CONDENSED CONSOLIDATING FINANCIAL STATEMENTS | CONDENSED CONSOLIDATING FINANCIAL STATEMENTS NuStar Energy has no operations, and its assets consist mainly of its investments in 100% indirectly owned subsidiaries, NuStar Logistics and NuPOP. The senior and subordinated notes issued by NuStar Logistics are fully and unconditionally guaranteed by NuStar Energy and NuPOP. As a result, the following condensed consolidating financial statements are presented as an alternative to providing separate financial statements for NuStar Logistics and NuPOP. Condensed Consolidating Balance Sheets June 30, 2019 (Thousands of Dollars) NuStar Energy NuStar Logistics NuPOP Non-Guarantor Subsidiaries Eliminations Consolidated Assets Cash and cash equivalents $ 486 $ 332 $ — $ 14,481 $ — $ 15,299 Receivables, net — 1,692 — 115,996 — 117,688 Inventories — 1,924 3,169 4,361 — 9,454 Prepaid and other current assets 110 25,619 1,059 2,803 — 29,591 Assets held for sale — — — 301,529 — 301,529 Intercompany receivable — 1,462,583 — 397,269 (1,859,852 ) — Total current assets 596 1,492,150 4,228 836,439 (1,859,852 ) 473,561 Property, plant and equipment, net — 2,023,613 609,798 1,387,403 — 4,020,814 Intangible assets, net — 44,395 — 662,949 — 707,344 Goodwill — 149,453 170,652 685,748 — 1,005,853 Investment in wholly owned subsidiaries 2,934,489 1,713,256 1,135,618 514,958 (6,298,321 ) — Other long-term assets, net 57 103,408 32,557 36,097 — 172,119 Total assets $ 2,935,142 $ 5,526,275 $ 1,952,853 $ 4,123,594 $ (8,158,173 ) $ 6,379,691 Liabilities, Mezzanine Equity and Partners’ Equity Accounts payable $ 5,586 $ 51,193 $ 6,287 $ 65,481 $ — $ 128,547 Short-term debt and current portion of finance leases — 9,940 131 16 — 10,087 Accrued interest payable — 38,891 — 38 — 38,929 Accrued liabilities 866 28,558 8,942 31,604 — 69,970 Taxes other than income tax 8 6,090 5,955 2,007 — 14,060 Income tax payable — 217 1 1,702 — 1,920 Liabilities held for sale — — — 68,616 — 68,616 Intercompany payable 459,119 — 1,400,733 — (1,859,852 ) — Total current liabilities 465,579 134,889 1,422,049 169,464 (1,859,852 ) 332,129 Long-term debt — 3,393,447 512 62,502 — 3,456,461 Deferred income tax liability — 1,675 9 10,566 — 12,250 Other long-term liabilities — 88,772 15,471 72,708 — 176,951 Series D preferred units 572,597 — — — — 572,597 Total partners’ equity 1,896,966 1,907,492 514,812 3,808,354 (6,298,321 ) 1,829,303 Total liabilities, mezzanine equity and partners’ equity $ 2,935,142 $ 5,526,275 $ 1,952,853 $ 4,123,594 $ (8,158,173 ) $ 6,379,691 Condensed Consolidating Balance Sheets December 31, 2018 (Thousands of Dollars) NuStar Energy NuStar Logistics NuPOP Non-Guarantor Subsidiaries Eliminations Consolidated Assets Cash and cash equivalents $ 1,255 $ 51 $ — $ 10,223 $ — $ 11,529 Receivables, net — 2,212 — 108,205 — 110,417 Inventories — 1,741 5,237 1,456 — 8,434 Prepaid and other current assets 61 14,422 908 1,983 — 17,374 Assets held for sale — — — 599,347 — 599,347 Intercompany receivable — 1,327,833 — 500,583 (1,828,416 ) — Total current assets 1,316 1,346,259 6,145 1,221,797 (1,828,416 ) 747,101 Property, plant and equipment, net — 1,858,264 615,549 1,300,989 — 3,774,802 Intangible assets, net — 49,107 — 683,949 — 733,056 Goodwill — 149,453 170,652 685,748 — 1,005,853 Investment in wholly owned subsidiaries 3,355,636 1,750,256 1,425,283 857,485 (7,388,660 ) — Other long-term assets, net 304 54,429 26,716 6,879 — 88,328 Total assets $ 3,357,256 $ 5,207,768 $ 2,244,345 $ 4,756,847 $ (9,217,076 ) $ 6,349,140 Liabilities, Mezzanine Equity and Partners’ Equity Accounts payable $ 6,460 $ 39,680 $ 6,331 $ 50,651 $ — $ 103,122 Short-term debt — 18,500 — — — 18,500 Accrued interest payable — 36,253 — 40 — 36,293 Accrued liabilities 1,280 24,858 8,082 40,198 — 74,418 Taxes other than income tax 125 7,285 4,718 4,695 — 16,823 Income tax payable — 457 2 3,986 — 4,445 Liabilities held for sale — — — 69,834 — 69,834 Intercompany payable 472,790 — 1,355,626 — (1,828,416 ) — Total current liabilities 480,655 127,033 1,374,759 169,404 (1,828,416 ) 323,435 Long-term debt — 3,050,531 — 61,465 — 3,111,996 Deferred income tax liability — 1,675 9 10,744 — 12,428 Other long-term liabilities — 28,392 12,348 38,818 — 79,558 Series D preferred units 563,992 — — — — 563,992 Total partners’ equity 2,312,609 2,000,137 857,229 4,476,416 (7,388,660 ) 2,257,731 Total liabilities, mezzanine equity and partners’ equity $ 3,357,256 $ 5,207,768 $ 2,244,345 $ 4,756,847 $ (9,217,076 ) $ 6,349,140 Condensed Consolidating Statements of Comprehensive Income For the Three Months Ended June 30, 2019 (Thousands of Dollars) NuStar Energy NuStar Logistics NuPOP Non-Guarantor Subsidiaries Eliminations Consolidated Revenues $ — $ 130,136 $ 64,452 $ 178,042 $ (185 ) $ 372,445 Costs and expenses 699 83,029 41,235 154,384 (185 ) 279,162 Operating (loss) income (699 ) 47,107 23,217 23,658 — 93,283 Equity in earnings of subsidiaries 47,499 10,990 13,785 35,339 (107,613 ) — Interest income (expense), net 117 (47,016 ) (1,840 ) 3,046 — (45,693 ) Other income (expense), net — 743 178 (300 ) — 621 Income from continuing operations before income tax expense (benefit) 46,917 11,824 35,340 61,743 (107,613 ) 48,211 Income tax expense (benefit) 2 (469 ) 1 1,762 — 1,296 Income from continuing operations, net of tax 46,915 12,293 35,339 59,981 (107,613 ) 46,915 (Loss) income from discontinued operations, net of tax (a) (964 ) 7,912 (8,877 ) (17,752 ) 18,717 (964 ) Net income $ 45,951 $ 20,205 $ 26,462 $ 42,229 $ (88,896 ) $ 45,951 Comprehensive income $ 45,951 $ 11,426 $ 26,462 $ 43,049 $ (88,896 ) $ 37,992 (a) Includes equity in earnings (loss) of subsidiaries related to discontinued operations. Condensed Consolidating Statements of Comprehensive Income (Loss) For the Three Months Ended June 30, 2018 (Thousands of Dollars) NuStar Energy NuStar Logistics NuPOP Non-Guarantor Subsidiaries Eliminations Consolidated Revenues $ — $ 117,862 $ 66,505 $ 205,036 $ (147 ) $ 389,256 Costs and expenses 538 86,588 42,324 183,566 (147 ) 312,869 Operating (loss) income (538 ) 31,274 24,181 21,470 — 76,387 Equity in earnings of subsidiaries 27,410 1,692 20,655 43,183 (92,940 ) — Interest income (expense), net 37 (50,357 ) (1,724 ) 3,655 — (48,389 ) Other income (expense), net — 1,848 73 (314 ) — 1,607 Income (loss) from continuing operations before income tax expense 26,909 (15,543 ) 43,185 67,994 (92,940 ) 29,605 Income tax expense — 61 — 2,635 — 2,696 Income (loss) from continuing 26,909 (15,604 ) 43,185 65,359 (92,940 ) 26,909 Income from discontinued 2,490 — 2,490 4,980 (7,470 ) 2,490 Net income (loss) $ 29,399 $ (15,604 ) $ 45,675 $ 70,339 $ (100,410 ) $ 29,399 Comprehensive income (loss) $ 29,399 $ (9,336 ) $ 45,675 $ 61,450 $ (100,410 ) $ 26,778 (a) Includes equity in earnings (loss) of subsidiaries related to discontinued operations. Condensed Consolidating Statements of Comprehensive (Loss) Income For the Six Months Ended June 30, 2019 (Thousands of Dollars) NuStar Energy NuStar Logistics NuPOP Non-Guarantor Subsidiaries Eliminations Consolidated Revenues $ — $ 247,691 $ 122,805 $ 350,147 $ (372 ) $ 720,271 Costs and expenses 1,375 160,440 77,285 314,655 (372 ) 553,383 Operating (loss) income (1,375 ) 87,251 45,520 35,492 — 166,888 Equity in earnings of subsidiaries 76,990 12,329 26,523 68,624 (184,466 ) — Interest income (expense), net 225 (92,472 ) (3,773 ) 6,036 — (89,984 ) Other income (expense), net — 1,497 355 (440 ) — 1,412 Income from continuing operations before income tax expense (benefit) 75,840 8,605 68,625 109,712 (184,466 ) 78,316 Income tax expense (benefit) 2 (352 ) 1 2,827 — 2,478 Income from continuing operations, net of tax 75,838 8,957 68,624 106,885 (184,466 ) 75,838 (Loss) income from discontinued operations, net of tax (a) (307,750 ) 7,912 (315,663 ) (631,324 ) 939,075 (307,750 ) Net (loss) income (231,912 ) 16,869 (247,039 ) (524,439 ) 754,609 (231,912 ) Comprehensive (loss) income $ (231,912 ) $ 2,360 $ (247,039 ) $ (522,715 ) $ 754,609 $ (244,697 ) (a) Includes equity in earnings (loss) of subsidiaries related to discontinued operations. Condensed Consolidating Statements of Comprehensive Income For the Six Months Ended June 30, 2018 (Thousands of Dollars) NuStar Energy NuStar Logistics NuPOP Non-Guarantor Subsidiaries Eliminations Consolidated Revenues $ — $ 237,556 $ 122,779 $ 405,997 $ (349 ) $ 765,983 Costs and expenses 1,150 159,004 77,505 368,793 (349 ) 606,103 Operating (loss) income (1,150 ) 78,552 45,274 37,204 — 159,880 Equity in earnings (loss) of 61,223 (557 ) 39,758 81,922 (182,346 ) — Interest income (expense), net 69 (100,383 ) (3,295 ) 7,832 — (95,777 ) Other income, net — 2,324 188 111 — 2,623 Income (loss) from continuing operations before income tax expense 60,142 (20,064 ) 81,925 127,069 (182,346 ) 66,726 Income tax expense — 231 1 6,352 — 6,584 Income (loss) from continuing 60,142 (20,295 ) 81,924 120,717 (182,346 ) 60,142 Income from discontinued 95,390 — 95,390 190,780 (286,170 ) 95,390 Net income (loss) $ 155,532 $ (20,295 ) $ 177,314 $ 311,497 $ (468,516 ) $ 155,532 Comprehensive income $ 155,532 $ 4,784 $ 177,314 $ 304,721 $ (468,516 ) $ 173,835 (a) Includes equity in earnings (loss) of subsidiaries related to discontinued operations. Condensed Consolidating Statements of Cash Flows For the Six Months Ended June 30, 2019 (Thousands of Dollars) NuStar Energy NuStar Logistics NuPOP Non-Guarantor Subsidiaries Eliminations Consolidated Net cash provided by operating activities $ 187,265 $ 77,144 $ 60,539 $ 200,762 $ (284,816 ) $ 240,894 Cash flows from investing activities: Capital expenditures — (167,647 ) (9,131 ) (143,183 ) — (319,961 ) Change in accounts payable related to capital expenditures — 11,708 522 3,914 — 16,144 Proceeds from sale or disposition of assets — 71 26 46 — 143 Investment in subsidiaries — (11,999 ) — — 11,999 — Net cash used in investing activities — (167,867 ) (8,583 ) (139,223 ) 11,999 (303,674 ) Cash flows from financing activities: Debt borrowings — 570,500 — 23,800 — 594,300 Debt repayments — (785,000 ) — (22,800 ) — (807,800 ) Note offering, net of issuance costs — 491,665 — — — 491,665 Distributions to preferred unitholders (60,846 ) (30,424 ) (30,423 ) (30,425 ) 91,272 (60,846 ) Distributions to common unitholders (129,025 ) (64,512 ) (64,512 ) (64,520 ) 193,544 (129,025 ) Contributions from affiliates — — — 11,999 (11,999 ) — Net intercompany activity 9,641 (75,900 ) 43,009 23,250 — — Payment of tax withholding for unit-based compensation (6,368 ) — — — — (6,368 ) Other, net (1,436 ) (6,581 ) (30 ) (122 ) — (8,169 ) Net cash (used in) provided by financing activities (188,034 ) 99,748 (51,956 ) (58,818 ) 272,817 73,757 Effect of foreign exchange rate changes on cash — — — 261 — 261 Net (decrease) increase in cash, cash equivalents and restricted cash (769 ) 9,025 — 2,982 — 11,238 Cash, cash equivalents, and restricted cash as of the beginning of the period 1,255 51 — 12,338 — 13,644 Cash, cash equivalents and restricted cash as of the end of the period $ 486 $ 9,076 $ — $ 15,320 $ — $ 24,882 Condensed Consolidating Statements of Cash Flows For the Six Months Ended June 30, 2018 (Thousands of Dollars) NuStar Energy NuStar Logistics NuPOP Non-Guarantor Subsidiaries Eliminations Consolidated Net cash provided by operating activities $ 200,803 $ 31,209 $ 58,105 $ 261,300 $ (307,567 ) $ 243,850 Cash flows from investing activities: Capital expenditures — (17,136 ) (8,164 ) (223,221 ) — (248,521 ) Change in accounts payable related to capital expenditures — 495 (5,173 ) (14,642 ) — (19,320 ) Proceeds from sale or disposition of assets — 1,385 16 696 — 2,097 Proceeds from insurance recoveries — — — 78,419 — 78,419 Acquisitions — — (37,502 ) — — (37,502 ) Net cash used in investing activities — (15,256 ) (50,823 ) (158,748 ) — (224,827 ) Cash flows from financing activities: Debt borrowings — 1,122,272 — 11,000 — 1,133,272 Debt repayments — (1,316,621 ) — (16,900 ) — (1,333,521 ) Issuance of Series D preferred units 400,000 — — — — 400,000 Payment of issuance costs for (29,289 ) — — — — (29,289 ) Issuance of common units 10,000 — — — — 10,000 Distributions to preferred unitholders (32,713 ) (16,356 ) (16,357 ) (16,358 ) 49,071 (32,713 ) Distributions to common unitholders and general partner (172,324 ) (86,162 ) (86,162 ) (86,172 ) 258,496 (172,324 ) Proceeds from termination of interest rate swaps — 8,048 — — — 8,048 Net intercompany activity (374,973 ) 279,080 95,237 656 — — Other, net (1,493 ) (4,466 ) — (64 ) — (6,023 ) Net cash used in financing activities (200,792 ) (14,205 ) (7,282 ) (107,838 ) 307,567 (22,550 ) Effect of foreign exchange rate changes on cash — — — (421 ) — (421 ) Net increase (decrease) in cash and cash equivalents 11 1,748 — (5,707 ) — (3,948 ) Cash and cash equivalents as of the beginning of the period 885 29 — 23,378 — 24,292 Cash and cash equivalents as of the end of the period $ 896 $ 1,777 $ — $ 17,671 $ — $ 20,344 |