Debt Obligations

6 Months Ended

Jun. 30, 2019

Debt Obligations [Abstract]

Debt Obligations

Note 7.  Debt Obligations

The following table presents our consolidated debt obligations (arranged by company and maturity date) at the dates indicated:

	June 30, 2019			December 31, 2018
EPO senior debt obligations:
Commercial Paper Notes, variable-rates (1)	$	1,425.0		$	–
Senior Notes N, 6.50% fixed-rate, due January 2019		–			700.0
364-Day Revolving Credit Agreement, variable-rate, due September 2019		–			–
Senior Notes LL, 2.55% fixed-rate, due October 2019 (1)		800.0			800.0
Senior Notes Q, 5.25% fixed-rate, due January 2020		500.0			500.0
Senior Notes Y, 5.20% fixed-rate, due September 2020		1,000.0			1,000.0
Senior Notes TT, 2.80% fixed-rate, due February 2021		750.0			750.0
Senior Notes RR, 2.85% fixed-rate, due April 2021		575.0			575.0
Senior Notes VV, 3.50% fixed-rate, due February 2022		750.0			750.0
Senior Notes CC, 4.05% fixed-rate, due February 2022		650.0			650.0
Multi-Year Revolving Credit Facility, variable-rate, due September 2022		–			–
Senior Notes HH, 3.35% fixed-rate, due March 2023		1,250.0			1,250.0
Senior Notes JJ, 3.90% fixed-rate, due February 2024		850.0			850.0
Senior Notes MM, 3.75% fixed-rate, due February 2025		1,150.0			1,150.0
Senior Notes PP, 3.70% fixed-rate, due February 2026		875.0			875.0
Senior Notes SS, 3.95% fixed-rate, due February 2027		575.0			575.0
Senior Notes WW, 4.15% fixed-rate, due October 2028		1,000.0			1,000.0
Senior Notes D, 6.875% fixed-rate, due March 2033		500.0			500.0
Senior Notes H, 6.65% fixed-rate, due October 2034		350.0			350.0
Senior Notes J, 5.75% fixed-rate, due March 2035		250.0			250.0
Senior Notes W, 7.55% fixed-rate, due April 2038		399.6			399.6
Senior Notes R, 6.125% fixed-rate, due October 2039		600.0			600.0
Senior Notes Z, 6.45% fixed-rate, due September 2040		600.0			600.0
Senior Notes BB, 5.95% fixed-rate, due February 2041		750.0			750.0
Senior Notes DD, 5.70% fixed-rate, due February 2042		600.0			600.0
Senior Notes EE, 4.85% fixed-rate, due August 2042		750.0			750.0
Senior Notes GG, 4.45% fixed-rate, due February 2043		1,100.0			1,100.0
Senior Notes II, 4.85% fixed-rate, due March 2044		1,400.0			1,400.0
Senior Notes KK, 5.10% fixed-rate, due February 2045		1,150.0			1,150.0
Senior Notes QQ, 4.90% fixed-rate, due May 2046		975.0			975.0
Senior Notes UU, 4.25% fixed-rate, due February 2048		1,250.0			1,250.0
Senior Notes XX, 4.80% fixed-rate, due February 2049		1,250.0			1,250.0
Senior Notes NN, 4.95% fixed-rate, due October 2054		400.0			400.0
TEPPCO senior debt obligations:
TEPPCO Senior Notes, 7.55% fixed-rate, due April 2038		0.4			0.4
Total principal amount of senior debt obligations		24,475.0			23,750.0
EPO Junior Subordinated Notes C, variable-rate, due June 2067 (2)		232.2			256.4
EPO Junior Subordinated Notes D, fixed/variable-rate, due August 2077 (3)		700.0			700.0
EPO Junior Subordinated Notes E, fixed/variable-rate, due August 2077 (4)		1,000.0			1,000.0
EPO Junior Subordinated Notes F, fixed/variable-rate, due February 2078 (5)		700.0			700.0
TEPPCO Junior Subordinated Notes, variable-rate, due June 2067 (2)		14.2			14.2
Total principal amount of senior and junior debt obligations		27,121.4			26,420.6
Other, non-principal amounts		(236.4	)		(242.4	)
Less current maturities of debt (1)		(500.0	)		(1,500.1	)
Total long-term debt	$	26,385.0		$	24,678.1

(1)	In accordance with ASC 470, Debt, long-term and current maturities of debt reflect the classification of such obligations at June 30, 2019 after taking into consideration EPO's issuance of senior notes in July 2019.
(2)	Variable rate is reset quarterly and based on 3-month LIBOR, or London Inter-Bank Offered Rate, plus 2.778%. During the second quarter of 2019, EPO repurchased and retired $24.2 million in principal amount of these junior subordinated notes.
(3)	Fixed rate of 4.875% through August 15, 2022; thereafter, a variable rate reset quarterly and based on 3-month LIBOR plus 2.986%.
(4)	Fixed rate of 5.250% through August 15, 2027; thereafter, a variable rate reset quarterly and based on 3-month LIBOR plus 3.033%.
(5)	Fixed rate of 5.375% through February 14, 2028; thereafter, a variable rate reset quarterly and based on 3-month LIBOR plus 2.57%.

References to “TEPPCO” mean TEPPCO Partners, L.P. prior to its merger with one of our wholly owned subsidiaries in October 2009.

The following table presents the range of interest rates and weighted-average interest rates paid on our consolidated variable-rate debt during the six months ended June 30, 2019:

	Range of Interest Rates Paid	Weighted-Average Interest Rate Paid
Commercial Paper Notes	2.59% to 2.80%	2.72%
EPO Junior Subordinated Notes C and TEPPCO Junior Subordinated Notes	5.30% to 5.52%	5.42%

Amounts borrowed under our 364-Day and Multi-Year Revolving Credit Facilities bear interest, at our election, equal to: (i) LIBOR, plus an additional variable spread; or (ii) an alternate base rate, which is the greater of (a) the Prime Rate in effect on such day, (b) the Federal Funds Effective Rate in effect on such day plus 0.5%, or (c) the LIBO Market Index Rate in effect on such day plus 1% and a variable spread. The applicable spreads are determined based on our debt ratings.

Issuance of $2.5 Billion of Senior Notes in July 2019

In July 2019, EPO issued $2.5 billion aggregate principal amount of senior notes comprised of $1.25 billion principal amount of senior notes due July 2029 (“Senior Notes YY”) and $1.25 billion principal amount of senior notes due January 2050 (“Senior Notes ZZ”).  Net proceeds from this offering were used by EPO for (i) the repayment of debt, including the temporary repayment of amounts outstanding under its commercial paper program and the future payment of $800 million principal amount of its Senior Notes LL due October 2019 at their maturity, and (ii) for general company purposes, including for growth capital expenditures.

Senior Notes YY were issued at 99.955% of their principal amount and have a fixed interest rate of 3.125% per year.  Senior Notes ZZ were issued at 99.792% of their principal amount and have a fixed interest rate of 4.20% per year. EPD has guaranteed the senior notes through an unconditional guarantee on an unsecured and unsubordinated basis.

After taking into account EPO’s issuance of Senior Notes YY and Senior Notes ZZ in July 2019 and the expected use of net proceeds, the following table presents the scheduled contractual maturities of principal amounts of our consolidated debt obligations for the next five years and in total thereafter:

			Scheduled Maturities of Debt
	Total		Remainder of 2019		2020		2021		2022		2023		Thereafter
Principal amount of senior and junior debt obligations at     June 30, 2019	$	27,121.4	$	–	$	1,500.0	$	1,325.0	$	1,400.0	$	1,250.0	$	21,646.4

Parent-Subsidiary Guarantor Relationships

EPD acts as guarantor of the consolidated debt obligations of EPO, with the exception of the remaining debt obligations of TEPPCO.  If EPO were to default on any of its guaranteed debt, EPD would be responsible for full and unconditional repayment of that obligation.

Partial Retirement of Junior Subordinated Notes During Second Quarter of 2019

During the second quarter of 2019, EPO repurchased and retired $24.2 million in principal amount of its Junior Subordinated Notes C.  A $1.5 million gain on the extinguishment of these debt obligations is included in “Other, net” on our Unaudited Condensed Statements of Consolidated Operations.

Lender Financial Covenants

We were in compliance with the financial covenants of our consolidated debt agreements at June 30, 2019.

Letters of Credit

At June 30, 2019, EPO had $101.4 million of letters of credit outstanding primarily related to our commodity hedging activities.