Insurance Matters

3 Months Ended

Mar. 31, 2013

Significant Risks and Uncertainties [Abstract]

Significant Risks and Uncertainties

Note 15.  Insurance Matters

We participate as a named insured in EPCO's insurance program, which provides us with property damage, business interruption and other insurance coverage, the scope and amounts of which we believe are customary and prudent for the nature and extent of our operations.  While we believe EPCO maintains adequate insurance coverage on our behalf, insurance may not fully cover every type of damage, interruption or other loss that might occur. 

We expect to forego windstorm coverage for our Gulf of Mexico offshore assets during the upcoming 2013 hurricane season, which extends from June through November.  The combination of increasingly high deductibles and proposed premiums resulted in such coverage being uneconomic to us.  Although EPCO's coverage may not provide any windstorm coverage for offshore assets during the upcoming annual policy period that begins on June 1, producers affiliated with our Independence Hub and Marco Polo platforms will continue to provide certain levels of physical damage windstorm coverage for each of these key offshore assets.

We received $8.8 million of nonrefundable insurance proceeds during the three months ended March 31, 2013 attributable to property damage claims we filed in connection with a  February 2011 NGL release and fire at the West Storage location of our Mont Belvieu, Texas underground storage facility.  We remain in negotiation with our insurance carriers regarding the remaining West Storage claims, which are currently estimated at $91.9 million. Operating income for the first quarter of 2013 includes $8.8 million of gains related to these insurance recoveries.  To the extent that additional non-refundable insurance proceeds related to this incident are received, we expect to record gains equal to such proceeds.