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 September 30, 2019 (Thousands of Dollars) NuStar Energy NuStar Logistics NuPOP Non-Guarantor Subsidiaries Eliminations Consolidated Assets Cash and cash equivalents $ 90 $ 27 $ — $ 15,237 $ — $ 15,354 Receivables, net — 82 — 130,467 — 130,549 Inventories — 1,912 4,693 3,518 — 10,123 Prepaid and other current assets 138 26,696 1,056 4,035 — 31,925 Intercompany receivable — 1,290,555 — 595,493 (1,886,048 ) — Total current assets 228 1,319,272 5,749 748,750 (1,886,048 ) 187,951 Property, plant and equipment, net — 2,044,102 610,544 1,420,694 — 4,075,340 Intangible assets, net — 42,039 — 652,449 — 694,488 Goodwill — 149,453 170,652 685,748 — 1,005,853 Investment in wholly owned subsidiaries 2,887,631 1,725,947 1,147,269 498,799 (6,259,646 ) — Other long-term assets, net 79 104,751 32,344 35,030 — 172,204 Total assets $ 2,887,938 $ 5,385,564 $ 1,966,558 $ 4,041,470 $ (8,145,694 ) $ 6,135,836 Liabilities, Mezzanine Equity and Partners’ Equity Accounts payable $ 5,411 $ 38,926 $ 6,470 $ 51,402 $ — $ 102,209 Short-term debt and current portion of finance leases — 15,442 206 16 — 15,664 Current portion of long-term debt — 453,241 — — — 453,241 Accrued interest payable — 40,867 3 32 — 40,902 Accrued liabilities 1,069 50,772 8,659 39,389 — 99,889 Taxes other than income tax 63 8,027 6,607 585 — 15,282 Income tax payable — 341 1 2,708 — 3,050 Intercompany payable 455,217 — 1,430,831 — (1,886,048 ) — Total current liabilities 461,760 607,616 1,452,777 94,132 (1,886,048 ) 730,237 Long-term debt, less current portion — 2,841,373 768 56,336 — 2,898,477 Deferred income tax liability — 1,675 9 10,413 — 12,097 Other long-term liabilities — 67,928 14,348 65,832 — 148,108 Series D preferred units 577,191 — — — — 577,191 Total partners’ equity 1,848,987 1,866,972 498,656 3,814,757 (6,259,646 ) 1,769,726 Total liabilities, mezzanine equity and partners’ equity $ 2,887,938 $ 5,385,564 $ 1,966,558 $ 4,041,470 $ (8,145,694 ) $ 6,135,836 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 September 30, 2019 (Thousands of Dollars) NuStar Energy NuStar Logistics NuPOP Non-Guarantor Subsidiaries Eliminations Consolidated Revenues $ — $ 138,159 $ 59,093 $ 180,895 $ (91 ) $ 378,056 Costs and expenses 517 86,742 37,872 153,044 (91 ) 278,084 Operating (loss) income (517 ) 51,417 21,221 27,851 — 99,972 Equity in earnings of subsidiaries 53,001 12,690 16,428 36,163 (118,282 ) — Interest income (expense), net 104 (47,741 ) (1,683 ) 2,418 — (46,902 ) Other income (expense), net — 737 196 (325 ) — 608 Income from continuing operations before income tax expense 52,588 17,103 36,162 66,107 (118,282 ) 53,678 Income tax expense — 124 — 966 — 1,090 Income from continuing operations 52,588 16,979 36,162 65,141 (118,282 ) 52,588 Loss from discontinued operations, net of tax (a) (4,777 ) — (4,776 ) (9,553 ) 14,329 (4,777 ) Net income $ 47,811 $ 16,979 $ 31,386 $ 55,588 $ (103,953 ) $ 47,811 Comprehensive income $ 47,811 $ 7,019 $ 31,386 $ 53,950 $ (103,953 ) $ 36,213 (a) Includes equity in earnings (loss) of subsidiaries related to discontinued operations. Condensed Consolidating Statements of Comprehensive Income For the Three Months Ended September 30, 2018 (Thousands of Dollars) NuStar Energy NuStar Logistics NuPOP Non-Guarantor Subsidiaries Eliminations Consolidated Revenues $ — $ 127,165 $ 62,981 $ 190,102 $ (106 ) $ 380,142 Costs and expenses 600 76,932 40,497 173,054 (106 ) 290,977 Operating (loss) income (600 ) 50,233 22,484 17,048 — 89,165 Equity in earnings of subsidiaries 44,195 9,405 9,411 30,134 (93,145 ) — Interest income (expense), net 68 (45,532 ) (1,882 ) 3,032 — (44,314 ) Other income, net — 468 119 338 — 925 Income from continuing operations before income tax expense 43,663 14,574 30,132 50,552 (93,145 ) 45,776 Income tax expense — 82 — 2,031 — 2,113 Income from continuing operations 43,663 14,492 30,132 48,521 (93,145 ) 43,663 Income from discontinued 4,473 — 4,473 8,946 (13,419 ) 4,473 Net income $ 48,136 $ 14,492 $ 34,605 $ 57,467 $ (106,564 ) $ 48,136 Comprehensive income $ 48,136 $ 19,751 $ 34,605 $ 57,109 $ (106,564 ) $ 53,037 (a) Includes equity in earnings (loss) of subsidiaries related to discontinued operations. Condensed Consolidating Statements of Comprehensive (Loss) Income For the Nine Months Ended September 30, 2019 (Thousands of Dollars) NuStar Energy NuStar Logistics NuPOP Non-Guarantor Subsidiaries Eliminations Consolidated Revenues $ — $ 385,850 $ 181,898 $ 531,042 $ (463 ) $ 1,098,327 Costs and expenses 1,892 247,182 115,157 467,699 (463 ) 831,467 Operating (loss) income (1,892 ) 138,668 66,741 63,343 — 266,860 Equity in earnings of subsidiaries 129,991 25,019 42,951 104,787 (302,748 ) — Interest income (expense), net 329 (140,213 ) (5,456 ) 8,454 — (136,886 ) Other income (expense), net — 2,234 551 (765 ) — 2,020 Income from continuing operations before income tax expense (benefit) 128,428 25,708 104,787 175,819 (302,748 ) 131,994 Income tax expense (benefit) 2 (228 ) 1 3,793 — 3,568 Income from continuing operations 128,426 25,936 104,786 172,026 (302,748 ) 128,426 (Loss) income from discontinued operations, net of tax (a) (312,527 ) 7,912 (320,439 ) (640,877 ) 953,404 (312,527 ) Net (loss) income (184,101 ) 33,848 (215,653 ) (468,851 ) 650,656 (184,101 ) Comprehensive (loss) income $ (184,101 ) $ 9,379 $ (215,653 ) $ (468,765 ) $ 650,656 $ (208,484 ) (a) Includes equity in earnings (loss) of subsidiaries related to discontinued operations. Condensed Consolidating Statements of Comprehensive Income For the Nine Months Ended September 30, 2018 (Thousands of Dollars) NuStar Energy NuStar Logistics NuPOP Non-Guarantor Subsidiaries Eliminations Consolidated Revenues $ — $ 364,721 $ 185,760 $ 596,099 $ (455 ) $ 1,146,125 Costs and expenses 1,750 235,936 118,002 541,847 (455 ) 897,080 Operating (loss) income (1,750 ) 128,785 67,758 54,252 — 249,045 Equity in earnings of subsidiaries 105,418 8,848 49,169 112,056 (275,491 ) — Interest income (expense), net 137 (145,915 ) (5,177 ) 10,864 — (140,091 ) Other income, net — 2,792 307 449 — 3,548 Income (loss) from continuing operations before income tax expense 103,805 (5,490 ) 112,057 177,621 (275,491 ) 112,502 Income tax expense — 313 1 8,383 — 8,697 Income (loss) from continuing operations 103,805 (5,803 ) 112,056 169,238 (275,491 ) 103,805 Income from discontinued 99,863 — 99,863 199,726 (299,589 ) 99,863 Net income (loss) $ 203,668 $ (5,803 ) $ 211,919 $ 368,964 $ (575,080 ) $ 203,668 Comprehensive income $ 203,668 $ 24,535 $ 211,919 $ 361,830 $ (575,080 ) $ 226,872 (a) Includes equity in earnings (loss) of subsidiaries related to discontinued operations. Condensed Consolidating Statements of Cash Flows For the Nine Months Ended September 30, 2019 (Thousands of Dollars) NuStar Energy NuStar Logistics NuPOP Non-Guarantor Subsidiaries Eliminations Consolidated Net cash provided by operating activities $ 281,988 $ 109,849 $ 88,654 $ 301,613 $ (427,443 ) $ 354,661 Cash flows from investing activities: Capital expenditures — (215,031 ) (18,451 ) (201,561 ) — (435,043 ) Change in accounts payable related to capital expenditures — 1,539 (878 ) (13,302 ) — (12,641 ) Proceeds from sale or disposition of assets — 166 34 114 — 314 Proceeds from sale of the St. Eustatius Operations (Note 3) — — — 227,709 — 227,709 Investment in subsidiaries — (11,999 ) — — 11,999 — Other, net — — — (1,100 ) — (1,100 ) Net cash (used in) provided by investing activities — (225,325 ) (19,295 ) 11,860 11,999 (220,761 ) Cash flows from financing activities: Debt borrowings — 790,000 — 28,900 — 818,900 Debt repayments — (1,097,000 ) — (34,100 ) — (1,131,100 ) Note offering, net of issuance costs — 491,588 — — — 491,588 Distributions to preferred unitholders (91,269 ) (45,635 ) (45,635 ) (45,640 ) 136,910 (91,269 ) Distributions to common unitholders (193,683 ) (96,841 ) (96,841 ) (96,851 ) 290,533 (193,683 ) Contributions from affiliates — — — 11,999 (11,999 ) — Net intercompany activity 10,025 92,218 73,196 (175,439 ) — — Payment of tax withholding for unit-based compensation (6,578 ) — — — — (6,578 ) Other, net (1,648 ) (10,108 ) (79 ) (124 ) — (11,959 ) Net cash (used in) provided by financing activities (283,153 ) 124,222 (69,359 ) (311,255 ) 415,444 (124,101 ) Effect of foreign exchange rate changes on cash — — — 681 — 681 Net (decrease) increase in cash, cash equivalents and restricted cash (1,165 ) 8,746 — 2,899 — 10,480 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 $ 90 $ 8,797 $ — $ 15,237 $ — $ 24,124 Condensed Consolidating Statements of Cash Flows For the Nine Months Ended September 30, 2018 (Thousands of Dollars) NuStar Energy NuStar Logistics NuPOP Non-Guarantor Subsidiaries Eliminations Consolidated Net cash provided by operating activities $ 296,475 $ 60,254 $ 90,482 $ 361,320 $ (445,211 ) $ 363,320 Cash flows from investing activities: Capital expenditures — (32,270 ) (14,002 ) (292,168 ) — (338,440 ) Change in accounts payable related to capital expenditures — 2,063 (6,209 ) (14,484 ) — (18,630 ) Investment in other long-term assets — — — (3,280 ) — (3,280 ) Proceeds from sale or disposition of assets — 1,464 20 736 — 2,220 Proceeds from insurance recoveries — — — 78,419 — 78,419 Acquisitions — — (37,502 ) — — (37,502 ) Net cash used in investing activities — (28,743 ) (57,693 ) (230,777 ) — (317,213 ) Cash flows from financing activities: Debt borrowings — 1,498,853 — 25,100 — 1,523,953 Debt repayments — (1,754,798 ) — (23,700 ) — (1,778,498 ) Issuance of Series D preferred units 590,000 — — — — 590,000 Payment of issuance costs for (34,187 ) — — — — (34,187 ) Issuance of common units, including general partner contribution 10,204 — — — — 10,204 Distributions to preferred unitholders (60,249 ) (30,123 ) (30,124 ) (30,123 ) 90,372 (60,247 ) Distributions to common unitholders and general partner (236,549 ) (118,275 ) (118,274 ) (118,290 ) 354,839 (236,549 ) Cash consideration for Merger (61,411 ) — — 140 — (61,271 ) Proceeds from termination of interest rate swaps — 8,048 — — — 8,048 Net intercompany activity (501,574 ) 373,055 115,609 12,910 — — Other, net (2,430 ) (4,062 ) — (62 ) — (6,554 ) Net cash used in financing activities (296,196 ) (27,302 ) (32,789 ) (134,025 ) 445,211 (45,101 ) Effect of foreign exchange rate changes on cash — — — (719 ) — (719 ) Net increase (decrease) in cash and cash equivalents 279 4,209 — (4,201 ) — 287 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 $ 1,164 $ 4,238 $ — $ 19,177 $ — $ 24,579 |