DEBT, FINANCING ARRANGEMENTS AND LEASES

Long-Term Debt

At December 31, 2017 and 2016, long-term debt outstanding was as follows (in thousands):



	2017			2016
Debentures:
7.08% due 2026	$	7,500		$	7,500
7.25% due 2026	200,000			200,000
Total debentures	207,500			207,500

Notes:
6.05% due 2018	250,000			250,000
7.85% due 2026	1,000,000			1,000,000
5.4% due 2041	375,000			375,000
4.45% due 2042	400,000			400,000
Total notes	2,025,000			2,025,000

Other financing obligation	230,926			—

Total long-term debt, including current portion	2,463,426			2,232,500
Unamortized debt issuance costs	(15,377		)	(16,408		)
Unamortized debt premium and discount, net	(5,043		)	(5,338		)
Long-term debt due within one year	(251,430		)	—

Total long-term debt	$	2,191,576		$	2,210,754

Aggregate minimum maturities (face value) applicable to long-term debt outstanding at December 31, 2017, for the next five years, are as follows (in thousands):



2018: 6.05% Notes and other financing obligation	$	251,566
2019: Other financing obligation	$	1,721
2020: Other financing obligation	$	1,893
2021: Other financing obligation	$	2,081
2022: Other financing obligation	$	2,289

No property is pledged as collateral under any of our long-term debt issues.

Restrictive Debt Covenants

At December 31, 2017, none of our debt instruments restrict the amount of distributions to our parent, provided, however, that under the credit facility described below, we are restricted from making distributions to our parent during an event of default if we have directly incurred indebtedness under the credit facility. Our debt agreements contain restrictions on our ability to incur secured debt beyond certain levels and to guarantee certain indebtedness. The indenture governing our $1 billion of 7.85% Senior Notes due 2026 further restricts our ability to guarantee certain indebtedness.

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 used 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 were 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, within 365 days from closing and to use commercially reasonable efforts to complete the exchange offer. In January 2017, we completed an exchange of these notes for substantially identical new notes that are registered under the Securities Act.

Other Financing Obligation

During the construction of our Dalton Expansion Project, we received funding from a partner for its proportionate share of construction costs related to its undivided ownership interest in the Dalton lateral. Amounts received were recorded in Advances for construction costs and 100 percent of the costs associated with construction were capitalized on our Consolidated Balance Sheet. Upon placing the project in service during the third quarter of 2017, we began leasing this partner's undivided interest in the lateral, including the associated pipeline capacity, and reclassified approximately $235.8 million of funding previously received from our partner from Advances for construction costs to Long-Term Debt on our Consolidated Balance Sheet to reflect the financing obligation payable to our partner over an expected term of 35 years. At December 31, 2017, the amount included in Long-Term Debt on our Consolidated Balance Sheet for financing obligation is $229.4 million. As this transaction did not meet the criteria for sale leaseback accounting due to our continued involvement, it was accounted for as a financing arrangement over the course of the capacity agreement. The obligation matures in July 2052, requires monthly interest and principal payments, and bears an interest rate of approximately 10 percent.

Long-Term Debt Due Within One Year

The long-term debt due within one year at December 31, 2017 is associated with the $250 million of 6.05 percent notes maturing on June 15, 2018 and with the previously described other financing obligation.

Credit Facility

On February 2, 2015, we along with WPZ, Northwest, the lenders named therein and an administrative agent entered into the Second Amended & Restated 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. In November 2017, the maturity date of the facility was extended to February 2, 2021. However, the co-borrowers may request an additional extension of the maturity date for a one year period to allow a maturity date as late as February 2, 2022, under certain circumstances. The agreement allows for swing line loans up to aggregate amount of $150 million, subject to available capacity under the credit facility, and letters of credit commitments available to WPZ of $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 December 31, 2017, no letters of credit have been issued and no loans to WPZ were outstanding under the credit facility.

Measured as of December 31, 2017, we are in compliance with our financial covenant under the credit facility.

Various covenants may limit, among other things, a borrower's and its material subsidiaries' ability to grant certain liens supporting indebtedness, merge or consolidate, sell all or substantially all of its assets, enter into certain affiliate transactions, make certain distributions during an event of default, enter into certain restrictive agreements, and allow any material change in the nature of its business.

If an event of default with respect to a borrower occurs under the credit facility, the lenders will be able to terminate the commitments for the respective borrowers and accelerate the maturity of any loans of the defaulting borrower under the credit facility agreement and exercise other rights and remedies.

Other than swing line loans, each time funds are borrowed, the borrower must choose whether such borrowing will be an alternate base rate borrowing or a Eurodollar borrowing. If such borrowing is an alternate base rate borrowing, interest is calculated on the basis of the greater of (a) the Prime Rate, (b) the Federal Funds Effective Rate plus one half of 1 percent and (c) a periodic fixed rate equal to the London Interbank Offered Rate (LIBOR) plus 1 percent, plus, in the case of each of (a), (b) and (c), an applicable margin. If the borrowing is a Eurodollar borrowing, interest is calculated on the basis of LIBOR for the relevant period plus an applicable margin. Interest on swing line loans is calculated as the sum of the alternate base rate plus an applicable margin. The borrower is required to pay a commitment fee based on the unused portion of the credit facility. The applicable margin and the commitment fee are determined for each borrower by reference to a pricing schedule based on such borrower's senior unsecured long-term debt ratings.

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 December 31, 2017, WPZ had no outstanding commercial paper.

Lease Obligations

The future minimum lease payments under our various operating leases are as follows (in thousands):



2018	$	13,558
2019	14,890
2020	14,860
2021	14,710
2022	14,654
Thereafter	122,333
Total net minimum obligations	$	195,005

Our lease expense was $11.0 million in 2017, $10.6 million in 2016, and $10.7 million in 2015.