10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2020

or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                      to                     

Commission file number: 001-38260

BP Midstream Partners LP

(Exact name of registrant as specified in its charter)

Delaware	82-1646447
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

501 Westlake Park Boulevard, Houston, Texas 77079

(Address of principal executive offices) (Zip Code)

(281) 366-2000

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol	Name of each exchange on which registered
Common Units, Representing Limited Partner Interests	BPMP	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒    No  ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  ☒    No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes  ☐    No  ☒

As of August 5, 2020, the registrant had 52,402,967 common units and 52,375,535 subordinated units outstanding.

BP MIDSTREAM PARTNERS LP

TABLE OF CONTENTS

Item	Page
PART I - Financial Information	3
1. Financial Statements (Unaudited)	3
Condensed Consolidated Balance Sheets	3
Condensed Consolidated Statements of Operations	4
Condensed Consolidated Statements of Changes in Equity	5
Condensed Consolidated Statements of Cash Flows	6
Notes to Condensed Consolidated Financial Statements (Unaudited)	7
2. Management's Discussion and Analysis of Financial Condition and Results of Operations	20
3. Quantitative and Qualitative Disclosures about Market Risk	33
4. Controls and Procedures	33
PART II - Other Information
1. Legal Proceedings	34
1A. Risk Factors	34
5. Other Information	35
6. Exhibits	36
Signature	37

PART I - FINANCIAL INFORMATION

Item 1. FINANCIAL STATEMENTS (UNAUDITED)

BP MIDSTREAM PARTNERS LP

CONDENSED CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

	June 30, 2020		December 31, 2019
	(in millions of dollars)
ASSETS
Current assets
Cash and cash equivalents	$	114.9	$	98.8
Accounts receivable – third parties	0.2		0.6
Accounts receivable – related parties	10.7		11.3
Prepaid expenses	2.0		5.1
Other current assets	5.6		5.0
Total current assets	133.4		120.8
Equity method investments (Note 3)	526.5		534.4
Property, plant and equipment, net (Note 4)	62.9		62.7
Other assets	3.6		4.2
Total assets	$	726.4	$	722.1
LIABILITIES
Current liabilities
Accounts payable – third parties	$	0.8	$	0.6
Accounts payable – related parties	1.4		1.7
Deferred revenue and credits	1.6		1.5
Other current liabilities (Note 5)	5.2		6.6
Total current liabilities	9.0		10.4
Long-term debt (Note 6)	468.0		468.0
Other liabilities	3.6		3.5
Total liabilities	480.6		481.9
Commitments and contingencies (Note 10)
EQUITY
Common unitholders – public (2020 – 47,821,790 issued and outstanding; 2019 – 47,806,563 units issued and outstanding)	855.0		851.6
Common unitholders – BP Holdco (2020 and 2019 – 4,581,177 units issued and outstanding)	(60.0)		(60.3)
Subordinated unitholders – BP Holdco (2020 and 2019 – 52,375,535 units issued and outstanding)	(685.7)		(689.2)
General partner	1.2		1.2
Total partners' capital	110.5		103.3
Non-controlling interests	135.3		136.9
Total equity	245.8		240.2
Total liabilities and equity	$	726.4	$	722.1

The accompanying notes are an integral part of the unaudited condensed consolidated financial statements.

3

BP MIDSTREAM PARTNERS LP

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(UNAUDITED)

	Three Months Ended June 30,				Six Months Ended June 30,
	2020		2019		2020		2019
	(in millions of dollars, unless otherwise indicated)
Revenue
Third parties	$	0.8	$	0.7	$	1.8	$	1.5
Related parties	30.7		27.9		60.4		57.3
Total revenue	31.5		28.6		62.2		58.8
Costs and expenses
Operating expenses – third parties	3.1		3.4		6.8		6.7
Operating expenses – related parties	1.3		1.4		2.8		2.9
Maintenance expenses – third parties	1.4		0.6		1.6		0.9
Maintenance expenses – related parties	0.1		0.1		0.2		0.1
General and administrative – third parties	0.7		0.4		1.6		1.4
General and administrative – related parties	3.6		3.7		7.5		7.1
Depreciation	0.6		0.7		1.3		1.3
Impairment and other, net	—		1.0		—		1.0
Property and other taxes	0.2		0.2		0.3		0.3
Total costs and expenses	11.0		11.5		22.1		21.7
Operating income	20.5		17.1		40.1		37.1
Income from equity method investments	26.8		28.8		58.1		53.2
Interest expense, net	1.9		3.8		5.3		7.5
Net income	45.4		42.1		92.9		82.8
Less: Net income attributable to non-controlling interests	4.8		4.8		10.6		8.3
Net income attributable to the Partnership	$	40.6	$	37.3	$	82.3	$	74.5
Net income attributable to the Partnership per limited partner unit – basic and diluted (in dollars):
Common units	$	0.38	$	0.35	$	0.77	$	0.70
Subordinated units	$	0.38	$	0.35	$	0.77	$	0.70
Weighted average number of limited partner units outstanding - basic and diluted (in millions):
Common units – public	47.8		47.8		47.8		47.8
Common units – BP Holdco	4.6		4.6		4.6		4.6
Subordinated units – BP Holdco	52.4		52.4		52.4		52.4

The accompanying notes are an integral part of the unaudited condensed consolidated financial statements.

4

BP MIDSTREAM PARTNERS LP

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(UNAUDITED)

		Six Month Period Ended June 30, 2020
		Partners' Capital
(in millions of dollars)		Common Unitholders – Public		Common Unitholders – BP Holdco		Subordinated Unitholders – BP Holdco		General Partner		Non-controlling Interests		Total
Balance at December 31, 2019		$	851.6	$	(60.3)	$	(689.2)	$	1.2	$	136.9	$	240.2
	Net income	18.5		1.8		20.2		1.2		5.8		47.5
	Distributions to unitholders ($0.3475 per unit) and general partner	(16.6)		(1.6)		(18.2)		(1.2)		—		(37.6)
	Unit-based compensation	0.1		—		—		—		—		0.1
	Distributions to non-controlling interests	—		—		—		—		(6.7)		(6.7)
Balance at March 31, 2020		853.6		(60.1)		(687.2)		1.2		136.0		243.5
	Net income	18.0		1.7		19.7		1.2		4.8		45.4
	Distributions to unitholders ($0.3475 per unit) and general partner	(16.6)		(1.6)		(18.2)		(1.2)		—		(37.6)
	Unit-based compensation	—		—		—		—		—		—
	Distributions to non-controlling interests	—		—		—		—		(5.5)		(5.5)
Balance at June 30, 2020		$	855.0	$	(60.0)	$	(685.7)	$	1.2	$	135.3	$	245.8

		Six Month Period Ended June 30, 2019
		Partners' Capital
(in millions of dollars)		Common Unitholders – Public		Common Unitholders – BP Holdco		Subordinated Unitholders – BP Holdco		General Partner		Non-controlling Interests		Total
Balance at December 31, 2018		$	836.8	$	(61.7)	$	(705.2)	$	—	$	141.0	$	210.9
	Net income	16.9		1.6		18.5		0.2		3.5		40.7
	Distributions to unitholders ($0.3015 per unit) and general partner	(14.4)		(1.4)		(15.8)		—		—		(31.6)
	Distributions to non-controlling interests	—		—		—		—		(4.6)		(4.6)
Balance at March 31, 2019		839.3		(61.5)		(702.5)		0.2		139.9		215.4
	Net income	16.9		1.6		18.4		0.4		4.8		42.1
	Distributions to unitholders ($0.3126 per unit) and general partner	(15.0)		(1.4)		(16.4)		(0.2)		—		(33.0)
	Unit-based compensation	0.1		—		—		—		—		0.1
	Distributions to non-controlling interests	—		—		—		—		(6.0)		(6.0)
Balance at June 30, 2019		$	841.3	$	(61.3)	$	(700.5)	$	0.4	$	138.7	$	218.6

The accompanying notes are an integral part of the unaudited condensed consolidated financial statements.

5

BP MIDSTREAM PARTNERS LP

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS 

(UNAUDITED)

	Six Months Ended June 30,
	2020		2019
	(in millions of dollars)
Cash flows from operating activities
Net income	$	92.9	$	82.8
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation	1.3		1.3
Impairment and other, net	—		1.0
Non-cash expenses	0.1		0.1
Income from equity method investments	(58.1)		(53.2)
Distributions of earnings received from equity method investments	60.7		55.7
Changes in operating assets and liabilities
Accounts receivable	1.0		(0.6)
Prepaid expenses and other current assets	3.1		2.6
Accounts payable	(0.1)		(1.0)
Deferred revenue and credits	0.1		2.6
Other	(1.5)		(4.0)
Net cash provided by operating activities	99.5		87.3
Cash flows from investing activities
Capital expenditures	(1.3)		(0.3)
Distributions in excess of earnings from equity method investments	5.3		6.6
Net cash provided by investing activities	4.0		6.3
Cash flows from financing activities
Proceeds from issuance of term loan	468.0		—
Repayment of credit facility	(468.0)		—
Distributions to unitholders and general partner	(75.2)		(64.6)
Distributions to non-controlling interests	(12.2)		(10.6)
Net cash used in financing activities	(87.4)		(75.2)
Net change in cash and cash equivalents	16.1		18.4
Cash and cash equivalents at beginning of the period	98.8		57.0
Cash and cash equivalents at end of the period	$	114.9	$	75.4
Supplemental cash flow information
Cash paid for interest	8.3		12.1
Non-cash investing transactions
Accrued capital expenditures	0.5		0.2

The accompanying notes are an integral part of the unaudited condensed consolidated financial statements.

6

BP MIDSTREAM PARTNERS LP  

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

(in millions of dollars, unless otherwise indicated)

1. Business and Basis of Presentation

BP Midstream Partners LP (either individually or together with its subsidiaries, as the context requires, the “Partnership”) is a Delaware limited partnership formed on May 22, 2017 by BP Pipelines (North America) Inc. (“BP Pipelines”), an indirect wholly owned subsidiary of BP p.l.c. (“BP”), a “foreign private issuer” within the meaning of the Securities Exchange Act of 1934, as amended.

Unless otherwise stated or the context otherwise indicates, all references to “we,” “our,” “us,” or similar expressions refer to the legal entity BP Midstream Partners LP. The term “our Parent” refers to BP Pipelines; any entity that wholly owns BP Pipelines, indirectly or directly, including BP and BP America Inc. (“BPA”), an indirect wholly owned subsidiary of BP; and any entity that is wholly owned by the aforementioned entities, excluding BP Midstream Partners LP.

Business

BP Midstream Partners LP is a master limited partnership formed by BP Pipelines to own, operate, develop and acquire pipelines and other midstream assets. The Partnership's assets consist of interests in entities that own crude oil, natural gas, refined products and diluent pipelines and refined product terminals serving as key infrastructure for BP and other customers to transport onshore crude oil production to BP’s refinery in Whiting, Indiana (the “Whiting Refinery”) and offshore crude oil and natural gas production to key refining markets and trading and distribution hubs. Certain assets deliver refined products and diluent from the Whiting Refinery and other U.S. supply hubs to major demand centers.

As of June 30, 2020, the Partnership's assets consisted of the following:

•BP Two Pipeline Company LLC, which owns the BP#2 crude oil pipeline system (“BP2”).

•BP River Rouge Pipeline Company LLC, which owns the Whiting to River Rouge refined products pipeline system (“River Rouge”).

•BP D-B Pipeline Company LLC, which owns the Diamondback diluent pipeline system (“Diamondback”). BP2, River Rouge, and Diamondback, together, are referred to as the "Wholly Owned Assets".

•28.5% ownership interest in Mars Oil Pipeline Company, LLC (“Mars”), which owns a major corridor crude oil pipeline system in the Gulf of Mexico. 

•65% ownership interest and 100% managing member interest in Mardi Gras Transportation System Company, LLC ("Mardi Gras"), which holds the following investments in joint ventures located in the Gulf of Mexico:

•56% ownership interest in Caesar Oil Pipeline Company, LLC (“Caesar”),

•53% ownership interest in Cleopatra Gas Gathering Company, LLC (“Cleopatra”),

•65% ownership interest in Proteus Oil Pipeline Company, LLC (“Proteus”), and,

•65% ownership interest in Endymion Oil Pipeline Company, LLC (“Endymion”).

•Together Endymion, Caesar, Cleopatra and Proteus are referred to as the “Mardi Gras Joint Ventures.”

•22.7% ownership interest in Ursa Oil Pipeline Company, LLC ("Ursa").

•25% ownership interest in KM Phoenix Holdings, LLC ("KM Phoenix").

We generate a majority of revenue by charging fees for the transportation of crude oil, refined products and diluent through our pipelines under agreements with minimum volume commitments ("MVC"). We do not engage in the marketing and trading of any commodities. All operations are conducted in the United States, and all long-lived assets are located in the United States. Partnership operations consist of one reportable segment.

Certain Partnership businesses are subject to regulation by various authorities including, but not limited to the Federal Energy Regulatory Commission ("FERC"). Regulatory bodies exercise statutory authority over matters such as common carrier tariffs, construction, rates and ratemaking and agreements with customers.

Basis of Presentation

Condensed consolidated financial statements have been prepared under the rules and regulations of the Securities and Exchange Commission (“SEC”). These rules and regulations conform to the accounting principles contained in the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification, the single source of accounting principles generally accepted in the United States (“GAAP”).

7

BP MIDSTREAM PARTNERS LP  

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

(in millions of dollars, unless otherwise indicated)

Certain information and footnote disclosures normally included in the annual consolidated financial statements have been condensed or omitted from these condensed consolidated financial statements. The condensed consolidated financial statements as of June 30, 2020, and for the three and six months ended June 30, 2020 and 2019, included herein, are unaudited. These financial statements include all known accruals and adjustments necessary, in the opinion of management, for a fair presentation of our condensed consolidated financial position, results of operations and cash flows. Unless otherwise specified, all such adjustments are of a normal and recurring nature. The unaudited results of operations for the interim periods reported are not necessarily indicative of results to be expected for the full year. These unaudited condensed consolidated financial statements should be read in conjunction with our audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2019 (the "Partnership's 2019 10-K").

Partnership financial position, results of operations and cash flows consist of consolidated BP Midstream Partners LP activities and balances. All intercompany accounts and transactions within the financial statements have been eliminated for all periods presented.

Summary of Significant Accounting Policies

There have been no significant changes to accounting policies as disclosed in Note 2 - Summary of Significant Accounting Policies in the Partnership's 2019 10-K.

2. Revenue Recognition

We recognize revenue over time or at a point in time, depending on the nature of the performance obligations contained in the respective contract with customers. A performance obligation is our unit of account and it represents a promise in a contract to transfer goods or services to the customer. The contract transaction price, which is the amount of consideration to which an entity expects to be entitled in exchange for transferring promised goods or services to a customer, is allocated to each performance obligation and recognized as revenue when or as the performance obligation is satisfied. The following is an overview of our significant revenue stream, including a description of the respective performance obligations and related methods of revenue recognition.

Pipeline Transportation

Revenue from pipeline transportation is comprised of tariffs and fees associated with the transportation of liquid petroleum products, generally at published tariffs and in certain instances, revenue from MVC contracts at negotiated rates. Tariff revenue is recognized either at the point of delivery or at the point of receipt, pursuant to specifications outlined in the respective tariffs. We record revenue for crude oil, refined products and diluent transportation during the period in which they are earned (i.e., either physical delivery of product has taken place or the services designated in the contract have been performed). Partnership services are typically billed on a monthly basis, and we generally do not offer extended payment terms. We accrue revenue based on services rendered but not billed for that accounting month.

Billings to BP Products for deficiency volumes under its MVCs, if any, are recorded as deferred revenue and credits, a contract liability, on the condensed consolidated balance sheets, as BP Products has the right to make up the deficiency volumes within the measurement period specified by the agreements. Deferred revenue under these arrangements is recognized into revenue once it is deemed remote that the customer will meet its required annual MVC. If the customer does satisfy its minimum volume commitment by shipping the deficiency volumes within the same calendar year, it may receive a refund of excess payments.

We recognized $6.0 million of deficiency revenue under the throughput and deficiency agreements with BP Products for the three and six months ended June 30, 2020. We recognized no deficiency revenue for the three and six months ended June 30, 2019.

Allowance Oil

The tariff for crude oil transportation at BP2 includes a fixed loss allowance (“FLA”). An FLA factor per barrel, a fixed percentage, is a separate fee that is considered a part of the transaction price under the applicable crude oil tariff to cover evaporation and other losses in transit. The amount of revenue recognized is a product of the quantity transported, the applicable FLA factor and the settlement price during the month the product is transported.

8

BP MIDSTREAM PARTNERS LP  

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

(in millions of dollars, unless otherwise indicated)

We recognized revenue of $0.8 million and $2.3 million in the three and six months ended June 30, 2020, respectively, related to the FLA arrangements with our Parent. In the three and six months ended June 30, 2019, we recognized revenue of $2.6 million and $5.1 million, respectively, related to FLA arrangements with our Parent.

Disaggregation of Revenue

The following table provides information about disaggregated revenue:

	Three Months Ended June 30,				Six Months Ended June 30,
	2020		2019		2020		2019
Transportation services revenue - third parties	$	0.8	$	0.7	$	1.8	$	1.5
Transportation services revenue - related parties	30.7		27.9		60.4		57.3
Total revenue	$	31.5	$	28.6	$	62.2	$	58.8

Future Performance Obligations

The fixed portion of existing customer contracts are summarized in the future performance obligations as of June 30, 2020. The unfulfilled performance obligations included in the table below are expected to be recognized in revenue in the specified periods:

	As of June 30, 2020
Remainder of 2020	$	63.9
2021	1.7
Total	$	65.6

Contract Balances

Contract assets and contract liabilities are the result of timing differences between revenue recognition, billings and cash collections. Contract liabilities or deferred revenue and credits primarily relate to consideration received from customers for temporary deficiency quantities under minimum volume contracts that the customer has the right to make up in a future period, which we subsequently recognize as revenue or amounts we credit back to the customer in a future period.

The following table provides information about receivables from contracts with customers, contract assets and contract liabilities:

	June 30, 2020		December 31, 2019
Receivables from contracts with customers - third parties	$	0.2	$	0.6
Receivables from contracts with customers - related parties	10.7		11.3
Deferred revenue and credits - related parties	1.6		1.5

3. Equity Method Investments

We account for ownership interests in Mars, the Mardi Gras Joint Ventures, Ursa, and KM Phoenix using the equity method for financial reporting purposes. Financial results include the Partnership's proportionate share of Mars, the Mardi Gras Joint Ventures, Ursa and KM Phoenix, which is reflected in Income from equity method investments on the condensed consolidated statements of operations. We did not record any impairment loss on equity method investments during the three and six months ended June 30, 2020 and 2019.

9

BP MIDSTREAM PARTNERS LP  

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

(in millions of dollars, unless otherwise indicated)

The table below summarizes the balances and activities related for each equity method investment ("EMI") recorded as of and for the three and six months ended June 30, 2020 and 2019:

	Three Months Ended June 30, 2020							Three Months Ended June 30, 2019
	Percentage Ownership	Distributions Received		Income from EMI		Carrying Value		Percentage Ownership	Distributions Received		Income from EMI		Carrying Value
Mars	28.5%	$	(13.7)	$	11.6	$	54.3	28.5%	$	(13.7)	$	11.9	$	57.0
Caesar	56.0%	(3.4)		3.7		117.3		56.0%	(4.3)		4.5		119.5
Cleopatra	53.0%	(2.4)		1.2		115.5		53.0%	(3.2)		2.6		118.3
Proteus	65.0%	(5.2)		3.6		72.3		65.0%	(5.2)		3.3		77.7
Endymion	65.0%	(4.8)		5.2		81.5		65.0%	(4.5)		3.5		80.8
Others(1)	Various	(2.3)		1.5		85.6		Various	(2.9)		3.0		86.6
Total Equity Investments		$	(31.8)	$	26.8	$	526.5		$	(33.8)	$	28.8	$	539.9

	Six Months Ended June 30, 2020							Six Months Ended June 30, 2019
	Percentage Ownership	Distributions Received		Income from EMI		Carrying Value		Percentage Ownership	Distributions Received		Income from EMI		Carrying Value
Mars	28.5%	$	(26.7)	$	24.1	$	54.3	28.5%	$	(25.8)	$	23.7	$	57.0
Caesar	56.0%	(8.3)		8.2		117.3		56.0%	(9.7)		9.8		119.5
Cleopatra	53.0%	(5.3)		3.2		115.5		53.0%	(6.6)		5.4		118.3
Proteus	65.0%	(10.7)		7.7		72.3		65.0%	(7.5)		3.9		77.7
Endymion	65.0%	(10.7)		11.2		81.5		65.0%	(6.5)		4.7		80.8
Others(1)	Various	(4.3)		3.7		85.6		Various	(6.2)		5.7		86.6
Total Equity Investments		$	(66.0)	$	58.1	$	526.5		$	(62.3)	$	53.2	$	539.9

⁽¹⁾ Includes ownership in Ursa (22.7%) and KM Phoenix (25%).

The following table presents aggregated selected income statement data for equity method investments on a 100% basis for the three and six months ended June 30, 2020 and 2019:

	Three Months Ended June 30,
	2020		2019
Statement of operations
Revenue	$	127.0	$	148.1
Operating expenses	57.1		71.2
Net income	70.0		78.1

	Six Months Ended June 30,
	2020		2019
Statement of operations
Revenue	$	271.6	$	264.1
Operating expenses	121.4		117.0
Net income	150.5		148.4

10

BP MIDSTREAM PARTNERS LP  

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

(in millions of dollars, unless otherwise indicated)

4. Property, Plant and Equipment

Property, plant and equipment consisted of the following:

	June 30, 2020		December 31, 2019
Land	$	0.2	$	0.2
Right-of-way assets	1.4		1.4
Buildings and improvements	6.9		6.9
Pipelines and equipment	94.6		94.4
Other	0.5		0.5
Construction in progress	1.9		0.6
Property, plant and equipment	105.5		104.0
Less: Accumulated depreciation	(42.6)		(41.3)
Property, plant and equipment, net	$	62.9	$	62.7

There were no impairments on property, plant and equipment for the three and six months ended June 30, 2020. During the three and six months ended June 30, 2019, an impairment charge of $2.3 million was recorded under "Impairment and other, net" on our condensed consolidated statements of operations. See Note 10 - Commitments and Contingencies.

5. Other Current Liabilities

Other current liabilities consisted of the following:

	June 30, 2020		December 31, 2019
Current portion of environmental remediation obligation	$	0.4	$	0.6
Current portion of lease liabilities	0.1		0.1
Accrued interest payable - related parties	1.6		4.2
Accrued liabilities	3.1		1.7
Other current liabilities	$	5.2	$	6.6

6. Debt

On February 24, 2020, we entered into a $468 million Term Loan Facility Agreement ("term loan") with an affiliate of BP. On March 13, 2020, proceeds were used to repay outstanding borrowings under the existing credit facility. Please refer to Note 9 - Debt in the Partnership's 2019 10-K for further details. The term loan has a final repayment date of February 24, 2025, and provides for certain covenants, including the requirement to maintain a consolidated leverage ratio, which is calculated as total indebtedness to consolidated EBITDA, not to exceed 5.0 to 1.0, subject to a temporary increase in such ratio to 5.5 to 1.0 in connection with certain material acquisitions. Simultaneous with this transaction, we entered into the First Amendment to Short Term Credit Facility Agreement (the "First Amendment") whereby the lender added a provision that indebtedness under both the term loan and the credit facility shall not exceed $600 million. All other terms of the credit facility remain the same. As of June 30, 2020, the Partnership was in compliance with the covenants contained in the term loan facility and the credit facility.

There were $468 million of outstanding borrowings under the term loan at June 30, 2020, and $468 million under the credit facility at December 31, 2019. Interest charges and fees were $2.0 million and $5.6 million for the three and six months ended June 30, 2020, respectively. Interest charges and fees related to the credit facility were $4.1 million and $8.2 million for the three and six months ended June 30, 2019, respectively.

Indebtedness under the term loan bears interest at the 3-month LIBOR plus 0.73%. For the three and six months ended June 30, 2020, the weighted average interest rate for the term loan and the credit facility was 1.69% and 2.28%, respectively.

For the year ended December 31, 2019, the weighted average interest rate for the credit facility was 3.25%. The credit facility includes customary fees, including a commitment fee of 0.10% and a utilization fee of 0.20% per annum.

11

BP MIDSTREAM PARTNERS LP  

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

(in millions of dollars, unless otherwise indicated)

7. Related Party Transactions

Related party transactions include transactions with our Parent and its affiliates, including those entities in which our Parent has an ownership interest but over which it does not have control. In addition to the MVC and FLA arrangements discussed in Note 2 - Revenue Recognition and the credit facility and term loan in Note 6 - Debt, we have entered into the following transactions with related parties:

Omnibus Agreement

The Partnership has entered into an omnibus agreement with BP Pipelines and certain of its affiliates, including BP Midstream Partners GP LLC (our "General Partner"). This agreement addresses, among other things, (i) the Partnership's obligation to pay an annual fee for general and administrative services provided by BP Pipelines and its affiliates, (ii) the Partnership's obligation to reimburse BP Pipelines for personnel and other costs related to the direct operation, management and maintenance of the assets and (iii) the Partnership's obligation to reimburse BP Pipelines for services and certain direct or allocated costs and expenses incurred by BP Pipelines or its affiliates on behalf of the Partnership.

BP Pipelines will indemnify us for all known and certain unknown environmental liabilities that are associated with the ownership or operation of Partnership assets and due to occurrences on or before October 30, 2017, subject to certain limitations. Indemnification for any unknown environmental liabilities will be limited to liabilities due to occurrences on or before October 30, 2017, which are identified prior to October 30, 2020.

Further, the omnibus agreement addresses the granting of a license from BPA to the Partnership with respect to use of certain BP trademarks and trade name.

Related Party Revenue  

We provide crude oil, refined products and diluent transportation services to related parties and generate revenue through published tariffs. We have commercial arrangements with BP Products that include MVCs. See Note 10 - Related Party Transactions in the Partnership's 2019 10-K for further discussion regarding these agreements.

Revenue from related parties was $30.7 million and $60.4 million for the three and six months ended June 30, 2020, respectively, and $27.9 million and $57.3 million for the three and six months ended June 30, 2019, respectively.

We recognized $6.0 million of deficiency revenue under the throughput and deficiency agreements with BP Products for the three and six months ended June 30, 2020. We recognized no deficiency revenue for the three and six months ended June 30, 2019. The Partnership recorded $1.6 million and $1.5 million in Deferred revenue and credits on the condensed consolidated balance sheets at June 30, 2020 and December 31, 2019, respectively.

Related Party Expenses

All employees performing services on behalf of Partnership operations are employees of our Parent. Our Parent also procures insurance policies on our behalf and performs certain general corporate functions for us related to finance, accounting, treasury, legal, information technology, human resources, shared services, government affairs, insurance, health, safety, security, employee benefits, incentives, severance and environmental functional support. Personnel and operating costs incurred by our Parent on our behalf are included in either Operating expenses – related parties or General and administrative – related parties in the condensed consolidated statements of operations, depending on the nature of the service provided.

We paid our Parent an annual fee of $13.6 million in 2019 in the form of monthly installments under the omnibus agreement for general and administrative services provided by our Parent and its affiliates. The annual fee was adjusted to $15.2 million per year, payable in equal monthly installments, beginning on January 1, 2020. During the second quarter of 2020, our Parent agreed to adjust the fee payable under the Omnibus Agreement back to the 2019 annual fee, beginning in the second quarter, pro rated for the remainder of 2020 due to the ongoing economic effects of the global COVID-19 pandemic. A new fee will be in place for 2021. We also reimburse our Parent for personnel and other costs related to the direct operation, management and maintenance of the assets and services and certain direct or allocated costs and expenses incurred by our Parent or its affiliates on our behalf pursuant to the terms in the omnibus agreement.

12

BP MIDSTREAM PARTNERS LP  

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

(in millions of dollars, unless otherwise indicated)

For the three and six months ended June 30, 2020 and 2019, we recorded the following amounts for related party expenses, which also included the expenses related to share-based compensation discussed below:

	Three Months Ended June 30,				Six Months Ended June 30,
	2020		2019		2020		2019
Operating expenses—related parties	$	1.3	$	1.4	$	2.8	$	2.9
Maintenance expenses—related parties	0.1		0.1		0.2		0.1
General and administrative—related parties	3.6		3.7		7.5		7.1
Total costs and expenses—related parties	$	5.0	$	5.2	$	10.5	$	10.1

Share-based Compensation

Our Parent operates share option plans and equity-settled employee share plans. These plans typically have a three-year performance or restricted period during which the units accrue net notional dividends, which are treated as having been reinvested. Leaving employment will normally preclude the conversion of units into shares, but special arrangements apply for participants that leave for qualifying reasons.

Share-based compensation related to the employees of our Parent who provide services to us is charged to the Partnership pursuant to the terms of the omnibus agreement. The Partnership also issued its own unit-based compensation under a long-term incentive plan. See Note 11 - Unit-Based Compensation.

Non-controlling Interests

Non-controlling interests consist of the 35% ownership interest in Mardi Gras held by our Parent at June 30, 2020 and 2019. Net income attributable to non-controlling interests is the product of the non-controlling interests ownership percentage and the net income of Mardi Gras. We report Non-controlling interests as a separate component of equity on the condensed consolidated balance sheets and Net income attributable to non-controlling interests on the condensed consolidated statements of operations.

8. Net Income Per Limited Partner Unit

The following table details the distributions declared and/or paid for the periods presented:

Three Months Ended	Date Paid or to be Paid	General Partner		Limited Partners' Common Units		Limited Partners' Subordinated Units		Total		Distributions per Limited Partner Unit (in dollars)
December 31, 2018	February 14, 2019	$	—	$	15.8	$	15.8	$	31.6	$	0.3015
March 31, 2019	May 15, 2019	0.2		16.4		16.4		33.0		0.3126
June 30, 2019	August 14, 2019	0.4		17.0		17.0		34.4		0.3237
December 31, 2019	February 13, 2020	1.2		18.2		18.2		37.6		0.3475
March 31, 2020	May 14, 2020	1.2		18.2		18.2		37.6		0.3475
June 30, 2020	August 13, 2020	1.2		18.2		18.2		37.6		0.3475

Earnings in excess of distributions are allocated to the limited partners based on their respective percentage interests. Payments made to the Partnership’s unitholders are determined in relation to actual distributions declared and are not based on the net income allocations used in the calculation of net income per unit.

In addition to the common and subordinated units, the Partnership also identified the incentive distribution rights ("IDRs") currently held by the General Partner as a participating security and uses the two-class method when calculating the net income per unit applicable to limited partners that is based on the weighted-average number of common units outstanding during the period.

When calculating basic earnings per unit under the two-class method for a master limited partnership, net income for the current reporting period is reduced by the amount of available cash that will be distributed to the General Partner and limited

13

BP MIDSTREAM PARTNERS LP  

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

(in millions of dollars, unless otherwise indicated)

partners for that reporting period. The following tables show the allocation of net income to arrive at net income per limited partner unit for the three and six months ended June 30, 2020 and 2019:

	Three Months Ended June 30,				Six Months Ended June 30,
	2020		2019		2020		2019
Net income attributable to the Partnership	$	40.6	$	37.3	$	82.3	$	74.5
Less:
Incentive distribution rights currently held by the General Partner	1.2		0.4		2.4		0.6
Limited partners' distribution declared on common units	18.2		17.0		36.4		33.4
Limited partners' distribution declared on subordinated units	18.2		17.0		36.4		33.4
Net income attributable to the Partnership in excess of distributions	$	3.0	$	2.9	$	7.1	$	7.1

	Three Months Ended June 30, 2020
	General Partner		Limited Partners' Common Units		Limited Partners' Subordinated Units		Total
Distributions declared	$	1.2	$	18.2	$	18.2	$	37.6
Net income attributable to the Partnership in excess of distributions	—		1.5		1.5		3.0
Net income attributable to the Partnership	$	1.2	$	19.7	$	19.7	$	40.6
Weighted average units outstanding:
Basic and Diluted			52.4		52.4		104.8
Net income per limited partner unit (in dollars):
Basic and Diluted			$	0.38	$	0.38

	Six Months Ended June 30, 2020
	General Partner		Limited Partners' Common Units		Limited Partners' Subordinated Units		Total
Distributions declared	$	2.4	$	36.4	$	36.4	$	75.2
Net income attributable to the Partnership in excess of distributions	—		3.6		3.5		7.1
Net income attributable to the Partnership	$	2.4	$	40.0	$	39.9	$	82.3
Weighted average units outstanding:
Basic and Diluted			52.4		52.4		104.8
Net income per limited partner unit (in dollars):
Basic and Diluted			$	0.77	$	0.77

14

BP MIDSTREAM PARTNERS LP  

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

(in millions of dollars, unless otherwise indicated)

	Three Months Ended June 30, 2019
	General Partner		Limited Partners' Common Units		Limited Partners' Subordinated Units		Total
Distributions declared	$	0.4	$	17.0	$	17.0	$	34.4
Net income attributable to the Partnership in excess of distributions	—		1.5		1.4		2.9
Net income attributable to the Partnership	$	0.4	$	18.5	$	18.4	$	37.3
Weighted average units outstanding:
Basic and Diluted			52.4		52.4		104.8
Net income per limited partner unit (in dollars):
Basic and Diluted			$	0.35	$	0.35

	Six Months Ended June 30, 2019
	General Partner		Limited Partners' Common Units		Limited Partners' Subordinated Units		Total
Distributions declared	$	0.6	$	33.4	$	33.4	$	67.4
Net income attributable to the Partnership in excess of distributions	—		3.6		3.5		7.1
Net income attributable to the Partnership	$	0.6	$	37.0	$	36.9	$	74.5
Weighted average units outstanding:
Basic and Diluted			52.4		52.4		104.8
Net income per limited partner unit (in dollars):
Basic and Diluted			$	0.70	$	0.70

9. Fair Value Measurements

The carrying amounts of accounts receivable, accounts payable, and accrued liabilities approximate their fair values due to their short-term nature.

The carrying value of borrowings under the term loan as of June 30, 2020, and the credit facility as of December 31, 2019, approximate fair value as the interest rates are reflective of market rates.

10. Commitments and Contingencies

Legal Proceedings

The Partnership is a party to ongoing legal proceedings in the ordinary course of business. For each outstanding legal matter, if any, we will evaluate the merits of the case, exposure to the matter, possible legal or settlement strategies and the likelihood of an unfavorable outcome. While the outcome of these proceedings cannot be predicted with certainty, we do not believe the results of these proceedings, individually or in the aggregate, will have a material adverse effect on the Partnership's business, financial condition, results of operations or liquidity.

Indemnification

Under an omnibus agreement, our Parent will indemnify us for certain environmental liabilities, litigation and other matters attributable to the ownership or operation of assets prior to Partnership ownership. For the purposes of determining the indemnified amount of any loss suffered or incurred by the Partnership, the Partnership’s ownership of 28.5% in Mars, and 65% in Mardi Gras, and Mardi Gras’ 56% ownership in Caesar, 53% ownership in Cleopatra, 65% ownership in Endymion and 65% ownership in Proteus will be considered. Indemnification for certain identified environmental liabilities is subject to a cap of $25 million without any deductible. Other matters covered by the omnibus agreement are subject to a cap of $15 million and an

15

BP MIDSTREAM PARTNERS LP  

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

(in millions of dollars, unless otherwise indicated)

aggregate deductible of $0.5 million before we are entitled to indemnification. Indemnification for any unknown environmental liabilities is limited to liabilities due to occurrences prior to the closing of the Initial Public Offering ("IPO") and that are identified before the third anniversary of the closing of the IPO.

The Interest Purchase Agreement contains customary representations, warranties and covenants of our Parent and the Partnership. Our Parent, on the one hand, and the Partnership, on the other hand, have agreed to indemnify each other and their respective affiliates, officers, directors and other representatives against certain losses, including those resulting from any breach of their representations, warranties or covenants contained in the Interest Purchase Agreement, subject to certain limitations and survival periods. This agreement covers the Partnership’s ownership of 22.7% in Ursa and 25% in KM Phoenix.

Environmental Matters

We are subject to federal, state, and local environmental laws and regulations. We record provisions for environmental liabilities based on management’s best estimates, using all information that is available at the time. In making environmental liability estimations, we consider the material effect of environmental compliance, pending legal actions against us and potential third-party liability claims. Often, as the remediation evaluation and effort progress, additional information is obtained, requiring revisions to estimated costs. We are indemnified by our Parent under the omnibus agreement against environmental cleanup costs for incidents that occurred prior to Partnership ownership. Revisions to the estimated environmental liability for conditions that are not indemnified under the omnibus agreement with our Parent are reflected in the Partnership's condensed consolidated statements of operations in the year in which they are probable and reasonably estimable.

We accrued $3.6 million and $3.7 million for environmental liabilities at June 30, 2020 and December 31, 2019, respectively. These balances are broken down on the condensed consolidated balance sheets as follows:

	Balance sheet location	June 30, 2020		December 31, 2019
Current portion of environmental remediation obligations	Other current liabilities	$	0.4	$	0.6
Long-term portion of environmental remediation obligations	Other liabilities	3.2		3.1
Total		$	3.6	$	3.7

The balances are related to incidents that occurred prior to our ownership and are entirely indemnified by our Parent. As a result, we recorded corresponding indemnification assets $3.6 million and $3.7 million at June 30, 2020 and December 31, 2019, respectively. These balances are broken down on the condensed consolidated balance sheets as follows:

	Balance sheet location	June 30, 2020		December 31, 2019
Current portion of indemnification assets	Other current assets	$	0.4	$	0.6
Non-current portion of indemnification assets	Other assets	3.2		3.1
Total		$	3.6	$	3.7

Griffith Station Incident

On June 13, 2019, a building fire occurred at the Griffith Station on BP2. Management performed an evaluation of the assets and recorded an impairment in 2019. A charge of $2.3 million for the impairment and $0.8 million for response expenses were recorded under "Impairment and other, net" on our condensed consolidated statements of operations for the three and six months ended June 30, 2019. Our assets are insured with a deductible of $1.0 million per incident. We accrued an offsetting insurance receivable of $2.1 million under "Other current assets" on our condensed consolidated balance sheet as of June 30, 2019.

We have incurred $0.1 million and $0.2 million for response expense during the three and six months ended June 30, 2020, respectively. Total costs associated with the incident were offset with an insurance receivable of $5.2 million under "Other current assets" on our condensed consolidated balance sheet as of June 30, 2020. The insurance receivable is recorded as $4.3 million under "Other current assets" and $0.7 million under "Other assets" on our consolidated balance sheet as of December 31, 2019.

16

BP MIDSTREAM PARTNERS LP  

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

(in millions of dollars, unless otherwise indicated)

11. Unit-Based Compensation

Long-Term Incentive Plan

On October 26, 2017, the General Partner adopted the BP Midstream Partners LP 2017 Long Term Incentive Plan (the “LTIP”). Awards under the LTIP are available for eligible officers, directors, employees and consultants of the General Partner and its affiliates, who perform services for the Partnership. The LTIP allows the Partnership to grant unit options, unit appreciation rights, restricted units, phantom units, unit awards, cash awards, performance awards, distribution equivalent rights, substitute awards and other unit-based awards. The maximum aggregate number of common units that may be issued pursuant to the awards granted under the LTIP shall not exceed 5,502,271, subject to proportionate adjustment in the event of unit splits and similar events.

Unit-Based Awards under the LTIP

The following is a summary of phantom unit award activities of the Partnership’s common units for the six months ended June 30, 2020:

	Phantom Units
	Number of Units (in units)	Weighted Average Grant Date Fair Value per Unit (in dollars)
Outstanding at December 31, 2019	15,227	$	16.64
Granted	16,038	14.03
Vested	(15,227)	16.64
Outstanding at June 30, 2020	16,038	$	14.03

For the three and six months ended June 30, 2020, total compensation expense recognized for phantom unit awards were approximately $56 thousand and $119 thousand, respectively. For the three and six months ended June 30, 2019, total compensation expense recognized for phantom unit awards was approximately $71 thousand and $111 thousand, respectively. The unrecognized compensation cost related to phantom unit awards was approximately $147 thousand at June 30, 2020, which is expected to be recognized over a weighted average period of 0.7 years.

12. Variable Interest Entity

Mardi Gras is a Delaware limited liability company and a pass-through entity for U.S. federal and state income tax purposes. Mardi Gras holds equity interests in the Mardi Gras Joint Ventures and accounts for them as equity method investments. Mardi Gras does not have any other operations or activities. The remaining interests in each of the Mardi Gras Joint Ventures are owned by unaffiliated third-party investors. Each of the Mardi Gras Joint Ventures is managed by its respective management committee, and decisions made by these management committees require approval of two or more members that are not affiliates with equity interest holdings meeting certain thresholds.

We have 65% ownership interest and 100% managing member interest in Mardi Gras. The remainder of the economic interest in Mardi Gras was held 34% by BP Pipelines and 1% by an affiliate of BP. Through our managing member interest in Mardi Gras, we have the right to vote 100% of Mardi Gras’ interest in each of the Mardi Gras Joint Ventures. We determined that Mardi Gras is a variable interest entity because (i) we hold disproportional voting rights as compared to our economic interest in Mardi Gras, and (ii) substantially all of Mardi Gras’ activities involve or are conducted on behalf of our Parent, which holds disproportionately few voting rights.

The managing member interest in Mardi Gras provides us with the unilateral power to direct the activities of Mardi Gras that most significantly impact its economic performance including the right to exercise the voting rights of BP for each of the Mardi Gras Joint Ventures. In addition, our obligations to absorb the expected losses of and the right to receive the residual returns from Mardi Gras relative to our economic ownership is significant to Mardi Gras. As a result, we are the primary beneficiary of Mardi Gras and consolidate Mardi Gras.

We have the obligation to provide financial support to Mardi Gras if all members unanimously determine that additional capital contributions are necessary to fund Mardi Gras’ operations. The assets of Mardi Gras can only be used to satisfy its own

17

BP MIDSTREAM PARTNERS LP  

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

(in millions of dollars, unless otherwise indicated)

obligations, which were zero at June 30, 2020 and December 31, 2019. Under the current limited liability company agreement of Mardi Gras, creditors of Mardi Gras, if any, do not have any recourse to the general credit of the Partnership.

The financial position of Mardi Gras at June 30, 2020 and December 31, 2019, its financial performance for the three and six months ended June 30, 2020 and 2019 and cash flows for the six months ended June 30, 2020 and 2019, as reflected in the condensed consolidated financial statements, are as follows:

	June 30, 2020		December 31, 2019
Balance sheet
Equity method investments	$	386.6	$	391.3
Non-controlling interests	135.3		136.9

	Three Months Ended June 30,				Six Months Ended June 30,
	2020		2019		2020		2019
Statement of operations
Income from equity method investments	$	13.7	$	13.9	$	30.3	$	23.8
Less: Net income attributable to non-controlling interests	4.8		4.8		10.6		8.3
Net impact on Net income attributable to the Partnership	$	8.9	$	9.1	$	19.7	$	15.5

	Six Months Ended June 30,
	2020		2019
Statement of cash flows
Cash flows from operating activities
Distributions of earnings received from equity method investments	$	29.8	$	23.7
Cash flows from investing activities
Distribution in excess of earnings from equity method investments	5.2		6.6
Cash flows from financing activities
Distributions to non-controlling interests	(12.2)		(10.6)
Net change on the Partnership's cash and cash equivalents	$	22.8	$	19.7

13. Subsequent Events

We have evaluated subsequent events through the issuance of these condensed consolidated financial statements. Based on this evaluation, it was determined that no subsequent events occurred, other than the distribution noted below, that require recognition or disclosure in the condensed consolidated financial statements.

Distribution

On July 15, 2020, we declared a cash distribution of $0.3475 per limited partner unit to unitholders of record on July 30, 2020, for the three months ended June 30, 2020. The distribution, combined with distributions to our General Partner, will be paid on August 13, 2020, and will total $37.6 million, with $16.6 million distributed to our non-affiliated common unitholders, and $21.0 million, including $1.2 million for IDRs distributed to our Parent in respect of its ownership of our common units, subordinated units and IDRs.

18

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This quarterly report on Form 10-Q (the “Quarterly Report”) includes various “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended ("Exchange Act"). All statements other than statements of historical fact included in this Quarterly Report, regarding Partnership's strategy, future growth, future operations, future actions, the continued effects of the global COVID-19 pandemic on demand, the effects of the continued volatility of commodity prices and the related macroeconomic and political environment, volumes, capital requirements, conditions or events, future operating results or the ability to generate sales, our potential exposure to market risks, statements relating to the expected amount of cash available for distribution and level of distributions, financial position, estimated revenues and losses, projected cost, prospects, plans and objectives of management, are forward-looking statements.

When used in this Quarterly Report, you can identify forward-looking statements by words such as “anticipate,” “believe,” “estimate,” “expect,” “forecast,” “goal,” “intend,” “plan,” “predict,” “project,” “seek,” “target,” “could,” “may,” “should,” “would” or other similar expressions that convey the uncertainty of future events or outcomes, although not all forward-looking statements contain such identifying words. When considering forward-looking statements, you should carefully consider the risk factors and other cautionary statements described under the heading “Risk Factors” in the Annual Report on Form 10-K for the year ended December 31, 2019, under Part II, Item 1A of our Quarterly Reports and other cautionary statements contained in this filing.

We based forward-looking statements on current expectations and assumptions about future events and currently available information as to the outcome and timing of future events. We caution you that these statements are not guarantees of future performance as they involved assumptions that, while made in good faith, may prove to be incorrect, and involve risks and uncertainties we cannot predict. Accordingly, actual outcomes and results may differ materially from what the Partnership has expressed or forecast in the forward-looking statements.

Forward-looking statements may include statements about:

•The continuation of a material decline in global crude oil demand and crude oil prices for an uncertain period of time that correspondingly may lead to a significant reduction of domestic crude oil and natural gas production, which in turn could result in significant declines in the actual or expected volumes transported through our pipelines and/or the reduction of commercial opportunities that might otherwise be available to us.

•Uncertainty regarding the easing of restrictions on various commercial and economic activities by applicable authorities, as well as the potential reinstatement of such restrictions, in response to the spread of COVID-19; such restrictions are designed to protect public health but also have the effect of significantly reducing demand for crude oil, natural gas, refined products and diluent.

•Uncertainty regarding the future actions of foreign oil producers such as Saudi Arabia and Russia and the risk that they take actions that will prolong or exacerbate the current over-supply of crude oil.

•Uncertainty regarding the timing, pace and extent of an economic recovery in the United States and elsewhere, which in turn will likely affect demand for crude oil and therefore the demand for the midstream services we provide and the commercial opportunities available to us.

•The effect of an overhang of significant amounts of crude oil inventory stored in the United States and elsewhere and the impact that such inventory overhang ultimately has on our customer’s operations as well as the timing of a return to market conditions that support increased drilling and production activities in the United States.

•Our inability to perform our obligations under our contracts, whether due to non-performance by third parties, including our customers or counterparties, market constraints, third-party constraints, legal constraints (including governmental orders or guidance), or other factors.

•The continued ability of BP and any non-affiliate customers to satisfy their obligations under commercial and other agreements and the impact of lower market prices for crude oil, natural gas, refined products and diluent including the ability to satisfy such obligations as they may be impacted by the effects of COVID-19.

•The volume of crude oil, natural gas, refined products and diluent we transport or store and the prices that we can charge Partnership customers.

•The tariff rates with respect to volumes that we transport through Partnership regulated assets, which rates are subject to review and possible adjustment imposed by federal and state regulators.

•Changes in revenue the Partnership realizes under the fixed loss allowance provisions fees and tariffs resulting from changes in underlying commodity prices.

•Fluctuations in the prices for crude oil, natural gas, refined products and diluent.

•The level of onshore and offshore production and demand for crude oil, natural gas, refined products and diluent.

•Partnership ability to successfully integrate recently acquired assets and realize the anticipated benefits of such acquisitions.

19

•Changes in global economic conditions and the effects of a global economic downturn on the business of BP and the business of its suppliers, customers, business partners and credit lenders.

•Liabilities associated with the risks and operational hazards inherent in transporting and/or storing crude oil, natural gas, refined products and diluent.

•Curtailment of operations or expansion projects due to unexpected leaks or spills; severe weather disruption; riots, strikes, lockouts or other industrial disturbances; or failure of information technology systems due to various causes, including unauthorized access or attack.

•The impact of current and future laws, rulings, governmental regulations, accounting standards and statements, and related interpretations.

•Costs or liabilities associated with federal, state and local laws and regulations relating to environmental protection and safety, including spills, releases and pipeline integrity.

•Costs associated with compliance with evolving environmental laws and regulations on climate change.

•Costs associated with compliance with safety regulations and system maintenance programs, including pipeline integrity management program testing and related repairs.

•Changes in tax status.

•Changes in the cost or availability of third-party vessels, pipelines, rail cars and other means of delivering and transporting crude oil, natural gas, refined products and diluent.

•Direct or indirect effects on Partnership operations resulting from actual or threatened terrorist incidents or acts of war.

•Changes in, and availability to us of the equity and debt capital markets.

Many of the foregoing risks and uncertainties are, and will be, exacerbated by the COVID-19 pandemic and any consequent worsening of the global business and economic environment. New factors emerge from time to time, and it is not possible for us to predict all such factors. Should one or more of the risks or uncertainties described in this Quarterly Report occur, or should underlying assumptions prove incorrect, actual results and plans could differ materially from those expressed in any forward-looking statements.

All forward-looking statements, expressed or implied, included in this Quarterly Report are expressly qualified in their entirety by this cautionary statement. This cautionary statement should also be considered in connection with any subsequent written or oral forward-looking statements that the Partnership or persons acting on the Partnership's behalf may issue.

Except as otherwise required by applicable law, we disclaim any duty to update any forward-looking statements, all of which are expressly qualified by the statements in this section, to reflect events or circumstances after the date of this Quarterly Report.

Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS

Unless otherwise stated or the context otherwise indicates, all references to “we,” “our,” “us,” refer to the legal entity BP Midstream Partners LP (the "Partnership"). The term “our Parent” refers to BP Pipelines (North America), Inc. (“BP Pipelines”), any entity that wholly owns BP Pipelines, indirectly or directly, including BP America Inc. and BP p.l.c. (“BP”), and any entity that is wholly owned by the aforementioned entities, excluding BP Midstream Partners LP.

The following management discussion and analysis of financial conditions and results of operations should be read in conjunction with the unaudited financial statements and accompanying notes in this quarterly report and our Annual Report on Form 10-K for the year ended December 31, 2019 (the "Partnership's 2019 10-K"). All amounts are in millions of dollars, unless otherwise indicated.

Partnership Overview

We are a fee-based, growth-oriented master limited partnership formed by BP Pipelines, an indirect wholly owned subsidiary of BP, to own, operate, develop and acquire pipelines and other midstream assets. Partnership assets consist of interests in entities that own crude oil, natural gas, refined products and diluent pipelines and refined product terminals serving as key infrastructure for BP and other customers to transport onshore crude oil production to BP’s Whiting Refinery and offshore crude oil and natural gas production to key refining markets and trading and distribution hubs. Certain Partnership assets deliver refined products and diluent from the Whiting Refinery and other U.S. supply hubs to major demand centers.

20

As of June 30, 2020, the Partnership's assets consisted of the following: 

•BP Two Pipeline Company LLC, which owns the BP#2 crude oil pipeline system (“BP2”).

•BP River Rouge Pipeline Company LLC, which owns the Whiting to River Rouge refined products pipeline system (“River Rouge”).

•BP D-B Pipeline Company LLC, which owns the Diamondback diluent pipeline system (“Diamondback”). BP2, River Rouge, and Diamondback together are referred to as the "Wholly Owned Assets".

•28.5% ownership interest in Mars Oil Pipeline Company, LLC (“Mars”), which owns a major corridor crude oil pipeline system in the Gulf of Mexico. 

•65% ownership interest and 100% managing member interest in Mardi Gras Transportation System Company, LLC (“Mardi Gras”), which holds the following investments in joint ventures located in the Gulf of Mexico:

•56% ownership interest in Caesar Oil Pipeline Company, LLC (“Caesar”),

•53% ownership interest in Cleopatra Gas Gathering Company, LLC (“Cleopatra”),

•65% ownership interest in Proteus Oil Pipeline Company, LLC (“Proteus”), and,

•65% ownership interest in Endymion Oil Pipeline Company, LLC (“Endymion”). Together Endymion, Caesar, Cleopatra and Proteus are referred to as the “Mardi Gras Joint Ventures.”

•22.7% ownership interest in Ursa Oil Pipeline Company, LLC ("Ursa").

•25% ownership interest in KM Phoenix Holdings, LLC ("KM Phoenix").

The Partnership generates a majority of revenue by charging fees for the transportation of crude oil, refined products and diluent through pipelines under long-term agreements with minimum volume commitments (“MVC”). We do not engage in the marketing and trading of any commodities. All operations are conducted in the United States, and all long-lived assets are located in the United States. Partnership operations consist of one reportable segment.

Certain Partnership businesses are subject to regulation by various authorities including, but not limited to the Federal Energy Regulatory Commission ("FERC"). Regulatory bodies exercise statutory authority over matters such as common carrier tariffs, construction, rates and ratemaking and agreements with customers.

Business Environment, Market Conditions and Outlook

The impact to the energy industry from both the recent swift and material decline in commodity prices and the global outbreak of COVID-19 have been unprecedented. Through the end of the second quarter, our assets remain operational. We did experience some adverse financial impact through the second quarter which we expect to continue. Management continues to monitor the challenging macro environment. For risks associated with these and other factors, see “Item 1A. Risk Factors” in this Quarterly Report.

Management continues to work closely with BP Pipelines, as operator of our assets under the Omnibus Agreement, to ensure appropriate practices are adopted for continued functioning of our assets as well as mitigation strategies for any office or worksite where COVID-19 may be detected.

COVID-19

In the first quarter of 2020, the COVID-19 outbreak spread across the globe. Federal, state and local governments mobilized to implement containment mechanisms and minimize impacts to their populations and economies. Various containment measures, which included the quarantining of cities, regions and countries, have resulted in a significant drop in general economic activity and a resulting decrease in demand for petroleum and petroleum-based products.

In the second quarter of 2020, as COVID-19 appeared to decrease or stabilize in certain areas, certain local, regional and national authorities began to loosen such containment measures and restrictions in various locations in an effort to begin economic recovery, among other purposes. While this relaxation of containment measures has initially led to an increased demand for petroleum and petroleum-based products through improved general economic conditions, there was also a resurgence of COVID-19 cases in June 2020 and continuing into July 2020 that resulted in the reinstatement of containment measures and restrictions, which could lower demand for petroleum and petroleum-based products.

Decline in Demand and Potential Impact to Our Operations

The unprecedented supply and demand dynamics created by demand decreases resulting from COVID-19 and supply increases resulting from recent periods of increased production by members of the Organization of Petroleum Exporting Countries (“OPEC”) and other countries, including Russia ("OPEC+"), beginning in March 2020, have resulted in severe

21

declines in commodity prices and created volatility, uncertainty, and turmoil in the oil and gas industry. While in April 2020, OPEC+ agreed to cut production, the production cuts have yet to offset the decrease in demand resulting from the COVID-19 pandemic and related economic repercussions. As a result, the price of oil has remained depressed to historic levels and available storage and transportation capacity for production is limited. However it is uncertain whether capital and production cuts will continue and, if so, whether they will be sufficient to offset the continued low demand resulting from the COVID-19 pandemic. Demand, and pricing, may again decline due to the resurgence of the outbreak across the U.S. and other locations across the world and the related social distancing guidelines, travel restrictions, and stay-at-home orders, although the extent of the additional impact on our industry and our business cannot be reasonably predicted at this time.

In the six months ended June 30, 2020, we have experienced an adverse financial impact on our onshore pipelines as a result of reduced demand partially offset by $6.0 million of deficiency revenue recorded under our MVCs on all onshore pipelines, which extend through December 31, 2020 (and for certain volumes on Diamondback, through June 30, 2021). Throughput on our onshore pipelines was approximately 13.9% lower as compared to the first quarter of 2020, primarily due to reduced volumes on BP2 reflective of lower refinery utilization as a result of reduced demand related to COVID-19 and lower throughput on River Rouge and Diamondback, which was driven by lower demand for refined products, and lower demand for diluent in connection with reduced Canadian heavy crude production, respectively. We could experience a material financial impact if volumes shipped on our pipelines remain below such minimum commitments beyond the end of 2020 as a result of reduced consumer demand due to the response to the COVID-19 pandemic. If these conditions persist beyond December 31, 2020 and BP does not renew or extend our MVCs at all or at similar levels, it could have a material adverse effect on our financial results and condition. BP has no obligation to renew or extend our MVCs at any level.

We expect demand to be resilient, as offshore projects are larger capital projects planned over many years and less impacted by temporary changes in capital investment. Although we experienced a decline in volumes on our offshore pipelines during the second quarter, that decrease was primarily due to the short term impact of tropical storm Cristobal and planned maintenance activities, and to a lesser degree, lower demand due to COVID related impacts. BP and our other customers, as well as us and other third-party operators of our pipelines, have implemented various protocols for both onshore and offshore personnel in efforts to limit the impact of COVID-19; however, those may not prove fully successful. There is risk of decreased volumes with respect to the offshore operations if operators take actions to reduce operations in response to demand declines or increasingly limited storage availability or are unable to control COVID-19 infections on platforms and are required to shut-in. Additionally, we expect the shippers on the offshore pipelines to continue to find buyers for their production; however, they may not be successful.

We have taken steps and continue to actively work to mitigate the evolving challenges and growing impact of both the COVID-19 pandemic and the industry downturn on our operations and our financial condition. We have also worked with BP Pipelines and the third-party operators of our assets to ensure that COVID-19 response and business continuity plans have been implemented across all of our assets and operations. BP employees, including BP Pipelines personnel, have been working from home since March 16, 2020, except those deemed critical to the functioning of owned and managed assets. For those that are critical and are required to be on-site, protocols have been implemented to protect those employees. Thus far, BP employees working remotely have not significantly impacted our operations, including use of financial reporting systems, nor has it significantly impacted our internal control environment. We have not incurred, and in the future do not expect to incur, significant expenses related to business continuity. However, our continuing operations and the management of the immediate and contingent safety measures would likely become increasingly difficult if a significant number of BP employees are infected by COVID-19 and the practical difficulties of social distancing impact productivity.

We also continue to monitor our liquidity position. As of June 30, 2020, we had available capacity of $132 million under our unsecured revolving credit facility with an affiliate of BP and $114.9 million cash and our only outstanding indebtedness is $468 million outstanding under the term loan, with no principal payments due until 2025. We experienced a decline in the price of our common units over the first six months of 2020, a condition that is consistent across our sector and may impact our ability to access capital markets. We do not have any debt covenants or other lending arrangements that depend upon our unit price. We are in compliance with the covenants contained in both our revolving credit facility and term loan, both of which include the requirement to maintain a consolidated leverage ratio, which is calculated as total indebtedness to consolidated EBITDA, not to exceed 5.0 to 1.0, subject to a temporary increase in such ratio to 5.5 to 1.0 in connection with certain material acquisitions. Please see “Capital Resources and Liquidity” and Note 6 - Debt for additional information.

We are unable to reasonably predict when, or to what extent, demand for petroleum and petroleum-based products and the overall markets and global economy will stabilize, and the pace of any subsequent recovery for the oil and gas industry. Further, to what extent these events do ultimately impact our business, liquidity, financial condition, and results of operations is highly uncertain and dependent on numerous evolving factors that cannot be predicted, including the duration of the pandemic. As noted above, BP Pipelines and the third-party operators of our assets have taken steps and continue to actively work to

22

mitigate the evolving challenges and growing impact of both the COVID-19 pandemic and the industry downturn on our operations and financial condition. However, given the tremendous uncertainty and turmoil, there is no certainty that the measures we take will be ultimately sufficient.

How We Evaluate Our Operations

Partnership management uses a variety of financial and operating metrics to analyze performance. These metrics are significant factors in assessing operating results and profitability and include: (i) safety and environmental metrics, (ii) revenue (including FLA) from throughput and utilization; (iii) operating expenses and maintenance spend; (iv) Adjusted EBITDA (as defined below); and (v) cash available for distribution (as defined below).

Preventative Safety and Environmental Metrics

We are committed to maintaining and improving the safety, reliability and efficiency of Partnership operations. As noted above, we have worked with BP Pipelines and the third-party operators of our assets to ensure that COVID-19 response and business continuity plans have been implemented across all of our assets and operations. We have implemented reporting programs requiring all employees and contractors of our Parent who provide services to us to record environmental and safety related incidents. The Partnership's management team uses these existing programs and data to evaluate trends and potential interventions to deliver on performance targets. We integrate health, occupational safety, process safety and environmental principles throughout Partnership operations to reduce and eliminate environmental and safety related incidents.

Throughput

We have historically generated substantially all of our revenue under long-term agreements or FERC-regulated generally applicable tariffs by charging fees for the transportation of products through our pipelines. The amount of revenue we generate under these agreements depends in part on the volumes of crude oil, natural gas, refined products and diluent on our pipelines.

Volumes on pipelines are primarily affected by the supply of, and demand for, crude oil, natural gas, refined products and diluent in the markets served directly or indirectly by Partnership assets. Results of operations are impacted by our ability to:

•utilize any remaining unused capacity on, or add additional capacity to, Partnership pipeline systems;

•increase throughput volumes on Partnership pipeline systems by making connections to existing or new third-party pipelines or other facilities, primarily driven by the anticipated supply of and demand for crude oil, natural gas, refined products and diluent;

•identify and execute organic expansion projects; and

•increase throughput volumes via acquisitions.

In addition, substantially all of our aggregate revenue on BP2, Diamondback and River Rouge is supported by commercial agreements with BP Products. We are a party to two throughput and deficiency agreements with BP Products and one dedication agreement with a third-party for Diamondback. The dedication agreement and one throughput and deficiency agreement for Diamondback were renewed in 2020 and will now expire in June 2021. The other throughput and deficiency agreement for Diamondback will expire on December 31, 2020 by its term, if it is not renewed. BP Products has entered into minimum volume commitment agreements with respect to BP2 and River Rouge, and these two throughput and deficiency agreements will expire by their terms on December 31, 2020, if they are not renewed.

Storage Utilization

Storage utilization is a metric that we use to evaluate the performance of our storage and terminalling assets. We define storage utilization as the percentage of the contracted capacity in barrels compared to the design capacity of the tank.

Operating Expenses and Total Maintenance Spend

Operating Expenses

Management seeks to maximize profitability by effectively managing operating expenses. These expenses are comprised primarily of labor expenses (including contractor services), general materials, supplies, minor maintenance, utility costs (including electricity and fuel) and insurance premiums. Utility costs fluctuate based on throughput volumes and the grades of crude oil and types of refined products we handle. Other operating expenses generally remain relatively stable across broad

23

ranges of throughput volumes but can fluctuate from period to period depending on the mix of activities performed during that period.

Total Maintenance Spend - Wholly Owned Assets

We calculate Total Maintenance Spend as the sum of maintenance expenses and maintenance capital expenditures, excluding any reimbursable maintenance capital expenditures. We track these expenses on a combined basis because it is useful to understanding total maintenance requirements. Total Maintenance Spend for the six months ended June 30, 2020 and 2019, respectively, is shown in the table below:

	Six Months Ended June 30,
	2020		2019
	(in millions of dollars)
Wholly Owned Assets
Maintenance expenses	$	1.8	$	0.9
Maintenance capital expenditures	1.2		0.3
Maintenance capital recovery(1)	(0.6)		—
Total Maintenance Spend - Wholly Owned Assets	$	2.4	$	1.2
(1) Relates to the portion of maintenance capital for the Griffith Station Incident reimbursable by insurance.

The Partnership seeks to maximize profitability by effectively managing maintenance expenses, which consist primarily of safety and environmental integrity programs. We seek to manage maintenance expenses on owned and operated pipelines by scheduling maintenance over time to avoid significant variability in maintenance expenses and minimize impact on cash flows, without compromising our commitment to safety and environmental stewardship.

Maintenance expenses represent the costs we incur that do not significantly extend the useful life or increase the expected output of property, plant and equipment. These expenses include pipeline repairs, replacements of immaterial sections of pipelines, inspections, equipment rentals and costs incurred to maintain compliance with existing safety and environmental standards, irrespective of the magnitude of such compliance expenses. Maintenance expenses may vary significantly from period to period because certain expenses are the result of scheduled safety and environmental integrity programs, which occur on a multi-year cycle and require substantial outlays.

Maintenance capital expenditures represent expenditures to sustain operating capacity or operating income over the long term. Examples of maintenance capital expenditures include expenditures made to purchase new or replacement assets or extend the useful life of existing assets. These expenditures includes repairs and replacements of storage tanks, replacements of significant sections of pipelines and improvements to an asset’s safety and environmental standards.

Adjusted EBITDA and Cash Available for Distribution

The Partnership defines Adjusted EBITDA as net income before net interest expense, income taxes, gain or loss from disposition of property, plant and equipment, and depreciation and amortization, plus cash distributed to the Partnership from equity method investments for the applicable period, less income from equity method investments. The Partnership defines Adjusted EBITDA attributable to the Partnership as Adjusted EBITDA less Adjusted EBITDA attributable to non-controlling interests. We present these financial measures because we believe replacing our proportionate share of equity method investments’ net income with the cash received from such equity method investments more accurately reflects the cash flow from our business, which is meaningful to our investors.

We compute and present cash available for distribution and define it as Adjusted EBITDA attributable to the Partnership less maintenance capital expenditures attributable to the Partnership, net interest paid/received, cash reserves, income taxes paid and net adjustments from volume deficiency payments attributable to the Partnership. Cash available for distribution does not reflect changes in working capital balances.

Adjusted EBITDA and cash available for distribution are non-GAAP supplemental financial measures, which are metrics that management and external users of Partnership condensed consolidated financial statements, such as industry analysts, investors, lenders and rating agencies, may use to assess:

•operating performance as compared to other publicly traded Partnerships in the midstream energy industry, without regard to historical cost basis or financing methods;

24

•ability to generate sufficient cash to support decisions to make distributions to our unitholders;

•ability to incur and service debt and fund capital expenditures; and

•viability of acquisitions and other capital expenditure projects and the returns on investment of various investment opportunities.

We believe that the presentation of Adjusted EBITDA and cash available for distribution provides useful information to investors in assessing our financial condition and results of operations. The GAAP measures most directly comparable to Adjusted EBITDA and cash available for distribution are net income and net cash provided by operating activities, respectively. Adjusted EBITDA and cash available for distribution should not be considered as an alternative to GAAP net income or net cash provided by operating activities.

Adjusted EBITDA and cash available for distribution have important limitations as analytical tools because they exclude some but not all items that affect net income and net cash provided by operating activities. You should not consider Adjusted EBITDA or cash available for distribution in isolation or as a substitute for analysis of our results as reported under GAAP. Additionally, because Adjusted EBITDA and cash available for distribution may be defined differently by other companies in our industry, our definition of Adjusted EBITDA and cash available for distribution may not be comparable to similarly titled measures of other companies, thereby diminishing its utility. Please read “Reconciliation of Non-GAAP Measures” section below for the reconciliation of net income and cash provided by operating activities to Adjusted EBITDA and cash available for distribution.

Factors Affecting Our Business

Partnership business can be negatively affected by sustained downturns or slow growth in the economy in general and is impacted by shifts in supply and demand dynamics, the mix of services requested by the customers of our pipelines, competition and changes in regulatory requirements affecting our customers’ operations. For example, as discussed earlier, in March of 2020, the spot price of West Texas Intermediate (“WTI”) crude declined over 50% in response to reductions in global demand due to the COVID-19 pandemic and announcements by Saudi Arabia and Russia of plans to increase crude oil production. In addition to the collapse and current volatility in oil prices, demand for many refined petroleum products has also declined sharply causing refineries to curtail output. The ultimate magnitude and duration of the COVID-19 pandemic, resulting governmental restrictions on the mobility of consumers and the related impact on crude oil prices and the U.S. and global economy and capital markets is uncertain. The uncertain future impacts of COVID-19 and swift shifts in the demand for oil may negatively impact our financial position, particularly our cash flows and liquidity. As of the date of this Quarterly Report, all of our assets remain operational. We did experience some adverse financial impact through the second quarter which we expect to continue.

Customers

BP is our primary customer. Total revenue from BP represented 97.5% and 97.1% of our revenues for the three and six months ended June 30, 2020, respectively. Total revenue from BP represented 97.5% and 97.4% of our revenues for the three and six months ended June 30, 2019, respectively. BP’s volumes represented approximately 94.2% and 93.8% of the aggregate total volumes transported on the Wholly Owned Assets for the three and six months ended June 30, 2020, respectively. BP’s volumes represented approximately 94.9% and 95.0% of the aggregate total volumes transported on the Wholly Owned Assets for the three and six months ended June 30, 2019, respectively.

In addition, we transport and store crude oil, natural gas and diluent for a mix of third-party customers, including crude oil producers, refiners, marketers and traders, and Partnership assets are connected to other crude oil, natural gas and diluent pipeline systems. In addition to serving directly connected Midwestern U.S. and Gulf Coast markets, our pipelines have access to customers in various regions of the United States and Canada through interconnections with other major pipelines. Customers use our transportation and terminalling services for a variety of reasons. Producers of crude oil require the ability to deliver their product to market and frequently enter into firm transportation contracts to ensure that they will have sufficient capacity available to deliver their product to delivery points with greatest market liquidity. Marketers and traders generate income from buying and selling crude oil, natural gas, refined products and diluent to capitalize on price differentials over time or between markets. Our customer mix can vary over time and largely depends on the crude oil, natural gas, refined products and diluent supply and demand dynamics in our markets.

Regulation

Interstate common carrier pipelines are subject to regulation by various federal, state and local agencies including the FERC, the Environmental Protection Agency ("EPA") and the Department of Transportation ("DOT"). On June 18, 2020, FERC issued

25

a Notice of Inquiry requesting comments on a proposed oil pipeline index using the Producer Price Index for Finished Goods (PPI-FG) plus 0.09% as the index level, and requested comments on whether and how the index should reflect changes to FERC’s policies regarding income tax costs and return on equity. The Notice of Inquiry is subject to a comment period, after which FERC will issue a final oil pipeline index for the five-year period commencing July 1, 2021. FERC’s final application of its indexing rate methodology for the next five-year term of index rates may impact our revenues associated with any transportation services we may provide pursuant to rates adjusted by the FERC oil pipeline index. For more information on federal, state and local regulations affecting our business, see Part I, Item 1 and 2. Business and Properties in the Partnership's 2019 10-K.

Acquisition Opportunities

The Partnership plans to pursue acquisitions of complementary assets from BP as well as third parties subject to market conditions (including the ongoing effects of COVID-19) and our ability to obtain attractive financing. We may also pursue acquisitions jointly with BP Pipelines. BP Pipelines has granted us a right of first offer with respect to its retained ownership interest in Mardi Gras and all of its interests in midstream pipeline systems and assets related thereto in the contiguous United States and offshore Gulf of Mexico that were owned by BP Pipelines when we were established. Neither BP nor any of its affiliates are under any obligation, however, to sell or offer to sell us additional assets or to pursue acquisitions jointly with us, and we are under no obligation to buy any additional assets from them or to pursue any joint acquisitions with them. We will focus our acquisition strategy on transportation and midstream assets within the crude oil, natural gas and refined products sectors. We believe that we are well positioned to acquire midstream assets from BP, and particularly BP Pipelines, as well as third parties, should such opportunities arise. Identifying and executing acquisitions will be a key part of our strategy. However, if we do not make acquisitions on economically acceptable terms, our future growth will be limited, and the acquisitions we do make may reduce, rather than increase, our available cash.

Financing

We expect to fund future capital expenditures primarily from external sources, including borrowings under our credit facility and potential future issuances of equity and debt securities.

We intend to make cash distributions to unitholders at a minimum distribution rate of $0.2625 per unit per quarter ($1.05 per unit on an annualized basis). Based on the terms of our cash distribution policy, we expect that we will distribute to unitholders and the General Partner, as the holder of IDRs, most of the cash generated by operations.

Griffith Station Incident

On June 13, 2019, a building fire occurred at the Griffith Station on BP2. Management performed an evaluation of the assets and recorded an impairment in 2019. A charge of $2.3 million for the impairment and $0.8 million for response expenses were recorded under "Impairment and other, net" on our condensed consolidated statements of operations for the three and six months ended June 30, 2019. Our assets are insured with a deductible of $1.0 million per incident. We accrued an offsetting insurance receivable of $2.1 million under "Other current assets" on our condensed consolidated balance sheet as of June 30, 2019.

We have incurred $0.1 million and $0.2 million for response expense during the three and six months ended June 30, 2020, respectively. Total costs associated with the incident were offset with an insurance receivable of $5.2 million under "Other current assets" on our condensed consolidated balance sheet as of June 30, 2020. The insurance receivable is recorded as $4.3 million under "Other current assets" and $0.7 million under "Other assets" on our consolidated balance sheet as of December 31, 2019.

26

Results of Operations

The following tables and discussion contain a summary of condensed consolidated results of operations for the three and six months ended June 30, 2020 and 2019.

As mentioned above in Item 2 - COVID-19, through the second quarter of 2020, our financial condition and results of operations have been adversely impacted by the COVID-19 pandemic and the current volatility and decline in commodity prices. We could experience a material financial impact if volumes shipped on our onshore assets remain below the MVCs beyond the end of 2020 and the MVCs are not renewed. Additionally, if the economic downturn extends into 2021, including limited demand for refined products and a depressed oil price, we would be exposed to lower volumes flowing through our onshore assets without the benefit of the current MVCs from BP. Lower volumes flowing through the offshore assets, either due to depressed demand or lack of storage capacity or both, could cause our income from equity method investments to decline until such time as demand recovers.

	Three Months Ended June 30,				Six Months Ended June 30,
	2020		2019		2020		2019
	(in millions of dollars)
Revenue	$	31.5	$	28.6	$	62.2	$	58.8
Costs and expenses
Operating expenses	4.4		4.8		9.6		9.6
Maintenance expenses	1.5		0.7		1.8		1.0
General and administrative	4.3		4.1		9.1		8.5
Depreciation	0.6		0.7		1.3		1.3
Impairment and other, net	—		1.0		—		1.0
Property and other taxes	0.2		0.2		0.3		0.3
Total costs and expenses	11.0		11.5		22.1		21.7
Operating income	20.5		17.1		40.1		37.1
Income from equity method investments	26.8		28.8		58.1		53.2
Interest expense, net	1.9		3.8		5.3		7.5
Net income	45.4		42.1		92.9		82.8
Less: Net income attributable to non-controlling interests	4.8		4.8		10.6		8.3
Net income attributable to the Partnership	$	40.6	$	37.3	$	82.3	$	74.5
Adjusted EBITDA*	$	52.9	$	51.6	$	107.4	$	100.7
Less: Adjusted EBITDA attributable to non-controlling interests	5.5		6.0		12.2		10.6
Adjusted EBITDA attributable to the Partnership	$	47.4	$	45.6	$	95.2	$	90.1
* See Reconciliation of Non-GAAP Measures below.

27

	Three Months Ended June 30,				Six Months Ended June 30,
Pipeline throughput (thousands of barrels per day)(1)	2020		2019		2020		2019
BP2	260		275		273		291
Diamondback	61		55		71		67
River Rouge	59		73		66		71
Total Wholly Owned Assets	380		403		410		429
Mars	501		569		519		562
Caesar	159		204		172		209
Cleopatra(2)	17		26		19		26
Proteus	209		184		217		141
Endymion	209		184		217		141
Mardi Gras Joint Ventures	594		598		625		517
Ursa	87		119		91		116
Average revenue per barrel ($ per barrel)(3)
Total Wholly Owned Assets	$	0.74	$	0.78	$	0.75	$	0.76
Mars	1.36		1.16		1.38		1.19
Mardi Gras Joint Ventures	0.62		0.66		0.61		0.69
Ursa	0.92		0.88		0.89		0.87
(1) Pipeline throughput is defined as the volume of delivered barrels.
(2) Natural gas is converted to oil equivalent at 5.8 million cubic feet per one thousand barrels.
(3) Based on reported revenues from transportation and allowance oil divided by delivered barrels over the same time period.

Three Months Ended June 30, 2020 Compared to Three Months Ended June 30, 2019

Total revenue from wholly owned assets increased by approximately $2.9 million or 10.1% for the three months ended June 30, 2020, compared to the three months ended June 30, 2019, due to the following factors:

•Increase of $6.0 million from the recognition of deficiency revenue in current period.

•Increase of $0.3 million or 12.3% in throughput revenue attributable to a 10.4% increase in throughput volume and a 1.7% increase in the weighted average tariff rate from Diamondback.

•Decrease of $1.8 million or 69.1% in revenues from allowance oil primarily due to lower volume on BP2 and a lower realized price per barrel.

•Decrease of $1.4 million or 15.4% in throughput revenue attributable to a 19.5% decrease in throughput volume and partially offset by a 5.2% increase in weighted average tariff rate from River Rouge.

•Decrease of $0.2 million or 1.1% in throughput revenue attributable to a 5.4% decrease in throughput volume partially offset by a 4.6% increase in weighted average tariff rate from BP2.

Operating expenses decreased by $0.4 million or 8.3% for the three months ended June 30, 2020, compared to the three months ended June 30, 2019, primarily attributable to a $0.5 million decrease in energy and drag reducing agent costs due to lower volumes.

Maintenance expenses increased by $0.8 million or 114.3% for the three months ended June 30, 2020, compared to the three months ended June 30, 2019 due to pipeline repairs completed in 2020.

Impairment expense decreased by $1.0 million in the three months ended June 30, 2020 compared to the three months ended June 30, 2019, as no impairment expenses were recognized in the current period.

Income from equity method investments decreased by $2.0 million or 6.9% for the three months ended June 30, 2020, compared to the three months ended June 30, 2019, primarily due to a decrease in throughput volume and revenue on Mars,

28

Caesar, Cleopatra, and Ursa. In addition, due to lower customer demand, income from KM Phoenix was lower for the three months ended June 30, 2020 compared to the three months ended June 30, 2019.

Interest expense decreased by $1.9 million or 50.0% in the three months ended June 30, 2020, compared to the three months ended June 30, 2019, due to lower interest rates in the quarter from the term loan arrangement compared to the credit facility we had outstanding for the three months ended June 30, 2019.

Six Months Ended June 30, 2020 Compared to Six Months Ended June 30, 2019

Total revenue from wholly owned assets increased by approximately $3.4 million or 5.8% for the six months ended June 30, 2020, compared to the six months ended June 30, 2019, due to the following factors:

•Increase of $6.0 million from the recognition of deficiency revenue in current period.

•Increase of $0.7 million or 10.4% in throughput revenue attributable to a 7.2% increase in throughput volume and a 3.0% increase in the weighted average tariff rate from Diamondback.

•Decrease of $2.8 million or 54.9% in revenue from allowance oil primarily due to lower volume on BP2 and a lower realized price per barrel.

•Decrease of $0.4 million or 1.3% in throughput revenue attributable to a 5.5% decrease in throughput volume that was partially offset by 4.4% increase in the weighted average tariff rate from BP2, and

•Decrease of $0.1 million or 0.5% in throughput revenue attributable to a 6.4% decrease in throughput volume that was partially offset by 6.3% increase in weighted average tariff rate from River Rouge.

Maintenance expenses increased by $0.8 million or 80.0% for the six months ended June 30, 2020, compared to the six months ended June 30, 2019 due to pipeline repairs completed in 2020

General and administrative expenses increased by $0.6 million or 7.1% for the six months ended June 30, 2020, compared to the six months ended June 30, 2019. For the six months ended June 30, 2020, the increase was primarily from the increase in omnibus fee in first quarter.

Impairment expense decreased by $1.0 million in the six months ended June 30, 2020 compared to the six months ended June 30, 2019, as no impairment expenses were recognized in the current period.

Income from equity method investments increased by $4.9 million or 9.2% for the six months ended June 30, 2020 compared to the six months ended June 30, 2019 due to incremental throughput volume from Appomattox, which transports volume through Proteus and Endymion, in the first quarter of 2020 and the negative impact of maintenance activities on Proteus and Endymion in the first quarter of 2019.

Interest expense, net decreased by $2.2 million or 29.3% in the six months ended June 30, 2020 primarily due to lower interest rates in the second quarter of 2020 from the term loan arrangement compared to the credit facility we had outstanding for the six months ended June 30, 2019.

Net income attributable to non-controlling interests increased by $2.3 million or 27.7% for the six months ended June 30, 2020, compared to the six months ended June 30, 2019 due to the increase in earnings from the Mardi Gras investments in the period.

Reconciliation of Non-GAAP Measures

The following tables present a reconciliation of Adjusted EBITDA to net income and to net cash provided by operating activities, the most directly comparable GAAP financial measures, for each of the periods indicated.

29

	Three Months Ended June 30,				Six Months Ended June 30,
	2020		2019		2020		2019
	(in millions of dollars)
Reconciliation of Adjusted EBITDA and Cash Available for Distribution to Net Income
Net income	$	45.4	$	42.1	$	92.9	$	82.8
Add:
Depreciation	0.6		0.7		1.3		1.3
Interest expense, net	1.9		3.8		5.3		7.5
Cash distributions received from equity method investments — Mardi Gras Joint Ventures	15.8		17.2		35.0		30.3
Cash distributions received from equity method investments — Mars	13.7		13.7		26.7		25.8
Cash distributions received from equity method investments — Others	2.3		2.9		4.3		6.2
Less:
Income from equity method investments — Mardi Gras Joint Ventures	13.7		13.9		30.3		23.8
Income from equity method investments — Mars	11.6		11.9		24.1		23.7
Income from equity method investments — Others	1.5		3.0		3.7		5.7
Adjusted EBITDA	52.9		51.6		107.4		100.7
Less:
Adjusted EBITDA attributable to non-controlling interests	5.5		6.0		12.2		10.6
Adjusted EBITDA attributable to the Partnership	47.4		45.6		95.2		90.1
Add:
Net adjustments from volume deficiency agreements	(1.7)		1.0		(1.6)		0.3
Maintenance capital recovery(1)	—		—		0.6		—
Less:
Net interest paid/(received)	0.8		3.7		8.0		11.4
Maintenance capital expenditures	0.5		0.1		1.2		0.3
Cash reserves(2)	1.2		(0.1)		(2.3)		(3.9)
Cash available for distribution attributable to the Partnership	$	43.2	$	42.9	$	87.3	$	82.6

⁽¹⁾ Relates to the portion of maintenance capital for the Griffith Station Incident reimbursable by insurance.

⁽²⁾ Reflects cash reserved due to timing of interest payment(s).

30

	Six Months Ended June 30,
	2020		2019
	(in millions of dollars)
Reconciliation of Adjusted EBITDA and Cash Available for Distribution to Net Cash Provided by Operating Activities
Net cash provided by operating activities	$	99.5	$	87.3
Add:
Interest expense, net	5.3		7.5
Distribution in excess of earnings from equity method investments	5.3		6.6
Less:
Changes in other assets and liabilities	2.6		(0.4)
Non-cash adjustments	0.1		0.1
Impairment and other, net*	—		1.0
Adjusted EBITDA	107.4		100.7
Less:
Adjusted EBITDA attributable to non-controlling interests	12.2		10.6
Adjusted EBITDA attributable to the Partnership	95.2		90.1
Add:
Net adjustments from volume deficiency agreements	(1.6)		0.3
Maintenance capital recovery(1)	0.6		—
Less:
Net interest paid/(received)	8.0		11.4
Maintenance capital expenditures	1.2		0.3
Cash reserves(2)	(2.3)		(3.9)
Cash available for distribution attributable to the Partnership	$	87.3	$	82.6

⁽¹⁾ Relates to the portion of maintenance capital for the Griffith Station Incident reimbursable by insurance.

⁽²⁾ Reflects cash reserved due to timing of interest payment(s).

* Includes $3.1 million of costs related to the Griffith Incident (impairment charge of $2.3 million and $0.8 million for the response expense), net of $(2.1) million in offsetting insurance receivable. The net charge of $1.0 million reflects our insurance deductible.

Capital Resources and Liquidity

Currently, we expect our primary ongoing sources of liquidity to be cash generated from operations (including distribution from equity method investments), and, as needed, borrowings under our existing credit facility. The entities in which we own an interest may also incur debt. We believe that cash generated from these sources will be sufficient to meet our short-term working capital requirements and long-term capital expenditure requirements and to make quarterly cash distributions. As of June 30, 2020, our liquidity was $246.9 million, consisting of $114.9 million of cash and $132 million available under our existing credit facility with BP. Our only debt outstanding is our $468 million borrowed under our term loan with an affiliate of BP, and there are no principal payments required with respect to that facility until 2025.

Through the second quarter of 2020, our financial condition and results of operations have been adversely impacted by the COVID-19 pandemic and the current volatility and decline in commodity prices. We could experience a material financial impact if volumes shipped on our onshore assets remain below the MVCs beyond the end of 2020 and the MVCs are not renewed. Additionally, there is risk of decreased volumes with respect to the offshore operations if operators take actions to reduce operations in response to demand declines or increasingly limited storage availability or are unable to control COVID-19 infections on platforms and are required to shut-in. In the longer term, if reduced demand were to persist through 2021 or longer, we may not be able to continue to generate similar levels of operating cash flow and our liquidity and capital resources may not be sufficient to make our current levels of cash distributions to unitholders or even meet our minimum quarterly distribution. Although we continue to actively work to mitigate the evolving challenges and growing impact of both the COVID-19 pandemic and the industry downturn on our operations and our financial condition, there is no certainty that the measures we take will be ultimately sufficient.

31

Cash Distributions

The board of directors of our General Partner has adopted a cash distribution policy pursuant to which we intend to pay a minimum quarterly distribution of $0.2625 per unit per quarter, which equates to approximately $27.5 million per quarter, or approximately $110 million per year in the aggregate, based on the number of common and subordinated units outstanding as of June 30, 2020. We intend to pay such distributions to the extent we have sufficient cash after the establishment of cash reserves and the payment of expenses, including payments to our General Partner and its affiliates.

On July 15, 2020, we declared a cash distribution of $0.3475 per limited partner unit to unitholders of record on July 30, 2020, for the three months ended June 30, 2020. The distribution, combined with distributions to our General Partner, will be paid on August 13, 2020, and will total $37.6 million, with $16.6 million distributed to our non-affiliated common unitholders, and $21.0 million, including $1.2 million for IDRs distributed to our Parent in respect of its ownership of our common units, subordinated units and IDRs.

Revolving Credit Facility

On October 30, 2017, the Partnership entered into the $600 million unsecured Credit Facility with an affiliate of BP. The Credit Facility terminates on October 30, 2022, and provides for certain covenants, including the requirement to maintain a consolidated leverage ratio, which is calculated as total indebtedness to consolidated EBITDA (as defined in the Credit Facility), not to exceed 5.0 to 1.0, subject to a temporary increase in such ratio to 5.5 to 1.0 in connection with certain material acquisitions. In addition, the limited liability company agreement of our General Partner requires the approval of BP Holdco prior to the incurrence of any indebtedness that would cause our leverage ratio to exceed 4.5 to 1.0.

The Credit Facility also contains customary events of default, such as (i) nonpayment of principal when due, (ii) nonpayment of interest, fees or other amounts, (iii) breach of covenants, (iv) misrepresentation, (v) cross-payment default and cross-acceleration (in each case, to indebtedness in excess of $75 million) and (vi) insolvency. Additionally, the Credit Facility limits our ability to, among other things: (i) incur or guarantee additional debt, (ii) redeem or repurchase units or make distributions under certain circumstances; and (iii) incur certain liens or permit them to exist. Indebtedness under this facility bears interest at the 3-month London Interbank Offered Rate ("LIBOR") plus 0.85%. This facility includes customary fees, including a commitment fee of 0.10% and a utilization fee of 0.20%.

In connection with our acquisition in the fourth quarter of 2018, we borrowed $468 million from the Credit Facility. This amount was outstanding at December 31, 2019, and repaid as of March 31, 2020.

Term Loan Facility Agreement

On February 24, 2020, the Partnership entered into a $468 million term loan with an affiliate of BP. On March 13, 2020, proceeds were used to repay outstanding borrowings under our existing Credit Facility. Please refer to Note 9 - Debt in the Partnership's 2019 10-K for further details. The term loan has a final repayment date of February 24, 2025 and provides for certain covenants, including the requirement to maintain a consolidated leverage ratio, which is calculated as total indebtedness to consolidated EBITDA, not to exceed 5.0 to 1.0, subject to a temporary increase in such ratio to 5.5 to 1.0 in connection with certain material acquisitions. Simultaneous with this transaction, we entered into a First Amendment to Short Term Credit Facility Agreement ("First Amendment") whereby the lender added a provision that indebtedness under both the term loan and credit facility shall not exceed $600 million. All other terms of the credit facility remain the same. As of June 30, 2020, the Partnership was in compliance with the covenants contained in the term loan facility and the credit facility.

Cash Flows from Operations

Operating Activities. We generated $99.5 million and $87.3 million in cash flow from operating activities in the six months ended June 30, 2020 and 2019, respectively. The $12.2 million increase in cash flows from operating activities resulted from a $5.0 million increase in distribution from equity method investments, $3.0 million increase in working capital, and a net $4.2 million increase due to an increase in operating income and a reduction in interest expense.

Investing Activities. Cash flow generated by investing activities was $4.0 million and $6.3 million in the six months ended June 30, 2020 and 2019, respectively. The $2.3 million decrease in cash flow generated by investing activities was primarily due to a $1.0 million increase in capital expenditures, and a $1.3 reduction in distribution in excess of earnings from equity method investments during the six months ended June 30, 2020.

32

Financing Activities. Cash flow used in financing activities was $87.4 million and $75.2 million in the six months ended June 30, 2020 and 2019, respectively. The $12.2 million increase in the usage of cash for financing activities was due to increases related to distributions to unitholders and our General Partner of $10.6 million and to non-controlling interest of $1.6 million.

Capital Expenditures

Our operations can be capital intensive, requiring investment to expand, upgrade or enhance existing operations and to meet environmental and operational regulations. Capital requirements consist of maintenance capital expenditures and expansion capital expenditures, both as defined in our Partnership agreement. We are required to distinguish between maintenance capital expenditures and expansion capital expenditures in accordance with our Partnership agreement.

A summary of capital expenditures associated with ongoing projects related to the Wholly Owned Assets, for the six months ended June 30, 2020 and 2019, is shown in the table below:

	Six Months Ended June 30,
	2020		2019
	(in millions of dollars)
Cash spent on expansion capital expenditures	$	0.1	$	—
Cash spent on maintenance capital expenditures	1.2		0.3
Increase in accrued capital expenditures	0.3		—
Total capital expenditures incurred	$	1.6	$	0.3

Contractual Obligations

There were no material changes to contractual obligations as disclosed in the Partnership's 2019 10-K.

Off-Balance Sheet Arrangements

The Partnership has not entered into any transactions, agreements or other contractual arrangements that would result in off-balance sheet liabilities.

Critical Accounting Policies and Estimates

There have been no material changes to critical accounting policies as disclosed in the Partnership's 2019 10-K.

Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Information about market risks for the three and six months ended June 30, 2020, does not differ materially from that discussed under Item 7A of the Partnership's 2019 10-K.

Item 4. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

The Partnership's management, with the participation of the principal executive officer and principal financial officer, evaluated the effectiveness of disclosure controls and procedures as of the end of the period covered by this report. Our disclosure controls and procedures are designed to provide reasonable assurance that the information required to be disclosed in the reports that are filed or submitted under the Exchange Act is accumulated and communicated to management, including our principal executive officer and principal financial officer, to allow timely decisions regarding required disclosure. Based upon that evaluation, the Partnership's principal executive officer and principal financial officer concluded that our disclosure controls and procedures (as defined in Rules 13(a)-15(e) and 15(d)-15(e) under the Securities Exchange Act of 1934, as amended), were effective at a reasonable assurance level as of June 30, 2020.

33

Changes in Internal Control Over Financial Reporting

There were no changes in the Partnership's system of internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) during the quarterly period ended June 30, 2020 that have materially affected, or are reasonably likely to materially affect, internal controls over financial reporting.

PART II - OTHER INFORMATION

Item 1. LEGAL PROCEEDINGS

The Partnership is a party to ongoing legal proceedings in the ordinary course of business. While the outcome of these proceedings cannot be predicted with certainty, we do not believe the results of these proceedings, individually or in the aggregate, will have a material adverse effect on our business, financial condition, results of operations or liquidity. In addition, pursuant to the terms of the various agreements under which we acquired assets from BP since the IPO, BP will indemnify us for certain liabilities relating to litigation and environmental matters attributable to the ownership or operation of the acquired assets prior to our acquisition of those assets.

Item 1A. RISK FACTORS

The Partnership is subject to various risks and uncertainties in the course of business. Security holders and potential investors in the Partnership's securities should carefully consider the risk factors set forth below and set forth under “Risk Factors” in the Partnership's 2019 10-K.

Events outside of our control, including a pandemic such as the global outbreak of COVID-19, and the potential global recession could have a material adverse impact on our financial position, results of operations and cash flows.

In the first quarter of 2020, the COVID-19 outbreak began to spread quickly across the globe. Federal, state and local governments mobilized to implement containment mechanisms and minimize impacts to their populations and economies. Various containment measures, which included the quarantining of cities, regions and countries have resulted in a severe drop in general economic activity and a decrease in energy demand. The risks associated with COVID-19 have also impacted the BP Pipelines workforce and the way we meet our business objectives.

The impacts of a global recession would likely extend the time for the current oil markets to absorb excess supplies and rebalance inventory resulting in decreased demand for our midstream services for a number of future quarters.

The current commodity price environment may remain depressed based on over-supply, decreasing demand and a potential global economic recession, as is evidenced by the current historically low prices in the forward curve for oil, for several years. With decreased demand and the storage and transportation constraints further adding to the pressure on commodities prices, refiners have curtailed output, and producers all over the world – including in the United States – have significantly decreased their capital programs and shut-in production. If these conditions persist beyond December 31, 2020, and continue to result in a significant decline in demand for our services with respect to our onshore pipelines and BP does not renew or extend our MVCs at all or at similar levels, it could have a material effect on our financial results and condition. BP has no obligation to renew or extend our MVCs at any level.

In addition, it is possible that volumes may be reduced on our offshore pipelines as well, which are not covered by any MVCs. In the short term, there is risk of decreased volumes with respect to the offshore operations if operators take actions to reduce operations in response to demand declines or increasingly limited storage availability or are unable to control COVID-19 infections on platforms and are required to shut-in. In the longer term, there is risk that our customers cease investing in additional offshore projects in a protracted low commodity price environment, which would harm our growth. Our profitability may be significantly affected by this decreased demand and these factors could lead to reductions in our distributions to unitholders.

In addition, the outbreak of COVID-19 could potentially further impact the BP Pipelines workforce. The infection of key personnel, and/or the infection of a significant amount of the BP Pipelines workforce, could have a material adverse impact on our business, financial condition and results of operations. BP employees have been working from home since March 16, 2020, except those deemed critical to the functioning of owned and managed assets. A remote workforce could introduce risks to achieving business objectives and/or the ability to maintain our controls and procedures. For example, the technology required for the transition to remote work increases our vulnerability to cybersecurity threats, including threats of unauthorized access to sensitive information or to render data or systems unusable, the impact of which may have material adverse effects on our

34

business and operations. See “Item 1A. Risk Factors - Terrorist or cyber-attacks and threats, or escalation of military activity in response to these attacks, could have a material adverse effect on our business, financial condition or results of operations” in the Partnership's 2019 10-K.

In addition to the risks stated above, our operations are subject to additional risks related to the current economic environment caused by the factors discussed above, including:

•our debt service requirements and other liabilities, and restrictions contained in our debt agreements;

•our ability to maintain sufficient cash available for distribution following the establishment of cash reserves and payment of fees and expenses, to enable us to pay minimum quarterly distributions to unitholders;

•unavailability of third-party pipelines, production platforms, refineries, caverns and other facilities interconnected to our pipelines to transport, produce, refine or store crude oil, natural gas, refined products or diluent;

•demand for refined products or diluent, continues to decrease; and

•the risk of further adverse changes to BP’s production or development plans, which we are dependent on for a majority of the crude oil, natural gas, refined products and diluent that we transport

The impacts of COVID-19 and the significant drop in consumer demand has had an unprecedented impact on the global economy and our business. We are unable to predict all potential impacts to our business, the severity of such impacts or the duration.

Item 5. OTHER INFORMATION

Disclosures Required Pursuant to Section 13(r) of the Securities Exchange Act of 1934

In accordance with our General Business Principles and Code of Conduct, we seek to comply with all applicable international trade laws including applicable sanctions and embargoes.

Under the Iran Threat Reduction and Syria Human Rights Act of 2012, and Section 13(r) of the Exchange Act, we are required to include certain disclosures in our periodic reports if we or any of our “affiliates” (as defined in Rule 12b-2 under the Exchange Act) knowingly engaged in certain specified activities during the period covered by the report. Because the SEC defines the term “affiliate” broadly, it includes any entity controlled by us as well as any person or entity that controls us or is under common control with us.

The disclosure below relates solely to activities conducted by non-U.S. affiliates of BP p.l.c. that may be deemed to be under common control with us. The disclosure does not relate to any activities conducted directly by us (including our subsidiaries and equity investments), or our general partner and does not involve our or the general partner’s management.

For purposes of this disclosure, we refer to BP p.l.c. and its subsidiaries other than us, the general partner and BP Midstream Partners Holdings LLC as the “BP Group.” References to actions taken by the BP Group mean actions taken by the applicable BP Group company. None of the payments disclosed below were made in U.S. dollars, however, for disclosure purposes, all have been converted into U.S. dollars at the appropriate exchange rate. We do not believe that any of the transactions or activities listed below violated U.S. sanctions:

•BP p.l.c. indirectly owns a 29.3% interest in Middle East Lubricants Company LLC (“Melubco”), a non-operated joint venture, manufacturing lubricants in the United Arab Emirates.

•In November 2018, an Iranian shipping company brought a claim in Iran against Melubco, for non-payment of shipping fees, and obtained a judgment in absentia with a US dollar equivalent value of approximately $60,000.

•In November 2019, the Consulate General of The Islamic Republic of Iran in Dubai formally notified Melubco that a case had been filed.

•In May 2020, Melubco paid court filing fees to the Tehran Judicial Services Office with a US dollar equivalent value of approximately $2,694. The payment was required to appeal the judgment obtained in absentia against Melubco.

•Melubco refutes the claim on the basis that it has never contracted with or received any services from this shipping company.

35

Item 6. EXHIBITS

BP MIDSTREAM PARTNERS LP

INDEX TO EXHIBITS

Exhibit No.	Exhibit Description	Incorporated by Reference				Filed Herewith	Furnished Herewith
		Form	Exhibit	Filing Date	SEC File No.
3.1	Certificate of Limited Partnership of BP Midstream Partners LP.	S-1	3.1	9/11/2017	333-220407
3.2	Amended and Restated Agreement of Limited Partnership of BP Midstream Partners LP dated October 30, 2017.	10-Q	3.2	12/6/2017	001-38260
3.3	Certificate of Formation of BP Midstream Partners GP LLC.	S-1	3.3	9/11/2017	333-220407
3.4	First Amended and Restated Limited Liability Company Agreement of BP Midstream Partners GP LLC.	S-1	3.4	9/11/2017	333-220407
31.1	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.					X
31.2	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.					X
32*	Certifications pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.						X
101	The following financial information from BP Midstream Partners LP’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2020, formatted in iXBRL (Inline Extensible Business Reporting Language) includes: (i) the Condensed Consolidated Balance Sheets, (ii) the Condensed Consolidated Statements of Operations, (iii) the Condensed Consolidated Statements of Changes in Equity, (iv) the Condensed Consolidated Statements of Cash Flows, and (v) the Notes to Condensed Consolidated Financial Statements.					X
104	The cover page from BP Midstream Partners LP’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2020, formatted in iXBRL.					X

* Pursuant to SEC Release No. 33-8212, this certification will be treated as “accompanying” this Quarterly Report on Form 10-Q and not “filed” as part of such report for purposes of Section 18 of the Exchange Act or otherwise subject to the liability of Section 18 of the Exchange Act, and this certification will not be deemed to be incorporated by reference into any filing under the Securities Act, except to the extent that the registrant specifically incorporates it by reference.

36

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Date: August 6, 2020	BP MIDSTREAM PARTNERS LP
	By:	BP MIDSTREAM PARTNERS GP LLC,
		its general partner
	By:	/s/ Craig W. Coburn
		Craig W. Coburn
		Chief Financial Officer and Director

37

EX-31.1

Exhibit 31.1

CERTIFICATION PURSUANT TO SECTION 302 OF

THE SARBANES-OXLEY ACT OF 2002

I, Robert P. Zinsmeister, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of BP Midstream Partners LP;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

1.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

2.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

3.Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

4.Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

1.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

2.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 6, 2020	/s/ Robert P. Zinsmeister
	Robert P. Zinsmeister
	Chief Executive Officer and Director
	BP Midstream Partners GP LLC
	(the general partner of BP Midstream Partners LP)

EX-31.2

Exhibit 31.2

CERTIFICATION PURSUANT TO SECTION 302 OF

THE SARBANES-OXLEY ACT OF 2002

I, Craig W. Coburn, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of BP Midstream Partners LP;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

1.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

2.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

3.Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

4.Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

1.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

2.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 6, 2020	/s/ Craig W. Coburn
	Craig W. Coburn
	Chief Financial Officer and Director
	BP Midstream Partners GP LLC
	(the general partner of BP Midstream Partners LP)

EX-32

Exhibit 32

CERTIFICATIONS PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of BP Midstream Partners LP (the “Partnership”) on Form 10-Q for the period ended June 30, 2020, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), each of the undersigned hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to his knowledge:

(1)the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2)the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Partnership.

Date: August 6, 2020	/s/ Robert P. Zinsmeister
	Robert P. Zinsmeister
	Chief Executive Officer and Director
	BP Midstream Partners GP LLC
	(the general partner of BP Midstream Partners LP)

/s/ Craig W. Coburn

Craig W. Coburn

Chief Financial Officer and Director

BP Midstream Partners GP LLC

(the general partner of BP Midstream Partners LP)

XML

Cover - shares	6 Months Ended
	Jun. 30, 2020	Aug. 05, 2020
Entity Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jun. 30, 2020
Document Transition Report	false
Entity File Number	001-38260
Entity Registrant Name	BP Midstream Partners LP
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	82-1646447
Entity Address, Address Line One	501 Westlake Park Boulevard
Entity Address, City or Town	Houston
Entity Address, State or Province	TX
Entity Address, Postal Zip Code	77079
City Area Code	281
Local Phone Number	366-2000
Title of 12(b) Security	Common Units, Representing Limited Partner Interests
Trading Symbol	BPMP
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Current Fiscal Year End Date	--12-31
Amendment Flag	false
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q2
Entity Central Index Key	0001708301
Common Units
Entity Information [Line Items]
Entity Common Stock, Shares Outstanding		52,402,967
Subordinated Units
Entity Information [Line Items]
Entity Common Stock, Shares Outstanding		52,375,535

XML

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
Current assets
Cash and cash equivalents	$ 114,900	$ 98,800
Accounts receivable – third parties	200	600
Accounts receivable – related parties	10,700	11,300
Prepaid expenses	2,000	5,100
Other current assets	5,600	5,000
Total current assets	133,400	120,800
Equity method investments (Note 3)	526,500	534,400
Property, plant and equipment, net (Note 4)	62,900	62,700
Other assets	3,600	4,200
Total assets	726,400	722,100
Current liabilities
Accounts payable – third parties	800	600
Accounts payable – related parties	1,400	1,700
Deferred revenue and credits	1,600	1,500
Other current liabilities (Note 5)	5,200	6,600
Total current liabilities	9,000	10,400
Long-term debt (Note 6)	468,000	468,000
Other liabilities	3,600	3,500
Total liabilities	480,600	481,900
Commitments and contingencies (Note 10)
EQUITY
General partner	1,200	1,200
Total partner's capital	110,500	103,300
Non-controlling interests	135,300	136,900
Total equity	245,800	240,200
Total liabilities and equity	726,400	722,100
Common Units | Public
EQUITY
Common stock	855,000	851,600
Common Units | BP Holdco
EQUITY
Common stock	(60,000)	(60,300)
Subordinated Units | BP Holdco
EQUITY
Common stock	$ (685,700)	$ (689,200)

XML

CONSOLIDATED BALANCE SHEEETS (Parenthetical) - shares	Jun. 30, 2020	Dec. 31, 2019
Public | Common Units
Units outstanding (in shares)	47,821,790	47,806,563
Units issued (in shares)	47,821,790	47,806,563
BP Holdco | Common Units
Units outstanding (in shares)	4,581,177	4,581,177
Units issued (in shares)	4,581,177	4,581,177
BP Holdco | Subordinated Units
Units outstanding (in shares)	52,375,535	52,375,535
Units issued (in shares)	52,375,535	52,375,535

XML

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) - USD ($) $ in Thousands, shares in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Revenue
Third parties	$ 800	$ 700	$ 1,800	$ 1,500
Related parties	30,700	27,900		57,300
Total revenue	31,500	28,600	62,200	58,800
Costs and expenses
Operating expenses – third parties	3,100	3,400	6,800	6,700
Operating expenses – related parties	1,300	1,400	2,800	2,900
Maintenance expenses – related parties	100	100	200	100
General and administrative – third parties	700	400	1,600	1,400
General and administrative – related parties	3,600	3,700	7,500	7,100
Depreciation	600	700	1,300	1,300
Impairment and other, net	0	1,000	0	1,000
Property and other taxes	200	200	300	300
Total costs and expenses	11,000	11,500	22,100	21,700
Operating income	20,500	17,100	40,100	37,100
Income from equity method investments	26,800	28,800	58,100	53,200
Interest expense, net	1,900	3,800	5,300	7,500
Net income	45,400	42,100	92,900	82,800
Less: Net income attributable to non-controlling interests	4,800	4,800	10,600	8,300
Net income attributable to the Partnership	40,600	37,300	82,300	74,500
Limited Partners Common Units
Costs and expenses
Net income attributable to the Partnership	$ 19,700	$ 18,500	$ 40,000	$ 37,000
Net income attributable to the Partnership per limited partner unit – basic and diluted (in dollars):
Net income attributable to the Partnership per limited partner unit – basic and diluted (in dollars per share)	$ 0.38	$ 0.35	$ 0.77	$ 0.70
Limited Partners Subordinated Units
Costs and expenses
Net income attributable to the Partnership	$ 19,700	$ 18,400	$ 39,900	$ 36,900
Net income attributable to the Partnership per limited partner unit – basic and diluted (in dollars):
Net income attributable to the Partnership per limited partner unit – basic and diluted (in dollars per share)	$ 0.38	$ 0.35	$ 0.77	$ 0.70
Common Units Public
Weighted average number of limited partner units outstanding - basic and diluted (in millions):
Weighted average number of limited partner units outstanding - basic and diluted (in shares)	47.8	47.8	47.8	47.8
BP Holdco | Common Units BP Holdco
Weighted average number of limited partner units outstanding - basic and diluted (in millions):
Weighted average number of limited partner units outstanding - basic and diluted (in shares)	4.6	4.6	4.6	4.6
BP Holdco | Subordinated Units
Weighted average number of limited partner units outstanding - basic and diluted (in millions):
Weighted average number of limited partner units outstanding - basic and diluted (in shares)	52.4	52.4	52.4	52.4
Maintenance
Costs and expenses
Maintenance expenses – third parties	$ 1,400	$ 600	$ 1,600	$ 900

XML

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (UNAUDITED) - USD ($) $ in Millions	Total	Non-controlling Interests	Common Units Partners' Capital General Public	Common Units Partners' Capital BP Holdco	Subordinated Units Partners' Capital BP Holdco	General Partner
Beginning Balance at Dec. 31, 2018	$ 210.9	$ 141.0	$ 836.8	$ (61.7)	$ (705.2)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	40.7	3.5	16.9	1.6	18.5	$ 0.2
Distributions to unitholders	(31.6)		(14.4)	(1.4)	(15.8)
Distributions to non-controlling interests	(4.6)	(4.6)
Ending Balance at Mar. 31, 2019	215.4	139.9	839.3	(61.5)	(702.5)	0.2
Beginning Balance at Dec. 31, 2018	210.9	141.0	836.8	(61.7)	(705.2)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	82.8
Ending Balance at Jun. 30, 2019	218.6	138.7	841.3	(61.3)	(700.5)	0.4
Beginning Balance at Mar. 31, 2019	215.4	139.9	839.3	(61.5)	(702.5)	0.2
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	42.1	4.8	16.9	1.6	18.4	0.4
Distributions to unitholders	(33.0)		(15.0)	(1.4)	(16.4)	(0.2)
Unit-based compensation	0.1		0.1
Distributions to non-controlling interests	(6.0)	(6.0)
Ending Balance at Jun. 30, 2019	218.6	138.7	841.3	(61.3)	(700.5)	0.4
Beginning Balance at Dec. 31, 2019	240.2	136.9	851.6	(60.3)	(689.2)	1.2
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	47.5	5.8	18.5	1.8	20.2	1.2
Distributions to unitholders	(37.6)		(16.6)	(1.6)	(18.2)	(1.2)
Unit-based compensation	0.1		0.1
Distributions to non-controlling interests	(6.7)	(6.7)
Ending Balance at Mar. 31, 2020	243.5	136.0	853.6	(60.1)	(687.2)	1.2
Beginning Balance at Dec. 31, 2019	240.2	136.9	851.6	(60.3)	(689.2)	1.2
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	92.9
Ending Balance at Jun. 30, 2020	245.8	135.3	855.0	(60.0)	(685.7)	1.2
Beginning Balance at Mar. 31, 2020	243.5	136.0	853.6	(60.1)	(687.2)	1.2
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	45.4	4.8	18.0	1.7	19.7	1.2
Distributions to unitholders	(37.6)		(16.6)	(1.6)	(18.2)	(1.2)
Unit-based compensation	0.0		0.0
Distributions to non-controlling interests	(5.5)	(5.5)
Ending Balance at Jun. 30, 2020	$ 245.8	$ 135.3	$ 855.0	$ (60.0)	$ (685.7)	$ 1.2

XML

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (UNAUDITED) (Parenthetical) - $ / shares	Jun. 30, 2020	Mar. 31, 2020	Jun. 30, 2019	Mar. 31, 2019
Statement of Stockholders' Equity [Abstract]
Cash distributions per unit paid (in dollars per unit)	$ 0.3475	$ 0.3475	$ 0.3126	$ 0.3015

XML

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019
Cash flows from operating activities
Net income	$ 92,900	$ 82,800
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation	1,300	1,300
Impairment and other, net	0	1,000
Non-cash expenses	100	100
Income from equity method investments	(58,100)	(53,200)
Distributions of earnings received from equity method investments	60,700	55,700
Changes in operating assets and liabilities
Accounts receivable	1,000	(600)
Prepaid expenses and other current assets	3,100	2,600
Accounts payable	(100)	(1,000)
Deferred revenue and credits	100	2,600
Other	(1,500)	(4,000)
Net cash provided by operating activities	99,500	87,300
Cash flows from investing activities
Capital expenditures	(1,300)	(300)
Distributions in excess of earnings from equity method investments	5,300	6,600
Net cash provided by investing activities	4,000	6,300
Cash flows from financing activities
Proceeds from issuance of term loan	(468,000)	0
Distributions to unitholders and general partner	(75,200)	(64,600)
Distributions to non-controlling interests	(12,200)	(10,600)
Net cash used in financing activities	(87,400)	(75,200)
Net change in cash and cash equivalents	16,100	18,400
Cash and cash equivalents at beginning of the period	98,800	57,000
Cash and cash equivalents at end of the period	114,900	75,400
Supplemental cash flow information
Cash paid for interest	8,300	12,100
Non-cash investing transactions
Accrued capital expenditures	500	200
Proceeds from Issuance of Long-term Debt	$ 468,000	$ 0

XML

Business and Basis of Presentation

6 Months Ended

Jun. 30, 2020

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Business and Basis of Presentation

Business and Basis of Presentation

BP Midstream Partners LP (either individually or together with its subsidiaries, as the context requires, the “Partnership”) is a Delaware limited partnership formed on May 22, 2017 by BP Pipelines (North America) Inc. (“BP Pipelines”), an indirect wholly owned subsidiary of BP p.l.c. (“BP”), a “foreign private issuer” within the meaning of the Securities Exchange Act of 1934, as amended.

Unless otherwise stated or the context otherwise indicates, all references to “we,” “our,” “us,” or similar expressions refer to the legal entity BP Midstream Partners LP. The term “our Parent” refers to BP Pipelines; any entity that wholly owns BP Pipelines, indirectly or directly, including BP and BP America Inc. (“BPA”), an indirect wholly owned subsidiary of BP; and any entity that is wholly owned by the aforementioned entities, excluding BP Midstream Partners LP.

Business

BP Midstream Partners LP is a master limited partnership formed by BP Pipelines to own, operate, develop and acquire pipelines and other midstream assets. The Partnership's assets consist of interests in entities that own crude oil, natural gas, refined products and diluent pipelines and refined product terminals serving as key infrastructure for BP and other customers to transport onshore crude oil production to BP’s refinery in Whiting, Indiana (the “Whiting Refinery”) and offshore crude oil and natural gas production to key refining markets and trading and distribution hubs. Certain assets deliver refined products and diluent from the Whiting Refinery and other U.S. supply hubs to major demand centers.

As of June 30, 2020, the Partnership's assets consisted of the following:

•BP Two Pipeline Company LLC, which owns the BP#2 crude oil pipeline system (“BP2”).

•BP River Rouge Pipeline Company LLC, which owns the Whiting to River Rouge refined products pipeline system (“River Rouge”).

•BP D-B Pipeline Company LLC, which owns the Diamondback diluent pipeline system (“Diamondback”). BP2, River Rouge, and Diamondback, together, are referred to as the "Wholly Owned Assets".

•28.5% ownership interest in Mars Oil Pipeline Company, LLC (“Mars”), which owns a major corridor crude oil pipeline system in the Gulf of Mexico. 

•65% ownership interest and 100% managing member interest in Mardi Gras Transportation System Company, LLC ("Mardi Gras"), which holds the following investments in joint ventures located in the Gulf of Mexico:

•56% ownership interest in Caesar Oil Pipeline Company, LLC (“Caesar”),

•53% ownership interest in Cleopatra Gas Gathering Company, LLC (“Cleopatra”),

•65% ownership interest in Proteus Oil Pipeline Company, LLC (“Proteus”), and,

•65% ownership interest in Endymion Oil Pipeline Company, LLC (“Endymion”).

•Together Endymion, Caesar, Cleopatra and Proteus are referred to as the “Mardi Gras Joint Ventures.”

•22.7% ownership interest in Ursa Oil Pipeline Company, LLC ("Ursa").

•25% ownership interest in KM Phoenix Holdings, LLC ("KM Phoenix").

We generate a majority of revenue by charging fees for the transportation of crude oil, refined products and diluent through our pipelines under agreements with minimum volume commitments ("MVC"). We do not engage in the marketing and trading of any commodities. All operations are conducted in the United States, and all long-lived assets are located in the United States. Partnership operations consist of one reportable segment.

Certain Partnership businesses are subject to regulation by various authorities including, but not limited to the Federal Energy Regulatory Commission ("FERC"). Regulatory bodies exercise statutory authority over matters such as common carrier tariffs, construction, rates and ratemaking and agreements with customers.

Basis of Presentation

Condensed consolidated financial statements have been prepared under the rules and regulations of the Securities and Exchange Commission (“SEC”). These rules and regulations conform to the accounting principles contained in the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification, the single source of accounting principles generally accepted in the United States (“GAAP”).

Certain information and footnote disclosures normally included in the annual consolidated financial statements have been condensed or omitted from these condensed consolidated financial statements. The condensed consolidated financial statements as of June 30, 2020, and for the three and six months ended June 30, 2020 and 2019, included herein, are unaudited. These financial statements include all known accruals and adjustments necessary, in the opinion of management, for a fair presentation of our condensed consolidated financial position, results of operations and cash flows. Unless otherwise specified, all such adjustments are of a normal and recurring nature. The unaudited results of operations for the interim periods reported are not necessarily indicative of results to be expected for the full year. These unaudited condensed consolidated financial statements should be read in conjunction with our audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2019 (the "Partnership's 2019 10-K").

Partnership financial position, results of operations and cash flows consist of consolidated BP Midstream Partners LP activities and balances. All intercompany accounts and transactions within the financial statements have been eliminated for all periods presented.

Summary of Significant Accounting Policies

There have been no significant changes to accounting policies as disclosed in Note 2 - Summary of Significant Accounting Policies in the Partnership's 2019 10-K.

XML

Equity Method Investments

6 Months Ended

Jun. 30, 2020

Equity Method Investments and Joint Ventures [Abstract]

Equity Method Investments

Equity Method Investments We account for ownership interests in Mars, the Mardi Gras Joint Ventures, Ursa, and KM Phoenix using the equity method for financial reporting purposes. Financial results include the Partnership's proportionate share of Mars, the Mardi Gras Joint Ventures, Ursa and KM Phoenix, which is reflected in Income from equity method investments on the condensed consolidated statements of operations. We did not record any impairment loss on equity method investments during the three and six months ended June 30, 2020 and 2019.

The table below summarizes the balances and activities related for each equity method investment ("EMI") recorded as of and for the three and six months ended June 30, 2020 and 2019:

	Three Months Ended June 30, 2020							Three Months Ended June 30, 2019
	Percentage Ownership	Distributions Received		Income from EMI		Carrying Value		Percentage Ownership	Distributions Received		Income from EMI		Carrying Value
Mars	28.5%	$	(13.7)	$	11.6	$	54.3	28.5%	$	(13.7)	$	11.9	$	57.0
Caesar	56.0%	(3.4)		3.7		117.3		56.0%	(4.3)		4.5		119.5
Cleopatra	53.0%	(2.4)		1.2		115.5		53.0%	(3.2)		2.6		118.3
Proteus	65.0%	(5.2)		3.6		72.3		65.0%	(5.2)		3.3		77.7
Endymion	65.0%	(4.8)		5.2		81.5		65.0%	(4.5)		3.5		80.8
Others(1)	Various	(2.3)		1.5		85.6		Various	(2.9)		3.0		86.6
Total Equity Investments		$	(31.8)	$	26.8	$	526.5		$	(33.8)	$	28.8	$	539.9

	Six Months Ended June 30, 2020							Six Months Ended June 30, 2019
	Percentage Ownership	Distributions Received		Income from EMI		Carrying Value		Percentage Ownership	Distributions Received		Income from EMI		Carrying Value
Mars	28.5%	$	(26.7)	$	24.1	$	54.3	28.5%	$	(25.8)	$	23.7	$	57.0
Caesar	56.0%	(8.3)		8.2		117.3		56.0%	(9.7)		9.8		119.5
Cleopatra	53.0%	(5.3)		3.2		115.5		53.0%	(6.6)		5.4		118.3
Proteus	65.0%	(10.7)		7.7		72.3		65.0%	(7.5)		3.9		77.7
Endymion	65.0%	(10.7)		11.2		81.5		65.0%	(6.5)		4.7		80.8
Others(1)	Various	(4.3)		3.7		85.6		Various	(6.2)		5.7		86.6
Total Equity Investments		$	(66.0)	$	58.1	$	526.5		$	(62.3)	$	53.2	$	539.9

⁽¹⁾ Includes ownership in Ursa (22.7%) and KM Phoenix (25%).

The following table presents aggregated selected income statement data for equity method investments on a 100% basis for the three and six months ended June 30, 2020 and 2019:

	Three Months Ended June 30,
	2020		2019
Statement of operations
Revenue	$	127.0	$	148.1
Operating expenses	57.1		71.2
Net income	70.0		78.1

XML

Property, Plant and Equipment

6 Months Ended

Jun. 30, 2020

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment

Property, Plant and Equipment

Property, plant and equipment consisted of the following:

	June 30, 2020		December 31, 2019
Land	$	0.2	$	0.2
Right-of-way assets	1.4		1.4
Buildings and improvements	6.9		6.9
Pipelines and equipment	94.6		94.4
Other	0.5		0.5
Construction in progress	1.9		0.6
Property, plant and equipment	105.5		104.0
Less: Accumulated depreciation	(42.6)		(41.3)
Property, plant and equipment, net	$	62.9	$	62.7

There were no impairments on property, plant and equipment for the three and six months ended June 30, 2020. During the three and six months ended June 30, 2019, an impairment charge of $2.3 million was recorded under "Impairment and other, net" on our condensed consolidated statements of operations. See Note 10 - Commitments and Contingencies.

XML

Other Current Liabilities

6 Months Ended

Jun. 30, 2020

Payables and Accruals [Abstract]

Other Current Liabilities

Other Current Liabilities

Other current liabilities consisted of the following:

	June 30, 2020		December 31, 2019
Current portion of environmental remediation obligation	$	0.4	$	0.6
Current portion of lease liabilities	0.1		0.1
Accrued interest payable - related parties	1.6		4.2
Accrued liabilities	3.1		1.7
Other current liabilities	$	5.2	$	6.6

XML

Debt

6 Months Ended

Jun. 30, 2020

Debt Disclosure [Abstract]

Debt

Debt

On February 24, 2020, we entered into a $468 million Term Loan Facility Agreement ("term loan") with an affiliate of BP. On March 13, 2020, proceeds were used to repay outstanding borrowings under the existing credit facility. Please refer to Note 9 - Debt in the Partnership's 2019 10-K for further details. The term loan has a final repayment date of February 24, 2025, and provides for certain covenants, including the requirement to maintain a consolidated leverage ratio, which is calculated as total indebtedness to consolidated EBITDA, not to exceed 5.0 to 1.0, subject to a temporary increase in such ratio to 5.5 to 1.0 in connection with certain material acquisitions. Simultaneous with this transaction, we entered into the First Amendment to Short Term Credit Facility Agreement (the "First Amendment") whereby the lender added a provision that indebtedness under both the term loan and the credit facility shall not exceed $600 million. All other terms of the credit facility remain the same. As of June 30, 2020, the Partnership was in compliance with the covenants contained in the term loan facility and the credit facility.

There were $468 million of outstanding borrowings under the term loan at June 30, 2020, and $468 million under the credit facility at December 31, 2019. Interest charges and fees were $2.0 million and $5.6 million for the three and six months ended June 30, 2020, respectively. Interest charges and fees related to the credit facility were $4.1 million and $8.2 million for the three and six months ended June 30, 2019, respectively.

Indebtedness under the term loan bears interest at the 3-month LIBOR plus 0.73%. For the three and six months ended June 30, 2020, the weighted average interest rate for the term loan and the credit facility was 1.69% and 2.28%, respectively.

For the year ended December 31, 2019, the weighted average interest rate for the credit facility was 3.25%. The credit facility includes customary fees, including a commitment fee of 0.10% and a utilization fee of 0.20% per annum.

XML

Net Income Per Limited Partner Unit

6 Months Ended

Jun. 30, 2020

Earnings Per Share [Abstract]

Net Income Per Limited Partner Unit

Net Income Per Limited Partner Unit

The following table details the distributions declared and/or paid for the periods presented:

Three Months Ended	Date Paid or to be Paid	General Partner		Limited Partners' Common Units		Limited Partners' Subordinated Units		Total		Distributions per Limited Partner Unit (in dollars)
December 31, 2018	February 14, 2019	$	—	$	15.8	$	15.8	$	31.6	$	0.3015
March 31, 2019	May 15, 2019	0.2		16.4		16.4		33.0		0.3126
June 30, 2019	August 14, 2019	0.4		17.0		17.0		34.4		0.3237
December 31, 2019	February 13, 2020	1.2		18.2		18.2		37.6		0.3475
March 31, 2020	May 14, 2020	1.2		18.2		18.2		37.6		0.3475
June 30, 2020	August 13, 2020	1.2		18.2		18.2		37.6		0.3475

Earnings in excess of distributions are allocated to the limited partners based on their respective percentage interests. Payments made to the Partnership’s unitholders are determined in relation to actual distributions declared and are not based on the net income allocations used in the calculation of net income per unit.

In addition to the common and subordinated units, the Partnership also identified the incentive distribution rights ("IDRs") currently held by the General Partner as a participating security and uses the two-class method when calculating the net income per unit applicable to limited partners that is based on the weighted-average number of common units outstanding during the period.

When calculating basic earnings per unit under the two-class method for a master limited partnership, net income for the current reporting period is reduced by the amount of available cash that will be distributed to the General Partner and limited

partners for that reporting period. The following tables show the allocation of net income to arrive at net income per limited partner unit for the three and six months ended June 30, 2020 and 2019:

	Three Months Ended June 30,				Six Months Ended June 30,
	2020		2019		2020		2019
Net income attributable to the Partnership	$	40.6	$	37.3	$	82.3	$	74.5
Less:
Incentive distribution rights currently held by the General Partner	1.2		0.4		2.4		0.6
Limited partners' distribution declared on common units	18.2		17.0		36.4		33.4
Limited partners' distribution declared on subordinated units	18.2		17.0		36.4		33.4
Net income attributable to the Partnership in excess of distributions	$	3.0	$	2.9	$	7.1	$	7.1

	Three Months Ended June 30, 2020
	General Partner		Limited Partners' Common Units		Limited Partners' Subordinated Units		Total
Distributions declared	$	1.2	$	18.2	$	18.2	$	37.6
Net income attributable to the Partnership in excess of distributions	—		1.5		1.5		3.0
Net income attributable to the Partnership	$	1.2	$	19.7	$	19.7	$	40.6
Weighted average units outstanding:
Basic and Diluted			52.4		52.4		104.8
Net income per limited partner unit (in dollars):
Basic and Diluted			$	0.38	$	0.38

	Six Months Ended June 30, 2020
	General Partner		Limited Partners' Common Units		Limited Partners' Subordinated Units		Total
Distributions declared	$	2.4	$	36.4	$	36.4	$	75.2
Net income attributable to the Partnership in excess of distributions	—		3.6		3.5		7.1
Net income attributable to the Partnership	$	2.4	$	40.0	$	39.9	$	82.3
Weighted average units outstanding:
Basic and Diluted			52.4		52.4		104.8
Net income per limited partner unit (in dollars):
Basic and Diluted			$	0.77	$	0.77

	Three Months Ended June 30, 2019
	General Partner		Limited Partners' Common Units		Limited Partners' Subordinated Units		Total
Distributions declared	$	0.4	$	17.0	$	17.0	$	34.4
Net income attributable to the Partnership in excess of distributions	—		1.5		1.4		2.9
Net income attributable to the Partnership	$	0.4	$	18.5	$	18.4	$	37.3
Weighted average units outstanding:
Basic and Diluted			52.4		52.4		104.8
Net income per limited partner unit (in dollars):
Basic and Diluted			$	0.35	$	0.35

XML

Fair Value Measurements

6 Months Ended

Jun. 30, 2020

Fair Value Disclosures [Abstract]

Fair Value Measurements

Fair Value Measurements

The carrying amounts of accounts receivable, accounts payable, and accrued liabilities approximate their fair values due to their short-term nature.

The carrying value of borrowings under the term loan as of June 30, 2020, and the credit facility as of December 31, 2019, approximate fair value as the interest rates are reflective of market rates.

XML

Commitments and Contingencies

6 Months Ended

Jun. 30, 2020

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

Legal Proceedings

The Partnership is a party to ongoing legal proceedings in the ordinary course of business. For each outstanding legal matter, if any, we will evaluate the merits of the case, exposure to the matter, possible legal or settlement strategies and the likelihood of an unfavorable outcome. While the outcome of these proceedings cannot be predicted with certainty, we do not believe the results of these proceedings, individually or in the aggregate, will have a material adverse effect on the Partnership's business, financial condition, results of operations or liquidity.

Indemnification

Under an omnibus agreement, our Parent will indemnify us for certain environmental liabilities, litigation and other matters attributable to the ownership or operation of assets prior to Partnership ownership. For the purposes of determining the indemnified amount of any loss suffered or incurred by the Partnership, the Partnership’s ownership of 28.5% in Mars, and 65% in Mardi Gras, and Mardi Gras’ 56% ownership in Caesar, 53% ownership in Cleopatra, 65% ownership in Endymion and 65% ownership in Proteus will be considered. Indemnification for certain identified environmental liabilities is subject to a cap of $25 million without any deductible. Other matters covered by the omnibus agreement are subject to a cap of $15 million and an

aggregate deductible of $0.5 million before we are entitled to indemnification. Indemnification for any unknown environmental liabilities is limited to liabilities due to occurrences prior to the closing of the Initial Public Offering ("IPO") and that are identified before the third anniversary of the closing of the IPO.

The Interest Purchase Agreement contains customary representations, warranties and covenants of our Parent and the Partnership. Our Parent, on the one hand, and the Partnership, on the other hand, have agreed to indemnify each other and their respective affiliates, officers, directors and other representatives against certain losses, including those resulting from any breach of their representations, warranties or covenants contained in the Interest Purchase Agreement, subject to certain limitations and survival periods. This agreement covers the Partnership’s ownership of 22.7% in Ursa and 25% in KM Phoenix.

Environmental Matters

We are subject to federal, state, and local environmental laws and regulations. We record provisions for environmental liabilities based on management’s best estimates, using all information that is available at the time. In making environmental liability estimations, we consider the material effect of environmental compliance, pending legal actions against us and potential third-party liability claims. Often, as the remediation evaluation and effort progress, additional information is obtained, requiring revisions to estimated costs. We are indemnified by our Parent under the omnibus agreement against environmental cleanup costs for incidents that occurred prior to Partnership ownership. Revisions to the estimated environmental liability for conditions that are not indemnified under the omnibus agreement with our Parent are reflected in the Partnership's condensed consolidated statements of operations in the year in which they are probable and reasonably estimable.

We accrued $3.6 million and $3.7 million for environmental liabilities at June 30, 2020 and December 31, 2019, respectively. These balances are broken down on the condensed consolidated balance sheets as follows:

	Balance sheet location	June 30, 2020		December 31, 2019
Current portion of environmental remediation obligations	Other current liabilities	$	0.4	$	0.6
Long-term portion of environmental remediation obligations	Other liabilities	3.2		3.1
Total		$	3.6	$	3.7

The balances are related to incidents that occurred prior to our ownership and are entirely indemnified by our Parent. As a result, we recorded corresponding indemnification assets $3.6 million and $3.7 million at June 30, 2020 and December 31, 2019, respectively. These balances are broken down on the condensed consolidated balance sheets as follows:

	Balance sheet location	June 30, 2020		December 31, 2019
Current portion of indemnification assets	Other current assets	$	0.4	$	0.6
Non-current portion of indemnification assets	Other assets	3.2		3.1
Total		$	3.6	$	3.7

Griffith Station Incident

XML

Unit-Based Compensation

3 Months Ended

Jun. 30, 2020

Share-based Payment Arrangement [Abstract]

Unit-Based Compensation

11. Unit-Based Compensation

Long-Term Incentive Plan

On October 26, 2017, the General Partner adopted the BP Midstream Partners LP 2017 Long Term Incentive Plan (the “LTIP”). Awards under the LTIP are available for eligible officers, directors, employees and consultants of the General Partner and its affiliates, who perform services for the Partnership. The LTIP allows the Partnership to grant unit options, unit appreciation rights, restricted units, phantom units, unit awards, cash awards, performance awards, distribution equivalent rights, substitute awards and other unit-based awards. The maximum aggregate number of common units that may be issued pursuant to the awards granted under the LTIP shall not exceed 5,502,271, subject to proportionate adjustment in the event of unit splits and similar events.

Unit-Based Awards under the LTIP

The following is a summary of phantom unit award activities of the Partnership’s common units for the six months ended June 30, 2020:

	Phantom Units
	Number of Units (in units)	Weighted Average Grant Date Fair Value per Unit (in dollars)
Outstanding at December 31, 2019	15,227	$	16.64
Granted	16,038	14.03
Vested	(15,227)	16.64
Outstanding at June 30, 2020	16,038	$	14.03

For the three and six months ended June 30, 2020, total compensation expense recognized for phantom unit awards were approximately $56 thousand and $119 thousand, respectively. For the three and six months ended June 30, 2019, total compensation expense recognized for phantom unit awards was approximately $71 thousand and $111 thousand, respectively. The unrecognized compensation cost related to phantom unit awards was approximately $147 thousand at June 30, 2020, which is expected to be recognized over a weighted average period of 0.7 years.

XML

Variable Interest Entity

3 Months Ended

Jun. 30, 2020

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Variable Interest Entity

12. Variable Interest Entity

Mardi Gras is a Delaware limited liability company and a pass-through entity for U.S. federal and state income tax purposes. Mardi Gras holds equity interests in the Mardi Gras Joint Ventures and accounts for them as equity method investments. Mardi Gras does not have any other operations or activities. The remaining interests in each of the Mardi Gras Joint Ventures are owned by unaffiliated third-party investors. Each of the Mardi Gras Joint Ventures is managed by its respective management committee, and decisions made by these management committees require approval of two or more members that are not affiliates with equity interest holdings meeting certain thresholds.

We have 65% ownership interest and 100% managing member interest in Mardi Gras. The remainder of the economic interest in Mardi Gras was held 34% by BP Pipelines and 1% by an affiliate of BP. Through our managing member interest in Mardi Gras, we have the right to vote 100% of Mardi Gras’ interest in each of the Mardi Gras Joint Ventures. We determined that Mardi Gras is a variable interest entity because (i) we hold disproportional voting rights as compared to our economic interest in Mardi Gras, and (ii) substantially all of Mardi Gras’ activities involve or are conducted on behalf of our Parent, which holds disproportionately few voting rights.

The managing member interest in Mardi Gras provides us with the unilateral power to direct the activities of Mardi Gras that most significantly impact its economic performance including the right to exercise the voting rights of BP for each of the Mardi Gras Joint Ventures. In addition, our obligations to absorb the expected losses of and the right to receive the residual returns from Mardi Gras relative to our economic ownership is significant to Mardi Gras. As a result, we are the primary beneficiary of Mardi Gras and consolidate Mardi Gras.

We have the obligation to provide financial support to Mardi Gras if all members unanimously determine that additional capital contributions are necessary to fund Mardi Gras’ operations. The assets of Mardi Gras can only be used to satisfy its own

obligations, which were zero at June 30, 2020 and December 31, 2019. Under the current limited liability company agreement of Mardi Gras, creditors of Mardi Gras, if any, do not have any recourse to the general credit of the Partnership.

The financial position of Mardi Gras at June 30, 2020 and December 31, 2019, its financial performance for the three and six months ended June 30, 2020 and 2019 and cash flows for the six months ended June 30, 2020 and 2019, as reflected in the condensed consolidated financial statements, are as follows:

	June 30, 2020		December 31, 2019
Balance sheet
Equity method investments	$	386.6	$	391.3
Non-controlling interests	135.3		136.9

	Three Months Ended June 30,				Six Months Ended June 30,
	2020		2019		2020		2019
Statement of operations
Income from equity method investments	$	13.7	$	13.9	$	30.3	$	23.8
Less: Net income attributable to non-controlling interests	4.8		4.8		10.6		8.3
Net impact on Net income attributable to the Partnership	$	8.9	$	9.1	$	19.7	$	15.5

	Six Months Ended June 30,
	2020		2019
Statement of cash flows
Cash flows from operating activities
Distributions of earnings received from equity method investments	$	29.8	$	23.7
Cash flows from investing activities
Distribution in excess of earnings from equity method investments	5.2		6.6
Cash flows from financing activities
Distributions to non-controlling interests	(12.2)		(10.6)
Net change on the Partnership's cash and cash equivalents	$	22.8	$	19.7

XML

Subsequent Events

6 Months Ended

Jun. 30, 2020

Subsequent Events [Abstract]

Subsequent Events

Subsequent Events

We have evaluated subsequent events through the issuance of these condensed consolidated financial statements. Based on this evaluation, it was determined that no subsequent events occurred, other than the distribution noted below, that require recognition or disclosure in the condensed consolidated financial statements.

Distribution

On July 15, 2020, we declared a cash distribution of $0.3475 per limited partner unit to unitholders of record on July 30, 2020, for the three months ended June 30, 2020. The distribution, combined with distributions to our General Partner, will be paid on August 13, 2020, and will total $37.6 million, with $16.6 million distributed to our non-affiliated common unitholders, and $21.0 million, including $1.2 million for IDRs distributed to our Parent in respect of its ownership of our common units, subordinated units and

XML

Business and Basis of Presentation (Policies)

6 Months Ended

Jun. 30, 2020

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of Presentation

Basis of Presentation

Condensed consolidated financial statements have been prepared under the rules and regulations of the Securities and Exchange Commission (“SEC”). These rules and regulations conform to the accounting principles contained in the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification, the single source of accounting principles generally accepted in the United States (“GAAP”).

Certain information and footnote disclosures normally included in the annual consolidated financial statements have been condensed or omitted from these condensed consolidated financial statements. The condensed consolidated financial statements as of June 30, 2020, and for the three and six months ended June 30, 2020 and 2019, included herein, are unaudited. These financial statements include all known accruals and adjustments necessary, in the opinion of management, for a fair presentation of our condensed consolidated financial position, results of operations and cash flows. Unless otherwise specified, all such adjustments are of a normal and recurring nature. The unaudited results of operations for the interim periods reported are not necessarily indicative of results to be expected for the full year. These unaudited condensed consolidated financial statements should be read in conjunction with our audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2019 (the "Partnership's 2019 10-K").

Partnership financial position, results of operations and cash flows consist of consolidated BP Midstream Partners LP activities and balances. All intercompany accounts and transactions within the financial statements have been eliminated for all periods presented.

XML

Revenue Recognition (Tables)

6 Months Ended

Jun. 30, 2020

Revenue from Contract with Customer [Abstract]

Disaggregation of Revenue

The following table provides information about disaggregated revenue:

	Three Months Ended June 30,				Six Months Ended June 30,
	2020		2019		2020		2019
Transportation services revenue - third parties	$	0.8	$	0.7	$	1.8	$	1.5
Transportation services revenue - related parties	30.7		27.9		60.4		57.3
Total revenue	$	31.5	$	28.6	$	62.2	$	58.8

Summary of Remaining Performance Obligation, Expected Timing of Satisfaction

The fixed portion of existing customer contracts are summarized in the future performance obligations as of June 30, 2020. The unfulfilled performance obligations included in the table below are expected to be recognized in revenue in the specified periods:

	As of June 30, 2020
Remainder of 2020	$	63.9
2021	1.7
Total	$	65.6

Summary of Contract with Customer, Assets and Liabilities

The following table provides information about receivables from contracts with customers, contract assets and contract liabilities:

	June 30, 2020		December 31, 2019
Receivables from contracts with customers - third parties	$	0.2	$	0.6
Receivables from contracts with customers - related parties	10.7		11.3
Deferred revenue and credits - related parties	1.6		1.5

XML

Equity Method Investments (Tables)

6 Months Ended

Jun. 30, 2020

Equity Method Investments and Joint Ventures [Abstract]

Schedule of Equity Method Investments

The table below summarizes the balances and activities related for each equity method investment ("EMI") recorded as of and for the three and six months ended June 30, 2020 and 2019:

	Three Months Ended June 30, 2020							Three Months Ended June 30, 2019
	Percentage Ownership	Distributions Received		Income from EMI		Carrying Value		Percentage Ownership	Distributions Received		Income from EMI		Carrying Value
Mars	28.5%	$	(13.7)	$	11.6	$	54.3	28.5%	$	(13.7)	$	11.9	$	57.0
Caesar	56.0%	(3.4)		3.7		117.3		56.0%	(4.3)		4.5		119.5
Cleopatra	53.0%	(2.4)		1.2		115.5		53.0%	(3.2)		2.6		118.3
Proteus	65.0%	(5.2)		3.6		72.3		65.0%	(5.2)		3.3		77.7
Endymion	65.0%	(4.8)		5.2		81.5		65.0%	(4.5)		3.5		80.8
Others(1)	Various	(2.3)		1.5		85.6		Various	(2.9)		3.0		86.6
Total Equity Investments		$	(31.8)	$	26.8	$	526.5		$	(33.8)	$	28.8	$	539.9

	Six Months Ended June 30, 2020							Six Months Ended June 30, 2019
	Percentage Ownership	Distributions Received		Income from EMI		Carrying Value		Percentage Ownership	Distributions Received		Income from EMI		Carrying Value
Mars	28.5%	$	(26.7)	$	24.1	$	54.3	28.5%	$	(25.8)	$	23.7	$	57.0
Caesar	56.0%	(8.3)		8.2		117.3		56.0%	(9.7)		9.8		119.5
Cleopatra	53.0%	(5.3)		3.2		115.5		53.0%	(6.6)		5.4		118.3
Proteus	65.0%	(10.7)		7.7		72.3		65.0%	(7.5)		3.9		77.7
Endymion	65.0%	(10.7)		11.2		81.5		65.0%	(6.5)		4.7		80.8
Others(1)	Various	(4.3)		3.7		85.6		Various	(6.2)		5.7		86.6
Total Equity Investments		$	(66.0)	$	58.1	$	526.5		$	(62.3)	$	53.2	$	539.9

⁽¹⁾ Includes ownership in Ursa (22.7%) and KM Phoenix (25%).

The following table presents aggregated selected income statement data for equity method investments on a 100% basis for the three and six months ended June 30, 2020 and 2019:

	Three Months Ended June 30,
	2020		2019
Statement of operations
Revenue	$	127.0	$	148.1
Operating expenses	57.1		71.2
Net income	70.0		78.1

XML

Property, Plant and Equipment (Tables)

6 Months Ended

Jun. 30, 2020

Property, Plant and Equipment [Abstract]

Components of Property, Plant and Equipment

Property, plant and equipment consisted of the following:

	June 30, 2020		December 31, 2019
Land	$	0.2	$	0.2
Right-of-way assets	1.4		1.4
Buildings and improvements	6.9		6.9
Pipelines and equipment	94.6		94.4
Other	0.5		0.5
Construction in progress	1.9		0.6
Property, plant and equipment	105.5		104.0
Less: Accumulated depreciation	(42.6)		(41.3)
Property, plant and equipment, net	$	62.9	$	62.7

XML

Other Current Liabilities (Tables)

6 Months Ended

Jun. 30, 2020

Payables and Accruals [Abstract]

Schedule of Other Current Liabilities

Other current liabilities consisted of the following:

	June 30, 2020		December 31, 2019
Current portion of environmental remediation obligation	$	0.4	$	0.6
Current portion of lease liabilities	0.1		0.1
Accrued interest payable - related parties	1.6		4.2
Accrued liabilities	3.1		1.7
Other current liabilities	$	5.2	$	6.6

XML

Related Party Transactions (Tables)

6 Months Ended

Jun. 30, 2020

Related Party Transactions [Abstract]

Schedule of Related Party Transactions

For the three and six months ended June 30, 2020 and 2019, we recorded the following amounts for related party expenses, which also included the expenses related to share-based compensation discussed below:

	Three Months Ended June 30,				Six Months Ended June 30,
	2020		2019		2020		2019
Operating expenses—related parties	$	1.3	$	1.4	$	2.8	$	2.9
Maintenance expenses—related parties	0.1		0.1		0.2		0.1
General and administrative—related parties	3.6		3.7		7.5		7.1
Total costs and expenses—related parties	$	5.0	$	5.2	$	10.5	$	10.1

XML

Net Income Per Limited Partner Unit (Tables)

6 Months Ended

Jun. 30, 2020

Earnings Per Share [Abstract]

Schedule of Distributions

The following table details the distributions declared and/or paid for the periods presented:

Three Months Ended	Date Paid or to be Paid	General Partner		Limited Partners' Common Units		Limited Partners' Subordinated Units		Total		Distributions per Limited Partner Unit (in dollars)
December 31, 2018	February 14, 2019	$	—	$	15.8	$	15.8	$	31.6	$	0.3015
March 31, 2019	May 15, 2019	0.2		16.4		16.4		33.0		0.3126
June 30, 2019	August 14, 2019	0.4		17.0		17.0		34.4		0.3237
December 31, 2019	February 13, 2020	1.2		18.2		18.2		37.6		0.3475
March 31, 2020	May 14, 2020	1.2		18.2		18.2		37.6		0.3475
June 30, 2020	August 13, 2020	1.2		18.2		18.2		37.6		0.3475

Schedule of Earnings Per Share

The following tables show the allocation of net income to arrive at net income per limited partner unit for the three and six months ended June 30, 2020 and 2019:

	Three Months Ended June 30,				Six Months Ended June 30,
	2020		2019		2020		2019
Net income attributable to the Partnership	$	40.6	$	37.3	$	82.3	$	74.5
Less:
Incentive distribution rights currently held by the General Partner	1.2		0.4		2.4		0.6
Limited partners' distribution declared on common units	18.2		17.0		36.4		33.4
Limited partners' distribution declared on subordinated units	18.2		17.0		36.4		33.4
Net income attributable to the Partnership in excess of distributions	$	3.0	$	2.9	$	7.1	$	7.1

	Three Months Ended June 30, 2020
	General Partner		Limited Partners' Common Units		Limited Partners' Subordinated Units		Total
Distributions declared	$	1.2	$	18.2	$	18.2	$	37.6
Net income attributable to the Partnership in excess of distributions	—		1.5		1.5		3.0
Net income attributable to the Partnership	$	1.2	$	19.7	$	19.7	$	40.6
Weighted average units outstanding:
Basic and Diluted			52.4		52.4		104.8
Net income per limited partner unit (in dollars):
Basic and Diluted			$	0.38	$	0.38

	Six Months Ended June 30, 2020
	General Partner		Limited Partners' Common Units		Limited Partners' Subordinated Units		Total
Distributions declared	$	2.4	$	36.4	$	36.4	$	75.2
Net income attributable to the Partnership in excess of distributions	—		3.6		3.5		7.1
Net income attributable to the Partnership	$	2.4	$	40.0	$	39.9	$	82.3
Weighted average units outstanding:
Basic and Diluted			52.4		52.4		104.8
Net income per limited partner unit (in dollars):
Basic and Diluted			$	0.77	$	0.77

	Three Months Ended June 30, 2019
	General Partner		Limited Partners' Common Units		Limited Partners' Subordinated Units		Total
Distributions declared	$	0.4	$	17.0	$	17.0	$	34.4
Net income attributable to the Partnership in excess of distributions	—		1.5		1.4		2.9
Net income attributable to the Partnership	$	0.4	$	18.5	$	18.4	$	37.3
Weighted average units outstanding:
Basic and Diluted			52.4		52.4		104.8
Net income per limited partner unit (in dollars):
Basic and Diluted			$	0.35	$	0.35

XML

Commitments and Contingencies (Tables)

6 Months Ended

Jun. 30, 2020

Commitments and Contingencies Disclosure [Abstract]

Summary of Balance Sheet Classification of Environmental Liabilities

These balances are broken down on the condensed consolidated balance sheets as follows:

	Balance sheet location	June 30, 2020		December 31, 2019
Current portion of environmental remediation obligations	Other current liabilities	$	0.4	$	0.6
Long-term portion of environmental remediation obligations	Other liabilities	3.2		3.1
Total		$	3.6	$	3.7

Schedule Of Indemnification Asset For Environmental Loss Contingencies

These balances are broken down on the condensed consolidated balance sheets as follows:

	Balance sheet location	June 30, 2020		December 31, 2019
Current portion of indemnification assets	Other current assets	$	0.4	$	0.6
Non-current portion of indemnification assets	Other assets	3.2		3.1
Total		$	3.6	$	3.7

XML

Unit-Based Compensation (Tables)

6 Months Ended

Jun. 30, 2020

Share-based Payment Arrangement [Abstract]

Phantom Units Activity

The following is a summary of phantom unit award activities of the Partnership’s common units for the six months ended June 30, 2020:

	Phantom Units
	Number of Units (in units)	Weighted Average Grant Date Fair Value per Unit (in dollars)
Outstanding at December 31, 2019	15,227	$	16.64
Granted	16,038	14.03
Vested	(15,227)	16.64
Outstanding at June 30, 2020	16,038	$	14.03

XML

Variable Interest Entity (Tables)

6 Months Ended

Jun. 30, 2020

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Schedule of Variable Interest Entity

The financial position of Mardi Gras at June 30, 2020 and December 31, 2019, its financial performance for the three and six months ended June 30, 2020 and 2019 and cash flows for the six months ended June 30, 2020 and 2019, as reflected in the condensed consolidated financial statements, are as follows:

	June 30, 2020		December 31, 2019
Balance sheet
Equity method investments	$	386.6	$	391.3
Non-controlling interests	135.3		136.9

	Three Months Ended June 30,				Six Months Ended June 30,
	2020		2019		2020		2019
Statement of operations
Income from equity method investments	$	13.7	$	13.9	$	30.3	$	23.8
Less: Net income attributable to non-controlling interests	4.8		4.8		10.6		8.3
Net impact on Net income attributable to the Partnership	$	8.9	$	9.1	$	19.7	$	15.5

	Six Months Ended June 30,
	2020		2019
Statement of cash flows
Cash flows from operating activities
Distributions of earnings received from equity method investments	$	29.8	$	23.7
Cash flows from investing activities
Distribution in excess of earnings from equity method investments	5.2		6.6
Cash flows from financing activities
Distributions to non-controlling interests	(12.2)		(10.6)
Net change on the Partnership's cash and cash equivalents	$	22.8	$	19.7

XML

Business and Basis of Presentation (Details) - segment	6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019
Variable Interest Entity [Line Items]
Number of reportable segments	1
KM Phoenix
Variable Interest Entity [Line Items]
Equity Method Investment, Ownership Percentage	25.00%
Total Mardi Gras Joint Ventures
Variable Interest Entity [Line Items]
Equity Method Investment, Ownership Percentage	65.00%
KM Phoenix
Variable Interest Entity [Line Items]
Equity Method Investment, Ownership Percentage	25.00%
Ursa
Variable Interest Entity [Line Items]
Equity Method Investment, Ownership Percentage	22.70%
Mars
Variable Interest Entity [Line Items]
Equity Method Investment, Ownership Percentage	28.50%	28500000.00%
Caesar
Variable Interest Entity [Line Items]
Equity Method Investment, Ownership Percentage	56.00%	56000000.00%
Cleopatra
Variable Interest Entity [Line Items]
Equity Method Investment, Ownership Percentage	53.00%	53000000.00%
Proteus
Variable Interest Entity [Line Items]
Equity Method Investment, Ownership Percentage	65.00%	65000000.00%
Endymion
Variable Interest Entity [Line Items]
Equity Method Investment, Ownership Percentage	65.00%	65000000.00%

XML

Revenue Recognition - Narrative (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Revenue from Contract with Customer [Abstract]
Income related to FLA arrangements with Parent	$ 800,000	$ 2,600,000	$ 2,300,000	$ 5,100,000
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Income related to FLA arrangements with Parent	800,000	2,600,000	2,300,000	5,100,000
Related parties	30,700,000	27,900,000		57,300,000
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Income related to FLA arrangements with Parent	800,000	2,600,000	2,300,000	5,100,000
Disaggregation of Revenue [Line Items]
Income related to FLA arrangements with Parent	$ 800,000	$ 2,600,000	$ 2,300,000	$ 5,100,000

XML

Revenue Recognition - Disaggregation of Revenue (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Revenue from Contract with Customer [Abstract]
Transportation services revenue - third parties	$ 0.8	$ 0.7	$ 1.8	$ 1.5
Transportation services revenue - related parties	30.7	27.9		57.3
Total revenue	$ 31.5	$ 28.6	$ 62.2	$ 58.8

XML

Revenue Recognition - Remaining Performance Obligation, Expected Timing of Satisfaction (Details) $ in Millions	Jun. 30, 2020 USD ($)
Revenue from Contract with Customer [Abstract]
Unfulfilled performance obligations	$ 65.6
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-10-01
Revenue from Contract with Customer [Abstract]
Unfulfilled performance obligations	63.9
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-01-01
Revenue from Contract with Customer [Abstract]
Unfulfilled performance obligations	$ 1.7
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	1 year

XML

Revenue Recognition - Contract with Customer, Assets and Liabilities (Details) - USD ($) $ in Millions	Jun. 30, 2020	Dec. 31, 2019
Accounts, Notes, Loans and Financing Receivable [Line Items]
Receivables from contracts with customers	$ 0.2	$ 0.6
Third parties
Accounts, Notes, Loans and Financing Receivable [Line Items]
Receivables from contracts with customers	0.2	0.6
Related parties
Accounts, Notes, Loans and Financing Receivable [Line Items]
Receivables from contracts with customers	10.7	11.3
Deferred revenue and credits	$ 1.6	$ 1.5

XML

Equity Method Investments - Narrative (Details) - USD ($)	6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019
Equity Method Investments and Joint Ventures [Abstract]
Impairment loss on equity method investments	$ 0	$ 0

XML

Equity Method Investments - Schedule of Equity Method Investments (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019	Dec. 31, 2019
Equity Method Investment, Financial Statement, Reported Amounts [Abstract]
Proceeds From Equity Method Investment, Dividends Or Distributions, Return On Capital And Return Of Capital	$ 31,800	$ 33,800	$ 66,000	$ 62,300
Income from equity method investments	26,800	28,800	58,100	53,200
Equity method investments	526,500	539,900	526,500	539,900	$ 534,400
Equity Method Investment, Summarized Financial Information, Income Statement [Abstract]
Revenues	127,000	148,100	271,600	264,100
Operating expenses	57,100	71,200	121,400	117,000
Net income	$ 70,000	$ 78,100	$ 150,500	$ 148,400
Mars
Equity Method Investment, Financial Statement, Reported Amounts [Abstract]
Equity Method Investment, Ownership Percentage	28.50%	28500000.00%	28.50%	28500000.00%
Proceeds From Equity Method Investment, Dividends Or Distributions, Return On Capital And Return Of Capital	$ 13,700	$ 13,700	$ 26,700	$ 25,800
Income from equity method investments	11,600	11,900	24,100	23,700
Equity method investments	$ 54,300	$ 57,000	$ 54,300	$ 57,000
Caesar
Equity Method Investment, Financial Statement, Reported Amounts [Abstract]
Equity Method Investment, Ownership Percentage	56.00%	56000000.00%	56.00%	56000000.00%
Proceeds From Equity Method Investment, Dividends Or Distributions, Return On Capital And Return Of Capital	$ 3,400	$ 4,300	$ 8,300	$ 9,700
Income from equity method investments	3,700	4,500	8,200	9,800
Equity method investments	$ 117,300	$ 119,500	$ 117,300	$ 119,500
Cleopatra
Equity Method Investment, Financial Statement, Reported Amounts [Abstract]
Equity Method Investment, Ownership Percentage	53.00%	53000000.00%	53.00%	53000000.00%
Proceeds From Equity Method Investment, Dividends Or Distributions, Return On Capital And Return Of Capital	$ 2,400	$ 3,200	$ 5,300	$ 6,600
Income from equity method investments	1,200	2,600	3,200	5,400
Equity method investments	$ 115,500	$ 118,300	$ 115,500	$ 118,300
Proteus
Equity Method Investment, Financial Statement, Reported Amounts [Abstract]
Equity Method Investment, Ownership Percentage	65.00%	65000000.00%	65.00%	65000000.00%
Proceeds From Equity Method Investment, Dividends Or Distributions, Return On Capital And Return Of Capital	$ 5,200	$ 5,200	$ 10,700	$ 7,500
Income from equity method investments	3,600	3,300	7,700	3,900
Equity method investments	$ 72,300	$ 77,700	$ 72,300	$ 77,700
Endymion
Equity Method Investment, Financial Statement, Reported Amounts [Abstract]
Equity Method Investment, Ownership Percentage	65.00%	65000000.00%	65.00%	65000000.00%
Proceeds From Equity Method Investment, Dividends Or Distributions, Return On Capital And Return Of Capital	$ 4,800	$ 4,500	$ 10,700	$ 6,500
Income from equity method investments	5,200	3,500	11,200	4,700
Equity method investments	81,500	80,800	81,500	80,800
Others
Equity Method Investment, Financial Statement, Reported Amounts [Abstract]
Proceeds From Equity Method Investment, Dividends Or Distributions, Return On Capital And Return Of Capital	2,300	2,900	4,300	6,200
Income from equity method investments	1,500	3,000	3,700	5,700
Equity method investments	$ 85,600	$ 86,600	$ 85,600	$ 86,600
Total Mardi Gras Joint Ventures
Equity Method Investment, Financial Statement, Reported Amounts [Abstract]
Equity Method Investment, Ownership Percentage	65.00%		65.00%
Ursa
Equity Method Investment, Financial Statement, Reported Amounts [Abstract]
Equity Method Investment, Ownership Percentage	22.70%		22.70%
KM Phoenix
Equity Method Investment, Financial Statement, Reported Amounts [Abstract]
Equity Method Investment, Ownership Percentage	25.00%		25.00%

XML

Property, Plant and Equipment (Details) - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Dec. 31, 2019
Property, Plant and Equipment [Line Items]
Property, plant and equipment	$ 105,500		$ 104,000
Less: Accumulated depreciation	(42,600)		(41,300)
Property, plant and equipment, net	62,900		62,700
Impairment charge	0	$ 2,300
Land
Property, Plant and Equipment [Line Items]
Property, plant and equipment	200		200
Rights-of-way
Property, Plant and Equipment [Line Items]
Property, plant and equipment	1,400		1,400
Building and improvements
Property, Plant and Equipment [Line Items]
Property, plant and equipment	6,900		6,900
Pipeline and equipment
Property, Plant and Equipment [Line Items]
Property, plant and equipment	94,600		94,400
Other
Property, Plant and Equipment [Line Items]
Property, plant and equipment	500		500
Construction in progress
Property, Plant and Equipment [Line Items]
Property, plant and equipment	$ 1,900		$ 600

XML

Other Current Liabilities (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
Payables and Accruals [Abstract]
Current portion of environmental remediation obligations	$ 400	$ 600
Current portion of lease liabilities	100	100
Accrued interest payable - related parties	1,600	4,200
Accrued liabilities	3,100	1,700
Other current liabilities	$ 5,200	$ 6,600

XML

Debt (Details)	3 Months Ended		6 Months Ended
	Jun. 30, 2020 USD ($)	Jun. 30, 2019 USD ($)	Jun. 30, 2020 USD ($)	Jun. 30, 2019	Dec. 31, 2019 USD ($)
Line of Credit Facility [Line Items]
Weighted average interest rate			2.28%
Long-term Debt, Gross	$ 468		$ 468
Required consolidated leverage ratio	5.0		5.0
Required consolidated leverage ratio temporary 1	5.5		5.5
Debt maximum borrowing capacity	$ 600		$ 600
Balance spread on variable rate	73.00%
Long-term Debt [Member]
Line of Credit Facility [Line Items]
Weighted average interest rate			169.00%
Domestic Line of Credit [Member]
Line of Credit Facility [Line Items]
Weighted average interest rate				3.25%
Line of Credit | Revolving Credit Facility
Line of Credit Facility [Line Items]
Outstanding borrowing	$ 468,000,000		$ 468,000,000		$ 468,000,000
Interest expense	$ 2,000,000.0	$ 4,100,000	$ 5,600,000
Commitment fee percentage			0.10%
Utilization fee percentage			0.20%

XML

Related Party Transactions - Narrative (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019	Dec. 31, 2019
Related Party Transaction [Line Items]
Related parties	$ 30,700,000	$ 27,900,000		$ 57,300,000
Deferred revenue and credits	1,600,000		$ 1,600,000		$ 1,500,000
BP Pipelines
Related Party Transaction [Line Items]
Annual fee paid to related party	$ 15,200,000	13,600,000
Total Mardi Gras Joint Ventures
Related Party Transaction [Line Items]
Noncontrolling interest, ownership percentage by Parent	3500.00%		3500.00%
Parent
Related Party Transaction [Line Items]
Performance or restricted period			3 years
Parent [Member]
Related Party Transaction [Line Items]
Performance or restricted period	3 years
BP Products
Related Party Transaction [Line Items]
Deficiency revenue	$ 6,000,000.0	$ 0	$ 6,000,000.0	$ 0.0

XML

Related Party Transactions - Schedule of Related Party Transactions (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Related Party Transactions [Abstract]
Operating expenses—related parties	$ 1,300,000	$ 1,400,000	$ 2,800,000	$ 2,900,000
Maintenance expenses—related parties	100,000	100,000	200,000	100,000
General and administrative—related parties	3,600,000	3,700,000	7,500,000	7,100,000
Total costs and expenses—related parties	5,000,000.0	5,200,000	10,500,000	10,100,000
BP Products
Related Party Transaction [Line Items]
Deficiency revenue	$ 6,000,000.0	$ 0	$ 6,000,000.0	$ 0.0

XML

Net Income Per Limited Partner Unit - Schedule of Distributions (Details) - USD ($) $ / shares in Units, $ in Thousands				3 Months Ended		6 Months Ended
	Aug. 13, 2020	Aug. 14, 2019	May 15, 2019	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Distribution Made to Limited Partner [Line Items]
Partner distributions declared		$ 34,400	$ 33,000	$ 37,600	$ 34,400	$ 75,200	$ 67,400
Dividends declared per share (in dollars per share)		$ 0.3237	$ 0.3126
General Partner
Distribution Made to Limited Partner [Line Items]
Partner distributions declared		$ 400	$ 200	1,200	400	2,400	600
Limited Partners Common Units
Distribution Made to Limited Partner [Line Items]
Partner distributions declared		17,000	16,400	18,200	17,000	36,400	33,400
Limited Partners Subordinated Units
Distribution Made to Limited Partner [Line Items]
Partner distributions declared		$ 17,000	$ 16,400	$ 18,200	$ 17,000	$ 36,400	$ 33,400
Subsequent Event
Distribution Made to Limited Partner [Line Items]
Dividends declared per share (in dollars per share)	$ 0.3475

XML

Net Income Per Limited Partner Unit - Schedule of Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands, shares in Millions			3 Months Ended		6 Months Ended
	Aug. 14, 2019	May 15, 2019	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Partner distributions declared	$ 34,400	$ 33,000	$ 37,600	$ 34,400	$ 75,200	$ 67,400
Net income attributable to the Partnership in excess of distributions			3,000	2,900	7,100	7,100
Net income attributable to the Partnership			$ 40,600	$ 37,300	$ 82,300	$ 74,500
Weighted average units outstanding:
Basic and Diluted (in shares)			104.8	104.8	104.8	104.8
Incentive distribution rights currently held by the General Partner
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Partner distributions declared	400	200	$ 1,200	$ 400	$ 2,400	$ 600
Net income attributable to the Partnership in excess of distributions			0	0	0	0
Net income attributable to the Partnership			1,200	400	2,400	600
Limited partners' distribution declared on common units
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Partner distributions declared	17,000	16,400	18,200	17,000	36,400	33,400
Net income attributable to the Partnership in excess of distributions			1,500	1,500	3,600	3,600
Net income attributable to the Partnership			$ 19,700	$ 18,500	$ 40,000	$ 37,000
Weighted average units outstanding:
Basic and Diluted (in shares)			52.4	52.4	52.4	52.4
Net income per limited partner unit (in dollars):
Basic and Diluted (in dollars per share)			$ 0.38	$ 0.35	$ 0.77	$ 0.70
Limited partners' distribution declared on subordinated units
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Partner distributions declared	$ 17,000	$ 16,400	$ 18,200	$ 17,000	$ 36,400	$ 33,400
Net income attributable to the Partnership in excess of distributions			1,500	1,400	3,500	3,500
Net income attributable to the Partnership			$ 19,700	$ 18,400	$ 39,900	$ 36,900
Weighted average units outstanding:
Basic and Diluted (in shares)			52.4	52.4	52.4	52.4
Net income per limited partner unit (in dollars):
Basic and Diluted (in dollars per share)			$ 0.38	$ 0.35	$ 0.77	$ 0.70

XML

Commitments and Contingencies - Narrative (Details) - USD ($)	3 Months Ended	6 Months Ended
	Jun. 30, 2020	Jun. 30, 2020	Jun. 30, 2019	Dec. 31, 2019
Site Contingency [Line Items]
Environmental liabilities	$ 3,600,000	$ 3,600,000		$ 3,700,000
Indemnification assets	3,600,000	3,600,000		3,700,000
Impairment charge	0.0		$ 2,300,000
Insurance deductible			1,000,000.0
Griffith Station [Member]
Site Contingency [Line Items]
Accrued insurance recovery			2,100,000	4,300,000
Insurance Settlements Receivable, Noncurrent				700,000
Accrual for Environmental Loss Contingencies, Charges to Expense for New Losses	100,000	200,000	800,000
Insurance Settlements Receivable, Noncurrent				$ 700,000
Accrual for Environmental Loss Contingencies, Charges to Expense for New Losses	$ 100,000	$ 200,000	$ 800,000
Mars
Site Contingency [Line Items]
Equity Method Investment, Ownership Percentage	28.50%	28.50%	28500000.00%
Mardi Gras Transportation System Company LLC
Site Contingency [Line Items]
Equity Method Investment, Ownership Percentage	65.00%	65.00%
Caesar
Site Contingency [Line Items]
Equity Method Investment, Ownership Percentage	56.00%	56.00%	56000000.00%
Cleopatra
Site Contingency [Line Items]
Equity Method Investment, Ownership Percentage	53.00%	53.00%	53000000.00%
Endymion
Site Contingency [Line Items]
Equity Method Investment, Ownership Percentage	65.00%	65.00%	65000000.00%
Proteus
Site Contingency [Line Items]
Equity Method Investment, Ownership Percentage	65.00%	65.00%	65000000.00%
Ursa
Site Contingency [Line Items]
Equity Method Investment, Ownership Percentage	22.70%	22.70%
KM Phoenix
Site Contingency [Line Items]
Equity Method Investment, Ownership Percentage	25.00%	25.00%

XML

Commitments and Contingencies - Summary of Balance Sheet Classification of Environmental Liabilities and Indemnification Assets (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2019
Commitments and Contingencies Disclosure [Abstract]
Current portion of environmental remediation obligations	$ 400	$ 600
Long-term portion of environmental remediation obligations	3,200	3,100
Total	3,600	3,700
Current portion of indemnification assets	400	600
Non-current portion of indemnification assets	3,200	3,100
Total	$ 3,600	$ 3,700

XML

Unit-Based Compensation - Narrative (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted average recognition period			8 months 12 days
Phantom Share Units (PSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total compensation expense	$ 56,000	$ 71,000	$ 119,000	$ 111,000
Unrecognized compensation cost related to phantom unit awards	$ 147,000		$ 147,000
Phantom Share Units (PSUs) | BP Midstream Partners LP 2017 Long Term Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Maximum aggregate number of common units that may be issued (in shares)	5,502,271		5,502,271

XML

Unit-Based Compensation - Phantom Units Activity (Details) - Phantom Share Units (PSUs)	6 Months Ended
	Jun. 30, 2020 $ / shares shares
Number of Units (in units)
Beginning balance outstanding (shares) | shares	15,227
Granted (in shares) | shares	16,038
Vested (in shares) | shares	(15,227)
Ending balance outstanding (shares) | shares	16,038
Weighted Average Grant Date Fair Value per Unit (in dollars)
Beginning balance outstanding (in dollars per share) | $ / shares	$ 16.64
Granted (in dollars per share) | $ / shares	14.03
Vested (in dollars per share) | $ / shares	16.64
Ending balance outstanding (in dollars per share) | $ / shares	$ 14.03

XML

Variable Interest Entity (Details) - USD ($)		3 Months Ended		6 Months Ended
	Oct. 30, 2017	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019	Dec. 31, 2019
Balance Sheet Related Disclosures [Abstract]
Equity method investments		$ 526,500,000	$ 539,900,000	$ 526,500,000	$ 539,900,000	$ 534,400,000
Non-controlling interests		135,300,000		135,300,000		136,900,000
Statement of operations
Income from equity method investments		26,800,000	28,800,000	58,100,000	53,200,000
Less: Net income attributable to non-controlling interests		4,800,000	4,800,000	10,600,000	8,300,000
Net income attributable to the Partnership		$ 40,600,000	37,300,000	82,300,000	74,500,000
Cash flows from operating activities
Distributions of earnings received from equity method investments				60,700,000	55,700,000
Cash flows from financing activities
Distributions to non-controlling interests				$ (12,200,000)	(10,600,000)
Mardi Gras Transportation System Company LLC | Variable Interest Entity, Primary Beneficiary
Variable Interest Entity [Line Items]
Managing member interest (as a percent)	100.00%
Remainder of economic interest held by affiliate (as a percent)	1.00%
Mardi Gras Transportation System Company LLC
Cash flows from financing activities
Equity Method Investment, Ownership Percentage		65.00%		65.00%
Mardi Gras Transportation System Company LLC | Variable Interest Entity, Primary Beneficiary
Variable Interest Entity [Line Items]
Assets of VIE		$ 0		$ 0		0
Balance Sheet Related Disclosures [Abstract]
Equity method investments		386,600,000		386,600,000		391,300,000
Non-controlling interests		135,300,000		135,300,000		$ 136,900,000
Statement of operations
Income from equity method investments		13,700,000	13,900,000	30,300,000	23,800,000
Less: Net income attributable to non-controlling interests		4,800,000	4,800,000	10,600,000	8,300,000
Net income attributable to the Partnership		$ 8,900,000	$ 9,100,000	19,700,000	15,500,000
Cash flows from operating activities
Distributions of earnings received from equity method investments				29,800,000	23,700,000
Cash flows from investing activities
Distribution in excess of earnings from equity method investments				5,200,000	6,600,000
Cash flows from financing activities
Distributions to non-controlling interests				(12,200,000)	(10,600,000)
Net change in cash and cash equivalents				$ 22,800,000	$ 19,700,000

XML

Subsequent Events (Details) - USD ($) $ / shares in Units, $ in Millions	Aug. 13, 2020	Aug. 14, 2019	May 15, 2019
Subsequent Event [Line Items]
Dividends declared per share (in dollars per share)		$ 0.3237	$ 0.3126
Scenario, Forecast
Subsequent Event [Line Items]
Total distribution paid	$ 37.6
Dividends paid to non-affiliated common unitholders	16.6
Net transfers to Parent	21.0
Incentive distribution rights	$ 1.2
Subsequent Event
Subsequent Event [Line Items]
Dividends declared per share (in dollars per share)	$ 0.3475