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Delaware
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72-1252419
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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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þ
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Accelerated filer
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¨
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Non-accelerated filer
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¨
(Do not check if a smaller reporting company)
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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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Page
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•
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our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and any amendments to those reports as soon as reasonably practicable after we electronically file that material with or furnish it to the SEC;
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•
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press releases on quarterly distributions, quarterly earnings, and other developments;
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•
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governance information, including our governance guidelines, committee charters, and code of ethics and business conduct;
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•
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information on events and presentations, including an archive of available calls, webcasts, and presentations;
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•
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news and other announcements that we may post from time to time that investors may find useful or interesting; and
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•
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opportunities to sign up for email alerts and RSS feeds to have information pushed in real time.
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2015 Term Loan Agreement.
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$450 million unsecured term loan agreement.
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2019 Notes.
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$500 million aggregate principal amount of the Partnership’s 2.400% senior notes due 2019.
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2024 Notes.
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$600 million aggregate principal amount of the Partnership’s 3.900% senior notes due 2024.
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2027 Notes.
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$700 million aggregate principal amount of the Partnership’s 4.400% senior notes due 2027.
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2044 Notes.
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$550 million aggregate principal amount of the Partnership’s 5.000% senior notes due 2044.
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Adjusted EBITDA.
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A non-GAAP measure calculated as net income attributable to limited partners plus depreciation and amortization expense, interest expense, net of interest income, income tax expense, distributions received from equity method affiliate in excess of equity earnings, non-cash equity-based compensation, changes in fair value of derivatives, certain other non-cash gains and losses (including gains and losses on sales of assets and write-downs of materials and supplies) and impairments, less the noncontrolling interest allocable to Adjusted EBITDA.
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Adjusted interest expense.
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A non-GAAP measure calculated as interest expense plus amortization of premium on long-term debt and capitalized interest on expansion capital, less amortization of debt costs and discount on long-term debt.
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Annual Report.
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Annual Report on Form 10-K for the year ended December 31, 2017.
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ArcLight.
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ArcLight Capital Partners, LLC, a Delaware limited liability company, its affiliated entities ArcLight Energy Partners Fund V, L.P., ArcLight Energy Partners Fund IV, L.P., Bronco Midstream Partners, L.P., Bronco Midstream Infrastructure LLC and Enogex Holdings LLC, and their respective general partners and subsidiaries.
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ASC.
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Accounting Standards Codification.
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ASU.
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Accounting Standards Update.
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ATM Program.
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The offer and sale, from time to time, of common units representing limited partner interest having an aggregate offering price of up to $200 million in quantities, by sales methods and at prices determined by market conditions and other factors at the time of such sales, pursuant to that certain ATM Equity Offering Sales Agreement, entered into on May 12, 2017.
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Barrel.
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42 U.S. gallons of petroleum products.
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Bbl.
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Barrel.
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Bbl/d.
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Barrels per day.
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Bcf/d.
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Billion cubic feet per day.
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Btu.
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British thermal unit. When used in terms of volume, Btu refers to the amount of natural gas required to raise the temperature of one pound of water by one degree Fahrenheit at one atmospheric pressure.
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CenterPoint Energy.
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CenterPoint Energy, Inc., a Texas corporation, and its subsidiaries.
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Condensate.
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A natural gas liquid with a low vapor pressure, mainly composed of propane, butane, pentane and heavier hydrocarbon fractions.
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DCF.
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A non-GAAP measure calculated as Adjusted EBITDA, as further adjusted for Series A Preferred Unit distributions, distributions for phantom and performance units, Adjusted interest expense, maintenance capital expenditures and current income taxes.
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Distribution coverage ratio.
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A non-GAAP measure calculated as DCF divided by distributions related to common and subordinated unitholders.
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DRIP.
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Distribution Reinvestment Plan entered into on June 23, 2016, which offers owners of our common units the ability to purchase additional common units by reinvesting all or a portion of the cash distributions paid to them on their common units.
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EGT.
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Enable Gas Transmission, LLC, a wholly owned subsidiary of the Partnership that operates an approximately 5,900-mile interstate pipeline that provides natural gas transportation and storage services to customers principally in the Anadarko, Arkoma and Ark-La-Tex Basins in Oklahoma, Texas, Arkansas, Louisiana and Kansas.
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Enable GP.
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Enable GP, LLC, a Delaware limited liability company and the general partner of Enable Midstream Partners, LP.
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EOIT.
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Enable Oklahoma Intrastate Transmission, LLC, formerly Enogex LLC, a wholly owned subsidiary of the Partnership that operates an approximately 2,200-mile intrastate pipeline that provides natural gas transportation and storage services to customers in Oklahoma.
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EOIT Senior Notes.
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$250 million 6.25% senior notes due 2020.
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Exchange Act.
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Securities Exchange Act of 1934, as amended.
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•
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changes in general economic conditions;
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•
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competitive conditions in our industry;
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•
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actions taken by our customers and competitors;
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•
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the supply and demand for natural gas, NGLs, crude oil and midstream services;
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•
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our ability to successfully implement our business plan;
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•
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our ability to complete internal growth projects on time and on budget;
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•
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the price and availability of debt and equity financing;
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•
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strategic decisions by CenterPoint Energy and OGE Energy regarding their ownership of us and Enable GP;
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•
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operating hazards and other risks incidental to transporting, storing, gathering and processing natural gas, NGLs, crude oil and midstream products;
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•
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natural disasters, weather-related delays, casualty losses and other matters beyond our control;
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•
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interest rates;
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•
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labor relations;
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•
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large customer defaults;
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•
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changes in the availability and cost of capital;
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•
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changes in tax status;
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•
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the effects of existing and future laws and governmental regulations;
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•
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changes in insurance markets impacting costs and the level and types of coverage available;
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•
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the timing and extent of changes in commodity prices;
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•
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the suspension, reduction or termination of our customers’ obligations under our commercial agreements;
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•
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disruptions due to equipment interruption or failure at our facilities, or third-party facilities on which our business is dependent;
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•
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the effects of future litigation; and
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•
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other factors set forth in this report and our other filings with the SEC, including our Annual Report.
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Three Months Ended March 31,
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||||||
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2018
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2017
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||||
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(In millions, except per unit data)
|
||||||
Revenues (including revenues from affiliates (Note 12)):
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|
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Product sales
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$
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443
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$
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386
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Service revenues
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305
|
|
|
280
|
|
||
Total Revenues
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748
|
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|
666
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Cost and Expenses (including expenses from affiliates (Note 12)):
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|
|||
Cost of natural gas and natural gas liquids (excluding depreciation and amortization shown separately)
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375
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|
308
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||
Operation and maintenance
|
94
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|
|
89
|
|
||
General and administrative
|
27
|
|
|
25
|
|
||
Depreciation and amortization
|
96
|
|
|
88
|
|
||
Taxes other than income tax
|
17
|
|
|
16
|
|
||
Total Cost and Expenses
|
609
|
|
|
526
|
|
||
Operating Income
|
139
|
|
|
140
|
|
||
Other Income (Expense):
|
|
|
|
||||
Interest expense
|
(33
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)
|
|
(27
|
)
|
||
Equity in earnings of equity method affiliate
|
6
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|
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7
|
|
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Other, net
|
2
|
|
|
1
|
|
||
Total Other Expense
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(25
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)
|
|
(19
|
)
|
||
Income Before Income Tax
|
114
|
|
|
121
|
|
||
Income tax expense
|
—
|
|
|
1
|
|
||
Net Income
|
$
|
114
|
|
|
$
|
120
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Less: Net income attributable to noncontrolling interest
|
—
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|
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—
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|
||
Net Income Attributable to Limited Partners
|
$
|
114
|
|
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$
|
120
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Less: Series A Preferred Unit distributions (Note 6)
|
9
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|
|
9
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|
||
Net Income Attributable to Common and Subordinated Units (Note 5)
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$
|
105
|
|
|
$
|
111
|
|
|
|
|
|
|
|
||
Basic earnings per unit (Note 5)
|
|
|
|
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|
||
Common units
|
$
|
0.24
|
|
|
$
|
0.26
|
|
Subordinated units
|
$
|
—
|
|
|
$
|
0.25
|
|
Diluted earnings per unit (Note 5)
|
|
|
|
||||
Common units
|
$
|
0.24
|
|
|
$
|
0.26
|
|
Subordinated units
|
$
|
—
|
|
|
$
|
0.25
|
|
|
March 31,
2018 |
|
December 31,
2017 |
||||
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(In millions)
|
||||||
Current Assets:
|
|
||||||
Cash and cash equivalents
|
$
|
30
|
|
|
$
|
5
|
|
Restricted cash
|
14
|
|
|
14
|
|
||
Accounts receivable, net of allowance for doubtful accounts
|
253
|
|
|
277
|
|
||
Accounts receivable—affiliated companies
|
19
|
|
|
18
|
|
||
Inventory
|
39
|
|
|
40
|
|
||
Gas imbalances
|
35
|
|
|
37
|
|
||
Other current assets
|
23
|
|
|
25
|
|
||
Total current assets
|
413
|
|
|
416
|
|
||
Property, Plant and Equipment:
|
|
|
|
||||
Property, plant and equipment
|
12,273
|
|
|
12,079
|
|
||
Less accumulated depreciation and amortization
|
1,805
|
|
|
1,724
|
|
||
Property, plant and equipment, net
|
10,468
|
|
|
10,355
|
|
||
Other Assets:
|
|
|
|
||||
Intangible assets, net
|
440
|
|
|
451
|
|
||
Goodwill
|
12
|
|
|
12
|
|
||
Investment in equity method affiliate
|
317
|
|
|
324
|
|
||
Other
|
37
|
|
|
35
|
|
||
Total other assets
|
806
|
|
|
822
|
|
||
Total Assets
|
$
|
11,687
|
|
|
$
|
11,593
|
|
Current Liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
209
|
|
|
$
|
263
|
|
Accounts payable—affiliated companies
|
5
|
|
|
3
|
|
||
Current portion of long-term debt
|
450
|
|
|
450
|
|
||
Short-term debt
|
595
|
|
|
405
|
|
||
Taxes accrued
|
26
|
|
|
32
|
|
||
Gas imbalances
|
8
|
|
|
12
|
|
||
Other
|
111
|
|
|
114
|
|
||
Total current liabilities
|
1,404
|
|
|
1,279
|
|
||
Other Liabilities:
|
|
|
|
||||
Accumulated deferred income taxes, net
|
6
|
|
|
6
|
|
||
Regulatory liabilities
|
21
|
|
|
21
|
|
||
Other
|
43
|
|
|
38
|
|
||
Total other liabilities
|
70
|
|
|
65
|
|
||
Long-Term Debt
|
2,594
|
|
|
2,595
|
|
||
Commitments and Contingencies (Note 13)
|
|
|
|
||||
Partners’ Equity:
|
|
|
|
||||
Series A Preferred Units (14,520,000 issued and outstanding at March 31, 2018 and December 31, 2017)
|
362
|
|
|
362
|
|
||
Common units (433,072,001 issued and outstanding at March 31, 2018 and 432,584,080 issued and outstanding at December 31, 2017, respectively)
|
7,246
|
|
|
7,280
|
|
||
Noncontrolling interest
|
11
|
|
|
12
|
|
||
Total Partners’ Equity
|
7,619
|
|
|
7,654
|
|
||
Total Liabilities and Partners’ Equity
|
$
|
11,687
|
|
|
$
|
11,593
|
|
|
Three Months Ended March 31,
|
||||||
|
2018
|
|
2017
|
||||
|
(In millions)
|
||||||
Cash Flows from Operating Activities:
|
|
||||||
Net income
|
$
|
114
|
|
|
$
|
120
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
||||
Depreciation and amortization
|
96
|
|
|
88
|
|
||
Deferred income taxes
|
—
|
|
|
1
|
|
||
Loss on sale/retirement of assets
|
1
|
|
|
1
|
|
||
Equity in earnings of equity method affiliate
|
(6
|
)
|
|
(7
|
)
|
||
Return on investment in equity method affiliate
|
6
|
|
|
7
|
|
||
Equity-based compensation
|
5
|
|
|
4
|
|
||
Amortization of debt costs and discount (premium)
|
—
|
|
|
(1
|
)
|
||
Changes in other assets and liabilities:
|
|
|
|
||||
Accounts receivable, net
|
24
|
|
|
18
|
|
||
Accounts receivable—affiliated companies
|
(1
|
)
|
|
(8
|
)
|
||
Inventory
|
1
|
|
|
1
|
|
||
Gas imbalance assets
|
2
|
|
|
17
|
|
||
Other current assets
|
(4
|
)
|
|
1
|
|
||
Other assets
|
(3
|
)
|
|
2
|
|
||
Accounts payable
|
(62
|
)
|
|
(55
|
)
|
||
Accounts payable—affiliated companies
|
2
|
|
|
—
|
|
||
Gas imbalance liabilities
|
(4
|
)
|
|
(17
|
)
|
||
Other current liabilities
|
(6
|
)
|
|
(16
|
)
|
||
Other liabilities
|
1
|
|
|
—
|
|
||
Net cash provided by operating activities
|
166
|
|
|
156
|
|
||
Cash Flows from Investing Activities:
|
|
|
|
||||
Capital expenditures
|
(190
|
)
|
|
(61
|
)
|
||
Proceeds from sale of assets
|
7
|
|
|
1
|
|
||
Return of investment in equity method affiliate
|
7
|
|
|
4
|
|
||
Net cash used in investing activities
|
(176
|
)
|
|
(56
|
)
|
||
Cash Flows from Financing Activities:
|
|
|
|
||||
Proceeds from long term debt, net of issuance costs
|
—
|
|
|
691
|
|
||
Proceeds from revolving credit facility
|
—
|
|
|
264
|
|
||
Repayment of revolving credit facility
|
—
|
|
|
(900
|
)
|
||
Increase in short-term debt
|
190
|
|
|
—
|
|
||
Distributions
|
(150
|
)
|
|
(147
|
)
|
||
Cash taxes paid for employee equity-based compensation
|
(5
|
)
|
|
—
|
|
||
Net cash provided by (used in) financing activities
|
35
|
|
|
(92
|
)
|
||
Net Increase in Cash, Cash Equivalents and Restricted Cash
|
25
|
|
|
8
|
|
||
Cash, Cash Equivalents and Restricted Cash at Beginning of Period
|
19
|
|
|
23
|
|
||
Cash, Cash Equivalents and Restricted Cash at End of Period
|
$
|
44
|
|
|
$
|
31
|
|
|
Series A
Preferred
Units
|
|
Common
Units
|
|
Subordinated
Units
|
|
Noncontrolling
Interest
|
|
Total Partners’
Equity
|
|||||||||||||||||||
|
Units
|
|
Value
|
|
Units
|
|
Value
|
|
Units
|
|
Value
|
|
Value
|
|
Value
|
|||||||||||||
|
(In millions)
|
|||||||||||||||||||||||||||
Balance as of December 31, 2016
|
15
|
|
|
$
|
362
|
|
|
224
|
|
|
$
|
3,737
|
|
|
208
|
|
|
$
|
3,683
|
|
|
$
|
12
|
|
|
$
|
7,794
|
|
Net income
|
—
|
|
|
9
|
|
|
—
|
|
|
58
|
|
|
—
|
|
|
53
|
|
|
—
|
|
|
120
|
|
|||||
Distributions
|
—
|
|
|
(9
|
)
|
|
—
|
|
|
(72
|
)
|
|
—
|
|
|
(66
|
)
|
|
—
|
|
|
(147
|
)
|
|||||
Equity-based compensation, net of units for employee taxes
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|||||
Balance as of March 31, 2017
|
15
|
|
|
$
|
362
|
|
|
224
|
|
|
$
|
3,727
|
|
|
208
|
|
|
$
|
3,670
|
|
|
$
|
12
|
|
|
$
|
7,771
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Balance as of December 31, 2017
|
15
|
|
|
$
|
362
|
|
|
433
|
|
|
$
|
7,280
|
|
|
—
|
|
|
$
|
—
|
|
|
$
|
12
|
|
|
$
|
7,654
|
|
Net income
|
—
|
|
|
9
|
|
|
—
|
|
|
105
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
114
|
|
|||||
Distributions
|
—
|
|
|
(9
|
)
|
|
—
|
|
|
(139
|
)
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
(149
|
)
|
|||||
Equity-based compensation, net of units for employee taxes
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Balance as of March 31, 2018
|
15
|
|
|
$
|
362
|
|
|
433
|
|
|
$
|
7,246
|
|
|
—
|
|
|
$
|
—
|
|
|
$
|
11
|
|
|
$
|
7,619
|
|
|
Three Months Ended March 31, 2018
|
||||||||||||||
|
Gathering and
Processing |
|
Transportation
and Storage |
|
Eliminations
|
|
Total
|
||||||||
|
(In millions)
|
||||||||||||||
Revenues:
|
|
|
|
|
|
|
|
||||||||
Product sales:
|
|
|
|
|
|
|
|
||||||||
Natural gas
|
$
|
106
|
|
|
$
|
131
|
|
|
$
|
(109
|
)
|
|
$
|
128
|
|
Natural gas liquids
|
279
|
|
|
7
|
|
|
(7
|
)
|
|
279
|
|
||||
Condensate
|
36
|
|
|
—
|
|
|
—
|
|
|
36
|
|
||||
Total revenues from natural gas, natural gas liquids, and condensate
|
421
|
|
|
138
|
|
|
(116
|
)
|
|
443
|
|
||||
Gain (loss) on derivative activity
|
(3
|
)
|
|
2
|
|
|
1
|
|
|
—
|
|
||||
Total Product sales
|
$
|
418
|
|
|
$
|
140
|
|
|
$
|
(115
|
)
|
|
$
|
443
|
|
Service revenues:
|
|
|
|
|
|
|
|
||||||||
Demand revenues
|
$
|
50
|
|
|
$
|
120
|
|
|
$
|
—
|
|
|
$
|
170
|
|
Volume-dependent revenues
|
123
|
|
|
19
|
|
|
(7
|
)
|
|
135
|
|
||||
Total Service revenues
|
$
|
173
|
|
|
$
|
139
|
|
|
$
|
(7
|
)
|
|
$
|
305
|
|
Total Revenues
|
$
|
591
|
|
|
$
|
279
|
|
|
$
|
(122
|
)
|
|
$
|
748
|
|
•
|
Under a firm fee arrangement, a customer agrees to pay a fixed fee for a contractually agreed upon pipeline or storage capacity. Once the services have been completed, or the customer no longer has access to the contracted capacity, revenue is recognized.
|
•
|
Under a minimum volume commitment fee arrangement, a customer agrees to either deliver a contractually agreed upon minimum volume of natural gas or crude oil to our system for service at a contractually agreed upon gathering fee or to pay the contractually agreed upon gathering, compressing and treating fees for the minimum volume of natural gas or crude oil irrespective of whether or not the minimum volume of natural gas or crude oil is delivered. Certain of our contracts provide our customers the option to elect to pay a higher gathering fee over the remaining term of the contract in lieu of making a contractually agreed upon shortfall payment. Once the services have been completed, or the customer no longer has the ability to utilize the services, revenue is recognized.
|
|
March 31,
2018 |
|
December 31,
2017 |
||||
|
(In millions)
|
||||||
Accounts Receivable:
|
|
|
|
||||
Customers
|
$
|
233
|
|
|
$
|
265
|
|
Accrued minimum volume commitments (contract assets)
|
34
|
|
|
27
|
|
||
Non-customers
|
5
|
|
|
3
|
|
||
Total Accounts Receivable
(1)
|
$
|
272
|
|
|
$
|
295
|
|
•
|
Under certain firm fee arrangements, customers pay their demand fee prior to the month of contracted capacity. These fees are applied to the subsequent month’s activity and are included in other liabilities on the Condensed Consolidated Balance Sheets.
|
•
|
Under certain demand and volume dependent arrangements, customers make contributions of aid in construction payments. For payments that are related to contracts under ASC 606, the payment is deferred and amortized over the life of the associated contract and the unamortized balance is included in other current or long-term liabilities on the Condensed Consolidated Balance Sheets.
|
|
March 31,
2018 |
|
December 31,
2017 |
|
Amounts recognized in revenues
|
||||||
|
(In millions)
|
||||||||||
Deferred revenues
|
$
|
41
|
|
|
$
|
34
|
|
|
$
|
15
|
|
|
2018
|
|
2019
|
|
2020
|
|
2021
|
|
2022 and After
|
||||||||||
|
(In millions)
|
||||||||||||||||||
Deferred revenues
|
$
|
19
|
|
|
$
|
4
|
|
|
$
|
4
|
|
|
$
|
4
|
|
|
$
|
10
|
|
|
2018
|
|
2019
|
|
2020
|
|
2021
|
|
2022 and After
|
||||||||||
Transportation and Storage
|
$
|
325
|
|
|
$
|
329
|
|
|
$
|
244
|
|
|
$
|
123
|
|
|
$
|
608
|
|
Gathering and Processing
|
175
|
|
|
221
|
|
|
118
|
|
|
94
|
|
|
328
|
|
|||||
Total remaining performance obligations
|
$
|
500
|
|
|
$
|
550
|
|
|
$
|
362
|
|
|
$
|
217
|
|
|
$
|
936
|
|
•
|
Natural gas and natural gas liquids purchase arrangements - For certain arrangements within our gathering and processing segment, the Partnership purchases and controls the entire hydrocarbon stream at the point of receipt. As of January 1, 2018, these arrangements are considered supplier contracts rather than contracts with customers. Therefore, beginning January 1, 2018, the gathering and processing fees for these arrangements that were previously recognized as Service revenues under ASC 605 are recognized as reductions to Cost of natural gas and natural gas liquids.
|
•
|
Percent-of-proceeds and percent-of-liquids processing arrangements - Under percent-of-proceeds and percent-of-liquids arrangements within our gathering and processing segment, the Partnership has previously recognized the value of natural gas and natural gas liquids received in our purchase cost within Cost of natural gas and natural gas liquids. As of January 1, 2018, the Partnership recognizes the value of the natural gas and NGLs received as Service revenues and as an increase to Cost of natural gas and natural gas liquids when the natural gas or NGLs are sold and Product sales are recognized.
|
•
|
Keep-whole arrangements - Under keep-whole arrangements within our gathering and processing segment, the Partnership has previously recognized the value of NGLs received in Product sales and the value of the thermally equivalent quantity of natural gas provided in our purchase cost within Cost of natural gas and natural gas liquids. As of January 1, 2018, the Partnership recognizes the value of the NGLs received less the value of the thermal equivalent volume of natural gas provided as Service revenues and as an increase to Cost of natural gas and natural gas liquids when the NGLs are sold and Product sales are recognized.
|
•
|
Fixed fuel arrangements - Under certain gathering arrangements within our gathering and processing segment as well as under certain transportation arrangements within our transportation and storage segment we receive a fixed amount of fuel regardless of actual fuel usage. Previously, revenue for fuel in excess of actual usage was recognized
|
•
|
Natural gas and natural gas liquids sales arrangements - For certain arrangements within our gathering and processing segment, the Partnership sells the entire hydrocarbon stream at the point of delivery to a third-party processing facility. As of January 1, 2018, these arrangements are considered sales once control has transferred to the third-party processing facility. Therefore, beginning January 1, 2018, the transportation and fractionation fees for these arrangements that were previously recognized as a component of cost of gas and natural gas liquids, are recognized as reductions to the transaction price under ASC 606.
|
|
Three Months Ended March 31, 2018
|
||||||||||
|
Under ASC 606
|
|
Under ASC 605
|
|
Increase/(Decrease)
|
||||||
|
(In millions)
|
||||||||||
Revenues:
|
|
|
|
|
|
||||||
Product sales:
|
|
|
|
|
|
||||||
Natural gas
|
$
|
128
|
|
|
$
|
139
|
|
|
$
|
(11
|
)
|
Natural gas liquids
|
279
|
|
|
283
|
|
|
(4
|
)
|
|||
Condensate
|
36
|
|
|
36
|
|
|
—
|
|
|||
Total revenues from natural gas, natural gas liquids, and condensate
|
443
|
|
|
458
|
|
|
(15
|
)
|
|||
Gain (loss) on derivative activity
|
—
|
|
|
—
|
|
|
—
|
|
|||
Total Product sales
|
$
|
443
|
|
|
$
|
458
|
|
|
$
|
(15
|
)
|
Service revenues:
|
|
|
|
|
|
||||||
Demand revenues
|
$
|
170
|
|
|
$
|
170
|
|
|
—
|
|
|
Volume-dependent revenues
|
135
|
|
|
134
|
|
|
1
|
|
|||
Total Service revenues
|
$
|
305
|
|
|
$
|
304
|
|
|
$
|
1
|
|
Total Revenues
|
$
|
748
|
|
|
$
|
762
|
|
|
$
|
(14
|
)
|
|
Three Months Ended March 31,
|
||||||
|
2018
|
|
2017
|
||||
|
(In millions, except per unit data)
|
||||||
Net income
|
$
|
114
|
|
|
$
|
120
|
|
Net income attributable to noncontrolling interest
|
—
|
|
|
—
|
|
||
Series A Preferred Unit distributions
|
9
|
|
|
9
|
|
||
General partner interest in net income
|
—
|
|
|
—
|
|
||
Net income available to common and subordinated unitholders
|
$
|
105
|
|
|
$
|
111
|
|
|
|
|
|
||||
Net income allocable to common units
|
$
|
105
|
|
|
$
|
58
|
|
Net income allocable to subordinated units
|
—
|
|
|
53
|
|
||
Net income available to common and subordinated unitholders
|
$
|
105
|
|
|
$
|
111
|
|
|
|
|
|
||||
Net income allocable to common units
|
$
|
105
|
|
|
$
|
58
|
|
Dilutive effect of Series A Preferred Unit distributions
|
—
|
|
|
—
|
|
||
Diluted net income allocable to common units
|
105
|
|
|
58
|
|
||
Diluted net income allocable to subordinated units
|
—
|
|
|
53
|
|
||
Total
|
$
|
105
|
|
|
$
|
111
|
|
|
|
|
|
||||
Basic weighted average number of outstanding
|
|
|
|
||||
Common units
(1)
|
434
|
|
|
225
|
|
||
Subordinated units
|
—
|
|
|
208
|
|
||
Total
|
434
|
|
|
433
|
|
||
|
|
|
|
||||
Basic earnings per unit
|
|
|
|
||||
Common units
|
$
|
0.24
|
|
|
$
|
0.26
|
|
Subordinated units
|
$
|
—
|
|
|
$
|
0.25
|
|
|
|
|
|
||||
Basic weighted average number of outstanding common units
|
434
|
|
|
225
|
|
||
Dilutive effect of Series A Preferred Units
|
—
|
|
|
—
|
|
||
Dilutive effect of performance units
|
1
|
|
|
1
|
|
||
Diluted weighted average number of outstanding common units
|
435
|
|
|
226
|
|
||
Diluted weighted average number of outstanding subordinated units
|
—
|
|
|
208
|
|
||
Total
|
435
|
|
|
434
|
|
||
|
|
|
|
||||
Diluted earnings per unit
|
|
|
|
||||
Common units
|
$
|
0.24
|
|
|
$
|
0.26
|
|
Subordinated units
|
$
|
—
|
|
|
$
|
0.25
|
|
(1)
|
Basic weighted average number of outstanding common units for each of the
three
months ended
March 31, 2018
and
2017
includes approximately
one million
time-based phantom units.
|
Three Months Ended
|
|
Record Date
|
|
Payment Date
|
|
Per Unit Distribution
|
|
Total Cash Distribution
|
||||
March 31, 2018
(1)
|
|
May 22, 2018
|
|
May 29, 2018
|
|
$
|
0.318
|
|
|
$
|
138
|
|
December 31, 2017
|
|
February 20, 2018
|
|
February 27, 2018
|
|
$
|
0.318
|
|
|
$
|
138
|
|
September 30, 2017
|
|
November 14, 2017
|
|
November 21, 2017
|
|
$
|
0.318
|
|
|
$
|
138
|
|
June 30, 2017
|
|
August 22, 2017
|
|
August 29, 2017
|
|
$
|
0.318
|
|
|
$
|
138
|
|
March 31, 2017
|
|
May 23, 2017
|
|
May 30, 2017
|
|
$
|
0.318
|
|
|
$
|
137
|
|
December 31, 2016
|
|
February 21, 2017
|
|
February 28, 2017
|
|
$
|
0.318
|
|
|
$
|
137
|
|
(1)
|
The board of directors of Enable GP declared this
0.318
per common unit cash distribution on
May 1, 2018
, to be paid on
May 29, 2018
, to common unitholders of record at the close of business on
May 22, 2018
.
|
Three Months Ended
|
|
Record Date
|
|
Payment Date
|
|
Per Unit Distribution
|
|
Total Cash Distribution
|
||||
March 31, 2018
(1)
|
|
May 1, 2018
|
|
May 15, 2018
|
|
$
|
0.625
|
|
|
$
|
9
|
|
December 31, 2017
|
|
February 9, 2018
|
|
February 15, 2018
|
|
$
|
0.625
|
|
|
$
|
9
|
|
September 30, 2017
|
|
October 31, 2017
|
|
November 14, 2017
|
|
$
|
0.625
|
|
|
$
|
9
|
|
June 30, 2017
|
|
July 31, 2017
|
|
August 14, 2017
|
|
$
|
0.625
|
|
|
$
|
9
|
|
March 31, 2017
|
|
May 2, 2017
|
|
May 12, 2017
|
|
$
|
0.625
|
|
|
$
|
9
|
|
December 31, 2016
|
|
February 10, 2017
|
|
February 15, 2017
|
|
$
|
0.625
|
|
|
$
|
9
|
|
(1)
|
The board of directors of Enable GP declared a
$0.625
per Series A Preferred Unit cash distribution on
May 1, 2018
, to be paid on
May 15, 2018
, to Series A Preferred unitholders of record at the close of business on
May 1, 2018
.
|
•
|
rank senior to the Partnership’s common units with respect to the payment of distributions and distribution of assets upon liquidation, dissolution and winding up;
|
•
|
have no stated maturity;
|
•
|
are not subject to any sinking fund; and
|
•
|
will remain outstanding indefinitely unless repurchased or redeemed by the Partnership or converted into its common units in connection with a change of control.
|
|
Three Months Ended March 31,
|
||||||
|
2018
|
|
2017
|
||||
|
(In millions)
|
||||||
SESH
|
$
|
6
|
|
|
$
|
7
|
|
|
Three Months Ended March 31,
|
||||||
|
2018
|
|
2017
|
||||
|
(In millions)
|
||||||
SESH
(1)
|
$
|
13
|
|
|
$
|
11
|
|
(1)
|
Distributions from equity method affiliate includes a
$6 million
and
$7 million
return on investment and a
$7 million
and
$4 million
return of investment for the
three months ended March 31, 2018
and
2017
, respectively.
|
|
Three Months Ended March 31,
|
||||||
|
2018
|
|
2017
|
||||
|
(In millions)
|
||||||
Income Statements:
|
|
|
|
||||
Revenues
|
$
|
28
|
|
|
$
|
28
|
|
Operating income
|
$
|
17
|
|
|
$
|
17
|
|
Net income
|
$
|
12
|
|
|
$
|
13
|
|
|
March 31, 2018
|
|
December 31, 2017
|
||||||||||||||||||||
|
Outstanding Principal
|
|
Premium (Discount)
|
|
Total Debt
|
|
Outstanding Principal
|
|
Premium (Discount)
|
|
Total Debt
|
||||||||||||
|
(In millions)
|
||||||||||||||||||||||
Commercial Paper
|
$
|
596
|
|
|
$
|
(1
|
)
|
|
$
|
595
|
|
|
$
|
405
|
|
|
$
|
—
|
|
|
$
|
405
|
|
Revolving Credit Facility
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
2015 Term Loan Agreement
|
450
|
|
|
—
|
|
|
450
|
|
|
450
|
|
|
—
|
|
|
450
|
|
||||||
2019 Notes
|
500
|
|
|
—
|
|
|
500
|
|
|
500
|
|
|
—
|
|
|
500
|
|
||||||
2024 Notes
|
600
|
|
|
—
|
|
|
600
|
|
|
600
|
|
|
—
|
|
|
600
|
|
||||||
2027 Notes
|
700
|
|
|
(3
|
)
|
|
697
|
|
|
700
|
|
|
(3
|
)
|
|
697
|
|
||||||
2044 Notes
|
550
|
|
|
—
|
|
|
550
|
|
|
550
|
|
|
—
|
|
|
550
|
|
||||||
EOIT Senior Notes
|
250
|
|
|
11
|
|
|
261
|
|
|
250
|
|
|
13
|
|
|
263
|
|
||||||
Total debt
|
$
|
3,646
|
|
|
$
|
7
|
|
|
$
|
3,653
|
|
|
$
|
3,455
|
|
|
$
|
10
|
|
|
$
|
3,465
|
|
Less: Current portion of long-term debt
|
|
|
|
|
450
|
|
|
|
|
|
|
450
|
|
||||||||||
Less: Short-term debt
(1)
|
|
|
|
|
595
|
|
|
|
|
|
|
405
|
|
||||||||||
Less: Unamortized debt expense
(2)
|
|
|
|
|
14
|
|
|
|
|
|
|
15
|
|
||||||||||
Total long-term debt
|
|
|
|
|
$
|
2,594
|
|
|
|
|
|
|
$
|
2,595
|
|
(1)
|
Short-term debt includes
$596 million
and
$405 million
of outstanding commercial paper as of
March 31, 2018
and
December 31, 2017
, respectively.
|
(2)
|
As of
March 31, 2018
and
December 31, 2017
, there was an additional
$3 million
of unamortized debt expense related to the Revolving Credit Facility included in Other long-term assets, not included above.
|
•
|
NGL put options, NGL futures and swaps, and WTI crude oil futures and swaps for condensate sales are used to manage the Partnership’s NGL and condensate exposure associated with its processing agreements;
|
•
|
natural gas futures and swaps are used to manage the Partnership’s natural gas exposure associated with its gathering, processing and transportation and storage assets; and
|
•
|
natural gas futures and swaps, natural gas options and natural gas commodity purchases and sales are used to manage the Partnership’s natural gas exposure associated with its storage and transportation contracts and asset management activities.
|
|
March 31, 2018
|
|
December 31, 2017
|
||||||||
|
Gross Notional Volume
|
||||||||||
|
Purchases
|
|
Sales
|
|
Purchases
|
|
Sales
|
||||
Natural gas—
TBtu
(1)
|
|
|
|
|
|
|
|
||||
Financial fixed futures/swaps
|
19
|
|
|
22
|
|
|
17
|
|
|
13
|
|
Financial basis futures/swaps
|
27
|
|
|
31
|
|
|
17
|
|
|
17
|
|
Physical purchases/sales
|
—
|
|
|
81
|
|
|
1
|
|
|
37
|
|
Crude oil (for condensate)—
MBbl
(2)
|
|
|
|
|
|
|
|
||||
Financial Futures/swaps
|
—
|
|
|
874
|
|
|
—
|
|
|
564
|
|
Natural gas liquids—
MBbl
(3)
|
|
|
|
|
|
|
|
||||
Financial Futures/swaps
|
—
|
|
|
2,195
|
|
|
—
|
|
|
1,615
|
|
(1)
|
As of
March 31, 2018
,
82.4%
of the natural gas contracts had durations of one year or less,
10.7%
had durations of more than one year and less than two years and
6.9%
had durations of more than two years. As of
December 31, 2017
,
67.7%
of the natural gas contracts had durations of one year or less,
16.1%
had durations of more than one year and less than two years and
16.2%
had durations of more than two years.
|
(2)
|
As of
March 31, 2018
,
69.1%
of the crude oil (for condensate) contracts had durations of one year or less and
30.9%
had durations of more than one year and less than two years. As of
December 31, 2017
,
100%
of the crude oil (for condensate) contracts had durations of one year or less.
|
(3)
|
As of
March 31, 2018
,
72.0%
of the natural gas liquids contracts had durations of one year or less and
28.0%
had durations of more than one year and less than two years. As of
December 31, 2017
,
100%
of the natural gas liquid contracts had durations of one year or less.
|
|
|
|
March 31, 2018
|
|
December 31, 2017
|
||||||||||||
|
|
|
Fair Value
|
||||||||||||||
Instrument
|
Balance Sheet Location
|
|
Assets
|
|
Liabilities
|
|
Assets
|
|
Liabilities
|
||||||||
|
|
|
(In millions)
|
||||||||||||||
Natural gas
|
|
|
|
|
|
|
|
||||||||||
Financial futures/swaps
|
Other Current/Other
|
|
$
|
3
|
|
|
$
|
9
|
|
|
$
|
5
|
|
|
$
|
4
|
|
Physical purchases/sales
|
Other Current/Other
|
|
6
|
|
|
1
|
|
|
3
|
|
|
—
|
|
||||
Crude oil (for condensate)
|
|
|
|
|
|
|
|
|
|
||||||||
Financial futures/swaps
|
Other Current/Other
|
|
—
|
|
|
5
|
|
|
—
|
|
|
4
|
|
||||
Natural gas liquids
|
|
|
|
|
|
|
|
|
|
||||||||
Financial Futures/swaps
|
Other Current/Other
|
|
2
|
|
|
2
|
|
|
1
|
|
|
5
|
|
||||
Total gross derivatives
(1)
|
|
|
$
|
11
|
|
|
$
|
17
|
|
|
$
|
9
|
|
|
$
|
13
|
|
(1)
|
See Note 10 for a reconciliation of the Partnership’s total derivatives fair value to the Partnership’s Condensed Consolidated Balance Sheets as of
March 31, 2018
and
December 31, 2017
.
|
|
Amounts Recognized in Income
|
||||||
|
Three Months Ended March 31,
|
||||||
|
2018
|
|
2017
|
||||
|
(In millions)
|
||||||
Natural gas
|
|
|
|
||||
Financial futures/swaps (losses) gains
|
$
|
(3
|
)
|
|
$
|
11
|
|
Physical purchases/sales gains
|
2
|
|
|
5
|
|
||
Crude oil (for condensate)
|
|
|
|
||||
Financial futures/swaps (losses) gains
|
(3
|
)
|
|
3
|
|
||
Natural gas liquids
|
|
|
|
||||
Financial futures/swaps gains
|
4
|
|
|
2
|
|
||
Total
|
$
|
—
|
|
|
$
|
21
|
|
|
Three Months Ended March 31,
|
||||||
|
2018
|
|
2017
|
||||
|
(In millions)
|
||||||
Change in fair value of derivatives
|
$
|
(2
|
)
|
|
$
|
24
|
|
Realized gain (loss) on derivatives
|
2
|
|
|
(3
|
)
|
||
Gain on derivative activity
|
$
|
—
|
|
|
$
|
21
|
|
|
March 31, 2018
|
|
December 31, 2017
|
||||||||||||
|
Carrying Amount
|
|
Fair Value
|
|
Carrying Amount
|
|
Fair Value
|
||||||||
|
(In millions)
|
||||||||||||||
Debt
|
|
|
|
|
|
|
|
||||||||
Revolving Credit Facility (Level 2)
(1)
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
2015 Term Loan Agreement (Level 2)
|
450
|
|
|
450
|
|
|
450
|
|
|
450
|
|
||||
2019 Notes (Level 2)
|
500
|
|
|
494
|
|
|
500
|
|
|
497
|
|
||||
2024 Notes (Level 2)
|
600
|
|
|
588
|
|
|
600
|
|
|
602
|
|
||||
2027 Notes (Level 2)
|
697
|
|
|
687
|
|
|
697
|
|
|
712
|
|
||||
2044 Notes (Level 2)
|
550
|
|
|
523
|
|
|
550
|
|
|
550
|
|
||||
EOIT Senior Notes (Level 2)
|
261
|
|
|
261
|
|
|
263
|
|
|
265
|
|
(1)
|
Borrowing capacity is effectively reduced by our borrowings outstanding under the commercial paper program.
$596 million
and
$405 million
of commercial paper was outstanding as of
March 31, 2018
and
December 31, 2017
, respectively.
|
March 31, 2018
|
Commodity Contracts
|
|
Gas Imbalances
(1)
|
||||||||||||
|
Assets
|
|
Liabilities
|
|
Assets
(2)
|
|
Liabilities
(3)
|
||||||||
|
(In millions)
|
||||||||||||||
Quoted market prices in active market for identical assets (Level 1)
|
$
|
3
|
|
|
$
|
7
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Significant other observable inputs (Level 2)
|
6
|
|
|
8
|
|
|
19
|
|
|
8
|
|
||||
Unobservable inputs (Level 3)
|
2
|
|
|
2
|
|
|
—
|
|
|
—
|
|
||||
Total fair value
|
11
|
|
|
17
|
|
|
19
|
|
|
8
|
|
||||
Netting adjustments
|
(3
|
)
|
|
(3
|
)
|
|
—
|
|
|
—
|
|
||||
Total
|
$
|
8
|
|
|
$
|
14
|
|
|
$
|
19
|
|
|
$
|
8
|
|
December 31, 2017
|
Commodity Contracts
|
|
Gas Imbalances
(1)
|
||||||||||||
|
Assets
|
|
Liabilities
|
|
Assets
(2)
|
|
Liabilities
(3)
|
||||||||
|
(In millions)
|
||||||||||||||
Quoted market prices in active market for identical assets (Level 1)
|
$
|
5
|
|
|
$
|
3
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Significant other observable inputs (Level 2)
|
4
|
|
|
5
|
|
|
27
|
|
|
12
|
|
||||
Unobservable inputs (Level 3)
|
—
|
|
|
5
|
|
|
—
|
|
|
—
|
|
||||
Total fair value
|
9
|
|
|
13
|
|
|
27
|
|
|
12
|
|
||||
Netting adjustments
|
(5
|
)
|
|
(5
|
)
|
|
—
|
|
|
—
|
|
||||
Total
|
$
|
4
|
|
|
$
|
8
|
|
|
$
|
27
|
|
|
$
|
12
|
|
(1)
|
The Partnership uses the market approach to fair value its gas imbalance assets and liabilities at individual, or where appropriate an average of, current market indices applicable to the Partnership’s operations, not to exceed net realizable value. Gas imbalances held by EOIT are valued using an average of the Inside FERC Gas Market Report for Panhandle Eastern Pipe Line Co. (Texas, Oklahoma Mainline), ONEOK (Oklahoma) and ANR Pipeline (Oklahoma) indices. There were no netting adjustments as of
March 31, 2018
and
December 31, 2017
.
|
(2)
|
Gas imbalance assets exclude fuel reserves for under retained fuel due from shippers of
$16 million
and
$10 million
at
March 31, 2018
and
December 31, 2017
, respectively, which fuel reserves are based on the value of natural gas at the time the imbalance was created and which are not subject to revaluation at fair market value.
|
(3)
|
Gas imbalance liabilities exclude fuel reserves for over retained fuel due to shippers of
zero
at
March 31, 2018
and
December 31, 2017
, which fuel reserves are based on the value of natural gas at the time the imbalance was created and which are not subject to revaluation at fair market value.
|
|
Commodity Contracts
|
||
|
Natural gas liquids
financial futures/swaps
|
||
|
(In millions)
|
||
Balance at December 31, 2017
|
$
|
(5
|
)
|
Gains included in earnings
|
4
|
|
|
Settlements
|
1
|
|
|
Transfers out of Level 3
|
—
|
|
|
Balance as of March 31, 2018
|
$
|
—
|
|
|
March 31, 2018
|
||||
Product Group
|
Fair Value
|
|
Forward Curve Range
|
||
|
(In millions)
|
|
(Per gallon)
|
||
Natural gas liquids
|
$
|
—
|
|
|
$0.2663 - $0.8963
|
|
Three Months Ended March 31,
|
||||||
|
2018
|
|
2017
|
||||
|
(In millions)
|
||||||
Supplemental Disclosure of Cash Flow Information:
|
|
|
|
||||
Cash Payments:
|
|
|
|
||||
Interest, net of capitalized interest
|
$
|
29
|
|
|
$
|
14
|
|
Income taxes, net of refunds
|
2
|
|
|
—
|
|
||
Non-cash transactions:
|
|
|
|
||||
Accounts payable related to capital expenditures
|
50
|
|
|
20
|
|
|
Three Months Ended March 31,
|
||||||
|
2018
|
|
2017
|
||||
|
(In millions)
|
||||||
Cash and cash equivalents
|
$
|
30
|
|
|
$
|
17
|
|
Restricted cash
|
14
|
|
|
14
|
|
||
Cash, cash equivalents and restricted cash shown in the Condensed Consolidated Statements of Cash Flows
|
$
|
44
|
|
|
$
|
31
|
|
|
Three Months Ended March 31,
|
||||||
|
2018
|
|
2017
|
||||
|
(In millions)
|
||||||
Gas transportation and storage service revenue — CenterPoint Energy
|
$
|
33
|
|
|
$
|
33
|
|
Natural gas product sales — CenterPoint Energy
|
6
|
|
|
—
|
|
||
Gas transportation and storage service revenue — OGE Energy
|
9
|
|
|
9
|
|
||
Natural gas product sales — OGE Energy
|
1
|
|
|
—
|
|
||
Total revenues — affiliated companies
|
$
|
49
|
|
|
$
|
42
|
|
|
Three Months Ended March 31,
|
||||||
|
2018
|
|
2017
|
||||
|
(In millions)
|
||||||
Cost of natural gas purchases — CenterPoint Energy
|
$
|
2
|
|
|
$
|
—
|
|
Cost of natural gas purchases — OGE Energy
|
3
|
|
|
3
|
|
||
Total cost of natural gas purchases — affiliated companies
|
$
|
5
|
|
|
$
|
3
|
|
|
Three Months Ended March 31,
|
||||||
|
2018
|
|
2017
|
||||
|
(In millions)
|
||||||
Corporate Services — CenterPoint Energy
|
$
|
1
|
|
|
$
|
1
|
|
Operating Lease — CenterPoint Energy
|
—
|
|
|
—
|
|
||
Seconded Employee Costs — OGE Energy
|
8
|
|
|
7
|
|
||
Corporate Services — OGE Energy
|
—
|
|
|
1
|
|
||
Total corporate services and seconded employees expense
|
$
|
9
|
|
|
$
|
9
|
|
|
Three Months Ended March 31,
|
||||||
|
2018
|
|
2017
|
||||
|
(In millions)
|
||||||
Performance units
|
$
|
3
|
|
|
$
|
3
|
|
Restricted units
|
1
|
|
|
—
|
|
||
Phantom units
|
1
|
|
|
1
|
|
||
Total compensation expense
|
$
|
5
|
|
|
$
|
4
|
|
|
Performance Units
|
|
Restricted Units
|
|
Phantom Units
|
||||||||||||||||||
|
Number
of Units
|
|
Weighted Average Grant-Date Fair Value, Per Unit
|
|
Number
of Units
|
|
Weighted Average Grant-Date Fair Value, Per Unit
|
|
Number
of Units
|
|
Weighted Average Grant-Date Fair Value, Per Unit
|
||||||||||||
|
(In millions, except unit data)
|
||||||||||||||||||||||
Units Outstanding at December 31, 2017
|
2,040,407
|
|
|
$
|
13.86
|
|
|
222,434
|
|
|
$
|
17.87
|
|
|
987,380
|
|
|
$
|
11.38
|
|
|||
Granted
(1)
|
529,408
|
|
|
17.70
|
|
|
—
|
|
|
—
|
|
|
494,072
|
|
|
14.04
|
|
||||||
Vested
(2)
|
(401,772
|
)
|
|
16.59
|
|
|
(181,068
|
)
|
|
16.75
|
|
|
—
|
|
|
—
|
|
||||||
Forfeited
|
(3,725
|
)
|
|
13.87
|
|
|
(1,366
|
)
|
|
16.75
|
|
|
(7,375
|
)
|
|
11.90
|
|
||||||
Units Outstanding at March 31, 2018
|
2,164,318
|
|
|
$
|
13.95
|
|
|
40,000
|
|
|
$
|
22.96
|
|
|
1,474,077
|
|
|
$
|
12.27
|
|
|||
Aggregate Intrinsic Value of Units Outstanding at March 31, 2018
|
$
|
30
|
|
|
|
|
$
|
1
|
|
|
|
|
$
|
20
|
|
|
|
(1)
|
Performance units represents the target number of performance units granted. The actual number of performance units earned, if any, is dependent upon performance and may range from
zero
percent to
200
percent of the target.
|
(2)
|
Performance units vested as of
March 31, 2018
include
401,772
units from the annual grant, which were approved by the Board of Directors in 2015 and paid out at
200%
, or
803,544
units, based on the level of achievement of a performance goal established by the Board of Directors over the performance period. The Board of Directors approved the accelerated vesting of the 2015 grant from June 1, 2018 to March 1, 2018.
|
|
March 31, 2018
|
||||
|
Unrecognized Compensation Cost
(In millions)
|
|
Weighted Average to be Recognized
(In years)
|
||
Performance Units
|
$
|
19
|
|
|
1.66
|
Restricted Units
|
—
|
|
|
0.22
|
|
Phantom Units
|
12
|
|
|
1.86
|
|
Total
|
$
|
31
|
|
|
|
Three Months Ended March 31, 2018
|
Gathering and
Processing |
|
Transportation
and Storage (1) |
|
Eliminations
|
|
Total
|
||||||||
|
(In millions)
|
||||||||||||||
Product sales
|
$
|
418
|
|
|
$
|
140
|
|
|
$
|
(115
|
)
|
|
$
|
443
|
|
Service revenue
|
173
|
|
|
139
|
|
|
(7
|
)
|
|
305
|
|
||||
Total Revenues
|
591
|
|
|
279
|
|
|
(122
|
)
|
|
748
|
|
||||
Cost of natural gas and natural gas liquids
|
358
|
|
|
139
|
|
|
(122
|
)
|
|
375
|
|
||||
Operation and maintenance, General and administrative
|
76
|
|
|
46
|
|
|
(1
|
)
|
|
121
|
|
||||
Depreciation and amortization
|
62
|
|
|
34
|
|
|
—
|
|
|
96
|
|
||||
Taxes other than income tax
|
10
|
|
|
7
|
|
|
—
|
|
|
17
|
|
||||
Operating income
|
$
|
85
|
|
|
$
|
53
|
|
|
$
|
1
|
|
|
$
|
139
|
|
Capital expenditures
|
$
|
147
|
|
|
$
|
43
|
|
|
$
|
—
|
|
|
$
|
190
|
|
Total assets
|
$
|
9,212
|
|
|
$
|
5,652
|
|
|
$
|
(3,177
|
)
|
|
$
|
11,687
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Three Months Ended March 31, 2017
|
Gathering and
Processing |
|
Transportation and Storage (1) |
|
Eliminations
|
|
Total
|
||||||||
|
(In millions)
|
||||||||||||||
Product sales
|
$
|
351
|
|
|
$
|
153
|
|
|
$
|
(118
|
)
|
|
$
|
386
|
|
Service revenue
|
140
|
|
|
141
|
|
|
(1
|
)
|
|
280
|
|
||||
Total Revenues
|
491
|
|
|
294
|
|
|
(119
|
)
|
|
666
|
|
||||
Cost of natural gas and natural gas liquids
|
286
|
|
|
140
|
|
|
(118
|
)
|
|
308
|
|
||||
Operation and maintenance, General and administrative
|
70
|
|
|
45
|
|
|
(1
|
)
|
|
114
|
|
||||
Depreciation and amortization
|
56
|
|
|
32
|
|
|
—
|
|
|
88
|
|
||||
Taxes other than income tax
|
9
|
|
|
7
|
|
|
—
|
|
|
16
|
|
||||
Operating income
|
$
|
70
|
|
|
$
|
70
|
|
|
$
|
—
|
|
|
$
|
140
|
|
Capital expenditures
|
$
|
51
|
|
|
$
|
10
|
|
|
$
|
—
|
|
|
$
|
61
|
|
Total assets as of December 31, 2017
|
$
|
9,079
|
|
|
$
|
5,616
|
|
|
$
|
(3,102
|
)
|
|
$
|
11,593
|
|
(1)
|
See Note 7 for discussion regarding ownership interests in SESH and related equity earnings included in the transportation and storage segment for the
three
months ended
March 31, 2018
and
2017
.
|
Three Months Ended March 31, 2018
|
Gathering and
Processing |
|
Transportation
and Storage |
|
Eliminations
|
|
Enable
Midstream Partners, LP |
||||||||
|
(In millions)
|
||||||||||||||
Product sales
|
$
|
418
|
|
|
$
|
140
|
|
|
$
|
(115
|
)
|
|
$
|
443
|
|
Service revenue
|
173
|
|
|
139
|
|
|
(7
|
)
|
|
305
|
|
||||
Total Revenues
|
591
|
|
|
279
|
|
|
(122
|
)
|
|
748
|
|
||||
Cost of natural gas and natural gas liquids (excluding depreciation and amortization shown separately)
|
358
|
|
|
139
|
|
|
(122
|
)
|
|
375
|
|
||||
Gross margin
(1)
|
233
|
|
|
140
|
|
|
—
|
|
|
373
|
|
||||
Operation and maintenance, General and administrative
|
76
|
|
|
46
|
|
|
(1
|
)
|
|
121
|
|
||||
Depreciation and amortization
|
62
|
|
|
34
|
|
|
—
|
|
|
96
|
|
||||
Taxes other than income tax
|
10
|
|
|
7
|
|
|
—
|
|
|
17
|
|
||||
Operating income
|
$
|
85
|
|
|
$
|
53
|
|
|
$
|
1
|
|
|
$
|
139
|
|
Equity in earnings of equity method affiliate
|
$
|
—
|
|
|
$
|
6
|
|
|
$
|
—
|
|
|
$
|
6
|
|
Three Months Ended March 31, 2017
|
Gathering and
Processing |
|
Transportation
and Storage |
|
Eliminations
|
|
Enable
Midstream Partners, LP |
||||||||
|
(In millions)
|
||||||||||||||
Product sales
|
$
|
351
|
|
|
$
|
153
|
|
|
$
|
(118
|
)
|
|
$
|
386
|
|
Service revenue
|
140
|
|
|
141
|
|
|
(1
|
)
|
|
280
|
|
||||
Total Revenues
|
491
|
|
|
294
|
|
|
(119
|
)
|
|
666
|
|
||||
Cost of natural gas and natural gas liquids (excluding depreciation and amortization shown separately)
|
286
|
|
|
140
|
|
|
(118
|
)
|
|
308
|
|
||||
Gross margin
(1)
|
205
|
|
|
154
|
|
|
(1
|
)
|
|
358
|
|
||||
Operation and maintenance, General and administrative
|
70
|
|
|
45
|
|
|
(1
|
)
|
|
114
|
|
||||
Depreciation and amortization
|
56
|
|
|
32
|
|
|
—
|
|
|
88
|
|
||||
Taxes other than income tax
|
9
|
|
|
7
|
|
|
—
|
|
|
16
|
|
||||
Operating income
|
$
|
70
|
|
|
$
|
70
|
|
|
$
|
—
|
|
|
$
|
140
|
|
Equity in earnings of equity method affiliate
|
$
|
—
|
|
|
$
|
7
|
|
|
$
|
—
|
|
|
$
|
7
|
|
(1)
|
Gross margin is a non-GAAP measure and is reconciled to its most directly comparable financial measures calculated and presented below under the caption Reconciliations of Non-GAAP Financial Measures.
|
|
Three Months Ended March 31,
|
|||
|
2018
|
|
2017
|
|
Operating Data:
|
|
|||
Gathered volumes—TBtu
|
385
|
|
|
296
|
Gathered volumes—TBtu/d
|
4.28
|
|
|
3.29
|
Natural gas processed volumes—TBtu
|
200
|
|
|
168
|
Natural gas processed volumes—TBtu/d
|
2.22
|
|
|
1.87
|
NGLs produced—MBbl/d
(1)
|
110.29
|
|
|
79.76
|
NGLs sold—MBbl/d
(1)(2)
|
109.39
|
|
|
78.65
|
Condensate sold—MBbl/d
|
6.96
|
|
|
5.47
|
Crude Oil—Gathered volumes—MBbl/d
|
24.83
|
|
|
21.18
|
Transported volumes—TBtu
|
510
|
|
|
493
|
Transported volumes—TBtu/d
|
5.66
|
|
|
5.48
|
Interstate firm contracted capacity—Bcf/d
|
6.05
|
|
|
7.23
|
Intrastate average deliveries—TBtu/d
|
1.97
|
|
|
1.84
|
(1)
|
Excludes condensate.
|
(2)
|
NGLs sold includes volumes of NGLs withdrawn from inventory or purchased for system balancing purposes.
|
|
Three Months Ended March 31,
|
|||
|
2018
|
|
2017
|
|
Anadarko
|
|
|
|
|
Gathered volumes—TBtu/d
|
2.02
|
|
|
1.75
|
Natural gas processed volumes—TBtu/d
|
1.82
|
|
|
1.54
|
NGLs produced—MBbl/d
(1)
|
95.85
|
|
|
67.30
|
Arkoma
|
|
|
|
|
Gathered volumes—TBtu/d
|
0.54
|
|
|
0.57
|
Natural gas processed volumes—TBtu/d
|
0.10
|
|
|
0.10
|
NGLs produced—MBbl/d
(1)
|
4.98
|
|
|
4.85
|
Ark-La-Tex
|
|
|
|
|
Gathered volumes—TBtu/d
|
1.71
|
|
|
0.97
|
Natural gas processed volumes—TBtu/d
|
0.29
|
|
|
0.23
|
NGLs produced—MBbl/d
(1)
|
9.46
|
|
|
7.61
|
(1)
|
Excludes condensate.
|
•
|
revenues from NGL sales increased $89 million resulting from higher average NGL prices and higher processed volumes in the Anadarko and Ark-La-Tex Basins,
|
•
|
natural gas gathering revenues increased $14 million due to higher fees and gathered volumes in the Anadarko and Ark-La-Tex Basins,
|
•
|
processing service revenues increased $13 million resulting from higher processed volumes primarily under fixed processing arrangements,
|
•
|
revenues from natural gas sales increased $3 million due to higher gathered volumes in the Anadarko and Ark-La-Tex Basins as well as higher average natural gas prices, and
|
•
|
crude oil and water gathering revenues increased $1 million due to an increase in gathered volumes.
|
•
|
processing margins increased $19 million from higher average NGL prices and higher processed volumes in the Anadarko and Ark-La-Tex Basin,
|
•
|
natural gas gathering margin increased $15 million due to increased gathered volumes in the Anadarko and Ark-La-Tex Basins, and
|
•
|
crude oil and water gathering margins increased $1 million as a result of an increase in gathered volumes.
|
•
|
changes in the fair value of natural gas derivatives decreased $19 million and
|
•
|
firm transportation services between Carthage, Texas and Perryville, Louisiana decreased $12 million due to contract expirations in the second quarter of 2017.
|
•
|
volume-dependent transportation revenues increased $5 million primarily due to an increase in commodity fees from new contracts and an increase in off-system transportation due to increases in volumes at higher rates,
|
•
|
revenues from natural gas sales increased $3 million due to higher sales volumes and higher average sales prices,
|
•
|
other firm transportation services increased $4 million due to new intrastate transportation contracts,
|
•
|
realized gains on natural gas derivatives increased $4 million, and
|
•
|
revenues from NGL sales increased $1 million due to an increase in prices and volumes.
|
•
|
changes in the fair value of natural gas derivatives decreased $19 million,
|
•
|
firm transportation services of between Carthage, Texas and Perryville, Louisiana decreased $12 million due to contract expirations in the second quarter of 2017, and
|
•
|
storage decreased $6 million primarily due to storage field losses of $3 million and a lower of cost or net realizable value adjustment of $3 million in the first quarter of 2018.
|
•
|
system management activities increased $10 million,
|
•
|
volume-dependent transportation margins increased $5 million primarily due to an increase in commodity fees from new contracts and an increase in off-system transportation due to increases in volumes at higher rates,
|
•
|
other firm transportation services increased $4 million due to new intrastate contracts, and
|
•
|
realized gains on natural gas derivatives increased $4 million.
|
|
Three Months Ended March 31,
|
||||||
|
2018
|
|
2017
|
||||
|
(In millions)
|
||||||
Operating Income
|
$
|
139
|
|
|
$
|
140
|
|
Other Income (Expense):
|
|
|
|
||||
Interest expense
|
(33
|
)
|
|
(27
|
)
|
||
Equity in earnings of equity method affiliate
|
6
|
|
|
7
|
|
||
Other, net
|
2
|
|
|
1
|
|
||
Total Other Expense
|
(25
|
)
|
|
(19
|
)
|
||
Income Before Income Taxes
|
114
|
|
|
121
|
|
||
Income tax expense
|
—
|
|
|
1
|
|
||
Net Income
|
$
|
114
|
|
|
$
|
120
|
|
Less: Net income attributable to noncontrolling interest
|
—
|
|
|
—
|
|
||
Net Income Attributable to Limited Partners
|
$
|
114
|
|
|
$
|
120
|
|
Less: Series A Preferred Unit distributions
|
9
|
|
|
9
|
|
||
Net Income Attributable to Common and Subordinated Units
|
$
|
105
|
|
|
$
|
111
|
|
|
Three Months Ended March 31,
|
||||||
|
2018
|
|
2017
|
||||
|
(In millions)
|
||||||
Reconciliation of Gross margin to Total Revenues:
|
|
|
|
||||
Consolidated
|
|
|
|
||||
Product sales
|
$
|
443
|
|
|
$
|
386
|
|
Service revenue
|
305
|
|
|
280
|
|
||
Total Revenues
|
748
|
|
|
666
|
|
||
Cost of natural gas and natural gas liquids (excluding depreciation and amortization)
|
375
|
|
|
308
|
|
||
Gross margin
|
$
|
373
|
|
|
$
|
358
|
|
|
|
|
|
||||
Reportable Segments
|
|
|
|
||||
Gathering and Processing
|
|
|
|
||||
Product sales
|
$
|
418
|
|
|
$
|
351
|
|
Service revenue
|
173
|
|
|
140
|
|
||
Total Revenues
|
591
|
|
|
491
|
|
||
Cost of natural gas and natural gas liquids (excluding depreciation and amortization)
|
358
|
|
|
286
|
|
||
Gross margin
|
$
|
233
|
|
|
$
|
205
|
|
|
|
|
|
||||
Transportation and Storage
|
|
|
|
||||
Product sales
|
$
|
140
|
|
|
$
|
153
|
|
Service revenue
|
139
|
|
|
141
|
|
||
Total Revenues
|
279
|
|
|
294
|
|
||
Cost of natural gas and natural gas liquids (excluding depreciation and amortization)
|
139
|
|
|
140
|
|
||
Gross margin
|
$
|
140
|
|
|
$
|
154
|
|
|
Fee-Based
(1)
|
|
|
||||||||
|
Demand
|
|
Volume-
Dependent
|
|
Commodity-
Based
(1)
|
|
Total
|
||||
Three Months Ended March 31, 2018
|
|
|
|
|
|
|
|
||||
Gathering and Processing Segment
|
22
|
%
|
|
52
|
%
|
|
26
|
%
|
|
100
|
%
|
Transportation and Storage Segment
|
85
|
%
|
|
14
|
%
|
|
1
|
%
|
|
100
|
%
|
Partnership Weighted Average
|
45
|
%
|
|
38
|
%
|
|
17
|
%
|
|
100
|
%
|
(1)
|
For purposes of this table, the Partnership includes the value of all natural gas and NGL commodities received as payment as commodity-based.
|
|
Three Months Ended March 31,
|
||||||
|
2018
|
|
2017
|
||||
|
(In millions, except Distribution coverage ratio)
|
||||||
Reconciliation of Adjusted EBITDA and DCF to net income attributable to limited partners and calculation of Distribution coverage ratio:
|
|
|
|
||||
Net income attributable to limited partners
|
$
|
114
|
|
|
$
|
120
|
|
Depreciation and amortization expense
|
96
|
|
|
88
|
|
||
Interest expense, net of interest income
|
33
|
|
|
27
|
|
||
Income tax expense
|
—
|
|
|
1
|
|
||
Distributions received from equity method affiliate in excess of equity earnings
|
7
|
|
|
4
|
|
||
Non-cash equity-based compensation
|
5
|
|
|
4
|
|
||
Change in fair value of derivatives
|
2
|
|
|
(24
|
)
|
||
Other non-cash losses
(1)
|
—
|
|
|
1
|
|
||
Adjusted EBITDA
|
$
|
257
|
|
|
$
|
221
|
|
Series A Preferred Unit distributions
(2)
|
(9
|
)
|
|
(9
|
)
|
||
Distributions for phantom and performance units
(3)
|
(3
|
)
|
|
—
|
|
||
Adjusted interest expense
(4)
|
(35
|
)
|
|
(27
|
)
|
||
Maintenance capital expenditures
|
(14
|
)
|
|
(14
|
)
|
||
DCF
|
$
|
196
|
|
|
$
|
171
|
|
|
|
|
|
||||
Distributions related to common and subordinated unitholders
(5)
|
$
|
138
|
|
|
$
|
137
|
|
|
|
|
|
||||
Distribution coverage ratio
|
1.42
|
|
|
1.25
|
|
(1)
|
Other non-cash losses includes loss on sale of assets and write-downs of materials and supplies.
|
(2)
|
This amount represents the quarterly cash distributions on the Series A Preferred Units declared for the three months ended March 31, 2018 and 2017. In accordance with the
Partnership Agreement
, the Series A Preferred Unit distributions are deemed to have been paid out of available cash with respect to the quarter immediately preceding the quarter in which the distribution is made.
|
(3)
|
Distributions for phantom and performance units represent distribution equivalent rights paid in cash. Phantom unit distribution equivalent rights are paid during the vesting period and performance unit distribution equivalent rights are paid at vesting.
|
(4)
|
See below for a reconciliation of Adjusted interest expense to Interest expense.
|
(5)
|
Represents cash distributions declared for common and subordinated units outstanding as of each respective period. Amounts for 2018 reflect estimated cash distributions for common units outstanding for the quarter ended March 31, 2018.
|
|
Three Months Ended March 31,
|
||||||
|
2018
|
|
2017
|
||||
|
(In millions)
|
||||||
Reconciliation of Adjusted EBITDA to net cash provided by operating activities:
|
|
|
|
||||
Net cash provided by operating activities
|
$
|
166
|
|
|
$
|
156
|
|
Interest expense, net of interest income
|
33
|
|
|
27
|
|
||
Other non-cash items
(1)
|
(1
|
)
|
|
1
|
|
||
Changes in operating working capital which (provided) used cash:
|
|
|
|
||||
Accounts receivable
|
(23
|
)
|
|
(10
|
)
|
||
Accounts payable
|
60
|
|
|
55
|
|
||
Other, including changes in noncurrent assets and liabilities
|
13
|
|
|
12
|
|
||
Return of investment in equity method affiliate
|
7
|
|
|
4
|
|
||
Change in fair value of derivatives
|
2
|
|
|
(24
|
)
|
||
Adjusted EBITDA
|
$
|
257
|
|
|
$
|
221
|
|
(1)
|
Other non-cash items include amortization of debt expense, discount and premium on long-term debt and write-downs of materials and supplies.
|
|
Three Months Ended March 31,
|
||||||
|
2018
|
|
2017
|
||||
|
(In millions)
|
||||||
Reconciliation of Adjusted interest expense to Interest expense:
|
|
|
|
||||
Interest Expense
|
$
|
33
|
|
|
$
|
27
|
|
Amortization of premium on long-term debt
|
1
|
|
|
1
|
|
||
Capitalized interest on expansion capital
|
2
|
|
|
—
|
|
||
Amortization of debt expense and discount
|
(1
|
)
|
|
(1
|
)
|
||
Adjusted interest expense
|
$
|
35
|
|
|
$
|
27
|
|
|
Three Months Ended March 31,
|
||||||
|
2018
|
|
2017
|
||||
|
(In millions)
|
||||||
Net cash provided by operating activities
|
$
|
166
|
|
|
$
|
156
|
|
Net cash used in investing activities
|
$
|
(176
|
)
|
|
$
|
(56
|
)
|
Net cash provided by (used in) financing activities
|
$
|
35
|
|
|
$
|
(92
|
)
|
|
Three Months Ended March 31,
|
||||||
|
2018
|
|
2017
|
||||
|
(In millions)
|
||||||
Proceeds from 2027 Notes, net of issuance costs
|
$
|
—
|
|
|
$
|
691
|
|
Net (repayments) proceeds from Revolving Credit Facility
|
—
|
|
|
(636
|
)
|
||
Proceeds from commercial paper program
|
190
|
|
|
—
|
|
||
Distributions
|
(150
|
)
|
|
(147
|
)
|
||
Cash taxes paid for employee equity-based compensation
|
(5
|
)
|
|
—
|
|
•
|
cash on hand;
|
•
|
cash generated from operations;
|
•
|
proceeds from commercial paper issuances;
|
•
|
borrowings under our Revolving Credit Facility; and
|
•
|
capital raised through debt and equity markets.
|
•
|
maintenance capital expenditures, which are cash expenditures (including expenditures for the construction or development of new capital assets or the replacement, improvement or expansion of existing capital assets) made to maintain, over the long-term, our operating capacity or operating income; and
|
•
|
expansion capital expenditures, which are cash expenditures incurred for acquisitions or capital improvements that we expect will increase our operating income or operating capacity over the long term.
|
•
|
rates, operating terms, conditions of service and service contracts;
|
•
|
certification and construction of new facilities;
|
•
|
extension or abandonment of services and facilities or expansion of existing facilities;
|
•
|
maintenance of accounts and records;
|
•
|
acquisition and disposition of facilities;
|
•
|
initiation and discontinuation of services;
|
•
|
depreciation and amortization policies;
|
•
|
conduct and relationship with certain affiliates;
|
•
|
market manipulation in connection with interstate sales, purchases or natural gas transportation; and
|
•
|
various other matters.
|
Exhibit Number
|
|
Description
|
Report or Registration Statement
|
SEC File or Registration Number
|
Exhibit Reference
|
|
Registrant’s registration statement on Form S-1, filed on November 26, 2013
|
File No. 333-192545
|
Exhibit 2.1
|
||
|
Registrant’s registration statement on Form S-1, filed on November 26, 2013
|
File No. 333-192545
|
Exhibit 3.1
|
||
|
Registrant’s Form 8-K filed November 15, 2017
|
File No. 001-36413
|
Exhibit 3.1
|
||
|
Registrant’s Form 8-K filed April 22, 2014
|
File No. 001-36413
|
Exhibit 3.1
|
||
|
Registrant’s Form 8-K filed May 29, 2014
|
File No. 001-36413
|
Exhibit 4.1
|
||
|
Registrant’s Form 8-K filed May 29, 2014
|
File No. 001-36413
|
Exhibit 4.2
|
||
|
Registrant’s Form 8-K filed May 29, 2014
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File No. 001-36413
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Exhibit 4.3
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Registrant’s Form 8-K filed February 19, 2016
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File No. 001-36413
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Exhibit 4.1
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Registrant’s Form 8-K filed March 9, 2017
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File No. 001-36413
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Exhibit 4.2
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+101.INS
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XBRL Instance Document.
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+101.SCH
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+101.PRE
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+101.LAB
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+101.CAL
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+101.DEF
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ENABLE MIDSTREAM PARTNERS, LP
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(Registrant)
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By: ENABLE GP, LLC
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Its general partner
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Date:
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May 2, 2018
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By:
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/s/ Tom Levescy
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Tom Levescy
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Senior Vice President, Chief Accounting Officer and Controller
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(Principal Accounting Officer)
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Vinson & Elkins LLP Attorneys at Law
Austin Beijing Dallas Dubai Hong Kong Houston London Moscow New York
Palo Alto Richmond Riyadh San Francisco Taipei Tokyo Washington
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1001 Fannin Street, Suite 2500
Houston, TX 77002-6760
Tel
+1.713.758.2222
Fax
+1.713.758.2346
www.velaw.com
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a)
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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;
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b)
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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;
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c)
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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
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d)
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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
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a)
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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
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b)
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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.
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/s/ Rodney J. Sailor
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Rodney J. Sailor
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President and Chief Executive Officer, Enable GP, LLC, the General Partner of Enable Midstream Partners, LP
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(Principal Executive Officer)
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a)
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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;
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b)
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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;
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c)
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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
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d)
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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
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a)
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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
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b)
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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.
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/s/ John P. Laws
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John P. Laws
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Executive Vice President, Chief Financial Officer, and Treasurer, Enable GP, LLC, the General Partner of Enable Midstream Partners, LP
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(Principal Financial Officer)
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/s/ Rodney J. Sailor
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Rodney J. Sailor
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President and Chief Executive Officer, Enable GP, LLC, the General Partner of Enable Midstream Partners, LP
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(Principal Executive Officer)
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/s/ John P. Laws
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John P. Laws
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Executive Vice President, Chief Financial Officer, and Treasurer, Enable GP, LLC, the General Partner of Enable Midstream Partners, LP
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(Principal Financial Officer)
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•
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the treatment of a unitholder whose units are the subject of a securities loan (e.g., a loan to a short seller to cover a short sale of units) (please read “—Tax Consequences of Unit Ownership—Allocation of Income, Gain, Loss and Deduction—Treatment of Securities Loans”);
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•
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whether our monthly convention for allocating taxable income and losses is permitted by existing Treasury Regulations (please read “—Disposition of Units—Allocations Between Transferors and Transferees”);
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•
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whether our method for taking into account Section 743 adjustments is sustainable in certain cases (please read “—Tax Consequences of Unit Ownership—Allocation of Income, Gain, Loss and Deduction—Section 754 Election” and “—Uniformity of Units”); and
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•
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whether our use of simplifying conventions for making adjustments to “book” basis and relevant allocations is permitted by existing Treasury Regulations (please read “—Tax Consequences of Unit Ownership—Allocation of Income, Gain, Loss and Deduction” and “—Uniformity of Units”).
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•
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interest on indebtedness allocable to property held for investment;
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•
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interest expense attributed to portfolio income; and
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•
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the portion of interest expense incurred to purchase or carry an interest in a passive activity to the extent attributable to portfolio income.
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•
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the net amount of our U.S. items of income, gain, deduction, and loss to the extent such items are included or allowed in the determination of taxable income for the year,
excluding
, however, certain specified types of passive investment income (such as capital gains and dividends) and certain payments made to the unitholder for services rendered to the Partnership; and
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•
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any gain recognized upon a disposition of our units to the extent such gain is attributable to Section 751 Assets, such as depreciation recapture and our “inventory items,” and is thus treated as ordinary income under Section 751 of the Code.
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•
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a short sale;
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•
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an offsetting notional principal contract; or
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•
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a futures or forward contract with respect to the partnership interest or substantially identical property.
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