Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2017 | May 01, 2017 | |
Document And Entity Information [Abstract] | ||
Trading Symbol | WES | |
Entity Registrant Name | Western Gas Partners LP | |
Entity Central Index Key | 1,414,475 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2017 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q1 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Units Outstanding | 141,633,385 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | ||
Revenues and Other | |||
Total revenues and other | $ 516,193 | $ 383,141 | |
Equity income, net – affiliates | [1] | 19,461 | 16,814 |
Operating expenses | |||
Cost of product | [2] | 189,359 | 76,467 |
Operation and maintenance | [2] | 73,760 | 76,213 |
General and administrative | [2] | 12,659 | 11,277 |
Property and other taxes | 12,294 | 10,350 | |
Depreciation and amortization | 69,702 | 65,095 | |
Impairments | 164,742 | 6,518 | |
Total operating expenses | 522,516 | 245,920 | |
Gain (loss) on divestiture and other, net | 119,487 | (632) | |
Proceeds from business interruption insurance claims | 5,767 | 0 | |
Operating income (loss) | 138,392 | 153,403 | |
Interest income - affiliates | [3] | 4,225 | 4,225 |
Interest expense | [4] | (35,504) | (32,036) |
Other income (expense), net | 430 | 124 | |
Income (loss) before income taxes | 107,543 | 125,716 | |
Income tax (benefit) expense | 3,552 | 6,633 | |
Net income (loss) | 103,991 | 119,083 | |
Net income attributable to noncontrolling interest | 2,102 | 3,023 | |
Net income (loss) attributable to Western Gas Partners, LP | 101,889 | 116,060 | |
Limited partners' interest in net income (loss): | |||
Pre-acquisition net (income) loss allocated to Anadarko | 0 | (11,326) | |
General partner interest in net (income) loss | [5] | $ (68,162) | $ (55,400) |
Net income (loss) per common unit – basic and diluted | [6],[7] | $ 0.01 | $ 0.31 |
Series A Preferred Units [Member] | |||
Limited partners' interest in net income (loss): | |||
Limited partners’ interest in net income (loss) | [8] | $ (28,174) | $ (2,329) |
Common and Class C Units [Member] | |||
Limited partners' interest in net income (loss): | |||
Limited partners’ interest in net income (loss) | [5] | (5,553) | (47,005) |
Affiliates [Member] | |||
Revenues and Other | |||
Gathering, processing and transportation | 172,314 | 187,718 | |
Natural gas and natural gas liquids sales | 142,841 | 84,866 | |
Total revenues and other | [1] | 315,155 | 272,584 |
Operating expenses | |||
Cost of product | [1] | 15,988 | 24,580 |
Operation and maintenance | [9] | 17,089 | 17,975 |
General and administrative | [10] | 9,535 | 8,952 |
Total operating expenses | 42,612 | 51,507 | |
Interest expense | [11] | (71) | (4,537) |
Third Parties [Member] | |||
Revenues and Other | |||
Gathering, processing and transportation | 135,500 | 106,286 | |
Natural gas and natural gas liquids sales | 63,684 | 3,690 | |
Other | 1,854 | 581 | |
Total revenues and other | 201,038 | 110,557 | |
Operating expenses | |||
Interest expense | $ (35,433) | $ (27,499) | |
[1] | Represents amounts earned or incurred on and subsequent to the date of the acquisition of Partnership assets, as well as amounts earned or incurred by Anadarko on a historical basis related to the Partnership assets prior to the acquisition of such assets, recognized under gathering, treating or processing agreements, and purchase and sale agreements. | ||
[2] | Cost of product includes product purchases from Anadarko (as defined in Note 1) of $16.0 million and $24.6 million for the three months ended March 31, 2017 and 2016, respectively. Operation and maintenance includes charges from Anadarko of $17.1 million and $18.0 million for the three months ended March 31, 2017 and 2016, respectively. General and administrative includes charges from Anadarko of $9.5 million and $9.0 million for the three months ended March 31, 2017 and 2016, respectively. See Note 5. | ||
[3] | Represents interest income recognized on the note receivable from Anadarko. | ||
[4] | Includes affiliate (as defined in Note 1) amounts of $(0.1) million and $(4.5) million for the three months ended March 31, 2017 and 2016, respectively. See Note 2 and Note 9. | ||
[5] | Represents net income (loss) earned on and subsequent to the date of acquisition of the Partnership assets (as defined in Note 1). See Note 4. | ||
[6] | See Note 4 for the calculation of net income (loss) per common unit. | ||
[7] | The impact of Class C units and the conversion of Series A Preferred units would be anti-dilutive. | ||
[8] | Adjusted to reflect amortization of the beneficial conversion features. | ||
[9] | Represents expenses incurred on and subsequent to the date of the acquisition of Partnership assets, as well as expenses incurred by Anadarko on a historical basis related to the Partnership assets prior to the acquisition of such assets. | ||
[10] | Represents general and administrative expense incurred on and subsequent to the date of the Partnership’s acquisition of the Partnership assets, as well as a management services fee for reimbursement of expenses incurred by Anadarko for periods prior to the acquisition of the Partnership assets by the Partnership. These amounts include equity-based compensation expense allocated to the Partnership by Anadarko (see WES LTIP and WGP LTIP and Anadarko Incentive Plan within this Note 5). | ||
[11] | Includes amounts related to the Deferred purchase price obligation - Anadarko (see Note 2 and Note 9). |
Consolidated Statements of Ope3
Consolidated Statements of Operations (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | ||
Cost of product | [1] | $ 189,359 | $ 76,467 |
Operation and maintenance | [1] | 73,760 | 76,213 |
General and administrative | [1] | 12,659 | 11,277 |
Interest expense | [2] | (35,504) | (32,036) |
Affiliates [Member] | |||
Cost of product | [3] | 15,988 | 24,580 |
Operation and maintenance | [4] | 17,089 | 17,975 |
General and administrative | [5] | 9,535 | 8,952 |
Interest expense | [6] | $ (71) | $ (4,537) |
[1] | Cost of product includes product purchases from Anadarko (as defined in Note 1) of $16.0 million and $24.6 million for the three months ended March 31, 2017 and 2016, respectively. Operation and maintenance includes charges from Anadarko of $17.1 million and $18.0 million for the three months ended March 31, 2017 and 2016, respectively. General and administrative includes charges from Anadarko of $9.5 million and $9.0 million for the three months ended March 31, 2017 and 2016, respectively. See Note 5. | ||
[2] | Includes affiliate (as defined in Note 1) amounts of $(0.1) million and $(4.5) million for the three months ended March 31, 2017 and 2016, respectively. See Note 2 and Note 9. | ||
[3] | Represents amounts earned or incurred on and subsequent to the date of the acquisition of Partnership assets, as well as amounts earned or incurred by Anadarko on a historical basis related to the Partnership assets prior to the acquisition of such assets, recognized under gathering, treating or processing agreements, and purchase and sale agreements. | ||
[4] | Represents expenses incurred on and subsequent to the date of the acquisition of Partnership assets, as well as expenses incurred by Anadarko on a historical basis related to the Partnership assets prior to the acquisition of such assets. | ||
[5] | Represents general and administrative expense incurred on and subsequent to the date of the Partnership’s acquisition of the Partnership assets, as well as a management services fee for reimbursement of expenses incurred by Anadarko for periods prior to the acquisition of the Partnership assets by the Partnership. These amounts include equity-based compensation expense allocated to the Partnership by Anadarko (see WES LTIP and WGP LTIP and Anadarko Incentive Plan within this Note 5). | ||
[6] | Includes amounts related to the Deferred purchase price obligation - Anadarko (see Note 2 and Note 9). |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 | |
Current assets | |||
Cash and cash equivalents | $ 122,310 | $ 357,925 | |
Accounts receivable, net | [1] | 152,731 | 223,223 |
Other current assets | 10,578 | 12,866 | |
Total current assets | 285,619 | 594,014 | |
Note receivable - Anadarko | 260,000 | 260,000 | |
Property, plant and equipment | |||
Cost | 7,240,894 | 6,861,942 | |
Less accumulated depreciation | 1,974,081 | 1,812,010 | |
Net property, plant and equipment | 5,266,813 | 5,049,932 | |
Goodwill | 417,610 | 417,610 | |
Other intangible assets | 796,591 | 803,698 | |
Equity investments | 591,102 | 594,208 | |
Other assets | 15,105 | 13,566 | |
Total assets | 7,632,840 | 7,733,028 | |
Current liabilities | |||
Accounts and imbalance payables | 186,882 | 247,076 | |
Accrued ad valorem taxes | 35,185 | 23,121 | |
Accrued liabilities | [2] | 57,996 | 45,108 |
Total current liabilities | 280,063 | 315,305 | |
Long-term debt | 3,092,257 | 3,091,461 | |
Deferred income taxes | 9,529 | 6,402 | |
Asset retirement obligations and other | 145,342 | 142,641 | |
Deferred purchase price obligation - Anadarko | [3] | 37,346 | 41,440 |
Total long-term liabilities | 3,284,474 | 3,281,944 | |
Total liabilities | 3,564,537 | 3,597,249 | |
Equity and partners' capital | |||
General partner units (2,583,068 units issued and outstanding at March 31, 2017, and December 31, 2016) | 153,872 | 143,968 | |
Total partners' capital | 4,005,008 | 4,071,216 | |
Noncontrolling interest | 63,295 | 64,563 | |
Total equity and partners' capital | 4,068,303 | 4,135,779 | |
Total liabilities, equity and partners' capital | 7,632,840 | 7,733,028 | |
Series A Preferred Units [Member] | |||
Equity and partners' capital | |||
Series A Preferred units, Common units and Class C Units | [4] | 336,722 | 639,545 |
Common Units [Member] | |||
Equity and partners' capital | |||
Series A Preferred units, Common units and Class C Units | 2,759,744 | 2,536,872 | |
Class C Units [Member] | |||
Equity and partners' capital | |||
Series A Preferred units, Common units and Class C Units | [5] | $ 754,670 | $ 750,831 |
[1] | Accounts receivable, net includes amounts receivable from affiliates (as defined in Note 1) of $60.4 million and $76.6 million as of March 31, 2017, and December 31, 2016, respectively. Accounts receivable, net as of December 31, 2016, also includes an insurance claim receivable related to an incident at the DBM complex. See Note 1. | ||
[2] | Accrued liabilities includes affiliate amounts of $0.4 million and zero as of March 31, 2017, and December 31, 2016, respectively. | ||
[3] | See Note 2. | ||
[4] | The outstanding Series A Preferred units will convert into common units on a one-for-one basis in May 2017. See Note 4. | ||
[5] | The Class C units will convert into common units on a one-for-one basis on March 1, 2020, unless the Partnership elects to convert such units earlier or Anadarko extends the conversion date. See Note 4. |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 | |
General partner units issued | 2,583,068 | 2,583,068 | |
General partner units outstanding | 2,583,068 | 2,583,068 | |
Accounts receivable, net | [1] | $ 152,731 | $ 223,223 |
Accrued liabilities | [2] | 57,996 | 45,108 |
Affiliates [Member] | |||
Accounts receivable, net | 60,400 | 76,600 | |
Accrued liabilities | $ 400 | $ 0 | |
Series A Preferred Units [Member] | |||
Units issued | 10,961,416 | 21,922,831 | |
Units outstanding | 10,961,416 | 21,922,831 | |
Series A Preferred units, units issued upon conversion | 1 | ||
Common Units [Member] | |||
Units issued | 141,633,385 | 130,671,970 | |
Units outstanding | 141,633,385 | 130,671,970 | |
Class C Units [Member] | |||
Units issued | 12,537,100 | 12,358,123 | |
Units outstanding | 12,537,100 | 12,358,123 | |
Class C units, units issued upon conversion | 1 | ||
[1] | Accounts receivable, net includes amounts receivable from affiliates (as defined in Note 1) of $60.4 million and $76.6 million as of March 31, 2017, and December 31, 2016, respectively. Accounts receivable, net as of December 31, 2016, also includes an insurance claim receivable related to an incident at the DBM complex. See Note 1. | ||
[2] | Accrued liabilities includes affiliate amounts of $0.4 million and zero as of March 31, 2017, and December 31, 2016, respectively. |
Consolidated Statement of Equit
Consolidated Statement of Equity and Partners' Capital - 3 months ended Mar. 31, 2017 - USD ($) $ in Thousands | Total | Net Investment by Anadarko [Member] | Common Units [Member] | Class C Units [Member] | Series A Preferred Units [Member] | General Partner Units [Member] | Noncontrolling Interest [Member] | |
Balance at Dec. 31, 2016 | $ 4,135,779 | $ 0 | $ 2,536,872 | $ 750,831 | $ 639,545 | $ 143,968 | $ 64,563 | |
Net income (loss) | 103,991 | 0 | 24,428 | 1,846 | 7,453 | 68,162 | 2,102 | |
Above-market component of swap extensions with Anadarko | [1] | 12,297 | 12,297 | |||||
Conversion of Series A Preferred units into common units | [2] | 0 | 343,468 | (343,468) | ||||
Amortization of beneficial conversion feature of Class C units and Series A Preferred units | 0 | (50,093) | 1,993 | 48,100 | ||||
Distributions to noncontrolling interest owner | (3,370) | (3,370) | ||||||
Distributions to unitholders | (185,565) | (112,378) | (14,908) | (58,279) | ||||
Acquisitions from affiliates | 0 | 14 | (14) | |||||
Revision to Deferred purchase price obligation – Anadarko | [3] | 4,165 | 4,165 | |||||
Contributions of equity-based compensation from Anadarko | 1,119 | 1,098 | 21 | |||||
Net pre-acquisition contributions from (distributions to) Anadarko | (14) | (14) | ||||||
Other | (99) | (99) | ||||||
Balance at Mar. 31, 2017 | $ 4,068,303 | $ 0 | $ 2,759,744 | $ 754,670 | $ 336,722 | $ 153,872 | $ 63,295 | |
[1] | See Note 5. | |||||||
[2] | See Note 4. | |||||||
[3] | See Note 2. |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2017 | Mar. 31, 2016 | |||
Cash flows from operating activities | ||||
Net income (loss) | $ 103,991 | $ 119,083 | ||
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||||
Depreciation and amortization | 69,702 | 65,095 | ||
Impairments | 164,742 | 6,518 | ||
Non-cash equity-based compensation expense | 1,209 | 1,231 | ||
Deferred income taxes | 3,128 | 1,852 | ||
Accretion and amortization of long-term obligations, net | 1,101 | 5,467 | ||
Equity income, net – affiliates | [1] | (19,461) | (16,814) | |
Distributions from equity investment earnings – affiliates | 19,114 | 19,855 | ||
(Gain) loss on divestiture and other, net | (119,487) | 632 | ||
Lower of cost or market inventory adjustments | 45 | 0 | ||
Changes in assets and liabilities: | ||||
(Increase) decrease in accounts receivable, net | (1,513) | 12,558 | ||
Increase (decrease) in accounts and imbalance payables and accrued liabilities, net | (29,940) | 17,978 | ||
Change in other items, net | (15) | 3,048 | ||
Net cash provided by operating activities | 192,616 | 236,503 | ||
Cash flows from investing activities | ||||
Capital expenditures | (125,944) | (136,987) | ||
Investments in equity affiliates | 0 | 474 | ||
Distributions from equity investments in excess of cumulative earnings – affiliates | 3,453 | [2] | 4,784 | |
Proceeds from property insurance claims | 24,000 | 0 | ||
Net cash used in investing activities | (252,434) | (842,818) | ||
Cash flows from financing activities | ||||
Borrowings, net of debt issuance costs | (11) | 330,000 | ||
Increase (decrease) in outstanding checks | 1,024 | (994) | ||
Proceeds from the issuance of common units, net of offering expenses | (158) | 25,000 | ||
Distributions to unitholders | [3] | (185,565) | (152,588) | |
Distributions to noncontrolling interest owner | (3,370) | (3,838) | ||
Net contributions from (distributions to) Anadarko | (14) | (27,632) | ||
Above-market component of swap extensions with Anadarko | [3] | 12,297 | 6,813 | |
Net cash provided by (used in) financing activities | (175,797) | 616,761 | ||
Net increase (decrease) in cash and cash equivalents | (235,615) | 10,446 | ||
Cash and cash equivalents at beginning of period | 357,925 | 98,033 | ||
Cash and cash equivalents at end of period | 122,310 | 108,479 | ||
Supplemental disclosures | ||||
Net distributions to (contributions from) Anadarko of other assets | 0 | 714 | ||
Interest paid, net of capitalized interest | 28,656 | 18,223 | ||
Taxes paid (reimbursements received) | 189 | 67 | ||
Accrued capital expenditures | 85,280 | 68,152 | ||
Fair value of properties and equipment from non-cash third party transactions | [4] | 548,628 | 0 | |
Delaware Basin JV Gathering LLC [Member] | ||||
Supplemental disclosures | ||||
Accretion expense and revisions to the Deferred purchase price obligation – Anadarko | [4] | (4,094) | 4,537 | |
Series A Preferred Units [Member] | ||||
Cash flows from financing activities | ||||
Proceeds from the issuance of Series A Preferred units, net of offering expenses | 0 | 440,000 | ||
Affiliates [Member] | ||||
Cash flows from investing activities | ||||
Contributions in aid of construction costs from affiliates | 1,310 | 2,369 | ||
Acquisitions | 0 | (713,596) | ||
Cash flows from financing activities | ||||
Proceeds from the issuance of common units, net of offering expenses | [5] | 0 | 25,000 | |
Distributions to unitholders | [6] | (103,123) | (89,769) | |
Third Parties [Member] | ||||
Cash flows from investing activities | ||||
Acquisitions | (155,287) | 0 | ||
Proceeds from the sale of assets | $ 34 | $ 138 | ||
[1] | Represents amounts earned or incurred on and subsequent to the date of the acquisition of Partnership assets, as well as amounts earned or incurred by Anadarko on a historical basis related to the Partnership assets prior to the acquisition of such assets, recognized under gathering, treating or processing agreements, and purchase and sale agreements. | |||
[2] | Distributions in excess of cumulative earnings, classified as investing cash flows in the consolidated statements of cash flows, is calculated on an individual investment basis. | |||
[3] | See Note 5. | |||
[4] | See Note 2. | |||
[5] | Represents proceeds from the issuance of 835,841 common units to WGP as partial funding for the acquisition of Springfield (see Note 2). | |||
[6] | Represents distributions paid under the partnership agreement (see Note 3 and Note 4). |
Description of Business and Bas
Description of Business and Basis of Presentation | 3 Months Ended |
Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | General. Western Gas Partners, LP is a growth-oriented Delaware master limited partnership (“MLP”) formed by Anadarko Petroleum Corporation in 2007 to acquire, own, develop and operate midstream energy assets. For purposes of these consolidated financial statements, the “Partnership” refers to Western Gas Partners, LP and its subsidiaries. The Partnership’s general partner, Western Gas Holdings, LLC (the “general partner”), is owned by Western Gas Equity Partners, LP (“WGP”), a Delaware MLP formed by Anadarko Petroleum Corporation in September 2012 to own the Partnership’s general partner, as well as a significant limited partner interest in the Partnership. WGP has no independent operations or material assets other than owning the partnership interests in the Partnership (see Holdings of Partnership equity in Note 4 ). Western Gas Equity Holdings, LLC is WGP’s general partner and is a wholly owned subsidiary of Anadarko Petroleum Corporation. “Anadarko” refers to Anadarko Petroleum Corporation and its subsidiaries, excluding the Partnership and the general partner, and “affiliates” refers to subsidiaries of Anadarko, excluding the Partnership, but including equity interests in Fort Union Gas Gathering, LLC (“Fort Union”), White Cliffs Pipeline, LLC (“White Cliffs”), Rendezvous Gas Services, LLC (“Rendezvous”), Enterprise EF78 LLC (the “Mont Belvieu JV”), Texas Express Pipeline LLC (“TEP”), Texas Express Gathering LLC (“TEG”) and Front Range Pipeline LLC (“FRP”). The interests in TEP, TEG and FRP are referred to collectively as the “TEFR Interests.” “MGR assets” refers to the Red Desert complex and the Granger straddle plant. The Partnership is engaged in the business of gathering, compressing, treating, processing and transporting natural gas, and gathering, stabilizing and transporting condensate, natural gas liquids (“NGLs”) and crude oil. The Partnership is also currently constructing two produced-water disposal systems in West Texas, which are expected to be placed in service during the second quarter of 2017. The Partnership provides these midstream services for Anadarko, as well as for third-party producers and customers. As of March 31, 2017 , the Partnership’s assets and investments consisted of the following: Owned and Operated Operated Interests Non-Operated Interests Equity Interests Gathering systems 12 3 3 2 Treating facilities 21 3 — 3 Natural gas processing plants/trains 20 5 — 2 NGL pipelines 2 — — 3 Natural gas pipelines 5 — — — Oil pipelines — 1 — 1 These assets and investments are located in the Rocky Mountains (Colorado, Utah and Wyoming), North-central Pennsylvania and Texas. 1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION (CONTINUED) Basis of presentation. The following table outlines the Partnership’s ownership interests and the accounting method of consolidation used in the Partnership’s consolidated financial statements: Percentage Interest Equity investments (1) Fort Union 14.81 % White Cliffs 10 % Rendezvous 22 % Mont Belvieu JV 25 % TEP 20 % TEG 20 % FRP 33.33 % Proportionate consolidation (2) Marcellus Interest systems 33.75 % Newcastle system 50 % Springfield system 50.1 % Full consolidation Chipeta (3) 75 % DBJV system (4) 100 % (1) Investments in non-controlled entities over which the Partnership exercises significant influence are accounted for under the equity method. “Equity investment throughput” refers to the Partnership’s share of average throughput for these investments. (2) The Partnership proportionately consolidates its associated share of the assets, liabilities, revenues and expenses attributable to these assets. (3) The 25% interest in Chipeta Processing LLC (“Chipeta”) held by a third-party member is reflected within noncontrolling interest in the consolidated financial statements. (4) The Partnership acquired an additional 50% interest in the DBJV system (the “Additional DBJV System Interest”) from a third party on March 17, 2017. See Note 2 . The consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”). The consolidated financial statements include the accounts of the Partnership and entities in which it holds a controlling financial interest. All significant intercompany transactions have been eliminated. Certain information and note disclosures commonly included in annual financial statements have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, the accompanying consolidated financial statements and notes should be read in conjunction with the Partnership’s 2016 Form 10-K, as filed with the SEC on February 23, 2017. Management believes that the disclosures made are adequate to make the information not misleading. 1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION (CONTINUED) Presentation of Partnership assets. The term “Partnership assets” refers to the assets owned and interests accounted for under the equity method (see Note 7 ) by the Partnership as of March 31, 2017 . Because Anadarko controls the Partnership through its ownership and control of WGP, which owns the Partnership’s entire general partner interest, each acquisition of Partnership assets from Anadarko has been considered a transfer of net assets between entities under common control. As such, the Partnership assets acquired from Anadarko were initially recorded at Anadarko’s historic carrying value, which did not correlate to the total acquisition price paid by the Partnership. Further, after an acquisition of Partnership assets from Anadarko, the Partnership may be required to recast its financial statements to include the activities of such Partnership assets from the date of common control. For those periods requiring recast, the consolidated financial statements for periods prior to the Partnership’s acquisition of the Partnership assets from Anadarko are prepared from Anadarko’s historical cost-basis accounts and may not necessarily be indicative of the actual results of operations that would have occurred if the Partnership had owned the Partnership assets during the periods reported. Net income (loss) attributable to the Partnership assets acquired from Anadarko for periods prior to the Partnership’s acquisition of the Partnership assets is not allocated to the limited partners. Use of estimates. In preparing financial statements in accordance with GAAP, management makes informed judgments and estimates that affect the reported amounts of assets, liabilities, revenues and expenses. Management evaluates its estimates and related assumptions regularly, using historical experience and other methods considered reasonable. Changes in facts and circumstances or additional information may result in revised estimates and actual results may differ from these estimates. Effects on the business, financial condition and results of operations resulting from revisions to estimates are recognized when the facts that give rise to the revisions become known. The information furnished herein reflects all normal recurring adjustments which are, in the opinion of management, necessary for a fair presentation of the consolidated financial statements, and certain prior-period amounts have been reclassified to conform to the current-year presentation. Insurance recoveries. Involuntary conversions result from the loss of an asset because of some unforeseen event (e.g., destruction due to fire). Some of these events are insurable and result in property damage insurance recovery. Amounts that are received from insurance carriers are net of any deductibles related to the covered event. A receivable is recorded from insurance to the extent a loss is recognized from an involuntary conversion event and the likelihood of recovering such loss is deemed probable. To the extent that any insurance claim receivables are later judged not probable of recovery (e.g., due to new information), such amounts are expensed. A gain on involuntary conversion is recognized when the amount received from insurance exceeds the net book value of the retired asset(s). In addition, gains related to insurance recoveries are not recognized until all contingencies related to such proceeds have been resolved, that is, a cash payment is received from the insurance carrier or there is a binding settlement agreement with the carrier that clearly states that a payment will be made. To the extent that an asset is rebuilt, the associated expenditures are capitalized, as appropriate, in the consolidated balance sheets and presented as capital expenditures in the consolidated statements of cash flows. With respect to business interruption insurance claims, income is recognized only when cash proceeds are received from insurers, which are presented in the consolidated statements of operations as a component of Operating income (loss). On December 3, 2015, there was an initial fire and secondary explosion at the processing facility within the Delaware Basin Midstream, LLC (“DBM”) complex. The majority of the damage from the incident was to the liquid handling facilities and the amine treating units at the inlet of the complex. Train II (with capacity of 100 MMcf/d) sustained the most damage of the processing trains and returned to service in December 2016. Train III (with capacity of 200 MMcf/d) experienced minimal damage and returned to full service in May 2016. For the quarter ended March 31, 2017 , a $5.7 million loss was recorded in Gain (loss) on divestiture and other, net in the consolidated statements of operations, related to a change in the Partnership’s estimate of the amount that will be recovered under the property insurance claim based on further discussions with insurers. As of March 31, 2017 , and December 31, 2016 , the consolidated balance sheets include receivables of zero and $30.0 million , respectively, for a property insurance claim related to the incident at the DBM complex. For the quarter ended March 31, 2017 , the Partnership received $29.8 million in cash proceeds from insurers related to the incident at the DBM complex, including $5.8 million in proceeds from business interruption insurance claims and $24.0 million in proceeds from property insurance claims. 1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION (CONTINUED) Recently adopted accounting standards. Accounting Standards Update (“ASU”) 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business assists in determining whether a transaction should be accounted for as an acquisition or disposal of assets or as a business. This ASU provides a screen that when substantially all of the fair value of the gross assets acquired, or disposed of, are concentrated in a single identifiable asset, or a group of similar identifiable assets, the set will not be considered a business. If the screen is not met, a set must include an input and a substantive process that together significantly contribute to the ability to create an output to be considered a business. The Partnership’s adoption of this ASU on January 1, 2017, using a prospective approach, could have a material impact on future consolidated financial statements as goodwill will not be allocated to divestitures or recorded on acquisitions that are not considered to be a business. ASU 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory requires an entity to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs and eliminates the exception for an intra-entity transfer of an asset other than inventory. The Partnership adopted this ASU on January 1, 2017, using a modified retrospective approach, with no impact to its consolidated financial statements. New accounting standards issued but not yet adopted. ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash requires an entity to explain the changes in the total of cash, cash equivalents, restricted cash, and restricted cash equivalents on the statement of cash flows and to provide a reconciliation of the totals in that statement to the related captions in the balance sheet when the cash, cash equivalents, restricted cash, and restricted cash equivalents are presented in more than one line item on the balance sheet. This ASU is effective for annual and interim periods beginning after December 15, 2017, and is required to be adopted using a retrospective approach, with early adoption permitted. The Partnership is evaluating the impact of the adoption of this ASU on its consolidated financial statements. ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments provides clarification on how certain cash receipts and cash payments are presented and classified on the statement of cash flows. This ASU is effective for annual and interim periods beginning after December 15, 2017, and is required to be adopted using a retrospective approach if practicable, with early adoption permitted. The Partnership does not expect the adoption of this ASU to have a material impact on its consolidated statement of cash flows. ASU 2016-02, Leases (Topic 842) requires lessees to recognize a lease liability and a right-of-use asset for all leases, including operating leases, with a term greater than 12 months on the balance sheet. The provisions of ASU 2016-02 also modify the definition of a lease and outline the requirements for recognition, measurement, presentation and disclosure of leasing arrangements by both lessees and lessors. This ASU is effective for annual and interim periods beginning after December 15, 2018. The Partnership is currently analyzing its portfolio of contracts to assess the impact future adoption of this ASU may have on its consolidated financial statements. ASU 2014-09, Revenue from Contracts with Customers (Topic 606) supersedes current revenue recognition requirements and requires an entity to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration the entity expects to be entitled to in exchange for those goods or services. Additional disclosures will be required to describe the nature, amount, timing and uncertainty of revenue and cash flows from contracts with customers. The Partnership has completed an initial review of contracts in each of its revenue streams and is developing accounting policies to address the provisions of the ASU. The Partnership is currently analyzing whether total revenues and total expenses may increase as a result of recognizing both revenue for noncash consideration for services provided and revenue and associated cost of product for the subsequent sale of commodities received as such noncash consideration. The Partnership continues to evaluate the impact of this and other provisions of the ASU on accounting policies, internal controls and consolidated financial statements and related disclosures, and has not finalized any estimates of the potential impacts. The Partnership will adopt the new standard on January 1, 2018, using the modified retrospective method with a cumulative adjustment to equity and partners’ capital. |
Acquisitions and Divestitures
Acquisitions and Divestitures | 3 Months Ended |
Mar. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Acquisitions and Divestitures | 2. ACQUISITIONS AND DIVESTITURES The following table presents the acquisitions completed by the Partnership during 2017 and 2016 , and identifies the funding sources for such acquisitions: thousands except unit and percent amounts Acquisition Date Percentage Borrowings Cash On Hand Common Units Issued Series A Preferred Units Issued Springfield system (1) 03/14/2016 50.1 % $ 247,500 $ — 2,089,602 14,030,611 DBJV system (2) 03/17/2017 50 % — 155,000 — — (1) The Partnership acquired Springfield Pipeline LLC (“Springfield”) from Anadarko for $750.0 million , consisting of $712.5 million in cash and the issuance of 1,253,761 of the Partnership’s common units. Springfield owns a 50.1% interest in an oil gathering system and a gas gathering system, such interest being referred to in this report as the “Springfield interest.” The Springfield oil and gas gathering systems (collectively, the “Springfield system”) are located in Dimmit, La Salle, Maverick and Webb Counties in South Texas. The Partnership financed the cash portion of the acquisition through: (i) borrowings of $247.5 million on the Partnership’s senior unsecured revolving credit facility (“RCF”), (ii) the issuance of 835,841 of the Partnership’s common units to WGP and (iii) the issuance of Series A Preferred units to private investors. See Note 4 for further information regarding the Series A Preferred units. (2) The Partnership acquired the Additional DBJV System Interest from a third party. See Property exchange below. Property exchange. On March 17, 2017, the Partnership acquired the Additional DBJV System Interest from a third party in exchange for (a) the Partnership’s 33.75% non-operated interest in two natural gas gathering systems located in northern Pennsylvania (the “Non-Operated Marcellus Interest”), commonly referred to as the Liberty and Rome systems, and (b) $155.0 million of cash consideration (collectively, the “Property Exchange”). The Partnership previously held a 50% interest in, and operated, the DBJV system. The Property Exchange is reflected as a nonmonetary transaction whereby the acquired Additional DBJV System Interest is recorded at the fair value of the divested Non-Operated Marcellus Interest plus the $155.0 million of cash consideration. The Property Exchange resulted in a net gain of $125.4 million recorded as Gain (loss) on divestiture and other, net in the consolidated statements of operations. Results of operations attributable to the Property Exchange were included in the Partnership’s consolidated statement of operations beginning on the acquisition date in the first quarter of 2017. 2. ACQUISITIONS AND DIVESTITURES (CONTINUED) DBJV acquisition - Deferred purchase price obligation - Anadarko. The consideration to be paid by the Partnership for the March 2015 acquisition of Delaware Basin JV Gathering LLC (“DBJV”) from Anadarko, consists of a cash payment to Anadarko due on March 31, 2020. The cash payment will be equal to (a) eight multiplied by the average of the Partnership’s share in the Net Earnings (see definition below) of DBJV for the calendar years 2018 and 2019, less (b) the Partnership’s share of all capital expenditures incurred for DBJV between March 1, 2015, and February 29, 2020. Net Earnings is defined as all revenues less cost of product, operating expenses and property taxes, in each case attributable to DBJV on an accrual basis. During the three months ended March 31, 2017 , the Partnership recognized an aggregate $6.8 million decrease in the estimated future payment obligation (based on management’s estimate of the Partnership’s share of forecasted Net Earnings and capital expenditures for DBJV), resulting in a net present value of $37.3 million for this obligation at March 31, 2017 , calculated using a discounted cash flow model with a 10% discount rate. The reduction in the value of the deferred purchase price obligation is primarily due to revisions reflecting a decrease in the Partnership’s estimate of the average of 2018 and 2019 Net Earnings, partially offset by a decrease in the Partnership’s estimate of aggregate capital expenditures to be incurred by DBJV through February 29, 2020. The following table summarizes the financial statement impact of the Deferred purchase price obligation - Anadarko: Deferred purchase price obligation - Anadarko Estimated future payment obligation (1) Balance at December 31, 2016 $ 41,440 $ 56,455 Accretion expense (2) 71 Revision to Deferred purchase price obligation – Anadarko (3) (4,165 ) Balance at March 31, 2017 $ 37,346 $ 49,694 (1) Calculated using Level 3 inputs. (2) Accretion expense was recorded as a charge to Interest expense on the consolidated statements of operations. (3) Recorded as revisions within Common units on the consolidated balance sheet and consolidated statement of equity and partners’ capital. Hugoton system divestiture. During the fourth quarter of 2016, the Hugoton system, located in Southwest Kansas and Oklahoma, was sold to a third party, resulting in a net loss on sale of $12.0 million recorded as Gain (loss) on divestiture and other, net in the consolidated statements of operations. The Partnership allocated $1.6 million in goodwill to this divestiture. |
Partnership Distributions
Partnership Distributions | 3 Months Ended |
Mar. 31, 2017 | |
Distributions Made to Members or Limited Partners [Abstract] | |
Partnership Distributions | 3. PARTNERSHIP DISTRIBUTIONS The partnership agreement requires the Partnership to distribute all of its available cash (as defined in the partnership agreement) to unitholders of record on the applicable record date within 45 days of the end of each quarter. The Board of Directors of our general partner (the “Board of Directors”) declared the following cash distributions to the Partnership’s common and general partner unitholders for the periods presented: thousands except per-unit amounts Quarters Ended Total Quarterly Distribution per Unit Total Quarterly Cash Distribution Date of Distribution 2016 March 31 $ 0.815 $ 158,905 May 2016 June 30 0.830 162,827 August 2016 September 30 0.845 166,742 November 2016 December 31 0.860 170,657 February 2017 2017 March 31 (1) $ 0.875 $ 188,753 May 2017 (1) The Board of Directors declared a cash distribution to the Partnership’s unitholders for the first quarter of 2017 of $0.875 per unit, or $188.8 million in aggregate, including incentive distributions, but excluding distributions on Class C units (see Class C unit distributions below) and Series A Preferred units (see Series A Preferred unit distributions below). The cash distribution is payable on May 12, 2017 , to unitholders of record at the close of business on May 1, 2017 . Available cash. The amount of available cash (as defined in the partnership agreement) generally is all cash on hand at the end of the quarter, plus, at the discretion of the general partner, working capital borrowings made subsequent to the end of such quarter, less the amount of cash reserves established by the Partnership’s general partner to provide for the proper conduct of the Partnership’s business, including reserves to fund future capital expenditures; to comply with applicable laws, debt instruments or other agreements; or to provide funds for distributions to its unitholders, and to its general partner for any one or more of the next four quarters. Working capital borrowings generally include borrowings made under a credit facility or similar financing arrangement. Working capital borrowings may only be those that, at the time of such borrowings, were intended to be repaid within 12 months. In all cases, working capital borrowings are used solely for working capital purposes or to fund distributions to partners. Class C unit distributions. The Class C units receive quarterly distributions at a rate equivalent to the Partnership’s common units. The distributions are paid in the form of additional Class C units (“PIK Class C units”) until the scheduled conversion date on March 1, 2020 (unless earlier converted), and the Class C units are disregarded with respect to distributions of the Partnership’s available cash until they are converted to common units. The number of additional PIK Class C units to be issued in connection with a distribution payable on the Class C units is determined by dividing the corresponding distribution attributable to the Class C units by the volume-weighted-average price of the Partnership’s common units for the ten days immediately preceding the payment date for the common unit distribution, less a 6% discount. The Partnership records the PIK Class C unit distributions at fair value at the time of issuance. This Level 2 fair value measurement uses the Partnership’s unit price as a significant input in the determination of the fair value. See Note 4 for further discussion of the Class C units. 3. PARTNERSHIP DISTRIBUTIONS (CONTINUED) Series A Preferred unit distributions. As further described in Note 4 , the Partnership issued Series A Preferred units representing limited partner interests in the Partnership to private investors in 2016. The Series A Preferred unitholders receive quarterly distributions in cash equal to $0.68 per Series A Preferred unit, subject to certain adjustments. The following table summarizes the Series A Preferred unitholders’ cash distributions for the periods presented: thousands except per-unit amounts Quarters Ended Total Quarterly Distribution per Unit Total Quarterly Cash Distribution Date of Distribution 2016 March 31 (1) $ 0.68 $ 1,887 May 2016 June 30 (2) 0.68 14,082 August 2016 September 30 0.68 14,908 November 2016 December 31 0.68 14,908 February 2017 2017 March 31 (3) $ 0.68 $ 7,454 May 2017 (1) Quarterly per unit distribution prorated for the 18 -day period during which 14,030,611 Series A Preferred units were outstanding during the first quarter of 2016. (2) Full quarterly per unit distribution on 14,030,611 Series A Preferred units and quarterly per unit distribution prorated for the 77 -day period during which 7,892,220 Series A Preferred units were outstanding during the second quarter of 2016. (3) On March 1, 2017, 50% of the outstanding Series A Preferred units converted into common units on a one -for-one basis. Such converted common units were entitled only to distributions made to common unitholders with respect to the first quarter of 2017. See Note 4 . General partner interest and incentive distribution rights. As of March 31, 2017 , the general partner was entitled to 1.5% of all quarterly distributions that the Partnership makes prior to its liquidation and, as the holder of the incentive distribution rights (“IDRs”), was entitled to incentive distributions at the maximum distribution sharing percentage of 48.0% for all periods presented, after the minimum quarterly distribution and the target distribution levels had been achieved. The maximum distribution sharing percentage of 49.5% does not include any distributions that the general partner may receive on common units that it may acquire. |
Equity and Partners' Capital
Equity and Partners' Capital | 3 Months Ended |
Mar. 31, 2017 | |
Partners' Capital Notes [Abstract] | |
Equity and Partners' Capital | 4. EQUITY AND PARTNERS’ CAPITAL Class C units. In November 2014, the Partnership issued 10,913,853 Class C units to Anadarko Midstream Holdings, LLC (“AMH”), pursuant to a Unit Purchase Agreement with Anadarko and AMH. The Class C units were issued to partially fund the acquisition of DBM. When issued, the Class C units were scheduled to convert into common units on a one -for-one basis on December 31, 2017. In February 2017, Anadarko elected to extend the conversion date of the Class C units to March 1, 2020. The Partnership can elect to convert the Class C units earlier or Anadarko can extend the conversion date again. The Class C units were issued at a discount to the then-current market price of the common units into which they are convertible. This discount, totaling $34.8 million , represents a beneficial conversion feature, and at issuance, was reflected as an increase in common unitholders’ capital and a decrease in Class C unitholder capital to reflect the fair value of the Class C units at issuance. The beneficial conversion feature is considered a non-cash distribution that is recognized from the date of issuance through the date of conversion, resulting in an increase in Class C unitholder capital and a decrease in common unitholders’ capital as amortized. The beneficial conversion feature is amortized assuming the extended conversion date of March 1, 2020, using the effective yield method. The impact of the beneficial conversion feature amortization is also included in the calculation of earnings per unit. 4. EQUITY AND PARTNERS’ CAPITAL (CONTINUED) Series A Preferred units. In 2016, the Partnership issued 21,922,831 Series A Preferred units to private investors. Pursuant to an agreement between the Partnership and the holders of the Series A Preferred units, 50% of the Series A Preferred units converted into common units on a one -for-one basis on March 1, 2017, with the remaining Series A Preferred units to be converted in May 2017. The Partnership has an effective registration statement with the SEC relating to the public resale of the common units issued or to be issued upon conversion of the Series A Preferred units. The Series A Preferred units were issued at a discount to the then-current market price of the common units into which they are convertible. This discount, totaling $93.4 million , represents a beneficial conversion feature, and at issuance, was reflected as an increase in common unitholders’ capital and a decrease in Series A Preferred unitholders’ capital to reflect the fair value of the Series A Preferred units on the date of issuance. The beneficial conversion feature is considered a non-cash distribution that is recognized from the date of issuance through the date of conversion, resulting in an increase in Series A Preferred unitholders’ capital and a decrease in common unitholders’ capital as amortized. The beneficial conversion feature is amortized using the effective yield method. The impact of the beneficial conversion feature amortization is also included in the calculation of earnings per unit. Amortization for the beneficial conversion feature, including the accelerated amortization for the early conversion of 50% of the Series A Preferred units, was $48.1 million for the three months ended March 31, 2017, with the remaining balance of $14.2 million to be amortized through the conversion date for the remaining Series A Preferred units in May 2017. Partnership interests. The Partnership’s common units are listed on the New York Stock Exchange under the symbol “WES.” The following table summarizes the common, Class C, Series A Preferred and general partner units issued during the three months ended March 31, 2017 : Common Units Class C Units Series A Preferred Units General Partner Units Total Balance at December 31, 2016 130,671,970 12,358,123 21,922,831 2,583,068 167,535,992 PIK Class C units — 178,977 — — 178,977 Conversion of Series A Preferred units 10,961,415 — (10,961,415 ) — — Balance at March 31, 2017 141,633,385 12,537,100 10,961,416 2,583,068 167,714,969 Holdings of Partnership equity. As of March 31, 2017 , WGP held 50,132,046 common units, representing a 29.9% limited partner interest in the Partnership, and, through its ownership of the general partner, WGP indirectly held 2,583,068 general partner units, representing a 1.5% general partner interest in the Partnership, and 100% of the incentive distribution rights. As of March 31, 2017 , other subsidiaries of Anadarko collectively held 2,011,380 common units and 12,537,100 Class C units, representing an aggregate 8.7% limited partner interest in the Partnership. As of March 31, 2017 , the public held 89,489,959 common units, representing a 53.4% limited partner interest in the Partnership and private investors held 10,961,416 Series A Preferred units, representing a 6.5% limited partner interest in the Partnership. 4. EQUITY AND PARTNERS’ CAPITAL (CONTINUED) Net income (loss) per unit for common units. Net income (loss) attributable to the Partnership assets acquired from Anadarko for periods prior to the Partnership’s acquisition of the Partnership assets is not allocated to the unitholders for purposes of calculating net income (loss) per common unit. Net income (loss) attributable to Western Gas Partners, LP earned on and subsequent to the date of acquisition of the Partnership assets is allocated as follows: General partner. The general partner’s allocation is equal to cash distributions plus its portion of undistributed earnings or losses. Specifically, net income equal to the amount of available cash (as defined by the partnership agreement) is allocated to the general partner consistent with actual cash distributions and capital account allocations, including incentive distributions. Undistributed earnings (net income in excess of distributions) or undistributed losses (available cash in excess of net income) are then allocated to the general partner in accordance with its weighted-average ownership percentage during each period. Series A Preferred unitholders. The Series A Preferred units are not considered a participating security as they only have distribution rights up to the specified per-unit quarterly distribution and have no rights to the Partnership’s undistributed earnings and losses. As such, the Series A Preferred unitholders’ allocation is equal to their cash distribution plus the amortization of the Series A Preferred units beneficial conversion feature (see Series A Preferred units above). Common and Class C unitholders. The Class C units are considered a participating security because they participate in distributions with common units according to a predetermined formula (see Note 3 ). The Common and Class C unitholders’ allocation is equal to their cash distributions plus their respective portions of undistributed earnings or losses. Specifically, net income equal to the amount of available cash (as defined by the partnership agreement) is allocated to the common and Class C unitholders consistent with actual cash distributions and capital account allocations. Undistributed earnings or undistributed losses are then allocated to the common and Class C unitholders in accordance with their respective weighted-average ownership percentages during each period. The common unitholder allocation also includes the impact of the amortization of the Series A Preferred units and Class C units beneficial conversion features. The Class C unitholder allocation is similarly impacted by the amortization of the Class C units beneficial conversion feature (see Class C units above). Calculation of net income (loss) per unit. Basic net income (loss) per common unit is calculated by dividing the net income (loss) attributable to common unitholders by the weighted-average number of common units outstanding during the period. The common units issued in connection with acquisitions and equity offerings are included on a weighted-average basis for periods they were outstanding. Diluted net income (loss) per common unit is calculated by dividing the sum of (i) the net income (loss) attributable to common units adjusted for distributions on the Series A Preferred units and a reallocation of the common and Class C limited partners’ interest in net income (loss) assuming conversion of the Series A Preferred units into common units, and (ii) the net income (loss) attributable to the Class C units as a participating security, by the sum of the weighted-average number of common units outstanding plus the dilutive effect of (i) the weighted-average number of outstanding Class C units and (ii) the weighted-average number of common units outstanding assuming conversion of the Series A Preferred units. 4. EQUITY AND PARTNERS’ CAPITAL (CONTINUED) The following table illustrates the Partnership’s calculation of net income (loss) per unit for common units: Three Months Ended thousands except per-unit amounts 2017 2016 Net income (loss) attributable to Western Gas Partners, LP $ 101,889 $ 116,060 Pre-acquisition net (income) loss allocated to Anadarko — (11,326 ) Series A Preferred units interest in net (income) loss (1) (28,174 ) (2,329 ) General partner interest in net (income) loss (68,162 ) (55,400 ) Common and Class C limited partners’ interest in net income (loss) $ 5,553 $ 47,005 Net income (loss) allocable to common units (1) $ 1,714 $ 39,562 Net income (loss) allocable to Class C units (1) 3,839 7,443 Common and Class C limited partners’ interest in net income (loss) $ 5,553 $ 47,005 Net income (loss) per unit Common units – basic and diluted (2) $ 0.01 $ 0.31 Weighted-average units outstanding Common units – basic and diluted 134,448 128,990 Excluded due to anti-dilutive effect: Class C units (2) 12,452 11,590 Series A Preferred units assuming conversion to common units (2) 18,147 2,775 (1) Adjusted to reflect amortization of the beneficial conversion features. (2) The impact of Class C units and the conversion of Series A Preferred units would be anti-dilutive. |
Transactions with Affiliates
Transactions with Affiliates | 3 Months Ended |
Mar. 31, 2017 | |
Related Party Fees and Other Arrangements, Limited Liability Company (LLC) or Limited Partnership (LP) [Abstract] | |
Transactions with Affiliates | 5. TRANSACTIONS WITH AFFILIATES Affiliate transactions. Revenues from affiliates include amounts earned by the Partnership from services provided to Anadarko as well as from the sale of residue and NGLs to Anadarko. In addition, the Partnership purchases natural gas from an affiliate of Anadarko pursuant to gas purchase agreements. Operation and maintenance expense includes amounts accrued for or paid to affiliates for the operation of the Partnership assets, whether in providing services to affiliates or to third parties, including field labor, measurement and analysis, and other disbursements. A portion of the Partnership’s general and administrative expenses is paid by Anadarko, which results in affiliate transactions pursuant to the reimbursement provisions of the Partnership’s omnibus agreement. Affiliate expenses do not bear a direct relationship to affiliate revenues, and third-party expenses do not bear a direct relationship to third-party revenues. See Note 2 for further information related to contributions of assets to the Partnership by Anadarko. Cash management. Anadarko operates a cash management system whereby excess cash from most of its subsidiaries’ separate bank accounts is generally swept to centralized accounts. Prior to the Partnership’s acquisition of the Partnership assets, third-party sales and purchases related to such assets were received or paid in cash by Anadarko within its centralized cash management system. The outstanding affiliate balances were entirely settled through an adjustment to net investment by Anadarko in connection with the acquisition of the Partnership assets. Subsequent to the acquisition of Partnership assets from Anadarko, transactions related to such assets are cash-settled directly with third parties and with Anadarko affiliates. Chipeta cash settles its transactions directly with third parties and Anadarko, as well as with the other subsidiaries of the Partnership. Note receivable - Anadarko and Deferred purchase price obligation - Anadarko. Concurrently with the closing of the Partnership’s May 2008 initial public offering, the Partnership loaned $260.0 million to Anadarko in exchange for a 30-year note bearing interest at a fixed annual rate of 6.50% , payable quarterly. The fair value of the note receivable from Anadarko was $311.0 million and $313.3 million at March 31, 2017 , and December 31, 2016 , respectively. The fair value of the note reflects consideration of credit risk and any premium or discount for the differential between the stated interest rate and quarter-end market interest rate, based on quoted market prices of similar debt instruments. Accordingly, the fair value of the note receivable from Anadarko is measured using Level 2 inputs. The consideration to be paid by the Partnership to Anadarko for the March 2015 acquisition of DBJV consists of a cash payment due on March 31, 2020. See Note 2 and Note 9 . Commodity price swap agreements. The Partnership has commodity price swap agreements with Anadarko to mitigate exposure to a majority of the commodity price risk inherent in its percent-of-proceeds and keep-whole contracts. Notional volumes for each of the commodity price swap agreements are not specifically defined. Instead, the commodity price swap agreements apply to the actual volume of natural gas, condensate and NGLs purchased and sold. The commodity price swap agreements do not satisfy the definition of a derivative financial instrument and, therefore, are not required to be measured at fair value. 5. TRANSACTIONS WITH AFFILIATES (CONTINUED) The following table summarizes gains and losses upon settlement of commodity price swap agreements recognized in the consolidated statements of operations: Three Months Ended thousands 2017 2016 Gains (losses) on commodity price swap agreements related to sales: (1) Natural gas sales $ 1,082 $ 7,041 Natural gas liquids sales (4,307 ) 20,070 Total (3,225 ) 27,111 Gains (losses) on commodity price swap agreements related to purchases (2) 2,696 (18,871 ) Net gains (losses) on commodity price swap agreements $ (529 ) $ 8,240 (1) Reported in affiliate Natural gas and natural gas liquids sales in the consolidated statements of operations in the period in which the related sale is recorded. (2) Reported in Cost of product in the consolidated statements of operations in the period in which the related purchase is recorded. Revenues or costs attributable to volumes settled during 2016 and 2017 for the DJ Basin complex and 2017 for the MGR assets are recognized in the consolidated statements of operations at the applicable market price in the tables below. The Partnership also records a capital contribution from Anadarko in the Partnership’s consolidated statement of equity and partners’ capital for the amount by which the swap price exceeds the applicable market price in the tables below. The commodity price swap agreement for the Hugoton system was in place until its divestiture in October 2016. For the three months ended March 31, 2017 , the capital contribution from Anadarko was $12.3 million . The tables below summarize the swap prices compared to the forward market prices: DJ Basin Complex per barrel except natural gas 2016 - 2017 Swap Prices 2016 Market Prices (1) 2017 Market Prices (1) Ethane $ 18.41 $ 0.60 $ 5.09 Propane 47.08 10.98 18.85 Isobutane 62.09 17.23 26.83 Normal butane 54.62 16.86 26.20 Natural gasoline 72.88 26.15 41.84 Condensate 76.47 34.65 45.40 Natural gas (per MMBtu) 5.96 2.11 3.05 (1) Represents the New York Mercantile Exchange (“NYMEX”) forward strip price as of December 8, 2015 and December 1, 2016, for the 2016 Market Prices and 2017 Market Prices, respectively, adjusted for product specification, location, basis and, in the case of NGLs, transportation and fractionation costs. 5. TRANSACTIONS WITH AFFILIATES (CONTINUED) MGR Assets per barrel except natural gas 2016 - 2017 Swap Prices 2017 Market Prices (1) Ethane $ 23.11 $ 4.08 Propane 52.90 19.24 Isobutane 73.89 25.79 Normal butane 64.93 25.16 Natural gasoline 81.68 45.01 Condensate 81.68 53.55 Natural gas (per MMBtu) 4.87 3.05 (1) Represents the NYMEX forward strip price as of December 1, 2016, adjusted for product specification, location, basis and, in the case of NGLs, transportation and fractionation costs. Gathering and processing agreements. The Partnership has significant gathering and processing arrangements with affiliates of Anadarko on a majority of its systems. The Partnership’s natural gas gathering, treating and transportation throughput (excluding equity investment throughput) attributable to production owned or controlled by Anadarko was 32% and 37% for the three months ended March 31, 2017 and 2016 , respectively. The Partnership’s natural gas processing throughput (excluding equity investment throughput) attributable to production owned or controlled by Anadarko was 49% and 61% for the three months ended March 31, 2017 and 2016 , respectively. The Partnership’s crude/NGL gathering, treating and transportation throughput (excluding equity investment throughput) attributable to production owned or controlled by Anadarko was 56% and 64% for the three months ended March 31, 2017 and 2016 , respectively. Commodity purchase and sale agreements. The Partnership sells a significant amount of its natural gas, condensate and NGLs to Anadarko Energy Services Company (“AESC”), Anadarko’s marketing affiliate. In addition, the Partnership purchases natural gas, condensate and NGLs from AESC pursuant to purchase agreements. The Partnership’s purchase and sale agreements with AESC are generally one-year contracts, subject to annual renewal. Acquisitions from Anadarko. On March 14, 2016, the Partnership acquired Springfield from Anadarko (see Note 2 ). 5. TRANSACTIONS WITH AFFILIATES (CONTINUED) WES LTIP. The general partner awards phantom units under the Western Gas Partners, LP 2008 Long-Term Incentive Plan (“WES LTIP”) primarily to its independent directors, but also from time to time to its executive officers and Anadarko employees performing services for the Partnership. The phantom units awarded to the independent directors vest one year from the grant date, while all other awards are subject to graded vesting over a three -year service period. Compensation expense is recognized over the vesting period and was $0.1 million for each of the three months ended March 31, 2017 and 2016 . WGP LTIP and Anadarko Incentive Plan. For each of the three months ended March 31, 2017 and 2016 , general and administrative expenses included $1.2 million of equity-based compensation expense, allocated to the Partnership by Anadarko, for awards granted to the executive officers of the general partner and other employees under the Western Gas Equity Partners, LP 2012 Long-Term Incentive Plan (“WGP LTIP”) and the Anadarko Petroleum Corporation 2012 Omnibus Incentive Compensation Plan (“Anadarko Incentive Plan”). Of this amount, $1.1 million is reflected as contributions to partners’ capital in the Partnership’s consolidated statement of equity and partners’ capital for the three months ended March 31, 2017 . Equipment purchases. The following table summarizes the Partnership’s purchases from Anadarko of pipe and equipment: Three Months Ended March 31, 2017 2016 thousands Purchases Cash consideration $ — $ 1,096 Payable to affiliate — 990 Net carrying value — (1,372 ) Partners’ capital adjustment $ — $ 714 Contributions in aid of construction costs from affiliates. On certain of the Partnership’s capital projects, Anadarko is obligated to reimburse the Partnership for all or a portion of project capital expenditures. The majority of such arrangements are associated with projects related to pipeline construction activities and production well tie-ins. The cash receipts resulting from such reimbursements are presented as “Contributions in aid of construction costs from affiliates” within the investing section of the Partnership’s consolidated statements of cash flows. 5. TRANSACTIONS WITH AFFILIATES (CONTINUED) Summary of affiliate transactions. The following table summarizes material affiliate transactions. See Note 2 for discussion of affiliate acquisitions and related funding. Three Months Ended thousands 2017 2016 Revenues and other (1) $ 315,155 $ 272,584 Equity income, net – affiliates (1) 19,461 16,814 Cost of product (1) 15,988 24,580 Operation and maintenance (2) 17,089 17,975 General and administrative (3) 9,535 8,952 Operating expenses 42,612 51,507 Interest income (4) 4,225 4,225 Interest expense (5) 71 4,537 Proceeds from the issuance of common units, net of offering expenses (6) — 25,000 Distributions to unitholders (7) 103,123 89,769 Above-market component of swap extensions with Anadarko 12,297 6,813 (1) Represents amounts earned or incurred on and subsequent to the date of the acquisition of Partnership assets, as well as amounts earned or incurred by Anadarko on a historical basis related to the Partnership assets prior to the acquisition of such assets, recognized under gathering, treating or processing agreements, and purchase and sale agreements. (2) Represents expenses incurred on and subsequent to the date of the acquisition of Partnership assets, as well as expenses incurred by Anadarko on a historical basis related to the Partnership assets prior to the acquisition of such assets. (3) Represents general and administrative expense incurred on and subsequent to the date of the Partnership’s acquisition of the Partnership assets, as well as a management services fee for reimbursement of expenses incurred by Anadarko for periods prior to the acquisition of the Partnership assets by the Partnership. These amounts include equity-based compensation expense allocated to the Partnership by Anadarko (see WES LTIP and WGP LTIP and Anadarko Incentive Plan within this Note 5 ). (4) Represents interest income recognized on the note receivable from Anadarko. (5) Includes amounts related to the Deferred purchase price obligation - Anadarko (see Note 2 and Note 9 ). (6) Represents proceeds from the issuance of 835,841 common units to WGP as partial funding for the acquisition of Springfield (see Note 2 ). (7) Represents distributions paid under the partnership agreement (see Note 3 and Note 4 ). Concentration of credit risk. Anadarko was the only customer from whom revenues exceeded 10% of the Partnership’s consolidated revenues for all periods presented in the consolidated statements of operations. |
Property, Plant and Equipment
Property, Plant and Equipment | 3 Months Ended |
Mar. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | 6. PROPERTY, PLANT AND EQUIPMENT A summary of the historical cost of the Partnership’s property, plant and equipment is as follows: thousands Estimated Useful Life March 31, 2017 December 31, 2016 Land n/a $ 4,021 $ 4,012 Gathering systems and processing complexes 3 to 47 years 6,836,748 6,462,053 Pipelines and equipment 15 to 45 years 139,376 139,646 Assets under construction n/a 230,898 226,626 Other 3 to 40 years 29,851 29,605 Total property, plant and equipment 7,240,894 6,861,942 Accumulated depreciation 1,974,081 1,812,010 Net property, plant and equipment $ 5,266,813 $ 5,049,932 The cost of property classified as “Assets under construction” is excluded from capitalized costs being depreciated. These amounts represent property that is not yet suitable to be placed into productive service as of the respective balance sheet date. Impairments. As of March 31, 2017 , net property, plant and equipment includes impairments of $164.7 million , including an impairment of $158.8 million at the Granger complex, which was impaired to its estimated fair value of $48.5 million using the income approach and Level 3 fair value inputs, due to a reduced throughput fee as a result of a producer’s bankruptcy. Also during the period, the Partnership recognized additional impairments of $5.9 million , primarily related to (i) a $3.7 million impairment at the Granger straddle plant, which was impaired to its estimated salvage value of $0.6 million using the income approach and Level 3 fair value inputs and (ii) the cancellation of a pipeline project in West Texas. During 2016, the Partnership recognized impairments of $15.5 million , including an impairment of $6.1 million at the Newcastle system, which was impaired to its estimated fair value of $3.1 million using the income approach and Level 3 fair value inputs, due to a reduction in estimated future cash flows caused by the low commodity price environment. Also during 2016, the Partnership recognized impairments of $9.4 million , primarily related to the cancellation of projects at the DJ Basin complex and Springfield and DBJV systems, and the abandonment of compressors at the MIGC system. |
Equity Investments
Equity Investments | 3 Months Ended |
Mar. 31, 2017 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity Investments | 7. EQUITY INVESTMENTS The following table presents the activity in the Partnership’s equity investments for the three months ended March 31, 2017 : Equity Investments thousands Fort White Rendezvous Mont TEG TEP FRP Total Balance at December 31, 2016 $ 12,833 $ 47,319 $ 46,739 $ 112,805 $ 15,846 $ 189,194 $ 169,472 $ 594,208 Investment earnings (loss), net of amortization 805 3,098 249 6,863 367 4,276 3,803 19,461 Distributions (845 ) (2,952 ) (734 ) (6,125 ) (272 ) (4,339 ) (3,847 ) (19,114 ) Distributions in excess of cumulative earnings (1) — (615 ) (809 ) — — (851 ) (1,178 ) (3,453 ) Balance at March 31, 2017 $ 12,793 $ 46,850 $ 45,445 $ 113,543 $ 15,941 $ 188,280 $ 168,250 $ 591,102 (1) Distributions in excess of cumulative earnings, classified as investing cash flows in the consolidated statements of cash flows, is calculated on an individual investment basis. |
Components of Working Capital
Components of Working Capital | 3 Months Ended |
Mar. 31, 2017 | |
Components Of Working Capital [Abstract] | |
Components of Working Capital | 8. COMPONENTS OF WORKING CAPITAL A summary of accounts receivable, net is as follows: thousands March 31, 2017 December 31, 2016 Trade receivables, net $ 152,654 $ 192,808 Other receivables, net 77 30,415 Total accounts receivable, net $ 152,731 $ 223,223 A summary of other current assets is as follows: thousands March 31, 2017 December 31, 2016 Natural gas liquids inventory $ 8,348 $ 7,126 Imbalance receivables 977 3,483 Prepaid insurance 1,253 2,257 Total other current assets $ 10,578 $ 12,866 A summary of accrued liabilities is as follows: thousands March 31, 2017 December 31, 2016 Accrued interest expense $ 45,574 $ 39,826 Short-term asset retirement obligations 6,678 3,114 Short-term remediation and reclamation obligations 630 630 Income taxes payable 1,430 1,006 Other 3,684 532 Total accrued liabilities $ 57,996 $ 45,108 |
Debt and Interest Expense
Debt and Interest Expense | 3 Months Ended |
Mar. 31, 2017 | |
Debt Instruments [Abstract] | |
Debt and Interest Expense | 9. DEBT AND INTEREST EXPENSE At March 31, 2017 , the Partnership’s debt consisted of 5.375% Senior Notes due 2021 (the “2021 Notes”), 4.000% Senior Notes due 2022 (the “2022 Notes”), 2.600% Senior Notes due 2018 (the “2018 Notes”), 5.450% Senior Notes due 2044 (the “2044 Notes”), 3.950% Senior Notes due 2025 (the “2025 Notes”), and 4.650% Senior Notes due 2026 (the “2026 Notes”). The following table presents the Partnership’s outstanding debt as of March 31, 2017 , and December 31, 2016 : March 31, 2017 December 31, 2016 thousands Principal Carrying Value Fair Value (1) Principal Carrying Value Fair Value (1) 2021 Notes $ 500,000 $ 494,999 $ 537,815 $ 500,000 $ 494,734 $ 536,252 2022 Notes 670,000 668,688 688,423 670,000 668,634 681,723 2018 Notes 350,000 349,311 351,970 350,000 349,188 351,531 2044 Notes 600,000 593,152 614,253 600,000 593,132 615,753 2025 Notes 500,000 491,196 494,066 500,000 490,971 492,499 2026 Notes 500,000 494,911 514,065 500,000 494,802 518,441 Total long-term debt $ 3,120,000 $ 3,092,257 $ 3,200,592 $ 3,120,000 $ 3,091,461 $ 3,196,199 (1) Fair value is measured using the market approach and Level 2 inputs. Debt activity. The following table presents the debt activity of the Partnership for the three months ended March 31, 2017 : thousands Carrying Value Balance at December 31, 2016 $ 3,091,461 Other 796 Balance at March 31, 2017 $ 3,092,257 Senior Notes. At March 31, 2017 , the Partnership was in compliance with all covenants under the indentures governing its outstanding notes. Revolving credit facility. As of March 31, 2017 , the Partnership had no outstanding RCF borrowings and $4.9 million in outstanding letters of credit, resulting in $1.195 billion available for borrowing under the RCF, which matures in February 2020. As of March 31, 2017 and 2016 , the interest rate on the outstanding RCF borrowings was 2.28% and 1.74% , respectively. The facility fee rate was 0.20% at March 31, 2017 and 2016 . At March 31, 2017 , the Partnership was in compliance with all covenants under the RCF. 9. DEBT AND INTEREST EXPENSE (CONTINUED) Interest expense. The following table summarizes the amounts included in interest expense: Three Months Ended thousands 2017 2016 Third parties Long-term debt $ (34,619 ) $ (27,818 ) Amortization of debt issuance costs and commitment fees (1,630 ) (1,530 ) Capitalized interest 816 1,849 Total interest expense – third parties (35,433 ) (27,499 ) Affiliates Deferred purchase price obligation – Anadarko (1) (71 ) (4,537 ) Total interest expense – affiliates (71 ) (4,537 ) Interest expense $ (35,504 ) $ (32,036 ) (1) See Note 2 for a discussion of the Deferred purchase price obligation - Anadarko. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 10. COMMITMENTS AND CONTINGENCIES Litigation and legal proceedings. From time to time, the Partnership is involved in legal, tax, regulatory and other proceedings in various forums regarding performance, contracts and other matters that arise in the ordinary course of business. Management is not aware of any such proceeding the final disposition of which could have a material adverse effect on the Partnership’s financial condition, results of operations or cash flows. Other commitments. The Partnership has short-term payment obligations, or commitments, related to its capital spending programs, as well as those of its unconsolidated affiliates. As of March 31, 2017 , the Partnership had unconditional payment obligations for services to be rendered or products to be delivered in connection with its capital projects of $36.9 million , the majority of which is expected to be paid in the next twelve months. These commitments relate primarily to (i) the construction of Train VI at the DBM complex, (ii) expansion projects at the DBJV system and the DBM and DJ Basin complexes and (iii) the construction of two produced-water disposal systems in West Texas. Lease commitments. Anadarko, on behalf of the Partnership, has entered into lease agreements for corporate offices, shared field offices and a warehouse supporting the Partnership’s operations, for which Anadarko charges the Partnership rent. The leases for the corporate offices and shared field offices extend through 2017 and 2019, respectively, and the lease for the warehouse expired in February 2017. Rent expense associated with the office, warehouse and equipment leases was $7.9 million and $8.9 million for the three months ended March 31, 2017 and 2016 , respectively. |
Description of Business and B18
Description of Business and Basis of Presentation (Policies) | 3 Months Ended |
Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
Consolidation policy | Basis of presentation. The following table outlines the Partnership’s ownership interests and the accounting method of consolidation used in the Partnership’s consolidated financial statements: Percentage Interest Equity investments (1) Fort Union 14.81 % White Cliffs 10 % Rendezvous 22 % Mont Belvieu JV 25 % TEP 20 % TEG 20 % FRP 33.33 % Proportionate consolidation (2) Marcellus Interest systems 33.75 % Newcastle system 50 % Springfield system 50.1 % Full consolidation Chipeta (3) 75 % DBJV system (4) 100 % (1) Investments in non-controlled entities over which the Partnership exercises significant influence are accounted for under the equity method. “Equity investment throughput” refers to the Partnership’s share of average throughput for these investments. (2) The Partnership proportionately consolidates its associated share of the assets, liabilities, revenues and expenses attributable to these assets. (3) The 25% interest in Chipeta Processing LLC (“Chipeta”) held by a third-party member is reflected within noncontrolling interest in the consolidated financial statements. (4) The Partnership acquired an additional 50% interest in the DBJV system (the “Additional DBJV System Interest”) from a third party on March 17, 2017. See Note 2 . The consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”). The consolidated financial statements include the accounts of the Partnership and entities in which it holds a controlling financial interest. All significant intercompany transactions have been eliminated. Certain information and note disclosures commonly included in annual financial statements have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, the accompanying consolidated financial statements and notes should be read in conjunction with the Partnership’s 2016 Form 10-K, as filed with the SEC on February 23, 2017. Management believes that the disclosures made are adequate to make the information not misleading. |
Business combinations policy | Presentation of Partnership assets. The term “Partnership assets” refers to the assets owned and interests accounted for under the equity method (see Note 7 ) by the Partnership as of March 31, 2017 . Because Anadarko controls the Partnership through its ownership and control of WGP, which owns the Partnership’s entire general partner interest, each acquisition of Partnership assets from Anadarko has been considered a transfer of net assets between entities under common control. As such, the Partnership assets acquired from Anadarko were initially recorded at Anadarko’s historic carrying value, which did not correlate to the total acquisition price paid by the Partnership. Further, after an acquisition of Partnership assets from Anadarko, the Partnership may be required to recast its financial statements to include the activities of such Partnership assets from the date of common control. For those periods requiring recast, the consolidated financial statements for periods prior to the Partnership’s acquisition of the Partnership assets from Anadarko are prepared from Anadarko’s historical cost-basis accounts and may not necessarily be indicative of the actual results of operations that would have occurred if the Partnership had owned the Partnership assets during the periods reported. Net income (loss) attributable to the Partnership assets acquired from Anadarko for periods prior to the Partnership’s acquisition of the Partnership assets is not allocated to the limited partners. |
Use of estimates policy | Use of estimates. In preparing financial statements in accordance with GAAP, management makes informed judgments and estimates that affect the reported amounts of assets, liabilities, revenues and expenses. Management evaluates its estimates and related assumptions regularly, using historical experience and other methods considered reasonable. Changes in facts and circumstances or additional information may result in revised estimates and actual results may differ from these estimates. Effects on the business, financial condition and results of operations resulting from revisions to estimates are recognized when the facts that give rise to the revisions become known. The information furnished herein reflects all normal recurring adjustments which are, in the opinion of management, necessary for a fair presentation of the consolidated financial statements, and certain prior-period amounts have been reclassified to conform to the current-year presentation. |
Property, plant and equipment policy | Insurance recoveries. Involuntary conversions result from the loss of an asset because of some unforeseen event (e.g., destruction due to fire). Some of these events are insurable and result in property damage insurance recovery. Amounts that are received from insurance carriers are net of any deductibles related to the covered event. A receivable is recorded from insurance to the extent a loss is recognized from an involuntary conversion event and the likelihood of recovering such loss is deemed probable. To the extent that any insurance claim receivables are later judged not probable of recovery (e.g., due to new information), such amounts are expensed. A gain on involuntary conversion is recognized when the amount received from insurance exceeds the net book value of the retired asset(s). In addition, gains related to insurance recoveries are not recognized until all contingencies related to such proceeds have been resolved, that is, a cash payment is received from the insurance carrier or there is a binding settlement agreement with the carrier that clearly states that a payment will be made. To the extent that an asset is rebuilt, the associated expenditures are capitalized, as appropriate, in the consolidated balance sheets and presented as capital expenditures in the consolidated statements of cash flows. With respect to business interruption insurance claims, income is recognized only when cash proceeds are received from insurers, which are presented in the consolidated statements of operations as a component of Operating income (loss). On December 3, 2015, there was an initial fire and secondary explosion at the processing facility within the Delaware Basin Midstream, LLC (“DBM”) complex. The majority of the damage from the incident was to the liquid handling facilities and the amine treating units at the inlet of the complex. Train II (with capacity of 100 MMcf/d) sustained the most damage of the processing trains and returned to service in December 2016. Train III (with capacity of 200 MMcf/d) experienced minimal damage and returned to full service in May 2016. For the quarter ended March 31, 2017 , a $5.7 million loss was recorded in Gain (loss) on divestiture and other, net in the consolidated statements of operations, related to a change in the Partnership’s estimate of the amount that will be recovered under the property insurance claim based on further discussions with insurers. As of March 31, 2017 , and December 31, 2016 , the consolidated balance sheets include receivables of zero and $30.0 million , respectively, for a property insurance claim related to the incident at the DBM complex. For the quarter ended March 31, 2017 , the Partnership received $29.8 million in cash proceeds from insurers related to the incident at the DBM complex, including $5.8 million in proceeds from business interruption insurance claims and $24.0 million in proceeds from property insurance claims. |
New issued accounting standards policy | Recently adopted accounting standards. Accounting Standards Update (“ASU”) 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business assists in determining whether a transaction should be accounted for as an acquisition or disposal of assets or as a business. This ASU provides a screen that when substantially all of the fair value of the gross assets acquired, or disposed of, are concentrated in a single identifiable asset, or a group of similar identifiable assets, the set will not be considered a business. If the screen is not met, a set must include an input and a substantive process that together significantly contribute to the ability to create an output to be considered a business. The Partnership’s adoption of this ASU on January 1, 2017, using a prospective approach, could have a material impact on future consolidated financial statements as goodwill will not be allocated to divestitures or recorded on acquisitions that are not considered to be a business. ASU 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory requires an entity to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs and eliminates the exception for an intra-entity transfer of an asset other than inventory. The Partnership adopted this ASU on January 1, 2017, using a modified retrospective approach, with no impact to its consolidated financial statements. New accounting standards issued but not yet adopted. ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash requires an entity to explain the changes in the total of cash, cash equivalents, restricted cash, and restricted cash equivalents on the statement of cash flows and to provide a reconciliation of the totals in that statement to the related captions in the balance sheet when the cash, cash equivalents, restricted cash, and restricted cash equivalents are presented in more than one line item on the balance sheet. This ASU is effective for annual and interim periods beginning after December 15, 2017, and is required to be adopted using a retrospective approach, with early adoption permitted. The Partnership is evaluating the impact of the adoption of this ASU on its consolidated financial statements. ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments provides clarification on how certain cash receipts and cash payments are presented and classified on the statement of cash flows. This ASU is effective for annual and interim periods beginning after December 15, 2017, and is required to be adopted using a retrospective approach if practicable, with early adoption permitted. The Partnership does not expect the adoption of this ASU to have a material impact on its consolidated statement of cash flows. ASU 2016-02, Leases (Topic 842) requires lessees to recognize a lease liability and a right-of-use asset for all leases, including operating leases, with a term greater than 12 months on the balance sheet. The provisions of ASU 2016-02 also modify the definition of a lease and outline the requirements for recognition, measurement, presentation and disclosure of leasing arrangements by both lessees and lessors. This ASU is effective for annual and interim periods beginning after December 15, 2018. The Partnership is currently analyzing its portfolio of contracts to assess the impact future adoption of this ASU may have on its consolidated financial statements. ASU 2014-09, Revenue from Contracts with Customers (Topic 606) supersedes current revenue recognition requirements and requires an entity to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration the entity expects to be entitled to in exchange for those goods or services. Additional disclosures will be required to describe the nature, amount, timing and uncertainty of revenue and cash flows from contracts with customers. The Partnership has completed an initial review of contracts in each of its revenue streams and is developing accounting policies to address the provisions of the ASU. The Partnership is currently analyzing whether total revenues and total expenses may increase as a result of recognizing both revenue for noncash consideration for services provided and revenue and associated cost of product for the subsequent sale of commodities received as such noncash consideration. The Partnership continues to evaluate the impact of this and other provisions of the ASU on accounting policies, internal controls and consolidated financial statements and related disclosures, and has not finalized any estimates of the potential impacts. The Partnership will adopt the new standard on January 1, 2018, using the modified retrospective method with a cumulative adjustment to equity and partners’ capital. |
Net income (loss) per common unit policy | Net income (loss) per unit for common units. Net income (loss) attributable to the Partnership assets acquired from Anadarko for periods prior to the Partnership’s acquisition of the Partnership assets is not allocated to the unitholders for purposes of calculating net income (loss) per common unit. Net income (loss) attributable to Western Gas Partners, LP earned on and subsequent to the date of acquisition of the Partnership assets is allocated as follows: General partner. The general partner’s allocation is equal to cash distributions plus its portion of undistributed earnings or losses. Specifically, net income equal to the amount of available cash (as defined by the partnership agreement) is allocated to the general partner consistent with actual cash distributions and capital account allocations, including incentive distributions. Undistributed earnings (net income in excess of distributions) or undistributed losses (available cash in excess of net income) are then allocated to the general partner in accordance with its weighted-average ownership percentage during each period. Series A Preferred unitholders. The Series A Preferred units are not considered a participating security as they only have distribution rights up to the specified per-unit quarterly distribution and have no rights to the Partnership’s undistributed earnings and losses. As such, the Series A Preferred unitholders’ allocation is equal to their cash distribution plus the amortization of the Series A Preferred units beneficial conversion feature (see Series A Preferred units above). Common and Class C unitholders. The Class C units are considered a participating security because they participate in distributions with common units according to a predetermined formula (see Note 3 ). The Common and Class C unitholders’ allocation is equal to their cash distributions plus their respective portions of undistributed earnings or losses. Specifically, net income equal to the amount of available cash (as defined by the partnership agreement) is allocated to the common and Class C unitholders consistent with actual cash distributions and capital account allocations. Undistributed earnings or undistributed losses are then allocated to the common and Class C unitholders in accordance with their respective weighted-average ownership percentages during each period. The common unitholder allocation also includes the impact of the amortization of the Series A Preferred units and Class C units beneficial conversion features. The Class C unitholder allocation is similarly impacted by the amortization of the Class C units beneficial conversion feature (see Class C units above). Calculation of net income (loss) per unit. Basic net income (loss) per common unit is calculated by dividing the net income (loss) attributable to common unitholders by the weighted-average number of common units outstanding during the period. The common units issued in connection with acquisitions and equity offerings are included on a weighted-average basis for periods they were outstanding. Diluted net income (loss) per common unit is calculated by dividing the sum of (i) the net income (loss) attributable to common units adjusted for distributions on the Series A Preferred units and a reallocation of the common and Class C limited partners’ interest in net income (loss) assuming conversion of the Series A Preferred units into common units, and (ii) the net income (loss) attributable to the Class C units as a participating security, by the sum of the weighted-average number of common units outstanding plus the dilutive effect of (i) the weighted-average number of outstanding Class C units and (ii) the weighted-average number of common units outstanding assuming conversion of the Series A Preferred units. |
Description of Business and B19
Description of Business and Basis of Presentation (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
Assets and Investments Table | As of March 31, 2017 , the Partnership’s assets and investments consisted of the following: Owned and Operated Operated Interests Non-Operated Interests Equity Interests Gathering systems 12 3 3 2 Treating facilities 21 3 — 3 Natural gas processing plants/trains 20 5 — 2 NGL pipelines 2 — — 3 Natural gas pipelines 5 — — — Oil pipelines — 1 — 1 |
Ownership Interest and Method of Consolidation Table | The following table outlines the Partnership’s ownership interests and the accounting method of consolidation used in the Partnership’s consolidated financial statements: Percentage Interest Equity investments (1) Fort Union 14.81 % White Cliffs 10 % Rendezvous 22 % Mont Belvieu JV 25 % TEP 20 % TEG 20 % FRP 33.33 % Proportionate consolidation (2) Marcellus Interest systems 33.75 % Newcastle system 50 % Springfield system 50.1 % Full consolidation Chipeta (3) 75 % DBJV system (4) 100 % (1) Investments in non-controlled entities over which the Partnership exercises significant influence are accounted for under the equity method. “Equity investment throughput” refers to the Partnership’s share of average throughput for these investments. (2) The Partnership proportionately consolidates its associated share of the assets, liabilities, revenues and expenses attributable to these assets. (3) The 25% interest in Chipeta Processing LLC (“Chipeta”) held by a third-party member is reflected within noncontrolling interest in the consolidated financial statements. (4) The Partnership acquired an additional 50% interest in the DBJV system (the “Additional DBJV System Interest”) from a third party on March 17, 2017. See Note 2 . |
Acquisitions and Divestitures (
Acquisitions and Divestitures (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Acquisitions Table | The following table presents the acquisitions completed by the Partnership during 2017 and 2016 , and identifies the funding sources for such acquisitions: thousands except unit and percent amounts Acquisition Date Percentage Borrowings Cash On Hand Common Units Issued Series A Preferred Units Issued Springfield system (1) 03/14/2016 50.1 % $ 247,500 $ — 2,089,602 14,030,611 DBJV system (2) 03/17/2017 50 % — 155,000 — — (1) The Partnership acquired Springfield Pipeline LLC (“Springfield”) from Anadarko for $750.0 million , consisting of $712.5 million in cash and the issuance of 1,253,761 of the Partnership’s common units. Springfield owns a 50.1% interest in an oil gathering system and a gas gathering system, such interest being referred to in this report as the “Springfield interest.” The Springfield oil and gas gathering systems (collectively, the “Springfield system”) are located in Dimmit, La Salle, Maverick and Webb Counties in South Texas. The Partnership financed the cash portion of the acquisition through: (i) borrowings of $247.5 million on the Partnership’s senior unsecured revolving credit facility (“RCF”), (ii) the issuance of 835,841 of the Partnership’s common units to WGP and (iii) the issuance of Series A Preferred units to private investors. See Note 4 for further information regarding the Series A Preferred units. (2) The Partnership acquired the Additional DBJV System Interest from a third party. See Property exchange below. |
Impact of Deferred Purchase Price Obligation Table | The following table summarizes the financial statement impact of the Deferred purchase price obligation - Anadarko: Deferred purchase price obligation - Anadarko Estimated future payment obligation (1) Balance at December 31, 2016 $ 41,440 $ 56,455 Accretion expense (2) 71 Revision to Deferred purchase price obligation – Anadarko (3) (4,165 ) Balance at March 31, 2017 $ 37,346 $ 49,694 (1) Calculated using Level 3 inputs. (2) Accretion expense was recorded as a charge to Interest expense on the consolidated statements of operations. (3) Recorded as revisions within Common units on the consolidated balance sheet and consolidated statement of equity and partners’ capital. |
Partnership Distributions (Tabl
Partnership Distributions (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Distribution Made to Limited Partner [Line Items] | |
Cash Distributions Table | The Board of Directors of our general partner (the “Board of Directors”) declared the following cash distributions to the Partnership’s common and general partner unitholders for the periods presented: thousands except per-unit amounts Quarters Ended Total Quarterly Distribution per Unit Total Quarterly Cash Distribution Date of Distribution 2016 March 31 $ 0.815 $ 158,905 May 2016 June 30 0.830 162,827 August 2016 September 30 0.845 166,742 November 2016 December 31 0.860 170,657 February 2017 2017 March 31 (1) $ 0.875 $ 188,753 May 2017 (1) The Board of Directors declared a cash distribution to the Partnership’s unitholders for the first quarter of 2017 of $0.875 per unit, or $188.8 million in aggregate, including incentive distributions, but excluding distributions on Class C units (see Class C unit distributions below) and Series A Preferred units (see Series A Preferred unit distributions below). The cash distribution is payable on May 12, 2017 , to unitholders of record at the close of business on May 1, 2017 . |
Series A Preferred Units [Member] | |
Distribution Made to Limited Partner [Line Items] | |
Cash Distributions Table | The following table summarizes the Series A Preferred unitholders’ cash distributions for the periods presented: thousands except per-unit amounts Quarters Ended Total Quarterly Distribution per Unit Total Quarterly Cash Distribution Date of Distribution 2016 March 31 (1) $ 0.68 $ 1,887 May 2016 June 30 (2) 0.68 14,082 August 2016 September 30 0.68 14,908 November 2016 December 31 0.68 14,908 February 2017 2017 March 31 (3) $ 0.68 $ 7,454 May 2017 (1) Quarterly per unit distribution prorated for the 18 -day period during which 14,030,611 Series A Preferred units were outstanding during the first quarter of 2016. (2) Full quarterly per unit distribution on 14,030,611 Series A Preferred units and quarterly per unit distribution prorated for the 77 -day period during which 7,892,220 Series A Preferred units were outstanding during the second quarter of 2016. (3) On March 1, 2017, 50% of the outstanding Series A Preferred units converted into common units on a one -for-one basis. Such converted common units were entitled only to distributions made to common unitholders with respect to the first quarter of 2017. See Note 4 . |
Equity and Partners' Capital (T
Equity and Partners' Capital (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Partners' Capital Notes [Abstract] | |
Partnership Interests Table | The following table summarizes the common, Class C, Series A Preferred and general partner units issued during the three months ended March 31, 2017 : Common Units Class C Units Series A Preferred Units General Partner Units Total Balance at December 31, 2016 130,671,970 12,358,123 21,922,831 2,583,068 167,535,992 PIK Class C units — 178,977 — — 178,977 Conversion of Series A Preferred units 10,961,415 — (10,961,415 ) — — Balance at March 31, 2017 141,633,385 12,537,100 10,961,416 2,583,068 167,714,969 |
Calculation of Net Income (Loss) Per Unit Table | The following table illustrates the Partnership’s calculation of net income (loss) per unit for common units: Three Months Ended thousands except per-unit amounts 2017 2016 Net income (loss) attributable to Western Gas Partners, LP $ 101,889 $ 116,060 Pre-acquisition net (income) loss allocated to Anadarko — (11,326 ) Series A Preferred units interest in net (income) loss (1) (28,174 ) (2,329 ) General partner interest in net (income) loss (68,162 ) (55,400 ) Common and Class C limited partners’ interest in net income (loss) $ 5,553 $ 47,005 Net income (loss) allocable to common units (1) $ 1,714 $ 39,562 Net income (loss) allocable to Class C units (1) 3,839 7,443 Common and Class C limited partners’ interest in net income (loss) $ 5,553 $ 47,005 Net income (loss) per unit Common units – basic and diluted (2) $ 0.01 $ 0.31 Weighted-average units outstanding Common units – basic and diluted 134,448 128,990 Excluded due to anti-dilutive effect: Class C units (2) 12,452 11,590 Series A Preferred units assuming conversion to common units (2) 18,147 2,775 (1) Adjusted to reflect amortization of the beneficial conversion features. (2) The impact of Class C units and the conversion of Series A Preferred units would be anti-dilutive. |
Transactions with Affiliates (T
Transactions with Affiliates (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Related Party Fees and Other Arrangements, Limited Liability Company (LLC) or Limited Partnership (LP) [Abstract] | |
Gains (Losses) on Commodity Price Swap Agreements Table | The following table summarizes gains and losses upon settlement of commodity price swap agreements recognized in the consolidated statements of operations: Three Months Ended thousands 2017 2016 Gains (losses) on commodity price swap agreements related to sales: (1) Natural gas sales $ 1,082 $ 7,041 Natural gas liquids sales (4,307 ) 20,070 Total (3,225 ) 27,111 Gains (losses) on commodity price swap agreements related to purchases (2) 2,696 (18,871 ) Net gains (losses) on commodity price swap agreements $ (529 ) $ 8,240 (1) Reported in affiliate Natural gas and natural gas liquids sales in the consolidated statements of operations in the period in which the related sale is recorded. (2) Reported in Cost of product in the consolidated statements of operations in the period in which the related purchase is recorded. |
Commodity Price Swap Agreements Extensions Tables | The tables below summarize the swap prices compared to the forward market prices: DJ Basin Complex per barrel except natural gas 2016 - 2017 Swap Prices 2016 Market Prices (1) 2017 Market Prices (1) Ethane $ 18.41 $ 0.60 $ 5.09 Propane 47.08 10.98 18.85 Isobutane 62.09 17.23 26.83 Normal butane 54.62 16.86 26.20 Natural gasoline 72.88 26.15 41.84 Condensate 76.47 34.65 45.40 Natural gas (per MMBtu) 5.96 2.11 3.05 (1) Represents the New York Mercantile Exchange (“NYMEX”) forward strip price as of December 8, 2015 and December 1, 2016, for the 2016 Market Prices and 2017 Market Prices, respectively, adjusted for product specification, location, basis and, in the case of NGLs, transportation and fractionation costs. 5. TRANSACTIONS WITH AFFILIATES (CONTINUED) MGR Assets per barrel except natural gas 2016 - 2017 Swap Prices 2017 Market Prices (1) Ethane $ 23.11 $ 4.08 Propane 52.90 19.24 Isobutane 73.89 25.79 Normal butane 64.93 25.16 Natural gasoline 81.68 45.01 Condensate 81.68 53.55 Natural gas (per MMBtu) 4.87 3.05 (1) Represents the NYMEX forward strip price as of December 1, 2016, adjusted for product specification, location, basis and, in the case of NGLs, transportation and fractionation costs. |
Related Party Transactions Tables | The following table summarizes the Partnership’s purchases from Anadarko of pipe and equipment: Three Months Ended March 31, 2017 2016 thousands Purchases Cash consideration $ — $ 1,096 Payable to affiliate — 990 Net carrying value — (1,372 ) Partners’ capital adjustment $ — $ 714 The following table summarizes material affiliate transactions. See Note 2 for discussion of affiliate acquisitions and related funding. Three Months Ended thousands 2017 2016 Revenues and other (1) $ 315,155 $ 272,584 Equity income, net – affiliates (1) 19,461 16,814 Cost of product (1) 15,988 24,580 Operation and maintenance (2) 17,089 17,975 General and administrative (3) 9,535 8,952 Operating expenses 42,612 51,507 Interest income (4) 4,225 4,225 Interest expense (5) 71 4,537 Proceeds from the issuance of common units, net of offering expenses (6) — 25,000 Distributions to unitholders (7) 103,123 89,769 Above-market component of swap extensions with Anadarko 12,297 6,813 (1) Represents amounts earned or incurred on and subsequent to the date of the acquisition of Partnership assets, as well as amounts earned or incurred by Anadarko on a historical basis related to the Partnership assets prior to the acquisition of such assets, recognized under gathering, treating or processing agreements, and purchase and sale agreements. (2) Represents expenses incurred on and subsequent to the date of the acquisition of Partnership assets, as well as expenses incurred by Anadarko on a historical basis related to the Partnership assets prior to the acquisition of such assets. (3) Represents general and administrative expense incurred on and subsequent to the date of the Partnership’s acquisition of the Partnership assets, as well as a management services fee for reimbursement of expenses incurred by Anadarko for periods prior to the acquisition of the Partnership assets by the Partnership. These amounts include equity-based compensation expense allocated to the Partnership by Anadarko (see WES LTIP and WGP LTIP and Anadarko Incentive Plan within this Note 5 ). (4) Represents interest income recognized on the note receivable from Anadarko. (5) Includes amounts related to the Deferred purchase price obligation - Anadarko (see Note 2 and Note 9 ). (6) Represents proceeds from the issuance of 835,841 common units to WGP as partial funding for the acquisition of Springfield (see Note 2 ). (7) Represents distributions paid under the partnership agreement (see Note 3 and Note 4 ). |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment Table | A summary of the historical cost of the Partnership’s property, plant and equipment is as follows: thousands Estimated Useful Life March 31, 2017 December 31, 2016 Land n/a $ 4,021 $ 4,012 Gathering systems and processing complexes 3 to 47 years 6,836,748 6,462,053 Pipelines and equipment 15 to 45 years 139,376 139,646 Assets under construction n/a 230,898 226,626 Other 3 to 40 years 29,851 29,605 Total property, plant and equipment 7,240,894 6,861,942 Accumulated depreciation 1,974,081 1,812,010 Net property, plant and equipment $ 5,266,813 $ 5,049,932 |
Equity Investments (Tables)
Equity Investments (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity Investments Table | The following table presents the activity in the Partnership’s equity investments for the three months ended March 31, 2017 : Equity Investments thousands Fort White Rendezvous Mont TEG TEP FRP Total Balance at December 31, 2016 $ 12,833 $ 47,319 $ 46,739 $ 112,805 $ 15,846 $ 189,194 $ 169,472 $ 594,208 Investment earnings (loss), net of amortization 805 3,098 249 6,863 367 4,276 3,803 19,461 Distributions (845 ) (2,952 ) (734 ) (6,125 ) (272 ) (4,339 ) (3,847 ) (19,114 ) Distributions in excess of cumulative earnings (1) — (615 ) (809 ) — — (851 ) (1,178 ) (3,453 ) Balance at March 31, 2017 $ 12,793 $ 46,850 $ 45,445 $ 113,543 $ 15,941 $ 188,280 $ 168,250 $ 591,102 (1) Distributions in excess of cumulative earnings, classified as investing cash flows in the consolidated statements of cash flows, is calculated on an individual investment basis. |
Components of Working Capital (
Components of Working Capital (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Components Of Working Capital [Abstract] | |
Accounts Receivable, Net Table | A summary of accounts receivable, net is as follows: thousands March 31, 2017 December 31, 2016 Trade receivables, net $ 152,654 $ 192,808 Other receivables, net 77 30,415 Total accounts receivable, net $ 152,731 $ 223,223 |
Other Current Assets Table | A summary of other current assets is as follows: thousands March 31, 2017 December 31, 2016 Natural gas liquids inventory $ 8,348 $ 7,126 Imbalance receivables 977 3,483 Prepaid insurance 1,253 2,257 Total other current assets $ 10,578 $ 12,866 |
Accrued Liabilities Table | A summary of accrued liabilities is as follows: thousands March 31, 2017 December 31, 2016 Accrued interest expense $ 45,574 $ 39,826 Short-term asset retirement obligations 6,678 3,114 Short-term remediation and reclamation obligations 630 630 Income taxes payable 1,430 1,006 Other 3,684 532 Total accrued liabilities $ 57,996 $ 45,108 |
Debt and Interest Expense (Tabl
Debt and Interest Expense (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Debt Instruments [Abstract] | |
Debt Outstanding and Debt Activity Tables | The following table presents the Partnership’s outstanding debt as of March 31, 2017 , and December 31, 2016 : March 31, 2017 December 31, 2016 thousands Principal Carrying Value Fair Value (1) Principal Carrying Value Fair Value (1) 2021 Notes $ 500,000 $ 494,999 $ 537,815 $ 500,000 $ 494,734 $ 536,252 2022 Notes 670,000 668,688 688,423 670,000 668,634 681,723 2018 Notes 350,000 349,311 351,970 350,000 349,188 351,531 2044 Notes 600,000 593,152 614,253 600,000 593,132 615,753 2025 Notes 500,000 491,196 494,066 500,000 490,971 492,499 2026 Notes 500,000 494,911 514,065 500,000 494,802 518,441 Total long-term debt $ 3,120,000 $ 3,092,257 $ 3,200,592 $ 3,120,000 $ 3,091,461 $ 3,196,199 (1) Fair value is measured using the market approach and Level 2 inputs. Debt activity. The following table presents the debt activity of the Partnership for the three months ended March 31, 2017 : thousands Carrying Value Balance at December 31, 2016 $ 3,091,461 Other 796 Balance at March 31, 2017 $ 3,092,257 |
Interest Expense Table | The following table summarizes the amounts included in interest expense: Three Months Ended thousands 2017 2016 Third parties Long-term debt $ (34,619 ) $ (27,818 ) Amortization of debt issuance costs and commitment fees (1,630 ) (1,530 ) Capitalized interest 816 1,849 Total interest expense – third parties (35,433 ) (27,499 ) Affiliates Deferred purchase price obligation – Anadarko (1) (71 ) (4,537 ) Total interest expense – affiliates (71 ) (4,537 ) Interest expense $ (35,504 ) $ (32,036 ) (1) See Note 2 for a discussion of the Deferred purchase price obligation - Anadarko. |
Description of Business and B28
Description of Business and Basis of Presentation - Assets and Investments Table (Details) | Mar. 31, 2017unit |
Owned and Operated [Member] | Gathering Systems [Member] | |
Assets [Line Items] | |
Assets, number of units | 12 |
Owned and Operated [Member] | Treating Facilities [Member] | |
Assets [Line Items] | |
Assets, number of units | 21 |
Owned and Operated [Member] | Natural Gas Processing Plants/Trains [Member] | |
Assets [Line Items] | |
Assets, number of units | 20 |
Owned and Operated [Member] | Natural Gas Liquids Pipelines [Member] | |
Assets [Line Items] | |
Assets, number of units | 2 |
Owned and Operated [Member] | Natural Gas Pipelines [Member] | |
Assets [Line Items] | |
Assets, number of units | 5 |
Operated Interests [Member] | Gathering Systems [Member] | |
Assets [Line Items] | |
Assets, number of units | 3 |
Operated Interests [Member] | Treating Facilities [Member] | |
Assets [Line Items] | |
Assets, number of units | 3 |
Operated Interests [Member] | Natural Gas Processing Plants/Trains [Member] | |
Assets [Line Items] | |
Assets, number of units | 5 |
Operated Interests [Member] | Oil Pipelines [Member] | |
Assets [Line Items] | |
Assets, number of units | 1 |
Non-Operated Interests [Member] | Gathering Systems [Member] | |
Assets [Line Items] | |
Assets, number of units | 3 |
Equity Interests [Member] | Gathering Systems [Member] | |
Assets [Line Items] | |
Assets, number of units | 2 |
Equity Interests [Member] | Treating Facilities [Member] | |
Assets [Line Items] | |
Assets, number of units | 3 |
Equity Interests [Member] | Natural Gas Processing Plants/Trains [Member] | |
Assets [Line Items] | |
Assets, number of units | 2 |
Equity Interests [Member] | Natural Gas Liquids Pipelines [Member] | |
Assets [Line Items] | |
Assets, number of units | 3 |
Equity Interests [Member] | Oil Pipelines [Member] | |
Assets [Line Items] | |
Assets, number of units | 1 |
Description of Business and B29
Description of Business and Basis of Presentation - Ownership Interest and Method of Consolidation Table (Details) | Mar. 17, 2017 | Mar. 31, 2017 | |
Chipeta Processing LLC [Member] | |||
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |||
Ownership interest by noncontrolling interest owner | 25.00% | ||
Delaware Basin JV Gathering LLC [Member] | |||
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |||
Ownership percentage acquired | [1] | 50.00% | |
Equity Investments [Member] | Fort Union [Member] | |||
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |||
Percentage ownership interest | [2] | 14.81% | |
Equity Investments [Member] | White Cliffs [Member] | |||
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |||
Percentage ownership interest | [2] | 10.00% | |
Equity Investments [Member] | Rendezvous [Member] | |||
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |||
Percentage ownership interest | [2] | 22.00% | |
Equity Investments [Member] | Mont Belvieu JV [Member] | |||
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |||
Percentage ownership interest | [2] | 25.00% | |
Equity Investments [Member] | Texas Express Pipeline LLC [Member] | |||
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |||
Percentage ownership interest | [2] | 20.00% | |
Equity Investments [Member] | Texas Express Gathering LLC [Member] | |||
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |||
Percentage ownership interest | [2] | 20.00% | |
Equity Investments [Member] | Front Range Pipeline LLC [Member] | |||
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |||
Percentage ownership interest | [2] | 33.33% | |
Proportionate Consolidation [Member] | Marcellus Interest [Member] | |||
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |||
Percentage ownership interest | [3] | 33.75% | |
Proportionate Consolidation [Member] | Newcastle [Member] | |||
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |||
Percentage ownership interest | [3] | 50.00% | |
Proportionate Consolidation [Member] | Springfield [Member] | |||
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |||
Percentage ownership interest | [3] | 50.10% | |
Full Consolidation [Member] | Chipeta Processing LLC [Member] | |||
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |||
Percentage ownership interest | [4] | 75.00% | |
Full Consolidation [Member] | Delaware Basin JV Gathering LLC [Member] | |||
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |||
Percentage ownership interest | [5] | 100.00% | |
[1] | The Partnership acquired the Additional DBJV System Interest from a third party. See Property exchange below. | ||
[2] | Investments in non-controlled entities over which the Partnership exercises significant influence are accounted for under the equity method. “Equity investment throughput” refers to the Partnership’s share of average throughput for these investments. | ||
[3] | The Partnership proportionately consolidates its associated share of the assets, liabilities, revenues and expenses attributable to these assets. | ||
[4] | The 25% interest in Chipeta Processing LLC (“Chipeta”) held by a third-party member is reflected within noncontrolling interest in the consolidated financial statements. | ||
[5] | The Partnership acquired an additional 50% interest in the DBJV system (the “Additional DBJV System Interest”) from a third party on March 17, 2017. See Note 2. |
Description of Business and B30
Description of Business and Basis of Presentation - Additional Information (Details) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2017USD ($)Mcf / d | Mar. 31, 2016USD ($) | Dec. 31, 2016USD ($) | |
Loss on divestiture and other, net | $ (119,487) | $ 632 | |
Proceeds from property insurance claims | 24,000 | $ 0 | |
Delaware Basin Midstream Complex [Member] | |||
Loss on divestiture and other, net | 5,700 | ||
Property insurance claim receivable | 0 | $ 30,000 | |
Proceeds from insurance claims, total | 29,800 | ||
Proceeds from business interruption insurance claims | 5,767 | ||
Proceeds from property insurance claims | $ 24,000 | ||
Delaware Basin Midstream Complex [Member] | Train II [Member] | |||
Plant capacity | Mcf / d | 100,000 | ||
Delaware Basin Midstream Complex [Member] | Train III [Member] | |||
Plant capacity | Mcf / d | 200,000 |
Acquisitions and Divestitures -
Acquisitions and Divestitures - Acquisitions Table (Details) - USD ($) $ in Thousands | Mar. 17, 2017 | Mar. 14, 2016 | Mar. 31, 2017 | |
Business Acquisition [Line Items] | ||||
Units issued | 178,977 | |||
Springfield [Member] | ||||
Business Acquisition [Line Items] | ||||
Ownership percentage acquired | [1] | 50.10% | ||
Acquisition price | $ 750,000 | |||
Cash payment for acquisition | $ 712,500 | |||
Springfield [Member] | Common Units [Member] | ||||
Business Acquisition [Line Items] | ||||
Units issued | [1] | 2,089,602 | ||
Springfield [Member] | Common Units [Member] | Anadarko [Member] | ||||
Business Acquisition [Line Items] | ||||
Units issued | 1,253,761 | |||
Springfield [Member] | Common Units [Member] | Western Gas Equity Partners, LP [Member] | ||||
Business Acquisition [Line Items] | ||||
Units issued | 835,841 | |||
Springfield [Member] | Series A Preferred Units [Member] | ||||
Business Acquisition [Line Items] | ||||
Units issued | [1] | 14,030,611 | ||
Springfield [Member] | Revolving Credit Facility [Member] | ||||
Business Acquisition [Line Items] | ||||
Borrowings - revolving credit facility | [1] | $ 247,500 | ||
Delaware Basin JV Gathering LLC [Member] | ||||
Business Acquisition [Line Items] | ||||
Ownership percentage acquired | [2] | 50.00% | ||
Cash on hand | [2] | $ 155,000 | ||
[1] | The Partnership acquired Springfield Pipeline LLC (“Springfield”) from Anadarko for $750.0 million, consisting of $712.5 million in cash and the issuance of 1,253,761 of the Partnership’s common units. Springfield owns a 50.1% interest in an oil gathering system and a gas gathering system, such interest being referred to in this report as the “Springfield interest.” The Springfield oil and gas gathering systems (collectively, the “Springfield system”) are located in Dimmit, La Salle, Maverick and Webb Counties in South Texas. The Partnership financed the cash portion of the acquisition through: (i) borrowings of $247.5 million on the Partnership’s senior unsecured revolving credit facility (“RCF”), (ii) the issuance of 835,841 of the Partnership’s common units to WGP and (iii) the issuance of Series A Preferred units to private investors. See Note 4 for further information regarding the Series A Preferred units. | |||
[2] | The Partnership acquired the Additional DBJV System Interest from a third party. See Property exchange below. |
Acquisitions and Divestitures32
Acquisitions and Divestitures - Impact of the Deferred Purchase Price Obligation - Anadarko Table (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | ||
Property, Plant and Equipment [Line Items] | ||||
Deferred purchase price obligation - Anadarko, present value | [1] | $ 37,346 | $ 41,440 | |
Affiliates [Member] | Deferred Purchase Price Obligation - Anadarko [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Accretion expense | [2] | 71 | $ 4,537 | |
Affiliates [Member] | Delaware Basin JV Gathering LLC [Member] | Deferred Purchase Price Obligation - Anadarko [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Deferred purchase price obligation - Anadarko, present value | 37,346 | 41,440 | ||
Accretion expense | [3] | 71 | ||
Revision to Deferred purchase price obligation – Anadarko | [4] | (4,165) | ||
Deferred purchase price obligation - Anadarko, future value | [5] | $ 49,694 | $ 56,455 | |
[1] | See Note 2. | |||
[2] | See Note 2 for a discussion of the Deferred purchase price obligation - Anadarko. | |||
[3] | Accretion expense was recorded as a charge to Interest expense on the consolidated statements of operations. | |||
[4] | Recorded as revisions within Common units on the consolidated balance sheet and consolidated statement of equity and partners’ capital. | |||
[5] | Calculated using Level 3 inputs. |
Acquisitions and Divestitures33
Acquisitions and Divestitures - Additional Information (Details) - USD ($) $ in Thousands | Mar. 17, 2017 | Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | |
Property, Plant and Equipment [Line Items] | |||||
Deferred purchase price obligation - Anadarko, present value | [1] | $ 37,346 | $ 41,440 | ||
Hugoton System [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Loss on sale of assets | 12,000 | ||||
Goodwill allocated to divestiture | 1,600 | ||||
Affiliates [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Cash payment | 0 | $ 713,596 | |||
Delaware Basin JV Gathering LLC [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Percentage ownership interest | 50.00% | ||||
Cash payment | [2] | $ 155,000 | |||
Net gain from property exchange | 125,400 | ||||
Delaware Basin JV Gathering LLC [Member] | Deferred Purchase Price Obligation - Anadarko [Member] | Affiliates [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Deferred purchase price obligation - Anadarko, future value change | 6,800 | ||||
Deferred purchase price obligation - Anadarko, present value | $ 37,346 | $ 41,440 | |||
Discount rate percentage | 10.00% | ||||
Non-Operated Marcellus Interest [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Percentage ownership interest | 33.75% | ||||
[1] | See Note 2. | ||||
[2] | The Partnership acquired the Additional DBJV System Interest from a third party. See Property exchange below. |
Partnership Distributions - Cas
Partnership Distributions - Cash Distributions Table (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |||||
Mar. 31, 2017 | [1] | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | |
Distributions Made to Members or Limited Partners [Abstract] | ||||||
Total quarterly distribution per unit | $ 0.875 | $ 0.860 | $ 0.845 | $ 0.830 | $ 0.815 | |
Total quarterly cash distribution | $ 188,753 | $ 170,657 | $ 166,742 | $ 162,827 | $ 158,905 | |
[1] | The Board of Directors declared a cash distribution to the Partnership’s unitholders for the first quarter of 2017 of $0.875 per unit, or $188.8 million in aggregate, including incentive distributions, but excluding distributions on Class C units (see Class C unit distributions below) and Series A Preferred units (see Series A Preferred unit distributions below). The cash distribution is payable on May 12, 2017, to unitholders of record at the close of business on May 1, 2017. |
Partnership Distributions - Ser
Partnership Distributions - Series A Preferred Unit Distributions Table (Details) - USD ($) $ / shares in Units, $ in Thousands | Mar. 01, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2016 | |||
Distribution Made to Limited Partner [Line Items] | ||||||||||
Units issued | 178,977 | |||||||||
Series A Preferred Units [Member] | ||||||||||
Distribution Made to Limited Partner [Line Items] | ||||||||||
Series A Preferred units quarterly distribution per unit | $ 0.68 | [1] | $ 0.68 | $ 0.68 | $ 0.68 | [2] | $ 0.68 | [3] | ||
Series A Preferred units quarterly cash distribution | $ 7,454 | [1] | $ 14,908 | $ 14,908 | $ 14,082 | [2] | $ 1,887 | [3] | ||
Number of days in prorated period | 77 days | 18 days | ||||||||
Series A Preferred units, units issued upon conversion | 1 | |||||||||
Series A Preferred Units [Member] | Series A Preferred Units March 2017 Conversion [Member] | ||||||||||
Distribution Made to Limited Partner [Line Items] | ||||||||||
Series A Preferred units, percentage converted | 50.00% | |||||||||
Series A Preferred units, units issued upon conversion | 1 | |||||||||
Series A Preferred Units [Member] | Private Investor [Member] | ||||||||||
Distribution Made to Limited Partner [Line Items] | ||||||||||
Units issued | 14,030,611 | 21,922,831 | ||||||||
Series A Preferred Units [Member] | Private Investor [Member] | Over-Allotment Option [Member] | ||||||||||
Distribution Made to Limited Partner [Line Items] | ||||||||||
Units issued | 7,892,220 | |||||||||
[1] | On March 1, 2017, 50% of the outstanding Series A Preferred units converted into common units on a one-for-one basis. Such converted common units were entitled only to distributions made to common unitholders with respect to the first quarter of 2017. See Note 4. | |||||||||
[2] | Full quarterly per unit distribution on 14,030,611 Series A Preferred units and quarterly per unit distribution prorated for the 77-day period during which 7,892,220 Series A Preferred units were outstanding during the second quarter of 2016. | |||||||||
[3] | Quarterly per unit distribution prorated for the 18-day period during which 14,030,611 Series A Preferred units were outstanding during the first quarter of 2016. |
Partnership Distributions - Add
Partnership Distributions - Additional Information (Details) - $ / shares | 3 Months Ended | |||||||
Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | [2] | Mar. 31, 2016 | [3] | ||
Distribution Made to Limited Partner [Line Items] | ||||||||
Partnership agreement day requirement of distribution of available cash | 45 days | |||||||
Incentive distributions percentage | 48.00% | |||||||
Minimum [Member] | ||||||||
Distribution Made to Limited Partner [Line Items] | ||||||||
Distribution sharing percentage | 1.50% | |||||||
Maximum [Member] | ||||||||
Distribution Made to Limited Partner [Line Items] | ||||||||
Distribution sharing percentage | 49.50% | |||||||
Class C Units [Member] | ||||||||
Distribution Made to Limited Partner [Line Items] | ||||||||
Discount rate percentage | 6.00% | |||||||
Series A Preferred Units [Member] | ||||||||
Distribution Made to Limited Partner [Line Items] | ||||||||
Series A Preferred units quarterly distribution per unit | $ 0.68 | [1] | $ 0.68 | $ 0.68 | $ 0.68 | $ 0.68 | ||
[1] | On March 1, 2017, 50% of the outstanding Series A Preferred units converted into common units on a one-for-one basis. Such converted common units were entitled only to distributions made to common unitholders with respect to the first quarter of 2017. See Note 4. | |||||||
[2] | Full quarterly per unit distribution on 14,030,611 Series A Preferred units and quarterly per unit distribution prorated for the 77-day period during which 7,892,220 Series A Preferred units were outstanding during the second quarter of 2016. | |||||||
[3] | Quarterly per unit distribution prorated for the 18-day period during which 14,030,611 Series A Preferred units were outstanding during the first quarter of 2016. |
Equity and Partners' Capital -
Equity and Partners' Capital - Partnership Interests Table (Details) | 3 Months Ended |
Mar. 31, 2017shares | |
Capital Unit [Line Items] | |
Balance | 167,535,992 |
Units issued | 178,977 |
Conversion of Series A Preferred units | 0 |
Balance | 167,714,969 |
Common Units [Member] | |
Capital Unit [Line Items] | |
Balance | 130,671,970 |
Conversion of Series A Preferred units | 10,961,415 |
Balance | 141,633,385 |
Class C Units [Member] | |
Capital Unit [Line Items] | |
Balance | 12,358,123 |
Units issued | 178,977 |
Balance | 12,537,100 |
Series A Preferred Units [Member] | |
Capital Unit [Line Items] | |
Balance | 21,922,831 |
Conversion of Series A Preferred units | (10,961,415) |
Balance | 10,961,416 |
General Partner [Member] | |
Capital Unit [Line Items] | |
Balance | 2,583,068 |
Balance | 2,583,068 |
Equity and Partners' Capital 38
Equity and Partners' Capital - Calculation of Net Income (Loss) Per Unit Table (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | ||
Earnings Per Unit [Line Items] | |||
Net income (loss) attributable to Western Gas Partners, LP | $ 101,889 | $ 116,060 | |
Pre-acquisition net (income) loss allocated to Anadarko | 0 | (11,326) | |
General partner interest in net (income) loss | [1] | $ (68,162) | $ (55,400) |
Net income (loss) per common unit – basic and diluted | [2],[3] | $ 0.01 | $ 0.31 |
Series A Preferred Units [Member] | |||
Earnings Per Unit [Line Items] | |||
Limited partners’ interest in net income (loss) | [4] | $ 28,174 | $ 2,329 |
Anti-dilutive units excluded from computation of earnings per unit | [3] | 18,147 | 2,775 |
Common and Class C Units [Member] | |||
Earnings Per Unit [Line Items] | |||
Limited partners’ interest in net income (loss) | [1] | $ 5,553 | $ 47,005 |
Common Units [Member] | |||
Earnings Per Unit [Line Items] | |||
Limited partners’ interest in net income (loss) | [4] | $ 1,714 | $ 39,562 |
Weighted-average units outstanding - basic and diluted | 134,448 | 128,990 | |
Class C Units [Member] | |||
Earnings Per Unit [Line Items] | |||
Limited partners’ interest in net income (loss) | [4] | $ 3,839 | $ 7,443 |
Anti-dilutive units excluded from computation of earnings per unit | [3] | 12,452 | 11,590 |
[1] | Represents net income (loss) earned on and subsequent to the date of acquisition of the Partnership assets (as defined in Note 1). See Note 4. | ||
[2] | See Note 4 for the calculation of net income (loss) per common unit. | ||
[3] | The impact of Class C units and the conversion of Series A Preferred units would be anti-dilutive. | ||
[4] | Adjusted to reflect amortization of the beneficial conversion features. |
Equity and Partners' Capital 39
Equity and Partners' Capital - Additional Information (Details) - USD ($) $ in Thousands | Mar. 01, 2017 | Nov. 30, 2014 | Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | Dec. 31, 2014 |
Schedule Of Investments [Line Items] | ||||||
Units issued | 178,977 | |||||
Amortization of beneficial conversion feature of Series A Preferred units | $ 0 | |||||
General partner units owned | 2,583,068 | 2,583,068 | ||||
Western Gas Equity Partners, LP [Member] | ||||||
Schedule Of Investments [Line Items] | ||||||
General partner units owned | 2,583,068 | |||||
General partner's interest | 1.50% | |||||
Common Units [Member] | ||||||
Schedule Of Investments [Line Items] | ||||||
Limited partner units owned | 141,633,385 | 130,671,970 | ||||
Common Units [Member] | Western Gas Equity Partners, LP [Member] | ||||||
Schedule Of Investments [Line Items] | ||||||
Limited partner units owned | 50,132,046 | |||||
Limited partner ownership interest | 29.90% | |||||
Common Units [Member] | Other Subsidiaries Of Anadarko [Member] | ||||||
Schedule Of Investments [Line Items] | ||||||
Limited partner units owned | 2,011,380 | |||||
Common Units [Member] | Public [Member] | ||||||
Schedule Of Investments [Line Items] | ||||||
Limited partner units owned | 89,489,959 | |||||
Limited partner ownership interest | 53.40% | |||||
Class C Units [Member] | ||||||
Schedule Of Investments [Line Items] | ||||||
Units issued | 178,977 | |||||
Class C units, units issued upon conversion | 1 | |||||
Beneficial conversion feature | $ 34,800 | |||||
Limited partner units owned | 12,537,100 | 12,358,123 | ||||
Class C Units [Member] | Other Subsidiaries Of Anadarko [Member] | ||||||
Schedule Of Investments [Line Items] | ||||||
Units issued | 10,913,853 | |||||
Limited partner units owned | 12,537,100 | |||||
Series A Preferred Units [Member] | ||||||
Schedule Of Investments [Line Items] | ||||||
Beneficial conversion feature | $ 14,200 | $ 93,400 | ||||
Series A Preferred units, units issued upon conversion | 1 | |||||
Amortization of beneficial conversion feature of Series A Preferred units | $ 48,100 | |||||
Limited partner units owned | 10,961,416 | 21,922,831 | ||||
Series A Preferred Units [Member] | Series A Preferred Units March 2017 Conversion [Member] | ||||||
Schedule Of Investments [Line Items] | ||||||
Series A Preferred units, percentage converted | 50.00% | |||||
Series A Preferred units, units issued upon conversion | 1 | |||||
Series A Preferred Units [Member] | Series A Preferred Units May 2017 Conversion [Member] | ||||||
Schedule Of Investments [Line Items] | ||||||
Series A Preferred units, percentage converted | 50.00% | |||||
Series A Preferred Units [Member] | Private Investor [Member] | ||||||
Schedule Of Investments [Line Items] | ||||||
Units issued | 14,030,611 | 21,922,831 | ||||
Limited partner units owned | 10,961,416 | |||||
Limited partner ownership interest | 6.50% | |||||
Incentive Distribution Rights [Member] | Western Gas Equity Partners, LP [Member] | ||||||
Schedule Of Investments [Line Items] | ||||||
General partner's interest | 100.00% | |||||
Common and Class C Units [Member] | Other Subsidiaries Of Anadarko [Member] | ||||||
Schedule Of Investments [Line Items] | ||||||
Limited partner ownership interest | 8.70% |
Transactions with Affiliates -
Transactions with Affiliates - Gains (Losses) on Commodity Price Swap Agreements Table (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | ||
Gains (losses) on commodity price swap agreements related to sales and purchases | |||
Gains (losses) on commodity price swap agreements | $ (529) | $ 8,240 | |
Sales [Member] | |||
Gains (losses) on commodity price swap agreements related to sales and purchases | |||
Gains (losses) on commodity price swap agreements | [1] | (3,225) | 27,111 |
Sales [Member] | Natural Gas [Member] | |||
Gains (losses) on commodity price swap agreements related to sales and purchases | |||
Gains (losses) on commodity price swap agreements | [1] | 1,082 | 7,041 |
Sales [Member] | Natural Gas Liquids [Member] | |||
Gains (losses) on commodity price swap agreements related to sales and purchases | |||
Gains (losses) on commodity price swap agreements | [1] | (4,307) | 20,070 |
Purchases [Member] | |||
Gains (losses) on commodity price swap agreements related to sales and purchases | |||
Gains (losses) on commodity price swap agreements | [2] | $ 2,696 | $ (18,871) |
[1] | Reported in affiliate Natural gas and natural gas liquids sales in the consolidated statements of operations in the period in which the related sale is recorded. | ||
[2] | Reported in Cost of product in the consolidated statements of operations in the period in which the related purchase is recorded. |
Transactions with Affiliates 41
Transactions with Affiliates - Commodity Price Swap Agreements Extensions Tables (Details) | Mar. 31, 2017$ / MMBTU$ / bbl | Dec. 01, 2016$ / MMBTU$ / bbl | Dec. 08, 2015$ / MMBTU$ / bbl | |
DJ Basin Complex [Member] | Years 2016 - 2017 [Member] | Ethane [Member] | ||||
Commodity Price Risk Swap [Line Items] | ||||
Commodity swap fixed price | 18.41 | |||
DJ Basin Complex [Member] | Years 2016 - 2017 [Member] | Propane [Member] | ||||
Commodity Price Risk Swap [Line Items] | ||||
Commodity swap fixed price | 47.08 | |||
DJ Basin Complex [Member] | Years 2016 - 2017 [Member] | Isobutane [Member] | ||||
Commodity Price Risk Swap [Line Items] | ||||
Commodity swap fixed price | 62.09 | |||
DJ Basin Complex [Member] | Years 2016 - 2017 [Member] | Normal butane [Member] | ||||
Commodity Price Risk Swap [Line Items] | ||||
Commodity swap fixed price | 54.62 | |||
DJ Basin Complex [Member] | Years 2016 - 2017 [Member] | Natural gasoline [Member] | ||||
Commodity Price Risk Swap [Line Items] | ||||
Commodity swap fixed price | 72.88 | |||
DJ Basin Complex [Member] | Years 2016 - 2017 [Member] | Condensate [Member] | ||||
Commodity Price Risk Swap [Line Items] | ||||
Commodity swap fixed price | 76.47 | |||
DJ Basin Complex [Member] | Years 2016 - 2017 [Member] | Natural gas (per MMBtu) [Member] | ||||
Commodity Price Risk Swap [Line Items] | ||||
Commodity swap fixed price | $ / MMBTU | 5.96 | |||
DJ Basin Complex [Member] | Year 2016 [Member] | Ethane [Member] | ||||
Commodity Price Risk Swap [Line Items] | ||||
Commodity market price | [1] | 0.60 | ||
DJ Basin Complex [Member] | Year 2016 [Member] | Propane [Member] | ||||
Commodity Price Risk Swap [Line Items] | ||||
Commodity market price | [1] | 10.98 | ||
DJ Basin Complex [Member] | Year 2016 [Member] | Isobutane [Member] | ||||
Commodity Price Risk Swap [Line Items] | ||||
Commodity market price | [1] | 17.23 | ||
DJ Basin Complex [Member] | Year 2016 [Member] | Normal butane [Member] | ||||
Commodity Price Risk Swap [Line Items] | ||||
Commodity market price | [1] | 16.86 | ||
DJ Basin Complex [Member] | Year 2016 [Member] | Natural gasoline [Member] | ||||
Commodity Price Risk Swap [Line Items] | ||||
Commodity market price | [1] | 26.15 | ||
DJ Basin Complex [Member] | Year 2016 [Member] | Condensate [Member] | ||||
Commodity Price Risk Swap [Line Items] | ||||
Commodity market price | [1] | 34.65 | ||
DJ Basin Complex [Member] | Year 2016 [Member] | Natural gas (per MMBtu) [Member] | ||||
Commodity Price Risk Swap [Line Items] | ||||
Commodity market price | $ / MMBTU | [1] | 2.11 | ||
DJ Basin Complex [Member] | Year 2017 [Member] | Ethane [Member] | ||||
Commodity Price Risk Swap [Line Items] | ||||
Commodity market price | [1] | 5.09 | ||
DJ Basin Complex [Member] | Year 2017 [Member] | Propane [Member] | ||||
Commodity Price Risk Swap [Line Items] | ||||
Commodity market price | [1] | 18.85 | ||
DJ Basin Complex [Member] | Year 2017 [Member] | Isobutane [Member] | ||||
Commodity Price Risk Swap [Line Items] | ||||
Commodity market price | [1] | 26.83 | ||
DJ Basin Complex [Member] | Year 2017 [Member] | Normal butane [Member] | ||||
Commodity Price Risk Swap [Line Items] | ||||
Commodity market price | [1] | 26.20 | ||
DJ Basin Complex [Member] | Year 2017 [Member] | Natural gasoline [Member] | ||||
Commodity Price Risk Swap [Line Items] | ||||
Commodity market price | [1] | 41.84 | ||
DJ Basin Complex [Member] | Year 2017 [Member] | Condensate [Member] | ||||
Commodity Price Risk Swap [Line Items] | ||||
Commodity market price | [1] | 45.40 | ||
DJ Basin Complex [Member] | Year 2017 [Member] | Natural gas (per MMBtu) [Member] | ||||
Commodity Price Risk Swap [Line Items] | ||||
Commodity market price | $ / MMBTU | [1] | 3.05 | ||
MGR Assets [Member] | Years 2016 - 2017 [Member] | Ethane [Member] | ||||
Commodity Price Risk Swap [Line Items] | ||||
Commodity swap fixed price | 23.11 | |||
MGR Assets [Member] | Years 2016 - 2017 [Member] | Propane [Member] | ||||
Commodity Price Risk Swap [Line Items] | ||||
Commodity swap fixed price | 52.90 | |||
MGR Assets [Member] | Years 2016 - 2017 [Member] | Isobutane [Member] | ||||
Commodity Price Risk Swap [Line Items] | ||||
Commodity swap fixed price | 73.89 | |||
MGR Assets [Member] | Years 2016 - 2017 [Member] | Normal butane [Member] | ||||
Commodity Price Risk Swap [Line Items] | ||||
Commodity swap fixed price | 64.93 | |||
MGR Assets [Member] | Years 2016 - 2017 [Member] | Natural gasoline [Member] | ||||
Commodity Price Risk Swap [Line Items] | ||||
Commodity swap fixed price | 81.68 | |||
MGR Assets [Member] | Years 2016 - 2017 [Member] | Condensate [Member] | ||||
Commodity Price Risk Swap [Line Items] | ||||
Commodity swap fixed price | 81.68 | |||
MGR Assets [Member] | Years 2016 - 2017 [Member] | Natural gas (per MMBtu) [Member] | ||||
Commodity Price Risk Swap [Line Items] | ||||
Commodity swap fixed price | $ / MMBTU | 4.87 | |||
MGR Assets [Member] | Year 2017 [Member] | Ethane [Member] | ||||
Commodity Price Risk Swap [Line Items] | ||||
Commodity market price | [2] | 4.08 | ||
MGR Assets [Member] | Year 2017 [Member] | Propane [Member] | ||||
Commodity Price Risk Swap [Line Items] | ||||
Commodity market price | [2] | 19.24 | ||
MGR Assets [Member] | Year 2017 [Member] | Isobutane [Member] | ||||
Commodity Price Risk Swap [Line Items] | ||||
Commodity market price | [2] | 25.79 | ||
MGR Assets [Member] | Year 2017 [Member] | Normal butane [Member] | ||||
Commodity Price Risk Swap [Line Items] | ||||
Commodity market price | [2] | 25.16 | ||
MGR Assets [Member] | Year 2017 [Member] | Natural gasoline [Member] | ||||
Commodity Price Risk Swap [Line Items] | ||||
Commodity market price | [2] | 45.01 | ||
MGR Assets [Member] | Year 2017 [Member] | Condensate [Member] | ||||
Commodity Price Risk Swap [Line Items] | ||||
Commodity market price | [2] | 53.55 | ||
MGR Assets [Member] | Year 2017 [Member] | Natural gas (per MMBtu) [Member] | ||||
Commodity Price Risk Swap [Line Items] | ||||
Commodity market price | $ / MMBTU | [2] | 3.05 | ||
[1] | Represents the New York Mercantile Exchange (“NYMEX”) forward strip price as of December 8, 2015 and December 1, 2016, for the 2016 Market Prices and 2017 Market Prices, respectively, adjusted for product specification, location, basis and, in the case of NGLs, transportation and fractionation costs. | |||
[2] | Represents the NYMEX forward strip price as of December 1, 2016, adjusted for product specification, location, basis and, in the case of NGLs, transportation and fractionation costs. |
Transactions with Affiliates 42
Transactions with Affiliates - Equipment Purchases Table (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | |
Related Party Transaction [Line Items] | |||
Payable to affiliate | $ 186,882 | $ 247,076 | |
Partners’ capital adjustment | 0 | $ 714 | |
Affiliates [Member] | Purchases [Member] | |||
Related Party Transaction [Line Items] | |||
Cash consideration - purchases | 0 | 1,096 | |
Payable to affiliate | 0 | 990 | |
Net carrying value | 0 | (1,372) | |
Partners’ capital adjustment | $ 0 | $ 714 |
Transactions with Affiliates 43
Transactions with Affiliates - Summary of Affiliate Transactions Table (Details) - USD ($) $ in Thousands | Mar. 14, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | |
Related Party Transaction [Line Items] | ||||
Revenues and other | $ 516,193 | $ 383,141 | ||
Equity income, net – affiliates | [1] | 19,461 | 16,814 | |
Cost of product | [2] | 189,359 | 76,467 | |
Operation and maintenance | [2] | 73,760 | 76,213 | |
General and administrative | [2] | 12,659 | 11,277 | |
Operating expenses | 522,516 | 245,920 | ||
Interest income | [3] | 4,225 | 4,225 | |
Interest expense | [4] | 35,504 | 32,036 | |
Proceeds from the issuance of common units, net of offering expenses | (158) | 25,000 | ||
Distributions to unitholders | [5] | 185,565 | 152,588 | |
Above-market component of swap extensions with Anadarko | [5] | $ 12,297 | 6,813 | |
Units issued | 178,977 | |||
Springfield [Member] | Common Units [Member] | ||||
Related Party Transaction [Line Items] | ||||
Units issued | [6] | 2,089,602 | ||
Affiliates [Member] | ||||
Related Party Transaction [Line Items] | ||||
Revenues and other | [1] | $ 315,155 | 272,584 | |
Cost of product | [1] | 15,988 | 24,580 | |
Operation and maintenance | [7] | 17,089 | 17,975 | |
General and administrative | [8] | 9,535 | 8,952 | |
Operating expenses | 42,612 | 51,507 | ||
Interest expense | [9] | 71 | 4,537 | |
Proceeds from the issuance of common units, net of offering expenses | [10] | 0 | 25,000 | |
Distributions to unitholders | [11] | $ 103,123 | $ 89,769 | |
Western Gas Equity Partners, LP [Member] | Springfield [Member] | Common Units [Member] | ||||
Related Party Transaction [Line Items] | ||||
Units issued | 835,841 | |||
[1] | Represents amounts earned or incurred on and subsequent to the date of the acquisition of Partnership assets, as well as amounts earned or incurred by Anadarko on a historical basis related to the Partnership assets prior to the acquisition of such assets, recognized under gathering, treating or processing agreements, and purchase and sale agreements. | |||
[2] | Cost of product includes product purchases from Anadarko (as defined in Note 1) of $16.0 million and $24.6 million for the three months ended March 31, 2017 and 2016, respectively. Operation and maintenance includes charges from Anadarko of $17.1 million and $18.0 million for the three months ended March 31, 2017 and 2016, respectively. General and administrative includes charges from Anadarko of $9.5 million and $9.0 million for the three months ended March 31, 2017 and 2016, respectively. See Note 5. | |||
[3] | Represents interest income recognized on the note receivable from Anadarko. | |||
[4] | Includes affiliate (as defined in Note 1) amounts of $(0.1) million and $(4.5) million for the three months ended March 31, 2017 and 2016, respectively. See Note 2 and Note 9. | |||
[5] | See Note 5. | |||
[6] | The Partnership acquired Springfield Pipeline LLC (“Springfield”) from Anadarko for $750.0 million, consisting of $712.5 million in cash and the issuance of 1,253,761 of the Partnership’s common units. Springfield owns a 50.1% interest in an oil gathering system and a gas gathering system, such interest being referred to in this report as the “Springfield interest.” The Springfield oil and gas gathering systems (collectively, the “Springfield system”) are located in Dimmit, La Salle, Maverick and Webb Counties in South Texas. The Partnership financed the cash portion of the acquisition through: (i) borrowings of $247.5 million on the Partnership’s senior unsecured revolving credit facility (“RCF”), (ii) the issuance of 835,841 of the Partnership’s common units to WGP and (iii) the issuance of Series A Preferred units to private investors. See Note 4 for further information regarding the Series A Preferred units. | |||
[7] | Represents expenses incurred on and subsequent to the date of the acquisition of Partnership assets, as well as expenses incurred by Anadarko on a historical basis related to the Partnership assets prior to the acquisition of such assets. | |||
[8] | Represents general and administrative expense incurred on and subsequent to the date of the Partnership’s acquisition of the Partnership assets, as well as a management services fee for reimbursement of expenses incurred by Anadarko for periods prior to the acquisition of the Partnership assets by the Partnership. These amounts include equity-based compensation expense allocated to the Partnership by Anadarko (see WES LTIP and WGP LTIP and Anadarko Incentive Plan within this Note 5). | |||
[9] | Includes amounts related to the Deferred purchase price obligation - Anadarko (see Note 2 and Note 9). | |||
[10] | Represents proceeds from the issuance of 835,841 common units to WGP as partial funding for the acquisition of Springfield (see Note 2). | |||
[11] | Represents distributions paid under the partnership agreement (see Note 3 and Note 4). |
Transactions with Affiliates 44
Transactions with Affiliates - Additional Information (Details) - USD ($) | 1 Months Ended | 3 Months Ended | |||
May 31, 2008 | Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | ||
Related Party Transaction [Line Items] | |||||
Note receivable - Anadarko | $ 260,000,000 | $ 260,000,000 | |||
Above-market component of swap extensions with Anadarko | [1] | 12,297,000 | |||
Contributions of equity-based compensation from Anadarko | $ 1,119,000 | ||||
Western Gas Partners Long Term Incentive Plan [Member] | |||||
Related Party Transaction [Line Items] | |||||
Units vesting period | 3 years | ||||
Equity-based compensation expense | $ 100,000 | $ 100,000 | |||
Western Gas Equity Partners Long Term Incentive Plan [Member] | Anadarko Incentive Plan [Member] | |||||
Related Party Transaction [Line Items] | |||||
Equity-based compensation expense | 1,200,000 | $ 1,200,000 | |||
Contributions of equity-based compensation from Anadarko | $ 1,119,000 | ||||
Natural Gas [Member] | Gathering, Treating and Transportation [Member] | |||||
Related Party Transaction [Line Items] | |||||
Affiliate throughput percent | 32.00% | 37.00% | |||
Natural Gas [Member] | Processing [Member] | |||||
Related Party Transaction [Line Items] | |||||
Affiliate throughput percent | 49.00% | 61.00% | |||
Crude Oil and NGL [Member] | Gathering, Treating and Transportation [Member] | |||||
Related Party Transaction [Line Items] | |||||
Affiliate throughput percent | 56.00% | 64.00% | |||
Affiliates [Member] | |||||
Related Party Transaction [Line Items] | |||||
Note receivable - Anadarko | $ 260,000,000 | ||||
Note receivable, due date | May 14, 2038 | ||||
Fixed annual rate for note receivable bearing interest | 6.50% | ||||
Affiliates [Member] | Level 2 Inputs [Member] | Market Approach Valuation Technique [Member] | |||||
Related Party Transaction [Line Items] | |||||
Fair value of the note receivable | $ 311,000,000 | $ 313,300,000 | |||
Independent Director [Member] | Western Gas Partners Long Term Incentive Plan [Member] | |||||
Related Party Transaction [Line Items] | |||||
Units vesting period | 1 year | ||||
[1] | See Note 5. |
Property, Plant and Equipment -
Property, Plant and Equipment - Historical Cost Table (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Dec. 31, 2016 | |
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment | $ 7,240,894 | $ 6,861,942 |
Accumulated depreciation | 1,974,081 | 1,812,010 |
Net property, plant and equipment | 5,266,813 | 5,049,932 |
Land [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment | 4,021 | 4,012 |
Gathering Systems and Processing Complexes [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment | $ 6,836,748 | 6,462,053 |
Gathering Systems and Processing Complexes [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life | 3 years | |
Gathering Systems and Processing Complexes [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life | 47 years | |
Pipelines and Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment | $ 139,376 | 139,646 |
Pipelines and Equipment [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life | 15 years | |
Pipelines and Equipment [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life | 45 years | |
Assets Under Construction [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment | $ 230,898 | 226,626 |
Other [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment | $ 29,851 | $ 29,605 |
Other [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life | 3 years | |
Other [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life | 40 years |
Property, Plant and Equipment46
Property, Plant and Equipment - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | |
Property, Plant and Equipment [Line Items] | |||
Impairments | $ 164,742 | $ 6,518 | $ 15,500 |
Granger Complex [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Impairments | 158,800 | ||
Granger Complex [Member] | Fair Value Measurements Nonrecurring [Member] | Level 3 Inputs [Member] | Income Approach Valuation Technique [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Estimated fair value | 48,500 | ||
Equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Impairments | 5,900 | 9,400 | |
Granger Straddle Plant [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Impairments | 3,700 | ||
Granger Straddle Plant [Member] | Fair Value Measurements Nonrecurring [Member] | Level 3 Inputs [Member] | Income Approach Valuation Technique [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Estimated salvage value | $ 600 | ||
Newcastle System [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Impairments | 6,100 | ||
Newcastle System [Member] | Fair Value Measurements Nonrecurring [Member] | Level 3 Inputs [Member] | Income Approach Valuation Technique [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Estimated fair value | $ 3,100 |
Equity Investments - Equity Inv
Equity Investments - Equity Investments Table (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2017 | Mar. 31, 2016 | |||
Schedule of Equity Method Investments [Line Items] | ||||
Balance | $ 594,208 | |||
Investment earnings (loss), net of amortization | [1] | 19,461 | $ 16,814 | |
Distributions | (19,114) | (19,855) | ||
Distributions in excess of cumulative earnings | (3,453) | [2] | $ (4,784) | |
Balance | 591,102 | |||
Fort Union [Member] | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Balance | 12,833 | |||
Investment earnings (loss), net of amortization | 805 | |||
Distributions | (845) | |||
Distributions in excess of cumulative earnings | [2] | 0 | ||
Balance | 12,793 | |||
White Cliffs [Member] | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Balance | 47,319 | |||
Investment earnings (loss), net of amortization | 3,098 | |||
Distributions | (2,952) | |||
Distributions in excess of cumulative earnings | [2] | (615) | ||
Balance | 46,850 | |||
Rendezvous [Member] | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Balance | 46,739 | |||
Investment earnings (loss), net of amortization | 249 | |||
Distributions | (734) | |||
Distributions in excess of cumulative earnings | [2] | (809) | ||
Balance | 45,445 | |||
Mont Belvieu JV [Member] | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Balance | 112,805 | |||
Investment earnings (loss), net of amortization | 6,863 | |||
Distributions | (6,125) | |||
Distributions in excess of cumulative earnings | [2] | 0 | ||
Balance | 113,543 | |||
Texas Express Gathering LLC [Member] | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Balance | 15,846 | |||
Investment earnings (loss), net of amortization | 367 | |||
Distributions | (272) | |||
Distributions in excess of cumulative earnings | [2] | 0 | ||
Balance | 15,941 | |||
Texas Express Pipeline LLC [Member] | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Balance | 189,194 | |||
Investment earnings (loss), net of amortization | 4,276 | |||
Distributions | (4,339) | |||
Distributions in excess of cumulative earnings | [2] | (851) | ||
Balance | 188,280 | |||
Front Range Pipeline LLC [Member] | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Balance | 169,472 | |||
Investment earnings (loss), net of amortization | 3,803 | |||
Distributions | (3,847) | |||
Distributions in excess of cumulative earnings | [2] | (1,178) | ||
Balance | $ 168,250 | |||
[1] | Represents amounts earned or incurred on and subsequent to the date of the acquisition of Partnership assets, as well as amounts earned or incurred by Anadarko on a historical basis related to the Partnership assets prior to the acquisition of such assets, recognized under gathering, treating or processing agreements, and purchase and sale agreements. | |||
[2] | Distributions in excess of cumulative earnings, classified as investing cash flows in the consolidated statements of cash flows, is calculated on an individual investment basis. |
Components of Working Capital -
Components of Working Capital - Accounts Receivable, Net Table (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 | |
Receivables [Abstract] | |||
Trade receivables, net | $ 152,654 | $ 192,808 | |
Other receivables, net | 77 | 30,415 | |
Total accounts receivable, net | [1] | $ 152,731 | $ 223,223 |
[1] | Accounts receivable, net includes amounts receivable from affiliates (as defined in Note 1) of $60.4 million and $76.6 million as of March 31, 2017, and December 31, 2016, respectively. Accounts receivable, net as of December 31, 2016, also includes an insurance claim receivable related to an incident at the DBM complex. See Note 1. |
Components of Working Capital49
Components of Working Capital - Other Current Assets Table (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Other Current Assets [Line Items] | ||
Natural gas liquids inventory | $ 8,348 | $ 7,126 |
Imbalance receivables | 977 | 3,483 |
Prepaid insurance | 1,253 | 2,257 |
Total other current assets | $ 10,578 | $ 12,866 |
Components of Working Capital50
Components of Working Capital - Accrued Liabilities Table (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 | |
Components Of Working Capital [Abstract] | |||
Accrued interest expense | $ 45,574 | $ 39,826 | |
Short-term asset retirement obligations | 6,678 | 3,114 | |
Short-term remediation and reclamation obligations | 630 | 630 | |
Income taxes payable | 1,430 | 1,006 | |
Other accrued liabilities | 3,684 | 532 | |
Total accrued liabilities | [1] | $ 57,996 | $ 45,108 |
[1] | Accrued liabilities includes affiliate amounts of $0.4 million and zero as of March 31, 2017, and December 31, 2016, respectively. |
Debt and Interest Expense - Deb
Debt and Interest Expense - Debt Outstanding Table (Details) - USD ($) | Mar. 31, 2017 | Dec. 31, 2016 | |
Debt Instrument [Line Items] | |||
Total long-term debt principal | $ 3,120,000,000 | $ 3,120,000,000 | |
Carrying value | 3,092,257,000 | 3,091,461,000 | |
Market Approach Valuation Technique [Member] | Level 2 Inputs [Member] | |||
Debt Instrument [Line Items] | |||
Fair value | [1] | 3,200,592,000 | 3,196,199,000 |
Senior Notes [Member] | 5.375% Senior Notes due 2021 [Member] | |||
Debt Instrument [Line Items] | |||
Principal | 500,000,000 | 500,000,000 | |
Carrying value | 494,999,000 | 494,734,000 | |
Senior Notes [Member] | 5.375% Senior Notes due 2021 [Member] | Market Approach Valuation Technique [Member] | Level 2 Inputs [Member] | |||
Debt Instrument [Line Items] | |||
Fair value | [1] | 537,815,000 | 536,252,000 |
Senior Notes [Member] | 4.000% Senior Notes due 2022 [Member] | |||
Debt Instrument [Line Items] | |||
Principal | 670,000,000 | 670,000,000 | |
Carrying value | 668,688,000 | 668,634,000 | |
Senior Notes [Member] | 4.000% Senior Notes due 2022 [Member] | Market Approach Valuation Technique [Member] | Level 2 Inputs [Member] | |||
Debt Instrument [Line Items] | |||
Fair value | [1] | 688,423,000 | 681,723,000 |
Senior Notes [Member] | 2.600% Senior Notes due 2018 [Member] | |||
Debt Instrument [Line Items] | |||
Principal | 350,000,000 | 350,000,000 | |
Carrying value | 349,311,000 | 349,188,000 | |
Senior Notes [Member] | 2.600% Senior Notes due 2018 [Member] | Market Approach Valuation Technique [Member] | Level 2 Inputs [Member] | |||
Debt Instrument [Line Items] | |||
Fair value | [1] | 351,970,000 | 351,531,000 |
Senior Notes [Member] | 5.450% Senior Notes due 2044 [Member] | |||
Debt Instrument [Line Items] | |||
Principal | 600,000,000 | 600,000,000 | |
Carrying value | 593,152,000 | 593,132,000 | |
Senior Notes [Member] | 5.450% Senior Notes due 2044 [Member] | Market Approach Valuation Technique [Member] | Level 2 Inputs [Member] | |||
Debt Instrument [Line Items] | |||
Fair value | [1] | 614,253,000 | 615,753,000 |
Senior Notes [Member] | 3.950% Senior Notes due 2025 [Member] | |||
Debt Instrument [Line Items] | |||
Principal | 500,000,000 | 500,000,000 | |
Carrying value | 491,196,000 | 490,971,000 | |
Senior Notes [Member] | 3.950% Senior Notes due 2025 [Member] | Market Approach Valuation Technique [Member] | Level 2 Inputs [Member] | |||
Debt Instrument [Line Items] | |||
Fair value | [1] | 494,066,000 | 492,499,000 |
Senior Notes [Member] | 4.650% Senior Notes due 2026 [Member] | |||
Debt Instrument [Line Items] | |||
Principal | 500,000,000 | 500,000,000 | |
Carrying value | 494,911,000 | 494,802,000 | |
Senior Notes [Member] | 4.650% Senior Notes due 2026 [Member] | Market Approach Valuation Technique [Member] | Level 2 Inputs [Member] | |||
Debt Instrument [Line Items] | |||
Fair value | [1] | $ 514,065,000 | $ 518,441,000 |
[1] | Fair value is measured using the market approach and Level 2 inputs. |
Debt and Interest Expense - D52
Debt and Interest Expense - Debt Activity Table (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2017USD ($) | |
Debt Instruments [Abstract] | |
Beginning balance | $ 3,091,461 |
Other | 796 |
Ending balance | $ 3,092,257 |
Debt and Interest Expense - Int
Debt and Interest Expense - Interest Expense Table (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | ||
Debt Instrument [Line Items] | |||
Interest expense | [1] | $ (35,504) | $ (32,036) |
Third Parties [Member] | |||
Debt Instrument [Line Items] | |||
Long-term debt | (34,619) | (27,818) | |
Amortization of debt issuance costs and commitment fees | (1,630) | (1,530) | |
Capitalized interest | 816 | 1,849 | |
Interest expense | (35,433) | (27,499) | |
Affiliates [Member] | |||
Debt Instrument [Line Items] | |||
Interest expense | [2] | (71) | (4,537) |
Affiliates [Member] | Deferred Purchase Price Obligation - Anadarko [Member] | |||
Debt Instrument [Line Items] | |||
Deferred purchase price obligation - Anadarko | [3] | $ (71) | $ (4,537) |
[1] | Includes affiliate (as defined in Note 1) amounts of $(0.1) million and $(4.5) million for the three months ended March 31, 2017 and 2016, respectively. See Note 2 and Note 9. | ||
[2] | Includes amounts related to the Deferred purchase price obligation - Anadarko (see Note 2 and Note 9). | ||
[3] | See Note 2 for a discussion of the Deferred purchase price obligation - Anadarko. |
Debt and Interest Expense - Add
Debt and Interest Expense - Additional Information (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Revolving Credit Facility [Member] | ||
Debt Instrument [Line Items] | ||
Facility, outstanding borrowings | $ 0 | |
Outstanding letters of credit | 4,900,000 | |
Facility, available borrowing capacity | $ 1,195,000,000 | |
Facility, interest rate at period end | 2.28% | 1.74% |
Facility, fee rate | 0.20% | 0.20% |
Facility, expiration date | Feb. 26, 2020 | |
Senior Notes [Member] | 5.375% Senior Notes due 2021 [Member] | ||
Debt Instrument [Line Items] | ||
Fixed interest rate | 5.375% | |
Debt instrument, maturity date | Jun. 1, 2021 | |
Senior Notes [Member] | 4.000% Senior Notes due 2022 [Member] | ||
Debt Instrument [Line Items] | ||
Fixed interest rate | 4.00% | |
Debt instrument, maturity date | Jul. 1, 2022 | |
Senior Notes [Member] | 2.600% Senior Notes due 2018 [Member] | ||
Debt Instrument [Line Items] | ||
Fixed interest rate | 2.60% | |
Debt instrument, maturity date | Aug. 15, 2018 | |
Senior Notes [Member] | 5.450% Senior Notes due 2044 [Member] | ||
Debt Instrument [Line Items] | ||
Fixed interest rate | 5.45% | |
Debt instrument, maturity date | Apr. 1, 2044 | |
Senior Notes [Member] | 3.950% Senior Notes due 2025 [Member] | ||
Debt Instrument [Line Items] | ||
Fixed interest rate | 3.95% | |
Debt instrument, maturity date | Jun. 1, 2025 | |
Senior Notes [Member] | 4.650% Senior Notes due 2026 [Member] | ||
Debt Instrument [Line Items] | ||
Fixed interest rate | 4.65% | |
Debt instrument, maturity date | Jul. 1, 2026 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | ||
Committed capital | $ 36.9 | |
Rent expense associated with office, warehouse and equipment leases | $ 7.9 | $ 8.9 |