UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): July 28, 2016
ENBRIDGE ENERGY PARTNERS, L.P.
(Exact Name of Registrant as Specified in Charter)
DELAWARE | 1-10934 | 39-1715850 |
(State or Other Jurisdiction of Incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) |
1100 LOUISIANA, SUITE 3300, HOUSTON, TEXAS 77002
(Address of Principal Executive Offices) (Zip Code)
(713) 821-2000
(Registrant’s telephone number, including area code)
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
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Item 2.02. Results of Operations and Financial Condition.
We issued a press release on July 28, 2016 announcing our financial results for the three and six months ended June 30, 2016, which is attached hereto as Exhibit 99.1. As noted in the press release, a copy of our unaudited condensed consolidated financial statements for the three and six months ended June 30, 2016 is available on our website at www.enbridgepartners.com and is attached hereto as Exhibit 99.2. This information is not deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and is not incorporated by reference into any registration statements filed under the Securities Act of 1933, as amended.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
Reference is made to the “Index of Exhibits” following the signature page, which is hereby incorporated into this Item.
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SIGNATURES
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.
ENBRIDGE ENERGY PARTNERS, L.P. (Registrant) |
|||
By: | Enbridge Energy Management, L.L.C. | ||
as delegate of Enbridge Energy Company, Inc., | |||
Date: July 28, 2016 | By: |
/s/ Noor Kaissi |
|
Noor Kaissi Controller (Duly Authorized Officer) |
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Index of Exhibits
Exhibit |
Description | |
99.1 | Press release of Enbridge Energy Partners, L.P., dated July 28, 2016 reporting financial results for the three and six months ended June 30, 2016 | |
99.2 | Unaudited condensed consolidated financial statements of Enbridge Energy Partners, L.P. for the three and six months ended June 30, 2016 |
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Exhibit 99.1
News Release
Enbridge Energy Partners, L.P. Declares Distribution and Reports Earnings for Second Quarter 2016
HOUSTON — (July 28, 2016) —
Enbridge Energy Partners, L.P. (NYSE:EEP) (“Enbridge Partners” or “the Partnership”) today announced that the board of directors of the delegate of the Partnership’s general partner has declared a quarterly cash distribution of $0.583 per unit, or $2.332 per unit on an annualized basis, on all of the Partnership’s outstanding units for the quarter ended June 30, 2016. The approved distribution remains unchanged from the previous quarter. The distribution is payable on August 12, 2016, to unitholders of record at the close of business on August 5, 2016.
SECOND QUARTER HIGHLIGHTS
· | Reported second quarter net income and cash provided by operating activities of $83.7 million and $280.2 million, respectively. |
· | Reported second quarter adjusted EBITDA and distributable cash flow of $489.3 million and $262.7 million, respectively. |
· | Oil sands production that was curtailed for northeastern Alberta wildfires has substantially come back on line with the Partnership’s Lakehead system utilization returning to anticipated levels. |
· | Completed the final phase of the Eastern Access Program by placing the Line 6B expansion into service. |
“Our second quarter financial results are tracking well with our expectations and reflect the reliability of our low-risk business model,” said Mark Maki, president for the Partnership. “Extreme wildfires impacted the producing regions of northern Alberta in May and June, and we are proud of how our team responded to ensure the safety of our people and the integrity of our liquids pipeline systems. We worked diligently with our customers to bring affected volumes back online as quickly and safely as possible. Demand for our liquids pipeline systems remains strong, and we expect Lakehead system deliveries during the third quarter to return to levels anticipated at the outset of the year.”
As previously disclosed earlier this month, the Partnership and certain other subsidiaries of Enbridge Inc. agreed to a consent decree with the U.S. Department of Justice and the U.S. Environmental Protection Agency on civil penalties and other actions relating to the 2010 incidents on our Line 6B pipeline in Marshall, Mich., and Line 6A pipeline in Romeoville, Ill.
“From the beginning, we took responsibility for the Line 6B release, and we have fulfilled our commitments to the people of Michigan to conduct a thorough clean up and restoration effort and to cover all costs,” Maki said. “We are a company that is focused first and foremost on the safety and operational reliability of our pipeline systems.”
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During the second quarter, the Partnership completed the final phase of the Eastern Access Expansion, adding an incremental 70,000 barrels per day (bpd) of capacity to the Lakehead system between Griffith, Ind., and Stockbridge, Mich.
“The Partnership continues to successfully execute its organic growth program, bringing needed additional capacity and connectivity to our liquids pipeline systems. Expansions to our system further enhance our unmatched market access, which is critical to our customers. Increasing our customers’ access to premium markets gives us confidence in the continued high system utilization of our liquids pipelines business,” Maki continued. “Additionally, we are progressing on our strategic evaluation of the Partnership’s investments in the natural gas business through Midcoast Operating, L.P. and Midcoast Energy Partners, L.P. (MEP), and we expect to complete the evaluation by the end of this year.”
The Partnership’s key financial results for the three and six months ended June 30, 2016, compared to the same period in 2015, were as follows:
Three months ended June 30, | Six months ended June 30, | |||||||||||||||
(unaudited; dollars in millions, except per unit amounts) | 2016 | 2015 | 2016 | 2015 | ||||||||||||
Net income (loss)(1) | $ | 83.7 | $ | (97.1 | ) | $ | 163.7 | $ | 43.0 | |||||||
Net income (loss) per unit | 0.08 | (0.44 | ) | 0.15 | (0.18 | ) | ||||||||||
Adjusted EBITDA(2) | 489.3 | 422.4 | 955.5 | 854.6 | ||||||||||||
Adjusted net income(1) | 135.6 | 120.5 | 249.4 | 263.3 | ||||||||||||
Adjusted net income per unit | 0.22 | 0.18 | 0.39 | 0.46 |
(1) | Net income and adjusted net income attributable to general and limited partner ownership interests in Enbridge Partners. |
(2) | Includes non-controlling interest. |
Adjusted net income and adjusted EBITDA for the three and six months ended June 30, 2016, as reported above, eliminates the effect of: (a) non-cash, mark-to-market net gains and losses; (b) Line 2 hydrotest expenses, net of recoveries; (c) non-cash asset impairment; and other adjustments. Refer to the Non-GAAP Reconciliations section below for additional details.
Net income of $83.7 million for the second quarter of 2016 was $180.8 million higher than the same period from the prior year, primarily due to a goodwill impairment charge in the Natural Gas segment in the second quarter of 2015. No similar charge was recorded in the current quarter. Adjusted net income of $135.6 million for the second quarter of 2016 was $15.1 million higher than the same period from the prior year primarily due to additional assets placed into service related to the Partnership’s Mainline Expansion project.
During the second quarter, the Partnership attributed approximately $22.5 million of earnings to its outstanding Series 1 Preferred units. This amount is deducted from net income to arrive at the amount of net income attributable to the general and limited partners. Preferred distributions are accrued at an annual rate of 7.5 percent.
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COMPARATIVE EARNINGS STATEMENT
Three months ended June 30, | Six months ended June 30, | |||||||||||||||
(unaudited; dollars in millions except per unit amounts) | 2016 | 2015 | 2016 | 2015 | ||||||||||||
Operating revenue | $ | 1,048.9 | $ | 1,313.1 | $ | 2,110.5 | $ | 2,741.7 | ||||||||
Operating expenses: | ||||||||||||||||
Commodity cost | 359.1 | 670.6 | 707.1 | 1,449.7 | ||||||||||||
Environmental costs, net of recoveries | 0.1 | (0.8 | ) | 17.0 | - | |||||||||||
Operating and administrative | 212.8 | 207.2 | 427.4 | 424.3 | ||||||||||||
Power | 59.7 | 57.2 | 132.5 | 120.8 | ||||||||||||
Depreciation and amortization | 144.9 | 129.5 | 285.8 | 257.9 | ||||||||||||
Goodwill impairment | - | 246.7 | - | 246.7 | ||||||||||||
Asset impairment | 10.6 | 12.3 | 11.0 | 12.3 | ||||||||||||
Operating income (loss) | 261.7 | (9.6 | ) | 529.7 | 230.0 | |||||||||||
Interest expense, net | (101.5 | ) | (78.0 | ) | (214.4 | ) | (126.3 | ) | ||||||||
Allowance for equity used during construction | 13.3 | 17.3 | 25.6 | 40.3 | ||||||||||||
Other income | 6.7 | 6.0 | 14.2 | 11.9 | ||||||||||||
Income (loss) before income tax expense | 180.2 | (64.3 | ) | 355.1 | 155.9 | |||||||||||
Income tax benefit (expense) | (2.5 | ) | 3.8 | (5.0 | ) | 1.4 | ||||||||||
Net income (loss) | 177.7 | (60.5 | ) | 350.1 | 157.3 | |||||||||||
Less: Net income attributable to: | ||||||||||||||||
Noncontrolling interest | 70.3 | 10.0 | 139.1 | 61.3 | ||||||||||||
Series 1 preferred unit distributions | 22.5 | 22.5 | 45.0 | 45.0 | ||||||||||||
Accretion of discount on Series 1 preferred units | 1.2 | 4.1 | 2.3 | 8.0 | ||||||||||||
Net income (loss) attributable to general and limited partner ownership interests in Enbridge Energy Partners, L.P. | $ | 83.7 | $ | (97.1 | ) | $ | 163.7 | $ | 43.0 | |||||||
Less: Allocations to general partner | 56.0 | 52.3 | 111.9 | 106.5 | ||||||||||||
Net income (loss) allocable to common units and i-units | $ | 27.7 | $ | (149.4 | ) | $ | 51.8 | $ | (63.5 | ) | ||||||
Weighted average common units and i-units (basic and diluted) | 347.1 | 339.9 | 345.9 | 336.3 | ||||||||||||
Net income (loss) per common unit and i-unit (basic and diluted) | $ | 0.08 | $ | (0.44 | ) | $ | 0.15 | $ | (0.18 | ) |
COMPARISON OF QUARTERLY RESULTS
Following are explanations for significant changes in the Partnership’s financial results, comparing the three and six months ended June 30, 2016 with the same period of 2015. The comparison refers to operating income and adjusted operating income. Adjusted operating income excludes the effect of certain non-cash and other items that we believe are not indicative of our core operating results (see Non-GAAP Reconciliations section below).
Three months ended | Six months ended | |||||||||||||||
Operating Income (loss) | June 30, | June 30, | ||||||||||||||
(unaudited; dollars in millions) | 2016 | 2015 | 2016 | 2015 | ||||||||||||
Liquids | $ | 324.5 | $ | 271.6 | $ | 625.9 | $ | 541.8 | ||||||||
Natural Gas | (60.1 | ) | (277.6 | ) | (90.0 | ) | (304.2 | ) | ||||||||
Corporate | (2.7 | ) | (3.6 | ) | (6.2 | ) | (7.6 | ) | ||||||||
Operating income (loss) | $ | 261.7 | $ | (9.6 | ) | $ | 529.7 | $ | 230.0 |
Three months ended | Six months ended | |||||||||||||||
Adjusted Operating Income | June 30, | June 30, | ||||||||||||||
(unaudited; dollars in millions) | 2016 | 2015 | 2016 | 2015 | ||||||||||||
Liquids | $ | 330.8 | $ | 270.6 | $ | 641.3 | $ | 543.0 | ||||||||
Natural Gas | (3.7 | ) | 2.7 | (5.3 | ) | 9.8 | ||||||||||
Corporate | (2.7 | ) | (3.6 | ) | (6.2 | ) | (7.6 | ) | ||||||||
Adjusted operating income | $ | 324.4 | $ | 269.7 | $ | 629.8 | $ | 545.2 |
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Liquids – Second quarter operating income for the Liquids segment increased $52.9 million to $324.5 million over the comparable period in 2015. Second quarter adjusted operating income for the Liquids segment increased $60.2 million to $330.8 million over the comparable period in 2015. Revenues from our liquids pipeline systems increased due to higher transportation rates attributable to new assets placed into service related to our Mainline Expansion project. While Lakehead system deliveries were impacted by the extreme wildfires from northeast Alberta during the second quarter of 2016, revenues increased over the comparable period in 2015 due to higher system deliveries attributable to enhanced downstream market access by the Enbridge system. Higher segment revenues were partially offset by increased operating and depreciation expense over the same period from prior year due to new assets placed into service.
Three months ended | Six months ended | |||||||||||||||
Liquids Systems Volumes | June 30, | June 30, | ||||||||||||||
(thousand barrels per day) | 2016 | 2015 | 2016 | 2015 | ||||||||||||
Lakehead | 2,440 | 2,208 | 2,588 | 2,269 | ||||||||||||
Mid-Continent | 216 | 221 | 192 | 210 | ||||||||||||
North Dakota | 381 | 365 | 392 | 353 | ||||||||||||
Total | 3,037 | 2,794 | 3,172 | 2,832 |
Natural Gas – Second quarter operating loss for the Natural Gas segment decreased $217.5 million to ($60.1) million over the comparable period in 2015. The decrease in operating loss was primarily attributable to a goodwill impairment charge that was recorded during the three months ended June 30, 2015. No similar charge was recorded in the current quarter. Second quarter adjusted operating income (loss) for the Natural Gas segment decreased $6.4 million to ($3.7) million over the comparable period in 2015. The decrease in adjusted operating income was predominantly attributable to lower natural gas and NGL system production volumes, in addition to lower commodity prices, net of hedges. Lower system volumes were primarily attributable to the continued low commodity price environment for hydrocarbons, which has resulted in reductions in drilling activity from producers in the areas we operate. The decrease in segment operating income was partially offset by reductions in operating and administrative expenses from enacted cost reduction measures.
Three months ended | Six months ended | |||||||||||||||
Natural Gas Throughput | June 30, | June 30, | ||||||||||||||
(MMBtu per day) | 2016 | 2015 | 2016 | 2015 | ||||||||||||
East Texas | 931,000 | 968,000 | 939,000 | 988,000 | ||||||||||||
Anadarko | 637,000 | 794,000 | 645,000 | 811,000 | ||||||||||||
North Texas | 203,000 | 274,000 | 210,000 | 281,000 | ||||||||||||
Total | 1,771,000 | 2,036,000 | 1,794,000 | 2,080,000 |
Three months ended | Six months ended | |||||||||||||||
NGL Production | June 30, | June 30, | ||||||||||||||
(Barrels per day) | 2016 | 2015 | 2016 | 2015 | ||||||||||||
Total System Production | 71,747 | 81,056 | 72,666 | 81,051 |
MANAGEMENT REVIEW OF QUARTERLY RESULTS
Enbridge Partners will host a conference call at 4:30 p.m. Eastern Time on Thursday, July 28, 2016 to review its second quarter 2016 financial results. The call will be webcast live over the internet and may be accessed on Enbridge Partners’ website under “Events and Presentations” or directly at http://edge.media-server.com/m/p/xf2xzdd6.
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Presentation slides and condensed financial statements will also be available on the Partnership’s website at the link below.
http://www.enbridgepartners.com under “Events and Presentations”
Replay Information
A webcast replay will be available at the link above approximately two hours after the conclusion of the event. A transcript will be posted to the website within approximately 24 hours.
NON-GAAP RECONCILIATIONS
Adjusted net income for the Partnership and adjusted operating income for the principal business segments are provided to illustrate trends in income excluding non-cash unrealized derivative fair value losses and gains and other items that we believe are not indicative of our core operating results and business outlook. The derivative non-cash losses and gains result from marking to market certain financial derivatives used by the Partnership for hedging purposes that do not qualify for hedge accounting treatment in accordance with the authoritative accounting guidance as prescribed under generally accepted accounting principles in the United States. Non-GAAP measures no longer include make-up rights and option premium amortization adjustments. These changes will be made on a prospective basis and are not material for historical periods presented.
Adjusted Net Income | Three months ended June 30, | Six months ended June 30, | ||||||||||||||
(unaudited; dollars in millions except per unit amounts) | 2016 | 2015 | 2016 | 2015 | ||||||||||||
Net income (loss) attributable to general and limited partner ownership interests in Enbridge Energy Partners, L.P. | $ | 83.7 | $ | (97.1 | ) | $ | 163.7 | $ | 43.0 | |||||||
Noncash derivative fair value losses (gains) | ||||||||||||||||
-Liquids | 5.1 | 8.3 | 6.8 | 12.2 | ||||||||||||
-Natural Gas | 34.8 | 18.7 | 55.5 | 45.4 | ||||||||||||
-Corporate | 1.5 | (3.8 | ) | 3.4 | (32.4 | ) | ||||||||||
Accretion of discount on Series 1 preferred units | 1.2 | 4.1 | 2.3 | 8.0 | ||||||||||||
Make-up rights adjustment | - | (3.2 | ) | 1.0 | (5.8 | ) | ||||||||||
Line 2 hydrotest expenses, net of recoveries | 0.2 | (6.1 | ) | (8.3 | ) | (5.7 | ) | |||||||||
Line 6A and 6B incident expenses, net of recoveries | 1.0 | - | 16.0 | - | ||||||||||||
Option premium amortization | - | (2.6 | ) | 0.9 | (3.6 | ) | ||||||||||
Goodwill impairment | - | 192.8 | - | 192.8 | ||||||||||||
Asset impairment | 8.1 | 9.4 | 8.1 | 9.4 | ||||||||||||
Adjusted net income | 135.6 | 120.5 | 249.4 | 263.3 | ||||||||||||
Less: Allocations to general partner | 57.0 | 56.7 | 113.6 | 110.9 | ||||||||||||
Adjusted net income allocable to common units and i-units | $ | 78.6 | $ | 63.8 | $ | 135.8 | $ | 152.4 | ||||||||
Weighted average common units and i-units outstanding (millions) | 347.1 | 339.9 | 345.9 | 336.3 | ||||||||||||
Adjusted net income per common unit and i-unit (dollars) | $ | 0.22 | $ | 0.18 | $ | 0.39 | $ | 0.46 |
Three months ended | Six months ended | |||||||||||||||
Liquids | June 30, | June 30, | ||||||||||||||
(unaudited; dollars in millions) | 2016 | 2015 | 2016 | 2015 | ||||||||||||
Operating income | $ | 324.5 | $ | 271.6 | $ | 625.9 | $ | 541.8 | ||||||||
Noncash derivative fair value losses | 5.1 | 8.3 | 6.8 | 12.2 | ||||||||||||
Make-up rights adjustment | - | (3.2 | ) | 0.9 | (5.3 | ) | ||||||||||
Line 2 hydrotest expenses, net of recoveries | 0.2 | (6.1 | ) | (8.3 | ) | (5.7 | ) | |||||||||
Line 6A and 6B incident expenses, net of recoveries | 1.0 | - | 16.0 | - | ||||||||||||
Adjusted operating income | $ | 330.8 | $ | 270.6 | $ | 641.3 | $ | 543.0 |
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Three months ended | Six months ended | |||||||||||||||
Natural Gas | June 30, | June 30, | ||||||||||||||
(unaudited; dollars in millions) | 2016 | 2015 | 2016 | 2015 | ||||||||||||
Operating loss | $ | (60.1 | ) | $ | (277.6 | ) | $ | (90.0 | ) | $ | (304.2 | ) | ||||
Noncash derivative fair value losses | 45.8 | 24.6 | 72.9 | 59.7 | ||||||||||||
Option premium amortization | - | (3.3 | ) | 1.2 | (4.7 | ) | ||||||||||
Goodwill impairment | - | 246.7 | - | 246.7 | ||||||||||||
Asset impairment | 10.6 | 12.3 | 10.6 | 12.3 | ||||||||||||
Adjusted operating income (loss) | $ | (3.7 | ) | $ | 2.7 | $ | (5.3 | ) | $ | 9.8 |
ADJUSTED EBITDA AND DISTRIBUTABLE CASH FLOW
Adjusted EBITDA (adjusted earnings before interest, taxes, depreciation and amortization) is used as a supplemental financial measurement to manage the performance of the entity. Distributable cash flow is used as a supplemental financial measurement to assess liquidity and the ability to generate cash sufficient to pay interest costs and make cash distributions to unitholders. The following reconciliations of net income (loss) to adjusted EBITDA and net cash provided by operating activities to distributable cash flow are provided because adjusted EBITDA and distributable cash flow are not financial measures recognized under generally accepted accounting principles.
Three months ended | Six months ended | |||||||||||||||
Adjusted EBITDA | June 30, | June 30, | ||||||||||||||
(unaudited; dollars in millions) | 2016 | 2015 | 2016 | 2015 | ||||||||||||
Net income (loss) attributable to general and limited partner ownership interests in Enbridge Energy Partners, L.P. | $ | 83.7 | $ | (97.1 | ) | $ | 163.7 | $ | 43.0 | |||||||
Depreciation and amortization | 144.9 | 129.5 | 285.8 | 257.9 | ||||||||||||
Interest expense, net | 101.5 | 78.0 | 214.4 | 126.3 | ||||||||||||
Income tax expense (benefit) | 2.5 | (3.8 | ) | 5.0 | (1.4 | ) | ||||||||||
Net income attributable to noncontrolling interest | 70.3 | 10.0 | 139.1 | 61.3 | ||||||||||||
Series 1 preferred unit distributions | 22.5 | 22.5 | 45.0 | 45.0 | ||||||||||||
Noncash derivative fair value losses | 50.9 | 32.9 | 79.7 | 71.9 | ||||||||||||
Accretion of discount on Series 1 preferred units | 1.2 | 4.1 | 2.3 | 8.0 | ||||||||||||
Make-up rights adjustment | - | (3.3 | ) | 1.0 | (6.0 | ) | ||||||||||
Line 2 hydrotest expense, net of recoveries | 0.2 | (6.1 | ) | (8.3 | ) | (5.7 | ) | |||||||||
Line 6A and 6B incident expenses, net of recoveries | 1.0 | - | 16.0 | - | ||||||||||||
Option premium amortization | - | (3.3 | ) | 1.2 | (4.7 | ) | ||||||||||
Goodwill impairment | - | 246.7 | - | 246.7 | ||||||||||||
Asset impairment | 10.6 | 12.3 | 10.6 | 12.3 | ||||||||||||
Adjusted EBITDA | $ | 489.3 | $ | 422.4 | $ | 955.5 | $ | 854.6 |
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Three months ended | Six months ended | |||||||||||||||
Distributable Cash Flow | June 30, | June 30, | ||||||||||||||
(unaudited; dollars in millions) | 2016 | 2015 | 2016 | 2015 | ||||||||||||
Net cash provided by operating activities | $ | 280.2 | $ | 266.4 | $ | 546.5 | $ | 646.9 | ||||||||
Changes in operating assets and liabilities, net of cash acquired | 104.9 | 71.1 | 194.0 | 28.5 | ||||||||||||
Allowance for equity used during construction | 13.3 | 17.3 | 25.6 | 40.3 | ||||||||||||
Option premium amortization | - | (3.3 | ) | 1.2 | (4.7 | ) | ||||||||||
Line 2 hydrotest expense, net of recoveries | 0.2 | (6.1 | ) | (8.3 | ) | (5.7 | ) | |||||||||
Distributions in excess of equity earnings | 1.2 | 1.9 | 2.7 | 3.4 | ||||||||||||
Maintenance capital expenditures | (11.6 | ) | (17.7 | ) | (19.7 | ) | (33.8 | ) | ||||||||
Non-controlling interests | (118.5 | ) | (97.0 | ) | (226.3 | ) | (181.6 | ) | ||||||||
Distribution support agreement(1) | (1.0 | ) | - | (1.4 | ) | - | ||||||||||
Other | (6.0 | ) | (1.0 | ) | (7.1 | ) | (8.0 | ) | ||||||||
Distributable cash flow | $ | 262.7 | $ | 231.6 | $ | 507.2 | $ | 485.3 |
(1) | Distribution agreement in place with MEP to support 1.0x coverage of the then declared distribution with a term through 2017, and no requirement for MEP to reimburse EEP for adjusted distributions. |
About Enbridge Energy Partners, L.P.
Enbridge Energy Partners, L.P. owns and operates a diversified portfolio of crude oil and, through its interests in Midcoast Energy Partners, L.P. (“Midcoast Partners”) (NYSE: MEP), natural gas transportation systems in the United States. Its principal crude oil system is the largest pipeline transporter of growing oil production from western Canada and the North Dakota Bakken formation. The system’s deliveries to refining centers and connected carriers in the United States account for approximately 23 percent of total U.S. oil imports. Midcoast Partners’ natural gas gathering, treating, processing and transmission assets, which are principally located onshore in the active U.S. Mid-Continent and Gulf Coast areas, deliver approximately 2.0 billion cubic feet of natural gas daily.
About Enbridge Energy Management, L.L.C.
Enbridge Management manages the business and affairs of Enbridge Partners, and its sole asset is an approximate 16 percent limited partner interest in Enbridge Partners. Enbridge Energy Company, Inc., an indirect wholly owned subsidiary of Enbridge Inc. of Calgary, Alberta, Canada (NYSE: ENB) (TSX: ENB) is the general partner of Enbridge Partners and holds an approximate 42 percent interest in Enbridge Partners together with all of the outstanding preferred units and Class B, D and E units in Enbridge Partners. Enbridge Management is the delegate of the general partner of Enbridge Partners.
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Forward-Looking Statements
This news release includes forward-looking statements and projections, which are statements that do not relate strictly to historical or current facts. These statements frequently use the following words, variations thereon or comparable terminology: “anticipate,” “believe,” “consider,” “continue,” “could,” “estimate,” “expect,” “explore,” “evaluate,” “forecast,” “intend,” “may,” “opportunity,” “plan,” “position,” “projection,” “should,” “strategy,” “target,” “will” and similar words. Although the Partnership believes that such forward-looking statements are reasonable based on currently available information, such statements involve risks, uncertainties and assumptions and are not guarantees of performance. Future actions, conditions or events and future results of operations may differ materially from those expressed in these forward-looking statements. Many of the factors that will determine these results are beyond the Partnership’s ability to control or predict. Specific factors that could cause actual results to differ from those in the forward-looking statements include: (1) changes in the demand for or the supply of, forecast data for, and price trends related to crude oil, liquid petroleum, natural gas and NGLs, including the rate of development of the Alberta Oil Sands; (2) the Partnership’s ability to successfully complete and finance expansion projects or drop-down opportunities; (3) the effects of competition, in particular, by other pipeline systems; (4) shut-downs or cutbacks at the Partnership’s facilities or refineries, petrochemical plants, utilities or other businesses for which the Partnership transports products or to whom the Partnership sells products; (5) hazards and operating risks that may not be covered fully by insurance, including those related to Line 6B and any additional fines and penalties assessed in connection with the crude oil release on that line; (6) costs in connection with complying with the settlement consent decree related to Line 6B and Line 6A, which is still subject to court approval, and/or the failure to receive court approval of, or material modifications to, such decree; (7) changes in or challenges to the Partnership’s tariff rates; (8) changes in laws or regulations to which the Partnership is subject, including compliance with environmental and operational safety regulations that may increase costs of system integrity testing and maintenance; and (9) permitting at federal, state and local levels in regards to the construction of new assets.
“Enbridge” refers collectively to Enbridge Inc. and its subsidiaries other than the Partnership and our subsidiaries.
Forward-looking statements regarding “drop-down” growth opportunities from Enbridge are further qualified by the fact that Enbridge is under no obligation to offer to sell us interests in its U.S. projects, and we are under no obligation to buy any such interests. Similarly, any forward-looking statements regarding potential “drop-down” transactions of interests in Midcoast Operating to Midcoast Energy Partners, L.P. are further qualified by the fact that we are under no obligation to sell to Midcoast Energy Partners, L.P. any such interests, and Midcoast Energy Partners, L.P. is under no obligation to buy any such interests. As a result, we do not know when or if any such transactions will occur.
Except to the extent required by law, we assume no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Reference should also be made to the Partnership’s filings with the U.S. Securities and Exchange Commission (the “SEC”), including its Annual Report on Form 10-K for the year ended December 31, 2015 and any subsequently filed Quarterly Report on Form 10-Q for additional factors that may affect results. These filings are available to the public over the Internet at the SEC’s web site (www.sec.gov) and at the Partnership’s web site.
Tax Notification
This release serves as qualified notice to nominees as provided for under Treasury Regulation Section 1.1446-4(b)(4) and (d). Please note that 100 percent of Enbridge Energy Partners, L.P.’s distributions to foreign investors are attributable to income that is effectively connected with a United States trade or business. Accordingly, all of Enbridge Energy Partners, L.P.’s distributions to foreign investors are subject to federal income tax withholding at the highest effective tax rate for individuals or corporations, as applicable. Nominees, and not Enbridge Energy Partners, L.P., are treated as withholding agents responsible for withholding distributions received by them on behalf of foreign investors.
FOR FURTHER INFORMATION PLEASE CONTACT
Investor Relations Contact: | Media Contact: |
Sanjay Lad, CFA | Terri Larson, APR |
Toll-free: (866) EEP INFO or (866) 337-4636 | Toll-free: (877) 496-8142 |
E-mail: eep@enbridge.com | E-mail: usmedia@enbridge.com |
Website: www.enbridgepartners.com |
8
Exhibit 99.2
ENBRIDGE ENERGY PARTNERS, L.P.
CONSOLIDATED STATEMENTS OF INCOME
For the three months | For the six months | |||||||||||||||
ended June 30, | ended June 30, | |||||||||||||||
2016 | 2015 | 2016 | 2015 | |||||||||||||
(unaudited; in millions, except per unit amounts) | ||||||||||||||||
Operating revenues: | ||||||||||||||||
Commodity sales | $ | 379.4 | $ | 702.7 | $ | 757.2 | $ | 1,503.6 | ||||||||
Commodity sales - affiliate | 1.4 | 28.4 | 6.6 | 50.2 | ||||||||||||
Transportation and other services | 638.2 | 548.5 | 1,294.2 | 1,123.2 | ||||||||||||
Transportation and other services - affiliate | 29.9 | 33.5 | 52.5 | 64.7 | ||||||||||||
1,048.9 | 1,313.1 | 2,110.5 | 2,741.7 | |||||||||||||
Operating expenses: | ||||||||||||||||
Commodity costs | 350.5 | 647.5 | 685.9 | 1,408.7 | ||||||||||||
Commodity costs - affiliate | 8.6 | 23.1 | 21.2 | 41.0 | ||||||||||||
Environmental costs, net of recoveries | 0.1 | (0.8 | ) | 17.0 | - | |||||||||||
Operating and administrative | 102.7 | 91.5 | 198.8 | 189.7 | ||||||||||||
Operating and administrative - affiliate | 110.1 | 115.7 | 228.6 | 234.6 | ||||||||||||
Power | 59.7 | 57.2 | 132.5 | 120.8 | ||||||||||||
Depreciation and amortization | 144.9 | 129.5 | 285.8 | 257.9 | ||||||||||||
Goodwill impairment | - | 246.7 | - | 246.7 | ||||||||||||
Asset impairment | 10.6 | 12.3 | 11.0 | 12.3 | ||||||||||||
787.2 | 1,322.7 | 1,580.8 | 2,511.7 | |||||||||||||
Operating income (loss) | 261.7 | (9.6 | ) | 529.7 | 230.0 | |||||||||||
Interest expense, net | (101.5 | ) | (78.0 | ) | (214.4 | ) | (126.3 | ) | ||||||||
Allowance for equity used during construction | 13.3 | 17.3 | 25.6 | 40.3 | ||||||||||||
Other income | 6.7 | 6.0 | 14.2 | 11.9 | ||||||||||||
Income (loss) before income tax (expense) benefit | 180.2 | (64.3 | ) | 355.1 | 155.9 | |||||||||||
Income tax (expense) benefit | (2.5 | ) | 3.8 | (5.0 | ) | 1.4 | ||||||||||
Net income (loss) | 177.7 | (60.5 | ) | 350.1 | 157.3 | |||||||||||
Less: Net income attributable to: | ||||||||||||||||
Noncontrolling interest | 70.3 | 10.0 | 139.1 | 61.3 | ||||||||||||
Series 1 preferred unit distributions | 22.5 | 22.5 | 45.0 | 45.0 | ||||||||||||
Accretion of discount on Series 1 preferred units | 1.2 | 4.1 | 2.3 | 8.0 | ||||||||||||
Net income (loss) attributable to general and limited partner ownership interests in Enbridge Energy Partners, L.P. | $ | 83.7 | $ | (97.1 | ) | $ | 163.7 | $ | 43.0 | |||||||
Net income (loss) allocable to common units and i-units | $ | 27.7 | $ | (149.4 | ) | $ | 51.8 | $ | (63.5 | ) | ||||||
Net income (loss) per common unit and i-unit (basic and diluted) | $ | 0.08 | $ | (0.44 | ) | $ | 0.15 | $ | (0.18 | ) | ||||||
Weighted average common units and i-units outstanding (basic and diluted) | 347.1 | 339.9 | 345.9 | 336.3 |
1
ENBRIDGE ENERGY PARTNERS, L.P.
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the six months ended June 30, | ||||||||
2016 | 2015 | |||||||
(unaudited; in millions) | ||||||||
Cash provided by operating activities: | ||||||||
Net income | $ | 350.1 | $ | 157.3 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
Depreciation and amortization | 285.8 | 257.9 | ||||||
Derivative fair value net losses | 83.1 | 39.5 | ||||||
Inventory market price adjustments | - | 5.3 | ||||||
Goodwill impairment | - | 246.7 | ||||||
Environmental costs, net of recoveries | 15.7 | (1.0 | ) | |||||
Distributions from investments in joint ventures | 13.7 | 11.6 | ||||||
Equity earnings from investments in joint ventures | (13.7 | ) | (11.6 | ) | ||||
Allowance for equity used during construction | (25.6 | ) | (40.3 | ) | ||||
Amortization of debt issuance and hedging costs | 20.8 | 6.1 | ||||||
Asset impairment | 11.0 | 12.3 | ||||||
Other | 0.2 | (4.0 | ) | |||||
Changes in operating assets and liabilities, net of acquisitions: | ||||||||
Receivables, trade and other | 19.6 | 45.7 | ||||||
Due from General Partner and affiliates | (47.1 | ) | (62.7 | ) | ||||
Accrued receivables | 24.7 | 158.9 | ||||||
Inventory | (14.4 | ) | (1.3 | ) | ||||
Current and long-term other assets | (22.6 | ) | (33.0 | ) | ||||
Due to General Partner and affiliates | (27.5 | ) | 66.9 | |||||
Accounts payable and other | (93.6 | ) | (56.6 | ) | ||||
Environmental liabilities | (10.0 | ) | (21.6 | ) | ||||
Accrued purchases | (7.7 | ) | (114.8 | ) | ||||
Interest payable | (1.3 | ) | 1.2 | |||||
Property and other taxes payable | (14.7 | ) | (15.6 | ) | ||||
Net cash provided by operating activities | 546.5 | 646.9 | ||||||
Cash used in investing activities: | ||||||||
Additions to property, plant and equipment | (678.1 | ) | (994.9 | ) | ||||
Asset acquisitions | - | (85.0 | ) | |||||
Changes in restricted cash | 11.9 | 78.6 | ||||||
Investments in joint ventures | - | (2.5 | ) | |||||
Distributions from investments in joint ventures in excess of cumulative earnings | 7.3 | 6.7 | ||||||
Other | (1.2 | ) | 0.8 | |||||
Net cash used in investing activities | (660.1 | ) | (996.3 | ) | ||||
Cash provided by financing activities: | ||||||||
Net proceeds from unit issuances | - | 294.8 | ||||||
Distributions to partners | (432.0 | ) | (403.8 | ) | ||||
Repayments to General Partner | - | (306.0 | ) | |||||
Net borrowings (repayments) under credit facilities | 615.0 | (300.0 | ) | |||||
Net commercial paper borrowings (repayments) | (131.8 | ) | 644.9 | |||||
Contributions from noncontrolling interest | 63.4 | 502.6 | ||||||
Distributions to noncontrolling interest | (15.2 | ) | (171.2 | ) | ||||
Other | (0.8 | ) | - | |||||
Net cash provided by financing activities | 98.6 | 261.3 | ||||||
Net decrease in cash and cash equivalents | (15.0 | ) | (88.1 | ) | ||||
Cash and cash equivalents at beginning of year | 148.1 | 197.9 | ||||||
Cash and cash equivalents at end of period | $ | 133.1 | $ | 109.8 |
2
ENBRIDGE ENERGY PARTNERS, L.P.
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
June 30, | December 31, | |||||||
2016 | 2015 | |||||||
(unaudited; in millions) | ||||||||
ASSETS | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 133.1 | $ | 148.1 | ||||
Restricted cash | 22.7 | 37.6 | ||||||
Receivables, trade and other, net of allowance for doubtful accounts of $2.6 million | ||||||||
and $2.5 million at June 30, 2016 and December 31, 2015, respectively | 5.7 | 25.2 | ||||||
Due from General Partner and affiliates | 106.5 | 59.4 | ||||||
Accrued receivables | 53.2 | 77.9 | ||||||
Inventory | 49.5 | 35.1 | ||||||
Other current assets | 146.1 | 173.0 | ||||||
516.8 | 556.3 | |||||||
Property, plant and equipment, net | 17,643.0 | 17,412.4 | ||||||
Intangible assets, net | 268.2 | 280.0 | ||||||
Other assets, net | 485.5 | 525.6 | ||||||
$ | 18,913.5 | $ | 18,774.3 | |||||
LIABILITIES AND PARTNERS’ CAPITAL | ||||||||
Current liabilities: | ||||||||
Due to General Partner and affiliates | $ | 163.4 | $ | 190.9 | ||||
Accounts payable and other | 431.8 | 654.9 | ||||||
Environmental liabilities | 110.3 | 95.8 | ||||||
Accrued purchases | 138.4 | 146.1 | ||||||
Interest payable | 97.6 | 98.9 | ||||||
Property and other taxes payable | 89.0 | 103.7 | ||||||
Current maturities of long-term debt | 299.9 | 300.0 | ||||||
1,330.4 | 1,590.3 | |||||||
Long-term debt | 8,213.9 | 7,728.4 | ||||||
Due to General Partner and affiliates | 283.2 | 238.3 | ||||||
Other long-term liabilities | 371.9 | 305.2 | ||||||
10,199.4 | 9,862.2 | |||||||
Commitments and contingencies | ||||||||
Partners’ capital: | ||||||||
Series 1 preferred units (48,000,000 authorized and issued at June 30, 2016 and | ||||||||
December 31, 2015) | 1,189.1 | 1,186.8 | ||||||
Class D units (66,100,000 authorized and issued at June 30, 2016 and | ||||||||
December 31, 2015) | 2,517.6 | 2,517.6 | ||||||
Class E units (18,114,975 authorized and issued at June 30, 2016 and | ||||||||
December 31, 2015) | 778.2 | 778.2 | ||||||
Class A common units (262,208,428 authorized and issued at June 30, 2016 | ||||||||
and December 31, 2015) | - | - | ||||||
Class B common units (7,825,500 authorized and issued at June 30, 2016 | ||||||||
and December 31, 2015) | - | - | ||||||
i-units (78,004,678 and 73,285,739 authorized and issued at June 30, 2016 and | ||||||||
December 31, 2015, respectively) | - | 212.6 | ||||||
Incentive distribution units (1,000 authorized and issued at June 30, 2016 and | ||||||||
December 31, 2015) | 495.1 | 495.0 | ||||||
General Partner | 91.6 | 147.4 | ||||||
Accumulated other comprehensive loss | (489.3 | ) | (370.0 | ) | ||||
Total Enbridge Energy Partners, L.P. partners’ capital | 4,582.3 | 4,967.6 | ||||||
Noncontrolling interest | 4,131.8 | 3,944.5 | ||||||
Total partners’ capital | 8,714.1 | 8,912.1 | ||||||
$ | 18,913.5 | $ | 18,774.3 |
3
NET INCOME PER LIMITED PARTNER UNIT
We allocate our net income among our Series 1 Preferred Units, or Preferred Units, our General Partner interest and our limited partner units using the two-class method in accordance with applicable authoritative accounting guidance. Under the two-class method, we allocate our net income attributable to our General Partner and our limited partners according to the distribution formula for available cash as set forth in our partnership agreement. We allocate our net income to our limited partners owning Class D units and Class E units equal to the distributions that they receive. We also allocate any earnings in excess of distributions to our General Partner and limited partners owning Class A and Class B common units and i-units utilizing the distribution formula for available cash specified in our partnership agreement. We allocate any distributions in excess of earnings for the period to our General Partner and limited partners owning Class A and B common units and i-units based on their sharing of losses of 2% and 98%, respectively, as set forth in our partnership agreement. We calculate distributions to the General Partner and limited partners based upon the distribution rates and percentages set forth in the following table:
4
Distribution Targets | Portion of Quarterly Distribution Per Unit | Percentage Distributed to General Partner and IDUs (1) | Percentage Distributed to Limited partners | |||
Minimum Quarterly Distribution | Up to $0.5435 | 2% | 98% | |||
First Target Distribution | > $0.5435 | 25% | 75% |
(1) | For distributions in excess of the Minimum Quarterly Distribution, this percentage includes both the General Partner’s distributions of 2% and the distribution to the Incentive Distribution Unit holder, a wholly-owned subsidiary of our General Partner. |
We determined basic and diluted net income per limited partner unit as follows:
For the three months | For the six months | |||||||||||||||
ended June 30, | ended June 30, | |||||||||||||||
2016 | 2015 | 2016 | 2015 | |||||||||||||
(in millions, except per unit amounts) | ||||||||||||||||
Net income (loss) | $ | 177.7 | $ | (60.5 | ) | $ | 350.1 | $ | 157.3 | |||||||
Less: Net income attributable to: | ||||||||||||||||
Noncontrolling interest | 70.3 | 10.0 | 139.1 | 61.3 | ||||||||||||
Series 1 preferred unit distributions | 22.5 | 22.5 | 45.0 | 45.0 | ||||||||||||
Accretion of discount on Series 1 preferred units | 1.2 | 4.1 | 2.3 | 8.0 | ||||||||||||
Net income (loss) attributable to general and limited partner interests in Enbridge Energy Partners, L.P. | 83.7 | (97.1 | ) | 163.7 | 43.0 | |||||||||||
Distributions: | ||||||||||||||||
Incentive distributions | (5.2 | ) | (5.1 | ) | (10.4 | ) | (8.5 | ) | ||||||||
Distributed earnings attributed to our General Partner | (5.3 | ) | (5.2 | ) | (10.5 | ) | (10.2 | ) | ||||||||
Distributed earnings attributed to Class D and Class E units | (49.1 | ) | (49.1 | ) | (98.2 | ) | (97.1 | ) | ||||||||
Total distributed earnings to our General Partner, Class D and Class E units and IDUs | (59.6 | ) | (59.4 | ) | (119.1 | ) | (115.8 | ) | ||||||||
Total distributed earnings attributed to our common units and i-units | (202.9 | ) | (198.5 | ) | (404.6 | ) | (392.0 | ) | ||||||||
Total distributed earnings | (262.5 | ) | (257.9 | ) | (523.7 | ) | (507.8 | ) | ||||||||
Overdistributed earnings | $ | (178.8 | ) | $ | (355.0 | ) | $ | (360.0 | ) | $ | (464.8 | ) | ||||
Weighted average common units and i-units outstanding | 347.1 | 339.9 | 345.9 | 336.3 | ||||||||||||
Basic and diluted earnings per unit: | ||||||||||||||||
Distributed earnings per common unit and i-unit (1) | $ | 0.58 | $ | 0.58 | $ | 1.17 | $ | 1.17 | ||||||||
Overdistributed earnings per common unit and i-unit (2) | (0.50 | ) | (1.02 | ) | (1.02 | ) | (1.35 | ) | ||||||||
Net income (loss) per common unit and i-unit (basic and diluted) (3) | $ | 0.08 | $ | (0.44 | ) | $ | 0.15 | $ | (0.18 | ) |
(1) | Represents the total distributed earnings to common units and i-units divided by the weighted average number of common units and i-units outstanding for the period. |
(2) | Represents the common units’ and i-units’ share (98%) of distributions in excess of earnings divided by the weighted average number of common units and i-units outstanding for the period and overdistributed earnings allocated to the common units and i-units based on the distribution waterfall that is outlined in our partnership agreement. |
(3) | For the three and six months ended June 30, 2016 and 2015, 43,201,310 anti-dilutive Preferred units, 66,100,000 anti-dilutive Class D units and 18,114,975 anti-dilutive Class E units were excluded from the if-converted method of calculating diluted earnings per unit. |
5
SEGMENT INFORMATION
Our business is divided into operating segments, defined as components of the enterprise, about which financial information is available and evaluated regularly by our Chief Operating Decision Maker, collectively comprised of our senior management, in deciding how resources are allocated and performance is assessed.
Each of our reportable segments is a business unit that offers different services and products that are managed separately, because each business segment requires different operating strategies. We have segregated our business activities into two distinct operating segments:
· | Liquids; and |
· | Natural Gas. |
The following tables present certain financial information relating to our business segments and corporate activities:
For the three months ended June 30, 2016 | ||||||||||||||||
Liquids | Natural Gas | Corporate (1) | Total | |||||||||||||
(in millions) | ||||||||||||||||
Operating revenues: (2) | ||||||||||||||||
Commodity sales | $ | - | $ | 380.8 | $ | - | $ | 380.8 | ||||||||
Transportation and other services | 621.3 | 46.8 | - | 668.1 | ||||||||||||
621.3 | 427.6 | - | 1,048.9 | |||||||||||||
Operating expenses: | ||||||||||||||||
Commodity costs | - | 359.1 | - | 359.1 | ||||||||||||
Environmental costs, net of recoveries | 0.1 | - | - | 0.1 | ||||||||||||
Operating and administrative | 132.1 | 78.0 | 2.7 | 212.8 | ||||||||||||
Power | 59.7 | - | - | 59.7 | ||||||||||||
Asset impairment | - | 10.6 | - | 10.6 | ||||||||||||
Depreciation and amortization | 104.9 | 40.0 | - | 144.9 | ||||||||||||
296.8 | 487.7 | 2.7 | 787.2 | |||||||||||||
Operating income (loss) | 324.5 | (60.1 | ) | (2.7 | ) | 261.7 | ||||||||||
Interest expense, net | - | - | (101.5 | ) | (101.5 | ) | ||||||||||
Allowance for equity used during construction | - | - | 13.3 | 13.3 | ||||||||||||
Other income | - | 6.6 | (3) | 0.1 | 6.7 | |||||||||||
Income (loss) before income tax expense | 324.5 | (53.5 | ) | (90.8 | ) | 180.2 | ||||||||||
Income tax expense | - | - | (2.5 | ) | (2.5 | ) | ||||||||||
Net income (loss) | 324.5 | (53.5 | ) | (93.3 | ) | 177.7 | ||||||||||
Less: Net income attributable to: | ||||||||||||||||
Noncontrolling interest | - | - | 70.3 | 70.3 | ||||||||||||
Series 1 preferred unit distributions | - | - | 22.5 | 22.5 | ||||||||||||
Accretion of discount on Series 1 preferred units | - | - | 1.2 | 1.2 | ||||||||||||
Net income (loss) attributable to general and limited partner | ||||||||||||||||
ownership interests in Enbridge Energy Partners, L.P. | $ | 324.5 | $ | (53.5 | ) | $ | (187.3 | ) | $ | 83.7 |
(1) | Corporate consists of interest expense, allowance for equity used during construction, noncontrolling interest and other costs such as income taxes, which are not allocated to the business segments. |
(2) | There were no intersegment revenues for the three months ended June 30, 2016. |
(3) | Other income for our Natural Gas segment includes our equity investment in the Texas Express NGL system. |
6
For the three months ended June 30, 2015 | ||||||||||||||||
Liquids | Natural Gas | Corporate (1) | Total | |||||||||||||
(in millions) | ||||||||||||||||
Operating revenues: (2) | ||||||||||||||||
Commodity sales | $ | - | $ | 731.1 | $ | - | $ | 731.1 | ||||||||
Transportation and other services | 533.0 | 49.0 | - | 582.0 | ||||||||||||
533.0 | 780.1 | - | 1,313.1 | |||||||||||||
Operating expenses: | ||||||||||||||||
Commodity costs | - | 670.6 | - | 670.6 | ||||||||||||
Environmental costs, net of recoveries | (0.8 | ) | - | - | (0.8 | ) | ||||||||||
Operating and administrative | 116.3 | 87.3 | 3.6 | 207.2 | ||||||||||||
Power | 57.2 | - | - | 57.2 | ||||||||||||
Goodwill impairment | - | 246.7 | - | 246.7 | ||||||||||||
Asset impairment | - | 12.3 | - | 12.3 | ||||||||||||
Depreciation and amortization | 88.7 | 40.8 | - | 129.5 | ||||||||||||
261.4 | 1,057.7 | 3.6 | 1,322.7 | |||||||||||||
Operating income (loss) | 271.6 | (277.6 | ) | (3.6 | ) | (9.6 | ) | |||||||||
Interest expense, net | - | - | (78.0 | ) | (78.0 | ) | ||||||||||
Allowance for equity used during construction | - | - | 17.3 | 17.3 | ||||||||||||
Other income | - | 5.9 | (3) | 0.1 | 6.0 | |||||||||||
Income (loss) before income tax benefit | 271.6 | (271.7 | ) | (64.2 | ) | (64.3 | ) | |||||||||
Income tax benefit | - | - | 3.8 | 3.8 | ||||||||||||
Net income (loss) | 271.6 | (271.7 | ) | (60.4 | ) | (60.5 | ) | |||||||||
Less: Net income attributable to: | ||||||||||||||||
Noncontrolling interest | - | - | 10.0 | 10.0 | ||||||||||||
Series 1 preferred unit distributions | - | - | 22.5 | 22.5 | ||||||||||||
Accretion of discount on Series 1 preferred units | - | - | 4.1 | 4.1 | ||||||||||||
Net income (loss) attributable to general and limited partner | ||||||||||||||||
ownership interests in Enbridge Energy Partners, L.P. | $ | 271.6 | $ | (271.7 | ) | $ | (97.0 | ) | $ | (97.1 | ) |
(1) | Corporate consists of interest expense, allowance for equity used during construction, noncontrolling interest and other costs such as income taxes, which are not allocated to the business segments. |
(2) | There were no intersegment revenues for the three months ended June 30, 2015. |
(3) | Other income for our Natural Gas segment includes our equity investment in the Texas Express NGL system. |
7
As of and for the six months ended June 30, 2016 | ||||||||||||||||
Liquids | Natural Gas | Corporate (1) | Total | |||||||||||||
(in millions) | ||||||||||||||||
Operating revenues: (2) | ||||||||||||||||
Commodity sales | $ | - | $ | 763.8 | $ | - | $ | 763.8 | ||||||||
Transportation and other services | 1,251.0 | 95.7 | - | 1,346.7 | ||||||||||||
1,251.0 | 859.5 | - | 2,110.5 | |||||||||||||
Operating expenses: | ||||||||||||||||
Commodity costs | - | 707.1 | - | 707.1 | ||||||||||||
Environmental costs, net of recoveries | 17.0 | - | - | 17.0 | ||||||||||||
Operating and administrative | 268.9 | 152.3 | 6.2 | 427.4 | ||||||||||||
Power | 132.5 | - | - | 132.5 | ||||||||||||
Asset impairment | 0.4 | 10.6 | - | 11.0 | ||||||||||||
Depreciation and amortization | 206.3 | 79.5 | - | 285.8 | ||||||||||||
625.1 | 949.5 | 6.2 | 1,580.8 | |||||||||||||
Operating income (loss) | 625.9 | (90.0 | ) | (6.2 | ) | 529.7 | ||||||||||
Interest expense, net | - | - | (214.4 | ) | (214.4 | ) | ||||||||||
Allowance for equity used during construction | - | - | 25.6 | 25.6 | ||||||||||||
Other income | - | 13.7 | (3) | 0.5 | 14.2 | |||||||||||
Income (loss) before income tax expense | 625.9 | (76.3 | ) | (194.5 | ) | 355.1 | ||||||||||
Income tax expense | - | - | (5.0 | ) | (5.0 | ) | ||||||||||
Net income (loss) | 625.9 | (76.3 | ) | (199.5 | ) | 350.1 | ||||||||||
Less: Net income attributable to: | ||||||||||||||||
Noncontrolling interest | - | - | 139.1 | 139.1 | ||||||||||||
Series 1 preferred unit distributions | - | - | 45.0 | 45.0 | ||||||||||||
Accretion of discount on Series 1 preferred units | - | - | 2.3 | 2.3 | ||||||||||||
Net income (loss) attributable to general and limited partner | ||||||||||||||||
ownership interests in Enbridge Energy Partners, L.P. | $ | 625.9 | $ | (76.3 | ) | $ | (385.9 | ) | $ | 163.7 | ||||||
Total assets | $ | 13,822.4 | $ | 4,952.8 | (4) | $ | 138.3 | $ | 18,913.5 | |||||||
Capital expenditures (excluding acquisitions) | $ | 470.9 | $ | 28.0 | $ | 0.7 | $ | 499.6 |
(1) | Corporate consists of interest expense, allowance for equity used during construction, noncontrolling interest and other costs such as income taxes, which are not allocated to the business segments. |
(2) | There were no intersegment revenues for the six months ended June 30, 2016. |
(3) | Other income for our Natural Gas segment includes our equity investment in the Texas Express NGL system. |
(4) | Total assets for our Natural Gas segment includes $364.8 million for our equity investment in the Texas Express NGL system. |
8
As of and for the six months ended June 30, 2015 | ||||||||||||||||
Liquids | Natural Gas | Corporate (1) | Total | |||||||||||||
(in millions) | ||||||||||||||||
Operating revenues: (2) | ||||||||||||||||
Commodity sales | $ | - | $ | 1,553.8 | $ | - | $ | 1,553.8 | ||||||||
Transportation and other services | 1,088.1 | 99.8 | - | 1,187.9 | ||||||||||||
1,088.1 | 1,653.6 | - | 2,741.7 | |||||||||||||
Operating expenses: | ||||||||||||||||
Commodity costs | - | 1,449.7 | - | 1,449.7 | ||||||||||||
Environmental costs, net of recoveries | - | - | - | - | ||||||||||||
Operating and administrative | 246.7 | 170.0 | 7.6 | 424.3 | ||||||||||||
Power | 120.8 | - | - | 120.8 | ||||||||||||
Goodwill impairment | - | 246.7 | - | 246.7 | ||||||||||||
Asset impairment | - | 12.3 | - | 12.3 | ||||||||||||
Depreciation and amortization | 178.8 | 79.1 | - | 257.9 | ||||||||||||
546.3 | 1,957.8 | 7.6 | 2,511.7 | |||||||||||||
Operating income (loss) | 541.8 | (304.2 | ) | (7.6 | ) | 230.0 | ||||||||||
Interest expense, net | - | - | (126.3 | ) | (126.3 | ) | ||||||||||
Allowance for equity used during construction | - | - | 40.3 | 40.3 | ||||||||||||
Other income | - | 11.6 | (3) | 0.3 | 11.9 | |||||||||||
Income (loss) before income tax benefit | 541.8 | (292.6 | ) | (93.3 | ) | 155.9 | ||||||||||
Income tax benefit | - | - | 1.4 | 1.4 | ||||||||||||
Net income (loss) | 541.8 | (292.6 | ) | (91.9 | ) | 157.3 | ||||||||||
Less: Net income attributable to: | ||||||||||||||||
Noncontrolling interest | - | - | 61.3 | 61.3 | ||||||||||||
Series 1 preferred unit distributions | - | - | 45.0 | 45.0 | ||||||||||||
Accretion of discount on Series 1 preferred units | - | - | 8.0 | 8.0 | ||||||||||||
Net income (loss) attributable to general and limited partner | ||||||||||||||||
ownership interests in Enbridge Energy Partners, L.P. | $ | 541.8 | $ | (292.6 | ) | $ | (206.2 | ) | $ | 43.0 | ||||||
Total assets | $ | 12,563.3 | $ | 5,256.5 | (4) | $ | 173.3 | $ | 17,993.1 | |||||||
Capital expenditures (excluding acquisitions) | $ | 909.0 | $ | 104.6 | $ | 13.9 | $ | 1,027.5 |
(1) | Corporate consists of interest expense, allowance for equity used during construction, noncontrolling interest and other costs such as income taxes, which are not allocated to the business segments. |
(2) | There were no intersegment revenues for the six months ended June 30, 2015. |
(3) | Other income for our Natural Gas segment includes our equity investment in the Texas Express NGL system. |
(4) | Total assets for our Natural Gas segment includes $376.2 million for our equity investment in the Texas Express NGL system. |
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