Delaware
|
65-1295427
|
|
(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
|
|
1000 Louisiana St, Suite 4300, Houston, Texas
|
77002
|
|
(Address of principal executive offices)
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(Zip Code)
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Large accelerated filer R
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Accelerated filer £
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Non-accelerated filer £
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Smaller reporting company £
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PART I—FINANCIAL INFORMATION
|
||
PART II—OTHER INFORMATION
|
||
SIGNATURES
|
||
·
|
our ability to access the debt and equity markets, which will depend on general market conditions and the credit ratings for our debt obligations;
|
·
|
the amount of collateral required to be posted from time to time in our transactions;
|
·
|
our success in risk management activities, including the use of derivative instruments to hedge commodity risks;
|
·
|
the level of creditworthiness of counterparties to transactions;
|
·
|
changes in laws and regulations, particularly with regard to taxes, safety and protection of the environment;
|
·
|
the timing and extent of changes in natural gas, natural gas liquids (“NGL”) and other commodity prices, interest rates and demand for our services;
|
·
|
weather and other natural phenomena;
|
·
|
industry changes, including the impact of consolidations and changes in competition;
|
·
|
our ability to obtain necessary licenses, permits and other approvals;
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·
|
the level and success of oil and natural gas drilling around our assets and our success in connecting natural gas supplies to our gathering and processing systems and NGL supplies to our logistics and marketing facilities;
|
·
|
our ability to grow through acquisitions or internal growth projects and the successful integration and future performance of such assets;
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·
|
general economic, market and business conditions; and
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·
|
the risks described elsewhere in “Part II-Other Information, Item 1A. Risk Factors.” of this Quarterly Report, our Annual Report on Form 10-K for the year ended December 31, 2011 (“Annual Report”) and our reports and registration statements filed from time to time with the United States Securities and Exchange Commission (“SEC”).
|
Bbl
|
Barrels (equal to 42 gallons)
|
Btu
|
British thermal units, a measure of heating value
|
BBtu
|
Billion British thermal units
|
/d
|
Per day
|
/hr
|
Per hour
|
gal
|
U.S. gallons
|
LPG
|
Liquefied petroleum gas
|
MBbl
|
Thousand barrels
|
MMBbl
|
Million barrels
|
MMBtu
|
Million British thermal units
|
MMcf
|
Million cubic feet
|
NGL(s)
|
Natural gas liquid(s)
|
NYMEX
|
New York Mercantile Exchange
|
GAAP
|
Accounting principles generally accepted in the United States of America
|
NYSE
|
New York Stock Exchange
|
Price Index Definitions
|
|
IF-NGPL MC
|
Inside FERC Gas Market Report, Natural Gas Pipeline, Mid-Continent
|
IF-PB
|
Inside FERC Gas Market Report, Permian Basin
|
IF-WAHA
|
Inside FERC Gas Market Report, West Texas WAHA
|
NY-WTI
|
NYMEX, West Texas Intermediate Crude Oil
|
OPIS-MB
|
Oil Price Information Service, Mont Belvieu, Texas
|
TARGA RESOURCES PARTNERS LP
|
||||||
CONSOLIDATED BALANCE SHEETS
|
||||||
|
June 30,
|
December 31,
|
||||
|
2012
|
2011
|
||||
|
(Unaudited)
|
|||||
|
(In millions)
|
|||||
ASSETS
|
|
|
||||
Current assets:
|
|
|
||||
Cash and cash equivalents
|
$ | 89.5 | $ | 55.6 | ||
Trade receivables, net of allowances of $1.9 million and $2.2 million
|
368.1 | 575.9 | ||||
Inventory
|
89.6 | 92.1 | ||||
Assets from risk management activities
|
56.3 | 41.0 | ||||
Other current assets
|
2.2 | 2.7 | ||||
Total current assets
|
605.7 | 767.3 | ||||
Property, plant and equipment
|
4,026.5 | 3,786.9 | ||||
Accumulated depreciation
|
(1,074.2 | ) | (980.8 | ) | ||
Property, plant and equipment, net
|
2,952.3 | 2,806.1 | ||||
Long-term assets from risk management activities
|
21.3 | 10.9 | ||||
Investment in unconsolidated affiliate
|
50.1 | 36.8 | ||||
Other long-term assets
|
37.0 | 36.9 | ||||
Total assets
|
$ | 3,666.4 | $ | 3,658.0 | ||
|
||||||
LIABILITIES AND OWNERS' EQUITY
|
||||||
Current liabilities:
|
||||||
Accounts payable and accrued liabilities
|
$ | 425.5 | $ | 647.8 | ||
Accounts payable to Targa Resources Corp.
|
52.3 | 60.0 | ||||
Liabilities from risk management activities
|
2.8 | 41.1 | ||||
Total current liabilities
|
480.6 | 748.9 | ||||
Long-term debt
|
1,521.0 | 1,477.7 | ||||
Long-term liabilities from risk management activities
|
4.1 | 15.8 | ||||
Deferred income taxes
|
10.7 | 9.5 | ||||
Other long-term liabilities
|
46.4 | 44.4 | ||||
|
||||||
Commitments and contingencies (see Note 11)
|
||||||
|
||||||
Owners' equity:
|
||||||
Common unitholders (89,170,989 and 84,756,009 units issued and outstanding as of June 30, 2012 and December 31, 2011)
|
1,365.5 | 1,221.2 | ||||
General partner (1,819,817 and 1,729,715 units issued and outstanding as of June 30, 2012 and December 31, 2011)
|
33.9 | 27.2 | ||||
Accumulated other comprehensive income (loss)
|
55.9 | (25.6 | ) | |||
|
1,455.3 | 1,222.8 | ||||
Noncontrolling interests in subsidiaries
|
148.3 | 138.9 | ||||
Total owners' equity
|
1,603.6 | 1,361.7 | ||||
Total liabilities and owners' equity
|
$ | 3,666.4 | $ | 3,658.0 | ||
|
||||||
See notes to consolidated financial statements.
|
TARGA RESOURCES PARTNERS LP
|
||||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS
|
||||||||||||
|
|
|
|
|
||||||||
|
|
|
||||||||||
|
Three Months Ended June 30,
|
Six Months Ended June 30,
|
||||||||||
|
2012
|
2011
|
2012
|
2011
|
||||||||
|
(Unaudited)
|
|||||||||||
|
(In millions, except per unit amounts)
|
|||||||||||
Revenues
|
$ | 1,318.4 | $ | 1,726.0 | $ | 2,963.9 | $ | 3,341.1 | ||||
Costs and expenses:
|
||||||||||||
Product purchases
|
1,074.6 | 1,477.8 | 2,458.7 | 2,879.0 | ||||||||
Operating expenses
|
77.2 | 71.6 | 148.8 | 137.6 | ||||||||
Depreciation and amortization expenses
|
47.6 | 44.5 | 94.3 | 87.2 | ||||||||
General and administrative expenses
|
33.5 | 33.2 | 66.4 | 64.9 | ||||||||
Other operating
|
- | - | (0.1 | ) | - | |||||||
Income from operations
|
85.5 | 98.9 | 195.8 | 172.4 | ||||||||
Other income (expense):
|
||||||||||||
Interest expense, net
|
(29.4 | ) | (27.2 | ) | (58.8 | ) | (54.6 | ) | ||||
Equity earnings (loss)
|
(0.2 | ) | 1.3 | 1.9 | 3.0 | |||||||
Loss on mark-to-market derivative instruments
|
- | (3.2 | ) | - | (3.2 | ) | ||||||
Other
|
(0.4 | ) | 0.1 | (0.5 | ) | (0.1 | ) | |||||
Income before income taxes
|
55.5 | 69.9 | 138.4 | 117.5 | ||||||||
Income tax expense:
|
||||||||||||
Current
|
(0.4 | ) | (0.8 | ) | (1.0 | ) | (2.2 | ) | ||||
Deferred
|
(0.4 | ) | (1.1 | ) | (0.8 | ) | (1.5 | ) | ||||
|
(0.8 | ) | (1.9 | ) | (1.8 | ) | (3.7 | ) | ||||
Net income
|
54.7 | 68.0 | 136.6 | 113.8 | ||||||||
Less: Net income attributable to noncontrolling interests
|
7.9 | 12.8 | 19.6 | 20.7 | ||||||||
Net income attributable to Targa Resources Partners LP
|
$ | 46.8 | $ | 55.2 | $ | 117.0 | $ | 93.1 | ||||
|
||||||||||||
Net income attributable to general partner
|
15.4 | 8.9 | 29.5 | 16.5 | ||||||||
Net income attributable to limited partners
|
31.4 | 46.3 | 87.5 | 76.6 | ||||||||
Net income attributable to Targa Resources Partners LP
|
$ | 46.8 | $ | 55.2 | $ | 117.0 | $ | 93.1 | ||||
|
||||||||||||
Net income per limited partner unit - basic and diluted
|
$ | 0.35 | $ | 0.55 | $ | 0.99 | $ | 0.92 | ||||
Weighted average limited partner units outstanding - basic
|
89.2 | 84.8 | 88.6 | 83.5 | ||||||||
Weighted average limited partner units outstanding - diluted
|
89.3 | 84.8 | 88.7 | 83.5 | ||||||||
|
||||||||||||
See notes to consolidated financial statements.
|
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
|
|||||||||||||||||||
|
|
|
|
||||||||||||||||
|
Three Months Ended June 30,
|
||||||||||||||||||
|
2012
|
2011
|
|||||||||||||||||
|
Pre-Tax
|
Related Income Tax
|
After Tax
|
Pre-Tax
|
Related Income Tax
|
After Tax
|
|||||||||||||
|
(Unaudited)
|
||||||||||||||||||
|
(In millions)
|
||||||||||||||||||
Net income
|
|
|
$ | 54.7 |
|
|
$ | 68.0 | |||||||||||
Other comprehensive income:
|
|
|
|
|
|||||||||||||||
Commodity hedging contracts:
|
|
|
|
|
|||||||||||||||
Change in fair value
|
$ | 77.3 | $ | (0.5 | ) | 76.8 | $ | 4.4 | $ | - | 4.4 | ||||||||
Settlements reclassified to revenues
|
(12.9 | ) | 0.1 | (12.8 | ) | 11.9 | - | 11.9 | |||||||||||
Interest rate swaps:
|
|||||||||||||||||||
Change in fair value
|
- | - | - | (2.2 | ) | - | (2.2 | ) | |||||||||||
Settlements reclassified to interest expense, net
|
1.9 | - | 1.9 | 2.2 | - | 2.2 | |||||||||||||
Other comprehensive income
|
$ | 66.3 | $ | (0.4 | ) | 65.9 | $ | 16.3 | $ | - | 16.3 | ||||||||
Comprehensive income
|
$ | 120.6 | $ | 84.3 | |||||||||||||||
Less Comprehensive income attributable to noncontrolling interests
|
7.9 | 12.8 | |||||||||||||||||
Comprehensive income attributable to Targa Resources Partners LP
|
$ | 112.7 | $ | 71.5 | |||||||||||||||
|
|
Six Months Ended June 30,
|
||||||||||||||||||
|
2012
|
2011
|
|||||||||||||||||
|
Pre-Tax
|
Related Income Tax
|
After Tax
|
Pre-Tax
|
Related Income Tax
|
After Tax
|
|||||||||||||
|
(Unaudited)
|
||||||||||||||||||
|
(In millions)
|
||||||||||||||||||
Net income
|
|
|
$ | 136.6 |
|
|
$ | 113.8 | |||||||||||
Other comprehensive income:
|
|
|
|
|
|||||||||||||||
Commodity hedging contracts:
|
|
|
|
|
|||||||||||||||
Change in fair value
|
$ | 92.8 | $ | (0.5 | ) | 92.3 | $ | (56.9 | ) | $ | - | (56.9 | ) | ||||||
Settlements reclassified to revenues
|
(15.1 | ) | 0.1 | (15.0 | ) | 16.5 | - | 16.5 | |||||||||||
Interest rate swaps:
|
|||||||||||||||||||
Change in fair value
|
- | - | - | (1.8 | ) | - | (1.8 | ) | |||||||||||
Settlements reclassified to interest expense, net
|
4.2 | - | 4.2 | 4.6 | - | 4.6 | |||||||||||||
Other comprehensive income
|
$ | 81.9 | $ | (0.4 | ) | 81.5 | $ | (37.6 | ) | $ | - | (37.6 | ) | ||||||
Comprehensive income | 218.1 | 76.2 | |||||||||||||||||
Less: Comprehensive income attributable to noncontrolling interests
|
$ | 19.6 | $ | 20.7 | |||||||||||||||
Comprehensive income attributable to Targa Resources Partners LP
|
198.5 | 55.5 | |||||||||||||||||
|
|||||||||||||||||||
See notes to consolidated financial statements.
|
TARGA RESOURCES PARTNERS LP
|
|||||||||||||||||||
CONSOLIDATED STATEMENTS OF CHANGES IN OWNERS' EQUITY
|
|||||||||||||||||||
|
|
|
|
|
|
|
|
||||||||||||
|
|
|
|
|
Accumulated
|
|
|
||||||||||||
|
Other
|
|
|
||||||||||||||||
|
Limited Partner
|
General Partner
|
Comprehensive
|
Noncontrolling |
|
||||||||||||||
|
Units
|
Amount
|
Units
|
Amount |
Income (Loss)
|
Interests
|
Total
|
||||||||||||
|
(Unaudited)
|
||||||||||||||||||
|
(In millions, except units in thousands)
|
||||||||||||||||||
Balance, December 31, 2011
|
84,756 | $ | 1,221.2 | 1,730 | $ | 27.2 | $ | (25.6 | ) | $ | 138.9 | $ | 1,361.7 | ||||||
Compensation on equity grants
|
10 | 1.6 | - | - | - | - | 1.6 | ||||||||||||
Proceeds from equity offerings
|
4,405 | 164.9 | 90 | 3.5 | - | - | 168.4 | ||||||||||||
Contributions from Targa Resources Corp.
|
- | 0.7 | - | 0.1 | - | - | 0.8 | ||||||||||||
Distributions to noncontrolling interests
|
- | (1.2 | ) | - | - | - | (15.0 | ) | (16.2 | ) | |||||||||
Contributions from noncontrolling interests
|
- | - | - | - | - | 4.8 | 4.8 | ||||||||||||
Other comprehensive income
|
- | - | - | - | 81.5 | - | 81.5 | ||||||||||||
Net income
|
- | 87.5 | - | 29.5 | - | 19.6 | 136.6 | ||||||||||||
Distributions to unitholders
|
- | (109.2 | ) | - | (26.4 | ) | - | - | (135.6 | ) | |||||||||
Balance, June 30, 2012
|
89,171 | $ | 1,365.5 | 1,820 | $ | 33.9 | $ | 55.9 | $ | 148.3 | $ | 1,603.6 | |||||||
|
|||||||||||||||||||
Balance, December 31, 2010
|
75,545 | $ | 935.3 | 1,542 | $ | 15.1 | $ | (30.6 | ) | $ | 129.3 | $ | 1,049.1 | ||||||
Compensation on equity grants
|
11 | 0.8 | - | - | - | - | 0.8 | ||||||||||||
Proceeds from equity offerings
|
9,200 | 298.0 | 188 | 6.3 | - | - | 304.3 | ||||||||||||
Contributions from Targa Resources Corp.
|
- | 4.4 | - | 0.6 | - | - | 5.0 | ||||||||||||
Distributions to noncontrolling interests
|
- | - | - | - | - | (11.6 | ) | (11.6 | ) | ||||||||||
Contributions from noncontrolling interests
|
- | - | - | - | - | 1.3 | 1.3 | ||||||||||||
Other comprehensive loss
|
- | - | - | - | (37.6 | ) | - | (37.6 | ) | ||||||||||
Net income
|
- | 76.6 | - | 16.5 | - | 20.7 | 113.8 | ||||||||||||
Distributions to unitholders
|
- | (93.6 | ) | - | (15.0 | ) | - | - | (108.6 | ) | |||||||||
Balance, June 30, 2011
|
84,756 | $ | 1,221.5 | 1,730 | $ | 23.5 | $ | (68.2 | ) | $ | 139.7 | $ | 1,316.5 | ||||||
|
|||||||||||||||||||
See notes to consolidated financial statements.
|
TARGA RESOURCES PARTNERS LP
|
||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
||||||
|
|
|
||||
|
Six Months Ended June 30,
|
|||||
|
2012
|
2011
|
||||
|
(Unaudited)
|
|||||
|
(In millions)
|
|||||
Cash flows from operating activities
|
|
|
||||
Net income
|
$ | 136.6 | $ | 113.8 | ||
Adjustments to reconcile net income to net cash provided by operating activities:
|
||||||
Amortization in interest expense
|
9.1 | 5.7 | ||||
Compensation on equity grants
|
1.6 | 0.8 | ||||
Depreciation and amortization expense
|
94.3 | 87.2 | ||||
Accretion of asset retirement obligations
|
2.0 | 1.8 | ||||
Deferred income tax expense
|
0.8 | 1.5 | ||||
Risk management activities
|
2.0 | 4.0 | ||||
Gain on sale of assets
|
(0.1 | ) | - | |||
Changes in operating assets and liabilities:
|
||||||
Receivables and other assets
|
209.0 | (47.0 | ) | |||
Inventory
|
(0.3 | ) | (17.4 | ) | ||
Accounts payable and other liabilities
|
(230.0 | ) | 102.3 | |||
Net cash provided by operating activities
|
225.0 | 252.7 | ||||
Cash flows from investing activities
|
||||||
Outlays for property, plant and equipment
|
(238.4 | ) | (135.7 | ) | ||
Business acquisition
|
- | (29.0 | ) | |||
Investment in unconsolidated affiliate
|
(13.7 | ) | (6.0 | ) | ||
Return of capital from unconsolidated affiliate
|
0.4 | 0.6 | ||||
Other, net
|
0.9 | - | ||||
Net cash used in investing activities
|
(250.8 | ) | (170.1 | ) | ||
Cash flows from financing activities
|
||||||
Proceeds from borrowings under credit facility
|
325.0 | 611.0 | ||||
Repayments of credit facility
|
(683.0 | ) | (1,178.3 | ) | ||
Proceeds from issuance of senior notes
|
400.0 | 325.0 | ||||
Cash paid on note exchange
|
- | (27.7 | ) | |||
Proceeds from equity offerings
|
168.4 | 304.3 | ||||
Distributions to unitholders
|
(135.6 | ) | (108.6 | ) | ||
Costs incurred in connection with financing arrangements
|
(4.5 | ) | (6.2 | ) | ||
Contributions from parent
|
0.8 | 5.0 | ||||
Contributions from noncontrolling interests
|
4.8 | 1.3 | ||||
Distributions to noncontrolling interests
|
(16.2 | ) | (11.6 | ) | ||
Net cash provided by (used in) financing activities
|
59.7 | (85.8 | ) | |||
Net change in cash and cash equivalents
|
33.9 | (3.2 | ) | |||
Cash and cash equivalents, beginning of period
|
55.6 | 76.3 | ||||
Cash and cash equivalents, end of period
|
$ | 89.5 | $ | 73.1 | ||
|
||||||
See notes to consolidated financial statements.
|
June 30, 2012
|
December 31, 2011
|
Estimated useful lives
(In years) |
||||||
Natural gas gathering systems
|
$ | 1,774.3 | $ | 1,740.6 |
5 to 20
|
|||
Processing and fractionation facilities
|
1,130.3 | 1,062.7 |
5 to 25
|
|||||
Terminaling and storage facilities
|
400.3 | 380.7 |
5 to 25
|
|||||
Transportation assets
|
291.5 | 281.2 |
10 to 25
|
|||||
Other property, plant and equipment
|
57.8 | 54.9 |
3 to 25
|
|||||
Land
|
72.0 | 71.2 | - | |||||
Construction in progress
|
300.3 | 195.6 | - | |||||
$ | 4,026.5 | $ | 3,786.9 |
June 30, 2012
|
December 31, 2011
|
|||||
Commodities
|
$ | 292.9 | $ | 515.3 | ||
Other goods and services
|
78.0 | 86.3 | ||||
Interest
|
42.8 | 32.3 | ||||
Other
|
11.8 | 13.9 | ||||
$ | 425.5 | $ | 647.8 |
June 30, 2012
|
December 31, 2011
|
|||||
Senior secured revolving credit facility, variable rate, due July 2015 (1)
|
$ | 140.0 | $ | 498.0 | ||
Senior unsecured notes, 8¼% fixed rate, due July 2016
|
209.1 | 209.1 | ||||
Senior unsecured notes, 11¼% fixed rate, due July 2017
|
72.7 | 72.7 | ||||
Unamortized discount
|
(2.7 | ) | (2.9 | ) | ||
Senior unsecured notes, 7⅞% fixed rate, due October 2018
|
250.0 | 250.0 | ||||
Senior unsecured notes, 6⅞% fixed rate, due February 2021
|
483.6 | 483.6 | ||||
Unamortized discount
|
(31.7 | ) | (32.8 | ) | ||
Senior unsecured notes, 6⅜% fixed rate, due August 2022
|
400.0 | - | ||||
$ | 1,521.0 | $ | 1,477.7 | |||
Letters of credit issued
|
$ | 70.2 | $ | 92.5 |
(1)
|
As of June 30, 2012, availability under our $1.1 billion senior secured revolving credit facility was $889.8 million.
|
Range of Interest Rates Incurred
|
Weighted Average Interest Rate Incurred
|
|||
Senior secured revolving credit facility
|
2.5% - 4.5% | 2.8% |
1)
|
at least 65% of the aggregate principal amount of the 6⅜% Notes (excluding the 6⅜% Notes held by us) remains outstanding immediately after the occurrence of such redemption; and
|
2)
|
the redemption occurs within 180 days of the date of the closing of such equity offering.
|
Year
|
Redemption Price
|
||
2017
|
103.188% | ||
2018
|
102.125% | ||
2019
|
101.063% | ||
2020 and thereafter
|
100.000% |
|
|
|
Distributions |
Distributions per limited partner unit
|
|||||||||||||
Three Months Ended
|
|
Date Paid or to be Paid
|
Limited Partners | General Partner |
|
|
|||||||||||
|
Common | Incentive | 2% | Total |
|
||||||||||||
(In millions, except per unit amounts)
|
|||||||||||||||||
June 30, 2012 | August 14, 2012 |
$
|
57.3 |
$
|
14.4 |
$
|
1.5 | $ | 73.2 |
$
|
0.6425 | ||||||
March 31, 2012
|
|
May 15, 2012
|
|
55.5
|
|
12.7
|
|
1.4
|
|
69.6
|
|
0.6225
|
|||||
December 31, 2011
|
|
February 14, 2012
|
|
53.7
|
|
11.0
|
|
1.3
|
|
66.0
|
|
0.6025
|
Commodity
|
Instrument
|
Unit
|
2012
|
2013
|
2014
|
2015
|
|||||||
Natural Gas
|
Swaps
|
MMBtu/d
|
31,790 | 26,089 | 18,000 | 4,500 | |||||||
NGL
|
Swaps
|
Bbl/d
|
9,361 | 5,650 | 1,000 | - | |||||||
NGL
|
Puts (propane)
|
Bbl/d
|
294 | - | - | - | |||||||
NGL
|
Calls (ethane) (1)
|
Bbl/d
|
2,000 | - | - | - | |||||||
Condensate
|
Swaps
|
Bbl/d
|
1,660 | 1,795 | 700 | - |
(1)
|
Utilized in connection with 2,000 Bbl/d of 2012 ethane swaps providing a floor on ethane with upside.
|
|
|
|
Derivative Assets
|
|
Derivative Liabilities
|
||||||||||||
|
|
|
Balance
|
|
Fair Value as of
|
|
Balance
|
|
Fair Value as of
|
||||||||
|
|
|
Sheet
|
|
June 30,
|
|
December 31,
|
|
Sheet
|
|
June 30,
|
|
December 31,
|
||||
|
|
|
Location
|
|
2012
|
|
2011
|
|
Location
|
|
2012
|
|
2011
|
||||
Derivatives designated as hedging instruments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
Commodity contracts
|
Current assets
|
|
$
|
55.4
|
|
$
|
40.3
|
|
Current liabilities
|
$
|
2.6
|
|
$
|
40.6
|
||
|
|
|
Long-term assets |
21.3
|
|
|
10.9
|
|
Long-term liabilities |
|
4.1
|
|
|
15.8
|
|||
Total derivatives designated as hedging instruments
|
|
$
|
76.7
|
|
$
|
51.2
|
|
|
|
$
|
6.7
|
|
$
|
56.4
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Derivatives not designated as hedging instruments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Commodity contracts
|
Current assets
|
|
$
|
0.9
|
|
$
|
0.7
|
|
Current liabilities
|
$
|
0.2
|
|
$
|
0.5
|
||
Total derivatives not designated as hedging instruments
|
$
|
0.9
|
|
$
|
0.7
|
|
|
|
$
|
0.2
|
|
$
|
0.5
|
||||
Total derivatives
|
|
|
|
$
|
77.6
|
|
$
|
51.9
|
|
|
|
$
|
6.9
|
|
$
|
56.9
|
Gain (Loss) Recognized in OCI on Derivatives (Effective Portion)
|
|||||||||||||
Three Months Ended June 30,
|
Six Months Ended June 30,
|
||||||||||||
Derivatives in Cash Flow Hedging Relationships
|
2012
|
2011
|
2012
|
2011
|
|||||||||
Interest rate contracts
|
$ | - | $ | (2.2 | ) | $ | - | $ | (1.8 | ) | |||
Commodity contracts
|
77.3 | 4.4 | 92.8 | (56.9 | ) | ||||||||
|
$ | 77.3 | $ | 2.2 | $ | 92.8 | $ | (58.7 | ) |
|
Gain (Loss) Reclassified from OCI into Income (Effective Portion)
|
||||||||||||
|
Three Months Ended June 30,
|
Six Months Ended June 30,
|
|||||||||||
Location of Gain (Loss)
|
2012
|
2011
|
2012
|
2011
|
|||||||||
Interest expense, net
|
$ | (1.9 | ) | $ | (2.2 | ) | $ | (4.2 | ) | $ | (4.6 | ) | |
Revenues
|
12.9 | (11.9 | ) | 15.1 | (16.5 | ) | |||||||
|
$ | 11.0 | $ | (14.1 | ) | $ | 10.9 | $ | (21.1 | ) |
Gain (Loss) Recognized in Income on Derivatives
|
|||||||||||||||
Three Months Ended June 30,
|
Six Months Ended June 30,
|
||||||||||||||
Derivatives not Designated as Hedging Instruments | Location of Gain Recognized in Income on Derivatives |
2012
|
2011
|
2012
|
2011
|
||||||||||
Commodity contracts
|
Revenue
|
$ | 0.8 | $ | - | $ | 0.9 | $ | 1.0 | ||||||
Interest rate swaps
|
Interest expense
|
- | (3.2 | ) | - | (3.2 | ) |
|
June 30, 2012
|
December 31, 2011
|
|||||
Commodity hedges, before tax
|
$ | 68.3 | $ | (9.4 | ) | ||
Commodity hedges, after tax
|
(12.2 | ) | (16.4 | ) |
·
|
Level 1 – observable inputs such as quoted prices in active markets;
|
·
|
Level 2 – inputs other than quoted prices in active markets that are either directly or indirectly observable to the extent that the markets are liquid for the relevant settlement periods; and
|
·
|
Level 3 – unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.
|
June 30, 2012
|
||||||||||||
Total
|
Level 1
|
Level 2
|
Level 3
|
|||||||||
Assets from commodity derivative contracts
|
$ | 77.6 | $ | - | $ | 77.6 | $ | - | ||||
Liabilities from commodity derivative contracts
|
$ | 6.9 | $ | - | $ | 6.5 | $ | 0.4 | ||||
December 31, 2011
|
||||||||||||
Total
|
Level 1
|
Level 2
|
Level 3
|
|||||||||
Assets from commodity derivative contracts
|
$ | 51.9 | $ | - | $ | 51.9 | $ | - | ||||
Liabilities from commodity derivative contracts
|
$ | 56.9 | $ | - | $ | 56.9 | $ | - |
June 30, 2012
|
||||||||||||
Total
|
Level 1
|
Level 2
|
Level 3
|
|||||||||
Long term debt
|
$ | 1,475.1 | $ | - | $ | 1,475.1 | $ | - |
Commodity Derivative Contracts
|
||||
Balance, December 31, 2011
|
$ | - | ||
Unrealized losses included in OCI
|
0.4 | |||
Transfers into Level 3
|
- | |||
Transfers out of Level 3
|
- | |||
Balance, June 30, 2012
|
$ | 0.4 |
June 30, 2012
|
December 31, 2011
|
|||||||||||
Carrying
|
Fair
|
Carrying
|
Fair
|
|||||||||
Amount
|
Value
|
Amount
|
Value
|
|||||||||
Senior unsecured notes, 8¼% fixed rate
|
$ | 209.1 | $ | 217.8 | $ | 209.1 | $ | 220.5 | ||||
Senior unsecured notes, 11¼% fixed rate
|
70.0 | 82.4 | 69.8 | 82.1 | ||||||||
Senior unsecured notes, 7⅞% fixed rate
|
250.0 | 269.7 | 250.0 | 264.5 | ||||||||
Senior unsecured notes, 6⅞% fixed rate
|
451.9 | 503.9 | 450.8 | 490.2 | ||||||||
Senior unsecured notes, 6⅜% fixed rate
|
400.0 | 401.3 | N/A | N/A |
|
Three Months Ended June 30, 2012
|
|||||||||||||||||||||
|
Field
|
Coastal
|
|
|
|
|
|
|||||||||||||||
|
Gathering
|
Gathering
|
|
Marketing
|
|
Corporate
|
|
|||||||||||||||
|
and
|
and
|
Logistics
|
and
|
|
and
|
|
|||||||||||||||
|
Processing
|
Processing
|
Assets
|
Distribution
|
Other
|
Eliminations
|
Consolidated
|
|||||||||||||||
Revenues
|
|
|
|
|
|
|
|
|||||||||||||||
Sales of commodities
|
$ | 46.6 | $ | 51.7 | $ | 54.5 | $ | 1,068.5 | $ | 12.8 | $ | - | $ | 1,234.1 | ||||||||
Fees from midstream services
|
8.0 | 4.8 | 43.1 | 28.4 | - | - | 84.3 | |||||||||||||||
|
54.6 | 56.5 | 97.6 | 1,096.9 | 12.8 | - | 1,318.4 | |||||||||||||||
Intersegment revenues
|
||||||||||||||||||||||
Sales of commodities
|
259.7 | 162.2 | - | 114.9 | - | (536.8 | ) | - | ||||||||||||||
Fees from midstream services
|
0.3 | - | 24.6 | 7.0 | - | (31.9 | ) | - | ||||||||||||||
|
260.0 | 162.2 | 24.6 | 121.9 | - | (568.7 | ) | - | ||||||||||||||
Revenues
|
$ | 314.6 | $ | 218.7 | $ | 122.2 | $ | 1,218.8 | $ | 12.8 | $ | (568.7 | ) | $ | 1,318.4 | |||||||
Operating margin
|
$ | 53.9 | $ | 28.0 | $ | 45.7 | $ | 26.2 | $ | 12.8 | $ | - | $ | 166.6 | ||||||||
Other financial information:
|
||||||||||||||||||||||
Total assets
|
$ | 1,677.2 | $ | 423.8 | $ | 925.8 | $ | 448.8 | $ | 77.6 | $ | 113.2 | $ | 3,666.4 | ||||||||
Capital expenditures
|
$ | 46.6 | $ | 2.6 | $ | 89.9 | $ | 0.4 | $ | - | $ | 0.9 | $ | 140.4 |
|
Three Months Ended June 30, 2011
|
|||||||||||||||||||||
|
Field
|
Coastal
|
|
|
|
|
|
|||||||||||||||
|
Gathering
|
Gathering
|
|
Marketing
|
|
Corporate
|
|
|||||||||||||||
|
and
|
and
|
Logistics
|
and
|
|
and
|
|
|||||||||||||||
|
Processing
|
Processing
|
Assets
|
Distribution
|
Other
|
Eliminations
|
Consolidated
|
|||||||||||||||
Revenues
|
|
|
|
|
|
|
|
|||||||||||||||
Sales of commodities
|
$ | 51.6 | $ | 89.8 | $ | - | $ | 1,528.9 | $ | (13.2 | ) | $ | (0.1 | ) | $ | 1,657.0 | ||||||
Fees from midstream services
|
6.6 | 4.5 | 33.1 | 24.7 | - | 0.1 | 69.0 | |||||||||||||||
|
58.2 | 94.3 | 33.1 | 1,553.6 | (13.2 | ) | - | 1,726.0 | ||||||||||||||
Intersegment revenues
|
||||||||||||||||||||||
Sales of commodities
|
367.0 | 244.9 | 0.1 | 169.6 | - | (781.6 | ) | - | ||||||||||||||
Fees from midstream services
|
0.2 | - | 23.7 | 9.3 | - | (33.2 | ) | - | ||||||||||||||
|
367.2 | 244.9 | 23.8 | 178.9 | - | (814.8 | ) | - | ||||||||||||||
Revenues
|
$ | 425.4 | $ | 339.2 | $ | 56.9 | $ | 1,732.5 | $ | (13.2 | ) | $ | (814.8 | ) | $ | 1,726.0 | ||||||
Operating margin
|
$ | 80.2 | $ | 45.7 | $ | 33.4 | $ | 30.5 | $ | (13.2 | ) | $ | - | $ | 176.6 | |||||||
Other financial information:
|
||||||||||||||||||||||
Total assets
|
$ | 1,650.4 | $ | 430.5 | $ | 546.9 | $ | 573.1 | $ | 35.7 | $ | 91.8 | $ | 3,328.4 | ||||||||
Capital expenditures
|
$ | 40.0 | $ | 4.2 | $ | 42.5 | $ | 0.8 | $ | - | $ | 0.5 | $ | 88.0 |
|
Six Months Ended June 30, 2012
|
|||||||||||||||||||||
|
Field
|
Coastal
|
|
|
|
|
|
|||||||||||||||
|
Gathering
|
Gathering
|
|
Marketing
|
|
Corporate
|
|
|||||||||||||||
|
and
|
and
|
Logistics
|
and
|
|
and
|
|
|||||||||||||||
|
Processing
|
Processing
|
Assets
|
Distribution
|
Other
|
Eliminations
|
Consolidated
|
|||||||||||||||
Revenues
|
|
|
|
|
|
|
|
|||||||||||||||
Sales of commodities
|
$ | 92.0 | $ | 111.5 | $ | 100.0 | $ | 2,485.8 | $ | 14.1 | $ | - | $ | 2,803.4 | ||||||||
Fees from midstream services
|
18.9 | 8.5 | 82.0 | 51.1 | - | - | 160.5 | |||||||||||||||
|
110.9 | 120.0 | 182.0 | 2,536.9 | 14.1 | - | 2,963.9 | |||||||||||||||
Intersegment revenues
|
||||||||||||||||||||||
Sales of commodities
|
577.1 | 382.2 | - | 246.8 | - | (1,206.1 | ) | - | ||||||||||||||
Fees from midstream services
|
0.6 | 0.1 | 48.7 | 16.3 | - | (65.7 | ) | - | ||||||||||||||
|
577.7 | 382.3 | 48.7 | 263.1 | - | (1,271.8 | ) | - | ||||||||||||||
Revenues
|
$ | 688.6 | $ | 502.3 | $ | 230.7 | $ | 2,800.0 | $ | 14.1 | $ | (1,271.8 | ) | $ | 2,963.9 | |||||||
Operating margin
|
$ | 126.9 | $ | 74.3 | $ | 88.7 | $ | 52.4 | $ | 14.1 | $ | - | $ | 356.4 | ||||||||
Other financial information:
|
||||||||||||||||||||||
Total assets
|
$ | 1,677.2 | $ | 423.8 | $ | 925.8 | $ | 448.8 | $ | 77.6 | $ | 113.2 | $ | 3,666.4 | ||||||||
Capital expenditures
|
$ | 72.8 | $ | 4.6 | $ | 150.0 | $ | 9.5 | $ | - | $ | 1.5 | $ | 238.4 |
|
Six Months Ended June 30, 2011
|
|||||||||||||||||||||
|
Field
|
Coastal
|
|
|
|
|
|
|||||||||||||||
|
Gathering
|
Gathering
|
|
Marketing
|
|
Corporate
|
|
|||||||||||||||
|
and
|
and
|
Logistics
|
and
|
|
and
|
|
|||||||||||||||
|
Processing
|
Processing
|
Assets
|
Distribution
|
Other
|
Eliminations
|
Consolidated
|
|||||||||||||||
Revenues
|
|
|
|
|
|
|
|
|||||||||||||||
Sales of commodities
|
$ | 97.4 | $ | 168.7 | $ | 0.1 | $ | 2,975.2 | $ | (17.6 | ) | $ | - | $ | 3,223.8 | |||||||
Fees from midstream services
|
12.8 | 9.6 | 56.3 | 38.6 | - | - | 117.3 | |||||||||||||||
|
110.2 | 178.3 | 56.4 | 3,013.8 | (17.6 | ) | - | 3,341.1 | ||||||||||||||
Intersegment revenues
|
||||||||||||||||||||||
Sales of commodities
|
666.4 | 461.9 | 0.2 | 279.9 | - | (1,408.4 | ) | - | ||||||||||||||
Fees from midstream services
|
0.5 | 0.4 | 42.7 | 17.0 | - | (60.6 | ) | - | ||||||||||||||
|
666.9 | 462.3 | 42.9 | 296.9 | - | (1,469.0 | ) | - | ||||||||||||||
Revenues
|
$ | 777.1 | $ | 640.6 | $ | 99.3 | $ | 3,310.7 | $ | (17.6 | ) | $ | (1,469.0 | ) | $ | 3,341.1 | ||||||
Operating margin
|
$ | 141.3 | $ | 82.0 | $ | 55.7 | $ | 63.1 | $ | (17.6 | ) | $ | - | $ | 324.5 | |||||||
Other financial information:
|
||||||||||||||||||||||
Total assets
|
$ | 1,650.4 | $ | 430.5 | $ | 546.9 | $ | 573.1 | $ | 35.7 | $ | 91.8 | $ | 3,328.4 | ||||||||
Capital expenditures
|
$ | 71.8 | $ | 5.6 | $ | 87.6 | $ | 0.9 | $ | - | $ | 0.6 | $ | 166.5 |
Three Months Ended June 30,
|
Six Months Ended June 30,
|
||||||||||||
2012
|
2011
|
2012
|
2011
|
||||||||||
Sales of commodities
|
|||||||||||||
Natural gas sales
|
$ | 188.0 | $ | 292.9 | $ | 390.7 | $ | 541.7 | |||||
NGL sales
|
950.7 | 1,344.0 | 2,240.9 | 2,645.7 | |||||||||
Condensate sales
|
29.0 | 33.1 | 58.0 | 54.6 | |||||||||
Petroleum products
|
54.3 | - | 99.8 | - | |||||||||
Derivative activities
|
12.1 | (13.0 | ) | 14.0 | (18.2 | ) | |||||||
1,234.1 | 1,657.0 | 2,803.4 | 3,223.8 | ||||||||||
Fees from midstream services
|
|||||||||||||
Fractionating and treating fees
|
28.6 | 23.3 | 55.5 | 34.4 | |||||||||
Storage, terminaling, transportation and export fees
|
35.4 | 24.8 | 65.8 | 49.4 | |||||||||
Gas processing fees
|
9.8 | 7.7 | 18.3 | 14.8 | |||||||||
Other
|
10.5 | 13.2 | 20.9 | 18.7 | |||||||||
84.3 | 69.0 | 160.5 | 117.3 | ||||||||||
Total revenues
|
$ | 1,318.4 | $ | 1,726.0 | $ | 2,963.9 | $ | 3,341.1 |
Three Months Ended June 30,
|
Six Months Ended June 30,
|
||||||||||||
2012
|
2011
|
2012
|
2011
|
||||||||||
Reconciliation of operating margin to net income:
|
|||||||||||||
Operating margin
|
$ | 166.6 | $ | 176.6 | $ | 356.4 | $ | 324.5 | |||||
Depreciation and amortization expense
|
(47.6 | ) | (44.5 | ) | (94.3 | ) | (87.2 | ) | |||||
General and administrative expense
|
(33.5 | ) | (33.2 | ) | (66.4 | ) | (64.9 | ) | |||||
Interest expense, net
|
(29.4 | ) | (27.2 | ) | (58.8 | ) | (54.6 | ) | |||||
Income tax expense
|
(0.8 | ) | (1.9 | ) | (1.8 | ) | (3.7 | ) | |||||
Other, net
|
(0.6 | ) | (1.8 | ) | 1.5 | (0.3 | ) | ||||||
Net income
|
$ | 54.7 | $ | 68.0 | $ | 136.6 | $ | 113.8 |
·
|
the financial performance of our assets without regard to financing methods, capital structure or historical cost basis;
|
·
|
our operating performance and return on capital as compared to other companies in the midstream energy sector, without regard to financing or capital structure; and
|
·
|
the viability of acquisitions and capital expenditure projects and the overall rates of return on alternative investment opportunities.
|
Three Months Ended June 30,
|
Six Months Ended June 30,
|
||||||||||||
2012
|
2011
|
2012
|
2011
|
||||||||||
Reconciliation of gross margin and operating margin to net income:
|
(In millions)
|
||||||||||||
Gross margin
|
$ | 243.8 | $ | 248.2 | $ | 505.2 | $ | 462.1 | |||||
Operating expenses
|
(77.2 | ) | (71.6 | ) | (148.8 | ) | (137.6 | ) | |||||
Operating margin
|
166.6 | 176.6 | 356.4 | 324.5 | |||||||||
Depreciation and amortization expenses
|
(47.6 | ) | (44.5 | ) | (94.3 | ) | (87.2 | ) | |||||
General and administrative expenses
|
(33.5 | ) | (33.2 | ) | (66.4 | ) | (64.9 | ) | |||||
Other operating income (loss)
|
- | - | 0.1 | - | |||||||||
Interest expense, net
|
(29.4 | ) | (27.2 | ) | (58.8 | ) | (54.6 | ) | |||||
Income tax expense
|
(0.8 | ) | (1.9 | ) | (1.8 | ) | (3.7 | ) | |||||
Other, net
|
(0.6 | ) | (1.8 | ) | 1.4 | (0.3 | ) | ||||||
Net income
|
$ | 54.7 | $ | 68.0 | $ | 136.6 | $ | 113.8 |
Three Months Ended June 30,
|
Six Months Ended June 30,
|
||||||||||||
2012
|
2011
|
2012
|
2011
|
||||||||||
(In millions)
|
|||||||||||||
Reconciliation of net cash provided by operating activities to Adjusted EBITDA:
|
|||||||||||||
Net cash provided by operating activities
|
$ | 78.3 | $ | 154.1 | $ | 225.0 | $ | 252.7 | |||||
Net income attributable to noncontrolling interests
|
(7.9 | ) | (12.8 | ) | (19.6 | ) | (20.7 | ) | |||||
Interest expense, net (1)
|
24.9 | 23.2 | 49.7 | 48.9 | |||||||||
Current income tax expense
|
0.4 | 0.8 | 1.0 | 2.2 | |||||||||
Other (2)
|
(4.2 | ) | (6.1 | ) | (9.1 | ) | (8.0 | ) | |||||
Changes in operating assets and liabilities which used (provided) cash:
|
|||||||||||||
Accounts receivable and other assets
|
(50.5 | ) | 135.7 | (208.7 | ) | 64.4 | |||||||
Accounts payable and other liabilities
|
81.9 | (165.1 | ) | 230.0 | (102.3 | ) | |||||||
Adjusted EBITDA
|
$ | 122.9 | $ | 129.8 | $ | 268.3 | $ | 237.2 |
(1)
|
Net of amortization of debt issuance costs, discount and premium included in interest expense of $4.4 million and $8.9 million for the three and six months ended June 30, 2012; and $3.8 million and $5.7 million for the three and six months ended June 30, 2011.
|
(2)
|
Includes equity earnings (loss) from unconsolidated investments – net of distributions, accretion expense associated with asset retirement obligations, amortization of stock based compensation and gain (loss) on sale of assets.
|
Three Months Ended June 30,
|
Six Months Ended June 30,
|
||||||||||||
2012
|
2011
|
2012
|
2011
|
||||||||||
(In millions)
|
|||||||||||||
Reconciliation of net income attributable to Targa Resources Partners LP to Adjusted EBITDA:
|
|||||||||||||
Net income attributable to Targa Resources Partners LP
|
$ | 46.8 | $ | 55.2 | $ | 117.0 | $ | 93.1 | |||||
Add:
|
|||||||||||||
Interest expense, net
|
29.4 | 27.2 | 58.8 | 54.6 | |||||||||
Income tax expense
|
0.8 | 1.9 | 1.8 | 3.7 | |||||||||
Depreciation and amortization expenses
|
47.6 | 44.5 | 94.3 | 87.2 | |||||||||
Risk management activities
|
1.2 | 3.8 | 2.2 | 4.0 | |||||||||
Noncontrolling interests adjustment (1)
|
(2.9 | ) | (2.8 | ) | (5.8 | ) | (5.4 | ) | |||||
Adjusted EBITDA
|
$ | 122.9 | $ | 129.8 | $ | 268.3 | $ | 237.2 |
(1)
|
Noncontrolling interest portion of depreciation and amortization expenses.
|
Three Months Ended June 30,
|
Six Months Ended June 30,
|
||||||||||||
2012
|
2011
|
2012
|
2011
|
||||||||||
(In millions)
|
|||||||||||||
Reconciliation of net income attributable to Targa Resources Partners LP to distributable cash flow:
|
|||||||||||||
Net income attributable to Targa Resources Partners LP
|
$ | 46.8 | $ | 55.2 | $ | 117.0 | $ | 93.1 | |||||
Depreciation and amortization expenses
|
47.6 | 44.5 | 94.3 | 87.2 | |||||||||
Deferred income tax expense
|
0.4 | 1.1 | 0.8 | 1.5 | |||||||||
Amortization in interest expense
|
4.4 | 3.8 | 8.9 | 5.7 | |||||||||
Risk management activities
|
1.2 | 3.8 | 2.2 | 4.0 | |||||||||
Maintenance capital expenditures
|
(15.5 | ) | (21.6 | ) | (31.9 | ) | (32.6 | ) | |||||
Other (1)
|
(0.4 | ) | 3.2 | (1.1 | ) | 5.2 | |||||||
Distributable cash flow
|
$ | 84.5 | $ | 90.0 | $ | 190.2 | $ | 164.1 |
(1)
|
Includes reimbursements of certain environmental maintenance capital expenditures by Targa and the noncontrolling interest portion of maintenance capital expenditures, depreciation and amortization expense.
|
Three Months Ended June 30,
|
Six Months Ended June 30,
|
||||||||||||||||||||||
2012
|
2011
|
2012 vs. 2011
|
2012
|
2011
|
2012 vs. 2011
|
||||||||||||||||||
Revenues
|
$ | 1,318.4 | $ | 1,726.0 | $ | (407.6 | ) | (24% | ) | $ | 2,963.9 | $ | 3,341.1 | $ | (377.2 | ) | (11% | ) | |||||
Product purchases
|
1,074.6 | 1,477.8 | (403.2 | ) | (27% | ) | 2,458.7 | 2,879.0 | (420.3 | ) | (15% | ) | |||||||||||
Gross margin (1)
|
243.8 | 248.2 | (4.4 | ) | (2% | ) | 505.2 | 462.1 | 43.1 | 9% | |||||||||||||
Operating expenses
|
77.2 | 71.6 | 5.6 | 8% | 148.8 | 137.6 | 11.2 | 8% | |||||||||||||||
Operating margin (2)
|
166.6 | 176.6 | (10.0 | ) | (6% | ) | 356.4 | 324.5 | 31.9 | 10% | |||||||||||||
Depreciation and
amortization expenses
|
47.6 | 44.5 | 3.1 | 7% | 94.3 | 87.2 | 7.1 | 8% | |||||||||||||||
General and
administrative expenses
|
33.5 | 33.2 | 0.3 | 1% | 66.4 | 64.9 | 1.5 | 2% | |||||||||||||||
Other
|
- | - | - | - | (0.1 | ) | - | (0.1 | ) | - | |||||||||||||
Income from operations
|
85.5 | 98.9 | (13.4 | ) | (14% | ) | 195.8 | 172.4 | 23.4 | 14% | |||||||||||||
Interest expense, net
|
(29.4 | ) | (27.2 | ) | (2.2 | ) | 8% | (58.8 | ) | (54.6 | ) | (4.2 | ) | 8% | |||||||||
Equity earnings (loss)
|
(0.2 | ) | 1.3 | (1.5 | ) | (115% | ) | 1.9 | 3.0 | (1.1 | ) | (37% | ) | ||||||||||
Loss on mark-to-market
derivative instruments
|
- | (3.2 | ) | 3.2 | 100% | - | (3.2 | ) | 3.2 | 100% | |||||||||||||
Other
|
(0.4 | ) | 0.1 | (0.5 | ) | (500% | ) | (0.5 | ) | (0.1 | ) | (0.4 | ) | (400% | ) | ||||||||
Income tax expense
|
(0.8 | ) | (1.9 | ) | 1.1 | 58% | (1.8 | ) | (3.7 | ) | 1.9 | 51% | |||||||||||
Net income
|
54.7 | 68.0 | (13.3 | ) | (20% | ) | 136.6 | 113.8 | 22.8 | 20% | |||||||||||||
Less: Net income attributable to
noncontrolling interests
|
7.9 | 12.8 | (4.9 | ) | (38% | ) | 19.6 | 20.7 | (1.1 | ) | (5% | ) | |||||||||||
Net income attributable to
Targa Resources Partners LP
|
$ | 46.8 | $ | 55.2 | $ | (8.4 | ) | (15% | ) | $ | 117.0 | $ | 93.1 | $ | 23.9 | 26% | |||||||
Financial and operating data:
|
|||||||||||||||||||||||
Financial data:
|
|||||||||||||||||||||||
Adjusted EBITDA (3)
|
$ | 122.9 | $ | 129.8 | $ | (6.9 | ) | (5% | ) | $ | 268.3 | $ | 237.2 | $ | 31.1 | 13% | |||||||
Distributable cash flow (4)
|
84.5 | 90.0 | (5.5 | ) | (6% | ) | 190.2 | 164.1 | 26.1 | 16% | |||||||||||||
Operating data:
|
|||||||||||||||||||||||
Plant natural gas inlet, MMcf/d (5)(6)
|
2,083.0 | 2,203.6 | (120.6 | ) | (5% | ) | 2,157.8 | 2,186.2 | (28.4 | ) | (1% | ) | |||||||||||
Gross NGL production, MBbl/d
|
124.0 | 126.1 | (2.1 | ) | (2% | ) | 128.1 | 122.6 | 5.5 | 4% | |||||||||||||
Natural gas sales, BBtu/d (6)
|
930.3 | 756.3 | 174.0 | 23% | 895.4 | 719.6 | 175.8 | 24% | |||||||||||||||
NGL sales, MBbl/d
|
270.3 | 261.0 | 9.3 | 4% | 274.7 | 268.3 | 6.4 | 2% | |||||||||||||||
Condensate sales, MBbl/d
|
3.7 | 3.7 | - | - | 3.4 | 3.1 | 0.3 | 10% |
(1)
|
Gross margin is a non-GAAP financial measure and is discussed under “Management’s Discussion and Analysis of Financial Condition and Results of Operations – How We Evaluate Our Operations” and “Non-GAAP Financial Measures.”
|
(2)
|
Operating margin is a non-GAAP financial measure and is discussed under “Management’s Discussion and Analysis of Financial Condition and Results of Operations – How We Evaluate Our Operations” and “Non-GAAP Financial Measures.”
|
(3)
|
Adjusted EBITDA is net income before interest, income taxes, depreciation and amortization, gains or losses on debt repurchases and non-cash risk management activities related to derivative instruments. This is a non-GAAP financial measure and is discussed under “Management’s Discussion and Analysis of Financial Condition and Results of Operations – How We Evaluate Our Operations” and “Non-GAAP Financial Measures.”
|
(4)
|
Distributable cash flow is net income attributable to Targa Resources Partners LP plus depreciation and amortization, deferred taxes and amortization of debt issue costs included in interest expense, adjusted for losses (gains) on mark-to-market derivative contracts and debt repurchases, less maintenance capital expenditures (net of any reimbursements of project costs). This is a non-GAAP financial measure and is discussed under “Management’s Discussion and Analysis of Financial Condition and Results of Operations – How We Evaluate Our Operations” and “Non-GAAP Financial Measures.”
|
(5)
|
Plant natural gas inlet represents the volume of natural gas passing through the meter located at the inlet of a natural gas processing plant.
|
(6)
|
Plant natural gas inlet volumes include producer take-in-kind volumes, while natural gas sales exclude producer take-in-kind volumes.
|
Field
|
Coastal
|
||||||||||||||||
Gathering
|
Gathering
|
Marketing
|
|||||||||||||||
and
|
and
|
Logistics
|
and
|
||||||||||||||
Processing
|
Processing
|
Assets
|
Distribution
|
Other
|
Total
|
||||||||||||
Three Months Ended:
|
(In millions)
|
||||||||||||||||
June 30, 2012
|
$
|
53.9
|
$
|
28.0
|
$
|
45.7
|
$
|
26.2
|
$
|
12.8
|
$
|
166.6
|
|||||
June 30, 2011
|
80.2
|
45.7
|
33.4
|
30.5
|
(13.2)
|
176.6
|
|||||||||||
Six Months Ended:
|
|||||||||||||||||
June 30, 2012
|
126.9
|
74.3
|
88.7
|
52.4
|
14.1
|
356.4
|
|||||||||||
June 30, 2011
|
141.3
|
82.0
|
55.7
|
63.1
|
(17.6)
|
324.5
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||||||||||
|
2012
|
2011
|
2012 vs. 2011
|
2012
|
2011
|
2012 vs. 2011
|
|||||||||||||||||
|
($ in millions)
|
||||||||||||||||||||||
Gross margin
|
$ | 85.0 | $ | 109.1 | $ | (24.1 | ) | (22% | ) | $ | 187.3 | $ | 197.0 | $ | (9.7 | ) | (5% | ) | |||||
Operating expenses
|
31.1 | 28.9 | 2.2 | 8% | 60.4 | 55.7 | 4.7 | 8% | |||||||||||||||
Operating margin
|
$ | 53.9 | $ | 80.2 | $ | (26.3 | ) | (33% | ) | $ | 126.9 | $ | 141.3 | $ | (14.4 | ) | (10% | ) | |||||
Operating statistics (1):
|
|||||||||||||||||||||||
Plant natural gas inlet, MMcf/d (2),(3)
|
665.1 | 611.7 | 53.4 | 9% | 660.2 | 592.4 | 67.8 | 11% | |||||||||||||||
Gross NGL production, MBbl/d
|
81.1 | 74.6 | 6.5 | 9% | 80.1 | 72.0 | 8.1 | 11% | |||||||||||||||
Natural gas sales, BBtu/d (3)
|
312.6 | 284.4 | 28.2 | 10% | 313.0 | 273.8 | 39.2 | 14% | |||||||||||||||
NGL sales, MBbl/d
|
67.5 | 59.9 | 7.6 | 13% | 66.2 | 58.2 | 8.0 | 14% | |||||||||||||||
Condensate sales, MBbl/d
|
3.5 | 3.4 | 0.1 | 3% | 3.2 | 2.8 | 0.4 | 14% | |||||||||||||||
Average realized prices (4):
|
|||||||||||||||||||||||
Natural gas, $/MMBtu
|
2.02 | 4.04 | (2.02 | ) | (50% | ) | 2.29 | 3.92 | (1.63 | ) | (42% | ) | |||||||||||
NGL, $/gal
|
0.86 | 1.24 | (0.38 | ) | (31% | ) | 0.96 | 1.18 | (0.22 | ) | (19% | ) | |||||||||||
Condensate, $/Bbl
|
86.51 | 98.13 | (11.62 | ) | (12% | ) | 92.34 | 95.27 | (2.93 | ) | (3% | ) |
(1)
|
Segment operating statistics include the effect of intersegment sales, which have been eliminated from the consolidated presentation. For all volume statistics presented, the numerator is the total volume sold during the quarter and the denominator is the number of calendar days during the quarter.
|
(2)
|
Plant natural gas inlet represents the volume of natural gas passing through the meter located at the inlet of a natural gas processing plant.
|
(3)
|
Plant natural gas inlet volumes include producer take-in-kind volumes, while natural gas sales exclude producer take-in-kind volumes.
|
(4)
|
Average realized prices exclude the impact of hedging activities presented in Other on page 30.
|
|
Three Months Ended June 30,
|
|
|
Six Months Ended June 30,
|
|
|
|||||||||||||||||
|
2012
|
2011
|
2012 vs. 2011
|
2012
|
2011
|
2012 vs. 2011
|
|||||||||||||||||
|
($ in millions)
|
||||||||||||||||||||||
Gross margin
|
$ | 38.8 | $ | 57.1 | $ | (18.3 | ) | (32% | ) | $ | 95.5 | $ | 103.6 | $ | (8.1 | ) | (8% | ) | |||||
Operating expenses
|
10.8 | 11.4 | (0.6 | ) | (5% | ) | 21.2 | 21.6 | (0.4 | ) | (2% | ) | |||||||||||
Operating margin
|
$ | 28.0 | $ | 45.7 | $ | (17.7 | ) | (39% | ) | $ | 74.3 | $ | 82.0 | $ | (7.7 | ) | (9% | ) | |||||
Operating statistics (1):
|
|||||||||||||||||||||||
Plant natural gas inlet, MMcf/d (2),(3)
|
1,417.9 | 1,591.9 | (174.0 | ) | (11% | ) | 1,497.6 | 1,593.9 | (96.3 | ) | (6% | ) | |||||||||||
Gross NGL production, MBbl/d
|
42.9 | 51.5 | (8.6 | ) | (17% | ) | 48.0 | 50.6 | (2.6 | ) | (5% | ) | |||||||||||
Natural gas sales, BBtu/d (3)
|
315.1 | 272.0 | 43.1 | 16% | 298.5 | 263.3 | 35.2 | 13% | |||||||||||||||
NGL sales, MBbl/d
|
40.7 | 43.8 | (3.1 | ) | (7% | ) | 44.0 | 43.7 | 0.3 | 1% | |||||||||||||
Condensate sales, MBbl/d
|
0.2 | 0.3 | (0.1 | ) | (33% | ) | 0.2 | 0.3 | (0.1 | ) | (33% | ) | |||||||||||
Average realized prices:
|
|||||||||||||||||||||||
Natural gas, $/MMBtu
|
2.27 | 4.35 | (2.08 | ) | (48% | ) | 2.43 | 4.25 | (1.82 | ) | (43% | ) | |||||||||||
NGL, $/gal (4)
|
0.95 | 1.34 | (0.39 | ) | (29% | ) | 1.06 | 1.27 | (0.21 | ) | (17% | ) | |||||||||||
Condensate, $/Bbl (4)
|
91.40 | 109.05 | (17.65 | ) | (16% | ) | 111.64 | 100.51 | 11.13 | 11% |
(1)
|
Segment operating statistics include the effect of intersegment sales, which have been eliminated from the consolidated presentation. For all volume statistics presented, the numerator is the total volume sold during the quarter and the denominator is the number of calendar days during the quarter.
|
(2)
|
Plant natural gas inlet represents the volume of natural gas passing through the meter located at the inlet of a natural gas processing plant.
|
(3)
|
Plant natural gas inlet volumes include producer take-in-kind volumes, while natural gas sales exclude producer take-in-kind volumes.
|
(4)
|
Average realized prices exclude the impact of hedging activities presented in Other on page 30.
|
|
Three Months Ended June 30,
|
|
|
Six Months Ended June 30,
|
|
|
|||||||||||||||||
|
2012
|
2011
|
2012 vs. 2011
|
2012
|
2011
|
2012 vs. 2011
|
|||||||||||||||||
|
($ in millions)
|
||||||||||||||||||||||
Gross margin
|
$ | 69.1 | $ | 56.9 | $ | 12.2 | 21% | $ | 133.5 | $ | 99.3 | $ | 34.2 | 34% | |||||||||
Operating expenses
|
23.4 | 23.5 | (0.1 | ) | (0% | ) | 44.8 | 43.6 | 1.2 | 3% | |||||||||||||
Operating margin
|
$ | 45.7 | $ | 33.4 | $ | 12.3 | 37% | $ | 88.7 | $ | 55.7 | $ | 33.0 | 59% | |||||||||
Operating statistics (1):
|
|||||||||||||||||||||||
Fractionation volumes, MBbl/d
|
311.3 | 279.7 | 31.6 | 11% | 302.5 | 244.7 | 57.8 | 24% | |||||||||||||||
Treating volumes, MBbl/d (2)
|
27.1 | 27.8 | (0.7 | ) | (3% | ) | 23.1 | 19.1 | 4.0 | 21% |
(1)
|
Segment operating statistics include the effect of intersegment sales, which have been eliminated from the consolidated presentation. For all volume statistics presented, the numerator is the total volume sold during the quarter and the denominator is the number of calendar days during the quarter.
|
(2)
|
Includes the volumes related to the natural gasoline hydrotreater at our Mt. Belvieu facility.
|
|
Three Months Ended June 30,
|
|
|
Six Months Ended June 30,
|
|
|
|||||||||||||||||
|
2012
|
2011
|
2012 vs. 2011
|
2012
|
2011
|
2012 vs. 2011
|
|||||||||||||||||
|
($ in millions)
|
||||||||||||||||||||||
Gross margin
|
$ | 35.4 | $ | 41.4 | $ | (6.0 | ) | (14% | ) | $ | 70.8 | $ | 85.9 | $ | (15.1 | ) | (18% | ) | |||||
Operating expenses
|
9.2 | 10.9 | (1.7 | ) | (16% | ) | 18.4 | 22.8 | (4.4 | ) | (19% | ) | |||||||||||
Operating margin
|
$ | 26.2 | $ | 30.5 | $ | (4.3 | ) | (14% | ) | $ | 52.4 | $ | 63.1 | $ | (10.7 | ) | (17% | ) | |||||
Operating statistics (1):
|
|||||||||||||||||||||||
Natural gas sales, BBtu/d
|
1,096.1 | 857.5 | 238.6 | 28% | 1,059.8 | 761.4 | 298.4 | 39% | |||||||||||||||
NGL sales, MBbl/d
|
274.4 | 265.0 | 9.4 | 4% | 278.5 | 268.7 | 9.8 | 4% | |||||||||||||||
Average realized prices:
|
|||||||||||||||||||||||
Natural gas, $/MMBtu
|
2.21 | 4.28 | (2.07 | ) | (48% | ) | 2.40 | 4.19 | (1.79 | ) | (43% | ) | |||||||||||
NGL realized price, $/gal
|
0.92 | 1.35 | (0.43 | ) | (32% | ) | 1.07 | 1.31 | (0.24 | ) | (18% | ) |
(1)
|
Segment operating statistics include the effect of intersegment sales, which have been eliminated from the consolidated presentation. For all volume statistics presented, the numerator is the total volume sold during the quarter and the denominator is the number of calendar days during the quarter.
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
|
|||||||||||||||
|
2012
|
2011
|
2012 vs. 2011
|
2012
|
2011
|
2012 vs. 2011
|
|||||||||||||
|
(In millions)
|
||||||||||||||||||
Gross margin
|
$ | 12.8 | $ | (13.2 | ) | $ | 26.0 | $ | 14.1 | $ | (17.6 | ) | $ | 31.7 | |||||
Operating margin
|
$ | 12.8 | $ | (13.2 | ) | $ | 26.0 | $ | 14.1 | $ | (17.6 | ) | $ | 31.7 |
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
|
|||||||||||||||
|
2012
|
2011
|
2012 vs. 2011
|
2012
|
2011
|
2012 vs. 2011
|
|||||||||||||
|
(In millions)
|
||||||||||||||||||
Natural gas
|
$ | 10.4 | $ | 1.6 | $ | 8.8 | $ | 19.0 | $ | 7.8 | $ | 11.2 | |||||||
NGL | 3.0 | (13.3 | ) | 16.3 | (2.6 | ) | (22.2 | ) | 19.6 | ||||||||||
Crude oil | (0.6 | ) | (1.5 | ) | 0.9 | (2.3 | ) | (3.2 | ) | 0.9 | |||||||||
|
$ | 12.8 | $ | (13.2 | ) | $ | 26.0 | $ | 14.1 | $ | (17.6 | ) | $ | 31.7 |
June 30, 2012
|
December 31, 2011
|
|||||
(In millions)
|
||||||
Cash on hand
|
$ | 89.5 | $ | 55.6 | ||
Total availability under the Partnership's credit facility
|
1,100.0 | 1,100.0 | ||||
Less: Outstanding borrowings under the Partnership's credit facility
|
(140.0 | ) | (498.0 | ) | ||
Less: Outstanding letters of credit outstanding under the Partnership's credit facility
|
(70.2 | ) | (92.5 | ) | ||
Total liquidity
|
$ | 979.3 | $ | 565.1 |
Six Months Ended June 30,
|
||||||||||||
2012
|
2011
|
2012 vs. 2011
|
||||||||||
(In millions)
|
||||||||||||
Net cash provided by (used in):
|
||||||||||||
Operating activities
|
$ | 225.0 | $ | 252.7 | $ | (27.7 | ) | (11% | ) | |||
Investing activities
|
(250.8 | ) | (170.1 | ) | (80.7 | ) | 47% | |||||
Financing activities
|
59.7 | (85.8 | ) | 145.5 | (170% | ) |
Six Months Ended June 30,
|
||||||||||
2012
|
2011
|
2012 vs. 2011
|
||||||||
(in millions)
|
||||||||||
Cash flows from operating activities:
|
||||||||||
Cash received from customers
|
$ | 3,173.0 | $ | 3,324.0 | $ | (151.0 | ) | |||
Cash received from (paid to) derivative counterparties
|
16.6 | (14.9 | ) | 31.5 | ||||||
Cash outlays for:
|
||||||||||
Product purchases
|
(2,704.8 | ) | (2,803.7 | ) | 98.9 | |||||
Operating expenses
|
(142.9 | ) | (132.9 | ) | (10.0 | ) | ||||
General and administrative expenses
|
(76.7 | ) | (75.2 | ) | (1.5 | ) | ||||
Cash distributions from equity investment
|
1.9 | 3.1 | (1.2 | ) | ||||||
Interest paid, net of amounts capitalized (1)
|
(39.4 | ) | (45.3 | ) | 5.9 | |||||
Income taxes paid
|
(2.0 | ) | (2.2 | ) | 0.2 | |||||
Other cash payments
|
(0.7 | ) | (0.2 | ) | (0.5 | ) | ||||
Net cash provided by operating activities
|
$ | 225.0 | $ | 252.7 | $ | (27.7 | ) |
(1)
|
Net of interest paid of $4.5 million and $1.2 million included in investing activities for the six months ended June 30, 2012 and 2011.
|
·
|
On January 23, 2012, we completed a public offering of 4,000,000 common units at a price of $38.30 per common unit. As part of this offering, a wholly-owned subsidiary of Targa purchased 1,300,000 common units. See Note 7, “Partnership Unit and Related Matters.”
|
·
|
On January 31, 2012 we privately placed $400.0 million of 6⅜% Notes. See Note 6, “Debt Obligations.”
|
Distributions
|
|||||||||||||||||
Three Months Ended
|
Date Paid or to be Paid
|
Limited Partners
|
General Partner
|
Distributions per
|
|||||||||||||
Common
|
Incentive
|
2%
|
Total
|
limited partner unit
|
|||||||||||||
(In millions, except per unit amounts)
|
|||||||||||||||||
June 30, 2012
|
August 14, 2012
|
$
|
57.3
|
$
|
14.4
|
$
|
1.5
|
$
|
73.2
|
$
|
0.6425
|
||||||
March 31, 2012
|
May 15, 2012
|
55.5
|
12.7
|
1.4
|
69.6
|
0.6225
|
|||||||||||
December 31, 2011
|
February 14, 2012
|
53.7
|
11.0
|
1.3
|
66.0
|
0.6025
|
Six Months Ended June 30,
|
||||||
2012
|
2011
|
|||||
(In millions)
|
||||||
Gross additions to property, plant and equipment
|
$ | 238.4 | $ | 166.5 | ||
Change in accruals
|
- | (1.8 | ) | |||
Cash expenditures
|
$ | 238.4 | $ | 164.7 |
Six Months Ended June 30,
|
||||||
2012
|
2011
|
|||||
Capital expenditures:
|
(In millions)
|
|||||
Business acquisitions
|
$ | - | $ | 29.0 | ||
Expansion
|
206.5 | 105.1 | ||||
Maintenance
|
31.9 | 32.4 | ||||
$ | 238.4 | $ | 166.5 |
Natural Gas
|
|||||||||||||||
Instrument
|
Price
|
MMBtu per day
|
|||||||||||||
Type
|
Index
|
$/MMBtu
|
2012
|
2013
|
2014
|
2015
|
Fair Value
|
||||||||
(in millions)
|
|||||||||||||||
Swap
|
IF-WAHA
|
6.61
|
14,850
|
-
|
-
|
-
|
$
|
10.1
|
|||||||
Swap
|
IF-WAHA
|
4.68
|
-
|
10,730
|
-
|
-
|
4.6
|
||||||||
Swap
|
IF-WAHA
|
3.53
|
-
|
-
|
7,000
|
-
|
(0.7)
|
||||||||
Swap
|
IF-WAHA
|
3.53
|
-
|
-
|
-
|
1,750
|
(0.3)
|
||||||||
Total Swaps
|
14,850
|
10,730
|
7,000
|
1,750
|
|||||||||||
Swap
|
IF-PB
|
4.98
|
10,200
|
-
|
-
|
-
|
4.0
|
||||||||
Swap
|
IF-PB
|
4.69
|
-
|
10,084
|
-
|
-
|
4.5
|
||||||||
Swap
|
IF-PB
|
3.49
|
-
|
-
|
6,000
|
-
|
(0.7)
|
||||||||
Swap
|
IF-PB
|
3.49
|
-
|
-
|
-
|
1,500
|
(0.3)
|
||||||||
Total Swaps
|
10,200
|
10,084
|
6,000
|
1,500
|
|||||||||||
Swap
|
IF-NGPL MC
|
6.03
|
6,740
|
-
|
-
|
-
|
4.0
|
||||||||
Swap
|
IF-NGPL MC
|
4.17
|
-
|
5,275
|
-
|
-
|
1.4
|
||||||||
Swap
|
IF-NGPL MC
|
3.45
|
-
|
-
|
5,000
|
-
|
(0.6)
|
||||||||
Swap
|
IF-NGPL MC
|
3.46
|
-
|
-
|
-
|
1,250
|
(0.2)
|
||||||||
Total Swaps
|
6,740
|
5,275
|
5,000
|
1,250
|
|||||||||||
Total Sales
|
31,790
|
26,089
|
18,000
|
4,500
|
|||||||||||
Natural Gas Basis Swaps
|
|||||||||||||||
Basis Swaps
|
Various Indexes, Maturities Through December 2012
|
0.7
|
|||||||||||||
$
|
26.5
|
||||||||||||||
NGL
|
||||||||||||||
Instrument
|
Price
|
Barrels per day
|
||||||||||||
Type
|
Index
|
$/Gal
|
2012
|
2013
|
2014
|
Fair Value
|
||||||||
(in millions)
|
||||||||||||||
Swap
|
OPIS-MB
|
0.95
|
9,361
|
-
|
-
|
$
|
15.9
|
|||||||
Swap
|
OPIS-MB
|
1.05
|
-
|
5,650
|
-
|
16.9
|
||||||||
Swap
|
OPIS-MB
|
1.21
|
-
|
-
|
1,000
|
4.8
|
||||||||
Total Swaps
|
9,361
|
5,650
|
1,000
|
|||||||||||
Put (propane)
|
OPIS-MB
|
1.43
|
294
|
-
|
-
|
1.3
|
||||||||
Total Sales
|
9,655
|
5,650
|
1,000
|
|||||||||||
Call (ethane) (1)
|
OPIS-MB
|
0.61
|
2,000
|
-
|
||||||||||
$
|
38.9
|
|||||||||||||
Condensate
|
||||||||||||||
Instrument
|
Price
|
Barrels per day
|
||||||||||||
Type
|
Index
|
$/Bbl
|
2012
|
2013
|
2014
|
Fair Value
|
||||||||
(in millions)
|
||||||||||||||
Swap
|
NY-WTI
|
91.37
|
1,660
|
-
|
-
|
$
|
1.6
|
|||||||
Swap
|
NY-WTI
|
93.34
|
-
|
1,795
|
-
|
3.1
|
||||||||
Swap
|
NY-WTI
|
90.03
|
-
|
-
|
700
|
0.6
|
||||||||
Total Sales
|
1,660
|
1,795
|
700
|
|||||||||||
$
|
5.3
|
(1)
|
Utilized in connection with 2,000 Bbl/d of 2012 ethane swaps providing a floor on ethane with upside.
|
3.1
|
Certificate of Limited Partnership of Targa Resources Partners LP (incorporated by reference to Exhibit 3.2 to Targa Resources Partners LP’s Registration Statement on Form S-1 filed November 16, 2006 (File No. 333-138747)).
|
3.2
|
Certificate of Formation of Targa Resources GP LLC (incorporated by reference to Exhibit 3.3 to Targa Resources Partners LP’s Registration Statement on Form S-1/A filed January 19, 2007 (File No. 333-138747)).
|
3.3
|
Agreement of Limited Partnership of Targa Resources Partners LP (incorporated by reference to Exhibit 3.3 to Targa Resources Partners LP’s Annual Report on Form 10-K filed April 2, 2007 (File No. 001-33303)).
|
3.4
|
First Amended and Restated Agreement of Limited Partnership of Targa Resources Partners LP (incorporated by reference to Exhibit 3.1 to Targa Resources Partners LP’s Current Report on Form 8- K filed February 16, 2007 (File No. 001-33303)).
|
3.5
|
Amendment No. 1, dated May 13, 2008, to the First Amended and Restated Agreement of Limited Partnership of Targa Resources Partners LP (incorporated by reference to Exhibit 3.5 to Targa Resources Partners LP’s Quarterly Report on Form 10-Q filed May 14, 2008 (File No. 001-33303)).
|
3.6
|
Amendment No. 2, dated May 25, 2012, to the First Amended and Restated Agreement of Limited Partnership of Targa Resources Partners LP (incorporated by reference to Exhibit 3.1 to Targa Resources Partners LP’s Current Report on Form 8-K filed May 25, 2012 (File No. 001-33303)).
|
3.7
|
Limited Liability Company Agreement of Targa Resources GP LLC (incorporated by reference to Exhibit 3.4 to Targa Resources Partners LP’s Registration Statement on Form S-1/A filed January 19, 2007 (File No. 333-138747)).
|
4.1*
|
Supplemental Indenture dated April 20, 2012 to Indenture dated June 18, 2008, among Targa Cogen LLC, a subsidiary of Targa Resources Partners LP, Targa Resources Partners Finance Corporation, the other Subsidiary Guarantors and U.S. Bank National Association.
|
4.2*
|
Supplemental Indenture dated April 20, 2012 to Indenture dated August 13, 2010, among Targa Cogen LLC, a subsidiary of Targa Resources Partners LP, Targa Resources Partners Finance Corporation, the other Subsidiary Guarantors and U.S. Bank National Association.
|
4.3*
|
Supplemental Indenture dated April 20, 2012 to Indenture dated February 2, 2011, among Targa Cogen LLC, a subsidiary of Targa Resources Partners LP, Targa Resources Partners Finance Corporation, the other Subsidiary Guarantors and U.S. Bank National Association.
|
4.4*
|
Supplemental Indenture dated April 20, 2012 to Indenture dated January 31, 2012, among Targa Cogen LLC, a subsidiary of Targa Resources Partners LP, Targa Resources Partners Finance Corporation, the other Subsidiary Guarantors and U.S. Bank National Association.
|
31.1*
|
Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
31.2*
|
Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
32.1**
|
Certification of the Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
32.2**
|
Certification of the Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
101.INS**
|
XBRL Instance Document
|
101.SCH**
|
XBRL Taxonomy Extension Schema Document
|
101.CAL**
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
101.DEF**
|
XBRL Taxonomy Extension Definition Linkbase Document
|
101.LAB**
|
XBRL Taxonomy Extension Label Linkbase Document
|
101.PRE**
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
*
|
Filed herewith
|
**
|
Furnished herewith
|
TARGA COGEN LLC
|
|
By:
|
/s/ Matthew J. Meloy
|
Name:
|
Matthew J. Meloy
|
Title:
|
Senior Vice President, Chief Financial Officer and Treasurer
|
TARGA RESOURCES PARTNERS LP
By: Targa Resources GP LLC,
its General Partner
|
|
By:
|
/s/ Matthew J. Meloy
|
Name:
|
Matthew J. Meloy
|
Title:
|
Senior Vice President, Chief Financial Officer and Treasurer
|
TARGA RESOURCES PARTNERS FINANCE CORPORATION
|
|
By:
|
/s/ Matthew J. Meloy
|
Name:
|
Matthew J. Meloy
|
Title:
|
Senior Vice President, Chief Financial Officer and Treasurer
|
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
|
|
By:
|
/s/ Steven A. Finklea
|
Authorized Signatory
|
TARGA COGEN LLC
|
|
By:
|
/s/ Matthew J. Meloy
|
Name:
|
Matthew J. Meloy
|
Title:
|
Senior Vice President, Chief Financial Officer and Treasurer
|
TARGA RESOURCES PARTNERS LP
By: Targa Resources GP LLC,
its General Partner
|
|
By:
|
/s/ Matthew J. Meloy
|
Name:
|
Matthew J. Meloy
|
Title:
|
Senior Vice President, Chief Financial Officer and Treasurer
|
TARGA RESOURCES PARTNERS FINANCE CORPORATION
|
|
By:
|
/s/ Matthew J. Meloy
|
Name:
|
Matthew J. Meloy
|
Title:
|
Senior Vice President, Chief Financial Officer and Treasurer
|
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
|
|
By:
|
/s/ Steven A. Finklea
|
Authorized Signatory
|
TARGA COGEN LLC
|
|
By:
|
/s/ Matthew J. Meloy
|
Name:
|
Matthew J. Meloy
|
Title:
|
Senior Vice President, Chief Financial Officer and Treasurer
|
TARGA RESOURCES PARTNERS LP
By: Targa Resources GP LLC,
its General Partner
|
|
By:
|
/s/ Matthew J. Meloy
|
Name:
|
Matthew J. Meloy
|
Title:
|
Senior Vice President, Chief Financial Officer and Treasurer
|
TARGA RESOURCES PARTNERS FINANCE CORPORATION
|
|
By:
|
/s/ Matthew J. Meloy
|
Name:
|
Matthew J. Meloy
|
Title:
|
Senior Vice President, Chief Financial Officer and Treasurer
|
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
|
|
By:
|
/s/ Steven A. Finklea
|
Authorized Signatory
|
TARGA COGEN LLC
|
|
By:
|
/s/ Matthew J. Meloy
|
Name:
|
Matthew J. Meloy
|
Title:
|
Senior Vice President, Chief Financial Officer and Treasurer
|
TARGA RESOURCES PARTNERS LP
By: Targa Resources GP LLC,
its General Partner
|
|
By:
|
/s/ Matthew J. Meloy
|
Name:
|
Matthew J. Meloy
|
Title:
|
Senior Vice President, Chief Financial Officer and Treasurer
|
TARGA RESOURCES PARTNERS FINANCE CORPORATION
|
|
By:
|
/s/ Matthew J. Meloy
|
Name:
|
Matthew J. Meloy
|
Title:
|
Senior Vice President, Chief Financial Officer and Treasurer
|
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
|
|
By:
|
/s/ Steven A. Finklea
|
Authorized Signatory
|
)S'ANH^1J
Segment Information, Revenues by Product and Service and Reconciliation of Operating Margin to Net Income (Details) (USD $)
In Millions, unless otherwise specified |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2012
|
Jun. 30, 2011
|
Jun. 30, 2012
|
Jun. 30, 2011
|
|
Revenue from External Customer [Line Items] | ||||
Revenues | $ 1,318.4 | $ 1,726.0 | $ 2,963.9 | $ 3,341.1 |
Reconciliation of operating margin to net income | ||||
Operating margin | 166.6 | 176.6 | 356.4 | 324.5 |
Depreciation and amortization expense | (47.6) | (44.5) | (94.3) | (87.2) |
General and administrative expense | (33.5) | (33.2) | (66.4) | (64.9) |
Interest expense, net | (29.4) | (27.2) | (58.8) | (54.6) |
Total income tax benefit (expense) | (0.8) | (1.9) | (1.8) | (3.7) |
Other, net | (0.6) | (1.8) | 1.5 | (0.3) |
Net income | 54.7 | 68.0 | 136.6 | 113.8 |
Natural gas sales [Member]
|
||||
Revenue from External Customer [Line Items] | ||||
Revenues | 188.0 | 292.9 | 390.7 | 541.7 |
NGL sales [Member]
|
||||
Revenue from External Customer [Line Items] | ||||
Revenues | 950.7 | 1,344.0 | 2,240.9 | 2,645.7 |
Condensate sales [Member]
|
||||
Revenue from External Customer [Line Items] | ||||
Revenues | 29.0 | 33.1 | 58.0 | 54.6 |
Fractionating and treating fees [Member]
|
||||
Revenue from External Customer [Line Items] | ||||
Revenues | 28.6 | 23.3 | 55.5 | 34.4 |
Storage and terminaling fees [Member]
|
||||
Revenue from External Customer [Line Items] | ||||
Revenues | 35.4 | 24.8 | 65.8 | 49.4 |
Gas processing fees [Member]
|
||||
Revenue from External Customer [Line Items] | ||||
Revenues | 9.8 | 7.7 | 18.3 | 14.8 |
Hedge settlements [Member]
|
||||
Revenue from External Customer [Line Items] | ||||
Revenues | 12.1 | (13.0) | 14.0 | (18.2) |
Other product and service revenue [Member]
|
||||
Revenue from External Customer [Line Items] | ||||
Revenues | 10.5 | 13.2 | 20.9 | 18.7 |
Petroleum Products [Member]
|
||||
Revenue from External Customer [Line Items] | ||||
Revenues | $ 54.3 | $ 99.8 |
Derivative Instruments and Hedging Activities (Tables)
|
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2012
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Notional volume of commodity hedges | At June 30, 2012, the notional volumes of our commodity hedges for our equity volumes were:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair values of derivative instruments |
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of gain (loss) on financial instruments |
Hedge ineffectiveness was immaterial for all periods presented. Our consolidated earnings are also affected by the use of the mark-to-market method of accounting for derivative instruments that do not qualify for hedge accounting or that have not been designated as hedges. The changes in fair value of these instruments are recorded on the balance sheet and through earnings (i.e., using the "mark-to-market" method) rather than being deferred until the anticipated transaction settles. The use of mark-to-market accounting for financial instruments can cause non-cash earnings volatility due to changes in the underlying commodity price indices. We recorded the following mark-to-market gains (losses) for the periods indicated:
The following table shows the deferred gains (losses) included in accumulated OCI that will be reclassified into earnings through the end of 2015:
|
Commitments and Contingencies (Details) (USD $)
In Millions, unless otherwise specified |
6 Months Ended |
---|---|
Jun. 30, 2012
|
|
Environmental | |
Amount paid on settlement for current period | $ 0.9 |
Amount paid on settlement to date | $ 16.6 |
Basis of Presentation
|
6 Months Ended |
---|---|
Jun. 30, 2012
|
|
Basis of Presentation [Abstract] | |
Basis of Presentation | Note 2 - Basis of Presentation We have prepared these unaudited consolidated financial statements in accordance with GAAP for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. While we derived the year-end balance sheet data from audited financial statements, this interim report does not include all disclosures required by GAAP for annual periods. These unaudited consolidated financial statements and other information included in this Quarterly Report should be read in conjunction with our consolidated financial statements and notes thereto included in our Annual Report. The unaudited consolidated financial statements for the three and six months ended June 30, 2012 and 2011 include all adjustments which we believe are necessary for a fair presentation of the results for interim periods. All significant intercompany balances and transactions have been eliminated in consolidation. Certain amounts in prior periods have been reclassified to conform to the current year presentation. Our financial results for the three and six months ended June 30, 2012 are not necessarily indicative of the results that may be expected for the full year ending December 31, 2012. |