Debt and Financing Arrangements (Notes)

3 Months Ended

Mar. 31, 2016

Debt Disclosure [Abstract]

Debt and Financing Arrangements

DEBT AND FINANCING ARRANGEMENTS

Credit Facility

We along with WPZ and Northwest Pipeline LLC, are party to a credit agreement with aggregate commitments available of $3.5 billion, with up to an additional $500 million increase in aggregate commitments available under certain circumstances. Total letter of credit capacity available to WPZ under this credit facility is $1.125 billion. We are able to borrow up to $500 million under this credit facility to the extent not otherwise utilized by the other co-borrowers. At March 31, 2016, no letters of credit have been issued and $625 million of loans to WPZ are outstanding under the credit facility.

WPZ participates in a commercial paper program, and WPZ management considers amounts outstanding under this program to be a reduction of available capacity under the credit facility. The program allows a maximum outstanding amount at any time of $3 billion of unsecured commercial paper notes. At March 31, 2016, WPZ had $135 million of commercial paper outstanding.

Long-Term Debt Due Within One Year

The long-term debt due within one year at March 31, 2016 is associated with the $200 million of 6.4 percent notes maturing on April 15, 2016.

Issuance and Retirement of Long-Term Debt

On January 22, 2016, we issued $1 billion of 7.85 percent senior unsecured notes due 2026 to investors in a private debt placement. A portion of these proceeds was used to retire our $200 million of 6.4 percent notes that matured on April 15, 2016. We will use the remainder for funding of capital expenditures. As part of the new issuance, we entered into a registration rights agreement with the initial purchasers of the unsecured notes. We are obligated to file and consummate a registration statement for an offer to exchange the notes for a new issue of substantially identical notes registered under the Securities Act of 1933, as amended, within 365 days from closing and to use commercially reasonable efforts to complete the exchange offer. We are required to provide a shelf registration statement to cover resales of the notes under certain circumstances. If we fail to fulfill these obligations, additional interest will accrue on the affected securities. The rate of additional interest will be 0.25 percent per annum on the principal amount of the affected securities for the first 90-day period immediately following the occurrence of default, increasing by an additional 0.25 percent per annum with respect to each subsequent 90-day period thereafter, up to a maximum amount for all such defaults of 0.5 percent annually. Following the cure of any registration defaults, the accrual of additional interest will cease.