(Mark One)
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x
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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or
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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FOR THE TRANSITION PERIOD FROM TO
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COMMISSION FILE NUMBER 1-35574
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DELAWARE
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37-1661577
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(State or other jurisdiction of incorporation or organization)
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(IRS Employer Identification No.)
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625 Liberty Avenue, Suite 1700, Pittsburgh, Pennsylvania
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15222
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(Address of principal executive offices)
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(Zip code)
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(412) 553-5700
(Registrant’s telephone number, including area code)
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Large Accelerated Filer
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x
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Accelerated Filer
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¨
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Non-Accelerated Filer
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¨
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Smaller reporting company
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¨
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Page No.
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Three Months Ended
March 31, |
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2015
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2014
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(Thousands, except per unit amounts)
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||||||
Operating revenues
(2)
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$
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154,811
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$
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107,908
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Operating expenses:
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Operating and maintenance
(3)
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14,479
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12,739
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Selling, general and administrative
(3)
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15,653
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12,555
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Depreciation and amortization
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11,927
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9,997
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Total operating expenses
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42,059
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35,291
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Operating income
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112,752
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72,617
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Other income
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714
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269
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Interest expense
(4)
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11,457
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5,655
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Income before income taxes
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102,009
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67,231
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Income tax expense
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6,703
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12,233
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Net income
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$
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95,306
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$
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54,998
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Calculation of limited partner interest in net income:
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Net income
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$
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95,306
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$
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54,998
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Less pre-acquisition net income allocated to parent
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(11,106
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)
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(20,143
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)
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Less general partner interest in net income
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(9,729
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)
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(1,723
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)
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Limited partner interest in net income
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$
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74,471
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$
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33,132
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Net income per limited partner unit – basic
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$
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1.18
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$
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0.69
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Net income per limited partner unit – diluted
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$
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1.18
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$
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0.69
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Weighted average limited partner units outstanding – basic
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63,211
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47,819
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Weighted average limited partner units outstanding – diluted
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63,379
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47,938
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Cash distributions declared per unit
(5)
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$
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0.61
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$
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0.49
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(1)
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Financial statements for the three months ended March 31, 2015 have been retrospectively recast to reflect the inclusion of the
Northern West Virginia Marcellus gathering system
(
NWV Gathering
). Financial statements for the three months ended March 31, 2014 have been retrospectively recast to reflect the inclusion of
NWV Gathering
and the Jupiter natural gas gathering system (Jupiter). See Note B.
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(2)
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Operating revenues included affiliate revenues from EQT Corporation and subsidiaries (collectively, EQT) of
$106.6 million
and
$72.3 million
for the
three months ended March 31, 2015
and
2014
, respectively. See Note D.
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(3)
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Operating and maintenance expense included charges from EQT of
$7.6 million
and
$6.3 million
for the
three months ended March 31, 2015
and
2014
, respectively. Selling, general and administrative expense included charges from EQT of
$12.8 million
and
$9.9 million
for the
three months ended March 31, 2015
and
2014
, respectively. See Note D.
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(4)
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Interest expense for the
three months ended March 31, 2015
and
2014
included
$5.9 million
and
$4.9 million
, respectively, related to interest on a capital lease with an affiliate.
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(5)
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Represents the cash distributions declared related to the period presented. See Note I.
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Three Months Ended
March 31, |
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2015
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2014
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(Thousands)
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Cash flows from operating activities:
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Net income
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$
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95,306
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$
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54,998
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Adjustments to reconcile net income to net cash provided by operating activities:
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Depreciation and amortization
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11,927
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9,997
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Deferred income taxes
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2,998
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3,494
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Other income
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(714
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)
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(269
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)
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Non-cash long-term compensation expense
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566
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978
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Changes in other assets and liabilities:
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Accounts receivable
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32
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(5,625
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)
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Accounts payable
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(4,784
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)
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(243
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)
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Due to/from EQT affiliates
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12,623
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(14,614
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)
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Other assets and liabilities
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(3,295
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)
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(1,073
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)
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Net cash provided by operating activities
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114,659
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47,643
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Cash flows from investing activities:
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Capital expenditures
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(91,415
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)
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(52,008
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)
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MVP Interest Acquisition
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(54,229
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)
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—
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NWV Gathering Acquisition – net assets from EQT
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(386,791
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)
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—
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Net cash used in investing activities
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(532,435
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)
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(52,008
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)
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Cash flows from financing activities:
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Proceeds from the issuance of common units, net of offering costs
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698,600
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—
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NWV Gathering Acquisition – purchase price in excess of net assets from EQT
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(486,392
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—
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Proceeds from short-term loans
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390,000
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110,000
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Payments of short-term loans
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(91,000
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)
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—
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Discount, debt issuance costs and credit facility fees
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—
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(2,020
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)
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Sunrise Merger payment
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—
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(110,000
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)
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Distributions paid to unitholders
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(41,180
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)
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(23,039
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)
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Capital contributions
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33
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(118
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)
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Net (distributions to) contributions from EQT
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(23,866
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)
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36,175
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Capital lease principal payments
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(4,477
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)
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(948
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)
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Net cash provided by financing activities
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441,718
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10,050
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Net change in cash and cash equivalents
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23,942
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5,685
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Cash and cash equivalents at beginning of period
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126,175
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18,363
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Cash and cash equivalents at end of period
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$
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150,117
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$
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24,048
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|
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Cash paid during the period for:
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Interest paid
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$
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17,823
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$
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4,866
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Non-cash activity during the period for
:
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Increase in capital lease asset/obligation
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$
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3,087
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$
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3,625
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Elimination of net deferred tax liabilities
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80,741
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—
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Limited partner and general partner units issued for acquisitions
|
52,500
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—
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Settlement of current income taxes payable/(receivable) with EQT
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3,705
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(18,322
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)
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(1)
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Financial statements for the three months ended March 31, 2015 have been retrospectively recast to reflect the inclusion of
NWV Gathering
. Financial statements for the three months ended March 31, 2014 have been retrospectively recast to reflect the inclusion of
NWV Gathering
and Jupiter. See Note B.
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March 31,
2015 |
|
December 31, 2014
|
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ASSETS
|
(Thousands, except number of
units)
|
||||||
Current assets:
|
|
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|
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Cash and cash equivalents
|
$
|
150,117
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$
|
126,175
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Accounts receivable (net of allowance for doubtful accounts of $245 as of March 31, 2015 and $260 as of December 31, 2014)
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16,461
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16,492
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Accounts receivable – affiliate
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59,371
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55,068
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|
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Other current assets
|
12,353
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1,710
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|
||
Total current assets
|
238,302
|
|
|
199,445
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|
||
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|
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|
||||
Property, plant and equipment
|
1,876,267
|
|
|
1,821,803
|
|
||
Less: accumulated depreciation
|
(226,914
|
)
|
|
(216,486
|
)
|
||
Net property, plant and equipment
|
1,649,353
|
|
|
1,605,317
|
|
||
|
|
|
|
||||
Equity in nonconsolidated investments
|
45,886
|
|
|
—
|
|
||
Other assets
|
17,828
|
|
|
18,057
|
|
||
Total assets
|
$
|
1,951,369
|
|
|
$
|
1,822,819
|
|
|
|
|
|
||||
LIABILITIES AND PARTNERS’ CAPITAL
|
|
|
|
|
|
||
Current liabilities:
|
|
|
|
|
|
||
Accounts payable
|
$
|
21,562
|
|
|
$
|
43,785
|
|
Due to related party
|
30,101
|
|
|
33,342
|
|
||
Short-term loans
|
299,000
|
|
|
—
|
|
||
Accrued interest
|
3,596
|
|
|
8,338
|
|
||
Accrued liabilities
|
4,535
|
|
|
9,055
|
|
||
Total current liabilities
|
358,794
|
|
|
94,520
|
|
||
|
|
|
|
||||
Deferred income taxes
|
—
|
|
|
78,583
|
|
||
Long-term debt
|
492,825
|
|
|
492,633
|
|
||
Lease obligation
|
144,794
|
|
|
143,828
|
|
||
Other long-term liabilities
|
7,872
|
|
|
7,111
|
|
||
Total liabilities
|
1,004,285
|
|
|
816,675
|
|
||
|
|
|
|
||||
Partners’ capital:
|
|
|
|
|
|
||
Predecessor equity
|
—
|
|
|
315,105
|
|
||
Common units (70,707,706 and 43,347,452 units issued and outstanding at March 31, 2015 and December 31, 2014, respectively)
|
988,727
|
|
|
1,647,910
|
|
||
Subordinated units (17,339,718 units issued and outstanding at December 31, 2014)
|
—
|
|
|
(929,374
|
)
|
||
General partner interest (1,443,015 and 1,238,514 units issued and outstanding at March 31, 2015 and December 31, 2014, respectively)
|
(41,643
|
)
|
|
(27,497
|
)
|
||
Total partners’ capital
|
947,084
|
|
|
1,006,144
|
|
||
Total liabilities and partners’ capital
|
$
|
1,951,369
|
|
|
$
|
1,822,819
|
|
|
|
|
Partners’ Capital
|
|
|
||||||||||||||
|
Predecessor
|
|
Limited Partners
|
|
General
|
|
|
||||||||||||
|
Equity
|
|
Common
|
|
Subordinated
|
|
Partner
|
|
Total
|
||||||||||
|
(Thousands)
|
||||||||||||||||||
Balance at January 1, 2014
|
$
|
310,861
|
|
|
$
|
818,431
|
|
|
$
|
(175,996
|
)
|
|
$
|
1,753
|
|
|
$
|
955,049
|
|
Net income
|
20,143
|
|
|
21,116
|
|
|
12,016
|
|
|
1,723
|
|
|
54,998
|
|
|||||
Capital contribution
|
—
|
|
|
102
|
|
|
58
|
|
|
3
|
|
|
163
|
|
|||||
Equity-based compensation plans
|
—
|
|
|
1,060
|
|
|
—
|
|
|
—
|
|
|
1,060
|
|
|||||
Distributions to unitholders
|
—
|
|
|
(14,016
|
)
|
|
(7,976
|
)
|
|
(1,047
|
)
|
|
(23,039
|
)
|
|||||
Net contributions from EQT
|
17,853
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
17,853
|
|
|||||
Balance at March 31, 2014
|
$
|
348,857
|
|
|
$
|
826,693
|
|
|
$
|
(171,898
|
)
|
|
$
|
2,432
|
|
|
$
|
1,006,084
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Balance at January 1, 2015
|
$
|
315,105
|
|
|
$
|
1,647,910
|
|
|
$
|
(929,374
|
)
|
|
$
|
(27,497
|
)
|
|
$
|
1,006,144
|
|
Net income
|
11,106
|
|
|
74,471
|
|
|
—
|
|
|
9,729
|
|
|
95,306
|
|
|||||
Capital contribution
|
—
|
|
|
209
|
|
|
—
|
|
|
4
|
|
|
213
|
|
|||||
Equity-based compensation plans
|
—
|
|
|
571
|
|
|
—
|
|
|
33
|
|
|
604
|
|
|||||
Distributions to unitholders
|
—
|
|
|
(25,142
|
)
|
|
(10,057
|
)
|
|
(5,981
|
)
|
|
(41,180
|
)
|
|||||
Conversion of subordinated units to common units
(2)
|
—
|
|
|
(939,431
|
)
|
|
939,431
|
|
|
—
|
|
|
—
|
|
|||||
Net distributions to EQT
|
(23,866
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(23,866
|
)
|
|||||
Proceeds from equity offering, net of offering costs
|
—
|
|
|
696,681
|
|
|
—
|
|
|
1,919
|
|
|
698,600
|
|
|||||
Elimination of net current and deferred tax liabilities
|
84,446
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
84,446
|
|
|||||
NWV Gathering net assets from EQT
|
(386,791
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(386,791
|
)
|
|||||
Issuance of units
|
—
|
|
|
38,910
|
|
|
—
|
|
|
13,590
|
|
|
52,500
|
|
|||||
Purchase price in excess of net assets from EQT
|
—
|
|
|
(505,452
|
)
|
|
—
|
|
|
(33,440
|
)
|
|
(538,892
|
)
|
|||||
Balance at March 31, 2015
|
$
|
—
|
|
|
$
|
988,727
|
|
|
$
|
—
|
|
|
$
|
(41,643
|
)
|
|
$
|
947,084
|
|
(1)
|
Financial statements for the three months ended March 31, 2015 have been retrospectively recast to reflect the inclusion of
NWV Gathering
. Financial statements for the three months ended March 31, 2014 have been retrospectively recast to reflect the inclusion of
NWV Gathering
and Jupiter. See Note B.
|
(2)
|
All subordinated units were converted to common units on a one-for-one basis on February 17, 2015. For purposes of calculating net income per common and subordinated unit, the conversion of the subordinated units is deemed to have occurred on January 1, 2015. See Note H.
|
|
Limited Partner Units
|
|
General
|
|
|
||||||
|
Common
|
|
Subordinated
|
|
Partner Units
|
|
Total
|
||||
Balance at January 1, 2014
|
30,468,902
|
|
|
17,339,718
|
|
|
975,686
|
|
|
48,784,306
|
|
May 2014 equity offering
|
12,362,500
|
|
|
—
|
|
|
—
|
|
|
12,362,500
|
|
Jupiter Acquisition consideration
|
516,050
|
|
|
—
|
|
|
262,828
|
|
|
778,878
|
|
Balance at December 31, 2014
|
43,347,452
|
|
|
17,339,718
|
|
|
1,238,514
|
|
|
61,925,684
|
|
Conversion of subordinated units to common units
|
17,339,718
|
|
|
(17,339,718
|
)
|
|
—
|
|
|
—
|
|
2014 EQM VDA issuance
|
21,063
|
|
|
—
|
|
|
430
|
|
|
21,493
|
|
March 2015 equity offering
|
9,487,500
|
|
|
—
|
|
|
25,255
|
|
|
9,512,755
|
|
NWV Gathering Acquisition consideration
|
511,973
|
|
|
—
|
|
|
178,816
|
|
|
690,789
|
|
Balance at March 31, 2015
|
70,707,706
|
|
|
—
|
|
|
1,443,015
|
|
|
72,150,721
|
|
|
Three Months Ended
March 31, |
||||||
|
2015
|
|
2014
|
||||
|
(Thousands)
|
||||||
Revenues from external customers (including affiliates):
|
|
|
|
|
|
||
Transmission and storage
|
$
|
79,361
|
|
|
$
|
59,317
|
|
Gathering
|
75,450
|
|
|
48,591
|
|
||
Total
|
$
|
154,811
|
|
|
$
|
107,908
|
|
|
|
|
|
||||
Operating income:
|
|
|
|
|
|
||
Transmission and storage
|
$
|
57,290
|
|
|
$
|
42,037
|
|
Gathering
|
55,462
|
|
|
30,580
|
|
||
Total operating income
|
$
|
112,752
|
|
|
$
|
72,617
|
|
|
|
|
|
||||
Reconciliation of operating income to net income:
|
|
|
|
|
|||
Other income
|
714
|
|
|
269
|
|
||
Interest expense
|
11,457
|
|
|
5,655
|
|
||
Income tax expense
|
6,703
|
|
|
12,233
|
|
||
Net income
|
$
|
95,306
|
|
|
$
|
54,998
|
|
|
March 31, 2015
|
|
December 31, 2014
|
||||
|
(Thousands)
|
||||||
Segment assets:
|
|
|
|
|
|
||
Transmission and storage
|
$
|
936,265
|
|
|
$
|
928,864
|
|
Gathering
|
808,233
|
|
|
765,090
|
|
||
Total operating segments
|
1,744,498
|
|
|
1,693,954
|
|
||
Headquarters, including cash
|
206,871
|
|
|
128,865
|
|
||
Total assets
|
$
|
1,951,369
|
|
|
$
|
1,822,819
|
|
|
Three Months Ended
March 31, |
||||||
|
2015
|
|
2014
|
||||
|
(Thousands)
|
||||||
Depreciation and amortization:
|
|
|
|
|
|
||
Transmission and storage
|
$
|
6,768
|
|
|
$
|
6,159
|
|
Gathering
|
5,159
|
|
|
3,838
|
|
||
Total
|
$
|
11,927
|
|
|
$
|
9,997
|
|
|
|
|
|
||||
Expenditures for segment assets:
|
|
|
|
||||
Transmission and storage
|
$
|
21,462
|
|
|
$
|
14,001
|
|
Gathering
|
36,269
|
|
|
34,449
|
|
||
Total
(1)
|
$
|
57,731
|
|
|
$
|
48,450
|
|
|
Three Months Ended
March 31, |
||||||
|
2015
|
|
2014
|
||||
|
(Thousands, except per unit data)
|
||||||
Net income
|
$
|
95,306
|
|
|
$
|
54,998
|
|
Less:
|
|
|
|
||||
Pre-acquisition net income allocated to parent
|
(11,106
|
)
|
|
(20,143
|
)
|
||
General partner interest in net income – 2%
|
(1,684
|
)
|
|
(697
|
)
|
||
General partner interest in net income attributable to incentive distribution rights
|
(8,045
|
)
|
|
(1,026
|
)
|
||
Limited partner interest in net income
|
$
|
74,471
|
|
|
$
|
33,132
|
|
|
|
|
|
||||
Net income allocable to common units - basic
|
$
|
74,471
|
|
|
$
|
21,116
|
|
Net income allocable to subordinated units - basic
|
—
|
|
|
12,016
|
|
||
Limited partner interest in net income - basic
|
$
|
74,471
|
|
|
$
|
33,132
|
|
|
|
|
|
||||
Net income allocable to common units – diluted
|
$
|
74,471
|
|
|
$
|
21,125
|
|
Net income allocable to subordinated units – diluted
|
—
|
|
|
12,007
|
|
||
Limited partner interest in net income – diluted
|
$
|
74,471
|
|
|
$
|
33,132
|
|
|
|
|
|
||||
Weighted average limited partner units outstanding – basic
|
|
|
|
||||
Common units
|
63,211
|
|
|
30,479
|
|
||
Subordinated units
|
—
|
|
|
17,340
|
|
||
Total
|
63,211
|
|
|
47,819
|
|
||
|
|
|
|
||||
Weighted average limited partner units outstanding – diluted
|
|
|
|
||||
Common units
|
63,379
|
|
|
30,598
|
|
||
Subordinated units
|
—
|
|
|
17,340
|
|
||
Total
|
63,379
|
|
|
47,938
|
|
||
|
|
|
|
||||
Net income per limited partner unit – basic
|
|
|
|
||||
Common units
|
$
|
1.18
|
|
|
$
|
0.69
|
|
Subordinated units
|
—
|
|
|
0.69
|
|
||
Total
|
$
|
1.18
|
|
|
$
|
0.69
|
|
|
|
|
|
||||
Net income per limited partner unit – diluted
|
|
|
|
||||
Common units
|
$
|
1.18
|
|
|
$
|
0.69
|
|
Subordinated units
|
—
|
|
|
0.69
|
|
||
Total
|
$
|
1.18
|
|
|
$
|
0.69
|
|
|
|
Three Months Ended March 31,
|
|||||||||
|
|
2015
|
|
2014
|
|
% Change
|
|||||
FINANCIAL DATA
|
|
(Thousands, other than per day amounts)
|
|||||||||
Firm reservation fee revenues
|
|
$
|
68,183
|
|
|
$
|
47,997
|
|
|
42.1
|
|
Volumetric based fee revenues:
|
|
|
|
|
|
|
|||||
Usage fees under firm contracts
(1)
|
|
8,933
|
|
|
9,025
|
|
|
(1.0
|
)
|
||
Usage fees under interruptible contracts
|
|
2,245
|
|
|
2,295
|
|
|
(2.2
|
)
|
||
Total volumetric based fee revenues
|
|
11,178
|
|
|
11,320
|
|
|
(1.3
|
)
|
||
Total operating revenues
|
|
79,361
|
|
|
59,317
|
|
|
33.8
|
|
||
Operating expenses:
|
|
|
|
|
|
|
|||||
Operating and maintenance
|
|
7,256
|
|
|
5,158
|
|
|
40.7
|
|
||
Selling, general and administrative
|
|
8,047
|
|
|
5,963
|
|
|
34.9
|
|
||
Depreciation and amortization
|
|
6,768
|
|
|
6,159
|
|
|
9.9
|
|
||
Total operating expenses
|
|
22,071
|
|
|
17,280
|
|
|
27.7
|
|
||
Operating income
|
|
$
|
57,290
|
|
|
$
|
42,037
|
|
|
36.3
|
|
|
|
|
|
|
|
|
|||||
OPERATIONAL DATA
|
|
|
|
|
|
|
|
|
|
||
Transmission pipeline throughput (BBtu per day)
|
|
|
|
|
|
|
|||||
Firm capacity reservation
|
|
2,025
|
|
|
1,338
|
|
|
51.3
|
|
||
Volumetric based services
(2)
|
|
213
|
|
|
262
|
|
|
(18.7
|
)
|
||
Total transmission pipeline throughput
|
|
2,238
|
|
1,600
|
|
39.9
|
|
||||
|
|
|
|
|
|
|
|||||
Contracted firm transmission reservation commitments (BBtu per day)
|
|
2,947
|
|
|
2,004
|
|
|
47.1
|
|
||
|
|
|
|
|
|
|
|||||
Capital expenditures
|
|
$
|
21,462
|
|
|
$
|
14,001
|
|
|
53.3
|
|
|
|
Three Months Ended March 31,
|
|||||||||
|
|
2015
|
|
2014
|
|
% Change
|
|||||
FINANCIAL DATA
|
|
(Thousands, other than per day amounts)
|
|||||||||
Firm reservation fee revenues
|
|
$
|
54,258
|
|
|
$
|
—
|
|
|
N/A
|
|
Volumetric based fee revenues:
|
|
|
|
|
|
|
|||||
Usage fees under firm contracts
(1)
|
|
9,432
|
|
|
—
|
|
|
N/A
|
|
||
Usage fees under interruptible contracts
|
|
11,760
|
|
|
48,591
|
|
|
(75.8
|
)
|
||
Total volumetric based fee revenues
|
|
21,192
|
|
|
48,591
|
|
|
(56.4
|
)
|
||
Total operating revenues
|
|
75,450
|
|
|
48,591
|
|
|
55.3
|
|
||
Operating expenses:
|
|
|
|
|
|
|
|||||
Operating and maintenance
|
|
7,223
|
|
|
7,581
|
|
|
(4.7
|
)
|
||
Selling, general and administrative
|
|
7,606
|
|
|
6,592
|
|
|
15.4
|
|
||
Depreciation and amortization
|
|
5,159
|
|
|
3,838
|
|
|
34.4
|
|
||
Total operating expenses
|
|
19,988
|
|
|
18,011
|
|
|
11.0
|
|
||
Operating income
|
|
$
|
55,462
|
|
|
$
|
30,580
|
|
|
81.4
|
|
|
|
|
|
|
|
|
|||||
OPERATIONAL DATA
|
|
|
|
|
|
|
|
|
|
||
Gathering volumes (BBtu per day)
|
|
|
|
|
|
|
|||||
Firm reservation
|
|
1,046
|
|
|
—
|
|
|
N/A
|
|
||
Volumetric based services
(2)
|
|
441
|
|
|
954
|
|
|
(53.8
|
)
|
||
Total gathered volumes
|
|
1,487
|
|
954
|
|
55.9
|
|
||||
|
|
|
|
|
|
|
|||||
Capital expenditures
|
|
$
|
36,269
|
|
|
$
|
34,449
|
|
|
5.3
|
|
•
|
the Partnership’s operating performance as compared to other publicly traded partnerships in the midstream energy industry without regard to historical cost basis or, in the case of adjusted EBITDA, financing methods;
|
•
|
the ability of the Partnership’s assets to generate sufficient cash flow to make distributions to the Partnership’s unitholders;
|
•
|
the Partnership’s ability to incur and service debt and fund capital expenditures; and
|
•
|
the viability of acquisitions and other capital expenditure projects and the returns on investment of various investment opportunities.
|
|
|
Three Months Ended
March 31, |
||||||
|
|
2015
|
|
2014
|
||||
|
|
(Thousands)
|
||||||
Net income
|
|
$
|
95,306
|
|
|
$
|
54,998
|
|
Add:
|
|
|
|
|
||||
Interest expense
|
|
11,457
|
|
|
5,655
|
|
||
Depreciation and amortization expense
|
|
11,927
|
|
|
9,997
|
|
||
Income tax expense
|
|
6,703
|
|
|
12,233
|
|
||
Non-cash long-term compensation expense
|
|
566
|
|
|
978
|
|
||
Less:
|
|
|
|
|
||||
Other income
|
|
(714
|
)
|
|
(269
|
)
|
||
Capital lease payments for AVC
(1)
|
|
(8,844
|
)
|
|
(6,979
|
)
|
||
Adjusted EBITDA attributable to Jupiter prior to acquisition
(2)
|
|
—
|
|
|
(25,237
|
)
|
||
Adjusted EBITDA attributable to NWV Gathering prior to acquisition
(3)
|
|
(19,841
|
)
|
|
(10,287
|
)
|
||
Adjusted EBITDA
|
|
$
|
96,560
|
|
|
$
|
41,089
|
|
Less:
|
|
|
|
|
||||
Interest expense, excluding capital lease interest
|
|
(5,532
|
)
|
|
(717
|
)
|
||
Ongoing maintenance capital expenditures, net of expected reimbursements
(4)
|
|
(1,047
|
)
|
|
(1,481
|
)
|
||
Distributable cash flow
|
|
$
|
89,981
|
|
|
$
|
38,891
|
|
|
|
|
|
|
||||
Net cash provided by operating activities
|
|
$
|
114,659
|
|
|
$
|
47,643
|
|
Adjustments:
|
|
|
|
|
||||
Interest expense
|
|
11,457
|
|
|
5,655
|
|
||
Current tax expense
|
|
3,705
|
|
|
8,739
|
|
||
Capital lease payments for AVC
(1)
|
|
(8,844
|
)
|
|
(6,979
|
)
|
||
Adjusted EBITDA attributable to Jupiter prior to acquisition
(2)
|
|
—
|
|
|
(25,237
|
)
|
||
Adjusted EBITDA attributable to NWV Gathering prior to acquisition
(3)
|
|
(19,841
|
)
|
|
(10,287
|
)
|
||
Other, including changes in working capital
|
|
(4,576
|
)
|
|
21,555
|
|
||
Adjusted EBITDA
|
|
$
|
96,560
|
|
|
$
|
41,089
|
|
(4)
|
For the
three months ended March 31, 2015
, ongoing maintenance capital expenditures, net of expected reimbursements excludes ongoing maintenance of
$0.3 million
attributable to
NWV Gathering
prior to acquisition. Additionally, it excludes
|
•
|
Third-Party Projects
. In 2015, the Partnership expects to invest approximately $25 million to complete a transmission project for Antero Resources (Antero) which is expected to be in service by mid-2015. The Partnership will also invest approximately $40 million in 2015 in gathering infrastructure for third-party producers. This gathering infrastructure will primarily support Range Resources' production development in eastern Washington County, Pennsylvania under an agreement signed in 2014.
|
•
|
Gathering System Expansions
. The Partnership expects capital expenditures of approximately $100 million in 2015 related to expansion in the Jupiter development area that will raise total firm gathering capacity in that area to 775 MMcf per day. The Jupiter expansion is fully subscribed and is expected to be in service by year-end 2015. In addition, the Partnership expects to invest a total of approximately $370 million, of which approximately $65 million is expected to be spent during 2015, related to expansion in the NWV Gathering development area. These expenditures are part of an additional fully subscribed expansion project expected to raise total firm gathering capacity in the NWV Gathering development area to 640 MMcf per day by year-end 2017.
|
•
|
Ohio Valley Connector
. The Ohio Valley Connector (OVC) includes a 36-mile pipeline that will extend the Partnership's transmission and storage system from northern West Virginia to Clarington, Ohio, at which point it will interconnect with the Rockies Express Pipeline and the Texas Eastern Pipeline. The Partnership submitted the OVC certificate application, which also includes related Equitrans transmission expansion projects, to the FERC in December of 2014 and anticipates receiving the certificate in the second half of 2015. Subject to FERC approval, construction is scheduled to begin in the third quarter of 2015 and the pipeline is expected to be in-service by mid-year 2016. The OVC will provide approximately 850 BBtu per day of transmission capacity and the greenfield portion is estimated to cost approximately $300 million, of which $120 million to $130 million is expected to be spent in 2015. The Partnership has entered into a 20-year precedent agreement for a total of 650 BBtu per day of firm transmission capacity on the OVC.
|
•
|
Transmission Expansion Projects
. The Partnership also plans to begin several multi-year transmission expansion projects to support the continued growth of the Marcellus and Utica development. The projects may include pipeline looping, compression installation and new pipeline segments, which combined are expected to increase transmission capacity by approximately 1.0 Bcf per day by year-end 2017. The Partnership expects to invest a total of approximately $400 million, of which approximately $25 million is expected to be spent during 2015.
|
•
|
Mountain Valley Pipeline
. On March 30, 2015, the Partnership assumed EQT's 55% interest in the MVP Joint Venture, a joint venture with affiliates of each of NextEra Energy, Inc., WGL Holdings, Inc. and Vega Energy Partners, Ltd. The Partnership also assumed the role of operator of the Mountain Valley Pipeline (MVP) to be
|
|
Three Months Ended March 31,
|
||||||
|
2015
|
|
2014
|
||||
|
(Thousands)
|
||||||
Expansion capital expenditures
|
$
|
55,494
|
|
|
$
|
46,306
|
|
Maintenance capital expenditures:
|
|
|
|
||||
Ongoing maintenance
|
1,597
|
|
|
1,579
|
|
||
Funded regulatory compliance
|
640
|
|
|
565
|
|
||
Total maintenance capital expenditures
|
2,237
|
|
|
2,144
|
|
||
Total capital expenditures
(1)
|
$
|
57,731
|
|
|
$
|
48,450
|
|
Rating Service
|
|
Senior Notes
|
|
Outlook
|
Moody’s Investors Service
|
|
Ba1
|
|
Stable
|
Standard & Poor’s Ratings Services
|
|
BBB-
|
|
Stable
|
Fitch Ratings
|
|
BBB-
|
|
Stable
|
2.1
|
|
|
Contribution and Sale Agreement, dated March 10, 2015, by and among EQT Gathering, LLC, EQT Energy Supply Holdings, LP, EQT Energy, LLC, EQT Midstream Partners, LP, EQT Midstream Services, LLC, EQM Gathering Opco, LLC and EQT Corporation. EQT Midstream Partners, LP will furnish supplementally a copy of any omitted schedule and similar attachment to the Securities and Exchange Commission upon request.
|
10.1
|
|
|
Amendment No. 1 to Omnibus Agreement, effective as of January 1, 2015, by and among EQT Midstream Partners, LP, EQT Midstream Services, LLC and EQT Corporation.
|
10.2
|
|
|
Second Amended and Restated Limited Liability Company Agreement of Mountain Valley Pipeline, LLC, dated March 10, 2015, by and among MVP Holdco, LLC, US Marcellus Gas Infrastructure, LLC, WGL Midstream, Inc., Vega Midstream MVP LLC, VED NPI IV, LLC and Mountain Valley Pipeline, LLC. Specific items in this exhibit have been redacted, as marked by three asterisks [***], because confidential treatment for those terms has been requested. The redacted material has been separately filed with the Securities and Exchange Commission.
|
10.3
|
|
|
Assignment and Assumption Agreement, dated March 30, 2015, by and among EQT Gathering, LLC, EQT Midstream Partners, LP and MVP Holdco, LLC.
|
10.4
|
|
|
Gas Gathering Agreement for the Mercury, Pandora, Pluto and Saturn Gas Gathering Systems, effective as of March 1, 2015, by and among EQT Production Company and EQT Energy, LLC, on the one hand, and EQM Gathering Opco, LLC (as assignee of EQT Gathering, LLC), on the other hand. Specific items in this exhibit have been redacted, as marked by three asterisks [***], because confidential treatment for those terms has been requested. The redacted material has been separately filed with the Securities and Exchange Commission.
|
10.5
|
|
|
Gas Gathering Agreement for the WG-100 Gas Gathering System, effective as of March 1, 2015, by and among EQT Production Company and EQT Energy, LLC, on the one hand, and EQM Gathering Opco, LLC (as assignee of EQT Gathering, LLC), on the other hand. Specific items in this exhibit have been redacted, as marked by three asterisks [***], because confidential treatment for those terms has been requested. The redacted material has been separately filed with the Securities and Exchange Commission.
|
31.1
|
|
|
Rule 13(a)-14(a) Certification of Principal Executive Officer
|
31.2
|
|
|
Rule 13(a)-14(a) Certification of Principal Financial Officer
|
32
|
|
|
Section 1350 Certification of Principal Executive Officer and Principal Financial Officer
|
101
|
|
|
Interactive Data File
|
|
EQT Midstream Partners, LP
|
|
|
|
(Registrant)
|
|
|
|
|
|
|
|
By:
|
EQT Midstream Services, LLC, its General Partner
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By:
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/s/ Philip P. Conti
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Philip P. Conti
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Senior Vice President and Chief Financial Officer
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Exhibit No.
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Document Description
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Method of Filing
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2.1
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Contribution and Sale Agreement, dated March 10, 2015, by and among EQT Gathering, LLC, EQT Energy Supply Holdings, LP, EQT Energy, LLC, EQT Midstream Partners, LP, EQT Midstream Services, LLC, EQM Gathering Opco, LLC and EQT Corporation. EQT Midstream Partners, LP will furnish supplementally a copy of any omitted schedule and similar attachment to the Securities and Exchange Commission upon request.
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Filed as Exhibit 2.1 to Form 8-K (#001-35574) filed March 10, 2015 which is incorporated herein by reference.
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10.1
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Amendment No. 1 to Omnibus Agreement, effective as of January 1, 2015, by and among EQT Midstream Partners, LP, EQT Midstream Services, LLC and EQT Corporation.
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Filed as Exhibit 10.1 to Form 8-K (#001-35574) filed on March 17, 2015 which is incorporated herein by reference.
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10.2
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Second Amended and Restated Limited Liability Company Agreement of Mountain Valley Pipeline, LLC, dated March 10, 2015, by and among MVP Holdco, LLC, US Marcellus Gas Infrastructure, LLC, WGL Midstream, Inc., Vega Midstream MVP LLC, VED NPI IV, LLC and Mountain Valley Pipeline, LLC. Specific items in this exhibit have been redacted, as marked by three asterisks [***], because confidential treatment for those terms has been requested. The redacted material has been separately filed with the Securities and Exchange Commission.
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Filed as Exhibit 10.1 to Form 8-K (#001-35574) filed on March 31, 2015 which is incorporated herein by reference.
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10.3
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Assignment and Assumption Agreement, dated March 30, 2015, by and among EQT Gathering, LLC, EQT Midstream Partners, LP and MVP Holdco, LLC.
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Filed herewith as Exhibit 10.3.
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10.4
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Gas Gathering Agreement for the Mercury, Pandora, Pluto and Saturn Gas Gathering Systems, effective as of March 1, 2015, by and among EQT Production Company and EQT Energy, LLC, on the one hand, and EQM Gathering Opco, LLC (as assignee of EQT Gathering, LLC), on the other hand. Specific items in this exhibit have been redacted, as marked by three asterisks [***], because confidential treatment for those terms has been requested. The redacted material has been separately filed with the Securities and Exchange Commission.
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Filed as Exhibit 10.2 to Form 8-K (#001-35574) filed on March 31, 2015 which is incorporated herein by reference.
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10.5
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Gas Gathering Agreement for the WG-100 Gas Gathering System, effective as of March 1, 2015, by and among EQT Production Company and EQT Energy, LLC, on the one hand, and EQM Gathering Opco, LLC (as assignee of EQT Gathering, LLC), on the other hand. Specific items in this exhibit have been redacted, as marked by three asterisks [***], because confidential treatment for those terms has been requested. The redacted material has been separately filed with the Securities and Exchange Commission.
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Filed as Exhibit 10.3 to Form 8-K (#001-35574) filed on March 31, 2015 which is incorporated herein by reference.
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31.1
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Rule 13(a)-14(a) Certification of Principal Executive Officer
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Filed herewith as Exhibit 31.1
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31.2
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Rule 13(a)-14(a) Certification of Principal Financial Officer
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Filed herewith as Exhibit 31.2
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32
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Section 1350 Certification of Principal Executive Officer and Principal Financial Officer
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Filed herewith as Exhibit 32
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101
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Interactive Data File
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Filed herewith as Exhibit 101
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EQT Midstream Partners, LP
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/s/ David L. Porges
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David L. Porges
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Chairman, President and Chief Executive Officer, EQT Midstream Services, LLC, the registrant’s General Partner
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EQT Midstream Partners, LP
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/s/ Philip P. Conti
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Philip P. Conti
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Senior Vice President and Chief Financial Officer, EQT Midstream Services, LLC, the registrant’s General Partner
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/s/ David L. Porges
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April 23, 2015
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David L. Porges
Chairman, President and Chief Executive Officer, EQT Midstream Services, LLC, the Partnership’s General Partner
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/s/ Philip P. Conti
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April 23, 2015
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Philip P. Conti
Senior Vice President and Chief Financial Officer, EQT Midstream Services, LLC, the Partnership’s General Partner
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