EQUITY INVESTMENTS

3 Months Ended

Mar. 31, 2017

NOTE 4 EQUITY INVESTMENTS

Northern Border, Great Lakes and PNGTS are regulated by FERC and are operated by TransCanada. The Partnership uses the equity method of accounting for its interests in its equity investees. The Partnership’s equity investments are held through our ILPs that are considered to be variable interest entities (VIEs) (refer to Note 16).

	Ownership		Equity Earnings		Equity Investments
	Interest at		Three months
(unaudited)	March 31,		ended March 31,		March 31,	December 31,
(millions of dollars)	2017		2017	2016	2017	2016

Northern Border(a)	50	%	19	18	441	444
Great Lakes	46.45	%	17	15	489	474
PNGTS (b)	49.9	%	7	9	132	126

			43	42	1,062	1,044

(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.

(b)

For the three months ending March 31, 2017 and 2016, the Partnership recorded no undistributed earnings from PNGTS.

Northern Border

The Partnership did not have undistributed earnings from Northern Border for the three months ended March 31, 2017 and 2016.

The summarized financial information for Northern Border is as follows:

(unaudited)
(millions of dollars)	March 31, 2017		December 31, 2016

ASSETS
Cash and cash equivalents	18		14
Other current assets	36		36
Plant, property and equipment, net	1,085		1,089
Other assets	15		14

	1,154		1,153


LIABILITIES AND PARTNERS’ EQUITY
Current liabilities	44		38
Deferred credits and other	29		28
Long-term debt, including current maturities, net	430		430
Partners’ equity
Partners’ capital	653		659
Accumulated other comprehensive loss	(2	)	(2	)

	1,154		1,153

	Three months ended
(unaudited)	March 31,
(millions of dollars)	2017		2016

Transmission revenues	74		74
Operating expenses	(17	)	(16	)
Depreciation	(15	)	(15	)
Financial charges and other	(4	)	(6	)

Net income	38		37

Great Lakes

The Partnership made an equity contribution to Great Lakes of $4 million in the first quarter of 2017. 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 did not have undistributed earnings from Great Lakes for the three months ended March 31, 2017 and 2016.

The summarized financial information for Great Lakes is as follows:

(unaudited)
(millions of dollars)	March 31, 2017	December 31, 2016

ASSETS
Current assets	86	66
Plant, property and equipment, net	708	714

	794	780


LIABILITIES AND PARTNERS’ EQUITY
Current liabilities	31	40
Long-term debt, including current maturities, net	269	278
Partners’ equity	494	462

	794	780

	Three months ended
(unaudited)	March 31,
(millions of dollars)	2017		2016

Transmission revenues	63		61
Operating expenses	(14	)	(15	)
Depreciation	(7	)	(7	)
Financial charges and other	(5	)	(6	)

Net income	37		33