verbatim in this Award. Participant shall be deemed to have timely accepted this Agreement and the terms hereof if Participant has not explicitly rejected this Agreement in writing to the Partnership within sixty (60) days after the Grant Date. Participant hereby acknowledges receipt of a copy of the Plan, this Agreement and Appendix A. Participant has read and understands the terms and provisions thereof, and accepts the Performance Units subject to all of the terms and conditions of the Plan and this Agreement. Participant acknowledges that there may be adverse tax consequences upon the vesting or settlement of the Performance Units or disposition of the underlying Units and that Participant has been advised to consult a tax advisor prior to such vesting, settlement or disposition.
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9.
|
Plan and Appendix Incorporated by Reference. The Plan and Appendix A are incorporated into this Agreement by this reference and are made a part hereof for all purposes; provided, however, that, in the event of a conflict between the Plan and this Agreement or between the Plan and Appendix A, the Plan shall control.
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10.
|
Restrictions. This Agreement and Participant’s interest in the Performance Units granted by this Agreement are of a personal nature and, except as expressly provided in this Agreement or the Plan, Participant’s rights with respect thereto may not be sold, mortgaged, pledged, assigned, alienated, transferred, conveyed or otherwise disposed of or encumbered in any manner by Participant. Any such attempted sale, mortgage, pledge, assignment, alienation, transfer, conveyance, disposition or encumbrance shall be void, and the Partnership and its Affiliates shall not be bound thereby.
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1.
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No Guarantee of Tax Consequences. None of the Board, the Company, the Partnership or any Affiliate of any of the foregoing makes any commitment or guarantee that any federal, state, local or other tax treatment will (or will not) apply or be available to Participant (or to any person claiming through or on behalf of Participant) or assumes any liability or responsibility with respect to taxes and penalties and interest thereon arising hereunder with respect to Participant (or to any person claiming through or on behalf of Participant).
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2.
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Successors and Assigns. The Partnership and its Affiliates may assign any of their respective rights under this Agreement and it shall be binding and inure to the benefit of such successors and assigns. Subject to the restrictions on transfer set forth herein, this Agreement will be binding upon Participant and Participant’s beneficiaries, executors, administrators and the person(s) to whom the Performance Units may be transferred by will or the laws of descent or distribution.
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3.
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Governing Law. The validity, construction and effect of this Agreement shall be determined by the laws of the State of Delaware without regard to conflict of laws principles.
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4.
|
No Rights as Unitholder. Neither Participant nor any person claiming by, through or under Participant with respect to the Performance Units shall have any rights as a unitholder of the Partnership (including, without limitation, voting rights) unless and until the Performance Units vest and are settled by the issuance of Units.
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5.
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Amendment. The Committee has the right to amend or alter this Agreement and/or the Performance Units; provided, that no such amendment shall adversely affect Participant’s material rights under this Agreement without Participant’s consent.
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6.
|
No Right to Continued Service. Neither the Plan nor this Agreement shall confer upon Participant any right to be retained in any position, as an Employee, Consultant or Director of the Company, the Partnership or any Affiliate thereof. Further, nothing in the Plan or this Agreement shall be construed to limit the discretion of the Company, the Partnership or any Affiliate thereof to terminate Participant’s service at any time, with or without Cause.
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7.
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Notices. Any notice required to be delivered to the Partnership under this Agreement shall be in writing and addressed to the Secretary of the Company at the Company’s principal offices. Any notice required to be delivered to Participant under this Agreement shall be in writing and addressed to Participant at Participant’s address as then shown in the records of the Company, the Partnership or the applicable Affiliate. Any party hereto may designate another address in writing (or by such other method approved by the Partnership) from time to time.
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8.
|
Interpretation. Any dispute regarding the interpretation of this Agreement shall be submitted by such party to the Committee for review. The resolution of such dispute by the Committee shall be final and binding on the parties hereto.
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9.
|
Severability. The invalidity or unenforceability of any provision of the Plan or this Agreement shall not affect the validity or enforceability of any other provision of the Plan or this Agreement, and each provision of the Plan and this Agreement shall be severable and enforceable to the extent permitted by law.
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Buckeye Partners, L.P.
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Crestwood Equity Partners LP
|
DCP Midstream, LP
|
Enable Midstream Partners, L.P.
|
Energy Transfer LP
|
EnLink Midstream Partners, LP
|
Enterprise Products Partners, LP
|
Genesis Energy, L.P.
|
Magellan Midstream Partners, L.P.
|
MPLX LP
|
NuStar Energy L.P.
|
ONEOK, Inc
|
Plains All American Pipeline, L.P.
|
SEMGroup Corporation
|
Targa Resources Corp.
|
|
/s/ Bradley C. Barron
|
Bradley C. Barron
|
President and Chief Executive Officer
|
/s/ Thomas R. Shoaf
|
Thomas R. Shoaf
|
Executive Vice President and Chief Financial Officer
|
1.
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Partnership.
|
/s/ Bradley C. Barron
|
Bradley C. Barron
|
President and Chief Executive Officer
|
August 9, 2019
|
1.
|
The Report fully complies with the requirements of Section 13(a) or 15(d) 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 Partnership.
|
/s/ Thomas R. Shoaf
|
Thomas R. Shoaf
|
Executive Vice President and Chief Financial Officer
|
August 9, 2019
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