RELATED PARTY TRANSACTIONS

12 Months Ended

Dec. 31, 2011

Related Party Transactions [Abstract]

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS:

We previously held a 50% interest in Midcontinent Express Pipeline LLC ("MEP"), a joint venture with Kinder Morgan Energy Partners, L.P. (KMP). On May 26, 2010 we transferred a majority of our interest in MEP to ETE in exchange for 12,273,830 common units previously held by ETE. In conjunction with this transfer, we recorded a non-cash charge of approximately $52.6 million during 2010 to reduce the carrying value of our investment in MEP to its estimated fair value. As a part of this transaction, ETE transferred its interest in MEP to Regency in exchange for Regency Common Units. Along with this transaction ETE also transferred its option to purchase ETP's remaining 0.1% interest in MEP. On September 1, 2011, Regency exercised its option to acquire our remaining 0.1% interest in MEP for approximately $1.2 million in cash.

Regency became a related party on May 26, 2010 when ETE acquired all of the equity interest in the general partner of Regency. We provide Regency with certain natural gas sales and transportation services and compression equipment and Regency provides us with certain contract compression services. For the year ended December 31, 2011, we recorded revenue of $34.1 million, costs of products sold of $34.3 million and operating expenses of $2.5 million related to transactions with Regency. For the period from May 26, 2010 to December 31, 2010, we recorded revenue of $4.0 million, costs of products sold of $4.0 million and operating expenses of $0.5 million related to transactions with Regency.

We received $17.1 million, $6.3 million and $0.5 million in management fees from ETE for the provision of various general and administrative services for ETE’s benefit for the years ended December 31, 2011, 2010 and 2009, respectively. The increase recorded in the years ended December 31, 2011 and 2010 were the result of increased service fees related to the provision of various general and administrative services for Regency which was acquired by ETE in 2010. In addition, the management fees for the year ended December 31, 2011 include the provision of various general and administrative services for Regency. For the year ended December 31, 2011 we recorded from Regency $6.6 million for reimbursement of various general and administrative expenses incurred by us.

For the year ended December 31, 2011 revenue of $1.9 million and cost of products sold of $1.2 million are included in our consolidated statement of operations related to transactions with FEP, our unconsolidated affiliate. For the year ended December 31, 2010 revenue of $26.0 million and cost of products sold of $20.5 million are included in our consolidated statement of operations related to transactions with FEP, our unconsolidated affiliate.

Enterprise Products Partners L.P. ("Enterprise") is considered to be a related party to us due to Enterprise’s holdings of outstanding common units of ETE. We and Enterprise transport natural gas on each other’s pipelines, share operating expenses on jointly-owned pipelines and ETC OLP sells natural gas to Enterprise. Our propane operations routinely buy and sell product with Enterprise. Our propane operations purchase a portion of our propane requirements from Enterprise pursuant to an agreement that expires in 2015 and includes an option to extend the agreement for an additional year.

The following table presents sales to and purchases from Enterprise:

	Years Ended December 31,
	2011		2010		2009
Natural Gas Operations:
Sales	$	654,129	$	538,657	$	414,333
Purchases	26,992		23,592		48,528
Propane Operations:
Sales	10,613		15,527		19,961
Purchases	471,046		415,897		343,540

As of December 31, 2011 and 2010, Titan had forward mark-to-market derivatives for approximately 38.8 million and 1.7 million gallons of propane at a fair value liability of $4.1 million and a fair value asset of $0.2 million, respectively, with Enterprise. In addition, as of December 31, 2010, Titan had forward derivatives accounted for as cash flow hedges of 32.5 million gallons of propane at a fair value asset of $6.6 million with Enterprise. Our propane operations discontinued cash

flow hedge accounting in July 2011; therefore, all of their forward derivatives are currently accounted for using mark-to-market accounting.

The following table summarizes the related party balances on our consolidated balance sheets:

	As of December 31,
	2011			2010
Accounts receivable from related parties:
Enterprise:
Natural Gas Operations	$	54,644		$	36,736
Propane Operations	—			2,327
Other	27,109			14,803
Total accounts receivable from related parties:	$	81,753		$	53,866
Accounts payable from related parties:
Enterprise:
Natural Gas Operations	$	2,198		$	2,687
Propane Operations	27,770			22,985
Other	3,405			1,505
Total accounts payable from related parties:	$	33,373		$	27,177
Net imbalance receivable from (payable to) Enterprise	$	(780	)	$	1,360

On January 18, 2012, Enterprise sold a significant portion of its ownership in ETE's common units. Subsequent to that transaction Enterprise owns less than 5% of ETE's outstanding common units.

Effective August 17, 2009, we acquired 100% of the membership interests of ETG, which owns all of the partnership interests of Energy Transfer Technologies, Ltd. (“ETT”). ETT provides compression services to customers engaged in the transportation of natural gas, including ETP. The membership interests of ETG were contributed to us by our Chief Executive Officer and by two entities, one of which is controlled by a director of our General Partner’s general partner and the other of which is controlled by a member of ETP’s management. In exchange, the former members acquired the right to receive (in cash or Common Units) future amounts to be determined based on the terms of the contribution arrangement. These contingent amounts are to be determined in 2014 and 2017, and the former members of ETG may receive payments contingent on the acquired operations performing at a level above the average return required by ETP for approval of its own growth projects during the period since acquisition. In addition, the former members may be required to make cash payments to us under certain circumstances. We have not accrued any contingent payments related to this agreement.

Subsequent to the acquisition of ETG, we pay $4.7 million in operating lease payments per year to the former owners for the use of compressor equipment through 2017.