Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2013 |
Accounting Policies [Abstract] | ' |
Revenue Recognition | ' |
Revenue Recognition |
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Revenue for natural gas and NGL firm storage is recognized ratably over the contract period regardless of the volume of natural gas or NGL stored by the Company's customers. Revenue from natural gas firm storage is affected to a lesser extent by volumes of stored gas received and or delivered by the Company's customers. Revenue for transportation services is recognized ratably over the contract period. Transportation revenue is derived from the sale of capacity that the Company has secured on certain third party pipelines, revenues for transportation on the East Pipeline and transportation revenue from placing the North-South Facilities and the MARC I Pipeline into service in fourth calendar quarter of 2011 and 2012, respectively. Revenue from transportation services is also affected to a lesser extent by volumes of gas transported during the period. Revenue from hub services is recognized ratably over the contract period. Revenues from the sale of salt are recognized when product is shipped to the customer or when certain contractual performance requirements have otherwise been met. Revenues from the COLT Hub are recognized when the contractual services are provided, such as loading of customer rail cars. |
Credit Risk and Concentrations | ' |
Credit Risk and Concentrations |
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Inherent in the Company's contractual portfolio are certain credit risks. Credit risk is the risk of loss from nonperformance by suppliers, customers or financial counterparties to a contract. The Company takes an active role in managing credit risk and has established control procedures, which are reviewed on an ongoing basis. The Company attempts to minimize credit risk exposure through credit policies and periodic monitoring procedures as well as through customer deposits, letters of credit and entering into netting agreements that allow for offsetting counterparty receivable and payable balances for certain financial transactions, as deemed appropriate. |
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One customer, ConEdison, accounted for approximately 10% and 13% of the Company's total revenue for the three months ended September 30, 2013 and 2012, respectively, and 10% and 14% of the Company's total revenue for the nine months ended September 30, 2013 and 2012, respectively. No other customer accounted for 10% or more of the Company's total revenue in those periods. All ConEdison revenues are captured in the storage and transportation segment. |
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No customer accounted for 10% or more of the Company's consolidated accounts receivable at September 30, 2013 or December 31, 2012. |
Use of Estimates | ' |
Use of Estimates |
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The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the periods presented. Actual results could differ from those estimates. |
Inventories | ' |
Inventories |
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Inventories for storage and transportation operations, consisting primarily of natural gas, are stated at the lower of cost or market and are computed predominantly using the average cost method. Inventories for salt operations are stated at the lower of cost or market, cost being principally determined on the first-in, first-out method. All costs associated with the production of finished goods at the salt production facility are captured as inventory costs. |
Property, Plant and Equipment | ' |
Property, Plant and Equipment |
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Property, plant and equipment are stated at historical cost less accumulated depreciation. The Company capitalizes all construction related direct labor and material costs as well as the cost of funds used during construction. Amounts capitalized for cost of funds used during construction amounted to $1.2 million and $1.3 million during the three months ended September 30, 2013, and 2012, respectively, and $3.3 million and $3.5 million during the nine months ended September 30, 2013, and 2012, respectively. Depreciation is computed by the straight-line method over the estimated useful lives of the assets, as follows: |
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| Years |
Buildings and improvements | 15-25 | |
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Office furniture and equipment | 7-Mar | |
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Vehicles | 5-Mar | |
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Pipelines | 15 | |
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Base gas | 10 | |
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Plant equipment | 20-Mar | |
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Salt deposits are depleted on a unit of production method. Maintenance and repairs are charged to expense as incurred. |
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The Company reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If such events or changes in circumstances are present, a loss is recognized if the carrying value of the asset is in excess of the sum of the undiscounted cash flows expected to result from the use of the asset and its eventual disposition. An impairment loss is measured as the amount by which the carrying amount of the asset exceeds the fair value of the asset. The Company has not identified any indicators that suggest the carrying amount of an asset may not be recoverable for the period ended September 30, 2013. |
Identifiable Intangible Assets and Goodwill | ' |
Identifiable Intangible Assets |
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Intangible assets acquired in the acquisition of a business are required to be separately recognized if the benefit of the intangible asset is obtained through contractual or other legal rights, or if the intangible asset can be sold, transferred, licensed, rented or exchanged, regardless of the acquirer's intent to do so. Deferred financing costs represent financing costs incurred in obtaining financing and are being amortized over the term of the related debt. |
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The Company has recorded certain identifiable intangible assets, which are amortized over their estimated economic lives, as follows: |
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| Years | |
Customer accounts | 15-20 | |
Covenants not to compete | 5-Mar | |
Deferred financing costs | 8-May | |
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Goodwill |
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Goodwill is recognized for various acquisitions by the Company as the excess of the cost of the acquisitions over the fair value of the related net assets at the date of acquisition. Goodwill is subject to at least an annual assessment for impairment by applying a fair-value-based test. |
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The Company completed its annual impairment test for each of its reporting units and determined that no impairment existed as of September 30, 2012. No indicators of impairment were identified requiring an interim impairment test during the period ended September 30, 2013. As discussed in Note 1, the Company's fiscal year-end was changed from September 30 to December 31. |
Income Taxes | ' |
Income Taxes |
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The Company is generally not subject to federal or state income tax. Therefore, the earnings of the Company are included in the federal and state income tax returns of its common unitholders and, prior to CEQP's distribution of its common units of the Company, the limited partners of CEQP. Net earnings for financial statement purposes may differ significantly from taxable income reportable to unitholders as a result of differences between the tax basis and the financial reporting basis of assets and liabilities and the taxable income allocation requirements under the Company's partnership agreement. |
Cash and Cash Equivalents | ' |
Cash and Cash Equivalents |
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The Company defines cash equivalents as all highly liquid investments with maturities of three months or less when purchased. |
Income Per Unit | ' |
Income Per Unit |
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The Company calculates basic net income per limited partner unit by utilizing the two class method. Earnings (net income available to partners) of US Salt are presented only for the period subsequent to the acquisition on May 14, 2012. Basic and diluted net income per unit are the same, as there were no potentially dilutive units outstanding at September 30, 2013 or 2012. |
Fair Value | ' |
Fair Value |
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The carrying amounts of cash, accounts receivable and accounts payable approximate their fair value. As of September 30, 2013, the estimated fair value of the Company's fixed-rate senior notes, based on available trading information, totaled $497.8 million compared with the aggregate principal amount at maturity of $500.0 million. The fair value of debt was determined based on market quotes from Bloomberg. This valuation methodology is considered level 2 in the fair value hierarchy. At September 30, 2013, the Company's $600.0 million revolving credit facility had amounts outstanding of $37.0 million, which approximated fair value due primarily to the floating interest rate associated with borrowings under the credit facility. |
Allocation of Expenses | ' |
Allocation of Expenses |
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The Company shares common management, operating and administrative and overhead costs with CEQP. The shared costs allocated to the Company totaled $4.9 million (including $3.0 million of unit-based compensation charges) and $4.6 million (including $2.7 million of unit-based compensation charges) for the three months ended September 30, 2013 and 2012, respectively, and $21.7 million (including $15.8 million of unit-based compensation charges) and $9.8 million (including $4.9 million of unit-based compensation charges) for the nine months ended September 30, 2013 and 2012, respectively. The increase in allocated unit-based compensation charges is due to the accelerated vesting of certain restricted stock units as a result of the Crestwood Merger and payment of cash to CEQP restricted unitholders in lieu of Inergy Midstream limited partner units to compensate for the distribution of 100% of the Company’s shares held by CEQP. In conjunction with its IPO, the Company entered into an Omnibus Agreement with CEQP that requires the Company to reimburse CEQP for all shared costs incurred on its behalf, except for certain unit based compensation which are treated as capital transactions. Due to the nature of these shared costs, it is not practicable to estimate what the costs would have been on a stand-alone basis. Accordingly, the accompanying financial statements may not necessarily be indicative of the conditions that would have existed, or the results of operations that would have occurred, if the Company had operated as a stand-alone entity. |
Comprehensive Income (Loss) | ' |
Comprehensive Income (Loss) |
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Comprehensive income includes net income and other comprehensive income. Other comprehensive income includes the realized loss on a derivative instrument that the Company entered into to hedge the purchase of base gas for one storage facility. The amount included in other comprehensive income associated with this derivative is being reclassified to earnings over the same period that the hedged base gas is recorded in earnings. The amount reclassified to earnings for the nine-month periods ended September 30, 2013 and 2012 was $0.1 million. |
Property Tax Receivable | ' |
Property Tax Receivable |
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The Company receives property tax benefits under New York's Empire State Development program. The amounts due to be refunded to the Company under this program amounted to $6.4 million and $4.8 million at September 30, 2013 and December 31, 2012, respectively. At September 30, 2013, $2.0 million of the amounts due to be refunded were classified in prepaid expenses and other current assets, and $4.4 million were classified in other long-term assets on the consolidated balance sheets. At December 31, 2012, $2.0 million of the amounts due to be refunded were classified in prepaid expenses and other current assets, and $2.8 million were classified in other long-term assets on the consolidated balance sheets. |
Prepaid Property Taxes | ' |
Prepaid Property Taxes |
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The Company prepays property taxes in certain taxing jurisdictions and thus records the amount of taxes relating to future periods in prepaid expenses and other current assets, which totaled $2.2 million and $1.2 million at September 30, 2013 and December 31, 2012, respectively. |
Construction Work in Process Accrual | ' |
Property, Plant and Equipment Accrual |
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The Company has accrued for property, plant and equipment, including certain construction work in process relating to construction efforts on various growth projects. At September 30, 2013 the Company had accrued $9.0 million relating to property, plant and equipment, of which $5.8 million was classified as accrued expenses and $3.2 million was classified as accounts payable on the consolidated balance sheets. At December 31, 2012 the Company had accrued $28.4 million relating to property, plant and equipment, of which $27.3 million was classified as accrued expenses and $1.1 million was classified as accounts payable on the consolidated balance sheets. |
Asset Retirement Obligations | ' |
Asset Retirement Obligations |
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An asset retirement obligation ("ARO") is an estimated liability for the cost to retire a tangible asset. The fair value of these AROs could not be made as settlement dates (or range of dates) associated with these assets were not estimable. |
Accounting for Unit-Based Compensation | ' |
Accounting for Unit-Based Compensation |
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The Company has a unit-based employee compensation plan and all share-based payments to employees, including grants of employee stock options, are recognized in the income statement based on their fair values. The amount of compensation expense recorded by the Company during the three months ended September 30, 2013 was $4.1 million ($3.0 million allocated by CEQP for CEQP units and $1.1 million for the Company units). The amount of compensation expense allocated to the Company during the three months ended September 30, 2012 was $3.4 million ($2.7 million allocated by CEQP for CEQP units and $0.7 million for the Company units). The amount of compensation expense recorded by the Company during the nine months ended September 30, 2013 was $18.7 million ($15.8 million allocated by CEQP for CEQP units and $2.9 million for the Company units). The amount of compensation expense allocated to the Company during the nine months ended September 30, 2012 was $5.6 million ($4.9 million allocated by CEQP for CEQP units and $0.7 million for the Company units). |
Segment Information | ' |
Segment Information |
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There are certain accounting requirements that establish standards for reporting information about operating segments, as well as related disclosures about products and services, geographic areas and major customers. Further, they define operating segments as components of an enterprise for which separate financial information is available that is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and assess performance. In determining its operating segments, the Company examined the way it organizes its business internally for making operating decisions and assessing business performance. See Note 9 for disclosures related to the Company's three operating and reporting segments. |