INVESTMENTS IN UNCONSOLIDATED AFFILIATES

3 Months Ended

Mar. 31, 2015

INVESTMENTS IN UNCONSOLIDATED AFFILIATES

INVESTMENTS IN UNCONSOLIDATED AFFILIATES

NOTE 4INVESTMENTS IN UNCONSOLIDATED AFFILIATES

Northern Border and Great Lakes are regulated by FERC and are operated by TransCanada. The Partnership uses the equity method of accounting for its interests in its equity investees.

	Ownership	Equity Earnings from Unconsolidated Affiliates		Investments in Unconsolidated Affiliates
	Interest at	Three months
(unaudited)	March 31,	ended March 31,		March 31,	December 31,
(millions of dollars)	2015	2015	2014	2015	2014
Northern Border(a)	50%	20	23	503	505
Great Lakes	46.45%	11	10	680	672
		31	33	1,183	1,177

(a) Equity earnings from Northern Border is net of the 12-year amortization of a $10 million transaction fee paid to the operator of Northern Border at the time of the Partnership’s additional 20 percent interest acquisition in April 2006.

Northern Border

The Partnership recorded no undistributed earnings from Northern Border for the three months ended March 31, 2015 and 2014.

The summarized financial information for Northern Border is as follows:

(unaudited)
(millions of dollars)	March 31, 2015		December 31, 2014
ASSETS
Cash and cash equivalents	51		41
Other current assets	36		34
Plant, property and equipment, net	1,150		1,163
Other assets	33		34
	1,270		1,272
LIABILITIES AND PARTNERS’ EQUITY
Current liabilities	65		64
Deferred credits and other	23		22
Long-term debt, including current maturities	411		411
Partners’ equity
Partners’ capital	773		777
Accumulated other comprehensive loss	(2	)	(2	)
	1,270		1,272

	Three months ended
(unaudited)	March 31,
(millions of dollars)	2015		2014
Transmission revenues	75		86
Operating expenses	(16	)	(18	)
Depreciation	(15	)	(15	)
Financial charges and other	(5	)	(6	)
Net income	39		47

Great Lakes

The Partnership made an equity contribution to Great Lakes of $4 million in the first quarter of 2015. This amount represents the Partnership’s 46.45 percent share of a $9 million cash call from Great Lakes to make a scheduled debt repayment.

The Partnership recorded no undistributed earnings from Great Lakes for the three months ended March 31, 2015 and 2014.

The summarized financial information for Great Lakes is as follows:

(unaudited)
(millions of dollars)	March 31, 2015	December 31, 2014
ASSETS
Current assets	88	66
Plant, property and equipment, net	741	748
	829	814
LIABILITIES AND PARTNERS’ EQUITY
Current liabilities	45	38
Long-term debt, including current maturities	307	316
Partners’ equity	477	460
	829	814

	Three months ended
(unaudited)	March 31,
(millions of dollars)	2015		2014
Transmission revenues	48		48
Operating expenses	(11	)	(12	)
Depreciation	(7	)	(7	)
Financial charges and other	(6	)	(7	)
Net income	24		22