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New words:
ceased, delisted, deregister, forfeited, hand, inception, NYSE, offering, office, reduction, restore, stipulated, sublet, suspend, underwriting, vacated
Removed:
close, domestic, ending, entitled, granted, identify, indeterminate, intent, issue, leverage, PRB, Private, rationalization, Reform, registration, reliability, shelf, subordinated, vested
Financial report summary
?Risks
- Our business could be negatively impacted by inflationary pressures which may decrease our operating margins and increase working capital investments required to operate our business.
- Our cash flow is affected by natural gas, NGL and crude oil prices.
- Market conditions, including commodity prices, may impact our earnings, financial condition and cash flows.
- The amount of natural gas we gather, compress, treat, process, transport, store and sell, or the NGLs we produce, fractionate, transport, store and sell, may be reduced if the pipelines, storage and fractionation facilities to which we deliver the natural gas or NGLs are capacity constrained and cannot, or will not, accept the natural gas or NGLs or we may be required to find alternative markets and arrangements for our natural gas and NGLs.
- Our hedging activities and the application of fair value measurements may have a material adverse effect on our earnings, profitability, cash flows, liquidity and financial condition.
- We could incur losses due to impairment in the carrying value of our long-lived assets.
- Volumes of natural gas dedicated to our systems in the future may be less than we anticipate.
- We depend on certain natural gas producer customers for a significant portion of our supply of natural gas and NGLs.
- Because of the natural decline in production from existing wells, our success depends on our ability to obtain new sources of supplies of natural gas and NGLs.
- Third party pipelines and other facilities interconnected to our natural gas and NGL pipelines and facilities may become unavailable to transport, process or produce natural gas and NGLs.
- We have a holding company structure in which our subsidiaries conduct our operations and own our operating assets.
- We may incur significant costs and liabilities resulting from implementing and administering pipeline and asset integrity programs and related repairs.
- We are exposed to the credit risks of our producer customers and counterparties, and any material nonpayment or nonperformance by our producer customers or counterparties could reduce our ability to make distributions to our unitholders.
- We have partial ownership interests in various joint ventures, which could adversely affect our ability to operate and control these entities. In addition, we may be unable to control the amount of cash we will receive from the operation of these entities and we could be required to contribute significant cash to fund our share of their operations, which could adversely affect our ability to distribute cash to our unitholders.
- Our business involves many hazards and operational risks, some of which may not be fully covered by insurance.
- We have and will continue to incur substantial transaction-related costs in connection with the Merger. If the Merger does not occur, we will not benefit from these costs.
- Federal executive, legislative, and regulatory initiatives relating to oil and gas operations could adversely affect our operations and those of our third-party customers.
- State agency rulemakings in New Mexico could increase our operational costs, and potentially impact new oil and gas development activity by our producer customers.
- Laws and corresponding rulemakings in Colorado could have a material adverse impact on new oil and gas development in the state and could reduce the demand for our services in the state.
- We may incur significant costs and liabilities in the future resulting from a failure to comply with existing or new environmental regulations or an accidental release of hazardous substances or hydrocarbons into the environment.
- A change in the jurisdictional characterization of some of our assets by federal, state or local regulatory agencies or a change in policy by those agencies may result in increased regulation of our assets.
- The interstate tariff rates of certain of our pipelines are subject to review and possible adjustment by federal regulators.
- The transportation rates for our NGL pipelines that provide interstate transportation services, our interstate natural gas pipelines, and our intrastate pipelines that provide interstate services under Section 311 of the NGPA could be adversely impacted by FERC’s revised income tax allowance policy for partnership pipelines and the federal law reducing the corporate income tax rate.
- Rules imposing more stringent requirements on the oil and gas industry could cause our customers and us to incur increased capital expenditures and operating costs as well as reduce the demand for our services.
- We may incur significant costs in the future associated with proposed climate change regulation and legislation.
- Increased regulation of hydraulic fracturing could result in reductions, delays or increased costs in drilling and completing new oil and natural gas wells, which could adversely impact our revenues by decreasing the volumes of natural gas and natural gas liquids that we gather, process and transport.
- Construction of new assets is subject to regulatory, environmental, political, legal, economic, civil protest, and other risks that may adversely affect our financial results.
- Our increasing dependence on digital technology puts us at risk for a cyber incident that could result in information theft, data corruption, operational disruption or financial loss.
- Our business could be negatively impacted by security threats, including cybersecurity threats, terrorist attacks, the threat of terrorist attacks and related disruptions.
- The outstanding senior notes and junior subordinated notes, or notes, are unsecured obligations of our operating subsidiary, DCP Midstream Operating, LP, or DCP Operating, and are not guaranteed by any of our subsidiaries. As a result, our notes are effectively junior to DCP Operating’s existing and future secured debt and to all debt and other liabilities of its subsidiaries.
- Our significant indebtedness and the restrictions in our debt agreements may adversely affect our future financial and operating flexibility.
- Conflicts of interest may exist between our individual unitholders and Phillips 66, which has the authority to conduct, direct and manage the activities of DCP Midstream, LLC associated with the Partnership and our general partner.
- Our Partnership Agreement restricts the remedies available to holders of our units for actions taken by our general partner that might otherwise constitute breaches of fiduciary duty.
- Our units may experience price volatility.
- Even if our unitholders are dissatisfied, they may be unable to remove our general partner without its consent.
- We are prohibited from paying distributions on our common units if distributions on our Preferred Units are in arrears.
- Our general partner including its affiliates may sell units in the public or private markets, which could reduce the market price of our outstanding common units.
- Our Preferred Units are subordinated to our existing and future debt obligations, and your interests could be diluted by the issuance of additional units, including additional Preferred Units, and by other transactions.
- We distribute all of our available cash to our common unitholders and are not required to accumulate cash for the purpose of meeting our future obligations to holders of the Preferred Units, which may limit the cash available to make distributions on the Preferred Units.
- Changes in tax laws could adversely affect our performance.
- Our unitholders may be required to pay taxes on income from us even if the unitholders do not receive any cash distributions from us.
- Certain actions that we may take, such as issuing additional units, may increase the federal income tax liability of unitholders.
- Tax gain or loss on disposition of common units could be more or less than expected.
- Our unitholders may be subject to limitation on their ability to deduct interest expense incurred by us.
- We treat each purchaser of our common units as having the same tax benefits without regard to the actual common units purchased. The IRS may challenge this treatment, which could adversely affect the value of the common units.
- We have adopted certain valuation methodologies that may result in a shift of income, gain, loss and deduction between the unitholders. The IRS may challenge this treatment, which could adversely affect the value of the units.
- Treatment of distributions on our Preferred Units as guaranteed payments for the use of capital creates a different tax treatment for the holders of Preferred Units than the holders of our common units.
- Volatility in the capital markets may adversely impact our liquidity.
Management Discussion
- •$1,715 million decrease for our Gathering and Processing segment, primarily due to lower commodity prices and a decrease in transportation, processing and other, partially offset by higher volumes across all regions and favorable commodity derivative activity.
- •$1,515 million change in inter-segment eliminations, which relate to sales of gas and NGL volumes from our Gathering and Processing segment to our Logistics and Marketing segment, primarily due to lower commodity prices.
- •$1,501 million decrease for our Gathering and Processing segment for the commodity price and volume changes discussed above.