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☒
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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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Delaware
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73-1493906
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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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Large accelerated filer
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ý
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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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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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7.375% Series C Fixed-to-Floating Rate Cumulative Redeemable Perpetual Preferred Units
|
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ETPprC
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New York Stock Exchange
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7.625% Series D Fixed-to-Floating Rate Cumulative Redeemable Perpetual Preferred Units
|
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ETPprD
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New York Stock Exchange
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7.600% Series E Fixed-to-Floating Rate Cumulative Redeemable Perpetual Preferred Units
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ETPprE
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New York Stock Exchange
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7.500% Senior Notes due 2020
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ETP 20
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New York Stock Exchange
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4.250% Senior Notes due 2023
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ETP 23
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New York Stock Exchange
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5.875% Senior Notes due 2024
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ETP 24
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New York Stock Exchange
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5.500% Senior Notes due 2027
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ETP 27
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New York Stock Exchange
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/d
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per day
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AOCI
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accumulated other comprehensive income (loss)
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BBtu
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billion British thermal units
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Btu
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British thermal unit, an energy measurement used by gas companies to convert the volume of gas used to its heat equivalent, and thus calculate the actual energy used
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CDM
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CDM Resource Management LLC and CDM Environmental & Technical Services LLC, collectively
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Citrus
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Citrus, LLC, which owns 100% of FGT
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DOJ
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United States Department of Justice
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EPA
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United States Environmental Protection Agency
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ET
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Energy Transfer LP, a publicly traded partnership and the owner of ETP LLC
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ETC Sunoco
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ETC Sunoco Holdings LLC (formerly Sunoco, Inc.)
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ETP GP
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Energy Transfer Partners GP, L.P., the general partner of ETO
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ETP LLC
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Energy Transfer Partners, L.L.C., the general partner of ETP GP
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Exchange Act
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Securities Exchange Act of 1934
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FEP
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Fayetteville Express Pipeline LLC
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FERC
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Federal Energy Regulatory Commission
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FGT
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Florida Gas Transmission Company, LLC
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GAAP
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accounting principles generally accepted in the United States of America
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IDRs
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incentive distribution rights
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Lake Charles LNG
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Lake Charles LNG Company, LLC (previously named Trunkline LNG Company, LLC)
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LIBOR
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London Interbank Offered Rate
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MBbls
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thousand barrels
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MEP
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Midcontinent Express Pipeline LLC
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MTBE
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methyl tertiary butyl ether
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NGL
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natural gas liquid, such as propane, butane and natural gasoline
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NYMEX
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New York Mercantile Exchange
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OSHA
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federal Occupational Safety and Health Act
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OTC
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over-the-counter
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Panhandle
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Panhandle Eastern Pipe Line Company, LP and its subsidiaries
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PES
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Philadelphia Energy Solutions Refining and Marketing LLC
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Preferred Unitholders
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Unitholders of the Series A Preferred Units, Series B Preferred Units, Series C Preferred Units, Series D Preferred Units and Series E Preferred Units, collectively
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Regency
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Regency Energy Partners LP
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RIGS
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Regency Intrastate Gas System
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Rover
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Rover Pipeline LLC, a subsidiary of ETO
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SEC
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Securities and Exchange Commission
|
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Series A Preferred Units
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6.250% Series A Fixed-to-Floating Rate Cumulative Redeemable Perpetual Preferred Units
|
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Series B Preferred Units
|
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6.625% Series B Fixed-to-Floating Rate Cumulative Redeemable Perpetual Preferred Units
|
|
|
|
|
|
Series C Preferred Units
|
|
7.375% Series C Fixed-to-Floating Rate Cumulative Redeemable Perpetual Preferred Units
|
|
|
|
|
|
Series D Preferred Units
|
|
7.625% Series D Fixed-to-Floating Rate Cumulative Redeemable Perpetual Preferred Units
|
|
|
|
|
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Series E Preferred Units
|
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7.600% Series E Fixed-to-Floating Rate Cumulative Redeemable Perpetual Preferred Units
|
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SPLP
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Sunoco Pipeline L.P.
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Sunoco LP
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Sunoco LP (previously named Susser Petroleum Partners, LP)
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Sunoco R&M
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Sunoco (R&M), LLC (formerly Sunoco, Inc. (R&M))
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Transwestern
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Transwestern Pipeline Company, LLC
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Trunkline
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Trunkline Gas Company, LLC, a subsidiary of Panhandle
|
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USAC
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USA Compression Partners, LP
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USAC Preferred Units
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USAC Series A Preferred Units
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June 30, 2019
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|
December 31, 2018
|
||||
ASSETS
|
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|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
444
|
|
|
$
|
418
|
|
Accounts receivable, net
|
4,349
|
|
|
4,009
|
|
||
Accounts receivable from related companies
|
169
|
|
|
176
|
|
||
Inventories
|
1,832
|
|
|
1,677
|
|
||
Income taxes receivable
|
99
|
|
|
73
|
|
||
Derivative assets
|
54
|
|
|
111
|
|
||
Other current assets
|
308
|
|
|
356
|
|
||
Total current assets
|
7,255
|
|
|
6,820
|
|
||
|
|
|
|
||||
Property, plant and equipment
|
81,856
|
|
|
79,280
|
|
||
Accumulated depreciation and depletion
|
(13,970
|
)
|
|
(12,625
|
)
|
||
|
67,886
|
|
|
66,655
|
|
||
|
|
|
|
||||
Advances to and investments in unconsolidated affiliates
|
2,832
|
|
|
2,636
|
|
||
Lease right-of-use assets, net
|
853
|
|
|
—
|
|
||
Other non-current assets, net
|
1,025
|
|
|
1,006
|
|
||
Notes receivable from related company
|
4,416
|
|
|
440
|
|
||
Intangible assets, net
|
5,827
|
|
|
6,000
|
|
||
Goodwill
|
4,883
|
|
|
4,885
|
|
||
Total assets
|
$
|
94,977
|
|
|
$
|
88,442
|
|
|
June 30, 2019
|
|
December 31, 2018
|
||||
LIABILITIES AND EQUITY
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
3,645
|
|
|
$
|
3,491
|
|
Accounts payable to related companies
|
14
|
|
|
119
|
|
||
Derivative liabilities
|
18
|
|
|
185
|
|
||
Operating lease current liabilities
|
59
|
|
|
—
|
|
||
Accrued and other current liabilities
|
2,683
|
|
|
2,847
|
|
||
Current maturities of long-term debt
|
7
|
|
|
2,655
|
|
||
Total current liabilities
|
6,426
|
|
|
9,297
|
|
||
|
|
|
|
||||
Long-term debt, less current maturities
|
46,375
|
|
|
37,853
|
|
||
Non-current derivative liabilities
|
354
|
|
|
104
|
|
||
Non-current operating lease liabilities
|
803
|
|
|
—
|
|
||
Deferred income taxes
|
3,031
|
|
|
2,884
|
|
||
Other non-current liabilities
|
1,140
|
|
|
1,184
|
|
||
|
|
|
|
||||
Commitments and contingencies
|
|
|
|
||||
Redeemable noncontrolling interests
|
500
|
|
|
499
|
|
||
|
|
|
|
||||
Equity:
|
|
|
|
||||
Limited Partners:
|
|
|
|
||||
Preferred Unitholders
|
3,178
|
|
|
2,388
|
|
||
Common Unitholders
|
25,197
|
|
|
26,372
|
|
||
Accumulated other comprehensive loss
|
(33
|
)
|
|
(42
|
)
|
||
Total partners’ capital
|
28,342
|
|
|
28,718
|
|
||
Noncontrolling interests
|
8,006
|
|
|
7,903
|
|
||
Total equity
|
36,348
|
|
|
36,621
|
|
||
Total liabilities and equity
|
$
|
94,977
|
|
|
$
|
88,442
|
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
REVENUES:
|
|
|
|
|
|
|
|
||||||||
Refined product sales
|
$
|
4,477
|
|
|
$
|
4,600
|
|
|
$
|
8,203
|
|
|
$
|
8,203
|
|
Crude sales
|
4,346
|
|
|
4,244
|
|
|
7,871
|
|
|
7,500
|
|
||||
NGL sales
|
1,996
|
|
|
2,356
|
|
|
4,398
|
|
|
4,591
|
|
||||
Gathering, transportation and other fees
|
2,035
|
|
|
1,667
|
|
|
4,302
|
|
|
3,097
|
|
||||
Natural gas sales
|
763
|
|
|
1,024
|
|
|
1,727
|
|
|
2,086
|
|
||||
Other
|
260
|
|
|
227
|
|
|
497
|
|
|
523
|
|
||||
Total revenues
|
13,877
|
|
|
14,118
|
|
|
26,998
|
|
|
26,000
|
|
||||
COSTS AND EXPENSES:
|
|
|
|
|
|
|
|
||||||||
Cost of products sold
|
10,302
|
|
|
11,343
|
|
|
19,717
|
|
|
20,588
|
|
||||
Operating expenses
|
792
|
|
|
772
|
|
|
1,600
|
|
|
1,496
|
|
||||
Depreciation, depletion and amortization
|
781
|
|
|
692
|
|
|
1,552
|
|
|
1,353
|
|
||||
Selling, general and administrative
|
175
|
|
|
173
|
|
|
324
|
|
|
320
|
|
||||
Impairment losses
|
—
|
|
|
—
|
|
|
50
|
|
|
—
|
|
||||
Total costs and expenses
|
12,050
|
|
|
12,980
|
|
|
23,243
|
|
|
23,757
|
|
||||
OPERATING INCOME
|
1,827
|
|
|
1,138
|
|
|
3,755
|
|
|
2,243
|
|
||||
OTHER INCOME (EXPENSE):
|
|
|
|
|
|
|
|
||||||||
Interest expense, net of capitalized interest
|
(578
|
)
|
|
(420
|
)
|
|
(1,105
|
)
|
|
(800
|
)
|
||||
Equity in earnings of unconsolidated affiliates
|
77
|
|
|
92
|
|
|
142
|
|
|
171
|
|
||||
Losses on extinguishments of debt
|
—
|
|
|
—
|
|
|
(2
|
)
|
|
(109
|
)
|
||||
Gains (losses) on interest rate derivatives
|
(122
|
)
|
|
20
|
|
|
(196
|
)
|
|
72
|
|
||||
Other, net
|
112
|
|
|
(1
|
)
|
|
129
|
|
|
56
|
|
||||
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAX EXPENSE
|
1,316
|
|
|
829
|
|
|
2,723
|
|
|
1,633
|
|
||||
Income tax expense from continuing operations
|
35
|
|
|
69
|
|
|
161
|
|
|
59
|
|
||||
INCOME FROM CONTINUING OPERATIONS
|
1,281
|
|
|
760
|
|
|
2,562
|
|
|
1,574
|
|
||||
Loss from discontinued operations, net of income taxes
|
—
|
|
|
(26
|
)
|
|
—
|
|
|
(263
|
)
|
||||
NET INCOME
|
1,281
|
|
|
734
|
|
|
2,562
|
|
|
1,311
|
|
||||
Less: Net income attributable to noncontrolling interests
|
266
|
|
|
170
|
|
|
522
|
|
|
334
|
|
||||
Less: Net income attributable to redeemable noncontrolling interests
|
13
|
|
|
—
|
|
|
26
|
|
|
—
|
|
||||
Less: Net income (loss) attributable to predecessor equity
|
—
|
|
|
132
|
|
|
—
|
|
|
(170
|
)
|
||||
NET INCOME ATTRIBUTABLE TO PARTNERS
|
$
|
1,002
|
|
|
$
|
432
|
|
|
$
|
2,014
|
|
|
$
|
1,147
|
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Net income
|
$
|
1,281
|
|
|
$
|
734
|
|
|
$
|
2,562
|
|
|
$
|
1,311
|
|
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
|
|
||||||||
Change in value of available-for-sale securities
|
3
|
|
|
—
|
|
|
8
|
|
|
(2
|
)
|
||||
Actuarial gain (loss) related to pension and other postretirement benefit plans
|
3
|
|
|
—
|
|
|
10
|
|
|
(2
|
)
|
||||
Change in other comprehensive income from unconsolidated affiliates
|
(5
|
)
|
|
2
|
|
|
(9
|
)
|
|
7
|
|
||||
|
1
|
|
|
2
|
|
|
9
|
|
|
3
|
|
||||
Comprehensive income
|
1,282
|
|
|
736
|
|
|
2,571
|
|
|
1,314
|
|
||||
Less: Comprehensive income attributable to noncontrolling interests
|
266
|
|
|
170
|
|
|
522
|
|
|
334
|
|
||||
Less: Comprehensive income attributable to redeemable noncontrolling interests
|
13
|
|
|
—
|
|
|
26
|
|
|
—
|
|
||||
Less: Comprehensive income (loss) attributable to predecessor equity
|
—
|
|
|
132
|
|
|
—
|
|
|
(170
|
)
|
||||
Comprehensive income attributable to partners
|
$
|
1,003
|
|
|
$
|
434
|
|
|
$
|
2,023
|
|
|
$
|
1,150
|
|
|
Limited Partners
|
|
|
|
|
|
|
||||||||||||
|
Preferred Unitholders
|
|
Common Unitholders
|
|
AOCI
|
|
Non-controlling Interests
|
|
Total
|
||||||||||
Balance, December 31, 2018
|
$
|
2,388
|
|
|
$
|
26,372
|
|
|
$
|
(42
|
)
|
|
$
|
7,903
|
|
|
$
|
36,621
|
|
Distributions to partners
|
(64
|
)
|
|
(1,450
|
)
|
|
—
|
|
|
—
|
|
|
(1,514
|
)
|
|||||
Distributions to noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
(361
|
)
|
|
(361
|
)
|
|||||
Capital contributions from noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
140
|
|
|
140
|
|
|||||
Sale of noncontrolling interest in subsidiary
|
—
|
|
|
—
|
|
|
—
|
|
|
93
|
|
|
93
|
|
|||||
Other comprehensive income, net of tax
|
—
|
|
|
—
|
|
|
8
|
|
|
—
|
|
|
8
|
|
|||||
Other, net
|
—
|
|
|
15
|
|
|
—
|
|
|
13
|
|
|
28
|
|
|||||
Net income, excluding amounts attributable to redeemable noncontrolling interests
|
40
|
|
|
972
|
|
|
—
|
|
|
256
|
|
|
1,268
|
|
|||||
Balance, March 31, 2019
|
2,364
|
|
|
25,909
|
|
|
(34
|
)
|
|
8,044
|
|
|
36,283
|
|
|||||
Distributions to partners
|
(18
|
)
|
|
(1,625
|
)
|
|
—
|
|
|
—
|
|
|
(1,643
|
)
|
|||||
Distributions to noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
(370
|
)
|
|
(370
|
)
|
|||||
Units issued for cash
|
780
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
780
|
|
|||||
Capital contributions from noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
66
|
|
|
66
|
|
|||||
Other comprehensive income, net of tax
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
1
|
|
|||||
Other, net
|
(1
|
)
|
|
(36
|
)
|
|
—
|
|
|
—
|
|
|
(37
|
)
|
|||||
Net income, excluding amounts attributable to redeemable noncontrolling interests
|
53
|
|
|
949
|
|
|
—
|
|
|
266
|
|
|
1,268
|
|
|||||
Balance, June 30, 2019
|
$
|
3,178
|
|
|
$
|
25,197
|
|
|
$
|
(33
|
)
|
|
$
|
8,006
|
|
|
$
|
36,348
|
|
|
Limited Partners
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
Preferred Unitholders
|
|
Common Unitholders
|
|
General Partner
|
|
AOCI
|
|
Non-controlling Interests
|
|
Predecessor Equity
|
|
Total
|
||||||||||||||
Balance, December 31, 2017
|
$
|
1,491
|
|
|
$
|
26,531
|
|
|
$
|
244
|
|
|
$
|
3
|
|
|
$
|
5,882
|
|
|
$
|
2,816
|
|
|
$
|
36,967
|
|
Distributions to partners
|
(24
|
)
|
|
(657
|
)
|
|
(264
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(945
|
)
|
|||||||
Distributions to noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(183
|
)
|
|
(70
|
)
|
|
(253
|
)
|
|||||||
Units issued for cash
|
—
|
|
|
20
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
20
|
|
|||||||
Repurchases of common units
|
—
|
|
|
(24
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(24
|
)
|
|||||||
Subsidiary repurchases of common units
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(300
|
)
|
|
(300
|
)
|
|||||||
Capital contributions from noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
229
|
|
|
—
|
|
|
229
|
|
|||||||
Cumulative effect adjustment due to change in accounting principle
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(54
|
)
|
|
(54
|
)
|
|||||||
Other comprehensive income, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|||||||
Other, net
|
(2
|
)
|
|
(16
|
)
|
|
(17
|
)
|
|
(2
|
)
|
|
(6
|
)
|
|
1
|
|
|
(42
|
)
|
|||||||
Net income (loss)
|
24
|
|
|
289
|
|
|
402
|
|
|
—
|
|
|
164
|
|
|
(302
|
)
|
|
577
|
|
|||||||
Balance, March 31, 2018
|
1,489
|
|
|
26,143
|
|
|
365
|
|
|
2
|
|
|
6,086
|
|
|
2,091
|
|
|
36,176
|
|
|||||||
Distributions to partners
|
—
|
|
|
(658
|
)
|
|
(408
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,066
|
)
|
|||||||
Distributions to noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(176
|
)
|
|
(101
|
)
|
|
(277
|
)
|
|||||||
Units issued for cash
|
436
|
|
|
19
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
455
|
|
|||||||
Capital contributions from noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
89
|
|
|
—
|
|
|
89
|
|
|||||||
Acquisition of USAC
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
832
|
|
|
832
|
|
|||||||
Deemed contribution
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
248
|
|
|
248
|
|
|||||||
Other comprehensive income, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|||||||
Other, net
|
1
|
|
|
42
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
10
|
|
|
55
|
|
|||||||
Net income
|
30
|
|
|
—
|
|
|
402
|
|
|
—
|
|
|
170
|
|
|
132
|
|
|
734
|
|
|||||||
Balance, June 30, 2018
|
$
|
1,956
|
|
|
$
|
25,546
|
|
|
$
|
359
|
|
|
$
|
4
|
|
|
$
|
6,171
|
|
|
$
|
3,212
|
|
|
$
|
37,248
|
|
|
Six Months Ended
June 30, |
||||||
|
2019
|
|
2018
|
||||
OPERATING ACTIVITIES
|
|
|
|
||||
Net income
|
$
|
2,562
|
|
|
$
|
1,311
|
|
Reconciliation of net income to net cash provided by operating activities:
|
|
|
|
||||
Loss from discontinued operations
|
—
|
|
|
263
|
|
||
Depreciation, depletion and amortization
|
1,552
|
|
|
1,353
|
|
||
Deferred income taxes
|
140
|
|
|
72
|
|
||
Inventory valuation adjustments
|
(97
|
)
|
|
(57
|
)
|
||
Non-cash compensation expense
|
58
|
|
|
55
|
|
||
Impairment losses
|
50
|
|
|
—
|
|
||
Losses on extinguishments of debt
|
2
|
|
|
109
|
|
||
Distributions on unvested awards
|
(3
|
)
|
|
(25
|
)
|
||
Equity in earnings of unconsolidated affiliates
|
(142
|
)
|
|
(171
|
)
|
||
Distributions from unconsolidated affiliates
|
170
|
|
|
147
|
|
||
Other non-cash
|
(24
|
)
|
|
(66
|
)
|
||
Net change in operating assets and liabilities, net of effects of acquisitions
|
(248
|
)
|
|
298
|
|
||
Net cash provided by operating activities
|
4,020
|
|
|
3,289
|
|
||
INVESTING ACTIVITIES
|
|
|
|
||||
Cash proceeds from sale of noncontrolling interest in subsidiary
|
93
|
|
|
—
|
|
||
Cash proceeds from USAC acquisition, net of cash received
|
—
|
|
|
711
|
|
||
Cash paid for all other acquisitions, net of cash received
|
(7
|
)
|
|
(143
|
)
|
||
Capital expenditures, excluding allowance for equity funds used during construction
|
(2,818
|
)
|
|
(3,539
|
)
|
||
Contributions in aid of construction costs
|
41
|
|
|
60
|
|
||
Contributions to unconsolidated affiliates
|
(254
|
)
|
|
(13
|
)
|
||
Distributions from unconsolidated affiliates in excess of cumulative earnings
|
21
|
|
|
31
|
|
||
Proceeds from the sale of other assets
|
22
|
|
|
6
|
|
||
Other
|
(40
|
)
|
|
—
|
|
||
Net cash used in investing activities
|
(2,942
|
)
|
|
(2,887
|
)
|
||
FINANCING ACTIVITIES
|
|
|
|
||||
Proceeds from borrowings
|
16,463
|
|
|
16,347
|
|
||
Repayments of debt
|
(14,705
|
)
|
|
(17,452
|
)
|
||
Cash received from/paid to related company
|
180
|
|
|
(85
|
)
|
||
Common units issued for cash
|
—
|
|
|
39
|
|
||
Preferred units issued for cash
|
780
|
|
|
436
|
|
||
Redeemable noncontrolling interests issued for cash
|
—
|
|
|
465
|
|
||
Capital contributions from noncontrolling interests
|
206
|
|
|
318
|
|
||
Distributions to partners
|
(3,157
|
)
|
|
(2,011
|
)
|
||
Predecessor distributions to partners
|
—
|
|
|
(179
|
)
|
||
Distributions to noncontrolling interests
|
(731
|
)
|
|
(359
|
)
|
||
Repurchases of common units
|
—
|
|
|
(24
|
)
|
||
Subsidiary repurchases of common units
|
—
|
|
|
(300
|
)
|
||
Debt issuance costs
|
(87
|
)
|
|
(173
|
)
|
||
Other
|
(1
|
)
|
|
19
|
|
||
Net cash used in financing activities
|
(1,052
|
)
|
|
(2,959
|
)
|
||
DISCONTINUED OPERATIONS
|
|
|
|
||||
Operating activities
|
—
|
|
|
(478
|
)
|
||
Investing activities
|
—
|
|
|
3,207
|
|
||
Changes in cash included in current assets held for sale
|
—
|
|
|
11
|
|
||
Net increase in cash and cash equivalents of discontinued operations
|
—
|
|
|
2,740
|
|
||
Increase in cash and cash equivalents
|
26
|
|
|
183
|
|
||
Cash and cash equivalents, beginning of period
|
418
|
|
|
335
|
|
||
Cash and cash equivalents, end of period
|
$
|
444
|
|
|
$
|
518
|
|
1.
|
ORGANIZATION AND BASIS OF PRESENTATION
|
•
|
the IDRs in ETO were converted into 1,168,205,710 ETO common units;
|
•
|
the general partner interest in ETO was converted to a non-economic general partner interest and ETO issued 18,448,341 ETO common units to ETP GP;
|
•
|
ET contributed its 2,263,158 Sunoco LP common units to ETO in exchange for 2,874,275 ETO common units and 100 percent of the limited liability company interests in Sunoco GP LLC, the sole general partner of Sunoco LP, and all of the IDRs in Sunoco LP, to ETO in exchange for 42,812,389 ETO common units;
|
•
|
ET contributed its 12,466,912 common units representing limited partner interests in USAC and 100 percent of the limited liability company interests in USA Compression GP, LLC, the general partner of USAC, to ETO in exchange for 16,134,903 ETO common units; and
|
•
|
ET contributed its 100 percent limited liability company interest in Lake Charles LNG and a 60 percent limited liability company interest in each of Energy Transfer LNG Export, LLC, ET Crude Oil Terminals, LLC and ETC Illinois LLC (collectively, “Lake Charles LNG and Other”) to ETO in exchange for 37,557,815 ETO common units.
|
|
Balance at December 31, 2018, as previously reported
|
|
Adjustments due to Topic 842 (Leases)
|
|
Balance at January 1, 2019
|
||||||
Assets:
|
|
|
|
|
|
||||||
Property, plant and equipment, net
|
$
|
66,655
|
|
|
$
|
(1
|
)
|
|
$
|
66,654
|
|
Lease right-of-use assets, net
|
—
|
|
|
889
|
|
|
889
|
|
|||
Liabilities:
|
|
|
|
|
|
||||||
Operating lease current liabilities
|
$
|
—
|
|
|
$
|
71
|
|
|
$
|
71
|
|
Accrued and other current liabilities
|
2,847
|
|
|
(1
|
)
|
|
2,846
|
|
|||
Current maturities of long-term debt
|
2,655
|
|
|
1
|
|
|
2,656
|
|
|||
Long-term debt, less current maturities
|
37,853
|
|
|
6
|
|
|
37,859
|
|
|||
Non-current operating lease liabilities
|
—
|
|
|
823
|
|
|
823
|
|
|||
Other non-current liabilities
|
1,184
|
|
|
(12
|
)
|
|
1,172
|
|
2.
|
ACQUISITIONS, DIVESTURES AND RELATED TRANSACTIONS
|
|
Three Months Ended June 30, 2018
|
|
Six Months Ended June 30, 2018
|
||||
REVENUES
|
$
|
—
|
|
|
$
|
349
|
|
|
|
|
|
||||
COSTS AND EXPENSES
|
|
|
|
||||
Cost of products sold
|
—
|
|
|
305
|
|
||
Operating expenses
|
—
|
|
|
61
|
|
||
Selling, general and administrative
|
5
|
|
|
7
|
|
||
Total costs and expenses
|
5
|
|
|
373
|
|
||
OPERATING LOSS
|
(5
|
)
|
|
(24
|
)
|
||
Interest expense, net
|
—
|
|
|
2
|
|
||
Loss on extinguishment of debt and other
|
—
|
|
|
20
|
|
||
Other, net
|
38
|
|
|
61
|
|
||
LOSS FROM DISCONTINUED OPERATIONS BEFORE INCOME TAX EXPENSE (BENEFIT)
|
(43
|
)
|
|
(107
|
)
|
||
Income tax expense (benefit)
|
(17
|
)
|
|
156
|
|
||
LOSS FROM DISCONTINUED OPERATIONS, NET OF INCOME TAXES
|
$
|
(26
|
)
|
|
$
|
(263
|
)
|
3.
|
CASH AND CASH EQUIVALENTS
|
|
Six Months Ended
June 30, |
||||||
|
2019
|
|
2018
|
||||
Accounts receivable
|
$
|
(340
|
)
|
|
$
|
161
|
|
Accounts receivable from related companies
|
7
|
|
|
186
|
|
||
Inventories
|
(57
|
)
|
|
350
|
|
||
Other current assets
|
37
|
|
|
(371
|
)
|
||
Other non-current assets, net
|
(19
|
)
|
|
(16
|
)
|
||
Accounts payable
|
201
|
|
|
(597
|
)
|
||
Accounts payable to related companies
|
(109
|
)
|
|
(136
|
)
|
||
Accrued and other current liabilities
|
(21
|
)
|
|
487
|
|
||
Other non-current liabilities
|
(87
|
)
|
|
1
|
|
||
Derivative assets and liabilities, net
|
140
|
|
|
233
|
|
||
Net change in operating assets and liabilities, net of effects of acquisitions
|
$
|
(248
|
)
|
|
$
|
298
|
|
|
Six Months Ended
June 30, |
||||||
|
2019
|
|
2018
|
||||
NON-CASH INVESTING ACTIVITIES:
|
|
|
|
||||
Accrued capital expenditures
|
$
|
714
|
|
|
$
|
1,015
|
|
Lease assets obtained in exchange for new lease liabilities
|
15
|
|
|
—
|
|
||
Losses from subsidiary common unit transactions
|
—
|
|
|
(127
|
)
|
4.
|
INVENTORIES
|
|
June 30, 2019
|
|
December 31, 2018
|
||||
Natural gas, NGLs and refined products
|
$
|
793
|
|
|
$
|
833
|
|
Crude oil
|
622
|
|
|
506
|
|
||
Spare parts and other
|
417
|
|
|
338
|
|
||
Total inventories
|
$
|
1,832
|
|
|
$
|
1,677
|
|
5.
|
FAIR VALUE MEASURES
|
|
|
|
Fair Value Measurements at
June 30, 2019 |
||||||||
|
Fair Value Total
|
|
Level 1
|
|
Level 2
|
||||||
Assets:
|
|
|
|
|
|
||||||
Commodity derivatives:
|
|
|
|
|
|
||||||
Natural Gas:
|
|
|
|
|
|
||||||
Basis Swaps IFERC/NYMEX
|
$
|
33
|
|
|
$
|
33
|
|
|
$
|
—
|
|
Fixed Swaps/Futures
|
35
|
|
|
35
|
|
|
—
|
|
|||
Forward Physical Contracts
|
7
|
|
|
—
|
|
|
7
|
|
|||
Power:
|
|
|
|
|
|
||||||
Forwards
|
40
|
|
|
—
|
|
|
40
|
|
|||
Futures
|
7
|
|
|
7
|
|
|
—
|
|
|||
NGLs – Forwards/Swaps
|
377
|
|
|
377
|
|
|
—
|
|
|||
Refined Products – Futures
|
1
|
|
|
1
|
|
|
—
|
|
|||
Crude – Forwards/Swaps
|
40
|
|
|
40
|
|
|
—
|
|
|||
Corn - Forwards/Swaps
|
1
|
|
|
1
|
|
|
—
|
|
|||
Total commodity derivatives
|
541
|
|
|
494
|
|
|
47
|
|
|||
Other non-current assets
|
29
|
|
|
19
|
|
|
10
|
|
|||
Total assets
|
$
|
570
|
|
|
$
|
513
|
|
|
$
|
57
|
|
Liabilities:
|
|
|
|
|
|
||||||
Interest rate derivatives
|
$
|
(354
|
)
|
|
$
|
—
|
|
|
$
|
(354
|
)
|
Commodity derivatives:
|
|
|
|
|
|
||||||
Natural Gas:
|
|
|
|
|
|
||||||
Basis Swaps IFERC/NYMEX
|
(42
|
)
|
|
(42
|
)
|
|
—
|
|
|||
Swing Swaps IFERC
|
(2
|
)
|
|
(1
|
)
|
|
(1
|
)
|
|||
Fixed Swaps/Futures
|
(23
|
)
|
|
(23
|
)
|
|
—
|
|
|||
Forward Physical Contracts
|
(3
|
)
|
|
—
|
|
|
(3
|
)
|
|||
Power:
|
|
|
|
|
|
||||||
Forwards
|
(31
|
)
|
|
—
|
|
|
(31
|
)
|
|||
Futures
|
(8
|
)
|
|
(8
|
)
|
|
—
|
|
|||
NGLs – Forwards/Swaps
|
(409
|
)
|
|
(409
|
)
|
|
—
|
|
|||
Refined Products – Futures
|
(4
|
)
|
|
(4
|
)
|
|
—
|
|
|||
Crude – Forwards/Swaps
|
(1
|
)
|
|
(1
|
)
|
|
—
|
|
|||
Total commodity derivatives
|
(523
|
)
|
|
(488
|
)
|
|
(35
|
)
|
|||
Total liabilities
|
$
|
(877
|
)
|
|
$
|
(488
|
)
|
|
$
|
(389
|
)
|
|
|
|
Fair Value Measurements at
December 31, 2018 |
||||||||
|
Fair Value Total
|
|
Level 1
|
|
Level 2
|
||||||
Assets:
|
|
|
|
|
|
||||||
Commodity derivatives:
|
|
|
|
|
|
||||||
Natural Gas:
|
|
|
|
|
|
||||||
Basis Swaps IFERC/NYMEX
|
$
|
42
|
|
|
$
|
42
|
|
|
$
|
—
|
|
Swing Swaps IFERC
|
52
|
|
|
8
|
|
|
44
|
|
|||
Fixed Swaps/Futures
|
97
|
|
|
97
|
|
|
—
|
|
|||
Forward Physical Contracts
|
20
|
|
|
—
|
|
|
20
|
|
|||
Power:
|
|
|
|
|
|
|
|||||
Forwards
|
48
|
|
|
—
|
|
|
48
|
|
|||
Futures
|
1
|
|
|
1
|
|
|
—
|
|
|||
Options – Calls
|
1
|
|
|
1
|
|
|
—
|
|
|||
NGLs – Forwards/Swaps
|
291
|
|
|
291
|
|
|
—
|
|
|||
Refined Products – Futures
|
7
|
|
|
7
|
|
|
—
|
|
|||
Crude – Forwards/Swaps
|
1
|
|
|
1
|
|
|
—
|
|
|||
Total commodity derivatives
|
560
|
|
|
448
|
|
|
112
|
|
|||
Other non-current assets
|
26
|
|
|
17
|
|
|
9
|
|
|||
Total assets
|
$
|
586
|
|
|
$
|
465
|
|
|
$
|
121
|
|
Liabilities:
|
|
|
|
|
|
||||||
Interest rate derivatives
|
$
|
(163
|
)
|
|
$
|
—
|
|
|
$
|
(163
|
)
|
Commodity derivatives:
|
|
|
|
|
|
||||||
Natural Gas:
|
|
|
|
|
|
||||||
Basis Swaps IFERC/NYMEX
|
(91
|
)
|
|
(91
|
)
|
|
—
|
|
|||
Swing Swaps IFERC
|
(40
|
)
|
|
—
|
|
|
(40
|
)
|
|||
Fixed Swaps/Futures
|
(88
|
)
|
|
(88
|
)
|
|
—
|
|
|||
Forward Physical Contracts
|
(21
|
)
|
|
—
|
|
|
(21
|
)
|
|||
Power:
|
|
|
|
|
|
|
|||||
Forwards
|
(42
|
)
|
|
—
|
|
|
(42
|
)
|
|||
Futures
|
(1
|
)
|
|
(1
|
)
|
|
—
|
|
|||
NGLs – Forwards/Swaps
|
(224
|
)
|
|
(224
|
)
|
|
—
|
|
|||
Refined Products – Futures
|
(15
|
)
|
|
(15
|
)
|
|
—
|
|
|||
Crude – Forwards/Swaps
|
(61
|
)
|
|
(61
|
)
|
|
—
|
|
|||
Total commodity derivatives
|
(583
|
)
|
|
(480
|
)
|
|
(103
|
)
|
|||
Total liabilities
|
$
|
(746
|
)
|
|
$
|
(480
|
)
|
|
$
|
(266
|
)
|
6.
|
DEBT OBLIGATIONS
|
7.
|
REDEEMABLE NONCONTROLLING INTERESTS
|
8.
|
EQUITY
|
|
Preferred Unitholders
|
|
|
||||||||||||||||||||
|
Series A
|
|
Series B
|
|
Series C
|
|
Series D
|
|
Series E
|
|
Total
|
||||||||||||
Balance, December 31, 2018
|
$
|
958
|
|
|
$
|
556
|
|
|
$
|
440
|
|
|
$
|
434
|
|
|
$
|
—
|
|
|
$
|
2,388
|
|
Distributions to partners
|
(30
|
)
|
|
(18
|
)
|
|
(8
|
)
|
|
(8
|
)
|
|
—
|
|
|
(64
|
)
|
||||||
Net income
|
15
|
|
|
9
|
|
|
8
|
|
|
8
|
|
|
—
|
|
|
40
|
|
||||||
Balance March 31, 2019
|
943
|
|
|
547
|
|
|
440
|
|
|
434
|
|
|
—
|
|
|
2,364
|
|
||||||
Distributions to partners
|
—
|
|
|
—
|
|
|
(9
|
)
|
|
(9
|
)
|
|
—
|
|
|
(18
|
)
|
||||||
Units issued for cash
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
780
|
|
|
780
|
|
||||||
Other, net
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
(1
|
)
|
||||||
Net income
|
15
|
|
|
9
|
|
|
9
|
|
|
9
|
|
|
11
|
|
|
53
|
|
||||||
Balance, June 30, 2019
|
$
|
958
|
|
|
$
|
556
|
|
|
$
|
440
|
|
|
$
|
434
|
|
|
$
|
790
|
|
|
$
|
3,178
|
|
|
Preferred Unitholders
|
|
|
||||||||||||
|
Series A
|
|
Series B
|
|
Series C
|
|
Total
|
||||||||
Balance, December 31, 2017
|
$
|
944
|
|
|
$
|
547
|
|
|
$
|
—
|
|
|
$
|
1,491
|
|
Distributions to partners
|
(15
|
)
|
|
(9
|
)
|
|
—
|
|
|
(24
|
)
|
||||
Other, net
|
(1
|
)
|
|
(1
|
)
|
|
—
|
|
|
(2
|
)
|
||||
Net income
|
15
|
|
|
9
|
|
|
—
|
|
|
24
|
|
||||
Balance March 31, 2018
|
943
|
|
|
546
|
|
|
—
|
|
|
1,489
|
|
||||
Units issued for cash
|
—
|
|
|
—
|
|
|
436
|
|
|
436
|
|
||||
Other, net
|
—
|
|
|
1
|
|
|
—
|
|
|
1
|
|
||||
Net income
|
15
|
|
|
9
|
|
|
6
|
|
|
30
|
|
||||
Balance, June 30, 2018
|
$
|
958
|
|
|
$
|
556
|
|
|
$
|
442
|
|
|
$
|
1,956
|
|
Period Ended
|
|
Record Date
|
|
Payment Date
|
|
Series A (1)
|
|
Series B (1)
|
|
Series C
|
|
Series D
|
|
Series E (2)
|
||||||||||
December 31, 2018
|
|
February 1, 2019
|
|
February 15, 2019
|
|
$
|
31.25
|
|
|
$
|
33.125
|
|
|
$
|
0.4609
|
|
|
$
|
0.4766
|
|
|
$
|
—
|
|
March 31, 2019
|
|
May 1, 2019
|
|
May 15, 2019
|
|
—
|
|
|
—
|
|
|
0.4609
|
|
|
0.4766
|
|
|
—
|
|
|||||
June 30, 2019
|
|
August 1, 2019
|
|
August 15, 2019
|
|
31.25
|
|
|
33.125
|
|
|
0.4609
|
|
|
0.4766
|
|
|
0.5806
|
|
Quarter Ended
|
|
Record Date
|
|
Payment Date
|
|
Rate
|
||
December 31, 2018
|
|
February 6, 2019
|
|
February 14, 2019
|
|
$
|
0.8255
|
|
March 31, 2019
|
|
May 7, 2019
|
|
May 15, 2019
|
|
0.8255
|
|
|
June 30, 2019
|
|
August 6, 2019
|
|
August 14, 2019
|
|
0.8255
|
|
Quarter Ended
|
|
Record Date
|
|
Payment Date
|
|
Rate
|
||
December 31, 2018
|
|
January 28, 2019
|
|
February 8, 2019
|
|
$
|
0.5250
|
|
March 31, 2019
|
|
April 29, 2019
|
|
May 10, 2019
|
|
0.5250
|
|
|
June 30, 2019
|
|
July 29, 2019
|
|
August 9, 2019
|
|
0.5250
|
|
|
June 30, 2019
|
|
December 31, 2018
|
||||
Available-for-sale securities
|
$
|
10
|
|
|
$
|
2
|
|
Foreign currency translation adjustment
|
(5
|
)
|
|
(5
|
)
|
||
Actuarial loss related to pensions and other postretirement benefits
|
(38
|
)
|
|
(48
|
)
|
||
Investments in unconsolidated affiliates, net
|
—
|
|
|
9
|
|
||
Total AOCI, net of tax
|
$
|
(33
|
)
|
|
$
|
(42
|
)
|
9.
|
INCOME TAXES
|
10.
|
REGULATORY MATTERS, COMMITMENTS, CONTINGENCIES AND ENVIRONMENTAL LIABILITIES
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
ROW expense
|
$
|
6
|
|
|
$
|
7
|
|
|
$
|
12
|
|
|
$
|
13
|
|
•
|
certain of our interstate pipelines conduct soil and groundwater remediation related to contamination from past uses of polychlorinated biphenyls (“PCBs”). PCB assessments are ongoing and, in some cases, our subsidiaries could potentially be held responsible for contamination caused by other parties.
|
•
|
certain gathering and processing systems are responsible for soil and groundwater remediation related to releases of hydrocarbons.
|
•
|
legacy sites related to ETC Sunoco that are subject to environmental assessments, including formerly owned terminals and other logistics assets, retail sites that ETC Sunoco no longer operates, closed and/or sold refineries and other formerly owned sites.
|
•
|
ETC Sunoco is potentially subject to joint and several liability for the costs of remediation at sites at which it has been identified as a potentially responsible party (“PRP”). As of June 30, 2019, ETC Sunoco had been named as a PRP at approximately 38 identified or potentially identifiable “Superfund” sites under federal and/or comparable state law. ETC Sunoco is usually one of a number of companies identified as a PRP at a site. ETC Sunoco has reviewed the nature and extent of its involvement at each site and other relevant circumstances and, based upon ETC Sunoco’s purported nexus to the sites, believes that its potential liability associated with such sites will not be significant.
|
|
June 30, 2019
|
|
December 31, 2018
|
||||
Current
|
$
|
46
|
|
|
$
|
42
|
|
Non-current
|
278
|
|
|
295
|
|
||
Total environmental liabilities
|
$
|
324
|
|
|
$
|
337
|
|
11.
|
REVENUE
|
|
Contract Liabilities
|
||
Balance, December 31, 2018
|
$
|
392
|
|
Additions
|
300
|
|
|
Revenue recognized
|
(315
|
)
|
|
Balance, June 30, 2019
|
$
|
377
|
|
|
|
||
Balance, January 1, 2018
|
$
|
215
|
|
Additions
|
216
|
|
|
Revenue recognized
|
(143
|
)
|
|
Balance, June 30, 2018
|
$
|
288
|
|
|
June 30, 2019
|
|
December 31, 2018
|
||||
Contract asset balances:
|
|
|
|
||||
Contract asset
|
$
|
95
|
|
|
$
|
75
|
|
Accounts receivable from contracts with customers
|
533
|
|
|
348
|
|
|
|
Years Ending December 31,
|
|
|
|
|
||||||||||||||
|
|
2019 (remainder)
|
|
2020
|
|
2021
|
|
Thereafter
|
|
Total
|
||||||||||
Revenue expected to be recognized on contracts with customers existing as of June 30, 2019
|
|
$
|
3,427
|
|
|
$
|
5,091
|
|
|
$
|
4,545
|
|
|
$
|
27,729
|
|
|
$
|
40,792
|
|
12.
|
LEASE ACCOUNTING
|
|
June 30, 2019
|
||
Operating leases:
|
|
||
Lease right-of-use assets, net
|
$
|
849
|
|
Operating lease current liabilities
|
59
|
|
|
Accrued and other current liabilities
|
1
|
|
|
Non-current operating lease liabilities
|
803
|
|
|
Finance leases:
|
|
||
Property, plant and equipment, net
|
$
|
2
|
|
Lease right-of-use assets, net
|
4
|
|
|
Accrued and other current liabilities
|
1
|
|
|
Long-term debt, less current maturities
|
7
|
|
|
Other non-current liabilities
|
2
|
|
|
|
Income Statement Location
|
|
Three Months Ended June 30, 2019
|
|
Six Months Ended June 30, 2019
|
||||
Operating lease costs:
|
|
|
|
|
||||||
Operating lease cost
|
|
Cost of goods sold
|
|
$
|
8
|
|
|
$
|
16
|
|
Operating lease cost
|
|
Operating expenses
|
|
19
|
|
|
36
|
|
||
Operating lease cost
|
|
Selling, general and administrative
|
|
4
|
|
|
7
|
|
||
Total operating lease costs
|
|
31
|
|
|
59
|
|
||||
Finance lease costs:
|
|
|
|
|
||||||
Amortization of lease assets
|
|
Depreciation, depletion and amortization
|
|
1
|
|
|
2
|
|
||
Interest on lease liabilities
|
|
Interest expense, net of capitalized interest
|
|
—
|
|
|
—
|
|
||
Total finance lease costs
|
|
1
|
|
|
2
|
|
||||
Short-term lease cost
|
|
Operating expenses
|
|
12
|
|
|
23
|
|
||
Variable lease cost
|
|
Operating expenses
|
|
5
|
|
|
8
|
|
||
Lease costs, gross
|
|
49
|
|
|
92
|
|
||||
Less: Sublease income
|
|
Other revenue
|
|
12
|
|
|
23
|
|
||
Lease costs, net
|
|
$
|
37
|
|
|
$
|
69
|
|
|
June 30, 2019
|
|
Weighted-average remaining lease term (years):
|
|
|
Operating leases
|
22
|
|
Finance leases
|
10
|
|
Weighted-average discount rate (%):
|
|
|
Operating leases
|
5
|
%
|
Finance leases
|
8
|
%
|
|
Six Months Ended June 30, 2019
|
||
Operating cash flows from operating leases
|
$
|
(79
|
)
|
Lease assets obtained in exchange for new lease liabilities
|
15
|
|
|
Operating Leases
|
|
Finance Leases
|
|
Total
|
||||||
2019 (remainder)
|
$
|
55
|
|
|
$
|
1
|
|
|
$
|
56
|
|
2020
|
93
|
|
|
2
|
|
|
95
|
|
|||
2021
|
84
|
|
|
2
|
|
|
86
|
|
|||
2022
|
71
|
|
|
1
|
|
|
72
|
|
|||
2023
|
67
|
|
|
1
|
|
|
68
|
|
|||
Thereafter
|
1,152
|
|
|
6
|
|
|
1,158
|
|
|||
Total lease payments
|
1,522
|
|
|
13
|
|
|
1,535
|
|
|||
Less: present value discount
|
659
|
|
|
3
|
|
|
662
|
|
|||
Present value of lease liabilities
|
$
|
863
|
|
|
$
|
10
|
|
|
$
|
873
|
|
|
Lease Payments
|
||
2019 (remainder)
|
$
|
46
|
|
2020
|
72
|
|
|
2021
|
59
|
|
|
2022
|
53
|
|
|
2023
|
4
|
|
|
Thereafter
|
5
|
|
|
Total undiscounted cash flows
|
$
|
239
|
|
13.
|
DERIVATIVE ASSETS AND LIABILITIES
|
|
June 30, 2019
|
|
December 31, 2018
|
||||||
|
Notional Volume
|
|
Maturity
|
|
Notional Volume
|
|
Maturity
|
||
Mark-to-Market Derivatives
|
|
|
|
|
|
|
|
||
(Trading)
|
|
|
|
|
|
|
|
||
Natural Gas (BBtu):
|
|
|
|
|
|
|
|
||
Basis Swaps IFERC/NYMEX (1)
|
13,038
|
|
|
2019-2020
|
|
16,845
|
|
|
2019-2020
|
Fixed Swaps/Futures
|
775
|
|
|
2019-2020
|
|
468
|
|
|
2019
|
Options – Puts
|
—
|
|
|
—
|
|
10,000
|
|
|
2019
|
Power (Megawatt):
|
|
|
|
|
|
|
|
||
Forwards
|
2,554,800
|
|
|
2019-2029
|
|
3,141,520
|
|
|
2019
|
Futures
|
1,095,558
|
|
|
2019-2021
|
|
56,656
|
|
|
2019-2021
|
Options – Puts
|
175,200
|
|
|
2019
|
|
18,400
|
|
|
2019
|
Options – Calls
|
317,600
|
|
|
2019-2020
|
|
284,800
|
|
|
2019
|
(Non-Trading)
|
|
|
|
|
|
|
|
||
Natural Gas (BBtu):
|
|
|
|
|
|
|
|
||
Basis Swaps IFERC/NYMEX
|
(23,115
|
)
|
|
2019-2022
|
|
(30,228
|
)
|
|
2019-2021
|
Swing Swaps IFERC
|
8,480
|
|
|
2019-2020
|
|
54,158
|
|
|
2019-2020
|
Fixed Swaps/Futures
|
(3,505
|
)
|
|
2019-2021
|
|
(1,068
|
)
|
|
2019-2021
|
Forward Physical Contracts
|
(22,542
|
)
|
|
2019-2021
|
|
(123,254
|
)
|
|
2019-2020
|
NGLs (MBbls) – Forwards/Swaps
|
(1,612
|
)
|
|
2019-2021
|
|
(2,135
|
)
|
|
2019
|
Refined Products (MBbls) – Futures
|
(126
|
)
|
|
2019-2021
|
|
(1,403
|
)
|
|
2019
|
Crude (MBbls) – Forwards/Swaps
|
18,670
|
|
|
2019-2020
|
|
20,888
|
|
|
2019
|
Corn (thousand bushels)
|
(2,605
|
)
|
|
2019
|
|
(1,920
|
)
|
|
2019
|
Fair Value Hedging Derivatives
|
|
|
|
|
|
|
|
||
(Non-Trading)
|
|
|
|
|
|
|
|
||
Natural Gas (BBtu):
|
|
|
|
|
|
|
|
||
Basis Swaps IFERC/NYMEX
|
(31,703
|
)
|
|
2019-2020
|
|
(17,445
|
)
|
|
2019
|
Fixed Swaps/Futures
|
(31,703
|
)
|
|
2019-2020
|
|
(17,445
|
)
|
|
2019
|
Hedged Item – Inventory
|
31,703
|
|
|
2019-2020
|
|
17,445
|
|
|
2019
|
(1)
|
Includes aggregate amounts for open positions related to Houston Ship Channel, Waha Hub, NGPL TexOk, West Louisiana Zone and Henry Hub locations.
|
Term
|
|
Type(1)
|
|
Notional Amount Outstanding
|
||||||
June 30, 2019
|
|
December 31, 2018
|
||||||||
July 2019(2)
|
|
Forward-starting to pay a fixed rate of 3.56% and receive a floating rate
|
|
$
|
—
|
|
|
$
|
400
|
|
July 2020(2)
|
|
Forward-starting to pay a fixed rate of 3.52% and receive a floating rate
|
|
400
|
|
|
400
|
|
||
July 2021(2)
|
|
Forward-starting to pay a fixed rate of 3.55% and receive a floating rate
|
|
400
|
|
|
400
|
|
||
July 2022(2)
|
|
Forward-starting to pay a fixed rate of 3.80% and receive a floating rate
|
|
400
|
|
|
—
|
|
||
March 2019
|
|
Pay a floating rate and receive a fixed rate of 1.42%
|
|
—
|
|
|
300
|
|
(1)
|
Floating rates are based on 3-month LIBOR.
|
(2)
|
Represents the effective date. These forward-starting swaps have terms of 30 years with a mandatory termination date the same as the effective date.
|
|
|
Fair Value of Derivative Instruments
|
||||||||||||||
|
|
Asset Derivatives
|
|
Liability Derivatives
|
||||||||||||
|
|
June 30, 2019
|
|
December 31, 2018
|
|
June 30, 2019
|
|
December 31, 2018
|
||||||||
Derivatives designated as hedging instruments:
|
|
|
|
|
|
|
|
|
||||||||
Commodity derivatives (margin deposits)
|
|
$
|
14
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(13
|
)
|
Derivatives not designated as hedging instruments:
|
|
|
|
|
|
|
|
|
||||||||
Commodity derivatives (margin deposits)
|
|
406
|
|
|
402
|
|
|
(438
|
)
|
|
(397
|
)
|
||||
Commodity derivatives
|
|
121
|
|
|
158
|
|
|
(85
|
)
|
|
(173
|
)
|
||||
Interest rate derivatives
|
|
—
|
|
|
—
|
|
|
(354
|
)
|
|
(163
|
)
|
||||
|
|
527
|
|
|
560
|
|
|
(877
|
)
|
|
(733
|
)
|
||||
Total derivatives
|
|
$
|
541
|
|
|
$
|
560
|
|
|
$
|
(877
|
)
|
|
$
|
(746
|
)
|
|
Location of Gain Recognized in Income on Derivatives
|
|
Amount of Gain Recognized in Income Representing Hedge Ineffectiveness and Amount Excluded from the Assessment of Effectiveness
|
||||||||||||||
|
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Derivatives in fair value hedging relationships (including hedged item):
|
|
|
|
|
|
|
|
|
|
||||||||
Commodity derivatives
|
Cost of products sold
|
|
$
|
—
|
|
|
$
|
6
|
|
|
$
|
—
|
|
|
$
|
9
|
|
|
Location of Gain (Loss) Recognized in Income on Derivatives
|
|
Amount of Gain (Loss) Recognized in Income on Derivatives
|
||||||||||||||
|
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Derivatives not designated as hedging instruments:
|
|
|
|
|
|
|
|
|
|
||||||||
Commodity derivatives – Trading
|
Cost of products sold
|
|
$
|
(20
|
)
|
|
$
|
16
|
|
|
$
|
(14
|
)
|
|
$
|
33
|
|
Commodity derivatives – Non-trading
|
Cost of products sold
|
|
(29
|
)
|
|
(295
|
)
|
|
(41
|
)
|
|
(366
|
)
|
||||
Interest rate derivatives
|
Gains (losses) on interest rate derivatives
|
|
(122
|
)
|
|
20
|
|
|
(196
|
)
|
|
72
|
|
||||
Total
|
|
|
$
|
(171
|
)
|
|
$
|
(259
|
)
|
|
$
|
(251
|
)
|
|
$
|
(261
|
)
|
14.
|
RELATED PARTY TRANSACTIONS
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Revenues from related companies
|
$
|
136
|
|
|
$
|
120
|
|
|
$
|
245
|
|
|
$
|
222
|
|
|
June 30, 2019
|
|
December 31, 2018
|
||||
Accounts receivable from related companies:
|
|
|
|
||||
ET
|
$
|
57
|
|
|
$
|
65
|
|
FGT
|
32
|
|
|
25
|
|
||
Phillips 66
|
47
|
|
|
42
|
|
||
Other
|
33
|
|
|
44
|
|
||
Total accounts receivable from related companies
|
$
|
169
|
|
|
$
|
176
|
|
|
|
|
|
||||
Accounts payable to related companies:
|
|
|
|
||||
ET
|
$
|
—
|
|
|
$
|
59
|
|
Other
|
14
|
|
|
60
|
|
||
Total accounts payable to related companies
|
$
|
14
|
|
|
$
|
119
|
|
15.
|
REPORTABLE SEGMENTS
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Revenues:
|
|
|
|
|
|
|
|
||||||||
Intrastate transportation and storage:
|
|
|
|
|
|
|
|
||||||||
Revenues from external customers
|
$
|
671
|
|
|
$
|
761
|
|
|
$
|
1,440
|
|
|
$
|
1,578
|
|
Intersegment revenues
|
94
|
|
|
52
|
|
|
181
|
|
|
110
|
|
||||
|
765
|
|
|
813
|
|
|
1,621
|
|
|
1,688
|
|
||||
Interstate transportation and storage:
|
|
|
|
|
|
|
|
||||||||
Revenues from external customers
|
487
|
|
|
373
|
|
|
979
|
|
|
735
|
|
||||
Intersegment revenues
|
6
|
|
|
5
|
|
|
12
|
|
|
8
|
|
||||
|
493
|
|
|
378
|
|
|
991
|
|
|
743
|
|
||||
Midstream:
|
|
|
|
|
|
|
|
||||||||
Revenues from external customers
|
337
|
|
|
594
|
|
|
1,000
|
|
|
1,034
|
|
||||
Intersegment revenues
|
861
|
|
|
1,280
|
|
|
1,916
|
|
|
2,454
|
|
||||
|
1,198
|
|
|
1,874
|
|
|
2,916
|
|
|
3,488
|
|
||||
NGL and refined products transportation and services:
|
|
|
|
|
|
|
|
||||||||
Revenues from external customers
|
2,356
|
|
|
2,359
|
|
|
5,069
|
|
|
4,622
|
|
||||
Intersegment revenues
|
256
|
|
|
209
|
|
|
574
|
|
|
492
|
|
||||
|
2,612
|
|
|
2,568
|
|
|
5,643
|
|
|
5,114
|
|
||||
Crude oil transportation and services:
|
|
|
|
|
|
|
|
||||||||
Revenues from external customers
|
5,012
|
|
|
4,789
|
|
|
9,179
|
|
|
8,520
|
|
||||
Intersegment revenues
|
34
|
|
|
14
|
|
|
53
|
|
|
28
|
|
||||
|
5,046
|
|
|
4,803
|
|
|
9,232
|
|
|
8,548
|
|
||||
Investment in Sunoco LP:
|
|
|
|
|
|
|
|
||||||||
Revenues from external customers
|
4,474
|
|
|
4,606
|
|
|
8,166
|
|
|
8,354
|
|
||||
Intersegment revenues
|
1
|
|
|
1
|
|
|
1
|
|
|
2
|
|
||||
|
4,475
|
|
|
4,607
|
|
|
8,167
|
|
|
8,356
|
|
||||
Investment in USAC:
|
|
|
|
|
|
|
|
||||||||
Revenues from external customers
|
169
|
|
|
165
|
|
|
336
|
|
|
165
|
|
||||
Intersegment revenues
|
5
|
|
|
2
|
|
|
9
|
|
|
2
|
|
||||
|
174
|
|
|
167
|
|
|
345
|
|
|
167
|
|
||||
All other:
|
|
|
|
|
|
|
|
||||||||
Revenues from external customers
|
371
|
|
|
471
|
|
|
829
|
|
|
992
|
|
||||
Intersegment revenues
|
20
|
|
|
31
|
|
|
59
|
|
|
81
|
|
||||
|
391
|
|
|
502
|
|
|
888
|
|
|
1,073
|
|
||||
Eliminations
|
(1,277
|
)
|
|
(1,594
|
)
|
|
(2,805
|
)
|
|
(3,177
|
)
|
||||
Total revenues
|
$
|
13,877
|
|
|
$
|
14,118
|
|
|
$
|
26,998
|
|
|
$
|
26,000
|
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Segment Adjusted EBITDA:
|
|
|
|
|
|
|
|
||||||||
Intrastate transportation and storage
|
$
|
290
|
|
|
$
|
208
|
|
|
$
|
542
|
|
|
$
|
400
|
|
Interstate transportation and storage
|
460
|
|
|
375
|
|
|
916
|
|
|
741
|
|
||||
Midstream
|
412
|
|
|
414
|
|
|
794
|
|
|
791
|
|
||||
NGL and refined products transportation and services
|
644
|
|
|
461
|
|
|
1,256
|
|
|
912
|
|
||||
Crude oil transportation and services
|
751
|
|
|
548
|
|
|
1,557
|
|
|
1,012
|
|
||||
Investment in Sunoco LP
|
152
|
|
|
140
|
|
|
305
|
|
|
249
|
|
||||
Investment in USAC
|
105
|
|
|
95
|
|
|
206
|
|
|
95
|
|
||||
All other
|
13
|
|
|
30
|
|
|
46
|
|
|
75
|
|
||||
Total
|
2,827
|
|
|
2,271
|
|
|
5,622
|
|
|
4,275
|
|
||||
Depreciation, depletion and amortization
|
(781
|
)
|
|
(692
|
)
|
|
(1,552
|
)
|
|
(1,353
|
)
|
||||
Interest expense, net of capitalized interest
|
(578
|
)
|
|
(420
|
)
|
|
(1,105
|
)
|
|
(800
|
)
|
||||
Impairment losses
|
—
|
|
|
—
|
|
|
(50
|
)
|
|
—
|
|
||||
Gains (losses) on interest rate derivatives
|
(122
|
)
|
|
20
|
|
|
(196
|
)
|
|
72
|
|
||||
Non-cash compensation expense
|
(29
|
)
|
|
(32
|
)
|
|
(58
|
)
|
|
(55
|
)
|
||||
Unrealized gains (losses) on commodity risk management activities
|
(23
|
)
|
|
(265
|
)
|
|
26
|
|
|
(352
|
)
|
||||
Losses on extinguishments of debt
|
—
|
|
|
—
|
|
|
(2
|
)
|
|
(109
|
)
|
||||
Inventory valuation adjustments
|
4
|
|
|
32
|
|
|
97
|
|
|
57
|
|
||||
Adjusted EBITDA related to unconsolidated affiliates
|
(163
|
)
|
|
(168
|
)
|
|
(309
|
)
|
|
(324
|
)
|
||||
Equity in earnings of unconsolidated affiliates
|
77
|
|
|
92
|
|
|
142
|
|
|
171
|
|
||||
Adjusted EBITDA related to discontinued operations
|
—
|
|
|
5
|
|
|
—
|
|
|
25
|
|
||||
Other, net
|
104
|
|
|
(14
|
)
|
|
108
|
|
|
26
|
|
||||
Income from continuing operations before income tax expense
|
1,316
|
|
|
829
|
|
|
2,723
|
|
|
1,633
|
|
||||
Income tax expense from continuing operations
|
(35
|
)
|
|
(69
|
)
|
|
(161
|
)
|
|
(59
|
)
|
||||
Income from continuing operations
|
1,281
|
|
|
760
|
|
|
2,562
|
|
|
1,574
|
|
||||
Loss from discontinued operations, net of income taxes
|
—
|
|
|
(26
|
)
|
|
—
|
|
|
(263
|
)
|
||||
Net income
|
$
|
1,281
|
|
|
$
|
734
|
|
|
$
|
2,562
|
|
|
$
|
1,311
|
|
|
June 30, 2019
|
|
December 31, 2018
|
||||
Assets:
|
|
|
|
||||
Intrastate transportation and storage
|
$
|
6,159
|
|
|
$
|
6,365
|
|
Interstate transportation and storage
|
15,606
|
|
|
15,081
|
|
||
Midstream
|
19,866
|
|
|
19,745
|
|
||
NGL and refined products transportation and services
|
19,409
|
|
|
18,267
|
|
||
Crude oil transportation and services
|
18,790
|
|
|
18,022
|
|
||
Investment in Sunoco LP
|
5,470
|
|
|
4,879
|
|
||
Investment in USAC
|
3,760
|
|
|
3,775
|
|
||
All other and eliminations
|
5,917
|
|
|
2,308
|
|
||
Total assets
|
$
|
94,977
|
|
|
$
|
88,442
|
|
16.
|
CONSOLIDATING GUARANTOR FINANCIAL INFORMATION
|
|
June 30, 2019
|
||||||||||||||||||
|
Parent Guarantor
|
|
Subsidiary Issuer
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated Partnership
|
||||||||||
Cash and cash equivalents
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
444
|
|
|
$
|
—
|
|
|
$
|
444
|
|
All other current assets
|
7
|
|
|
58
|
|
|
7,438
|
|
|
(692
|
)
|
|
6,811
|
|
|||||
Property, plant and equipment, net
|
—
|
|
|
—
|
|
|
67,886
|
|
|
—
|
|
|
67,886
|
|
|||||
Investments in unconsolidated affiliates
|
53,284
|
|
|
14,261
|
|
|
2,832
|
|
|
(67,545
|
)
|
|
2,832
|
|
|||||
All other assets
|
4,426
|
|
|
75
|
|
|
12,503
|
|
|
—
|
|
|
17,004
|
|
|||||
Total assets
|
$
|
57,717
|
|
|
$
|
14,394
|
|
|
$
|
91,103
|
|
|
$
|
(68,237
|
)
|
|
$
|
94,977
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Current liabilities
|
$
|
(547
|
)
|
|
$
|
(3,129
|
)
|
|
$
|
11,337
|
|
|
$
|
(1,235
|
)
|
|
$
|
6,426
|
|
Non-current liabilities
|
31,009
|
|
|
7,603
|
|
|
13,591
|
|
|
—
|
|
|
52,203
|
|
|||||
Noncontrolling interests
|
—
|
|
|
—
|
|
|
8,006
|
|
|
—
|
|
|
8,006
|
|
|||||
Total partners’ capital
|
27,255
|
|
|
9,920
|
|
|
58,169
|
|
|
(67,002
|
)
|
|
28,342
|
|
|||||
Total liabilities and equity
|
$
|
57,717
|
|
|
$
|
14,394
|
|
|
$
|
91,103
|
|
|
$
|
(68,237
|
)
|
|
$
|
94,977
|
|
|
December 31, 2018
|
||||||||||||||||||
|
Parent Guarantor
|
|
Subsidiary Issuer
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated Partnership
|
||||||||||
Cash and cash equivalents
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
418
|
|
|
$
|
—
|
|
|
$
|
418
|
|
All other current assets
|
5
|
|
|
57
|
|
|
7,074
|
|
|
(734
|
)
|
|
6,402
|
|
|||||
Property, plant and equipment, net
|
—
|
|
|
—
|
|
|
66,655
|
|
|
—
|
|
|
66,655
|
|
|||||
Investments in unconsolidated affiliates
|
51,876
|
|
|
13,090
|
|
|
2,636
|
|
|
(64,966
|
)
|
|
2,636
|
|
|||||
All other assets
|
12
|
|
|
75
|
|
|
12,244
|
|
|
—
|
|
|
12,331
|
|
|||||
Total assets
|
$
|
51,893
|
|
|
$
|
13,222
|
|
|
$
|
89,027
|
|
|
$
|
(65,700
|
)
|
|
$
|
88,442
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Current liabilities
|
$
|
(635
|
)
|
|
$
|
(3,315
|
)
|
|
$
|
14,469
|
|
|
$
|
(1,222
|
)
|
|
$
|
9,297
|
|
Non-current liabilities
|
24,787
|
|
|
7,605
|
|
|
10,132
|
|
|
—
|
|
|
42,524
|
|
|||||
Noncontrolling interests
|
—
|
|
|
—
|
|
|
7,903
|
|
|
—
|
|
|
7,903
|
|
|||||
Total partners’ capital
|
27,741
|
|
|
8,932
|
|
|
56,523
|
|
|
(64,478
|
)
|
|
28,718
|
|
|||||
Total liabilities and equity
|
$
|
51,893
|
|
|
$
|
13,222
|
|
|
$
|
89,027
|
|
|
$
|
(65,700
|
)
|
|
$
|
88,442
|
|
|
Three Months Ended June 30, 2019
|
||||||||||||||||||
|
Parent Guarantor
|
|
Subsidiary Issuer
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated Partnership
|
||||||||||
Revenues
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
13,877
|
|
|
$
|
—
|
|
|
$
|
13,877
|
|
Operating costs, expenses, and other
|
—
|
|
|
—
|
|
|
12,050
|
|
|
—
|
|
|
12,050
|
|
|||||
Operating income
|
—
|
|
|
—
|
|
|
1,827
|
|
|
—
|
|
|
1,827
|
|
|||||
Interest expense, net of capitalized interest
|
(416
|
)
|
|
(63
|
)
|
|
(99
|
)
|
|
—
|
|
|
(578
|
)
|
|||||
Equity in earnings of unconsolidated affiliates
|
1,422
|
|
|
508
|
|
|
77
|
|
|
(1,930
|
)
|
|
77
|
|
|||||
Gains on interest rate derivatives
|
(122
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(122
|
)
|
|||||
Other, net
|
119
|
|
|
—
|
|
|
(7
|
)
|
|
—
|
|
|
112
|
|
|||||
Income before income tax expense
|
1,003
|
|
|
445
|
|
|
1,798
|
|
|
(1,930
|
)
|
|
1,316
|
|
|||||
Income tax expense
|
—
|
|
|
—
|
|
|
35
|
|
|
—
|
|
|
35
|
|
|||||
Net income
|
1,003
|
|
|
445
|
|
|
1,763
|
|
|
(1,930
|
)
|
|
1,281
|
|
|||||
Less: Net income attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
266
|
|
|
—
|
|
|
266
|
|
|||||
Less: Net income attributable to redeemable noncontrolling interests
|
—
|
|
|
—
|
|
|
13
|
|
|
—
|
|
|
13
|
|
|||||
Net income attributable to partners
|
$
|
1,003
|
|
|
$
|
445
|
|
|
$
|
1,484
|
|
|
$
|
(1,930
|
)
|
|
$
|
1,002
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Other comprehensive income
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
1
|
|
Comprehensive income
|
1,003
|
|
|
445
|
|
|
1,764
|
|
|
(1,930
|
)
|
|
1,282
|
|
|||||
Less: Comprehensive income attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
266
|
|
|
—
|
|
|
266
|
|
|||||
Less: Comprehensive income attributable to redeemable noncontrolling interests
|
—
|
|
|
—
|
|
|
13
|
|
|
—
|
|
|
13
|
|
|||||
Comprehensive income attributable to partners
|
$
|
1,003
|
|
|
$
|
445
|
|
|
$
|
1,485
|
|
|
$
|
(1,930
|
)
|
|
$
|
1,003
|
|
|
Three Months Ended June 30, 2018
|
||||||||||||||||||
|
Parent Guarantor
|
|
Subsidiary Issuer
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated Partnership
|
||||||||||
Revenues
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
14,118
|
|
|
$
|
—
|
|
|
$
|
14,118
|
|
Operating costs, expenses, and other
|
—
|
|
|
—
|
|
|
12,980
|
|
|
—
|
|
|
12,980
|
|
|||||
Operating income
|
—
|
|
|
—
|
|
|
1,138
|
|
|
—
|
|
|
1,138
|
|
|||||
Interest expense, net of capitalized interest
|
(289
|
)
|
|
(42
|
)
|
|
(89
|
)
|
|
—
|
|
|
(420
|
)
|
|||||
Equity in earnings of unconsolidated affiliates
|
701
|
|
|
66
|
|
|
92
|
|
|
(767
|
)
|
|
92
|
|
|||||
Gains on interest rate derivatives
|
20
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
20
|
|
|||||
Other, net
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|||||
Income from continuing operations before income tax expense
|
432
|
|
|
24
|
|
|
1,140
|
|
|
(767
|
)
|
|
829
|
|
|||||
Income tax expense from continuing operations
|
—
|
|
|
—
|
|
|
69
|
|
|
—
|
|
|
69
|
|
|||||
Income from continuing operations
|
432
|
|
|
24
|
|
|
1,071
|
|
|
(767
|
)
|
|
760
|
|
|||||
Loss from discontinued operations, net of income taxes
|
—
|
|
|
—
|
|
|
(26
|
)
|
|
—
|
|
|
(26
|
)
|
|||||
Net income
|
432
|
|
|
24
|
|
|
1,045
|
|
|
(767
|
)
|
|
734
|
|
|||||
Less: Net income attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
170
|
|
|
—
|
|
|
170
|
|
|||||
Less: Net income attributable to predecessor equity
|
—
|
|
|
—
|
|
|
132
|
|
|
—
|
|
|
132
|
|
|||||
Net income attributable to partners
|
$
|
432
|
|
|
$
|
24
|
|
|
$
|
743
|
|
|
$
|
(767
|
)
|
|
$
|
432
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Other comprehensive income
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
2
|
|
Comprehensive income
|
432
|
|
|
24
|
|
|
1,047
|
|
|
(767
|
)
|
|
736
|
|
|||||
Less: Comprehensive income attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
170
|
|
|
—
|
|
|
170
|
|
|||||
Less: Comprehensive income attributable to predecessor equity
|
—
|
|
|
—
|
|
|
132
|
|
|
—
|
|
|
132
|
|
|||||
Comprehensive income attributable to partners
|
$
|
432
|
|
|
$
|
24
|
|
|
$
|
745
|
|
|
$
|
(767
|
)
|
|
$
|
434
|
|
|
Six Months Ended June 30, 2019
|
||||||||||||||||||
|
Parent Guarantor
|
|
Subsidiary Issuer
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated Partnership
|
||||||||||
Revenues
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
26,998
|
|
|
$
|
—
|
|
|
$
|
26,998
|
|
Operating costs, expenses, and other
|
—
|
|
|
—
|
|
|
23,243
|
|
|
—
|
|
|
23,243
|
|
|||||
Operating income
|
—
|
|
|
—
|
|
|
3,755
|
|
|
—
|
|
|
3,755
|
|
|||||
Interest expense, net of capitalized interest
|
(778
|
)
|
|
(129
|
)
|
|
(198
|
)
|
|
—
|
|
|
(1,105
|
)
|
|||||
Equity in earnings of unconsolidated affiliates
|
2,849
|
|
|
1,119
|
|
|
142
|
|
|
(3,968
|
)
|
|
142
|
|
|||||
Losses on extinguishments of debt
|
—
|
|
|
—
|
|
|
(2
|
)
|
|
—
|
|
|
(2
|
)
|
|||||
Gains on interest rate derivatives
|
(196
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(196
|
)
|
|||||
Other, net
|
140
|
|
|
—
|
|
|
(11
|
)
|
|
—
|
|
|
129
|
|
|||||
Income before income tax benefit
|
2,015
|
|
|
990
|
|
|
3,686
|
|
|
(3,968
|
)
|
|
2,723
|
|
|||||
Income tax expense
|
—
|
|
|
—
|
|
|
161
|
|
|
—
|
|
|
161
|
|
|||||
Net income
|
2,015
|
|
|
990
|
|
|
3,525
|
|
|
(3,968
|
)
|
|
2,562
|
|
|||||
Less: Net income attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
522
|
|
|
—
|
|
|
522
|
|
|||||
Less: Net income attributable to redeemable noncontrolling interests
|
—
|
|
|
—
|
|
|
26
|
|
|
—
|
|
|
26
|
|
|||||
Net income attributable to partners
|
$
|
2,015
|
|
|
$
|
990
|
|
|
$
|
2,977
|
|
|
$
|
(3,968
|
)
|
|
$
|
2,014
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Other comprehensive income
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
9
|
|
|
$
|
—
|
|
|
$
|
9
|
|
Comprehensive income
|
2,015
|
|
|
990
|
|
|
3,534
|
|
|
(3,968
|
)
|
|
2,571
|
|
|||||
Less: Comprehensive income attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
522
|
|
|
—
|
|
|
522
|
|
|||||
Less: Comprehensive income attributable to redeemable noncontrolling interests
|
—
|
|
|
—
|
|
|
26
|
|
|
—
|
|
|
26
|
|
|||||
Comprehensive income attributable to partners
|
$
|
2,015
|
|
|
$
|
990
|
|
|
$
|
2,986
|
|
|
$
|
(3,968
|
)
|
|
$
|
2,023
|
|
|
Six Months Ended June 30, 2018
|
||||||||||||||||||
|
Parent Guarantor
|
|
Subsidiary Issuer
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated Partnership
|
||||||||||
Revenues
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
26,000
|
|
|
$
|
—
|
|
|
$
|
26,000
|
|
Operating costs, expenses, and other
|
—
|
|
|
—
|
|
|
23,757
|
|
|
—
|
|
|
23,757
|
|
|||||
Operating income
|
—
|
|
|
—
|
|
|
2,243
|
|
|
—
|
|
|
2,243
|
|
|||||
Interest expense, net of capitalized interest
|
(567
|
)
|
|
(82
|
)
|
|
(151
|
)
|
|
—
|
|
|
(800
|
)
|
|||||
Equity in earnings of unconsolidated affiliates
|
1,642
|
|
|
326
|
|
|
171
|
|
|
(1,968
|
)
|
|
171
|
|
|||||
Losses on extinguishments of debt
|
—
|
|
|
—
|
|
|
(109
|
)
|
|
—
|
|
|
(109
|
)
|
|||||
Gains on interest rate derivatives
|
72
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
72
|
|
|||||
Other, net
|
—
|
|
|
—
|
|
|
56
|
|
|
—
|
|
|
56
|
|
|||||
Income from continuing operations before income tax expense
|
1,147
|
|
|
244
|
|
|
2,210
|
|
|
(1,968
|
)
|
|
1,633
|
|
|||||
Income tax expense from continuing operations
|
—
|
|
|
—
|
|
|
59
|
|
|
—
|
|
|
59
|
|
|||||
Income from continuing operations
|
1,147
|
|
|
244
|
|
|
2,151
|
|
|
(1,968
|
)
|
|
1,574
|
|
|||||
Loss from discontinued operations, net of income taxes
|
—
|
|
|
—
|
|
|
(263
|
)
|
|
—
|
|
|
(263
|
)
|
|||||
Net income
|
1,147
|
|
|
244
|
|
|
1,888
|
|
|
(1,968
|
)
|
|
1,311
|
|
|||||
Less: Net income attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
334
|
|
|
—
|
|
|
334
|
|
|||||
Less: Net loss attributable to predecessor equity
|
—
|
|
|
—
|
|
|
(170
|
)
|
|
—
|
|
|
(170
|
)
|
|||||
Net income attributable to partners
|
$
|
1,147
|
|
|
$
|
244
|
|
|
$
|
1,724
|
|
|
$
|
(1,968
|
)
|
|
$
|
1,147
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Other comprehensive income
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3
|
|
|
$
|
—
|
|
|
$
|
3
|
|
Comprehensive income
|
1,147
|
|
|
244
|
|
|
1,891
|
|
|
(1,968
|
)
|
|
1,314
|
|
|||||
Less: Comprehensive income attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
334
|
|
|
—
|
|
|
334
|
|
|||||
Less: Comprehensive loss attributable to predecessor equity
|
—
|
|
|
—
|
|
|
(170
|
)
|
|
—
|
|
|
(170
|
)
|
|||||
Comprehensive income attributable to partners
|
$
|
1,147
|
|
|
$
|
244
|
|
|
$
|
1,727
|
|
|
$
|
(1,968
|
)
|
|
$
|
1,150
|
|
|
Six Months Ended June 30, 2019
|
||||||||||||||||||
|
Parent Guarantor
|
|
Subsidiary Issuer
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated Partnership
|
||||||||||
Cash flows provided by operating activities
|
$
|
2,089
|
|
|
$
|
942
|
|
|
$
|
4,986
|
|
|
$
|
(3,997
|
)
|
|
$
|
4,020
|
|
Cash flows provided by (used in) investing activities
|
(1,272
|
)
|
|
(942
|
)
|
|
(4,725
|
)
|
|
3,997
|
|
|
(2,942
|
)
|
|||||
Cash flows provided by (used in) financing activities
|
(817
|
)
|
|
—
|
|
|
(235
|
)
|
|
—
|
|
|
(1,052
|
)
|
|||||
Change in cash
|
—
|
|
|
—
|
|
|
26
|
|
|
—
|
|
|
26
|
|
|||||
Cash at beginning of period
|
—
|
|
|
—
|
|
|
418
|
|
|
—
|
|
|
418
|
|
|||||
Cash at end of period
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
444
|
|
|
$
|
—
|
|
|
$
|
444
|
|
|
Six Months Ended June 30, 2018
|
||||||||||||||||||
|
Parent Guarantor
|
|
Subsidiary Issuer
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Consolidated Partnership
|
||||||||||
Cash flows provided by operating activities
|
$
|
3,252
|
|
|
$
|
102
|
|
|
$
|
924
|
|
|
$
|
(989
|
)
|
|
$
|
3,289
|
|
Cash flows used in investing activities
|
(2,925
|
)
|
|
(99
|
)
|
|
(2,199
|
)
|
|
2,336
|
|
|
(2,887
|
)
|
|||||
Cash flows used in financing activities
|
(327
|
)
|
|
—
|
|
|
(1,285
|
)
|
|
(1,347
|
)
|
|
(2,959
|
)
|
|||||
Net increase in cash and cash equivalents of discontinued operations
|
—
|
|
|
—
|
|
|
2,740
|
|
|
—
|
|
|
2,740
|
|
|||||
Change in cash
|
—
|
|
|
3
|
|
|
180
|
|
|
—
|
|
|
183
|
|
|||||
Cash at beginning of period
|
—
|
|
|
(2
|
)
|
|
337
|
|
|
—
|
|
|
335
|
|
|||||
Cash at end of period
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
517
|
|
|
$
|
—
|
|
|
$
|
518
|
|
•
|
natural gas operations, including the following:
|
•
|
natural gas midstream and intrastate transportation and storage;
|
•
|
interstate natural gas transportation and storage; and
|
•
|
crude oil, NGL and refined products transportation, terminalling services and acquisition and marketing activities, as well as NGL storage and fractionation services.
|
|
Three Months Ended
June 30, |
|
|
|
Six Months Ended
June 30, |
|
|
||||||||||||||||
|
2019
|
|
2018
|
|
Change
|
|
2019
|
|
2018
|
|
Change
|
||||||||||||
Segment Adjusted EBITDA:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Intrastate transportation and storage
|
$
|
290
|
|
|
$
|
208
|
|
|
$
|
82
|
|
|
$
|
542
|
|
|
$
|
400
|
|
|
$
|
142
|
|
Interstate transportation and storage
|
460
|
|
|
375
|
|
|
85
|
|
|
916
|
|
|
741
|
|
|
175
|
|
||||||
Midstream
|
412
|
|
|
414
|
|
|
(2
|
)
|
|
794
|
|
|
791
|
|
|
3
|
|
||||||
NGL and refined products transportation and services
|
644
|
|
|
461
|
|
|
183
|
|
|
1,256
|
|
|
912
|
|
|
344
|
|
||||||
Crude oil transportation and services
|
751
|
|
|
548
|
|
|
203
|
|
|
1,557
|
|
|
1,012
|
|
|
545
|
|
||||||
Investment in Sunoco LP
|
152
|
|
|
140
|
|
|
12
|
|
|
305
|
|
|
249
|
|
|
56
|
|
||||||
Investment in USAC
|
105
|
|
|
95
|
|
|
10
|
|
|
206
|
|
|
95
|
|
|
111
|
|
||||||
All other
|
13
|
|
|
30
|
|
|
(17
|
)
|
|
46
|
|
|
75
|
|
|
(29
|
)
|
||||||
Total
|
2,827
|
|
|
2,271
|
|
|
556
|
|
|
5,622
|
|
|
4,275
|
|
|
1,347
|
|
||||||
Depreciation, depletion and amortization
|
(781
|
)
|
|
(692
|
)
|
|
(89
|
)
|
|
(1,552
|
)
|
|
(1,353
|
)
|
|
(199
|
)
|
||||||
Interest expense, net of capitalized interest
|
(578
|
)
|
|
(420
|
)
|
|
(158
|
)
|
|
(1,105
|
)
|
|
(800
|
)
|
|
(305
|
)
|
||||||
Impairment losses
|
—
|
|
|
—
|
|
|
—
|
|
|
(50
|
)
|
|
—
|
|
|
(50
|
)
|
||||||
Gains (losses) on interest rate derivatives
|
(122
|
)
|
|
20
|
|
|
(142
|
)
|
|
(196
|
)
|
|
72
|
|
|
(268
|
)
|
||||||
Non-cash compensation expense
|
(29
|
)
|
|
(32
|
)
|
|
3
|
|
|
(58
|
)
|
|
(55
|
)
|
|
(3
|
)
|
||||||
Unrealized gains (losses) on commodity risk management activities
|
(23
|
)
|
|
(265
|
)
|
|
242
|
|
|
26
|
|
|
(352
|
)
|
|
378
|
|
||||||
Losses on extinguishments of debt
|
—
|
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
|
(109
|
)
|
|
107
|
|
||||||
Inventory valuation adjustments
|
4
|
|
|
32
|
|
|
(28
|
)
|
|
97
|
|
|
57
|
|
|
40
|
|
||||||
Adjusted EBITDA related to unconsolidated affiliates
|
(163
|
)
|
|
(168
|
)
|
|
5
|
|
|
(309
|
)
|
|
(324
|
)
|
|
15
|
|
||||||
Equity in earnings of unconsolidated affiliates
|
77
|
|
|
92
|
|
|
(15
|
)
|
|
142
|
|
|
171
|
|
|
(29
|
)
|
||||||
Adjusted EBITDA related to discontinued operations
|
—
|
|
|
5
|
|
|
(5
|
)
|
|
—
|
|
|
25
|
|
|
(25
|
)
|
||||||
Other, net
|
104
|
|
|
(14
|
)
|
|
118
|
|
|
108
|
|
|
26
|
|
|
82
|
|
||||||
Income from continuing operations before income tax expense
|
1,316
|
|
|
829
|
|
|
487
|
|
|
2,723
|
|
|
1,633
|
|
|
1,090
|
|
||||||
Income tax expense from continuing operations
|
(35
|
)
|
|
(69
|
)
|
|
34
|
|
|
(161
|
)
|
|
(59
|
)
|
|
(102
|
)
|
||||||
Income from continuing operations
|
1,281
|
|
|
760
|
|
|
521
|
|
|
2,562
|
|
|
1,574
|
|
|
988
|
|
||||||
Loss from discontinued operations, net of income taxes
|
—
|
|
|
(26
|
)
|
|
26
|
|
|
—
|
|
|
(263
|
)
|
|
263
|
|
||||||
Net income
|
$
|
1,281
|
|
|
$
|
734
|
|
|
$
|
547
|
|
|
$
|
2,562
|
|
|
$
|
1,311
|
|
|
$
|
1,251
|
|
•
|
increases of $144 million and $254 million, respectively, recognized by the Partnership primarily due to to increases in long-term debt from ETO senior note issuances, including the ET-ETO senior notes exchange in March 2019. The increases also reflect higher interest rates on floating rate borrowings, as well as the impact of reductions of $31 million and $67 million, respectively, in capitalized interest due to the completion of major projects in 2018;
|
•
|
an increase of $7 million for the three months ended June 30, 2019 recognized by USAC primarily due to its senior notes issuance in March 2019 and an increase of $36 million for the six months ended June 30, 2019 primarily due to the consolidation of USAC beginning April 2, 2018, the date ET obtained control of USAC; and
|
•
|
increases of $7 million and $15 million, respectively, recognized by Sunoco LP primarily related to an increase in Sunoco LP’s total long-term debt.
|
|
Three Months Ended
June 30, |
|
|
|
Six Months Ended
June 30, |
|
|
||||||||||||||||
|
2019
|
|
2018
|
|
Change
|
|
2019
|
|
2018
|
|
Change
|
||||||||||||
Equity in earnings of unconsolidated affiliates:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Citrus
|
$
|
39
|
|
|
$
|
33
|
|
|
$
|
6
|
|
|
$
|
71
|
|
|
$
|
60
|
|
|
$
|
11
|
|
FEP
|
14
|
|
|
13
|
|
|
1
|
|
|
28
|
|
|
27
|
|
|
1
|
|
||||||
MEP
|
7
|
|
|
8
|
|
|
(1
|
)
|
|
14
|
|
|
17
|
|
|
(3
|
)
|
||||||
Other
|
17
|
|
|
38
|
|
|
(21
|
)
|
|
29
|
|
|
67
|
|
|
(38
|
)
|
||||||
Total equity in earnings of unconsolidated affiliates
|
$
|
77
|
|
|
$
|
92
|
|
|
$
|
(15
|
)
|
|
$
|
142
|
|
|
$
|
171
|
|
|
$
|
(29
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Adjusted EBITDA related to unconsolidated affiliates (1):
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Citrus
|
$
|
87
|
|
|
$
|
85
|
|
|
$
|
2
|
|
|
$
|
168
|
|
|
$
|
160
|
|
|
$
|
8
|
|
FEP
|
18
|
|
|
18
|
|
|
—
|
|
|
37
|
|
|
37
|
|
|
—
|
|
||||||
MEP
|
20
|
|
|
20
|
|
|
—
|
|
|
39
|
|
|
42
|
|
|
(3
|
)
|
||||||
Other
|
38
|
|
|
45
|
|
|
(7
|
)
|
|
65
|
|
|
85
|
|
|
(20
|
)
|
||||||
Total Adjusted EBITDA related to unconsolidated affiliates
|
$
|
163
|
|
|
$
|
168
|
|
|
$
|
(5
|
)
|
|
$
|
309
|
|
|
$
|
324
|
|
|
$
|
(15
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Distributions received from unconsolidated affiliates:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Citrus
|
$
|
39
|
|
|
$
|
27
|
|
|
$
|
12
|
|
|
$
|
74
|
|
|
$
|
73
|
|
|
$
|
1
|
|
FEP
|
16
|
|
|
15
|
|
|
1
|
|
|
33
|
|
|
32
|
|
|
1
|
|
||||||
MEP
|
15
|
|
|
18
|
|
|
(3
|
)
|
|
26
|
|
|
31
|
|
|
(5
|
)
|
||||||
Other
|
42
|
|
|
21
|
|
|
21
|
|
|
58
|
|
|
42
|
|
|
16
|
|
||||||
Total distributions received from unconsolidated affiliates
|
$
|
112
|
|
|
$
|
81
|
|
|
$
|
31
|
|
|
$
|
191
|
|
|
$
|
178
|
|
|
$
|
13
|
|
(1)
|
These amounts represent our proportionate share of the Adjusted EBITDA of our unconsolidated affiliates and are based on our equity in earnings or losses of our unconsolidated affiliates adjusted for our proportionate share of the unconsolidated affiliates’ interest, depreciation, depletion, amortization, non-cash items and taxes.
|
•
|
Segment margin, operating expenses, and selling, general and administrative expenses. These amounts represent the amounts included in our consolidated financial statements that are attributable to each segment.
|
•
|
Unrealized gains or losses on commodity risk management activities and inventory valuation adjustments. These are the unrealized amounts that are included in cost of products sold to calculate segment margin. These amounts are not included in Segment Adjusted EBITDA; therefore, the unrealized losses are added back and the unrealized gains are subtracted to calculate the segment measure.
|
•
|
Non-cash compensation expense. These amounts represent the total non-cash compensation recorded in operating expenses and selling, general and administrative expenses. This expense is not included in Segment Adjusted EBITDA and therefore is added back to calculate the segment measure.
|
•
|
Adjusted EBITDA related to unconsolidated affiliates. These amounts represent our proportionate share of the Adjusted EBITDA of our unconsolidated affiliates. Amounts reflected are calculated consistently with our definition of Adjusted EBITDA.
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Segment margin:
|
|
|
|
|
|
|
|
||||||||
Intrastate transportation and storage
|
$
|
365
|
|
|
$
|
267
|
|
|
$
|
649
|
|
|
$
|
438
|
|
Interstate transportation and storage
|
493
|
|
|
378
|
|
|
991
|
|
|
743
|
|
||||
Midstream
|
614
|
|
|
593
|
|
|
1,191
|
|
|
1,146
|
|
||||
NGL and refined products transportation and services
|
764
|
|
|
587
|
|
|
1,469
|
|
|
1,187
|
|
||||
Crude oil transportation and services
|
909
|
|
|
442
|
|
|
1,995
|
|
|
1,010
|
|
||||
Investment in Sunoco LP
|
269
|
|
|
310
|
|
|
639
|
|
|
606
|
|
||||
Investment in USAC
|
150
|
|
|
147
|
|
|
299
|
|
|
147
|
|
||||
All other
|
48
|
|
|
57
|
|
|
90
|
|
|
152
|
|
||||
Intersegment eliminations
|
(37
|
)
|
|
(6
|
)
|
|
(42
|
)
|
|
(17
|
)
|
||||
Total segment margin
|
3,575
|
|
|
2,775
|
|
|
7,281
|
|
|
5,412
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Less:
|
|
|
|
|
|
|
|
||||||||
Operating expenses
|
792
|
|
|
772
|
|
|
1,600
|
|
|
1,496
|
|
||||
Depreciation, depletion and amortization
|
781
|
|
|
692
|
|
|
1,552
|
|
|
1,353
|
|
||||
Selling, general and administrative
|
175
|
|
|
173
|
|
|
324
|
|
|
320
|
|
||||
Impairment losses
|
—
|
|
|
—
|
|
|
50
|
|
|
—
|
|
||||
Operating income
|
$
|
1,827
|
|
|
$
|
1,138
|
|
|
$
|
3,755
|
|
|
$
|
2,243
|
|
|
Three Months Ended
June 30, |
|
|
|
Six Months Ended
June 30, |
|
|
||||||||||||||||
|
2019
|
|
2018
|
|
Change
|
|
2019
|
|
2018
|
|
Change
|
||||||||||||
Natural gas transported (BBtu/d)
|
12,115
|
|
|
10,327
|
|
|
1,788
|
|
|
12,049
|
|
|
9,802
|
|
|
2,247
|
|
||||||
Withdrawals from storage natural gas inventory (BBtu)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
17,703
|
|
|
(17,703
|
)
|
||||||
Revenues
|
$
|
765
|
|
|
$
|
813
|
|
|
$
|
(48
|
)
|
|
$
|
1,621
|
|
|
$
|
1,688
|
|
|
$
|
(67
|
)
|
Cost of products sold
|
400
|
|
|
546
|
|
|
(146
|
)
|
|
972
|
|
|
1,250
|
|
|
(278
|
)
|
||||||
Segment margin
|
365
|
|
|
267
|
|
|
98
|
|
|
649
|
|
|
438
|
|
|
211
|
|
||||||
Unrealized (gains) losses on commodity risk management activities
|
(26
|
)
|
|
(8
|
)
|
|
(18
|
)
|
|
(16
|
)
|
|
45
|
|
|
(61
|
)
|
||||||
Operating expenses, excluding non-cash compensation expense
|
(47
|
)
|
|
(51
|
)
|
|
4
|
|
|
(89
|
)
|
|
(90
|
)
|
|
1
|
|
||||||
Selling, general and administrative expenses, excluding non-cash compensation expense
|
(7
|
)
|
|
(7
|
)
|
|
—
|
|
|
(13
|
)
|
|
(13
|
)
|
|
—
|
|
||||||
Adjusted EBITDA related to unconsolidated affiliates
|
5
|
|
|
7
|
|
|
(2
|
)
|
|
11
|
|
|
20
|
|
|
(9
|
)
|
||||||
Segment Adjusted EBITDA
|
$
|
290
|
|
|
$
|
208
|
|
|
$
|
82
|
|
|
$
|
542
|
|
|
$
|
400
|
|
|
$
|
142
|
|
|
Three Months Ended
June 30, |
|
|
|
Six Months Ended
June 30, |
|
|
||||||||||||||||
|
2019
|
|
2018
|
|
Change
|
|
2019
|
|
2018
|
|
Change
|
||||||||||||
Transportation fees
|
$
|
148
|
|
|
$
|
134
|
|
|
$
|
14
|
|
|
$
|
302
|
|
|
$
|
251
|
|
|
$
|
51
|
|
Natural gas sales and other (excluding unrealized gains and losses)
|
173
|
|
|
108
|
|
|
65
|
|
|
293
|
|
|
199
|
|
|
94
|
|
||||||
Retained fuel revenues (excluding unrealized gains and losses)
|
12
|
|
|
13
|
|
|
(1
|
)
|
|
23
|
|
|
26
|
|
|
(3
|
)
|
||||||
Storage margin (excluding unrealized gains and losses)
|
6
|
|
|
4
|
|
|
2
|
|
|
15
|
|
|
7
|
|
|
8
|
|
||||||
Unrealized gains (losses) on commodity risk management activities
|
26
|
|
|
8
|
|
|
18
|
|
|
16
|
|
|
(45
|
)
|
|
61
|
|
||||||
Total segment margin
|
$
|
365
|
|
|
$
|
267
|
|
|
$
|
98
|
|
|
$
|
649
|
|
|
$
|
438
|
|
|
$
|
211
|
|
•
|
an increase of $65 million in realized natural gas sales and other due to higher realized gains from pipeline optimization activity; and
|
•
|
an increase of $14 million in transportation fees primarily due to new contracts, as well as the impact of the Red Bluff Express pipeline coming online in May 2018.
|
•
|
an increase of $94 million in realized natural gas sales and other due to higher realized gains from pipeline optimization activity;
|
•
|
an increase of $27 million in transportation fees, excluding the impact of consolidating RIGS as discussed below, primarily due to new contracts, as well as the impact of the Red Bluff Express pipeline coming online in May 2018;
|
•
|
a net increase of $11 million due to the consolidation of RIGS beginning in April 2018, resulting in increases in transportation fees, retained fuel revenues and operating expenses of $24 million, $2 million, and $6 million, respectively, and a decrease of $9 million in Adjusted EBITDA related to unconsolidated affiliates; and
|
•
|
an increase of $8 million in realized storage margin primarily due to a $7 million increase in realized derivative gains and a $1 million increase in storage fees; partially offset by
|
•
|
a decrease of $3 million in retained fuel revenues primarily due to lower natural gas pricing.
|
|
Three Months Ended
June 30, |
|
|
|
Six Months Ended
June 30, |
|
|
||||||||||||||||
|
2019
|
|
2018
|
|
Change
|
|
2019
|
|
2018
|
|
Change
|
||||||||||||
Natural gas transported (BBtu/d)
|
10,825
|
|
|
8,707
|
|
|
2,118
|
|
|
11,177
|
|
|
8,457
|
|
|
2,720
|
|
||||||
Natural gas sold (BBtu/d)
|
17
|
|
|
17
|
|
|
—
|
|
|
18
|
|
|
17
|
|
|
1
|
|
||||||
Revenues
|
$
|
493
|
|
|
$
|
378
|
|
|
$
|
115
|
|
|
$
|
991
|
|
|
$
|
743
|
|
|
$
|
248
|
|
Operating expenses, excluding non-cash compensation, amortization and accretion expenses
|
(138
|
)
|
|
(110
|
)
|
|
(28
|
)
|
|
(284
|
)
|
|
(209
|
)
|
|
(75
|
)
|
||||||
Selling, general and administrative expenses, excluding non-cash compensation, amortization and accretion expenses
|
(18
|
)
|
|
(17
|
)
|
|
(1
|
)
|
|
(32
|
)
|
|
(35
|
)
|
|
3
|
|
||||||
Adjusted EBITDA related to unconsolidated affiliates
|
125
|
|
|
123
|
|
|
2
|
|
|
244
|
|
|
239
|
|
|
5
|
|
||||||
Other
|
(2
|
)
|
|
1
|
|
|
(3
|
)
|
|
(3
|
)
|
|
3
|
|
|
(6
|
)
|
||||||
Segment Adjusted EBITDA
|
$
|
460
|
|
|
$
|
375
|
|
|
$
|
85
|
|
|
$
|
916
|
|
|
$
|
741
|
|
|
$
|
175
|
|
•
|
an increase of $69 million from placing the Rover pipeline fully in-service, resulting in an increase of $101 million in revenues, partially offset by an increase of $32 million in operating expenses;
|
•
|
increases of $5 million and $3 million from higher utilization of our Transwestern and Trunkline pipeline systems, respectively;
|
•
|
an increase of $3 million for additional gas processing revenues on our Panhandle system;
|
•
|
an increase of $3 million from additional volume delivered from our Sea Robin pipeline as a result of fewer third-party supply interruptions; and
|
•
|
an increase of $2 million in Adjusted EBITDA from unconsolidated affiliates primarily due to new fixed transportation contracts on Citrus.
|
•
|
an increase of $129 million from placing the Rover pipeline fully in-service, resulting in an increase of $208 million in revenues, partially offset by an increase of $79 million in operating expenses;
|
•
|
an increase of $18 million from the Transwestern pipeline due to higher utilization as a result of more favorable market conditions;
|
•
|
an increase of $11 million on the Panhandle pipeline system primarily from additional gas processing revenues;
|
•
|
an increase of $7 million from additional volume delivered from the Sea Robin pipeline as a result of fewer third-party supply interruptions compared to the prior period;
|
•
|
increases of $4 million and $4 million from higher utilization of the Tiger and Trunkline pipeline systems, respectively; and
|
•
|
an increase of $5 million in Adjusted EBITDA from unconsolidated affiliates primarily due to new fixed transportation contracts on Citrus; partially offset by
|
•
|
a decrease of $6 million in other Adjusted EBITDA, including a $2 million decrease due to higher project-related expenses and a decrease of $1 million due to insurance reimbursements recovered in the prior period.
|
|
Three Months Ended
June 30, |
|
|
|
Six Months Ended
June 30, |
|
|
||||||||||||||||
|
2019
|
|
2018
|
|
Change
|
|
2019
|
|
2018
|
|
Change
|
||||||||||||
Gathered volumes (BBtu/d)
|
13,148
|
|
|
11,576
|
|
|
1,572
|
|
|
12,934
|
|
|
11,442
|
|
|
1,492
|
|
||||||
NGLs produced (MBbls/d)
|
565
|
|
|
513
|
|
|
52
|
|
|
564
|
|
|
508
|
|
|
56
|
|
||||||
Equity NGLs (MBbls/d)
|
30
|
|
|
31
|
|
|
(1
|
)
|
|
33
|
|
|
30
|
|
|
3
|
|
||||||
Revenues
|
$
|
1,198
|
|
|
$
|
1,874
|
|
|
$
|
(676
|
)
|
|
$
|
2,916
|
|
|
$
|
3,488
|
|
|
$
|
(572
|
)
|
Cost of products sold
|
584
|
|
|
1,281
|
|
|
(697
|
)
|
|
1,725
|
|
|
2,342
|
|
|
(617
|
)
|
||||||
Segment margin
|
614
|
|
|
593
|
|
|
21
|
|
|
1,191
|
|
|
1,146
|
|
|
45
|
|
||||||
Operating expenses, excluding non-cash compensation expense
|
(189
|
)
|
|
(169
|
)
|
|
(20
|
)
|
|
(372
|
)
|
|
(333
|
)
|
|
(39
|
)
|
||||||
Selling, general and administrative expenses, excluding non-cash compensation expense
|
(23
|
)
|
|
(20
|
)
|
|
(3
|
)
|
|
(42
|
)
|
|
(40
|
)
|
|
(2
|
)
|
||||||
Adjusted EBITDA related to unconsolidated affiliates
|
9
|
|
|
9
|
|
|
—
|
|
|
15
|
|
|
16
|
|
|
(1
|
)
|
||||||
Other
|
1
|
|
|
1
|
|
|
—
|
|
|
2
|
|
|
2
|
|
|
—
|
|
||||||
Segment Adjusted EBITDA
|
$
|
412
|
|
|
$
|
414
|
|
|
$
|
(2
|
)
|
|
$
|
794
|
|
|
$
|
791
|
|
|
$
|
3
|
|
|
Three Months Ended
June 30, |
|
|
|
Six Months Ended
June 30, |
|
|
||||||||||||||||
|
2019
|
|
2018
|
|
Change
|
|
2019
|
|
2018
|
|
Change
|
||||||||||||
Gathering and processing fee-based revenues
|
$
|
502
|
|
|
$
|
451
|
|
|
$
|
51
|
|
|
$
|
976
|
|
|
$
|
868
|
|
|
$
|
108
|
|
Non-fee-based contracts and processing
|
112
|
|
|
142
|
|
|
(30
|
)
|
|
215
|
|
|
278
|
|
|
(63
|
)
|
||||||
Total segment margin
|
$
|
614
|
|
|
$
|
593
|
|
|
$
|
21
|
|
|
$
|
1,191
|
|
|
$
|
1,146
|
|
|
$
|
45
|
|
•
|
a decrease of $30 million in non-fee-based margin due to lower NGL prices of $35 million and lower gas prices of $15 million, partially offset by the impact of increased throughput volume in the Permian region of $20 million;
|
•
|
an increase of $20 million in operating expenses due to an increase of $10 million in outside services, $7 million in maintenance project costs, and $3 million in employee costs; and
|
•
|
an increase of $3 million in selling, general and administrative expenses due to an increase in allocated overhead and an insurance payment received in the second quarter of 2018; partially offset by
|
•
|
an increase of $51 million in fee-based margin due to volume growth in the Northeast, Permian, Ark-La-Tex, North Texas and South Texas regions, offset by declines in the Mid-Continent/Panhandle regions.
|
•
|
an increase of $108 million in fee-based margin due to volume growth in the Northeast, Permian, Ark-La-Tex, North Texas and South Texas regions, offset by declines in the Mid-Continent/Panhandle regions; partially offset by
|
•
|
a decrease of $63 million in non-fee-based margin due to lower NGL prices of $72 million and lower gas prices of $23 million, partially offset by the impact of increased throughput volume in the North Texas, South Texas and Permian regions of $32 million;
|
•
|
an increase of $39 million in operating expenses due to increases of $20 million in outside services, $7 million in maintenance project costs, $7 million in employee costs; and $5 million in office and materials expenses; and
|
•
|
an increase of $2 million in selling, general and administrative expenses due to an insurance payment received in the second quarter of 2018.
|
|
Three Months Ended
June 30, |
|
|
|
Six Months Ended
June 30, |
|
|
||||||||||||||||
|
2019
|
|
2018
|
|
Change
|
|
2019
|
|
2018
|
|
Change
|
||||||||||||
NGL transportation volumes (MBbls/d)
|
1,305
|
|
|
967
|
|
|
338
|
|
|
1,241
|
|
|
951
|
|
|
290
|
|
||||||
Refined products transportation volumes (MBbls/d)
|
628
|
|
|
637
|
|
|
(9
|
)
|
|
623
|
|
|
629
|
|
|
(6
|
)
|
||||||
NGL and refined products terminal volumes (MBbls/d)
|
988
|
|
|
789
|
|
|
199
|
|
|
938
|
|
|
746
|
|
|
192
|
|
||||||
NGL fractionation volumes (MBbls/d)
|
701
|
|
|
473
|
|
|
228
|
|
|
690
|
|
|
473
|
|
|
217
|
|
||||||
Revenues
|
$
|
2,612
|
|
|
$
|
2,568
|
|
|
$
|
44
|
|
|
$
|
5,643
|
|
|
$
|
5,114
|
|
|
$
|
529
|
|
Cost of products sold
|
1,848
|
|
|
1,981
|
|
|
(133
|
)
|
|
4,174
|
|
|
3,927
|
|
|
247
|
|
||||||
Segment margin
|
764
|
|
|
587
|
|
|
177
|
|
|
1,469
|
|
|
1,187
|
|
|
282
|
|
||||||
Unrealized losses on commodity risk management activities
|
39
|
|
|
13
|
|
|
26
|
|
|
96
|
|
|
—
|
|
|
96
|
|
||||||
Operating expenses, excluding non-cash compensation expense
|
(155
|
)
|
|
(141
|
)
|
|
(14
|
)
|
|
(304
|
)
|
|
(280
|
)
|
|
(24
|
)
|
||||||
Selling, general and administrative expenses, excluding non-cash compensation expense
|
(26
|
)
|
|
(17
|
)
|
|
(9
|
)
|
|
(45
|
)
|
|
(35
|
)
|
|
(10
|
)
|
||||||
Adjusted EBITDA related to unconsolidated affiliates
|
21
|
|
|
19
|
|
|
2
|
|
|
39
|
|
|
40
|
|
|
(1
|
)
|
||||||
Other
|
1
|
|
|
—
|
|
|
1
|
|
|
1
|
|
|
—
|
|
|
1
|
|
||||||
Segment Adjusted EBITDA
|
$
|
644
|
|
|
$
|
461
|
|
|
$
|
183
|
|
|
$
|
1,256
|
|
|
$
|
912
|
|
|
$
|
344
|
|
|
Three Months Ended
June 30, |
|
|
|
Six Months Ended
June 30, |
|
|
||||||||||||||||
|
2019
|
|
2018
|
|
Change
|
|
2019
|
|
2018
|
|
Change
|
||||||||||||
Transportation margin
|
$
|
422
|
|
|
$
|
290
|
|
|
$
|
132
|
|
|
$
|
785
|
|
|
$
|
556
|
|
|
$
|
229
|
|
Fractionators and refinery services margin
|
174
|
|
|
128
|
|
|
46
|
|
|
360
|
|
|
262
|
|
|
98
|
|
||||||
Terminal services margin
|
146
|
|
|
91
|
|
|
55
|
|
|
263
|
|
|
185
|
|
|
78
|
|
||||||
Storage margin
|
53
|
|
|
48
|
|
|
5
|
|
|
109
|
|
|
104
|
|
|
5
|
|
||||||
Marketing margin
|
8
|
|
|
43
|
|
|
(35
|
)
|
|
48
|
|
|
80
|
|
|
(32
|
)
|
||||||
Unrealized losses on commodity risk management activities
|
(39
|
)
|
|
(13
|
)
|
|
(26
|
)
|
|
(96
|
)
|
|
—
|
|
|
(96
|
)
|
||||||
Total segment margin
|
$
|
764
|
|
|
$
|
587
|
|
|
$
|
177
|
|
|
$
|
1,469
|
|
|
$
|
1,187
|
|
|
$
|
282
|
|
•
|
an increase of $132 million in transportation margin primarily due to a $67 million increase resulting from the initiation of service on our Mariner East 2 pipeline in the fourth quarter of 2018, a $55 million increase resulting from higher throughput volumes received from the Permian region on our Texas NGL pipelines, a $7 million increase due to higher throughput volumes received from the Barnett region and a $3 million increase due to higher throughput volumes received from the Eagle Ford region;
|
•
|
an increase of $55 million in terminal services margin primarily due to a $51 million increase at Marcus Hook resulting from the initiation of service on our Mariner East 2 pipeline in the fourth quarter of 2018 and a $3 million increase due to higher throughput at our refined product terminals in the Northeast;
|
•
|
an increase of $46 million in fractionation and refinery services margin primarily due to a $50 million increase resulting from the commissioning of our fifth and sixth fractionators in July 2018 and February 2019, respectively, and higher NGL volumes from the Permian region feeding our Mont Belvieu fractionation facility. This increase was partially offset by a $3 million decrease primarily resulting from a reclassification between our fractionation and storage margins; and
|
•
|
an increase of $5 million in storage margin primarily due to a $3 million increase resulting from a reclassification between our storage and fractionation margins and a $2 million increase from throughput pipeline fees collected at our Mont Belvieu storage facility; partially offset by
|
•
|
a decrease of $35 million in marketing margin primarily due to a decrease of $16 million from the write down of the value of stored NGL inventory, as well as lower optimization gains due to less favorable market conditions;
|
•
|
an increase of $14 million in operating expenses primarily due to a $4 million increase resulting from to the commissioning of our fifth and sixth fractionators in July 2018 and February 2019, respectively, an aggregate increase of $7 million in ad valorem and employee expenses on our terminal and fractionation assets, and a $2 million increase in allocated costs; and
|
•
|
an increase of $9 million in selling, general and administrative expenses primarily due to a $4 million increase in allocated overhead costs, a $2 million increase in legal fees, a $1 million increase in employee costs and a $1 million increase in insurance expenses.
|
•
|
an increase of $229 million in transportation margin primarily due to a $123 million increase resulting from higher throughput volumes received from the Permian region on our Texas NGL pipelines, a $93 million increase due to the the initiation of service on our Mariner East 2 pipeline in the fourth quarter of 2018, a $14 million increase due to higher throughput volumes from the Barnett region and a $7 million increase due to higher throughput from the Eagle Ford region. These increases were partially offset by a decrease resulting from Mariner East 1 system downtime;
|
•
|
an increase of $98 million in fractionation and refinery services margin primarily due to a $109 million increase resulting from the commissioning of our fifth and sixth fractionators in July 2018 and February 2019, respectively, and higher NGL
|
•
|
an increase $78 million in terminal services margin primarily due to a $73 million increase due to the initiation of service on our Mariner East 2 pipeline in the fourth quarter of 2018 and a $5 million increase due to higher throughput at our refined product terminals in the Northeast; and
|
•
|
an increase of $5 million in storage margin primarily due to a $7 million increase resulting from a reclassification between our fractionation and storage margins. This increase was partially offset by a $2 million decrease from the expiration of and amendments to various refined products storage contracts; partially offset by
|
•
|
a decrease of $32 million in marketing margin primarily due to the write-down of the value of stored NGL inventory, as well lower optimization gains due to less favorable market conditions;
|
•
|
an increase of $24 million in operating expenses primarily due to a $5 million increase in costs to operate our fractionators due to the commissioning of our fifth and sixth fractionators in July 2018 and February 2019, respectively, and an aggregate increase of $13 million in ad valorem and employee expenses on our terminal and fractionation assets, and a $3 million increase in product losses and a $2 million increase in materials purchased; and
|
•
|
an increase of $10 million in selling, general and administrative expenses primarily due to a $3 million increase in allocated overhead costs, a $3 million increase in legal fees, a $2 million increase in insurance expenses and a $2 million increase in employee costs.
|
|
Three Months Ended
June 30, |
|
|
|
Six Months Ended
June 30, |
|
|
||||||||||||||||
|
2019
|
|
2018
|
|
Change
|
|
2019
|
|
2018
|
|
Change
|
||||||||||||
Crude transportation volumes (MBbls/d)
|
4,728
|
|
|
4,242
|
|
|
486
|
|
|
4,626
|
|
|
4,036
|
|
|
590
|
|
||||||
Crude terminals volumes (MBbls/d)
|
2,383
|
|
|
2,103
|
|
|
280
|
|
|
2,235
|
|
|
2,022
|
|
|
213
|
|
||||||
Revenues
|
$
|
5,046
|
|
|
$
|
4,803
|
|
|
$
|
243
|
|
|
$
|
9,232
|
|
|
$
|
8,548
|
|
|
$
|
684
|
|
Cost of products sold
|
4,137
|
|
|
4,361
|
|
|
(224
|
)
|
|
7,237
|
|
|
7,538
|
|
|
(301
|
)
|
||||||
Segment margin
|
909
|
|
|
442
|
|
|
467
|
|
|
1,995
|
|
|
1,010
|
|
|
985
|
|
||||||
Unrealized (gains) losses on commodity risk management activities
|
11
|
|
|
262
|
|
|
(251
|
)
|
|
(98
|
)
|
|
305
|
|
|
(403
|
)
|
||||||
Operating expenses, excluding non-cash compensation expense
|
(150
|
)
|
|
(144
|
)
|
|
(6
|
)
|
|
(300
|
)
|
|
(271
|
)
|
|
(29
|
)
|
||||||
Selling, general and administrative expenses, excluding non-cash compensation expense
|
(20
|
)
|
|
(20
|
)
|
|
—
|
|
|
(40
|
)
|
|
(42
|
)
|
|
2
|
|
||||||
Adjusted EBITDA related to unconsolidated affiliates
|
1
|
|
|
8
|
|
|
(7
|
)
|
|
(1
|
)
|
|
10
|
|
|
(11
|
)
|
||||||
Other
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
1
|
|
||||||
Segment Adjusted EBITDA
|
$
|
751
|
|
|
$
|
548
|
|
|
$
|
203
|
|
|
$
|
1,557
|
|
|
$
|
1,012
|
|
|
$
|
545
|
|
•
|
an increase of $216 million in segment margin (excluding unrealized gains and losses on commodity risk management activities) primarily due to a $142 million increase from higher throughput on our Texas crude pipeline system primarily due to increased production from the Permian region, a $75 million increase from higher throughput on the Bakken pipeline, and a $9 million increase from higher throughput, ship loading and tank rental fees at our Nederland terminal; partially offset by a $10 million decrease (excluding a net change of $251 million in unrealized gains and losses on commodity risk management activities) from our crude oil acquisition and marketing business primarily resulting from non-cash inventory valuation adjustments; partially offset by
|
•
|
an increase of $6 million in operating expenses primarily due to a $14 million increase in throughput-related costs on existing assets, partially offset by an $8 million decrease in ad valorem taxes and management fees; and
|
•
|
a decrease of $7 million in Adjusted EBITDA related to unconsolidated affiliates due to lower margin from jet fuel sales by our joint ventures.
|
•
|
an increase of $582 million in segment margin (excluding unrealized gains and losses on commodity risk management activities) primarily due to a $284 million increase resulting from higher throughput on our Texas crude pipeline system primarily due to increased production from Permian producers, a $166 million favorable variance resulting from increased throughput on the Bakken pipeline, a $114 million increase (excluding a net change of $403 million in unrealized gains and losses on commodity risk management activities) from our crude oil acquisition and marketing business primarily resulting from improved basis differentials between the Permian and Bakken producing regions to our Nederland terminal on the Texas Gulf Coast, and an $18 million increase primarily from higher throughput, ship loading and tank rental fees at our Nederland terminal; and
|
•
|
a decrease of $2 million in selling, general and administrative expenses primarily due to a $3 million decrease in management fees, and a $2 million decrease in overhead allocations, partially offset by a $3 million increase in insurance and employee costs; partially offset by
|
•
|
an increase of $29 million in operating expenses primarily due to a $44 million increase in throughput related costs on existing assets, partially offset by a $15 million decrease in ad valorem taxes and management fees; and
|
•
|
a decrease of $11 million in Adjusted EBITDA related to unconsolidated affiliates due to lower margin from jet fuel sales by our joint ventures.
|
|
Three Months Ended
June 30, |
|
|
|
Six Months Ended
June 30, |
|
|
||||||||||||||||
|
2019
|
|
2018
|
|
Change
|
|
2019
|
|
2018
|
|
Change
|
||||||||||||
Revenues
|
$
|
4,475
|
|
|
$
|
4,607
|
|
|
$
|
(132
|
)
|
|
$
|
8,167
|
|
|
$
|
8,356
|
|
|
$
|
(189
|
)
|
Cost of products sold
|
4,206
|
|
|
4,297
|
|
|
(91
|
)
|
|
7,528
|
|
|
7,750
|
|
|
(222
|
)
|
||||||
Segment margin
|
269
|
|
|
310
|
|
|
(41
|
)
|
|
639
|
|
|
606
|
|
|
33
|
|
||||||
Unrealized (gains) losses on commodity risk management activities
|
3
|
|
|
—
|
|
|
3
|
|
|
(3
|
)
|
|
—
|
|
|
(3
|
)
|
||||||
Operating expenses, excluding non-cash compensation expense
|
(89
|
)
|
|
(105
|
)
|
|
16
|
|
|
(187
|
)
|
|
(218
|
)
|
|
31
|
|
||||||
Selling, general and administrative expenses, excluding non-cash compensation expense
|
(31
|
)
|
|
(31
|
)
|
|
—
|
|
|
(55
|
)
|
|
(63
|
)
|
|
8
|
|
||||||
Inventory valuation adjustments
|
(4
|
)
|
|
(32
|
)
|
|
28
|
|
|
(97
|
)
|
|
(57
|
)
|
|
(40
|
)
|
||||||
Adjusted EBITDA related to discontinued operations
|
—
|
|
|
(5
|
)
|
|
5
|
|
|
—
|
|
|
(25
|
)
|
|
25
|
|
||||||
Other
|
4
|
|
|
3
|
|
|
1
|
|
|
8
|
|
|
6
|
|
|
2
|
|
||||||
Segment Adjusted EBITDA
|
$
|
152
|
|
|
$
|
140
|
|
|
$
|
12
|
|
|
$
|
305
|
|
|
$
|
249
|
|
|
$
|
56
|
|
•
|
a decrease of $16 million in operating expenses primarily as a result of lower salaries and benefits, maintenance, utilities, property tax, and environmental expenses as well as $7 million of acquisition costs in the prior periods; and
|
•
|
an increase of $5 million in Adjusted EBITDA from discontinued operations due to Sunoco LP’s retail divestment in January 2018; partially offset by
|
•
|
a decrease of $10 million in segment margin, excluding inventory valuation adjustments and unrealized gains and losses on commodity risk management activities, primarily due to a decrease in gross profit per gallon sold primarily as a result of an $8 million one-time charge related to a reserve for an open contractual dispute.
|
•
|
an aggregate decrease of $39 million in expenses primarily due to the conversion of 207 retail sites to commission agent sites in April 2018; and
|
•
|
an increase of $25 million in Adjusted EBITDA from discontinued operations due to Sunoco LP’s retail divestment in January 2018; partially offset by
|
•
|
a decrease of $10 million in segment margin, excluding inventory valuation adjustments and unrealized gains and losses on commodity risk management activities, primarily due to a decrease in gross profit per gallon sold primarily as a result of a $8 million one-time charge related to a reserve for an open contractual dispute.
|
|
Three Months Ended
June 30, |
|
|
|
Six Months Ended
June 30, |
|
|
||||||||||||||||
|
2019
|
|
2018
|
|
Change
|
|
2019
|
|
2018
|
|
Change
|
||||||||||||
Revenues
|
$
|
174
|
|
|
$
|
167
|
|
|
$
|
7
|
|
|
$
|
345
|
|
|
$
|
167
|
|
|
$
|
178
|
|
Cost of products sold
|
24
|
|
|
20
|
|
|
4
|
|
|
46
|
|
|
20
|
|
|
26
|
|
||||||
Segment margin
|
150
|
|
|
147
|
|
|
3
|
|
|
299
|
|
|
147
|
|
|
152
|
|
||||||
Operating expenses, excluding non-cash compensation expense
|
(32
|
)
|
|
(38
|
)
|
|
6
|
|
|
(67
|
)
|
|
(38
|
)
|
|
(29
|
)
|
||||||
Selling, general and administrative expenses, excluding non-cash compensation expense
|
(13
|
)
|
|
(19
|
)
|
|
6
|
|
|
(26
|
)
|
|
(19
|
)
|
|
(7
|
)
|
||||||
Other
|
—
|
|
|
5
|
|
|
(5
|
)
|
|
—
|
|
|
5
|
|
|
(5
|
)
|
||||||
Segment Adjusted EBITDA
|
$
|
105
|
|
|
$
|
95
|
|
|
$
|
10
|
|
|
$
|
206
|
|
|
$
|
95
|
|
|
$
|
111
|
|
•
|
a decrease of $6 million in operating expenses primarily due to a decrease of ad valorem taxes between periods as well as refunds received in the current period related to prior period ad valorem taxes;
|
•
|
a decrease of $6 million in selling, general administrative expenses primarily related to decreases of $4 million in transaction-related expenses and $2 million in employee expenses; and
|
•
|
an increase of $3 million in segment margin primarily due to an increase in demand for compression services resulting in an increase in average revenue generating horsepower.
|
|
Three Months Ended
June 30, |
|
|
|
Six Months Ended
June 30, |
|
|
||||||||||||||||
|
2019
|
|
2018
|
|
Change
|
|
2019
|
|
2018
|
|
Change
|
||||||||||||
Revenues
|
$
|
391
|
|
|
$
|
502
|
|
|
$
|
(111
|
)
|
|
$
|
888
|
|
|
$
|
1,073
|
|
|
$
|
(185
|
)
|
Cost of products sold
|
343
|
|
|
445
|
|
|
(102
|
)
|
|
798
|
|
|
921
|
|
|
(123
|
)
|
||||||
Segment margin
|
48
|
|
|
57
|
|
|
(9
|
)
|
|
90
|
|
|
152
|
|
|
(62
|
)
|
||||||
Unrealized (gains) losses on commodity risk management activities
|
(4
|
)
|
|
(2
|
)
|
|
(2
|
)
|
|
(5
|
)
|
|
2
|
|
|
(7
|
)
|
||||||
Operating expenses, excluding non-cash compensation expense
|
(6
|
)
|
|
(10
|
)
|
|
4
|
|
|
(13
|
)
|
|
(41
|
)
|
|
28
|
|
||||||
Selling, general and administrative expenses, excluding non-cash compensation expense
|
(20
|
)
|
|
(19
|
)
|
|
(1
|
)
|
|
(33
|
)
|
|
(37
|
)
|
|
4
|
|
||||||
Adjusted EBITDA related to unconsolidated affiliates
|
2
|
|
|
2
|
|
|
—
|
|
|
1
|
|
|
(1
|
)
|
|
2
|
|
||||||
Other and eliminations
|
(7
|
)
|
|
2
|
|
|
(9
|
)
|
|
6
|
|
|
—
|
|
|
6
|
|
||||||
Segment Adjusted EBITDA
|
$
|
13
|
|
|
$
|
30
|
|
|
$
|
(17
|
)
|
|
$
|
46
|
|
|
$
|
75
|
|
|
$
|
(29
|
)
|
•
|
our natural gas marketing operations;
|
•
|
our wholly-owned natural gas compression operations;
|
•
|
a noncontrolling interest in PES. Prior to PES’s reorganization in August 2018, ETO’s 33% interest in PES was reflected as an unconsolidated affiliate; subsequent to the August 2018 reorganization, ETO holds an approximately 7.4% interest in PES and no longer reflects PES as an affiliate; and
|
•
|
our investment in coal handling facilities.
|
•
|
a decrease of $7 million from power trading activities;
|
•
|
a decrease of $10 million due to lower revenue from our compressor equipment business;
|
•
|
a decrease of $4 million in optimized gains on residue gas sales; and
|
•
|
a decrease of $2 million from settled derivatives; partially offset by
|
•
|
an increase of $13 million in storage optimization gains.
|
•
|
a decrease of $36 million due to the contribution of CDM to USAC in April 2018, subsequent to which CDM is reflected in the Investment in USAC segment;
|
•
|
a decrease of $2 million due to residue gas sales; partially offset by
|
•
|
an increase of $12 million in gains from park and loan and storage activity.
|
|
Growth
|
|
Maintenance
|
||||||||||||
|
Low
|
|
High
|
|
Low
|
|
High
|
||||||||
Intrastate transportation and storage
|
$
|
125
|
|
|
$
|
150
|
|
|
$
|
35
|
|
|
$
|
40
|
|
Interstate transportation and storage (1)
|
350
|
|
|
375
|
|
|
135
|
|
|
140
|
|
||||
Midstream
|
800
|
|
|
850
|
|
|
160
|
|
|
165
|
|
||||
NGL and refined products transportation and services
|
2,800
|
|
|
2,850
|
|
|
90
|
|
|
100
|
|
||||
Crude oil transportation and services (1)
|
325
|
|
|
350
|
|
|
100
|
|
|
110
|
|
||||
All other (including eliminations)
|
200
|
|
|
225
|
|
|
50
|
|
|
55
|
|
||||
Total capital expenditures
|
$
|
4,600
|
|
|
$
|
4,800
|
|
|
$
|
570
|
|
|
$
|
610
|
|
(1)
|
Includes capital expenditures related to our proportionate ownership of the Bakken, Rover and Bayou Bridge pipeline projects.
|
|
Capital Expenditures Recorded During Period
|
||||||||||
|
Growth
|
|
Maintenance
|
|
Total
|
||||||
Intrastate transportation and storage (1)
|
$
|
8
|
|
|
$
|
28
|
|
|
$
|
36
|
|
Interstate transportation and storage
|
91
|
|
|
52
|
|
|
143
|
|
|||
Midstream
|
361
|
|
|
67
|
|
|
428
|
|
|||
NGL and refined products transportation and services
|
1,074
|
|
|
34
|
|
|
1,108
|
|
|||
Crude oil transportation and services
|
159
|
|
|
39
|
|
|
198
|
|
|||
Investment in Sunoco LP
|
47
|
|
|
10
|
|
|
57
|
|
|||
Investment in USAC
|
84
|
|
|
15
|
|
|
99
|
|
|||
All other (including eliminations)
|
72
|
|
|
16
|
|
|
88
|
|
|||
Total capital expenditures
|
$
|
1,896
|
|
|
$
|
261
|
|
|
$
|
2,157
|
|
(1)
|
For the six months ended June 30, 2019, growth capital expenditures for the intrastate transportation and storage segment reflect the proceeds received from the sale of a noncontrolling interest in the Red Bluff Express pipeline, which was based on capital expenditures from prior periods.
|
|
June 30, 2019
|
|
December 31, 2018
|
||||
ETO Senior Notes (1)
|
$
|
36,117
|
|
|
$
|
28,755
|
|
Transwestern Senior Notes
|
575
|
|
|
575
|
|
||
Panhandle Senior Notes
|
236
|
|
|
385
|
|
||
Bakken Senior Notes
|
2,500
|
|
|
—
|
|
||
Sunoco LP Senior Notes and lease-related obligations
|
2,912
|
|
|
2,307
|
|
||
USAC Senior Notes
|
1,475
|
|
|
725
|
|
||
Credit facilities and commercial paper:
|
|
|
|
||||
ETO $5.00 billion Revolving Credit Facility due December 2023 (2)
|
2,368
|
|
|
3,694
|
|
||
Bakken Project $2.50 billion Credit Facility due August 2019
|
—
|
|
|
2,500
|
|
||
Sunoco LP $1.50 billion Revolving Credit Facility due July 2023
|
117
|
|
|
700
|
|
||
USAC $1.60 billion Revolving Credit Facility due April 2023
|
363
|
|
|
1,050
|
|
||
Other long-term debt
|
4
|
|
|
7
|
|
||
Unamortized premiums, net of discounts and fair value adjustments
|
7
|
|
|
31
|
|
||
Deferred debt issuance costs
|
(292
|
)
|
|
(221
|
)
|
||
Total debt
|
46,382
|
|
|
40,508
|
|
||
Less: current maturities of long-term debt
|
7
|
|
|
2,655
|
|
||
Long-term debt, less current maturities
|
$
|
46,375
|
|
|
$
|
37,853
|
|
(1)
|
The increase in ETO Senior Notes during six months ended June 30, 2019 includes $4.21 billion issued in connection with the ET-ETO senior notes exchange and $4.00 billion issued in the January 2019 senior notes offering, both of which are discussed below. The June 30, 2019 balance also includes $250 million aggregate principal amount of 5.50% senior notes due February 15, 2020 that was classified as long-term as of June 30, 2019 as management has the intent and ability to refinance the borrowing on a long-term basis.
|
(2)
|
Includes $2.36 billion and $2.34 billion of commercial paper outstanding at June 30, 2019 and December 31, 2018, respectively.
|
•
|
$1.14 billion aggregate principal amount of 7.50% senior notes due 2020;
|
•
|
$995 million aggregate principal amount of 4.25% senior notes due 2023;
|
•
|
$1.13 billion aggregate principal amount of 5.875% senior notes due 2024; and
|
•
|
$956 million aggregate principal amount of 5.50% senior notes due 2027.
|
•
|
$750 million aggregate principal amount of 4.50% senior notes due 2024;
|
•
|
$1.50 billion aggregate principal amount of 5.25% senior notes due 2029; and
|
•
|
$1.75 billion aggregate principal amount of 6.25% senior notes due 2049.
|
•
|
ETO’s $400 million aggregate principal amount of 9.70% senior notes due March 15, 2019;
|
•
|
ETO’s $450 million aggregate principal amount of 9.00% senior notes due April 15, 2019; and
|
•
|
Panhandle’s $150 million aggregate principal amount of 8.125% senior notes due June 1, 2019.
|
•
|
$650 million aggregate principal amount of 3.625% senior notes due 2022;
|
•
|
$1.00 billion aggregate principal amount of 3.90% senior notes due 2024; and
|
•
|
$850 million aggregate principal amount of 4.625% senior notes due 2029.
|
Period Ended
|
|
Record Date
|
|
Payment Date
|
|
Series A (1)
|
|
Series B (1)
|
|
Series C
|
|
Series D
|
|
Series E (2)
|
||||||||||
December 31, 2018
|
|
February 1, 2019
|
|
February 15, 2019
|
|
$
|
31.25
|
|
|
$
|
33.125
|
|
|
$
|
0.4609
|
|
|
$
|
0.4766
|
|
|
$
|
—
|
|
March 31, 2019
|
|
May 1, 2019
|
|
May 15, 2019
|
|
—
|
|
|
—
|
|
|
0.4609
|
|
|
0.4766
|
|
|
—
|
|
|||||
June 30, 2019
|
|
August 1, 2019
|
|
August 15, 2019
|
|
31.25
|
|
|
33.125
|
|
|
0.4609
|
|
|
0.4766
|
|
|
0.5806
|
|
(1)
|
Series A Preferred Unit and Series B Preferred Unit distributions are paid on a semi-annual basis.
|
(2)
|
Series E Preferred Unit distributions related to the period ended June 30, 2019 represent a prorated initial distribution.
|
Quarter Ended
|
|
Record Date
|
|
Payment Date
|
|
Rate
|
||
December 31, 2018
|
|
February 6, 2019
|
|
February 14, 2019
|
|
$
|
0.8255
|
|
March 31, 2019
|
|
May 7, 2019
|
|
May 15, 2019
|
|
0.8255
|
|
|
June 30, 2019
|
|
August 6, 2019
|
|
August 14, 2019
|
|
0.8255
|
|
Quarter Ended
|
|
Record Date
|
|
Payment Date
|
|
Rate
|
||
December 31, 2018
|
|
January 28, 2019
|
|
February 8, 2019
|
|
$
|
0.5250
|
|
March 31, 2019
|
|
April 29, 2019
|
|
May 10, 2019
|
|
0.5250
|
|
|
June 30, 2019
|
|
July 29, 2019
|
|
August 9, 2019
|
|
0.5250
|
|
|
June 30, 2019
|
|
December 31, 2018
|
||||||||||||||||||
|
Notional Volume
|
|
Fair Value Asset (Liability)
|
|
Effect of Hypothetical 10% Change
|
|
Notional Volume
|
|
Fair Value Asset (Liability)
|
|
Effect of Hypothetical 10% Change
|
||||||||||
Mark-to-Market Derivatives
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
(Trading)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Natural Gas (BBtu):
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basis Swaps IFERC/NYMEX (1)
|
13,038
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
16,845
|
|
|
$
|
7
|
|
|
$
|
1
|
|
Fixed Swaps/Futures
|
775
|
|
|
—
|
|
|
—
|
|
|
468
|
|
|
—
|
|
|
—
|
|
||||
Options – Puts
|
—
|
|
|
—
|
|
|
—
|
|
|
10,000
|
|
|
—
|
|
|
—
|
|
||||
Power (Megawatt):
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Forwards
|
2,554,800
|
|
|
9
|
|
|
6
|
|
|
3,141,520
|
|
|
6
|
|
|
8
|
|
||||
Futures
|
1,095,558
|
|
|
(1
|
)
|
|
—
|
|
|
56,656
|
|
|
—
|
|
|
—
|
|
||||
Options – Puts
|
175,200
|
|
|
—
|
|
|
—
|
|
|
18,400
|
|
|
—
|
|
|
—
|
|
||||
Options – Calls
|
317,600
|
|
|
—
|
|
|
—
|
|
|
284,800
|
|
|
1
|
|
|
—
|
|
||||
(Non-Trading)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Natural Gas (BBtu):
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basis Swaps IFERC/NYMEX
|
(23,115
|
)
|
|
(12
|
)
|
|
6
|
|
|
(30,228
|
)
|
|
(52
|
)
|
|
13
|
|
||||
Swing Swaps IFERC
|
8,480
|
|
|
(2
|
)
|
|
—
|
|
|
54,158
|
|
|
12
|
|
|
—
|
|
||||
Fixed Swaps/Futures
|
(3,505
|
)
|
|
—
|
|
|
1
|
|
|
(1,068
|
)
|
|
19
|
|
|
1
|
|
||||
Forward Physical Contracts
|
(22,542
|
)
|
|
4
|
|
|
6
|
|
|
(123,254
|
)
|
|
(1
|
)
|
|
32
|
|
||||
NGLs (MBbls) – Forwards/Swaps
|
(1,612
|
)
|
|
(32
|
)
|
|
35
|
|
|
(2,135
|
)
|
|
67
|
|
|
67
|
|
||||
Refined Products (MBbls) – Futures
|
(126
|
)
|
|
(3
|
)
|
|
8
|
|
|
(1,403
|
)
|
|
(8
|
)
|
|
6
|
|
||||
Crude (MBbls) – Forwards/Swaps
|
18,670
|
|
|
39
|
|
|
9
|
|
|
20,888
|
|
|
(60
|
)
|
|
29
|
|
||||
Corn (thousand bushels)
|
(2,605
|
)
|
|
1
|
|
|
1
|
|
|
(1,920
|
)
|
|
—
|
|
|
1
|
|
||||
Fair Value Hedging Derivatives
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
(Non-Trading)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Natural Gas (BBtu):
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basis Swaps IFERC/NYMEX
|
(31,703
|
)
|
|
2
|
|
|
—
|
|
|
(17,445
|
)
|
|
(4
|
)
|
|
—
|
|
||||
Fixed Swaps/Futures
|
(31,703
|
)
|
|
12
|
|
|
8
|
|
|
(17,445
|
)
|
|
(10
|
)
|
|
6
|
|
(1)
|
Includes aggregate amounts for open positions related to Houston Ship Channel, Waha Hub, NGPL TexOk, West Louisiana Zone and Henry Hub locations.
|
Term
|
|
Type(1)
|
|
Notional Amount Outstanding
|
||||||
June 30, 2019
|
|
December 31, 2018
|
||||||||
July 2019(2)
|
|
Forward-starting to pay a fixed rate of 3.56% and receive a floating rate
|
|
$
|
—
|
|
|
$
|
400
|
|
July 2020(2)
|
|
Forward-starting to pay a fixed rate of 3.52% and receive a floating rate
|
|
400
|
|
|
400
|
|
||
July 2021(2)
|
|
Forward-starting to pay a fixed rate of 3.55% and receive a floating rate
|
|
400
|
|
|
400
|
|
||
July 2022(2)
|
|
Forward-starting to pay a fixed rate of 3.80% and receive a floating rate
|
|
400
|
|
|
—
|
|
||
March 2019
|
|
Pay a floating rate and receive a fixed rate of 1.42%
|
|
—
|
|
|
300
|
|
(1)
|
Floating rates are based on 3-month LIBOR.
|
(2)
|
Represents the effective date. These forward-starting swaps have terms of 30 years with a mandatory termination date the same as the effective date.
|
Exhibit Number
|
|
Description
|
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
101.SCH*
|
|
XBRL Taxonomy Extension Schema Document
|
101.CAL*
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
101.DEF*
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
101.LAB*
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
101.PRE*
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
*
|
|
Filed herewith.
|
**
|
|
Furnished herewith.
|
|
|
ENERGY TRANSFER OPERATING, L.P.
|
|
|
|
|
|
|
|
By:
|
Energy Transfer Partners GP, L.P.,
|
|
|
|
its general partner
|
|
|
|
|
|
|
By:
|
Energy Transfer Partners, L.L.C.,
|
|
|
|
its general partner
|
|
|
|
|
Date:
|
August 8, 2019
|
By:
|
/s/ A. Troy Sturrock
|
|
|
|
A. Troy Sturrock
|
|
|
|
Senior Vice President, Controller and Principal Accounting Officer
(duly authorized to sign on behalf of the registrant)
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Energy Transfer Operating, L.P.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
/s/ Kelcy L. Warren
|
Kelcy L. Warren
|
Chief Executive Officer
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Energy Transfer Operating, L.P.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
/s/ Thomas E. Long
|
Thomas E. Long
|
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, as amended; 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/ Kelcy L. Warren
|
Kelcy L. Warren
|
Chief Executive Officer
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; 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 E. Long
|
Thomas E. Long
|
Chief Financial Officer
|