|
ý
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Delaware
|
|
82-1646447
|
(State or other jurisdiction of incorporation or organization)
|
|
(I.R.S. Employer Identification No.)
|
Large accelerated filer
ý
|
|
Accelerated filer
¨
|
Non-accelerated filer
¨
|
|
Smaller reporting company
¨
|
Emerging growth company
¨
|
|
|
Title of each class
|
Trading Symbol
|
Name of each exchange on which registered
|
Common Units, Representing Limited Partner Interests
|
BPMP
|
New York Stock Exchange
|
|
Item
|
Page
|
|
|
|
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|
|
|
|
|
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|
|
|
|
March 31, 2019
|
|
December 31, 2018
|
||||
|
|
(in thousands of dollars)
|
||||||
ASSETS
|
||||||||
Current assets
|
|
|
|
|
|
|
||
Cash and cash equivalents
|
|
$
|
60,813
|
|
|
$
|
56,970
|
|
Accounts receivable – third parties
|
|
435
|
|
|
325
|
|
||
Accounts receivable – related parties
|
|
11,231
|
|
|
9,769
|
|
||
Prepaid expenses
|
|
2,822
|
|
|
4,667
|
|
||
Other current assets
|
|
565
|
|
|
629
|
|
||
Total current assets
|
|
75,866
|
|
|
72,360
|
|
||
Equity method investments (Note 4)
|
|
544,935
|
|
|
549,039
|
|
||
Property, plant and equipment, net (Note 5)
|
|
68,130
|
|
|
68,580
|
|
||
Other assets
|
|
3,737
|
|
|
3,224
|
|
||
Total assets
|
|
$
|
692,668
|
|
|
$
|
693,203
|
|
|
|
|
|
|
||||
LIABILITIES
|
||||||||
Current liabilities
|
|
|
|
|
|
|
||
Accounts payable – third parties
|
|
$
|
171
|
|
|
$
|
607
|
|
Accounts payable – related parties
|
|
1,832
|
|
|
2,553
|
|
||
Deferred revenue and credits
|
|
609
|
|
|
1,067
|
|
||
Other current liabilities (Note 6)
|
|
3,021
|
|
|
6,900
|
|
||
Total current liabilities
|
|
5,633
|
|
|
11,127
|
|
||
Long-term debt (Note 7)
|
|
468,000
|
|
|
468,000
|
|
||
Other liabilities
|
|
3,679
|
|
|
3,224
|
|
||
Total liabilities
|
|
477,312
|
|
|
482,351
|
|
||
|
|
|
|
|
||||
Commitments and contingencies (Note 12)
|
|
|
|
|
|
|
||
|
|
|
|
|
||||
EQUITY
|
||||||||
Common unitholders – public (47,802,826 units issued and outstanding)
|
|
839,279
|
|
|
836,789
|
|
||
Common unitholders – BP Holdco (4,581,177 units issued and outstanding)
|
|
(61,450
|
)
|
|
(61,684
|
)
|
||
Subordinated unitholders – BP Holdco (52,375,535 units issued and outstanding)
|
|
(702,542
|
)
|
|
(705,227
|
)
|
||
General partner
|
|
198
|
|
|
—
|
|
||
Total partners' capital
|
|
75,485
|
|
|
69,878
|
|
||
Non-controlling interests
|
|
139,871
|
|
|
140,974
|
|
||
Total equity
|
|
215,356
|
|
|
210,852
|
|
||
Total liabilities and equity
|
|
$
|
692,668
|
|
|
$
|
693,203
|
|
|
|
Three Months Ended March 31,
|
||||||
|
|
2019
|
|
2018
|
||||
|
|
(in thousands of dollars, unless otherwise indicated)
|
||||||
Revenue
|
|
|
|
|
||||
Third parties
|
|
$
|
798
|
|
|
$
|
798
|
|
Related parties
|
|
29,443
|
|
|
25,821
|
|
||
Total revenue
|
|
30,241
|
|
|
26,619
|
|
||
Costs and expenses
|
|
|
|
|
||||
Operating expenses – third parties
|
|
3,328
|
|
|
2,619
|
|
||
Operating expenses – related parties
|
|
1,435
|
|
|
962
|
|
||
Maintenance expenses – third parties
|
|
285
|
|
|
36
|
|
||
Maintenance expenses – related parties
|
|
19
|
|
|
20
|
|
||
General and administrative – third parties
|
|
960
|
|
|
788
|
|
||
General and administrative – related parties
|
|
3,438
|
|
|
3,423
|
|
||
Lease expense
|
|
18
|
|
|
15
|
|
||
Depreciation
|
|
656
|
|
|
662
|
|
||
Property and other taxes
|
|
109
|
|
|
111
|
|
||
Total costs and expenses
|
|
10,248
|
|
|
8,636
|
|
||
Operating income
|
|
19,993
|
|
|
17,983
|
|
||
Income from equity method investments
|
|
24,370
|
|
|
22,839
|
|
||
Interest expense, net
|
|
3,744
|
|
|
114
|
|
||
Income before income taxes
|
|
40,619
|
|
|
40,708
|
|
||
Income tax expense
|
|
—
|
|
|
—
|
|
||
Net income
|
|
40,619
|
|
|
40,708
|
|
||
Less: Net income attributable to non-controlling interests
|
|
3,466
|
|
|
10,169
|
|
||
Net income attributable to the Partnership
|
|
$
|
37,153
|
|
|
$
|
30,539
|
|
|
|
|
|
|
||||
Net income attributable to the Partnership per limited partner unit
–
basic and diluted (in dollars):
|
|
|
|
|
||||
Common units
|
|
$
|
0.35
|
|
|
$
|
0.29
|
|
Subordinated units
|
|
$
|
0.35
|
|
|
$
|
0.29
|
|
|
|
|
|
|
||||
Weighted average number of limited partner units outstanding - basic and diluted (in millions):
|
|
|
|
|
||||
Common units – public
|
|
47.8
|
|
|
47.8
|
|
||
Common units – BP Holdco
|
|
4.6
|
|
|
4.6
|
|
||
Subordinated units – BP Holdco
|
|
52.4
|
|
|
52.4
|
|
|
|
Partnership
|
|
|
|
|
||||||||||||||||||
(in thousands of dollars)
|
Common Unitholders
–
Public
|
|
Common Unitholders
–
BP Holdco
|
|
Subordinated Unitholders
–
BP Holdco
|
|
General Partner
|
|
Non-controlling Interests
|
|
Total
|
|||||||||||||
Balance at December 31, 2017
|
$
|
824,613
|
|
|
$
|
(47,141
|
)
|
|
$
|
(538,947
|
)
|
|
$
|
—
|
|
|
$
|
342,330
|
|
|
$
|
580,855
|
|
|
|
Cumulative effect of accounting change (Note 4)
|
(1,253
|
)
|
|
(120
|
)
|
|
(1,373
|
)
|
|
—
|
|
|
—
|
|
|
(2,746
|
)
|
||||||
|
Net income
|
13,934
|
|
|
1,336
|
|
|
15,269
|
|
|
—
|
|
|
10,169
|
|
|
40,708
|
|
||||||
|
Distributions to unitholders
(a)
|
(8,592
|
)
|
|
(823
|
)
|
|
(9,415
|
)
|
|
—
|
|
|
—
|
|
|
(18,830
|
)
|
||||||
|
Unit-based compensation
|
39
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
39
|
|
||||||
|
Distributions to non-controlling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(15,026
|
)
|
|
(15,026
|
)
|
||||||
Balance at March 31, 2018
|
$
|
828,741
|
|
|
$
|
(46,748
|
)
|
|
$
|
(534,466
|
)
|
|
$
|
—
|
|
|
$
|
337,473
|
|
|
$
|
585,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Balance at December 31, 2018
|
$
|
836,789
|
|
|
$
|
(61,684
|
)
|
|
$
|
(705,227
|
)
|
|
$
|
—
|
|
|
$
|
140,974
|
|
|
$
|
210,852
|
|
|
|
Net income
|
16,863
|
|
|
1,616
|
|
|
18,476
|
|
|
198
|
|
|
3,466
|
|
|
40,619
|
|
||||||
|
Distributions to unitholders
(a)
|
(14,413
|
)
|
|
(1,382
|
)
|
|
(15,791
|
)
|
|
—
|
|
|
—
|
|
|
(31,586
|
)
|
||||||
|
Unit-based compensation
|
40
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
40
|
|
||||||
|
Distributions to non-controlling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,569
|
)
|
|
(4,569
|
)
|
||||||
Balance at March 31, 2019
|
$
|
839,279
|
|
|
$
|
(61,450
|
)
|
|
$
|
(702,542
|
)
|
|
$
|
198
|
|
|
$
|
139,871
|
|
|
$
|
215,356
|
|
|
|
Three Months Ended March 31,
|
||||||
|
|
2019
|
|
2018
|
||||
|
|
(in thousands of dollars)
|
||||||
Cash flows from operating activities
|
|
|
|
|
|
|||
Net income
|
|
$
|
40,619
|
|
|
$
|
40,708
|
|
Adjustments to reconcile net income to net cash provided by operating activities
|
|
|
|
|
|
|||
Depreciation
|
|
656
|
|
|
662
|
|
||
Non-cash expenses
|
|
52
|
|
|
39
|
|
||
Income from equity method investments
|
|
(24,370
|
)
|
|
(22,839
|
)
|
||
Distributions of earnings received from equity method investments
|
|
25,315
|
|
|
25,537
|
|
||
Changes in operating assets and liabilities
|
|
|
|
|
|
|||
Accounts receivable – third parties
|
|
(110
|
)
|
|
(372
|
)
|
||
Accounts receivable – related parties
|
|
(1,462
|
)
|
|
(1,003
|
)
|
||
Prepaid expenses and other current assets
|
|
1,826
|
|
|
(1,124
|
)
|
||
Accounts payable – third parties
|
|
(436
|
)
|
|
170
|
|
||
Accounts payable – related parties
|
|
(721
|
)
|
|
(600
|
)
|
||
Deferred revenue and credits
|
|
(458
|
)
|
|
1,814
|
|
||
Other current liabilities
|
|
(3,870
|
)
|
|
(932
|
)
|
||
Net cash provided by operating activities
|
|
37,041
|
|
|
42,060
|
|
||
Cash flows from investing activities
|
|
|
|
|
|
|
||
Capital expenditures
|
|
(202
|
)
|
|
(85
|
)
|
||
Distributions in excess of earnings from equity method investments
|
|
3,159
|
|
|
6,070
|
|
||
Net cash provided by investing activities
|
|
2,957
|
|
|
5,985
|
|
||
Cash flows from financing activities
|
|
|
|
|
|
|
||
Distributions to unitholders
|
|
(31,586
|
)
|
|
(18,830
|
)
|
||
Distributions to non-controlling interests
|
|
(4,569
|
)
|
|
(15,026
|
)
|
||
Net cash used in financing activities
|
|
(36,155
|
)
|
|
(33,856
|
)
|
||
Net change in cash and cash equivalents
|
|
3,843
|
|
|
14,189
|
|
||
Cash and cash equivalents at beginning of the period
|
|
56,970
|
|
|
32,694
|
|
||
Cash and cash equivalents at end of the period
|
|
$
|
60,813
|
|
|
$
|
46,883
|
|
Supplemental cash flow information
|
|
|
|
|
|
|||
Cash paid for interest
|
|
$
|
8,019
|
|
|
$
|
107
|
|
Cash paid for lease liabilities
|
|
15
|
|
|
—
|
|
||
Non-cash investing transactions
|
|
|
|
|
||||
Accrued capital expenditures
|
|
169
|
|
|
198
|
|
•
|
BP Two Pipeline Company LLC, which owns the BP#2 crude oil pipeline system (“BP2”).
|
•
|
BP River Rouge Pipeline Company LLC, which owns the Whiting to River Rouge refined products pipeline system (“River Rouge”).
|
•
|
BP D-B Pipeline Company LLC, which owns the Diamondback diluent pipeline system (“Diamondback”). BP2, River Rouge, and Diamondback, together, are referred to as the "Wholly Owned Assets".
|
•
|
A
28.5%
ownership interest in Mars Oil Pipeline Company, LLC (“Mars”), which owns a major corridor crude oil pipeline system in the Gulf of Mexico.
|
•
|
A
65%
managing member interest in Mardi Gras Transportation System Company, LLC (“Mardi Gras”), which holds the following investments in joint ventures located in the Gulf of Mexico:
|
•
|
A
56%
ownership interest in Caesar Oil Pipeline Company, LLC (“Caesar”),
|
•
|
A
53%
ownership interest in Cleopatra Gas Gathering Company, LLC (“Cleopatra”),
|
•
|
A
65%
ownership interest in Proteus Oil Pipeline Company, LLC (“Proteus”), and,
|
•
|
A
65%
ownership interest in Endymion Oil Pipeline Company, LLC (“Endymion”).
|
•
|
Together Endymion, Caesar, Cleopatra and Proteus are referred to as the “Mardi Gras Joint Ventures.”
|
•
|
A
22.7%
ownership interest in Ursa.
|
•
|
A
25%
ownership interest in KM Phoenix.
|
|
Three Months Ended March 31,
|
|||||
|
2019
|
2018
|
||||
Transportation services revenue - third parties
|
$
|
798
|
|
$
|
798
|
|
Transportation services revenue - related parties
|
29,443
|
|
25,821
|
|
||
Total ASC 606 revenue
|
$
|
30,241
|
|
$
|
26,619
|
|
|
As of March 31, 2019
|
||
Remainder of 2019
|
$
|
81,407
|
|
2020
|
109,686
|
|
|
Total
|
$
|
191,093
|
|
|
March 31, 2019
|
December 31, 2018
|
||||
Receivables from contracts with customers - third parties
|
$
|
435
|
|
$
|
325
|
|
Receivables from contracts with customers - related parties
|
10,848
|
|
9,611
|
|
||
Deferred revenue and credits - related parties
|
609
|
|
1,067
|
|
|
January 1, 2019
|
||
ROU Assets
|
$
|
518
|
|
Current lease liability
|
60
|
|
|
Long-term lease liability
|
458
|
|
|
Post-adoption ASC 842
|
Pre-adoption ASC 842
|
||||
|
March 31, 2019
|
December 31, 2018
|
||||
2019
|
$
|
47
|
|
$
|
62
|
|
2020
|
63
|
|
63
|
|
||
2021
|
32
|
|
32
|
|
||
2022
|
33
|
|
33
|
|
||
2023
|
34
|
|
34
|
|
||
Thereafter
|
514
|
|
514
|
|
||
Total
|
$
|
723
|
|
$
|
738
|
|
|
Three Months Ended March 31, 2019
|
|
Three Months Ended March 31, 2018
|
|||||||||||||||||||||
|
Percentage Ownership
|
Distributions Received
|
Income from EMI
|
Carrying Value
|
|
Percentage Ownership
|
Cumulative Effect of Accounting Change
(3)
|
Distributions Received
|
Income from EMI
|
Carrying Value
|
||||||||||||||
Mars
|
28.5%
|
$
|
(12,158
|
)
|
$
|
11,824
|
|
$
|
58,809
|
|
|
28.5%
|
$
|
(2,746
|
)
|
$
|
(12,825
|
)
|
$
|
10,127
|
|
$
|
60,117
|
|
Caesar
(1)
|
56.0%
|
(5,320
|
)
|
5,327
|
|
119,397
|
|
|
56.0%
|
—
|
|
(6,117
|
)
|
4,326
|
|
121,795
|
|
|||||||
Cleopatra
(1)
|
53.0%
|
(3,445
|
)
|
2,820
|
|
118,925
|
|
|
53.0%
|
—
|
|
(2,915
|
)
|
1,849
|
|
122,446
|
|
|||||||
Proteus
(1)
|
65.0%
|
(2,340
|
)
|
622
|
|
79,614
|
|
|
65.0%
|
—
|
|
(5,005
|
)
|
3,414
|
|
85,553
|
|
|||||||
Endymion
(1)
|
65.0%
|
(1,950
|
)
|
1,134
|
|
81,695
|
|
|
65.0%
|
—
|
|
(4,745
|
)
|
3,123
|
|
86,574
|
|
|||||||
Others
(2)
|
Various
|
(3,261
|
)
|
2,643
|
|
86,495
|
|
|
0%
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||||
Total Equity Investments
|
|
$
|
(28,474
|
)
|
$
|
24,370
|
|
$
|
544,935
|
|
|
|
$
|
(2,746
|
)
|
$
|
(31,607
|
)
|
$
|
22,839
|
|
$
|
476,485
|
|
1.
|
These investments are held by our investment in Mardi Gras which increased to
65%
from
20%
on October 1, 2018.
|
2.
|
Includes ownership in Ursa (
22.7%
) and KM Phoenix (
25%
).
|
3.
|
The financial results of Mars reflected the adoption of Topic 606 on January 1, 2018 under the modified retrospective transition method through a cumulative adjustment to equity. Our cumulative effect impact from this accounting change to our Mars investment was
$(2,746)
, offset to equity. The Mardi Gras Joint Ventures and Ursa adopted this ASU on January 1, 2019 and there was no cumulative effect impact from the adoption. KM Phoenix adopted Topic 606 on January 1, 2018 and there was no cumulative effect impact from the adoption.
|
|
|
Three Months Ended March 31,
|
||||||
|
|
2019
|
|
2018
(1)
|
||||
Statement of operations
|
|
|
|
|
||||
Revenue
|
|
$
|
116,003
|
|
|
$
|
112,076
|
|
Operating expenses
|
|
45,813
|
|
|
47,481
|
|
||
Net income
|
|
70,303
|
|
|
64,712
|
|
1.
|
Balances include KM Phoenix and Ursa results.
|
|
|
March 31, 2019
|
|
December 31, 2018
|
||||
Land
|
|
$
|
155
|
|
|
$
|
155
|
|
Right-of-way assets
|
|
1,380
|
|
|
1,380
|
|
||
Buildings and improvements
|
|
12,032
|
|
|
12,032
|
|
||
Pipelines and equipment
|
|
93,879
|
|
|
93,617
|
|
||
Other
|
|
509
|
|
|
509
|
|
||
Construction in progress
|
|
221
|
|
|
277
|
|
||
Property, plant and equipment
|
|
108,176
|
|
|
107,970
|
|
||
Less: Accumulated depreciation
|
|
(40,046
|
)
|
|
(39,390
|
)
|
||
Property, plant and equipment, net
|
|
$
|
68,130
|
|
|
$
|
68,580
|
|
|
|
March 31, 2019
|
|
December 31, 2018
|
||||
Current portion of environmental remediation obligations
|
|
$
|
546
|
|
|
$
|
629
|
|
Current portion of lease liabilities
|
|
60
|
|
|
—
|
|
||
Accrued interest payable - related parties
|
|
201
|
|
|
4,155
|
|
||
Accrued liabilities
|
|
2,214
|
|
|
2,116
|
|
||
Other current liabilities
|
|
$
|
3,021
|
|
|
$
|
6,900
|
|
|
|
Three Months Ended March 31,
|
||||||
|
|
2019
|
|
2018
|
||||
Operating expenses—related parties
|
|
$
|
1,435
|
|
|
$
|
962
|
|
Maintenance expenses—related parties
|
|
19
|
|
|
20
|
|
||
General and administrative—related parties
|
|
3,438
|
|
|
3,423
|
|
||
Total costs and expenses—related parties
|
|
$
|
4,892
|
|
|
$
|
4,405
|
|
Date Paid or
to be Paid |
Three Months Ended
|
General Partner
|
Limited Partners' Common Units
|
Limited Partners' Subordinated Units
|
Total
|
Distributions per Limited Partner Unit
|
||||||||||
May 15, 2018
|
March 31, 2018
|
$
|
—
|
|
$
|
14,010
|
|
$
|
14,010
|
|
$
|
28,020
|
|
$
|
0.2675
|
|
May 15, 2019
|
March 31, 2019
|
198
|
|
16,375
|
|
16,373
|
|
32,946
|
|
0.3126
|
|
|
|
Three Months Ended March 31,
|
||||||
|
|
2019
|
|
2018
|
||||
Net income attributable to the Partnership
|
|
$
|
37,153
|
|
|
$
|
30,539
|
|
Less:
|
|
|
|
|
||||
Incentive distribution rights currently held by the General Partner
|
|
198
|
|
|
—
|
|
||
Limited partners' distribution declared on common units
|
|
16,375
|
|
|
14,010
|
|
||
Limited partners' distribution declared on subordinated units
|
|
16,373
|
|
|
14,010
|
|
||
Net income attributable to the Partnership in excess of distributions
|
|
$
|
4,207
|
|
|
$
|
2,519
|
|
|
|
|
Three Months Ended March 31, 2019
|
||||||||||||||
|
|
|
General Partner
|
|
Limited Partners' Common Units
|
|
Limited Partners' Subordinated Units
|
|
Total
|
||||||||
Distributions declared
|
|
$
|
198
|
|
|
$
|
16,375
|
|
|
$
|
16,373
|
|
|
$
|
32,946
|
|
|
Net income attributable to the Partnership in excess of distributions
|
—
|
|
|
2,104
|
|
|
2,103
|
|
|
4,207
|
|
||||||
Net income attributable to the Partnership
|
$
|
198
|
|
|
$
|
18,479
|
|
|
$
|
18,476
|
|
|
$
|
37,153
|
|
||
Weighted average units outstanding:
|
|
|
|
|
|
|
|
||||||||||
Basic
|
|
|
|
|
52,384
|
|
|
52,376
|
|
|
104,760
|
|
|||||
Diluted
|
|
|
|
|
52,394
|
|
|
52,376
|
|
|
104,770
|
|
|||||
Net income per limited partner unit (in dollars):
|
|
|
|
|
|
|
|
||||||||||
Basic
|
|
|
|
|
$
|
0.35
|
|
|
$
|
0.35
|
|
|
|
||||
Diluted
|
|
|
|
|
$
|
0.35
|
|
|
$
|
0.35
|
|
|
|
|
|
|
Three Months Ended March 31, 2018
|
||||||||||||||
|
|
|
General Partner
|
|
Limited Partners' Common Units
|
|
Limited Partners' Subordinated Units
|
|
Total
|
||||||||
Distributions declared
|
$
|
—
|
|
|
$
|
14,010
|
|
|
$
|
14,010
|
|
|
$
|
28,020
|
|
||
Net income attributable to the Partnership in excess of distributions
|
—
|
|
|
1,260
|
|
|
1,259
|
|
|
2,519
|
|
||||||
Net income attributable to the Partnership
|
$
|
—
|
|
|
$
|
15,270
|
|
|
$
|
15,269
|
|
|
$
|
30,539
|
|
||
Weighted average units:
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Basic
|
|
|
|
|
|
52,376
|
|
|
52,376
|
|
|
104,752
|
|
||||
Diluted
|
|
|
|
|
52,378
|
|
|
52,376
|
|
|
104,754
|
|
|||||
Net income per limited partner unit (in dollars):
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Basic
|
|
|
|
|
|
$
|
0.29
|
|
|
$
|
0.29
|
|
|
|
|
||
Diluted
|
|
|
|
$
|
0.29
|
|
|
$
|
0.29
|
|
|
|
|
|
Balance sheet location
|
March 31, 2019
|
December 31, 2018
|
||||
Current portion of environmental remediation obligations
|
Other current liabilities
|
$
|
546
|
|
$
|
629
|
|
Long-term portion of environmental remediation obligations
|
Other liabilities
|
3,231
|
|
3,224
|
|
||
Total
|
|
$
|
3,777
|
|
$
|
3,853
|
|
|
Balance sheet location
|
March 31, 2019
|
December 31, 2018
|
||||
Current portion of indemnification assets
|
Other current assets
|
$
|
546
|
|
$
|
629
|
|
Non-current portion of indemnification assets
|
Other assets
|
3,231
|
|
3,224
|
|
||
Total
|
|
$
|
3,777
|
|
$
|
3,853
|
|
|
Phantom Units
|
|||||
|
Number of Units (in units)
|
|
Weighted Average Grant Date Fair Value per Unit (in dollars)
|
|||
Outstanding at December 31, 2018
|
3,737
|
|
|
$
|
20.07
|
|
Granted
|
15,227
|
|
|
16.64
|
|
|
Outstanding at March 31, 2019
|
18,964
|
|
|
$
|
17.32
|
|
|
March 31, 2019
|
|
December 31, 2018
|
||||
Balance sheet
|
|
|
|
||||
Equity method investments
|
$
|
399,631
|
|
|
$
|
402,783
|
|
Non-controlling interests
|
139,871
|
|
|
140,974
|
|
|
Three Months Ended March 31,
|
||||||
|
2019
|
|
2018
|
||||
Statement of operations
|
|
|
|
||||
Income from equity method investments
|
$
|
9,903
|
|
|
$
|
12,712
|
|
Less: Net income attributable to non-controlling interests
|
3,466
|
|
|
10,169
|
|
||
Net impact on Net income attributable to the Partnership
|
$
|
6,437
|
|
|
$
|
2,543
|
|
|
Three Months Ended March 31,
|
||||||
|
2019
|
|
2018
|
||||
Statement of cash flows
|
|
|
|
||||
Cash flows from operating activities
|
|
|
|
||||
Distributions of earnings received from equity method investments
|
$
|
9,896
|
|
|
$
|
12,712
|
|
Cash flows from investing activities
|
|
|
|
||||
Distribution in excess of earnings from equity method investments
|
3,159
|
|
|
6,070
|
|
||
Cash flows from financing activities
|
|
|
|
||||
Distributions to non-controlling interests
|
(4,569
|
)
|
|
(15,026
|
)
|
||
Net change on the Partnership's cash and cash equivalents
|
$
|
8,486
|
|
|
$
|
3,756
|
|
•
|
The continued ability of BP and any non-affiliate customers to satisfy their obligations under our commercial and other agreements and the impact of lower market prices for crude oil, natural gas, refined products and diluent.
|
•
|
The volume of crude oil, natural gas, refined products and diluent we transport or store and the prices that we can charge our customers.
|
•
|
The tariff rates with respect to volumes that we transport through our regulated assets, which rates are subject to review and possible adjustment imposed by federal and state regulators.
|
•
|
Changes in revenue we realize under the fixed loss allowance provisions of our fees and tariffs resulting from changes in underlying commodity prices.
|
•
|
Fluctuations in the prices for crude oil, natural gas, refined products and diluent.
|
•
|
The level of onshore and offshore production and demand for crude oil, natural gas, refined products and diluent.
|
•
|
Our ability to successfully integrate recently acquired assets with our own and realize the anticipated benefits of such acquisitions.
|
•
|
Changes in global economic conditions and the effects of a global economic downturn on the business of BP and the business of its suppliers, customers, business partners and credit lenders.
|
•
|
Liabilities associated with the risks and operational hazards inherent in transporting and/or storing crude oil, natural gas, refined products and diluent.
|
•
|
Curtailment of operations or expansion projects due to unexpected leaks or spills; severe weather disruption; riots, strikes, lockouts or other industrial disturbances; or failure of information technology systems due to various causes, including unauthorized access or attack.
|
•
|
Costs or liabilities associated with federal, state and local laws and regulations relating to environmental protection and safety, including spills, releases and pipeline integrity.
|
•
|
Costs associated with compliance with evolving environmental laws and regulations on climate change.
|
•
|
Costs associated with compliance with safety regulations and system maintenance programs, including pipeline integrity management program testing and related repairs.
|
•
|
Changes in tax status.
|
•
|
Changes in the cost or availability of third-party vessels, pipelines, rail cars and other means of delivering and transporting crude oil, natural gas, refined products and diluent.
|
•
|
Direct or indirect effects on our business resulting from actual or threatened terrorist incidents or acts of war.
|
•
|
Changes in, and availability to us, of the equity and debt capital markets.
|
•
|
BP Two Pipeline Company LLC, which owns the BP#2 crude oil pipeline system (“BP2”).
|
•
|
BP River Rouge Pipeline Company LLC, which owns the Whiting to River Rouge refined products pipeline system (“River Rouge”).
|
•
|
BP D-B Pipeline Company LLC, which owns the Diamondback diluent pipeline system (“Diamondback”). BP2, River Rouge, and Diamondback are in the Midwest region of the United States, and together are referred to as the "Wholly Owned Assets".
|
•
|
A
28.5%
ownership interest in Mars Oil Pipeline Company, LLC (“Mars”), which owns a major corridor crude oil pipeline system in the Gulf of Mexico.
|
•
|
A
65%
managing member interest in Mardi Gras Transportation System Company, LLC (“Mardi Gras”), which holds the following investments in joint ventures located in the Gulf of Mexico:
|
•
|
A
56%
ownership interest in Caesar Oil Pipeline Company, LLC (“Caesar”),
|
•
|
A
53%
ownership interest in Cleopatra Gas Gathering Company, LLC (“Cleopatra”),
|
•
|
A
65%
ownership interest in Proteus Oil Pipeline Company, LLC (“Proteus”), and,
|
•
|
A
65%
ownership interest in Endymion Oil Pipeline Company, LLC (“Endymion”). Together Endymion, Caesar, Cleopatra and Proteus are referred to as the “Mardi Gras Joint Ventures.”
|
•
|
A
22.7%
ownership interest in Ursa Oil Pipeline Company, LLC ("Ursa"), which owns approximately 47 miles of pipeline that provides gathering and transportation services extending from Mississippi Canyon Block 809 to West Delta Block 143.
|
•
|
A
25%
ownership interest in KM Phoenix Holdings, LLC ("KM Phoenix"), which owns 13 refined products terminals located across the United States with approximately 8.1 million barrels of storage and associated infrastructure).
|
•
|
utilize any remaining unused capacity on, or add additional capacity to, our pipeline systems;
|
•
|
increase throughput volumes on our pipeline systems by making connections to existing or new third-party pipelines or other facilities, primarily driven by the anticipated supply of and demand for crude oil, natural gas, refined products and diluent;
|
•
|
identify and execute organic expansion projects; and
|
•
|
increase throughput volumes via acquisitions.
|
|
Three Months Ended March 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in thousands of dollars)
|
||||||
Wholly Owned Assets
|
|
|
|
||||
Maintenance expenses
|
$
|
304
|
|
|
$
|
56
|
|
Maintenance capital expenditures
|
202
|
|
|
85
|
|
||
Total Maintenance Spend - Wholly Owned Assets
|
$
|
506
|
|
|
$
|
141
|
|
•
|
our operating performance as compared to other publicly traded partnerships in the midstream energy industry, without regard to historical cost basis or financing methods;
|
•
|
the ability of our business to generate sufficient cash to support our decision to make distributions to our unitholders;
|
•
|
our 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.
|
•
|
(i) an additional 45.0% interest in Mardi Gras, from BP Pipelines,
|
•
|
(ii) a 25.0% interest in KM Phoenix Holdings, LLC, a Delaware limited liability company, from BP Products, and
|
•
|
(iii) a 22.7% interest in URSA Oil Pipeline Company LLC, a Delaware limited liability company, from BP Offshore.
|
|
Three Months Ended
March 31, |
||||||
|
2019
|
|
2018
|
||||
|
(in thousands of dollars)
|
||||||
Revenue
|
$
|
30,241
|
|
|
$
|
26,619
|
|
Costs and expenses
|
|
|
|
||||
Operating expenses
|
4,763
|
|
|
3,581
|
|
||
Maintenance expenses
|
304
|
|
|
56
|
|
||
General and administrative
|
4,398
|
|
|
4,211
|
|
||
Lease expense
|
18
|
|
|
15
|
|
||
Depreciation
|
656
|
|
|
662
|
|
||
Property and other taxes
|
109
|
|
|
111
|
|
||
Total costs and expenses
|
10,248
|
|
|
8,636
|
|
||
Operating income
|
19,993
|
|
|
17,983
|
|
||
Income from equity method investments
|
24,370
|
|
|
22,839
|
|
||
Interest (income) expense, net
|
3,744
|
|
|
114
|
|
||
Income before income taxes
|
40,619
|
|
|
40,708
|
|
||
Income tax expense
|
—
|
|
|
—
|
|
||
Net income
|
40,619
|
|
|
40,708
|
|
||
Less: Net income attributable to non-controlling interests
|
3,466
|
|
|
10,169
|
|
||
Net income attributable to the Partnership
|
$
|
37,153
|
|
|
$
|
30,539
|
|
|
|
|
|
||||
Adjusted EBITDA*
|
$
|
49,123
|
|
|
$
|
50,252
|
|
Less: Adjusted EBITDA attributable to non-controlling interests
|
4,569
|
|
|
15,026
|
|
||
Adjusted EBITDA attributable to the Partnership
|
$
|
44,554
|
|
|
$
|
35,226
|
|
* See Reconciliation of Non-GAAP Measures below.
|
|
|
|
|
Three Months Ended
March 31, |
||||||
|
2019
|
|
2018
|
||||
|
(in thousands of dollars)
|
||||||
Reconciliation of Adjusted EBITDA and Cash Available for Distribution to Net Income
|
|
|
|
||||
Net income
|
$
|
40,619
|
|
|
$
|
40,708
|
|
Add:
|
|
|
|
||||
Depreciation
|
656
|
|
|
662
|
|
||
Interest expense, net
|
3,744
|
|
|
114
|
|
||
Cash distributions received from equity method investments — Mardi Gras Joint Ventures
|
13,055
|
|
|
18,782
|
|
||
Cash distributions received from equity method investments — Mars
|
12,158
|
|
|
12,825
|
|
||
Cash distributions received from equity method investments — Others
|
3,261
|
|
|
—
|
|
||
Less:
|
|
|
|
||||
Income from equity method investments — Mardi Gras Joint Ventures
|
9,903
|
|
|
12,712
|
|
||
Income from equity method investments — Mars
|
11,824
|
|
|
10,127
|
|
||
Income from equity method investments — Others
|
2,643
|
|
|
—
|
|
||
Adjusted EBITDA
|
49,123
|
|
|
50,252
|
|
||
Less:
|
|
|
|
||||
Adjusted EBITDA attributable to non-controlling interests
|
4,569
|
|
|
15,026
|
|
||
Adjusted EBITDA attributable to the Partnership
|
44,554
|
|
|
35,226
|
|
||
Add:
|
|
|
|
||||
Net adjustments from volume deficiency agreements
|
(731
|
)
|
|
1,332
|
|
||
Less:
|
|
|
|
||||
Net interest paid/(received)
|
7,730
|
|
|
(16
|
)
|
||
Maintenance capital expenditures
|
202
|
|
|
85
|
|
||
Cash reserves
|
(3,755
|
)
|
|
—
|
|
||
Cash available for distribution attributable to the Partnership
|
$
|
39,646
|
|
|
$
|
36,489
|
|
|
Three Months Ended March 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in thousands of dollars)
|
||||||
Reconciliation of Adjusted EBITDA and Cash Available for Distribution to Net Cash Provided by Operating Activities
|
|
|
|
||||
Net cash provided by operating activities
|
$
|
37,041
|
|
|
$
|
42,060
|
|
Add:
|
|
|
|
||||
Interest expense, net
|
3,744
|
|
|
114
|
|
||
Distribution in excess of earnings from equity method investments
|
3,159
|
|
|
6,070
|
|
||
Changes in other assets and liabilities
|
5,231
|
|
|
2,047
|
|
||
Less:
|
|
|
|
||||
Non-cash adjustments
|
52
|
|
|
39
|
|
||
Adjusted EBITDA
|
49,123
|
|
|
50,252
|
|
||
Less:
|
|
|
|
||||
Adjusted EBITDA attributable to non-controlling interests
|
4,569
|
|
|
15,026
|
|
||
Adjusted EBITDA attributable to the Partnership
|
44,554
|
|
|
35,226
|
|
||
Add:
|
|
|
|
||||
Net adjustments from volume deficiency agreements
|
(731
|
)
|
|
1,332
|
|
||
Less:
|
|
|
|
||||
Net interest paid/(received)
|
7,730
|
|
|
(16
|
)
|
||
Maintenance capital expenditures
|
202
|
|
|
85
|
|
||
Cash reserves
|
(3,755
|
)
|
|
—
|
|
||
Cash available for distribution attributable to the Partnership
|
$
|
39,646
|
|
|
$
|
36,489
|
|
|
Three Months Ended March 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in thousands of dollars)
|
||||||
Cash spent on maintenance capital expenditures
|
$
|
202
|
|
|
$
|
85
|
|
Increase in accrued capital expenditures
|
5
|
|
|
179
|
|
||
Total capital expenditures incurred
|
$
|
207
|
|
|
$
|
264
|
|
Exhibit
No. |
|
Exhibit Description
|
|
Incorporated by Reference
|
|
Filed
Herewith |
|
Furnished
Herewith |
||||||
Form
|
|
Exhibit
|
|
Filing Date
|
|
SEC
File No. |
|
|||||||
3.1
|
|
|
S-1
|
|
3.1
|
|
9/11/2017
|
|
333-220407
|
|
|
|
|
|
3.2
|
|
|
10-Q
|
|
3.2
|
|
12/6/2017
|
|
001-38260
|
|
|
|
|
|
3.3
|
|
|
S-1
|
|
3.3
|
|
9/11/2017
|
|
333-220407
|
|
|
|
|
|
3.4
|
|
|
S-1
|
|
3.4
|
|
9/11/2017
|
|
333-220407
|
|
|
|
|
|
10.1
|
|
|
8-K
|
|
10.1
|
|
10/2/2018
|
|
001-38260
|
|
|
|
|
|
10.2
|
|
|
10-K
|
|
10.13
|
|
2/28/2019
|
|
001-38260
|
|
|
|
|
|
10.3
|
|
|
|
|
|
|
|
|
|
|
X
|
|
|
|
31.1
|
|
|
|
|
|
|
|
|
|
|
X
|
|
|
|
31.2
|
|
|
|
|
|
|
|
|
|
|
X
|
|
|
|
32*
|
|
|
|
|
|
|
|
|
|
|
|
|
X
|
|
101.INS
|
|
XBRL Instance Document
|
|
|
|
|
|
|
|
|
|
X
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document
|
|
|
|
|
|
|
|
|
|
X
|
|
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
|
|
|
|
|
|
|
|
X
|
|
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
|
|
|
|
|
|
|
|
|
X
|
|
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
|
|
|
|
|
|
|
|
|
X
|
|
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
|
|
|
|
|
|
|
|
X
|
|
|
*
|
Pursuant to SEC Release No. 33-8212, this certification will be treated as “accompanying” this Quarterly Report on Form 10-Q and not “filed” as part of such report for purposes of Section 18 of the Exchange Act or otherwise subject to the liability of Section 18 of the Exchange Act, and this certification will not be deemed to be incorporated by reference into any filing under the Securities Act, except to the extent that the registrant specifically incorporates it by reference.
|
|
|
|
|
Date: May 9, 2019
|
|
BP MIDSTREAM PARTNERS LP
|
|
|
|
By:
|
BP MIDSTREAM PARTNERS GP LLC,
|
|
|
|
its general partner
|
|
|
|
|
|
|
By:
|
/s/ Craig W. Coburn
|
|
|
|
Craig W. Coburn
|
|
|
|
Chief Financial Officer and Director
|
1.
|
Loan Repayment Date
. The Amended Loan Repayment Date is hereby waived and from the date of this Agreement, the definition of the Amended Loan Repayment Date shall be amended and modified to mean November 30, 2020 (the “Second Amended Loan Repayment Date”).
|
2.
|
Payment of Interest
. The Borrower shall pay accrued Interest on the Loan on each Fee Payment Date and the remaining accrued Interest shall be paid on the Second Amended Loan Repayment Date.
|
3.
|
No other waivers
. Except as agreed in herein, there are no other waivers or amendments to the terms of the Facility Agreement.
|
4.
|
Governing Law
. This Agreement shall be governed by the laws of the state of New York.
|
5.
|
Counterparts
. This Agreement may be executed in any number of counterparts and this has the same effect as if the signatures on the counterparts were on a single copy of this Agreement.
|
BP Midstream Partners, LP
|
|
North America Funding Company
|
By: BP Midstream Partners GP LLC,
|
|
|
Its general partner
|
|
By:
/s/ Thu Dang
|
|
|
Name: Thu Dang
|
By:
/s/ Craig W. Coburn
|
|
Title: Treasurer
|
Name: Craig W. Coburn
|
|
|
Title: Chief Financial Officer
|
|
|
1.
|
I have reviewed this quarterly report on Form 10-Q of BP Midstream Partners LP;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: May 9, 2019
|
/s/ Robert P. Zinsmeister
|
|
Robert P. Zinsmeister
|
|
Chief Executive Officer and Director
|
|
BP Midstream Partners GP LLC
|
|
(the general partner of BP Midstream Partners LP)
|
1.
|
I have reviewed this quarterly report on Form 10-Q of BP Midstream Partners LP;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: May 9, 2019
|
/s/ Craig W. Coburn
|
|
Craig W. Coburn
|
|
Chief Financial Officer and Director
|
|
BP Midstream Partners GP LLC
|
|
(the general partner of BP Midstream Partners LP)
|
(1)
|
the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
|
(2)
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Partnership.
|
Date: May 9, 2019
|
/s/ Robert P. Zinsmeister
|
|
Robert P. Zinsmeister
|
|
Chief Executive Officer and Director
|
|
BP Midstream Partners GP LLC
|
|
(the general partner of BP Midstream Partners LP)
|
|
/s/ Craig W. Coburn
|
|
Craig W. Coburn
|
|
Chief Financial Officer and Director
|
|
BP Midstream Partners GP LLC
|
|
(the general partner of BP Midstream Partners LP)
|