x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended September 30, 2011 |
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from _______ to _______ |
Delaware | 74-2956831 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |
2330 North Loop 1604 West San Antonio, Texas | 78248 | |
(Address of principal executive offices) | (Zip Code) |
Large accelerated filer | x | Accelerated filer | £ | ||
Non-accelerated filer | o (Do not check if a smaller reporting company) | Smaller reporting company | £ |
Item 1. | ||
Item 2. | ||
Item 3. | ||
Item 4. | ||
Item 1. | ||
Item 6. | ||
Item 1. | Financial Statements |
September 30, 2011 | December 31, 2010 | ||||||
(Unaudited) | |||||||
Assets | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 59,214 | $ | 181,121 | |||
Accounts receivable, net of allowance for doubtful accounts of $1,742 and $1,457 as of September 30, 2011 and December 31, 2010, respectively | 467,912 | 302,053 | |||||
Inventories | 603,683 | 413,537 | |||||
Other current assets | 69,101 | 42,796 | |||||
Total current assets | 1,199,910 | 939,507 | |||||
Property, plant and equipment, at cost | 4,328,975 | 4,021,319 | |||||
Accumulated depreciation and amortization | (943,539 | ) | (833,862 | ) | |||
Property, plant and equipment, net | 3,385,436 | 3,187,457 | |||||
Intangible assets, net | 42,499 | 43,033 | |||||
Goodwill | 846,526 | 813,270 | |||||
Investment in joint venture | 67,203 | 69,603 | |||||
Deferred income tax asset | 9,671 | 8,138 | |||||
Other long-term assets, net | 296,903 | 325,385 | |||||
Total assets | $ | 5,848,148 | $ | 5,386,393 | |||
Liabilities and Partners’ Equity | |||||||
Current liabilities: | |||||||
Current portion of long-term debt | $ | 355,645 | $ | 832 | |||
Accounts payable | 461,038 | 282,382 | |||||
Payable to related party | 12,369 | 10,345 | |||||
Accrued interest payable | 23,615 | 29,706 | |||||
Accrued liabilities | 110,934 | 57,953 | |||||
Taxes other than income tax | 16,499 | 10,718 | |||||
Income tax payable | 2,959 | 1,293 | |||||
Total current liabilities | 983,059 | 393,229 | |||||
Long-term debt, less current portion | 2,170,010 | 2,136,248 | |||||
Long-term payable to related party | 11,871 | 10,088 | |||||
Deferred income tax liability | 35,917 | 29,565 | |||||
Other long-term liabilities | 122,242 | 114,563 | |||||
Commitments and contingencies (Note 5) | |||||||
Partners’ equity: | |||||||
Limited partners (64,670,520 and 64,610,549 common units outstanding as of September 30, 2011 and December 31, 2010, respectively) | 2,553,995 | 2,598,873 | |||||
General partner | 56,284 | 57,327 | |||||
Accumulated other comprehensive (loss) income | (97,912 | ) | 46,500 | ||||
Total NuStar Energy L.P. partners' equity | 2,512,367 | 2,702,700 | |||||
Noncontrolling interest | 12,682 | — | |||||
Total partners’ equity | 2,525,049 | 2,702,700 | |||||
Total liabilities and partners’ equity | $ | 5,848,148 | $ | 5,386,393 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2011 | 2010 | 2011 | 2010 | ||||||||||||
Revenues: | |||||||||||||||
Service revenues: | |||||||||||||||
Third parties | $ | 210,395 | $ | 201,390 | $ | 607,866 | $ | 585,772 | |||||||
Related party | 286 | — | 823 | — | |||||||||||
Total service revenues | 210,681 | 201,390 | 608,689 | 585,772 | |||||||||||
Product sales | 1,613,669 | 936,989 | 4,039,461 | 2,623,077 | |||||||||||
Total revenues | 1,824,350 | 1,138,379 | 4,648,150 | 3,208,849 | |||||||||||
Costs and expenses: | |||||||||||||||
Cost of product sales | 1,535,609 | 860,942 | 3,797,424 | 2,422,751 | |||||||||||
Operating expenses: | |||||||||||||||
Third parties | 98,464 | 86,104 | 281,419 | 259,465 | |||||||||||
Related party | 37,151 | 35,644 | 109,061 | 103,563 | |||||||||||
Total operating expenses | 135,615 | 121,748 | 390,480 | 363,028 | |||||||||||
General and administrative expenses: | |||||||||||||||
Third parties | 8,746 | 9,727 | 27,865 | 28,633 | |||||||||||
Related party | 8,985 | 17,133 | 41,968 | 47,691 | |||||||||||
Total general and administrative expenses | 17,731 | 26,860 | 69,833 | 76,324 | |||||||||||
Depreciation and amortization expense | 42,418 | 38,539 | 124,354 | 114,653 | |||||||||||
Total costs and expenses | 1,731,373 | 1,048,089 | 4,382,091 | 2,976,756 | |||||||||||
Operating income | 92,977 | 90,290 | 266,059 | 232,093 | |||||||||||
Equity in earnings of joint venture | 2,599 | 2,454 | 6,997 | 7,571 | |||||||||||
Interest expense, net | (21,565 | ) | (20,583 | ) | (62,644 | ) | (58,059 | ) | |||||||
Other income (expense), net | 767 | (235 | ) | (5,699 | ) | 14,882 | |||||||||
Income before income tax expense | 74,778 | 71,926 | 204,713 | 196,487 | |||||||||||
Income tax expense | 4,497 | 3,616 | 13,311 | 9,052 | |||||||||||
Net income | 70,281 | 68,310 | 191,402 | 187,435 | |||||||||||
Less net income attributable to noncontrolling interest | 123 | — | 143 | — | |||||||||||
Net income attributable to NuStar Energy L.P. | $ | 70,158 | $ | 68,310 | $ | 191,259 | $ | 187,435 | |||||||
Net income per unit applicable to limited partners (Note 11) | $ | 0.92 | $ | 0.90 | $ | 2.49 | $ | 2.55 | |||||||
Weighted-average limited partner units outstanding | 64,612,423 | 64,610,549 | 64,611,181 | 62,386,373 |
Nine Months Ended September 30, | |||||||
2011 | 2010 | ||||||
Cash Flows from Operating Activities: | |||||||
Net income | $ | 191,402 | $ | 187,435 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Depreciation and amortization expense | 124,354 | 114,653 | |||||
Amortization of debt related items | (8,328 | ) | (5,812 | ) | |||
Gain on sale or disposition of assets, including insurance recoveries | (117 | ) | (12,926 | ) | |||
Deferred income tax expense (benefit) | 4,130 | (1,932 | ) | ||||
Equity in earnings of joint venture | (6,997 | ) | (7,571 | ) | |||
Distributions of equity in earnings of joint venture | 9,397 | 7,500 | |||||
Changes in current assets and current liabilities (Note 12) | (216,427 | ) | (99,815 | ) | |||
Other, net | 4,457 | (699 | ) | ||||
Net cash provided by operating activities | 101,871 | 180,833 | |||||
Cash Flows from Investing Activities: | |||||||
Reliability capital expenditures | (32,808 | ) | (34,927 | ) | |||
Strategic capital expenditures | (211,150 | ) | (156,531 | ) | |||
Acquisitions | (100,693 | ) | (43,026 | ) | |||
Proceeds from insurance recoveries | — | 13,500 | |||||
Investment in other long-term assets | (8,449 | ) | (3,400 | ) | |||
Proceeds from sale or disposition of assets | 445 | 1,992 | |||||
Net cash used in investing activities | (352,655 | ) | (222,392 | ) | |||
Cash Flows from Financing Activities: | |||||||
Proceeds from long-term debt borrowings | 707,102 | 775,434 | |||||
Proceeds from short-term debt borrowings | 31,600 | 177,041 | |||||
Proceeds from senior note offering, net of issuance costs | — | 445,574 | |||||
Long-term debt repayments | (348,153 | ) | (1,146,183 | ) | |||
Short-term debt repayments | (31,600 | ) | (197,041 | ) | |||
Proceeds from issuance of common units, net of issuance costs | 1,583 | 240,158 | |||||
Contributions from general partner | 70 | 5,078 | |||||
Distributions to unitholders and general partner | (240,571 | ) | (225,538 | ) | |||
Proceeds from termination of interest rate swaps | 12,632 | — | |||||
Other, net | (785 | ) | (8,746 | ) | |||
Net cash provided by financing activities | 131,878 | 65,777 | |||||
Effect of foreign exchange rate changes on cash | (3,001 | ) | (358 | ) | |||
Net (decrease) increase in cash and cash equivalents | (121,907 | ) | 23,860 | ||||
Cash and cash equivalents as of the beginning of the period | 181,121 | 62,006 | |||||
Cash and cash equivalents as of the end of the period | $ | 59,214 | $ | 85,866 |
September 30, 2011 | December 31, 2010 | ||||||
(Thousands of Dollars) | |||||||
Crude oil | $ | 220,672 | $ | 122,945 | |||
Finished products | 372,841 | 281,197 | |||||
Materials and supplies | 10,170 | 9,395 | |||||
Total | $ | 603,683 | $ | 413,537 |
September 30, 2011 | |||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
(Thousands of Dollars) | |||||||||||||||
Other current assets: | |||||||||||||||
Product imbalances | $ | 1,903 | $ | — | $ | — | $ | 1,903 | |||||||
Commodity derivatives | 22,534 | — | — | 22,534 | |||||||||||
Other long-term assets, net: | |||||||||||||||
Interest rate swaps | — | 23,125 | — | 23,125 | |||||||||||
Accrued liabilities: | |||||||||||||||
Product imbalances | (1,069 | ) | — | — | (1,069 | ) | |||||||||
Commodity derivatives | (8,265 | ) | (50,433 | ) | — | (58,698 | ) | ||||||||
Interest rate swaps | — | (18,624 | ) | — | (18,624 | ) | |||||||||
Other long-term liabilities: | |||||||||||||||
Interest rate swaps | — | (22,306 | ) | — | (22,306 | ) | |||||||||
Total | $ | 15,103 | $ | (68,238 | ) | $ | — | $ | (53,135 | ) |
December 31, 2010 | |||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
(Thousands of Dollars) | |||||||||||||||
Other current assets: | |||||||||||||||
Product imbalances | $ | 991 | $ | — | $ | — | $ | 991 | |||||||
Other long-term assets, net: | |||||||||||||||
Interest rate swaps | — | 45,663 | — | 45,663 | |||||||||||
Accrued liabilities: | |||||||||||||||
Product imbalances | (988 | ) | — | — | (988 | ) | |||||||||
Commodity derivatives | (14,741 | ) | — | — | (14,741 | ) | |||||||||
Other long-term liabilities: | |||||||||||||||
Interest rate swaps | — | (29,483 | ) | — | (29,483 | ) | |||||||||
Total | $ | (14,738 | ) | $ | 16,180 | $ | — | $ | 1,442 |
September 30, 2011 | December 31, 2010 | ||||||
(Thousands of Dollars) | |||||||
Fair value | $ | 2,595,533 | $ | 2,249,190 | |||
Carrying amount | $ | 2,525,655 | $ | 2,137,080 |
Asset Derivatives | Liability Derivatives | ||||||||||||||||
Balance Sheet Location | September 30, 2011 | December 31, 2010 | September 30, 2011 | December 31, 2010 | |||||||||||||
(Thousands of Dollars) | |||||||||||||||||
Derivatives Designated as Hedging Instruments: | |||||||||||||||||
Commodity contracts | Other current assets | $ | 3,072 | $ | — | $ | (72 | ) | $ | — | |||||||
Interest rate swaps | Other long-term assets, net | 23,125 | 45,663 | — | — | ||||||||||||
Commodity contracts | Accrued liabilities | 196,026 | 2,176 | (246,459 | ) | (2,522 | ) | ||||||||||
Interest rate swaps | Accrued liabilities | — | — | (18,624 | ) | — | |||||||||||
Interest rate swaps | Other long-term liabilities | — | — | (22,306 | ) | (29,483 | ) | ||||||||||
Total | 222,223 | 47,839 | (287,461 | ) | (32,005 | ) | |||||||||||
Derivatives Not Designated as Hedging Instruments: | |||||||||||||||||
Commodity contracts | Other current assets | 38,774 | — | (19,240 | ) | — | |||||||||||
Commodity contracts | Accrued liabilities | 10,826 | 46,632 | (19,091 | ) | (61,027 | ) | ||||||||||
Total | 49,600 | 46,632 | (38,331 | ) | (61,027 | ) | |||||||||||
Total Derivatives | $ | 271,823 | $ | 94,471 | $ | (325,792 | ) | $ | (93,032 | ) |
Derivatives Designated as Fair Value Hedging Instruments | Income Statement Location | Amount of Gain (Loss) Recognized in Income on Derivative (Effective Portion) | Amount of Gain (Loss) Recognized in Income on Hedged Item | Amount of Gain (Loss) Recognized in Income on Derivative (Ineffective Portion) | ||||||||||
(Thousands of Dollars) | ||||||||||||||
Three months ended September 30, 2011: | ||||||||||||||
Interest rate swaps | Interest expense, net | $ | 45,963 | $ | (46,320 | ) | $ | (357 | ) | |||||
Commodity contracts | Cost of product sales | 3,772 | (4,508 | ) | (736 | ) | ||||||||
Total | $ | 49,735 | $ | (50,828 | ) | $ | (1,093 | ) | ||||||
Three months ended September 30, 2010: | ||||||||||||||
Interest rate swaps | Interest expense, net | $ | 3,886 | $ | (3,886 | ) | $ | — | ||||||
Commodity contracts | Cost of product sales | (6,773 | ) | 12,297 | 5,524 | |||||||||
Total | $ | (2,887 | ) | $ | 8,411 | $ | 5,524 | |||||||
Nine months ended September 30, 2011: | ||||||||||||||
Interest rate swaps | Interest expense, net | $ | 54,577 | $ | (55,172 | ) | $ | (595 | ) | |||||
Commodity contracts | Cost of product sales | (7,292 | ) | 6,212 | (1,080 | ) | ||||||||
Total | $ | 47,285 | $ | (48,960 | ) | $ | (1,675 | ) | ||||||
Nine months ended September 30, 2010: | ||||||||||||||
Interest rate swaps | Interest expense, net | $ | 7,010 | $ | (7,010 | ) | $ | — | ||||||
Commodity contracts | Cost of product sales | 4,961 | 3,382 | 8,343 | ||||||||||
Total | $ | 11,971 | $ | (3,628 | ) | $ | 8,343 |
Derivatives Designated as Cash Flow Hedging Instruments | Amount of Gain (Loss) Recognized in OCI on Derivative (Effective Portion) | Income Statement Location (a) | Amount of Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) | Amount of Gain (Loss) Recognized in Income on Derivative (Ineffective Portion) | ||||||||||
(Thousands of Dollars) | (Thousands of Dollars) | |||||||||||||
Three months ended September 30, 2011: | ||||||||||||||
Interest rate swaps | $ | (63,100 | ) | Interest expense, net | $ | — | $ | — | ||||||
Commodity contracts | (46,532 | ) | Cost of product sales | (7,733 | ) | 3,594 | ||||||||
Total | $ | (109,632 | ) | $ | (7,733 | ) | $ | 3,594 | ||||||
Three months ended September 30, 2010: | ||||||||||||||
Interest rate swaps | $ | (1,790 | ) | Interest expense, net | $ | — | $ | — | ||||||
Commodity contracts | (1,326 | ) | Cost of product sales | — | (284 | ) | ||||||||
Total | $ | (3,116 | ) | $ | — | $ | (284 | ) | ||||||
Nine months ended September 30, 2011: | ||||||||||||||
Interest rate swaps | $ | (75,930 | ) | Interest expense, net | $ | — | $ | — | ||||||
Commodity contracts | (62,986 | ) | Cost of product sales | (8,958 | ) | 3,594 | ||||||||
Total | $ | (138,916 | ) | $ | (8,958 | ) | $ | 3,594 | ||||||
Nine months ended September 30, 2010: | ||||||||||||||
Interest rate swaps | $ | (1,790 | ) | Interest expense, net | $ | — | $ | — | ||||||
Commodity contracts | (1,087 | ) | Cost of product sales | (913 | ) | — | ||||||||
Total | $ | (2,877 | ) | $ | (913 | ) | $ | — |
(a) | Amounts are included in specified location for both the gain (loss) reclassified from accumulated other comprehensive income into income (effective portion) and the gain (loss) recognized in income on derivative (ineffective portion). |
Derivatives Not Designated as Hedging Instruments | Income Statement Location | Amount of Gain (Loss) Recognized in Income | ||||
(Thousands of Dollars) | ||||||
Three months ended September 30, 2011: | ||||||
Commodity contracts | Cost of product sales | $ | 5,482 | |||
Three months ended September 30, 2010: | ||||||
Commodity contracts | Cost of product sales | $ | (1,963 | ) | ||
Nine months ended September 30, 2011: | ||||||
Commodity contracts | Revenues | $ | 235 | |||
Commodity contracts | Cost of product sales | (5,685 | ) | |||
Commodity contracts | Operating expenses | 46 | ||||
Total | $ | (5,404 | ) | |||
Nine months ended September 30, 2010: | ||||||
Commodity contracts | Cost of product sales | $ | 4,735 | |||
Commodity contracts | Operating expenses | (10 | ) | |||
Total | $ | 4,725 |
The following table summarizes information pertaining to related party transactions: | |||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2011 | 2010 | 2011 | 2010 | ||||||||||||
(Thousands of Dollars) | |||||||||||||||
Revenues | $ | 286 | $ | — | $ | 823 | $ | — | |||||||
Operating expenses | $ | 37,151 | $ | 35,644 | $ | 109,061 | $ | 103,563 | |||||||
General and administrative expenses | $ | 8,985 | $ | 17,133 | $ | 41,968 | $ | 47,691 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2011 | 2010 | 2011 | 2010 | ||||||||||||
(Thousands of Dollars) | |||||||||||||||
Contingent loss adjustment | $ | (3,250 | ) | $ | — | $ | (3,250 | ) | $ | — | |||||
Storage agreement early termination costs | — | — | (5,000 | ) | — | ||||||||||
Gain from insurance recoveries | — | — | — | 13,500 | |||||||||||
(Loss) gain from sale or disposition of assets | (119 | ) | 114 | 117 | (574 | ) | |||||||||
Foreign exchange gains (losses) | 3,059 | (333 | ) | 2,483 | (567 | ) | |||||||||
Other, net | 1,077 | (16 | ) | (49 | ) | 2,523 | |||||||||
Other income (expense), net | $ | 767 | $ | (235 | ) | $ | (5,699 | ) | $ | 14,882 |
Three Months Ended September 30, 2011 | Three Months Ended September 30, 2010 | ||||||||||||||||||||||
NuStar Energy L.P. Partners' Equity | Noncontrolling Interest | Total Partners' Equity | NuStar Energy L.P. Partners' Equity | Noncontrolling Interest | Total Partners' Equity | ||||||||||||||||||
(Thousands of Dollars) | |||||||||||||||||||||||
Beginning balance | $ | 2,644,221 | $ | 14,745 | $ | 2,658,966 | $ | 2,694,908 | $ | — | $ | 2,694,908 | |||||||||||
Net income | 70,158 | 123 | 70,281 | 68,310 | — | 68,310 | |||||||||||||||||
Other comprehensive income: | |||||||||||||||||||||||
Foreign currency translation adjustment | (22,165 | ) | (2,186 | ) | (24,351 | ) | 9,026 | — | 9,026 | ||||||||||||||
Unrealized gain (loss) on cash flow hedges | (109,632 | ) | — | (109,632 | ) | (3,116 | ) | — | (3,116 | ) | |||||||||||||
Net loss reclassified into income on cash flow hedges | 7,733 | — | 7,733 | — | — | — | |||||||||||||||||
Total other comprehensive (loss) income | (124,064 | ) | (2,186 | ) | (126,250 | ) | 5,910 | — | 5,910 | ||||||||||||||
Total comprehensive (loss) income | (53,906 | ) | (2,063 | ) | (55,969 | ) | 74,220 | — | 74,220 | ||||||||||||||
Cash distributions to partners | (81,339 | ) | — | (81,339 | ) | (78,754 | ) | — | (78,754 | ) | |||||||||||||
Issuance of common units, including contribution from general partner | 3,391 | — | 3,391 | (139 | ) | — | (139 | ) | |||||||||||||||
Ending balance | $ | 2,512,367 | $ | 12,682 | $ | 2,525,049 | $ | 2,690,235 | $ | — | $ | 2,690,235 |
Nine Months Ended September 30, 2011 | Nine Months Ended September 30, 2010 | ||||||||||||||||||||||
NuStar Energy L.P. Partners' Equity | Noncontrolling Interest | Total Partners' Equity | NuStar Energy L.P. Partners' Equity | Noncontrolling Interest | Total Partners' Equity | ||||||||||||||||||
(Thousands of Dollars) | |||||||||||||||||||||||
Beginning balance | $ | 2,702,700 | $ | — | $ | 2,702,700 | $ | 2,484,968 | $ | — | $ | 2,484,968 | |||||||||||
Turkey acquisition | — | 15,000 | 15,000 | — | — | ||||||||||||||||||
Net income | 191,259 | 143 | 191,402 | 187,435 | — | 187,435 | |||||||||||||||||
Other comprehensive income: | |||||||||||||||||||||||
Foreign currency translation adjustment | (14,454 | ) | (2,461 | ) | (16,915 | ) | 98 | — | 98 | ||||||||||||||
Unrealized gain (loss) on cash flow hedges | (138,916 | ) | — | (138,916 | ) | (2,877 | ) | — | (2,877 | ) | |||||||||||||
Net loss reclassified into income on cash flow hedges | 8,958 | — | 8,958 | 913 | — | 913 | |||||||||||||||||
Total other comprehensive (loss) | (144,412 | ) | (2,461 | ) | (146,873 | ) | (1,866 | ) | — | (1,866 | ) | ||||||||||||
Total comprehensive income (loss) | 46,847 | (2,318 | ) | 44,529 | 185,569 | — | 185,569 | ||||||||||||||||
Cash distributions to partners | (240,571 | ) | — | (240,571 | ) | (225,538 | ) | — | (225,538 | ) | |||||||||||||
Issuance of common units, including contribution from general partner | 3,391 | — | 3,391 | 245,236 | — | 245,236 | |||||||||||||||||
Ending balance | $ | 2,512,367 | $ | 12,682 | $ | 2,525,049 | $ | 2,690,235 | $ | — | $ | 2,690,235 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2011 | 2010 | 2011 | 2010 | ||||||||||||
(Thousands of Dollars) | |||||||||||||||
Net income attributable to NuStar Energy L.P. | $ | 70,158 | $ | 68,310 | $ | 191,259 | $ | 187,435 | |||||||
Less general partner incentive distribution | 8,972 | 8,568 | 26,503 | 24,736 | |||||||||||
Net income after general partner incentive distribution | 61,186 | 59,742 | 164,756 | 162,699 | |||||||||||
General partner interest | 2 | % | 2 | % | 2 | % | 2 | % | |||||||
General partner allocation of net income after general partner incentive distribution | 1,223 | 1,195 | 3,294 | 3,254 | |||||||||||
General partner incentive distribution | 8,972 | 8,568 | 26,503 | 24,736 | |||||||||||
Net income applicable to general partner | $ | 10,195 | $ | 9,763 | $ | 29,797 | $ | 27,990 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2011 | 2010 | 2011 | 2010 | ||||||||||||
(Thousands of Dollars, Except Per Unit Data) | |||||||||||||||
General partner interest | $ | 1,628 | $ | 1,592 | $ | 4,847 | $ | 4,635 | |||||||
General partner incentive distribution | 8,972 | 8,568 | 26,503 | 24,736 | |||||||||||
Total general partner distribution | 10,600 | 10,160 | 31,350 | 29,371 | |||||||||||
Limited partners’ distribution | 70,814 | 69,456 | 211,019 | 202,391 | |||||||||||
Total cash distributions | $ | 81,414 | $ | 79,616 | $ | 242,369 | $ | 231,762 | |||||||
Cash distributions per unit applicable to limited partners | $ | 1.095 | $ | 1.075 | $ | 3.265 | $ | 3.205 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2011 | 2010 | 2011 | 2010 | ||||||||||||
(Thousands of Dollars, Except Unit and Per Unit Data) | |||||||||||||||
Net income attributable to NuStar Energy L.P. | $ | 70,158 | $ | 68,310 | $ | 191,259 | $ | 187,435 | |||||||
Less general partner distribution (including IDR) | 10,600 | 10,160 | 31,350 | 29,371 | |||||||||||
Less limited partner distribution | 70,814 | 69,456 | 211,019 | 202,391 | |||||||||||
Distributions greater than earnings | $ | (11,256 | ) | $ | (11,306 | ) | $ | (51,110 | ) | $ | (44,327 | ) | |||
General partner earnings: | |||||||||||||||
Distributions | $ | 10,600 | $ | 10,160 | $ | 31,350 | $ | 29,371 | |||||||
Allocation of distributions greater than earnings (2%) | (225 | ) | (225 | ) | (1,023 | ) | (886 | ) | |||||||
Total | $ | 10,375 | $ | 9,935 | $ | 30,327 | $ | 28,485 | |||||||
Limited partner earnings: | |||||||||||||||
Distributions | $ | 70,814 | $ | 69,456 | $ | 211,019 | $ | 202,391 | |||||||
Allocation of distributions greater than earnings (98%) | (11,031 | ) | (11,081 | ) | (50,087 | ) | (43,441 | ) | |||||||
Total | $ | 59,783 | $ | 58,375 | $ | 160,932 | $ | 158,950 | |||||||
Weighted-average limited partner units outstanding | 64,612,423 | 64,610,549 | 64,611,181 | 62,386,373 | |||||||||||
Net income per unit applicable to limited partners | $ | 0.92 | $ | 0.90 | $ | 2.49 | $ | 2.55 |
Nine Months Ended September 30, | |||||||
2011 | 2010 | ||||||
(Thousands of Dollars) | |||||||
Decrease (increase) in current assets: | |||||||
Accounts receivable | $ | (148,814 | ) | $ | (86,025 | ) | |
Inventories | (176,936 | ) | (114,885 | ) | |||
Other current assets | (25,838 | ) | 27,287 | ||||
Increase (decrease) in current liabilities: | |||||||
Accounts payable | 153,626 | 75,345 | |||||
Payable to related party | 2,023 | 12,697 | |||||
Accrued interest payable | (6,092 | ) | 3,058 | ||||
Accrued liabilities | (21,471 | ) | (18,436 | ) | |||
Taxes other than income tax | 5,607 | (858 | ) | ||||
Income tax payable | 1,468 | 2,002 | |||||
Changes in current assets and current liabilities | $ | (216,427 | ) | $ | (99,815 | ) |
Nine Months Ended September 30, | |||||||
2011 | 2010 | ||||||
(Thousands of Dollars) | |||||||
Cash paid for interest, net of amount capitalized | $ | 87,576 | $ | 66,243 | |||
Cash paid for income taxes, net of tax refunds received | $ | 11,974 | $ | 9,580 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2011 | 2010 | 2011 | 2010 | ||||||||||||
(Thousands of Dollars) | |||||||||||||||
Revenues: | |||||||||||||||
Storage: | |||||||||||||||
Third parties | $ | 128,561 | $ | 120,793 | $ | 381,460 | $ | 353,337 | |||||||
Intersegment | 13,042 | 10,344 | 35,925 | 33,241 | |||||||||||
Related party | 286 | — | 823 | — | |||||||||||
Total storage | 141,889 | 131,137 | 418,208 | 386,578 | |||||||||||
Transportation: | |||||||||||||||
Third parties | 81,834 | 80,597 | 226,406 | 232,435 | |||||||||||
Intersegment | 65 | — | 65 | 382 | |||||||||||
Total transportation | 81,899 | 80,597 | 226,471 | 232,817 | |||||||||||
Asphalt and fuels marketing: | |||||||||||||||
Third parties | 1,613,669 | 936,989 | 4,039,461 | 2,623,077 | |||||||||||
Intersegment | 5,024 | 85 | 9,618 | 2,917 | |||||||||||
Total asphalt and fuels marketing | 1,618,693 | 937,074 | 4,049,079 | 2,625,994 | |||||||||||
Consolidation and intersegment eliminations | (18,131 | ) | (10,429 | ) | (45,608 | ) | (36,540 | ) | |||||||
Total revenues | $ | 1,824,350 | $ | 1,138,379 | $ | 4,648,150 | $ | 3,208,849 | |||||||
Operating income: | |||||||||||||||
Storage | $ | 48,778 | $ | 45,635 | $ | 140,322 | $ | 131,388 | |||||||
Transportation | 38,248 | 37,512 | 102,808 | 106,004 | |||||||||||
Asphalt and fuels marketing | 25,418 | 35,457 | 97,689 | 75,113 | |||||||||||
Consolidation and intersegment eliminations | 29 | 1 | (16 | ) | 278 | ||||||||||
Total segment operating income | 112,473 | 118,605 | 340,803 | 312,783 | |||||||||||
Less general and administrative expenses | 17,731 | 26,860 | 69,833 | 76,324 | |||||||||||
Less other depreciation and amortization expense | 1,765 | 1,455 | 4,911 | 4,366 | |||||||||||
Total operating income | $ | 92,977 | $ | 90,290 | $ | 266,059 | $ | 232,093 |
September 30, 2011 | December 31, 2010 | ||||||
(Thousands of Dollars) | |||||||
Storage | $ | 2,556,356 | $ | 2,454,264 | |||
Transportation | 1,251,463 | 1,256,614 | |||||
Asphalt and fuels marketing | 1,655,442 | 1,154,499 | |||||
Total segment assets | 5,463,261 | 4,865,377 | |||||
Other partnership assets | 384,887 | 521,016 | |||||
Total consolidated assets | $ | 5,848,148 | $ | 5,386,393 |
NuStar Energy | NuStar Logistics | NuPOP | Non-Guarantor Subsidiaries (a) | Eliminations | Consolidated | ||||||||||||||||||
Assets | |||||||||||||||||||||||
Cash and cash equivalents | $ | 122 | $ | 6 | $ | — | $ | 59,086 | $ | — | $ | 59,214 | |||||||||||
Receivables, net | 1,738 | 17,781 | 12,425 | 435,968 | — | 467,912 | |||||||||||||||||
Inventories | — | 2,277 | 14,686 | 586,969 | (249 | ) | 603,683 | ||||||||||||||||
Other current assets | — | 13,429 | 2,378 | 53,294 | — | 69,101 | |||||||||||||||||
Intercompany receivable | — | 853,945 | 745,079 | — | (1,599,024 | ) | — | ||||||||||||||||
Total current assets | 1,860 | 887,438 | 774,568 | 1,135,317 | (1,599,273 | ) | 1,199,910 | ||||||||||||||||
Property, plant and equipment, net | — | 1,119,814 | 599,770 | 1,665,852 | — | 3,385,436 | |||||||||||||||||
Intangible assets, net | — | 2,001 | — | 40,498 | — | 42,499 | |||||||||||||||||
Goodwill | — | 18,094 | 170,652 | 657,780 | — | 846,526 | |||||||||||||||||
Investment in wholly owned subsidiaries | 3,119,736 | 249,458 | 1,137,467 | 2,315,991 | (6,822,652 | ) | — | ||||||||||||||||
Investment in joint venture | — | — | — | 67,203 | — | 67,203 | |||||||||||||||||
Deferred income tax asset | — | — | — | 9,671 | — | 9,671 | |||||||||||||||||
Other long-term assets, net | 217 | 227,657 | 26,329 | 42,700 | — | 296,903 | |||||||||||||||||
Total assets | $ | 3,121,813 | $ | 2,504,462 | $ | 2,708,786 | $ | 5,935,012 | $ | (8,421,925 | ) | $ | 5,848,148 | ||||||||||
Liabilities and Partners’ Equity | |||||||||||||||||||||||
Current portion of long-term debt | $ | — | $ | 102,510 | $ | 253,135 | $ | — | $ | — | $ | 355,645 | |||||||||||
Payables | 63 | 35,459 | 7,953 | 429,932 | — | 473,407 | |||||||||||||||||
Accrued interest payable | — | 16,273 | 7,318 | 24 | — | 23,615 | |||||||||||||||||
Accrued liabilities | 755 | 30,857 | 3,925 | 75,397 | — | 110,934 | |||||||||||||||||
Taxes other than income tax | 63 | 4,812 | 3,586 | 8,038 | — | 16,499 | |||||||||||||||||
Income tax payable | — | 1,462 | — | 1,497 | — | 2,959 | |||||||||||||||||
Intercompany payable | 510,653 | — | — | 1,088,371 | (1,599,024 | ) | — | ||||||||||||||||
Total current liabilities | 511,534 | 191,373 | 275,917 | 1,603,259 | (1,599,024 | ) | 983,059 | ||||||||||||||||
Long-term debt, less current portion | — | 1,883,485 | 253,709 | 32,816 | — | 2,170,010 | |||||||||||||||||
Long-term payable to related party | — | 5,390 | — | 6,481 | — | 11,871 | |||||||||||||||||
Deferred income tax liability | — | — | — | 35,917 | — | 35,917 | |||||||||||||||||
Other long-term liabilities | — | 25,299 | 245 | 96,698 | — | 122,242 | |||||||||||||||||
Total partners' equity | 2,610,279 | 398,915 | 2,178,915 | 4,159,841 | (6,822,901 | ) | 2,525,049 | ||||||||||||||||
Total liabilities and partners’ equity | $ | 3,121,813 | $ | 2,504,462 | $ | 2,708,786 | $ | 5,935,012 | $ | (8,421,925 | ) | $ | 5,848,148 |
(a) | Non-guarantor subsidiaries are wholly owned by NuStar Energy, NuStar Logistics or NuPOP. |
NuStar Energy | NuStar Logistics | NuPOP | Non-Guarantor Subsidiaries (a) | Eliminations | Consolidated | ||||||||||||||||||
Assets | |||||||||||||||||||||||
Cash and cash equivalents | $ | 53 | $ | 107,655 | $ | — | $ | 73,413 | $ | — | $ | 181,121 | |||||||||||
Receivables, net | — | 27,708 | 10,648 | 266,885 | (3,188 | ) | 302,053 | ||||||||||||||||
Inventories | — | 1,776 | 6,712 | 405,521 | (472 | ) | 413,537 | ||||||||||||||||
Other current assets | — | 10,116 | 1,202 | 31,478 | — | 42,796 | |||||||||||||||||
Intercompany receivable | — | 786,658 | 729,365 | — | (1,516,023 | ) | — | ||||||||||||||||
Total current assets | 53 | 933,913 | 747,927 | 777,297 | (1,519,683 | ) | 939,507 | ||||||||||||||||
Property, plant and equipment, net | — | 1,006,479 | 614,762 | 1,566,216 | — | 3,187,457 | |||||||||||||||||
Intangible assets, net | — | 2,106 | — | 40,927 | — | 43,033 | |||||||||||||||||
Goodwill | — | 18,094 | 170,652 | 624,524 | — | 813,270 | |||||||||||||||||
Investment in wholly owned subsidiaries | 3,167,764 | 159,813 | 994,249 | 2,112,355 | (6,434,181 | ) | — | ||||||||||||||||
Investment in joint venture | — | — | — | 69,603 | — | 69,603 | |||||||||||||||||
Deferred income tax asset | — | — | — | 8,138 | — | 8,138 | |||||||||||||||||
Other long-term assets, net | — | 267,532 | 26,329 | 31,524 | — | 325,385 | |||||||||||||||||
Total assets | $ | 3,167,817 | $ | 2,387,937 | $ | 2,553,919 | $ | 5,230,584 | $ | (7,953,864 | ) | $ | 5,386,393 | ||||||||||
Liabilities and Partners’ Equity | |||||||||||||||||||||||
Current portion of long-term debt | $ | — | $ | 832 | $ | — | $ | — | $ | — | $ | 832 | |||||||||||
Payables | — | 28,705 | 9,559 | 257,651 | (3,188 | ) | 292,727 | ||||||||||||||||
Accrued interest payable | — | 21,180 | 8,490 | 36 | — | 29,706 | |||||||||||||||||
Accrued liabilities | 680 | 18,154 | 3,973 | 35,146 | — | 57,953 | |||||||||||||||||
Taxes other than income tax | 125 | 4,273 | 2,587 | 3,733 | — | 10,718 | |||||||||||||||||
Income tax payable | — | 1,140 | — | 153 | — | 1,293 | |||||||||||||||||
Intercompany payable | 510,812 | — | — | 1,005,211 | (1,516,023 | ) | — | ||||||||||||||||
Total current liabilities | 511,617 | 74,284 | 24,609 | 1,301,930 | (1,519,211 | ) | 393,229 | ||||||||||||||||
Long-term debt, less current portion | — | 1,589,189 | 514,270 | 32,789 | — | 2,136,248 | |||||||||||||||||
Long-term payable to related party | — | 3,571 | — | 6,517 | — | 10,088 | |||||||||||||||||
Deferred income tax liability | — | — | — | 29,565 | — | 29,565 | |||||||||||||||||
Other long-term liabilities | — | 33,458 | 228 | 80,877 | — | 114,563 | |||||||||||||||||
Total partners’ equity | 2,656,200 | 687,435 | 2,014,812 | 3,778,906 | (6,434,653 | ) | 2,702,700 | ||||||||||||||||
Total liabilities and partners’ equity | $ | 3,167,817 | $ | 2,387,937 | $ | 2,553,919 | $ | 5,230,584 | $ | (7,953,864 | ) | $ | 5,386,393 |
(a) | Non-guarantor subsidiaries are wholly owned by NuStar Energy, NuStar Logistics or NuPOP. |
NuStar Energy | NuStar Logistics | NuPOP | Non-Guarantor Subsidiaries (a) | Eliminations | Consolidated | ||||||||||||||||||
Revenues | $ | — | $ | 78,554 | $ | 46,076 | $ | 1,708,288 | $ | (8,568 | ) | $ | 1,824,350 | ||||||||||
Costs and expenses | 482 | 38,068 | 32,090 | 1,669,422 | (8,689 | ) | 1,731,373 | ||||||||||||||||
Operating (loss) income | (482 | ) | 40,486 | 13,986 | 38,866 | 121 | 92,977 | ||||||||||||||||
Equity in earnings of subsidiaries | 70,641 | 7,285 | 29,828 | 51,102 | (158,856 | ) | — | ||||||||||||||||
Equity in earnings of joint venture | — | — | — | 2,599 | — | 2,599 | |||||||||||||||||
Interest expense, net | — | (15,210 | ) | (5,685 | ) | (670 | ) | — | (21,565 | ) | |||||||||||||
Other income, net | — | 109 | 246 | 412 | — | 767 | |||||||||||||||||
Income (loss) before income tax expense | 70,159 | 32,670 | 38,375 | 92,309 | (158,735 | ) | 74,778 | ||||||||||||||||
Income tax expense | 1 | 542 | — | 3,954 | — | 4,497 | |||||||||||||||||
Net income (loss) | 70,158 | 32,128 | 38,375 | 88,355 | (158,735 | ) | 70,281 | ||||||||||||||||
Less net income attributable to noncontrolling interest | — | — | — | 123 | — | 123 | |||||||||||||||||
Net income (loss) attributable to NuStar Energy L.P. | $ | 70,158 | $ | 32,128 | $ | 38,375 | $ | 88,232 | $ | (158,735 | ) | $ | 70,158 |
(a) | Non-guarantor subsidiaries are wholly owned by NuStar Energy, NuStar Logistics or NuPOP. |
NuStar Energy | NuStar Logistics | NuPOP | Non-Guarantor Subsidiaries (a) | Eliminations | Consolidated | ||||||||||||||||||
Revenues | $ | — | $ | 72,051 | $ | 44,675 | $ | 1,025,036 | $ | (3,383 | ) | $ | 1,138,379 | ||||||||||
Costs and expenses | 367 | 46,664 | 31,267 | 973,091 | (3,300 | ) | 1,048,089 | ||||||||||||||||
Operating (loss) income | (367 | ) | 25,387 | 13,408 | 51,945 | (83 | ) | 90,290 | |||||||||||||||
Equity in earnings of subsidiaries | 68,677 | 24,837 | 25,808 | 39,563 | (158,885 | ) | — | ||||||||||||||||
Equity in earnings of joint venture | — | — | — | 2,454 | — | 2,454 | |||||||||||||||||
Interest expense, net | — | (14,330 | ) | (5,827 | ) | (426 | ) | — | (20,583 | ) | |||||||||||||
Other income, net | — | 69 | (16 | ) | (288 | ) | — | (235 | ) | ||||||||||||||
Income (loss) before income tax expense | 68,310 | 35,963 | 33,373 | 93,248 | (158,968 | ) | 71,926 | ||||||||||||||||
Income tax expense | — | 465 | — | 3,151 | — | 3,616 | |||||||||||||||||
Net income (loss) | $ | 68,310 | $ | 35,498 | $ | 33,373 | $ | 90,097 | $ | (158,968 | ) | $ | 68,310 |
(a) | Non-guarantor subsidiaries are wholly owned by NuStar Energy, NuStar Logistics or NuPOP. |
NuStar Energy | NuStar Logistics | NuPOP | Non-Guarantor Subsidiaries (a) | Eliminations | Consolidated | ||||||||||||||||||
Revenues | $ | — | $ | 212,483 | $ | 136,525 | $ | 4,325,226 | $ | (26,084 | ) | $ | 4,648,150 | ||||||||||
Costs and expenses | 1,283 | 124,399 | 98,669 | 4,184,028 | (26,288 | ) | 4,382,091 | ||||||||||||||||
Operating (loss) income | (1,283 | ) | 88,084 | 37,856 | 141,198 | 204 | 266,059 | ||||||||||||||||
Equity in earnings of subsidiaries | 192,543 | 41,827 | 86,491 | 146,940 | (467,801 | ) | — | ||||||||||||||||
Equity in earnings of joint venture | — | — | — | 6,997 | — | 6,997 | |||||||||||||||||
Interest expense, net | — | (43,234 | ) | (17,236 | ) | (2,174 | ) | — | (62,644 | ) | |||||||||||||
Other income, net | — | 292 | 265 | (6,256 | ) | — | (5,699 | ) | |||||||||||||||
Income (loss) before income tax expense | 191,260 | 86,969 | 107,376 | 286,705 | (467,597 | ) | 204,713 | ||||||||||||||||
Income tax expense | 1 | 1,569 | — | 11,741 | — | 13,311 | |||||||||||||||||
Net income (loss) | 191,259 | 85,400 | 107,376 | 274,964 | (467,597 | ) | 191,402 | ||||||||||||||||
Less net income attributable to noncontrolling interest | — | — | — | 143 | — | 143 | |||||||||||||||||
Net income (loss) attributable to NuStar Energy L.P. | $ | 191,259 | $ | 85,400 | $ | 107,376 | $ | 274,821 | $ | (467,597 | ) | $ | 191,259 |
(a) | Non-guarantor subsidiaries are wholly owned by NuStar Energy, NuStar Logistics or NuPOP. |
NuStar Energy | NuStar Logistics | NuPOP | Non-Guarantor Subsidiaries (a) | Eliminations | Consolidated | ||||||||||||||||||
Revenues | $ | — | $ | 219,277 | $ | 117,535 | $ | 2,888,095 | $ | (16,058 | ) | $ | 3,208,849 | ||||||||||
Costs and expenses | 1,042 | 139,698 | 87,245 | 2,766,926 | (18,155 | ) | 2,976,756 | ||||||||||||||||
Operating (loss) income | (1,042 | ) | 79,579 | 30,290 | 121,169 | 2,097 | 232,093 | ||||||||||||||||
Equity in earnings of subsidiaries | 188,476 | 39,295 | 93,698 | 134,457 | (455,926 | ) | — | ||||||||||||||||
Equity in earnings of joint venture | — | — | — | 7,571 | — | 7,571 | |||||||||||||||||
Interest expense, net | 1 | (38,744 | ) | (17,671 | ) | (1,645 | ) | — | (58,059 | ) | |||||||||||||
Other income, net | — | 1,308 | 243 | 13,331 | — | 14,882 | |||||||||||||||||
Income (loss) before income tax expense | 187,435 | 81,438 | 106,560 | 274,883 | (453,829 | ) | 196,487 | ||||||||||||||||
Income tax expense | — | 1,191 | — | 7,861 | — | 9,052 | |||||||||||||||||
Net income (loss) | $ | 187,435 | $ | 80,247 | $ | 106,560 | $ | 267,022 | $ | (453,829 | ) | $ | 187,435 |
(a) | Non-guarantor subsidiaries are wholly owned by NuStar Energy, NuStar Logistics or NuPOP. |
NuStar Energy | NuStar Logistics | NuPOP | Non-Guarantor Subsidiaries (a) | Eliminations | Consolidated | ||||||||||||||||||
Net cash provided by (used in) operating activities | $ | 239,146 | $ | 84,681 | $ | 20,883 | $ | (2,244 | ) | $ | (240,595 | ) | $ | 101,871 | |||||||||
Cash flows from investing activities: | |||||||||||||||||||||||
Capital expenditures | — | (152,764 | ) | (4,954 | ) | (86,240 | ) | — | (243,958 | ) | |||||||||||||
Acquisitions | — | — | — | (100,693 | ) | — | (100,693 | ) | |||||||||||||||
Investment in other long-term assets | — | — | — | (8,449 | ) | — | (8,449 | ) | |||||||||||||||
Proceeds from sale or disposition of assets | — | 57 | 79 | 309 | — | 445 | |||||||||||||||||
Investment in subsidiaries | (57,300 | ) | (47,820 | ) | (56,727 | ) | (56,727 | ) | 218,574 | — | |||||||||||||
Net cash used in investing activities | (57,300 | ) | (200,527 | ) | (61,602 | ) | (251,800 | ) | 218,574 | (352,655 | ) | ||||||||||||
Cash flows from financing activities: | |||||||||||||||||||||||
Debt borrowings | — | 738,702 | — | — | — | 738,702 | |||||||||||||||||
Debt repayments | — | (379,753 | ) | — | — | — | (379,753 | ) | |||||||||||||||
Issuance of common units, net of issuance costs | 1,583 | — | — | — | — | 1,583 | |||||||||||||||||
General partner contribution | 70 | — | — | — | — | 70 | |||||||||||||||||
Distributions to unitholders and general partner | (240,571 | ) | (240,571 | ) | — | (24 | ) | 240,595 | (240,571 | ) | |||||||||||||
Contributions from (distributions to) affiliates | 57,300 | (57,300 | ) | 56,727 | 161,847 | (218,574 | ) | — | |||||||||||||||
Proceeds from termination of interest rate swaps | — | 12,632 | — | — | — | 12,632 | |||||||||||||||||
Net intercompany borrowings (repayments) | (159 | ) | (66,833 | ) | (16,008 | ) | 83,000 | — | — | ||||||||||||||
Other, net | — | 181 | — | (966 | ) | — | (785 | ) | |||||||||||||||
Net cash provided by (used in) financing activities | (181,777 | ) | 7,058 | 40,719 | 243,857 | 22,021 | 131,878 | ||||||||||||||||
Effect of foreign exchange rate changes on cash | — | 1,139 | — | (4,140 | ) | — | (3,001 | ) | |||||||||||||||
Net (decrease) increase in cash and cash equivalents | 69 | (107,649 | ) | — | (14,327 | ) | — | (121,907 | ) | ||||||||||||||
Cash and cash equivalents as of the beginning of the period | 53 | 107,655 | — | 73,413 | — | 181,121 | |||||||||||||||||
Cash and cash equivalents as of the end of the period | $ | 122 | $ | 6 | $ | — | $ | 59,086 | $ | — | $ | 59,214 |
(a) | Non-guarantor subsidiaries are wholly owned by NuStar Energy, NuStar Logistics or NuPOP. |
NuStar Energy | NuStar Logistics | NuPOP | Non-Guarantor Subsidiaries (a) | Eliminations | Consolidated | ||||||||||||||||||
Net cash provided by (used in) operating activities | $ | 223,178 | $ | 122,613 | $ | 14,937 | $ | 45,666 | $ | (225,561 | ) | $ | 180,833 | ||||||||||
Cash flows from investing activities: | |||||||||||||||||||||||
Capital expenditures | — | (75,175 | ) | (10,017 | ) | (106,266 | ) | — | (191,458 | ) | |||||||||||||
Acquisition | — | — | — | (43,026 | ) | — | (43,026 | ) | |||||||||||||||
Proceeds from insurance recoveries | — | — | — | 13,500 | — | 13,500 | |||||||||||||||||
Investment in other long-term assets | — | — | — | (3,400 | ) | — | (3,400 | ) | |||||||||||||||
Proceeds from sale or disposition of assets | — | 16 | 28 | 1,948 | — | 1,992 | |||||||||||||||||
Investment in subsidiaries | (245,604 | ) | — | — | (25 | ) | 245,629 | — | |||||||||||||||
Net cash used in investing activities | (245,604 | ) | (75,159 | ) | (9,989 | ) | (137,269 | ) | 245,629 | (222,392 | ) | ||||||||||||
Cash flows from financing activities: | |||||||||||||||||||||||
Debt borrowings | — | 952,475 | — | — | — | 952,475 | |||||||||||||||||
Debt repayments | — | (1,343,224 | ) | — | — | — | (1,343,224 | ) | |||||||||||||||
Senior note offering, net | — | 445,574 | — | — | — | 445,574 | |||||||||||||||||
Issuance of common units, net of issuance costs | 240,158 | — | — | — | — | 240,158 | |||||||||||||||||
General partner contribution | 5,078 | — | — | — | — | 5,078 | |||||||||||||||||
Contributions from (distributions to) affiliates | — | 245,604 | — | 25 | (245,629 | ) | — | ||||||||||||||||
Distributions to unitholders and general partner | (225,538 | ) | (225,538 | ) | — | (23 | ) | 225,561 | (225,538 | ) | |||||||||||||
Net intercompany borrowings (repayments) | 2,728 | (90,801 | ) | (4,947 | ) | 93,020 | — | — | |||||||||||||||
Other, net | — | (6,987 | ) | (1 | ) | (1,758 | ) | — | (8,746 | ) | |||||||||||||
Net cash provided by (used in) financing activities | 22,426 | (22,897 | ) | (4,948 | ) | 91,264 | (20,068 | ) | 65,777 | ||||||||||||||
Effect of foreign exchange rate changes on cash | — | (5,290 | ) | — | 4,932 | — | (358 | ) | |||||||||||||||
Net decrease in cash and cash equivalents | — | 19,267 | — | 4,593 | — | 23,860 | |||||||||||||||||
Cash and cash equivalents as of the beginning of the period | 53 | 1,602 | — | 60,351 | — | 62,006 | |||||||||||||||||
Cash and cash equivalents as of the end of the period | $ | 53 | $ | 20,869 | $ | — | $ | 64,944 | $ | — | $ | 85,866 |
(a) | Non-guarantor subsidiaries are wholly owned by NuStar Energy, NuStar Logistics or NuPOP. |
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations |
• | Overview |
• | Results of Operations |
• | Outlook |
• | Liquidity and Capital Resources |
• | Related Party Transactions |
• | Critical Accounting Policies |
• | company-specific factors, such as facility integrity issues and maintenance requirements that impact the throughput rates of our assets; |
• | seasonal factors that affect the demand for products transported by and/or stored in our assets and the demand for products we sell, particularly asphalt; |
• | industry factors, such as changes in the prices of petroleum products, that affect demand and operations of our competitors; |
• | factors such as commodity price volatility and market structure; and |
• | other factors, such as refinery utilization rates and maintenance turnaround schedules, that impact our refineries, as well as the operations of refineries served by our storage and transportation assets. |
Three Months Ended September 30, | Change | ||||||||||
2011 | 2010 | ||||||||||
Statement of Income Data: | |||||||||||
Revenues: | |||||||||||
Services revenues | $ | 210,681 | $ | 201,390 | $ | 9,291 | |||||
Product sales | 1,613,669 | 936,989 | 676,680 | ||||||||
Total revenues | 1,824,350 | 1,138,379 | 685,971 | ||||||||
Costs and expenses: | |||||||||||
Cost of product sales | 1,535,609 | 860,942 | 674,667 | ||||||||
Operating expenses | 135,615 | 121,748 | 13,867 | ||||||||
General and administrative expenses | 17,731 | 26,860 | (9,129 | ) | |||||||
Depreciation and amortization expense | 42,418 | 38,539 | 3,879 | ||||||||
Total costs and expenses | 1,731,373 | 1,048,089 | 683,284 | ||||||||
Operating income | 92,977 | 90,290 | 2,687 | ||||||||
Equity in earnings of joint venture | 2,599 | 2,454 | 145 | ||||||||
Interest expense, net | (21,565 | ) | (20,583 | ) | (982 | ) | |||||
Other income (expense), net | 767 | (235 | ) | 1,002 | |||||||
Income before income tax expense | 74,778 | 71,926 | 2,852 | ||||||||
Income tax expense | 4,497 | 3,616 | 881 | ||||||||
Net income | $ | 70,281 | $ | 68,310 | $ | 1,971 | |||||
Net income per unit applicable to limited partners | $ | 0.92 | $ | 0.90 | $ | 0.02 | |||||
Weighted-average limited partner units outstanding | 64,612,423 | 64,610,549 | 1,874 |
Three Months Ended September 30, | Change | ||||||||||
2011 | 2010 | ||||||||||
Storage: | |||||||||||
Throughput (barrels/day) | 721,618 | 673,121 | 48,497 | ||||||||
Throughput revenues | $ | 21,743 | $ | 19,139 | $ | 2,604 | |||||
Storage lease revenues | 120,146 | 111,998 | 8,148 | ||||||||
Total revenues | 141,889 | 131,137 | 10,752 | ||||||||
Operating expenses | 71,386 | 66,153 | 5,233 | ||||||||
Depreciation and amortization expense | 21,725 | 19,349 | 2,376 | ||||||||
Segment operating income | $ | 48,778 | $ | 45,635 | $ | 3,143 | |||||
Transportation: | |||||||||||
Refined products pipelines throughput (barrels/day) | 523,279 | 526,825 | (3,546 | ) | |||||||
Crude oil pipelines throughput (barrels/day) | 319,103 | 382,845 | (63,742 | ) | |||||||
Total throughput (barrels/day) | 842,382 | 909,670 | (67,288 | ) | |||||||
Throughput revenues | $ | 81,899 | $ | 80,597 | $ | 1,302 | |||||
Operating expenses | 30,796 | 30,488 | 308 | ||||||||
Depreciation and amortization expense | 12,855 | 12,597 | 258 | ||||||||
Segment operating income | $ | 38,248 | $ | 37,512 | $ | 736 | |||||
Asphalt and Fuels Marketing: | |||||||||||
Product sales | $ | 1,618,693 | $ | 937,074 | $ | 681,619 | |||||
Cost of product sales | 1,545,340 | 864,904 | 680,436 | ||||||||
Gross margin | 73,353 | 72,170 | 1,183 | ||||||||
Operating expenses | 41,862 | 31,575 | 10,287 | ||||||||
Depreciation and amortization expense | 6,073 | 5,138 | 935 | ||||||||
Segment operating income | $ | 25,418 | $ | 35,457 | $ | (10,039 | ) | ||||
Consolidation and Intersegment Eliminations: | |||||||||||
Revenues | $ | (18,131 | ) | $ | (10,429 | ) | $ | (7,702 | ) | ||
Cost of product sales | (9,731 | ) | (3,962 | ) | (5,769 | ) | |||||
Operating expenses | (8,429 | ) | (6,468 | ) | (1,961 | ) | |||||
Total | $ | 29 | $ | 1 | $ | 28 | |||||
Consolidated Information: | |||||||||||
Revenues | $ | 1,824,350 | $ | 1,138,379 | $ | 685,971 | |||||
Cost of product sales | 1,535,609 | 860,942 | 674,667 | ||||||||
Operating expenses | 135,615 | 121,748 | 13,867 | ||||||||
Depreciation and amortization expense | 40,653 | 37,084 | 3,569 | ||||||||
Segment operating income | 112,473 | 118,605 | (6,132 | ) | |||||||
General and administrative expenses | 17,731 | 26,860 | (9,129 | ) | |||||||
Other depreciation and amortization expense | 1,765 | 1,455 | 310 | ||||||||
Consolidated operating income | $ | 92,977 | $ | 90,290 | $ | 2,687 |
• | an increase in revenues of $3.1 million and an increase in throughputs of 17,562 barrels per day on refined product pipelines serving the McKee refinery due to operational issues at the refinery during the third quarter of 2010; |
• | an increase in revenues of $0.9 million and an increase in throughputs of 22,464 barrels per day from the reactivation of a previously idled pipeline in South Texas; |
• | an increase in revenues of $0.9 million, despite decreased throughputs of 4,633 barrels per day, on crude oil pipelines serving the McKee refinery mainly because volumes were shifted to a crude oil pipeline with a higher tariff; and |
• | an increase in revenues of $0.7 million on the East Pipeline, despite decreased throughputs of 6,316 barrels per day, due to a tariff increase in July 2011 and increased long-haul deliveries resulting in a higher average tariff. |
• | a decrease in revenues of $1.8 million and a decrease in throughputs of 34,568 barrels per day on our Corpus Christi to Three Rivers crude oil pipeline due to a customer receiving crude oil from alternate sources, thus reducing the volume transported on our pipeline; |
• | a decrease in revenues of $1.6 million and a decrease in throughputs of 47,574 barrels per day on our crude oil pipelines serving the Ardmore refinery mainly due to operational issues at the refinery and a shift in supply volumes; and |
• | a decrease in revenues of $1.3 million on the ammonia pipeline, despite only slightly lower throughputs, due to fewer long-haul movements as flooding in the second quarter continued to cause operational issues in the third quarter of 2011. |
Nine Months Ended September 30, | Change | ||||||||||
2011 | 2010 | ||||||||||
Statement of Income Data: | |||||||||||
Revenues: | |||||||||||
Services revenues | $ | 608,689 | $ | 585,772 | $ | 22,917 | |||||
Product sales | 4,039,461 | 2,623,077 | 1,416,384 | ||||||||
Total revenues | 4,648,150 | 3,208,849 | 1,439,301 | ||||||||
Costs and expenses: | |||||||||||
Cost of product sales | 3,797,424 | 2,422,751 | 1,374,673 | ||||||||
Operating expenses | 390,480 | 363,028 | 27,452 | ||||||||
General and administrative expenses | 69,833 | 76,324 | (6,491 | ) | |||||||
Depreciation and amortization expense | 124,354 | 114,653 | 9,701 | ||||||||
Total costs and expenses | 4,382,091 | 2,976,756 | 1,405,335 | ||||||||
Operating income | 266,059 | 232,093 | 33,966 | ||||||||
Equity in earnings of joint venture | 6,997 | 7,571 | (574 | ) | |||||||
Interest expense, net | (62,644 | ) | (58,059 | ) | (4,585 | ) | |||||
Other (expense) income, net | (5,699 | ) | 14,882 | (20,581 | ) | ||||||
Income before income tax expense | 204,713 | 196,487 | 8,226 | ||||||||
Income tax expense | 13,311 | 9,052 | 4,259 | ||||||||
Net income | $ | 191,402 | $ | 187,435 | $ | 3,967 | |||||
Net income per unit applicable to limited partners | $ | 2.49 | $ | 2.55 | $ | (0.06 | ) | ||||
Weighted-average limited partner units outstanding | 64,611,181 | 62,386,373 | 2,224,808 |
Nine Months Ended September 30, | Change | ||||||||||
2011 | 2010 | ||||||||||
Storage: | |||||||||||
Throughput (barrels/day) | 679,031 | 666,635 | 12,396 | ||||||||
Throughput revenues | $ | 58,388 | $ | 56,085 | $ | 2,303 | |||||
Storage lease revenues | 359,820 | 330,493 | 29,327 | ||||||||
Total revenues | 418,208 | 386,578 | 31,630 | ||||||||
Operating expenses | 213,230 | 198,186 | 15,044 | ||||||||
Depreciation and amortization expense | 64,656 | 57,004 | 7,652 | ||||||||
Segment operating income | $ | 140,322 | $ | 131,388 | $ | 8,934 | |||||
Transportation: | |||||||||||
Refined products pipelines throughput (barrels/day) | 509,354 | 529,380 | (20,026 | ) | |||||||
Crude oil pipelines throughput (barrels/day) | 304,554 | 381,606 | (77,052 | ) | |||||||
Total throughput (barrels/day) | 813,908 | 910,986 | (97,078 | ) | |||||||
Throughput revenues | $ | 226,471 | $ | 232,817 | $ | (6,346 | ) | ||||
Operating expenses | 85,381 | 88,784 | (3,403 | ) | |||||||
Depreciation and amortization expense | 38,282 | 38,029 | 253 | ||||||||
Segment operating income | $ | 102,808 | $ | 106,004 | $ | (3,196 | ) | ||||
Asphalt and Fuels Marketing: | |||||||||||
Product sales | $ | 4,049,079 | $ | 2,625,994 | $ | 1,423,085 | |||||
Cost of product sales | 3,821,379 | 2,438,703 | 1,382,676 | ||||||||
Gross margin | 227,700 | 187,291 | 40,409 | ||||||||
Operating expenses | 113,506 | 96,924 | 16,582 | ||||||||
Depreciation and amortization expense | 16,505 | 15,254 | 1,251 | ||||||||
Segment operating income | $ | 97,689 | $ | 75,113 | $ | 22,576 | |||||
Consolidation and Intersegment Eliminations: | |||||||||||
Revenues | $ | (45,608 | ) | $ | (36,540 | ) | $ | (9,068 | ) | ||
Cost of product sales | (23,955 | ) | (15,952 | ) | (8,003 | ) | |||||
Operating expenses | (21,637 | ) | (20,866 | ) | (771 | ) | |||||
Total | $ | (16 | ) | $ | 278 | $ | (294 | ) | |||
Consolidated Information: | |||||||||||
Revenues | $ | 4,648,150 | $ | 3,208,849 | $ | 1,439,301 | |||||
Cost of product sales | 3,797,424 | 2,422,751 | 1,374,673 | ||||||||
Operating expenses | 390,480 | 363,028 | 27,452 | ||||||||
Depreciation and amortization expense | 119,443 | 110,287 | 9,156 | ||||||||
Segment operating income | 340,803 | 312,783 | 28,020 | ||||||||
General and administrative expenses | 69,833 | 76,324 | (6,491 | ) | |||||||
Other depreciation and amortization expense | 4,911 | 4,366 | 545 | ||||||||
Consolidated operating income | $ | 266,059 | $ | 232,093 | $ | 33,966 |
• | an increase of $11.5 million due to completed tank expansion projects at our St. Eustatius and St. James terminals; |
• | an increase of $5.9 million related to our acquisition of three terminals in Mobile County, Alabama in May 2010 and the Turkey Acquisition; |
• | an increase of $5.7 million at our St. Eustatius facility mainly due to higher throughput and related handling fees, as well as new customer contracts, rate escalations and higher reimbursable revenues; and |
• | an increase of $5.2 million at our UK and Amsterdam terminals, primarily due to the effect of foreign exchange rates, new customer contracts and increased customer utilization. |
• | a decrease of 61,087 barrels per day and a decrease of $5.9 million on our pipelines serving the Ardmore refinery, mainly due to a turnaround in March and April 2011, followed by operational issues and a shift in supply volumes; |
• | a decrease of 25,562 barrels per day and a decrease of $5.6 million on the Houston pipeline mainly due to market conditions that favored exporting instead of shipping on our pipeline; |
• | a decrease of 17,721 barrels per day and a decrease of $3.7 million on our Corpus Christi to Three Rivers crude oil pipeline due to a customer receiving crude oil from alternate sources, thus reducing the volume transported on our pipeline; and |
• | a decrease of 8,710 barrels per day and a decrease of $1.9 million on our refined product pipelines serving the Three Rivers refinery mainly due to operational issues and the start of a turnaround at the refinery in 2011. |
• | an increase of 16,909 barrels per day and an increase in revenues of $7.3 million on pipelines serving the McKee refinery mainly due to increased production in 2011 and operational issues and turnaround activity at the refinery in 2010; and |
• | an increase of 5,806 barrels per day and an increase in revenues of $4.1 million on the North Pipeline mainly due to turnaround activity during the second quarter of 2010 at the refinery served by the pipeline. |
Nine Months Ended September 30, | |||||||
2011 | 2010 | ||||||
(Thousands of Dollars) | |||||||
Net cash provided by (used in): | |||||||
Operating activities | $ | 101,871 | $ | 180,833 | |||
Investing activities | (352,655 | ) | (222,392 | ) | |||
Financing activities | 131,878 | 65,777 | |||||
Effect of foreign exchange rate changes on cash | (3,001 | ) | (358 | ) | |||
Net decrease in cash and cash equivalents | $ | (121,907 | ) | $ | 23,860 |
• | reliability capital expenditures, such as those required to maintain equipment reliability and safety and to address environmental and safety regulations; and |
• | strategic capital expenditures, such as those to expand and upgrade pipeline capacity or refinery operations and to construct new pipelines, terminals and storage tanks. In addition, strategic capital expenditures may include acquisitions of pipelines, terminals or storage tank assets, as well as certain capital expenditures related to support functions. |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2011 | 2010 | 2011 | 2010 | ||||||||||||
(Thousands of Dollars, Except Per Unit Data) | |||||||||||||||
General partner interest | $ | 1,628 | $ | 1,592 | $ | 4,847 | $ | 4,635 | |||||||
General partner incentive distribution | 8,972 | 8,568 | 26,503 | 24,736 | |||||||||||
Total general partner distribution | 10,600 | 10,160 | 31,350 | 29,371 | |||||||||||
Limited partners’ distribution | 70,814 | 69,456 | 211,019 | 202,391 | |||||||||||
Total cash distributions | $ | 81,414 | $ | 79,616 | $ | 242,369 | $ | 231,762 | |||||||
Cash distributions per unit applicable to limited partners | $ | 1.095 | $ | 1.075 | $ | 3.265 | $ | 3.205 |
• | the 2007 Revolving Credit Agreement due December 10, 2012, with a balance of $456.3 million as of September 30, 2011; |
• | NuStar Logistics’ 6.875% senior notes due July 15, 2012 with a face value of $100.0 million; 6.05% senior notes due March 15, 2013 with a face value of $229.9 million; 7.65% senior notes due April 15, 2018 with a face value of $350.0 million; and 4.80% senior notes due September 1, 2020 with a face value of $450.0 million; |
• | NuPOP’s 7.75% senior notes due February 15, 2012; and 5.875% senior notes due June 1, 2013 with an aggregate face value of $500.0 million; |
• | $55.4 million revenue bonds due June 1, 2038; $100.0 million revenue bonds due July 1, 2040; $50.0 million revenue bonds due October 1, 2040; $85.0 million revenue bonds due December 1, 2040; and $75.0 million revenue bonds due August 1, 2041 associated with the St. James terminal expansion (Gulf Opportunity Zone Revenue Bonds); |
• | the £21 million term loan due December 11, 2012 (UK Term Loan); and |
• | the $12.0 million note payable in annual installments through December 31, 2015 to the Port of Corpus Christi Authority of Nueces County, Texas, with a balance of $1.8 million as of September 30, 2011, associated with the construction of a crude oil storage facility in Corpus Christi, Texas. |
Notional Amount | Fair Value | ||||||||||||||
September 30, 2011 | December 31, 2010 | September 30, 2011 | December 31, 2010 | ||||||||||||
(Thousands of Dollars) | |||||||||||||||
Type of interest rate swap agreements: | |||||||||||||||
Fixed-to-floating | $ | 450,000 | $ | 617,500 | $ | 23,125 | $ | (18,820 | ) | ||||||
Forward-starting | $ | 500,000 | $ | 500,000 | $ | (40,930 | ) | $ | 35,000 |
Item 3. | Quantitative and Qualitative Disclosures About Market Risk |
September 30, 2011 | |||||||||||||||||||||||||||||||
Expected Maturity Dates | |||||||||||||||||||||||||||||||
2011 | 2012 | 2013 | 2014 | 2015 | There- after | Total | Fair Value | ||||||||||||||||||||||||
(Thousands of Dollars, Except Interest Rates) | |||||||||||||||||||||||||||||||
Long-term Debt: | |||||||||||||||||||||||||||||||
Fixed rate | $ | 832 | $ | 383,713 | $ | 479,994 | $ | — | $ | — | $ | 800,000 | $ | 1,664,539 | $ | 1,787,353 | |||||||||||||||
Weighted average interest rate | 8.0 | % | 7.4 | % | 6.0 | % | — | — | 6.0 | % | 6.3 | % | |||||||||||||||||||
Variable rate | $ | — | $ | 456,259 | $ | — | $ | — | $ | — | $ | 365,440 | $ | 821,699 | $ | 808,180 | |||||||||||||||
Weighted average interest rate | — | 0.9 | % | — | — | — | 0.2 | % | 0.6 | % | |||||||||||||||||||||
Interest Rate Swaps Fixed–to-Floating: | |||||||||||||||||||||||||||||||
Notional amount | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 450,000 | $ | 450,000 | $ | 23,125 | |||||||||||||||
Weighted average pay rate | 2.5 | % | 2.6 | % | 2.8 | % | 3.4 | % | 4.0 | % | 4.9 | % | 4.0 | % | |||||||||||||||||
Weighted average receive rate | 4.8 | % | 4.8 | % | 4.8 | % | 4.8 | % | 4.8 | % | 4.8 | % | 4.8 | % |
December 31, 2010 | |||||||||||||||||||||||||||||||
Expected Maturity Dates | |||||||||||||||||||||||||||||||
2011 | 2012 | 2013 | 2014 | 2015 | There- after | Total | Fair Value | ||||||||||||||||||||||||
(Thousands of Dollars, Except Interest Rates) | |||||||||||||||||||||||||||||||
Long-term Debt: | |||||||||||||||||||||||||||||||
Fixed rate | $ | 832 | $ | 383,687 | $ | 479,986 | $ | — | $ | — | $ | 800,000 | $ | 1,664,505 | $ | 1,775,842 | |||||||||||||||
Weighted average interest rate | 8.0 | % | 7.4 | % | 6.0 | % | — | — | 6.0 | % | 6.3 | % | |||||||||||||||||||
Variable rate | $ | — | $ | 188,282 | $ | — | $ | — | $ | — | $ | 290,440 | $ | 478,722 | $ | 473,348 | |||||||||||||||
Weighted average interest rate | — | 1.0 | % | — | — | — | 0.3 | % | 0.6 | % | |||||||||||||||||||||
Interest Rate Swaps Fixed–to-Floating: | |||||||||||||||||||||||||||||||
Notional amount | $ | — | $ | 60,000 | $ | 107,500 | $ | — | $ | — | $ | 450,000 | $ | 617,500 | $ | (18,820 | ) | ||||||||||||||
Weighted average pay rate | 2.5 | % | 3.3 | % | 4.3 | % | 5.3 | % | 6.1 | % | 6.8 | % | 5.4 | % | |||||||||||||||||
Weighted average receive rate | 5.2 | % | 5.2 | % | 5.0 | % | 4.8 | % | 4.8 | % | 4.8 | % | 4.9 | % |
Notional Amount | Period of Hedge | Weighted- Average Fixed Rate | Fair Value | ||||||||||||
September 30, 2011 | December 31, 2010 | ||||||||||||||
(Thousands of Dollars) | (Thousands of Dollars) | ||||||||||||||
$ | 125,000 | 03/13 - 03/23 | 3.5 | % | $ | (10,588 | ) | $ | 8,717 | ||||||
150,000 | 06/13 - 06/23 | 3.5 | % | (11,718 | ) | 11,243 | |||||||||
225,000 | 02/12 - 02/22 | 3.1 | % | (18,624 | ) | 15,040 | |||||||||
$ | 500,000 | 3.3 | % | $ | (40,930 | ) | $ | 35,000 |
September 30, 2011 | ||||||||||||||
Contract Volumes | Weighted Average | Fair Value of Current Asset (Liability) | ||||||||||||
Pay Price | Receive Price | |||||||||||||
(Thousands of Barrels) | (Thousands of Dollars) | |||||||||||||
Fair Value Hedges: | ||||||||||||||
Futures – long: | ||||||||||||||
(refined products) | 15 | $ | 117.19 | N/A | $ | 7 | ||||||||
Futures – short: | ||||||||||||||
(refined products) | 50 | N/A | $ | 118.78 | $ | 103 | ||||||||
Swaps – long: | ||||||||||||||
(refined products) | 196 | $ | 95.13 | N/A | $ | 581 | ||||||||
Swaps – short: | ||||||||||||||
(refined products) | 1,067 | N/A | $ | 96.17 | $ | 3,986 | ||||||||
Cash Flow Hedges: | ||||||||||||||
Swaps – long: | ||||||||||||||
(crude oil) | 9,988 | 106.80 | N/A | $ | (238,832 | ) | ||||||||
Swaps – short: | ||||||||||||||
(refined products) | 9,988 | N/A | 127.55 | $ | 186,724 | |||||||||
Economic Hedges and Other Derivatives: | ||||||||||||||
Futures – long: | ||||||||||||||
(crude oil and refined products) | 337 | $ | 79.74 | N/A | $ | (2,157 | ) | |||||||
Futures – short: | ||||||||||||||
(crude oil and refined products) | 422 | N/A | $ | 85.91 | $ | 2,428 | ||||||||
Swaps – long: | ||||||||||||||
(refined products) | 434 | $ | 90.98 | N/A | $ | (2,432 | ) | |||||||
Swaps – short: | ||||||||||||||
(refined products) | 673 | N/A | $ | 86.65 | $ | 3,319 | ||||||||
Forward purchase contracts: | ||||||||||||||
(crude oil) | 4,016 | $ | 100.72 | N/A | $ | (23,479 | ) | |||||||
Forward sales contracts: | ||||||||||||||
(crude oil) | 4,016 | N/A | $ | 102.23 | $ | 29,544 | ||||||||
Total fair value of open positions exposed to commodity price risk | $ | (40,208 | ) |
December 31, 2010 | ||||||||||||||
Contract Volumes | Weighted Average | Fair Value of Current Asset (Liability) | ||||||||||||
Pay Price | Receive Price | |||||||||||||
(Thousands of Barrels) | (Thousands of Dollars) | |||||||||||||
Fair Value Hedges: | ||||||||||||||
Futures – short: | ||||||||||||||
(crude oil and refined products) | 436 | N/A | $ | 96.00 | $ | (1,015 | ) | |||||||
Swaps – long: | ||||||||||||||
(refined products) | 380 | $ | 76.05 | N/A | $ | (557 | ) | |||||||
Swaps – short: | ||||||||||||||
(refined products) | 823 | N/A | $ | 74.53 | $ | (2,541 | ) | |||||||
Economic Hedges and Other Derivatives: | ||||||||||||||
Futures – long: | ||||||||||||||
(crude oil and refined products) | 278 | $ | 93.80 | N/A | $ | 802 | ||||||||
Futures – short: | ||||||||||||||
(crude oil and refined products) | 936 | N/A | $ | 100.74 | $ | (2,102 | ) | |||||||
Swaps – long: | ||||||||||||||
(refined products) | 385 | $ | 76.27 | N/A | $ | 1,684 | ||||||||
Swaps – short: | ||||||||||||||
(refined products) | 157 | N/A | $ | 73.22 | $ | (698 | ) | |||||||
Forward purchase contracts: | ||||||||||||||
(crude oil) | 4,680 | $ | 85.81 | N/A | $ | 38,434 | ||||||||
Forward sales contracts: | ||||||||||||||
(crude oil) | 4,680 | N/A | $ | 86.48 | $ | (38,989 | ) | |||||||
Total fair value of open positions exposed to commodity price risk | $ | (4,982 | ) |
Item 4. | Controls and Procedures |
(a) | Evaluation of disclosure controls and procedures. |
(b) | Changes in internal control over financial reporting. |
Item 6. | Exhibits |
Exhibit Number | Description | |
*12.1 | Statement of Computation of Ratio of Earnings to Fixed Charges | |
*31.01 | Rule 13a-14(a) Certification (under Section 302 of the Sarbanes-Oxley Act of 2002) of principal executive officer | |
*31.02 | Rule 13a-14(a) Certification (under Section 302 of the Sarbanes-Oxley Act of 2002) of principal financial officer | |
*32.01 | Section 1350 Certification (under Section 906 of the Sarbanes-Oxley Act of 2002) of principal executive officer | |
*32.02 | Section 1350 Certification (under Section 906 of the Sarbanes-Oxley Act of 2002) of principal financial officer | |
**101 | The following interactive data files pursuant to Rule 405 of Regulation S-T from NuStar Energy L.P.’s Form 10-Q for the quarter ended September 30, 2011, formatted in XBRL (Extensible Business Reporting Language): (i) Consolidated Balance Sheets, (ii) Consolidated Statements of Income, (iii) Consolidated Statements of Cash Flows, and (iv) Condensed Notes to Consolidated Financial Statements. | |
* | Filed herewith. | |
** | Filed electronically herewith. | |
In accordance with Rule 406T of regulation S-T, the XBRL information in Exhibit 101 to this quarterly report on Form 10-Q shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (Exchange Act), or otherwise subject to the liability of that section, and shall not be incorporated by reference into any registration statement or other document filed under the Securities Act of 1933, as amended, or the Exchange Act. The financial information contained in the XBRL-related documents is “unaudited” or “unreviewed.” |
By: | /s/ Curtis V. Anastasio | |
Curtis V. Anastasio | ||
President and Chief Executive Officer | ||
November 7, 2011 | ||
By: | /s/ Steven A. Blank | |
Steven A. Blank | ||
Senior Vice President, Chief Financial Officer and Treasurer | ||
November 7, 2011 | ||
By: | /s/ Thomas R. Shoaf | |
Thomas R. Shoaf | ||
Vice President and Controller | ||
November 7, 2011 |
Nine Months | Years Ended December 31, | ||||||||||||||||||||||
Ended | |||||||||||||||||||||||
September 30, | |||||||||||||||||||||||
2011 | 2010 | 2009 | 2008 | 2007 | 2006 | ||||||||||||||||||
Earnings: | |||||||||||||||||||||||
Income from continuing operations before provision for income taxes and income from equity investees | $ | 197,716 | $ | 240,211 | $ | 225,791 | $ | 256,994 | $ | 154,913 | $ | 149,885 | |||||||||||
Add: | |||||||||||||||||||||||
Fixed charges | 84,282 | 103,390 | 102,781 | 113,959 | 91,594 | 75,829 | |||||||||||||||||
Amortization of capitalized interest | 579 | 642 | 553 | 440 | 255 | 126 | |||||||||||||||||
Distributions from joint ventures | 9,397 | 9,625 | 9,700 | 2,835 | 544 | 5,268 | |||||||||||||||||
Less: Interest capitalized | (4,103 | ) | (3,701 | ) | (1,650 | ) | (5,108 | ) | (5,995 | ) | (1,758 | ) | |||||||||||
Total earnings | $ | 287,871 | $ | 350,167 | $ | 337,175 | $ | 369,120 | $ | 241,311 | $ | 229,350 | |||||||||||
Fixed charges: | |||||||||||||||||||||||
Interest expense (1) | $ | 61,945 | $ | 77,343 | $ | 78,622 | $ | 92,971 | $ | 77,584 | $ | 68,241 | |||||||||||
Amortization of debt issuance costs | 1,281 | 1,118 | 910 | 815 | 1,030 | 726 | |||||||||||||||||
Interest capitalized | 4,103 | 3,701 | 1,650 | 5,108 | 5,995 | 1,758 | |||||||||||||||||
Rental expense interest factor (2) | 16,953 | 21,228 | 21,599 | 15,065 | 6,985 | 5,104 | |||||||||||||||||
Total fixed charges | $ | 84,282 | $ | 103,390 | $ | 102,781 | $ | 113,959 | $ | 91,594 | $ | 75,829 | |||||||||||
Ratio of earnings to fixed charges | 3.4x | 3.4x | 3.3x | 3.2x | 2.6x | 3.0x |
(1) | The “Interest expense, net” reported in NuStar Energy L.P.'s consolidated statement of income for the nine months ended September 30, 2011 includes investment income of $582,000. |
(2) | The interest portion of rental expense represents one-third of rents, which is deemed representative of the interest portion of rental expense. |
/s/ Curtis V. Anastasio |
Curtis V. Anastasio |
President and Chief Executive Officer |
/s/ Steven A. Blank |
Steven A. Blank |
Senior Vice President, Chief Financial Officer and Treasurer |
1. | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
2. | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Partnership. |
/s/ Curtis V. Anastasio |
Curtis V. Anastasio |
President and Chief Executive Officer |
November 7, 2011 |
1. | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
2. | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Partnership. |
/s/ Steven A. Blank |
Steven A. Blank |
Senior Vice President, Chief Financial Officer and Treasurer |
November 7, 2011 |
STATEMENTS OF CASH FLOWS Table 2 (Details) (USD $) In Thousands | 9 Months Ended | |
---|---|---|
Sep. 30, 2011 | Sep. 30, 2010 | |
Supplemental Cash Flow Information [Line Items] | ||
Cash paid for interest, net of amount capitalized | $ 87,576 | $ 66,243 |
Cash paid for income taxes, net of tax refunds received | $ 11,974 | $ 9,580 |
CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) In Thousands, except Share data | Sep. 30, 2011 | Dec. 31, 2010 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $ 1,742 | $ 1,457 |
Common units outstanding | 64,670,520 | 64,610,549 |
CONSOLIDATED STATEMENTS OF INCOME (USD $) In Thousands, except Share data | 3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2011 | Sep. 30, 2010 | Sep. 30, 2011 | Sep. 30, 2010 | |
Service revenues: | ||||
Third parties | $ 210,395 | $ 201,390 | $ 607,866 | $ 585,772 |
Related party | 286 | 0 | 823 | 0 |
Total service revenues | 210,681 | 201,390 | 608,689 | 585,772 |
Product sales | 1,613,669 | 936,989 | 4,039,461 | 2,623,077 |
Total revenues | 1,824,350 | 1,138,379 | 4,648,150 | 3,208,849 |
Costs and expenses: | ||||
Cost of product sales | 1,535,609 | 860,942 | 3,797,424 | 2,422,751 |
Operating expenses: | ||||
Third parties | 98,464 | 86,104 | 281,419 | 259,465 |
Related party | 37,151 | 35,644 | 109,061 | 103,563 |
Total operating expenses | 135,615 | 121,748 | 390,480 | 363,028 |
General and administrative expenses: | ||||
Third parties | 8,746 | 9,727 | 27,865 | 28,633 |
Related party | 8,985 | 17,133 | 41,968 | 47,691 |
Total general and administrative expenses | 17,731 | 26,860 | 69,833 | 76,324 |
Depreciation and amortization expense | 42,418 | 38,539 | 124,354 | 114,653 |
Total costs and expenses | 1,731,373 | 1,048,089 | 4,382,091 | 2,976,756 |
Operating income | 92,977 | 90,290 | 266,059 | 232,093 |
Equity in earnings of joint venture | 2,599 | 2,454 | 6,997 | 7,571 |
Interest expense, net | (21,565) | (20,583) | (62,644) | (58,059) |
Other income (expense), net | 767 | (235) | (5,699) | 14,882 |
Income before income tax expense | 74,778 | 71,926 | 204,713 | 196,487 |
Income tax expense | 4,497 | 3,616 | 13,311 | 9,052 |
Net income | 70,281 | 68,310 | 191,402 | 187,435 |
Less net income attributable to noncontrolling interest | 123 | 0 | 143 | 0 |
Net income attributable to NuStar Energy L.P. | $ 70,158 | $ 68,310 | $ 191,259 | $ 187,435 |
Net income per unit applicable to limited partners (Note 11) | $ 0.92 | $ 0.90 | $ 2.49 | $ 2.55 |
Weighted-average limited partner units outstanding | 64,612,423 | 64,610,549 | 64,611,181 | 62,386,373 |
RELATED PARTY TRANSACTIONS (Tables) | 9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Related Party Transactions [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Related Party Transactions [Text Block] |
|
Document and Entity Information | 9 Months Ended | |
---|---|---|
Sep. 30, 2011 | Oct. 31, 2011 | |
Entity Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2011 | |
Document Fiscal Year Focus | 2011 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | ns | |
Entity Registrant Name | NuStar Energy L.P. | |
Entity Central Index Key | 0001110805 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 64,718,578 |
NET INCOME PER UNIT Parentheticals (Details) | 9 Months Ended |
---|---|
Sep. 30, 2011 | |
Schedule Of Net Income Per Unit [Line Items] | |
General Partner Ownership Interest of Limited Partnership | 2.00% |
Limited Partners Ownership Interest | 98.00% |
NET INCOME PER UNIT (Tables) | 9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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NET INCOME PER UNIT [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Net Income Per Unit [Text Block] | The following table details the calculation of earnings per unit:
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DERIVATIVES AND RISK MANAGEMENT ACTIVITIES | 9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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DERIVATIVES AND RISK MANAGEMENT ACTIVITIES [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
DERIVATIVES AND RISK MANAGEMENT ACTIVITIES | DERIVATIVES AND RISK MANAGEMENT ACTIVITIES We utilize various derivative instruments to: (i) manage our exposure to commodity price risk; (ii) engage in a trading program; and (iii) manage our exposure to interest rate risk. Our risk management policies and procedures are designed to monitor interest rates, futures and swaps positions, as well as physical volumes, grades, locations and delivery schedules to help ensure that our hedging activities address our market risks. We have a risk management committee that oversees our trading controls and procedures and certain aspects of commodity and trading risk management. Our risk management committee also reviews all new commodity and trading risk management strategies in accordance with our risk management policy, as approved by our board of directors. Interest Rate Risk We are a party to certain interest rate swap agreements to manage our exposure to changes in interest rates. We have fixed-to-floating interest rate swap agreements associated with a portion of our fixed-rate senior notes. We account for our fixed-to-floating interest rate swaps as fair value hedges. During the nine months ended September 30, 2011, we entered into and terminated a fixed-to-floating interest rate swap agreement with a notional amount of $40.0 million related to the 7.65% senior notes issued in April 2008. We also terminated interest rate swap agreements with an aggregate notional amount of $167.5 million associated with our 6.875% and 6.05% senior notes during the nine months ended September 30, 2011. We received $12.6 million in connection with the terminations, which is being amortized into "Interest expense, net" over the remaining lives of the 7.65%, 6.875% and 6.05% senior notes. Proceeds from the termination of interest rate swap agreements are included in cash flows from financing activities on the consolidated statements of cash flows. The total aggregate notional amount of the fixed-to-floating interest rate swaps was $450.0 million as of September 30, 2011 and $617.5 million as of December 31, 2010. The weighted-average interest rate that we paid under our fixed-to-floating interest rate swaps was 2.6% as of September 30, 2011. We are also a party to forward-starting interest rate swap agreements with an aggregate notional amount of $500.0 million as of September 30, 2011 and December 31, 2010 related to forecasted probable debt issuances in 2012 and 2013. We entered into the swaps in order to hedge the risk of changes in the interest payments attributable to changes in the benchmark interest rate during the period from the effective date of the swap to the issuance of the forecasted debt. These swaps are designated and qualify as cash flow hedges. Commodity Price Risk We are exposed to market risks related to the volatility of crude oil and refined product prices. In order to reduce the risk of commodity price fluctuations with respect to our crude oil and finished product inventories and related firm commitments to purchase and/or sell such inventories, we utilize commodity futures and swap contracts, which qualify and we designate as fair value hedges. During the second quarter of 2011, we entered into commodity swap contracts to hedge the price risk associated with the San Antonio Refinery. These contracts fix the purchase price of crude oil and sales prices of refined products for a portion of the expected production of the San Antonio Refinery, thereby attempting to mitigate the risk of volatility of future cash flows associated with hedged volumes. These contracts qualified and we designated them as cash flow hedges. Derivatives that are intended to hedge our commodity price risk, but fail to qualify as fair value or cash flow hedges, are considered economic hedges, and associated gains and losses are recorded in net income. We also enter into commodity derivatives in order to attempt to profit from market fluctuations. These derivative instruments are financial positions entered into without underlying physical inventory and are not considered hedges. Changes in the fair values are recorded in net income. The volume of commodity contracts is based on open derivative positions and represents the combined volume of our long and short positions on an absolute basis, which totaled 31.2 million barrels and 12.8 million barrels as of September 30, 2011 and December 31, 2010, respectively. As of December 31, 2010, we had $17.8 million of margin deposits related to our derivative instruments and none as of September 30, 2011. The fair values of our derivative instruments included in our consolidated balance sheets were as follows:
The earnings impact of our derivative activity was as follows:
For derivatives designated as cash flow hedging instruments, once a hedged transaction occurs, we reclassify the effective portion from accumulated OCI to “Cost of product sales” or “Interest expense, net.” As of September 30, 2011, we expect to reclassify a loss of $25.0 million to “Cost of product sales” and a loss of $1.2 million to “Interest expense, net” within the next twelve months. The maximum length of time over which we are hedging our exposure to the variability in future cash flows is approximately two years for our forward-starting interest rate swaps and approximately four years for our commodity contracts. |
STATEMENTS OF CASH FLOWS (Tables) | 9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2011 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
STATEMENTS OF CASH FLOWS [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Changes in Current Assets and Liabilities [Text Block] |
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Schedule of Supplemental Cash Flow Information [Text Block] |
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PARTNERS' EQUITY (Tables) | 9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2011 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PARTNERS' EQUITY [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Changes in Partners' Equity |
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Schedule of Calculation of Net Income Applicable to General Partner [Text Block] |
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Schedule of Distributions To General and Limited Partners [Text Block] |
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STATEMENTS OF CASH FLOWS | 9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2011 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
STATEMENTS OF CASH FLOWS [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
STATEMENTS OF CASH FLOWS | STATEMENTS OF CASH FLOWS Changes in current assets and current liabilities were as follows:
Cash flows related to interest and income taxes were as follows:
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INVENTORIES | 9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2011 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INVENTORIES [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INVENTORIES | INVENTORIES Inventories consisted of the following:
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OTHER INCOME (EXPENSE) | 9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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OTHER INCOME (EXPENSE) [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
OTHER INCOME (EXPENSE) | OTHER INCOME (EXPENSE) Other income (expense), net consisted of the following:
For the three and nine months ended September 30, 2011, the contingent loss adjustment relates to the Eres matter discussed in Note 5. Commitments and Contingencies. For the nine months ended September 30, 2011, "Other income (expense), net" included $5.0 million in costs associated with the early termination of a third-party storage agreement at our Paulsboro, New Jersey asphalt refinery. For the nine months ended September 30, 2010, the gain from insurance recoveries resulted from insurance claims related to damage in the third quarter of 2008 primarily at our Texas City, Texas terminal caused by Hurricane Ike. |
CONDENSED CONSOLIDATING FINANCIAL STATEMENTS | 9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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CONDENSED CONSOLIDATING FINANCIAL STATEMENTS [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
CONDENSED CONSOLIDATING FINANCIAL STATEMENTS | CONDENSED CONSOLIDATING FINANCIAL STATEMENTS NuStar Energy has no operations and its assets consist mainly of its investments in NuStar Logistics and NuPOP, both wholly owned subsidiaries. The senior notes issued by NuStar Logistics and NuPOP are fully and unconditionally guaranteed by NuStar Energy, and each of NuStar Logistics and NuPOP fully and unconditionally guarantee the outstanding senior notes of the other. As a result, the following condensed consolidating financial statements are presented as an alternative to providing separate financial statements for NuStar Logistics and NuPOP. Condensed Consolidating Balance Sheets September 30, 2011 (Thousands of Dollars)
Condensed Consolidating Balance Sheets December 31, 2010 (Thousands of Dollars)
Condensed Consolidating Statements of Income For the Three Months Ended September 30, 2011 (Thousands of Dollars)
Condensed Consolidating Statements of Income For the Three Months Ended September 30, 2010 (Thousands of Dollars)
Condensed Consolidating Statements of Income For the Nine Months Ended September 30, 2011 (Thousands of Dollars)
Condensed Consolidating Statements of Income For the Nine Months Ended September 30, 2010 (Thousands of Dollars)
Condensed Consolidating Statements of Cash Flows For the Nine Months Ended September 30, 2011 (Thousands of Dollars)
Condensed Consolidating Statements of Cash Flows For the Nine Months Ended September 30, 2010 (Thousands of Dollars)
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PARTNERS' EQUITY | 9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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PARTNERS' EQUITY [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PARTNERS' EQUITY | PARTNERS’ EQUITY Partners' Equity Activity The following table summarizes changes in the carrying amount of partners' equity and noncontrolling interest:
Allocations of Net Income Our partnership agreement, as amended, sets forth the calculation to be used to determine the amount and priority of cash distributions that the common unitholders and the general partner will receive. The partnership agreement also contains provisions for the allocation of net income and loss to the unitholders and the general partner. For purposes of maintaining partner capital accounts, the partnership agreement specifies that items of income and loss shall be allocated among the partners in accordance with their respective percentage interests. Normal allocations according to percentage interests are made after giving effect to priority income allocations, if any, in an amount equal to incentive cash distributions allocated 100% to the general partner. The following table details the calculation of net income applicable to the general partner:
Cash Distributions On August 12, 2011, we paid a quarterly cash distribution totaling $81.3 million, or $1.095 per unit, related to the second quarter of 2011. On October 28, 2011, we announced a quarterly cash distribution of $1.095 per unit related to the third quarter of 2011. This distribution will be paid on November 14, 2011 to unitholders of record on November 8, 2011 and will total $81.4 million. The following table reflects the allocation of total cash distributions to the general and limited partners applicable to the period in which the distributions were earned:
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INVENTORIES Table (Details) (USD $) In Thousands | Sep. 30, 2011 | Dec. 31, 2010 |
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Schedule of Inventory [Line Items] | ||
Crude oil | $ 220,672 | $ 122,945 |
Finished products | 372,841 | 281,197 |
Materials and supplies | 10,170 | 9,395 |
Total | $ 603,683 | $ 413,537 |
RELATED PARTY TRANSACTIONS | 9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Related Party Transactions [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Related Party Transactions Disclosure [Text Block] | RELATED PARTY TRANSACTIONS Our operations are managed by NuStar GP, LLC, the general partner of our general partner. Under a services agreement between NuStar Energy and NuStar GP, LLC, employees of NuStar GP, LLC perform services for our U.S. operations. Certain of our wholly owned subsidiaries employ persons who perform services for our international operations. Employees of NuStar GP, LLC provide services to both NuStar Energy and NuStar GP Holdings; therefore, we reimburse NuStar GP, LLC for all costs related to its employees, other than costs associated with NuStar GP Holdings. Related party revenues result from storage agreements between our Turkey subsidiary and the noncontrolling shareholder.
We had a payable to NuStar GP, LLC of $12.4 million and $10.3 million, as of September 30, 2011 and December 31, 2010, respectively, with both amounts representing payroll, employee benefit plans and unit-based compensation. We also had a long-term payable to NuStar GP, LLC as of September 30, 2011 and December 31, 2010 of $11.9 million and $10.1 million, respectively, related to amounts payable for retiree medical benefits and other post-employment benefits. |
SEGMENT INFORMATION Table 2 (Details) (USD $) In Thousands | Sep. 30, 2011 | Dec. 31, 2010 |
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Segment Information | ||
Total consolidated assets | $ 5,848,148 | $ 5,386,393 |
Total segment assets | 5,463,261 | 4,865,377 |
Storage Segment | ||
Segment Information | ||
Total consolidated assets | 2,556,356 | 2,454,264 |
Transportation Segment | ||
Segment Information | ||
Total consolidated assets | 1,251,463 | 1,256,614 |
Asphalt and Fuels Marketing Segment | ||
Segment Information | ||
Total consolidated assets | 1,655,442 | 1,154,499 |
Other partnership assets | ||
Segment Information | ||
Total consolidated assets | $ 384,887 | $ 521,016 |
ORGANIZATION AND BASIS OF PRESENTATION | 9 Months Ended |
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Sep. 30, 2011 | |
ORGANIZATION AND BASIS OF PRESENTATION [Abstract] | |
ORGANIZATION AND BASIS OF PRESENTATION | ORGANIZATION AND BASIS OF PRESENTATION Organization NuStar Energy L.P. (NuStar Energy) (NYSE: NS) is engaged in the terminalling and storage of petroleum products, the transportation of petroleum products and anhydrous ammonia, and petroleum refining and marketing. Unless otherwise indicated, the terms “NuStar Energy,” “the Partnership,” “we,” “our” and “us” are used in this report to refer to NuStar Energy L.P., to one or more of our consolidated subsidiaries or to all of them taken as a whole. NuStar GP Holdings, LLC (NuStar GP Holdings) (NYSE: NSH) owns our general partner, Riverwalk Logistics, L.P., and owns a 17.6% total interest in us as of September 30, 2011. We conduct our operations through our subsidiaries, primarily NuStar Logistics, L.P. (NuStar Logistics) and NuStar Pipeline Operating Partnership L.P. (NuPOP). We have three business segments: storage, transportation, and asphalt and fuels marketing. Basis of Presentation These unaudited consolidated financial statements include the accounts of the Partnership and subsidiaries in which the Partnership has a controlling interest. Noncontrolling interests are separately disclosed on the consolidated balance sheets and consolidated statements of income. Intercompany balances and transactions have been eliminated in consolidation. We account for investments in 50% or less-owned entities using the equity method. These unaudited consolidated financial statements have been prepared in accordance with United States generally accepted accounting principles (GAAP) for interim financial information and with the instructions to the Quarterly Report on Form 10-Q and Article 10 of Regulation S-X of the Securities Exchange Act of 1934. Accordingly, they do not include all of the information and notes required by GAAP for complete consolidated financial statements. In the opinion of management, all adjustments considered necessary for a fair presentation have been included, and all disclosures are adequate. All such adjustments are of a normal recurring nature unless disclosed otherwise. Financial information for the three and nine months ended September 30, 2011 and 2010 included in these Condensed Notes to Consolidated Financial Statements is derived from our unaudited consolidated financial statements. Operating results for the three and nine months ended September 30, 2011 are not necessarily indicative of the results that may be expected for the year ending December 31, 2011. The consolidated balance sheet as of December 31, 2010 has been derived from the audited consolidated financial statements as of that date. These unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2010. Reclassifications Certain previously reported amounts in the 2010 consolidated financial statements have been reclassified to conform to the 2011 presentation. Acquisitions On April 19, 2011, we purchased certain refining and storage assets, inventory and other working capital items from AGE Refining, Inc. for $62.0 million, including the assumption of certain environmental liabilities. The assets consist of a 14,500 barrel per day refinery in San Antonio, Texas (the San Antonio Refinery) and 200,000 barrels of storage capacity in Elmendorf, Texas. The purchase price has been preliminarily allocated based on the estimated fair values of the individual assets acquired and liabilities assumed at the date of acquisition, pending completion of an independent appraisal and other evaluations. The consolidated statements of income include the results of operations for our acquisition of the San Antonio Refinery and related storage assets commencing on April 19, 2011. On February 9, 2011, we acquired 75% of the outstanding capital of a Turkish company, which owns two terminals in Mersin, Turkey, with an aggregate 1.3 million barrels of storage capacity, for approximately $57.3 million (the Turkey Acquisition). Both terminals are connected via pipelines to an offshore platform located approximately three miles off the Mediterranean Sea coast. The purchase price has been preliminarily allocated based on the estimated fair values of the individual assets acquired, liabilities assumed and noncontrolling interest at the date of acquisition. The purchase price allocation is pending completion of an independent appraisal and other evaluations. The consolidated statements of income include the results of operations for the Turkey Acquisition commencing on February 9, 2011, with 25% accounted for as a noncontrolling interest. |
DEBT | 9 Months Ended |
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Sep. 30, 2011 | |
DEBT [Abstract] | |
DEBT | DEBT Revolving Credit Agreement During the nine months ended September 30, 2011, we borrowed an aggregate $615.0 million under our $1.2 billion five-year revolving credit agreement (the 2007 Revolving Credit Agreement) to fund a portion of our capital expenditures and working capital requirements. Additionally, we repaid $348.2 million during the nine months ended September 30, 2011. The 2007 Revolving Credit Agreement bears interest based on either an alternative base rate or a LIBOR-based rate. As of September 30, 2011, our weighted average borrowing interest rate was 0.9%, and we had $376.2 million available for borrowing under the 2007 Revolving Credit Agreement. Due to a covenant in our 2007 Revolving Credit Agreement that requires us to maintain, as of the end of any four consecutive fiscal quarters, a consolidated debt coverage ratio not to exceed 5.00-to-1.00, we may not be able to borrow the maximum available amount. On March 7, 2011, we amended the 2007 Revolving Credit Agreement to exclude unused proceeds from the Gulf Opportunity Zone bond issuances from total indebtedness in the calculation of the consolidated debt coverage ratio. As of September 30, 2011, our consolidated debt coverage ratio was 4.5x. Gulf Opportunity Zone Revenue Bonds The Parish of St. James, Louisiana issued, pursuant to the Gulf Opportunity Zone Act of 2005, three separate series of tax-exempt revenue bonds in 2010 and one series of tax-exempt revenue bonds in 2011 (GoZone Bonds) associated with our St. James terminal expansion. The $75.0 million of tax-exempt revenue bonds issued in 2011 mature on August 1, 2041. The interest rate on the GoZone Bonds is based on a weekly tax-exempt bond market interest rate, and interest is paid monthly. The interest rate was 0.2% as of September 30, 2011. Following the issuance, the proceeds were deposited with a trustee and will be disbursed to us upon our request for reimbursement of expenditures related to our St. James terminal expansion. The amount remaining in trust related to the GoZone Bonds is included in “Other long-term assets, net,” and the amount of bonds issued is included in “Long-term debt, less current portion” in our consolidated balance sheets. For the nine months ended September 30, 2011, $92.1 million was disbursed from the trustee. As of September 30, 2011, the amount remaining in trust totaled $187.6 million. Lines of Credit As of September 30, 2011, we had one short-term line of credit with an uncommitted borrowing capacity of up to $20.0 million. We had no outstanding borrowings on this line of credit as of September 30, 2011. During the nine months ended September 30, 2011, we borrowed and repaid $31.6 million related to this line of credit. |
RELATED PARTY TRANSACTIONS Table (Details) (USD $) In Thousands | 3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2011 | Sep. 30, 2010 | Sep. 30, 2011 | Sep. 30, 2010 | |
Related Party Transaction [Line Items] | ||||
Revenues | $ 286 | $ 0 | $ 823 | $ 0 |
Operating expenses | 37,151 | 35,644 | 109,061 | 103,563 |
General and administrative expenses | $ 8,985 | $ 17,133 | $ 41,968 | $ 47,691 |
ORGANIZATION AND BASIS OF PRESENTATION Narrative 2 (Details) (USD $) In Millions, unless otherwise specified | 9 Months Ended |
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Sep. 30, 2011 | |
San Antonio Refinery Acquisition [Member] | |
Business Acquisition [Line Items] | |
Effective date of acquisition | April 19, 2011 |
Purchase price of acquired entity | $ 62.0 |
Acquired refining capacity (in barrels per day) | 14,500 |
Acquired storage capacity (in barrels) | 200,000 |
Turkey Acquisition [Member] | |
Business Acquisition [Line Items] | |
Effective date of acquisition | February 9, 2011 |
Percentage acquired | 75.00% |
Purchase price of acquired entity | $ 57.3 |
Acquired number of terminals | two |
Acquired storage capacity (in barrels) | 1,300,000 |
Ownership percentage held by noncontrolling owners | 25.00% |
SEGMENT INFORMATION Table 1 (Details) (USD $) In Thousands | 3 Months Ended | 9 Months Ended | ||
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Sep. 30, 2011 | Sep. 30, 2010 | Sep. 30, 2011 | Sep. 30, 2010 | |
Revenues: | ||||
Related party | $ 286 | $ 0 | $ 823 | $ 0 |
Total revenues | 1,824,350 | 1,138,379 | 4,648,150 | 3,208,849 |
Operating income: | ||||
Consolidation and intersegment eliminations | 29 | 1 | (16) | 278 |
Total segment operating income | 112,473 | 118,605 | 340,803 | 312,783 |
Less general and administrative expenses | 17,731 | 26,860 | 69,833 | 76,324 |
Less other depreciation and amortization expense | 1,765 | 1,455 | 4,911 | 4,366 |
Total operating income | 92,977 | 90,290 | 266,059 | 232,093 |
Storage Segment | ||||
Revenues: | ||||
Third parties | 128,561 | 120,793 | 381,460 | 353,337 |
Intersegment revenues | 13,042 | 10,344 | 35,925 | 33,241 |
Related party | 286 | 0 | 823 | 0 |
Total | 141,889 | 131,137 | 418,208 | 386,578 |
Operating income: | ||||
Operating income (loss) | 48,778 | 45,635 | 140,322 | 131,388 |
Transportation Segment | ||||
Revenues: | ||||
Third parties | 81,834 | 80,597 | 226,406 | 232,435 |
Intersegment revenues | 65 | 0 | 65 | 382 |
Total | 81,899 | 80,597 | 226,471 | 232,817 |
Operating income: | ||||
Operating income (loss) | 38,248 | 37,512 | 102,808 | 106,004 |
Asphalt and Fuels Marketing Segment | ||||
Revenues: | ||||
Third parties | 1,613,669 | 936,989 | 4,039,461 | 2,623,077 |
Intersegment revenues | 5,024 | 85 | 9,618 | 2,917 |
Total | 1,618,693 | 937,074 | 4,049,079 | 2,625,994 |
Operating income: | ||||
Operating income (loss) | 25,418 | 35,457 | 97,689 | 75,113 |
Intersegment Elimination | ||||
Revenues: | ||||
Intersegment revenues | $ (18,131) | $ (10,429) | $ (45,608) | $ (36,540) |
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
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Sep. 30, 2011 | |
COMMITMENTS AND CONTINGENCIES [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Contingencies We have contingent liabilities resulting from various litigation, claims and commitments, the most significant of which are discussed below. We record accruals for loss contingencies when losses are considered probable and can be reasonably estimated. Legal fees associated with defending the Partnership in legal matters are expensed as incurred. As of September 30, 2011, we have accrued $76.5 million for contingent losses. The amount that will ultimately be paid related to these matters may differ from the amounts accrued, and the timing of such payments is uncertain. Grace Energy Corporation Matter. In 1997, Grace Energy Corporation (Grace Energy) sued subsidiaries of Kaneb Pipeline Partners, L.P. (KPP) and Kaneb Services LLC (KSL and collectively with KPP and their respective subsidiaries, Kaneb) in Texas state court. We acquired Kaneb on July 1, 2005. The complaint sought recovery of the cost of remediation of fuel leaks in the 1970s from a pipeline that had once connected a former Grace Energy terminal with Otis Air Force Base in Massachusetts (Otis AFB). Grace Energy alleges the Otis AFB pipeline and related environmental liabilities had been transferred in 1978 to an entity that was part of Kaneb's acquisition of Support Terminal Services, Inc. and its subsidiaries from Grace Energy in 1993. Kaneb contends that it did not acquire the Otis AFB pipeline and never assumed any responsibility for any associated environmental damage. In 2000, the court entered final judgment that: (i) Grace Energy could not recover its own remediation costs of $3.5 million, (ii) Kaneb owned the Otis AFB pipeline and its related environmental liabilities and (iii) Grace Energy was awarded $1.8 million in attorney costs. Both Kaneb and Grace Energy appealed the final judgment of the trial court to the Texas Court of Appeals in Dallas. In 2001, Grace Energy filed a petition in bankruptcy, which created an automatic stay of actions against Grace Energy. In September 2008, Grace Energy filed its Joint Plan of Reorganization and Disclosure Statement. The Otis AFB is a part of a Superfund Site pursuant to the Comprehensive Environmental Response Compensation and Liability Act (CERCLA). The site contains a number of groundwater contamination plumes, two of which are allegedly associated with the Otis AFB pipeline. Relying on the final judgment of the Texas state court assigning ownership of the Otis AFB pipeline to Kaneb, the United States Department of Justice (the DOJ) advised Kaneb in 2001 that it intends to seek reimbursement from Kaneb for the remediation costs associated with the two plumes. In November 2008, the DOJ forwarded information to us indicating that the past and estimated future remediation expenses associated with one plume are $71.9 million. The DOJ has indicated that they will not seek recovery of remediation costs for the second plume. The DOJ has not filed a lawsuit against us related to this matter, and we have not made any payments toward costs incurred by the DOJ. We are currently in settlement discussions with other potentially responsible parties and the DOJ, and a change in our estimate of this liability may occur in the near term. However, the proposed settlement must be approved by multiple parties and requires the approval of the bankruptcy court and the federal district court. We estimate that a settlement may be finalized in early to mid-2012. Eres Matter. In August 2008, Eres N.V. (Eres) forwarded a demand for arbitration to CITGO Asphalt Refining Company (CARCO), CITGO Petroleum Corporation (CITGO), NuStar Asphalt Refining, LLC (NuStar Asphalt) and NuStar Marketing LLC (NuStar Marketing, and together with CARCO, CITGO and NuStar Asphalt, the Defendants) contending that the Defendants breached a tanker voyage charter party agreement, dated November 2004, between Eres and CARCO (the Charter Agreement). The Charter Agreement provided for CARCO's use of Eres' vessels for the shipment of asphalt. Eres contended that NuStar Asphalt and/or NuStar Marketing (together, the NuStar Entities) assumed the Charter Agreement when NuStar Asphalt purchased the CARCO assets, and that the Defendants had failed to perform under the Charter Agreement. Eres valued its damages for the alleged breach of contract claim at approximately $78.1 million. On October 14, 2011, Eres and the Defendants entered into a Settlement Agreement and Mutual Release. Pursuant to the terms of the Settlement Agreement and Mutual Release, the NuStar Entities paid $33.5 million in full and final settlement of all of Eres' claims against the Defendants. The settlement amount was included in the accrual for contingent losses as of September 30, 2011. Other. We are also a party to additional claims and legal proceedings arising in the ordinary course of business. Due to the inherent uncertainty of litigation, there can be no assurance that the resolution of any particular claim or proceeding would not have a material adverse effect on our results of operations, financial position or liquidity. It is possible that if one or more of the matters described above were decided against us, the effects could be material to our results of operations in the period in which we would be required to record or adjust the related liability and could also be material to our cash flows in the periods we would be required to pay such liability. |
OTHER INCOME (EXPENSE) Table (Details) (USD $) In Thousands | 3 Months Ended | 9 Months Ended | ||
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Sep. 30, 2011 | Sep. 30, 2010 | Sep. 30, 2011 | Sep. 30, 2010 | |
Components of Other Income and Expense Nonoperating [Line Items] | ||||
Contingent Loss Adjustment | $ (3,250) | $ 0 | $ (3,250) | $ 0 |
Storage agreement early termination costs | 0 | 0 | (5,000) | 0 |
Gain from insurance recoveries | 0 | 0 | 0 | 13,500 |
(Loss) gain from sale or disposition of assets | (119) | 114 | 117 | (574) |
Foreign exchange gains (losses) | 3,059 | (333) | 2,483 | (567) |
Other, net | 1,077 | (16) | (49) | 2,523 |
Other income (expense), net | $ 767 | $ (235) | $ (5,699) | $ 14,882 |
SEGMENT INFORMATION (Tables) | 9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2011 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SEGMENT INFORMATION [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Segment Reporting Information, by Segment [Text Block] |
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Schedule of Segment Reporting Information Assets By Segment [Text Block] |
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RELATED PARTY TRANSACTIONS Narrative (Details) (USD $) In Thousands | Sep. 30, 2011 | Dec. 31, 2010 |
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Related Party Transaction [Line Items] | ||
Payable to NuStar GP, LLC | $ 12,369 | $ 10,345 |
Long-term payable to NuStar GP, LLC | $ 11,871 | $ 10,088 |
ORGANIZATION AND BASIS OF PRESENTATION Narrative 1 (Details) | Sep. 30, 2011 |
---|---|
Organizational Structure And Operations [Line Items] | |
Total ownership interest held by general partner | 0.176 |
SEGMENT INFORMATION | 9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2011 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SEGMENT INFORMATION [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SEGMENT INFORMATION | SEGMENT INFORMATION Our reportable business segments consist of storage, transportation, and asphalt and fuels marketing. Our segments represent strategic business units that offer different services and products. We evaluate the performance of each segment based on its respective operating income, before general and administrative expenses and certain non-segmental depreciation and amortization expense. General and administrative expenses are not allocated to the operating segments since those expenses relate primarily to the overall management at the entity level. Our principal operations include terminalling and storage of petroleum products, the transportation of petroleum products and anhydrous ammonia, and petroleum refining and marketing. Intersegment revenues result from storage and throughput agreements with related parties at lease rates consistent with rates charged to third parties for storage and at pipeline tariff rates based upon the applicable published tariff. Results of operations for the reportable segments were as follows:
Total assets by reportable segment were as follows:
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FAIR VALUE MEASUREMENTS | 9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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FAIR VALUE MEASUREMENTS [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS We segregate the inputs used in measuring fair value into three levels: Level 1, defined as observable inputs such as quoted prices in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs in which little or no market data exists. We consider counterparty credit risk and our own credit risk in the determination of all estimated fair values. Product Imbalances We value our assets and liabilities related to product imbalances using quoted market prices as of the reporting date. Interest Rate Swaps We estimate the fair value of both our fixed-to-floating and forward-starting interest rate swaps using discounted cash flows, which use observable inputs such as time to maturity and market interest rates. Commodity Derivatives The fair value of certain of our commodity derivative instruments are based on quoted prices on an exchange; accordingly, these are categorized in Level 1 of the fair value hierarchy. We also have derivative instruments that are are valued using industry pricing services and other observable inputs, such as quoted prices on an exchange for similar derivative instruments. Therefore, these derivative instruments are categorized in Level 2 of the fair value hierarchy. We have consistently applied these valuation techniques in all periods presented. See Note 7. Derivatives and Risk Management Activities for a discussion of our derivative instruments. The following assets and liabilities are measured at fair value:
Fair Value of Financial Instruments We do not record our outstanding debt at fair value in our consolidated balance sheet. The estimated fair value and carrying amount of our debt was as follows:
We estimated the fair values of our debt using a discounted cash flow analysis using current incremental borrowing rates for similar types of borrowing arrangements. |
FAIR VALUE MEASUREMENTS (Tables) | 9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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FAIR VALUE MEASUREMENTS [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value, Measurement Inputs, Disclosure [Text Block] | The following assets and liabilities are measured at fair value:
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Fair Value and Carrying Value of Debt [Text Block] | The estimated fair value and carrying amount of our debt was as follows:
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CONDENSED CONSOLIDATING FINANCIAL STATEMENTS (Tables) | 9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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CONDENSED CONSOLIDATING FINANCIAL STATEMENTS [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Condensed Consolidating Balance Sheet Current Period [Text Block] | Condensed Consolidating Balance Sheets September 30, 2011 (Thousands of Dollars)
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Condensed Consolidating Balance Sheet Prior Period [Text Block] | Condensed Consolidating Balance Sheets December 31, 2010 (Thousands of Dollars)
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Condensed Consolidating Statements of Income Current Period [Text Block] | Condensed Consolidating Statements of Income For the Three Months Ended September 30, 2011 (Thousands of Dollars)
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Condensed Consolidating Statements of Income Prior Period [Text Block] | Condensed Consolidating Statements of Income For the Three Months Ended September 30, 2010 (Thousands of Dollars)
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Condensed Consolidating Statements of Income Current Period YTD [Text Block] | Condensed Consolidating Statements of Income For the Nine Months Ended September 30, 2011 (Thousands of Dollars)
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Condensed Consolidating Statements of Income Prior Period YTD [Text Block] | Condensed Consolidating Statements of Income For the Nine Months Ended September 30, 2010 (Thousands of Dollars)
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Condensed Consolidating Statements of Cash Flows Current Period [Text Block] | Condensed Consolidating Statements of Cash Flows For the Nine Months Ended September 30, 2011 (Thousands of Dollars)
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Condensed Consolidating Statements of Cash Flows Prior Period [Text Block] | Condensed Consolidating Statements of Cash Flows For the Nine Months Ended September 30, 2010 (Thousands of Dollars)
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DERIVATIVES AND RISK MANAGEMENT ACTIVITIES (Tables) | 9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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DERIVATIVES AND RISK MANAGEMENT ACTIVITIES [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value [Text Block] | The fair values of our derivative instruments included in our consolidated balance sheets were as follows:
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Schedule of Derivative Instruments, Gain (Loss) in Statement of Financial Performance [Text Block] | The earnings impact of our derivative activity was as follows:
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PARTNERS' EQUITY Table 2 (Details) (USD $) In Thousands, unless otherwise specified | 3 Months Ended | 9 Months Ended | ||
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Sep. 30, 2011 | Sep. 30, 2010 | Sep. 30, 2011 | Sep. 30, 2010 | |
Net Income Allocation [Line Items] | ||||
Net income attributable to NuStar Energy L.P. | $ 70,158 | $ 68,310 | $ 191,259 | $ 187,435 |
Less general partner incentive distribution | 8,972 | 8,568 | 26,503 | 24,736 |
Net income after general partner incentive distribution | 61,186 | 59,742 | 164,756 | 162,699 |
General partner interest | 2.00% | 2.00% | 2.00% | 2.00% |
General partner allocation of net income after general partner incentive distribution | 1,223 | 1,195 | 3,294 | 3,254 |
General partner incentive distribution | 8,972 | 8,568 | 26,503 | 24,736 |
Net income applicable to general partner | $ 10,195 | $ 9,763 | $ 29,797 | $ 27,990 |
OTHER INCOME (EXPENSE) (Tables) | 9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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OTHER INCOME (EXPENSE) [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Other Nonoperating Income Expense by Component [Text Block] | Other income (expense), net consisted of the following:
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NEW ACCOUNTING PRONOUNCEMENTS NEW ACCOUNTING PRONOUNCEMENTS | 9 Months Ended |
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Sep. 30, 2011 | |
NEW ACCOUNTING PRONOUNCEMENTS [Abstract] | |
NEW ACCOUNTING PRONOUNCEMENTS | NEW ACCOUNTING PRONOUNCEMENTS Goodwill Impairment In September 2011, the Financial Accounting Standards Board (FASB) amended the goodwill impairment guidance to simplify testing goodwill for impairment. The amended guidance provides entities an option to first assess qualitative factors to determine whether it is necessary to perform the two-step quantitative goodwill impairment test. Under that option, an entity would not be required to calculate the fair value of a reporting unit unless the entity determines, based on that qualitative assessment, that it is more likely than not that its fair value is less than its carrying amount. The amended guidance is effective for annual and interim goodwill impairment tests performed for fiscal years beginning after December 15, 2011, and early adoption is permitted. We are evaluating whether to adopt the amended guidance for the 2011 goodwill impairment test performed in the fourth quarter, but we do not expect the amended guidance to have a material impact on our financial position or results of operations. Other Comprehensive Income In June 2011, the FASB amended the disclosure requirements for the presentation of comprehensive income. The amended requirements eliminate the option to present components of other comprehensive income (OCI) as part of the statement of changes in equity. Under the amended requirements, all changes in OCI are to be presented either in a single continuous statement of comprehensive income or in two separate but consecutive financial statements. In addition, entities will be required to disclose reclassification adjustments between other comprehensive income and net income separately on the face of the financial statements. The changes are effective for fiscal years and interim periods beginning after December 15, 2011, and retrospective application is required. Accordingly, we will adopt these provisions January 1, 2012. These amendments only affect financial statement presentation and will not have an impact on our financial position or results of operations. Fair Value Measurements In May 2011, the FASB issued amended guidance and disclosure requirements for fair value measurements. The new guidance results in a consistent definition of fair value and common requirements for measurement of and disclosure about fair value between GAAP and International Financial Reporting Standards. These changes are effective for interim and annual periods beginning on or after December 15, 2011, and early adoption is not permitted. Accordingly, we will adopt these provisions January 1, 2012, and we do not expect the amended guidance to have a material impact on our financial position, results of operations or disclosures. |
NET INCOME PER UNIT | 9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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NET INCOME PER UNIT [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
NET INCOME PER UNIT | NET INCOME PER UNIT We have identified the general partner interest and incentive distribution rights (IDR) as participating securities and use the two-class method when calculating the net income per unit applicable to limited partners, which is based on the weighted-average number of common units outstanding during the period. Basic and diluted net income per unit applicable to limited partners are the same because we have no potentially dilutive securities outstanding. The following table details the calculation of earnings per unit:
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COMMITMENTS AND CONTINGENCIES Narrative (Details) (USD $) In Millions | 3 Months Ended | |
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Dec. 31, 2011 | Sep. 30, 2011 | |
Loss Contingencies [Line Items] | ||
Loss Contingency Accrual, at Carrying Value | $ 76.5 | |
Grace Energy Corporation Matter [Member] | ||
Loss Contingencies [Line Items] | ||
Court Judgment, Remediation Costs Not Recoverable by Plaintiff | 3.5 | |
Court Judgment, Attorney Costs Awarded to Plaintiff | 1.8 | |
Deptartment of Justice Estimated Remediation Expenses | 71.9 | |
Eres Matter [Member] | ||
Loss Contingencies [Line Items] | ||
Loss Contingencies Allegations | 78.1 | |
Loss Contingencies Settlement Amount | $ 33.5 |
INVENTORIES (Tables) | 9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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INVENTORIES [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Inventory Table [Text Block] | Inventories consisted of the following:
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FAIR VALUE MEASUREMENTS Table 2 (Details) (USD $) In Thousands | Sep. 30, 2011 | Dec. 31, 2010 |
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Fair Value and Carrying Value of Debt [Line Items] | ||
Fair value | $ 2,595,533 | $ 2,249,190 |
Carrying amount | $ 2,525,655 | $ 2,137,080 |
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