Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2015 | Jul. 28, 2015 | |
Document And Entity Information [Abstract] | ||
Trading Symbol | WGP | |
Entity Registrant Name | Western Gas Equity Partners, LP | |
Entity Central Index Key | 1,423,902 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2015 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | Q2 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Units Outstanding | 218,913,688 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||||||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |||||
Revenues | ||||||||
Total revenues | $ 402,412 | $ 345,569 | [1] | $ 777,506 | $ 639,286 | [1] | ||
Equity income, net | [2],[3] | 18,941 | 13,008 | [1] | 37,161 | [4] | 22,259 | [1],[4] |
Operating expenses | ||||||||
Cost of product | [5] | 146,293 | 120,542 | [1] | 284,213 | 214,918 | [1] | |
Operation and maintenance | [5] | 56,827 | 55,404 | [1] | 112,976 | 99,981 | [1] | |
General and administrative | [5] | 9,442 | 9,202 | [1] | 20,789 | 19,077 | [1] | |
Property and other taxes | 8,801 | 7,316 | [1] | 17,324 | 14,550 | [1] | ||
Depreciation, amortization and impairments | 65,961 | 45,305 | [1] | 136,253 | 87,390 | [1] | ||
Total operating expenses | 287,324 | 237,769 | [1] | 571,555 | 435,916 | [1] | ||
Operating income | 134,029 | 120,808 | [1] | 243,112 | 225,629 | [1] | ||
Interest income - affiliates | [6] | 4,225 | 4,225 | [1] | 8,450 | 8,450 | [1] | |
Interest expense | [7] | (27,604) | (20,864) | [1] | (50,566) | (34,825) | [1] | |
Other income (expense), net | 80 | 235 | [1] | 160 | 731 | [1] | ||
Income before income taxes | 110,730 | 104,404 | [1] | 201,156 | 199,985 | [1] | ||
Income tax (benefit) expense | (1,816) | 2,523 | [1] | 2,644 | 4,308 | [1] | ||
Net income | 112,546 | 101,881 | [1] | 198,512 | 195,677 | [1] | ||
Net income attributable to noncontrolling interests | 44,751 | 42,492 | [1] | 73,688 | 83,126 | [1] | ||
Net income attributable to Western Gas Equity Partners, LP | 67,795 | 59,389 | [1] | 124,824 | 112,551 | [1] | ||
Limited partners' interest in net income: | ||||||||
Pre-acquisition net (income) loss allocated to Anadarko | 0 | (4,135) | [1] | (1,742) | (6,800) | [1] | ||
Limited partners' interest in net income | [8] | 67,795 | 55,254 | [1] | 123,082 | 105,751 | [1] | |
Affiliates [Member] | ||||||||
Revenues | ||||||||
Gathering, processing and transportation of natural gas and natural gas liquids | 138,644 | 107,874 | [1] | 266,953 | 200,557 | [1] | ||
Natural gas, natural gas liquids and drip condensate sales | 120,672 | 157,806 | [1] | 237,908 | 279,391 | [1] | ||
Other | 132 | 843 | [1] | 302 | 1,571 | [1] | ||
Total revenues | [3] | 259,448 | 266,523 | [1] | 505,163 | 481,519 | [1] | |
Operating expenses | ||||||||
Cost of product | [3] | 52,139 | 36,890 | 94,546 | 55,246 | |||
Operation and maintenance | [9] | 17,496 | 16,827 | 32,872 | 29,378 | |||
General and administrative | [10] | 7,513 | 7,090 | 15,279 | 14,572 | |||
Total operating expenses | 77,148 | 60,807 | 142,697 | 99,196 | ||||
Interest expense | [11] | (4,190) | 0 | (5,612) | 0 | |||
Third Parties [Member] | ||||||||
Revenues | ||||||||
Gathering, processing and transportation of natural gas and natural gas liquids | 89,592 | 68,011 | [1] | 171,127 | 129,825 | [1] | ||
Natural gas, natural gas liquids and drip condensate sales | 52,589 | 9,822 | [1] | 99,521 | 25,886 | [1] | ||
Other | 783 | 1,213 | [1] | 1,695 | 2,056 | [1] | ||
Total revenues | 142,964 | 79,046 | [1] | 272,343 | 157,767 | [1] | ||
Operating expenses | ||||||||
Interest expense | $ (23,414) | $ (20,864) | $ (44,954) | $ (34,825) | ||||
Limited Partner [Member] | ||||||||
Limited partners' interest in net income: | ||||||||
Net income per common unit - basic and diluted | $ 0.31 | $ 0.25 | [1] | $ 0.56 | $ 0.48 | [1] | ||
Weighted-average common units outstanding - basic and diluted | 218,912 | 218,903 | [1] | 218,911 | 218,903 | [1] | ||
[1] | Financial information has been recast to include the financial position and results attributable to the DBJV system. See Note 1 and Note 2. | |||||||
[2] | Income earned from equity investments is classified as affiliate. See Note 1. | |||||||
[3] | Represents amounts earned or incurred on and subsequent to the date of acquisition of WES assets, as well as amounts earned or incurred by Anadarko on a historical basis related to WES assets prior to the acquisition of such assets by WES, recognized under gathering, treating or processing agreements, and purchase and sale agreements. | |||||||
[4] | Income earned on, distributions from and contributions to equity investments are classified as affiliate. See Note 1. | |||||||
[5] | Cost of product includes product purchases from Anadarko (as defined in Note 1) of $52.1 million and $94.5 million for the three and six months ended June 30, 2015, respectively, and $36.9 million and $55.2 million for the three and six months ended June 30, 2014, respectively. Operation and maintenance includes charges from Anadarko of $17.5 million and $32.9 million for the three and six months ended June 30, 2015, respectively, and $16.8 million and $29.4 million for the three and six months ended June 30, 2014, respectively. General and administrative includes charges from Anadarko of $7.5 million and $15.3 million for the three and six months ended June 30, 2015, respectively, and $7.1 million and $14.6 million for the three and six months ended June 30, 2014, respectively. See Note 5. | |||||||
[6] | Represents interest income recognized on the note receivable from Anadarko. | |||||||
[7] | Includes affiliate (as defined in Note 1) interest expense of $4.2 million and $5.6 million for the three and six months ended June 30, 2015, respectively, and zero for each of the three and six months ended June 30, 2014. See Note 2 and Note 9. | |||||||
[8] | Represents net income earned on and subsequent to the date of acquisition of WES assets (as defined in Note 1). See Note 4. | |||||||
[9] | Represents expenses incurred on and subsequent to the date of the acquisition of WES assets, as well as expenses incurred by Anadarko on a historical basis related to WES assets prior to the acquisition of such assets by WES. | |||||||
[10] | Represents general and administrative expense incurred on and subsequent to the date of WES’s acquisition of WES assets, as well as a management services fee for reimbursement of expenses incurred by Anadarko for periods prior to the acquisition of WES assets by WES. These amounts include equity-based compensation expense allocated to WES and WGP by Anadarko (see WES LTIP and WGP LTIP and Anadarko Incentive Plans within this Note 5) and amounts charged by Anadarko under the WGP omnibus agreement. | |||||||
[11] | For the three and six months ended June 30, 2015, includes interest expense recognized on the WGP working capital facility (see Note 9) and WES’s accretion expense recognized on the Deferred purchase price obligation - Anadarko for the acquisition of DBJV (see Note 2 and Note 9). |
Consolidated Statements of Inc3
Consolidated Statements of Income (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | ||||
Cost of product | [1] | $ 146,293 | $ 120,542 | [2] | $ 284,213 | $ 214,918 | [2] |
Operation and maintenance | [1] | 56,827 | 55,404 | [2] | 112,976 | 99,981 | [2] |
General and administrative | [1] | 9,442 | 9,202 | [2] | 20,789 | 19,077 | [2] |
Interest expense | [3] | 27,604 | 20,864 | [2] | 50,566 | 34,825 | [2] |
Affiliates [Member] | |||||||
Cost of product | [4] | 52,139 | 36,890 | 94,546 | 55,246 | ||
Operation and maintenance | [5] | 17,496 | 16,827 | 32,872 | 29,378 | ||
General and administrative | [6] | 7,513 | 7,090 | 15,279 | 14,572 | ||
Interest expense | [7] | $ 4,190 | $ 0 | $ 5,612 | $ 0 | ||
[1] | Cost of product includes product purchases from Anadarko (as defined in Note 1) of $52.1 million and $94.5 million for the three and six months ended June 30, 2015, respectively, and $36.9 million and $55.2 million for the three and six months ended June 30, 2014, respectively. Operation and maintenance includes charges from Anadarko of $17.5 million and $32.9 million for the three and six months ended June 30, 2015, respectively, and $16.8 million and $29.4 million for the three and six months ended June 30, 2014, respectively. General and administrative includes charges from Anadarko of $7.5 million and $15.3 million for the three and six months ended June 30, 2015, respectively, and $7.1 million and $14.6 million for the three and six months ended June 30, 2014, respectively. See Note 5. | ||||||
[2] | Financial information has been recast to include the financial position and results attributable to the DBJV system. See Note 1 and Note 2. | ||||||
[3] | Includes affiliate (as defined in Note 1) interest expense of $4.2 million and $5.6 million for the three and six months ended June 30, 2015, respectively, and zero for each of the three and six months ended June 30, 2014. See Note 2 and Note 9. | ||||||
[4] | Represents amounts earned or incurred on and subsequent to the date of acquisition of WES assets, as well as amounts earned or incurred by Anadarko on a historical basis related to WES assets prior to the acquisition of such assets by WES, recognized under gathering, treating or processing agreements, and purchase and sale agreements. | ||||||
[5] | Represents expenses incurred on and subsequent to the date of the acquisition of WES assets, as well as expenses incurred by Anadarko on a historical basis related to WES assets prior to the acquisition of such assets by WES. | ||||||
[6] | Represents general and administrative expense incurred on and subsequent to the date of WES’s acquisition of WES assets, as well as a management services fee for reimbursement of expenses incurred by Anadarko for periods prior to the acquisition of WES assets by WES. These amounts include equity-based compensation expense allocated to WES and WGP by Anadarko (see WES LTIP and WGP LTIP and Anadarko Incentive Plans within this Note 5) and amounts charged by Anadarko under the WGP omnibus agreement. | ||||||
[7] | For the three and six months ended June 30, 2015, includes interest expense recognized on the WGP working capital facility (see Note 9) and WES’s accretion expense recognized on the Deferred purchase price obligation - Anadarko for the acquisition of DBJV (see Note 2 and Note 9). |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2015 | Dec. 31, 2014 | [1] | |
Current assets | ||||
Cash and cash equivalents | $ 89,262 | $ 67,213 | ||
Accounts receivable, net | [2] | 172,427 | 109,019 | |
Other current assets | [3] | 12,023 | 10,841 | |
Total current assets | 273,712 | 187,073 | ||
Note receivable - Anadarko | 260,000 | 260,000 | ||
Property, plant and equipment | ||||
Cost | 5,948,148 | 5,626,650 | ||
Less accumulated depreciation | 1,165,607 | 1,055,207 | ||
Net property, plant and equipment | 4,782,541 | 4,571,443 | ||
Goodwill | 393,035 | 389,087 | ||
Other intangible assets | 846,342 | 884,857 | ||
Equity investments | 630,851 | 634,492 | ||
Other assets | 31,172 | 28,289 | ||
Total assets | 7,217,653 | 6,955,241 | ||
Current liabilities | ||||
Accounts and natural gas imbalance payables | [4] | 45,376 | 54,232 | |
Accrued ad valorem taxes | 18,098 | 14,812 | ||
Accrued liabilities | 149,669 | 170,864 | ||
Total current liabilities | 213,143 | 241,058 | ||
Long-term debt | 2,677,023 | 2,422,954 | ||
Deferred income taxes | 5,869 | 45,656 | ||
Asset retirement obligations and other | 120,041 | 111,714 | ||
Deferred purchase price obligation - Anadarko | [5] | 179,886 | 0 | |
Total long-term liabilities | 2,982,819 | 2,580,324 | ||
Total liabilities | 3,195,962 | 2,821,382 | ||
Equity and partners' capital | ||||
Common units (218,913,688 and 218,909,977 units issued and outstanding at June 30, 2015, and December 31, 2014, respectively) | 1,244,765 | 1,260,195 | ||
Net investment by Anadarko | 0 | 122,509 | ||
Total partners' capital | 1,244,765 | 1,382,704 | ||
Noncontrolling interests | 2,776,926 | 2,751,155 | ||
Total equity and partners' capital | 4,021,691 | 4,133,859 | ||
Total liabilities, equity and partners' capital | 7,217,653 | 6,955,241 | ||
Anadarko [Member] | ||||
Current liabilities | ||||
WGP working capital facility - Anadarko | $ 0 | $ 1,150 | ||
[1] | Financial information has been recast to include the financial position and results attributable to the DBJV system. See Note 1 and Note 2. | |||
[2] | Accounts receivable, net includes amounts receivable from affiliates (as defined in Note 1) of $74.2 million and $64.5 million as of June 30, 2015, and December 31, 2014, respectively. | |||
[3] | Other current assets includes natural gas imbalance receivables from affiliates of zero and $0.2 million as of June 30, 2015, and December 31, 2014, respectively. | |||
[4] | Accounts and natural gas imbalance payables includes amounts payable to affiliates of zero and $0.1 million as of June 30, 2015, and December 31, 2014, respectively. | |||
[5] | See Note 2. |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2015 | Dec. 31, 2014 | ||
Common units issued | 218,913,688 | 218,909,977 | ||
Common units outstanding | 218,913,688 | 218,909,977 | ||
Accounts receivable, net | [1] | $ 172,427 | $ 109,019 | [2] |
Other current assets | [3] | 12,023 | 10,841 | [2] |
Accounts and natural gas imbalance payables | [4] | 45,376 | 54,232 | [2] |
Affiliates [Member] | ||||
Accounts receivable, net | 74,200 | 64,500 | ||
Other current assets | 0 | 200 | ||
Accounts and natural gas imbalance payables | $ 0 | $ 100 | ||
[1] | Accounts receivable, net includes amounts receivable from affiliates (as defined in Note 1) of $74.2 million and $64.5 million as of June 30, 2015, and December 31, 2014, respectively. | |||
[2] | Financial information has been recast to include the financial position and results attributable to the DBJV system. See Note 1 and Note 2. | |||
[3] | Other current assets includes natural gas imbalance receivables from affiliates of zero and $0.2 million as of June 30, 2015, and December 31, 2014, respectively. | |||
[4] | Accounts and natural gas imbalance payables includes amounts payable to affiliates of zero and $0.1 million as of June 30, 2015, and December 31, 2014, respectively. |
Consolidated Statement of Equit
Consolidated Statement of Equity and Partners' Capital - 6 months ended Jun. 30, 2015 - USD ($) $ in Thousands | Total | Western Gas Partners, LP [Member] | Chipeta Processing LLC [Member] | Net Investment by Anadarko [Member] | Common Units [Member] | Noncontrolling Interests [Member] | Noncontrolling Interests [Member]Western Gas Partners, LP [Member] | Noncontrolling Interests [Member]Chipeta Processing LLC [Member] | |
Balance at Dec. 31, 2014 | [1] | $ 4,133,859 | $ 122,509 | $ 1,260,195 | $ 2,751,155 | ||||
Net income (loss) | 198,512 | 1,742 | 123,082 | 73,688 | |||||
WES equity transactions, net | [2] | 57,376 | (13,795) | 71,171 | |||||
Distributions to noncontrolling interest owners | $ (112,278) | $ (7,175) | $ (112,278) | $ (7,175) | |||||
Distributions to WGP unitholders | (143,386) | (143,386) | |||||||
Acquisitions from affiliates | (174,276) | (196,191) | 21,915 | ||||||
Contributions of equity-based compensation to WES by Anadarko | 1,707 | 1,707 | |||||||
Net pre-acquisition contributions from (distributions to) Anadarko | 30,096 | 30,096 | |||||||
Net distributions to Anadarko of other assets | (4,726) | (4,726) | |||||||
Elimination of net deferred tax liabilities | 41,844 | 41,844 | |||||||
Other | 138 | (227) | 365 | ||||||
Balance at Jun. 30, 2015 | $ 4,021,691 | $ 0 | $ 1,244,765 | $ 2,776,926 | |||||
[1] | Financial information has been recast to include the financial position and results attributable to the DBJV system. See Note 1 and Note 2. | ||||||||
[2] | Includes the impact of Western Gas Partners, LP’s public equity offerings as described in Note 4. The $13.8 million decrease to partners’ capital, together with net income attributable to Western Gas Equity Partners, LP, totaled $111.0 million for the six months ended June 30, 2015. |
Consolidated Statement of Equi7
Consolidated Statement of Equity and Partners' Capital (Parenthetical) $ in Thousands | 6 Months Ended | |
Jun. 30, 2015USD ($) | ||
WES equity transactions, net | [1] | $ (57,376) |
Combined change in Partners' Capital from WES equity transactions, net and net income attributable to Western Gas Equity Partners, LP | 111,000 | |
Common Units [Member] | ||
WES equity transactions, net | [1] | $ 13,795 |
[1] | Includes the impact of Western Gas Partners, LP’s public equity offerings as described in Note 4. The $13.8 million decrease to partners’ capital, together with net income attributable to Western Gas Equity Partners, LP, totaled $111.0 million for the six months ended June 30, 2015. |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 6 Months Ended | ||||
Jun. 30, 2015 | Jun. 30, 2014 | ||||
Cash flows from operating activities | |||||
Net income | $ 198,512 | $ 195,677 | [1] | ||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||
Depreciation, amortization and impairments | 136,253 | 87,390 | [1] | ||
Non-cash equity-based compensation expense | 2,262 | 2,247 | [1] | ||
Deferred income taxes | 1,825 | 2,218 | [1] | ||
Accretion and amortization of long-term obligations, net | 7,070 | 1,358 | [1] | ||
Equity income, net | [2],[3],[4] | (37,161) | (22,259) | [1] | |
Distributions from equity investment earnings | [3] | 39,034 | 26,793 | [1] | |
Changes in assets and liabilities: | |||||
(Increase) decrease in accounts receivable, net | (46,170) | (23,772) | [1] | ||
Increase (decrease) in accounts and natural gas imbalance payables and accrued liabilities, net | 287 | 3,320 | [1] | ||
Change in other items, net | (1,543) | 4,670 | [1] | ||
Net cash provided by operating activities | 300,369 | 277,642 | [1] | ||
Cash flows from investing activities | |||||
Capital expenditures | (338,178) | (390,506) | [1] | ||
Investments in equity affiliates | (6,770) | (60,102) | [1] | ||
Distributions from equity investments in excess of cumulative earnings | [3] | 8,538 | [5] | 9,848 | [1] |
Net cash used in investing activities | (349,170) | (801,530) | [1] | ||
Cash flows from financing activities | |||||
Borrowings, net of debt issuance costs | 769,694 | 1,076,895 | [1] | ||
Repayments of debt | (521,150) | (480,000) | [1] | ||
Increase (decrease) in outstanding checks | (2,327) | 2,517 | [1] | ||
Distributions to WGP unitholders | (143,386) | (105,347) | [1] | ||
Net contributions from Anadarko | 30,096 | 39,033 | [1] | ||
Net cash provided by financing activities | 70,850 | 532,945 | [1] | ||
Net increase (decrease) in cash and cash equivalents | 22,049 | 9,057 | [1] | ||
Cash and cash equivalents at beginning of period | 67,213 | [6] | 113,085 | [1] | |
Cash and cash equivalents at end of period | 89,262 | 122,142 | [1] | ||
Supplemental disclosures | |||||
Net distributions to (contributions from) Anadarko of other assets | 4,726 | (43) | [1] | ||
Interest paid, net of capitalized interest | 42,167 | 26,346 | [1] | ||
Taxes paid (reimbursements received) | (138) | (340) | [1] | ||
Capital lease asset transfer | [7] | 0 | 4,833 | [1] | |
Western Gas Partners, LP [Member] | |||||
Cash flows from financing activities | |||||
Proceeds from the issuance of WES common units, net of offering expenses | 57,376 | 91,690 | [1] | ||
Distributions to noncontrolling interest owners of WES | (112,278) | (83,894) | [1] | ||
Delaware Basin JV Gathering LLC [Member] | |||||
Cash flows from operating activities | |||||
Net income | 7,756 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||
Equity income, net | 0 | ||||
Supplemental disclosures | |||||
Acquisition of DBJV from Anadarko | [8] | 174,276 | 0 | [1] | |
Chipeta Processing LLC [Member] | |||||
Cash flows from financing activities | |||||
Distributions to Chipeta noncontrolling interest owners | (7,175) | (7,949) | [1] | ||
Affiliates [Member] | |||||
Cash flows from investing activities | |||||
Contributions in aid of construction costs from affiliates | 0 | 182 | [1] | ||
Acquisitions | (9,968) | (360,952) | [1] | ||
Proceeds from the sale of assets | 700 | 0 | [1] | ||
Affiliates [Member] | Western Gas Partners, LP [Member] | |||||
Cash flows from financing activities | |||||
Distributions to WGP unitholders | [9] | (1,080) | (743) | ||
Third Parties [Member] | |||||
Cash flows from investing activities | |||||
Acquisitions | (3,514) | 0 | [1] | ||
Proceeds from the sale of assets | $ 22 | $ 0 | [1] | ||
[1] | Financial information has been recast to include the financial position and results attributable to the DBJV system. See Note 1 and Note 2. | ||||
[2] | Income earned from equity investments is classified as affiliate. See Note 1. | ||||
[3] | Income earned on, distributions from and contributions to equity investments are classified as affiliate. See Note 1. | ||||
[4] | Represents amounts earned or incurred on and subsequent to the date of acquisition of WES assets, as well as amounts earned or incurred by Anadarko on a historical basis related to WES assets prior to the acquisition of such assets by WES, recognized under gathering, treating or processing agreements, and purchase and sale agreements. | ||||
[5] | 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. | ||||
[6] | Financial information has been recast to include the financial position and results attributable to the DBJV system. See Note 1 and Note 2. | ||||
[7] | For the six months ended June 30, 2014, represents transfers of $4.6 million from other long-term assets associated with the capital lease component of a processing agreement. | ||||
[8] | See Note 2. | ||||
[9] | Represents distributions paid to other subsidiaries of Anadarko under WES’s partnership agreement (see Note 3 and Note 4). |
Consolidated Statements of Cas9
Consolidated Statements of Cash Flows (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2014 |
Natural Gas Processing Plant [Member] | |
Property, plant and equipment | $ 4,600 |
Description of Business and Bas
Description of Business and Basis of Presentation | 6 Months Ended |
Jun. 30, 2015 | |
Accounting Policies [Abstract] | |
Description of Business and Basis of Presentation | 1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION General. Western Gas Equity Partners, LP is a Delaware master limited partnership formed in September 2012 to own three types of partnership interests in Western Gas Partners, LP. Western Gas Equity Partners, LP was formed by converting WGR Holdings, LLC into a limited partnership and changing its name. Western Gas Partners, LP (together with its subsidiaries, “WES”) is a Delaware master limited partnership formed by Anadarko Petroleum Corporation in 2007 to acquire, own, develop and operate midstream energy assets. For purposes of these consolidated financial statements, “WGP” refers to Western Gas Equity Partners, LP in its individual capacity or to Western Gas Equity Partners, LP and its subsidiaries, including Western Gas Holdings, LLC and WES, as the context requires. “WES GP” refers to Western Gas Holdings, LLC, individually as the general partner of WES, and excludes WES. WGP’s general partner, Western Gas Equity Holdings, LLC (“WGP GP”), is a wholly owned subsidiary of Anadarko Petroleum Corporation. “Anadarko” refers to Anadarko Petroleum Corporation and its subsidiaries, excluding WGP and WGP GP, and “affiliates” refers to subsidiaries of Anadarko, excluding WGP, and includes 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.” “Equity investment throughput” refers to WES’s 14.81% share of average Fort Union throughput and 22% share of average Rendezvous throughput, but excludes throughput measured in barrels, consisting of WES’s 10% share of average White Cliffs throughput, 25% share of average Mont Belvieu JV throughput, 20% share of average TEP and TEG throughput and 33.33% share of average FRP throughput. The “DJ Basin complex” refers to the Platte Valley system, Wattenberg system and Lancaster plant, all of which were combined into a single complex in the first quarter of 2014. The “MGR assets” include the Red Desert complex, the Granger straddle plant and the 22% interest in Rendezvous. The three types of partnership interests in WES owned by WGP are as follows: (i) the general partner interest in WES, held through WES GP; (ii) 100% of the incentive distribution rights (“IDRs”) in WES, which entitle WGP to receive increasing percentages, up to the maximum level of 48.0% , of any incremental cash distributed by WES as certain target distribution levels are reached in any quarter; and (iii) a significant limited partner interest in WES. WES GP owns all of the general partner interest in WES, which constitutes substantially all of its business, which primarily is to manage the affairs and operations of WES. Refer to Note 4 for a discussion of WGP’s holdings of WES equity. WES is engaged in the business of gathering, processing, compressing, treating and transporting natural gas, condensate, NGLs and crude oil for Anadarko, as well as for third-party producers and customers. As of June 30, 2015 , WES’s assets and investments accounted for under the equity method consisted of the following: Owned and Operated Operated Interests Non-Operated Interests Equity Interests Natural gas gathering systems 14 2 5 2 Natural gas treating facilities 10 5 — 1 Natural gas processing facilities 14 5 — 2 NGL pipelines 3 — — 3 Natural gas pipelines 4 — — — Oil pipelines 1 — — 1 These assets and investments are located in the Rocky Mountains (Colorado, Utah and Wyoming), the Mid-Continent (Kansas and Oklahoma), North-central Pennsylvania and Texas. In June 2015, WES completed the construction and commenced operations of Lancaster Train II, a processing plant located in the DJ Basin complex. In addition, WES is constructing Trains IV and V, both processing plants, at the DBM complex (see Note 2 ), with operations expected to commence during the first and second halves of 2016, respectively. 1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION (CONTINUED) Basis of presentation. 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 WGP and entities in which it holds a controlling financial interest, including WES and WES GP. All significant intercompany transactions have been eliminated. Investments in non-controlled entities over which WES, or WGP through its investment in WES, exercises significant influence are accounted for under the equity method. WGP proportionately consolidates WES’s 33.75% share of the assets, liabilities, revenues and expenses attributable to the Non-Operated Marcellus Interest systems and Anadarko-Operated Marcellus Interest systems and WES’s 50% share of the assets, liabilities, revenues and expenses attributable to the Newcastle system and the DBJV system (see Note 2 ) in the accompanying consolidated financial statements. The consolidated financial results of WES are included in WGP’s consolidated financial statements due to WGP’s 100% ownership interest in WES GP and WES GP’s control of WES. Throughout these notes to consolidated financial statements, and to the extent material, any differences between the consolidated financial results of WGP and WES are discussed separately. WGP has no independent operations or material assets other than its partnership interests in WES. WGP’s consolidated financial statements differ from those of WES primarily as a result of (i) the presentation of noncontrolling interest ownership (attributable to the limited partner interests in WES held by the public and other subsidiaries of Anadarko), (ii) the elimination of WES GP’s investment in WES with WES GP’s underlying capital account, and (iii) the general and administrative expenses incurred by WGP, which are separate from, and in addition to, those incurred by WES. 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. 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 WGP’s 2014 Form 10-K, as filed with the SEC on February 26, 2015. Management believes that the disclosures made are adequate to make the information not misleading. Noncontrolling interests. WGP’s noncontrolling interests in the consolidated financial statements consist of the following for all periods presented: (i) the interest in Chipeta Processing LLC (“Chipeta”) held by a third-party member, (ii) the publicly held limited partner interests in WES, (iii) the 757,619 WES common units issued by WES to other subsidiaries of Anadarko as part of the consideration paid for the acquisitions of the Non-Operated Marcellus Interest and the TEFR Interests, and (iv) the WES Class C units issued by WES to a subsidiary of Anadarko as part of the funding for the acquisition of DBM. See Note 3 and Note 4 . The difference between the carrying value of WGP’s investment in WES and the underlying book value of common units issued by WES is accounted for as an equity transaction. Thus, if WES issues common units at a price different than WGP’s per-unit carrying value, any resulting change in the carrying value of WGP’s investment in WES is reflected as an adjustment to partners’ capital. 1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION (CONTINUED) Presentation of WES assets. The term “WES assets” refers to the assets indirectly owned and interests accounted for under the equity method (see Note 7 ) by WGP through its partnership interests in WES as of June 30, 2015 . Because WGP owns the entire interest in and controls WES GP, and WGP GP is owned and controlled by Anadarko, each of WES’s acquisitions of WES assets from Anadarko has been considered a transfer of net assets between entities under common control. As such, WES assets acquired from Anadarko were initially recorded at Anadarko’s historic carrying value, which did not correlate to the total acquisition price paid by WES. Further, after an acquisition of WES assets from Anadarko, WES and WGP (by virtue of its consolidation of WES) may be required to recast their financial statements to include the activities of such WES assets from the date of common control. See Note 2 . For those periods requiring recast, the consolidated financial statements for periods prior to the acquisition of WES assets from Anadarko have been 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 WES had owned the WES assets during the periods reported. Net income attributable to the WES assets acquired from Anadarko for periods prior to WES’s acquisition of the WES assets is not allocated to the limited partners. Recently issued accounting standards . The Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2015-06, Earnings Per Share (Topic - 260)—Effects on Historical Earnings per Unit of Master Limited Partnership Dropdown Transactions . This ASU contains guidance that addresses the historical earnings per unit presentation for master limited partnerships that apply the two-class method of calculating earnings per unit. When a general partner transfers or “drops down” net assets to a master limited partnership the transaction is accounted for as a transaction between entities under common control and the statements of operations are adjusted retrospectively to reflect the transaction. This ASU specifies that the historical earnings (losses) of a transferred business before the date of a dropdown transaction should be allocated entirely to the general partner, and the previously reported earnings per unit of the limited partners should not change as a result of the dropdown transaction. The ASU also requires additional disclosures about how the rights to the earnings (losses) differ before and after the dropdown transaction occurs for purposes of computing earnings per unit under the two-class method. This ASU is effective for annual and interim periods beginning in 2016 and is required to be adopted using a retrospective approach, with early adoption permitted. While WGP believes it is currently in compliance with this ASU, it continues to evaluate the impact of the adoption of this ASU on its consolidated financial statements. The FASB issued ASU 2015-03, Interest—Imputation of Interest (Subtopic 853-30)—Simplifying the Presentation of Debt Issuance Costs . This ASU will simplify the presentation of debt issuance costs by requiring such costs to be presented in the balance sheet as a reduction from the corresponding debt liability rather than as an asset. This ASU is effective for annual and interim periods beginning in 2016 and is required to be adopted using a retrospective approach, with early adoption permitted. WGP does not expect the adoption to have a material impact on its consolidated financial statements. The FASB issued ASU 2015-02, Consolidation—Amendments to the Consolidation Analysis . This ASU will simplify existing requirements by reducing the number of consolidation models and placing more emphasis on risk of loss when determining a controlling financial interest. The provisions will affect how limited partnerships and similar entities are assessed for consolidation, including the elimination of the presumption that a general partner should consolidate a limited partnership. This ASU is effective for annual and interim periods beginning in 2016 and is required to be adopted using a retrospective or modified retrospective approach, with early adoption permitted. WGP is evaluating the impact of the adoption of this ASU on its consolidated financial statements. The FASB issued ASU 2014-09, Revenue from Contracts with Customers . This ASU supersedes the revenue recognition requirements in Topic 605, Revenue Recognition , and industry-specific guidance in Subtopic 932-605, Extractive Activities—Oil and Gas—Revenue Recognition , 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. This ASU is effective for annual and interim periods beginning in 2018 and is required to be adopted using one of two retrospective application methods, with early adoption permitted in 2017. WGP is evaluating the impact of the adoption of this ASU on its consolidated financial statements. |
Acquisitions and Divestitures
Acquisitions and Divestitures | 6 Months Ended |
Jun. 30, 2015 | |
Property, Plant and Equipment [Abstract] | |
Acquisitions and Divestitures | 2. ACQUISITIONS AND DIVESTITURES The following table presents the acquisitions completed by WES during 2015 and 2014 , and identifies the funding sources for such acquisitions: thousands except unit and percent amounts Acquisition Date Percentage Deferred Purchase Price Obligation - Anadarko Borrowings Cash On Hand WES Common Units Issued to Anadarko WES Class C Units Issued to Anadarko TEFR Interests (1) 03/03/2014 Various (1) $ — $ 350,000 $ 6,250 308,490 — DBM (2) 11/25/2014 100 % — 475,000 298,327 — 10,913,853 DBJV system (3) 03/02/2015 50 % 174,276 — — — — (1) WES acquired a 20% interest in each of TEG and TEP and a 33.33% interest in FRP from Anadarko. These assets gather and transport NGLs primarily from the Anadarko and Denver-Julesburg (“DJ”) Basins. The interests in these entities are accounted for under the equity method of accounting. In connection with the issuance of WES common units, WES GP purchased 6,296 general partner units in exchange for WES GP’s proportionate capital contribution of $0.4 million . (2) WES acquired Nuevo Midstream, LLC (“Nuevo”) from a third party. Following the acquisition, WES changed the name of Nuevo to Delaware Basin Midstream, LLC (“DBM”). The assets acquired include cryogenic processing plants, a gas gathering system, and related facilities and equipment, which are collectively referred to as the “DBM complex” and serve production from Reeves, Loving and Culberson Counties, Texas and Eddy and Lea Counties, New Mexico. See DBM acquisition below for further information, including the preliminary allocation of the purchase price. (3) WES acquired Anadarko’s interest in Delaware Basin JV Gathering LLC (“DBJV”), which owns a 50% interest in a gathering system and related facilities (the “DBJV system”). The DBJV system is located in the Delaware Basin in Loving, Ward, Winkler and Reeves Counties, Texas. WES will make a cash payment on March 31, 2020, to Anadarko as consideration for the acquisition of DBJV. WES currently estimates the future payment will be $282.8 million , the net present value of which was $174.3 million as of the acquisition date. See DBJV acquisition—Deferred purchase price obligation - Anadarko below. DBJV acquisition . Because the acquisition of DBJV was a transfer of net assets between entities under common control, WGP’s historical financial statements previously filed with the SEC have been recast in this Form 10-Q to include the results attributable to the DBJV system as if WES owned DBJV for all periods presented. The consolidated financial statements for periods prior to WES’s acquisition of DBJV have been 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 WES had owned DBJV during the periods reported. The following table presents the impact of the DBJV system on revenue, equity income, net and net income as presented in WGP’s historical consolidated statements of income: Three Months Ended June 30, 2014 thousands WGP Historical DBJV System Combined Revenues $ 329,944 $ 15,625 $ 345,569 Equity income, net 13,008 — 13,008 Net income 97,746 4,135 101,881 Six Months Ended June 30, 2014 thousands WGP Historical DBJV System Combined Revenues $ 609,401 $ 29,885 $ 639,286 Equity income, net 22,259 — 22,259 Net income 187,921 7,756 195,677 2. ACQUISITIONS AND DIVESTITURES (CONTINUED) Deferred purchase price obligation - Anadarko. The consideration to be paid by WES for the acquisition of DBJV consists of a cash payment to Anadarko due on March 31, 2020. The cash payment will be equal to eight multiplied by (a) the average of WES’s share in the Net Earnings (see definition below) of the DBJV system for the calendar years 2018 and 2019, less (b) WES’s share of all capital expenditures incurred for the DBJV system 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 the DBJV system on an accrual basis. As of the acquisition date, the estimated future payment obligation was $282.8 million , which had a net present value of $174.3 million , using a discount rate of 10% . As of June 30, 2015 , the net present value of this obligation was $179.9 million and has been recorded on the consolidated balance sheet under Deferred purchase price obligation - Anadarko. Accretion expense for the three and six months ended June 30, 2015 , was $4.2 million and $5.6 million , respectively, and has been recorded as a charge to interest expense. The fair value measurement was calculated using Level 3 inputs, which consisted of management’s estimate of WES’s share of forecasted Net Earnings and capital expenditures for the DBJV system. DBM acquisition . The DBM acquisition has been accounted for under the acquisition method of accounting. The assets acquired and liabilities assumed in the DBM acquisition were recorded in the consolidated balance sheet at their estimated fair values as of the acquisition date. Results of operations attributable to the DBM acquisition were included in the consolidated statement of income beginning on the acquisition date in the fourth quarter of 2014. The following is the preliminary allocation of the purchase price as of June 30, 2015 , including $3.5 million of post-closing purchase price adjustments, to the assets acquired and liabilities assumed in the DBM acquisition as of the acquisition date, pending final review of certain support related to the acquired entity’s assets and liabilities: thousands Current assets $ 63,020 Property, plant and equipment 467,171 Goodwill 282,999 Other intangible assets 811,048 Accounts payables (17,679 ) Accrued liabilities (38,684 ) Deferred income taxes (1,342 ) Asset retirement obligations and other (9,060 ) Total purchase price $ 1,557,473 The purchase price allocation is based on an assessment of the fair value of the assets acquired and liabilities assumed in the DBM acquisition using inputs that are not observable in the market and thus represent Level 3 inputs. The fair values of the processing plants, gathering system, and related facilities and equipment are based on market and cost approaches. The fair value of the intangible assets was determined using an income approach. Deferred taxes represent the tax effects of differences in the tax basis and acquisition-date fair value of the assets acquired and liabilities assumed. Assets held for sale - Dew and Pinnacle systems. During the second quarter of 2015, the Dew and Pinnacle systems in East Texas satisfied criteria to be considered held for sale. At June 30, 2015 , WES’s consolidated balance sheet included current assets of $2.2 million , long-term assets of $71.9 million , current liabilities of $4.2 million and long-term liabilities of $3.0 million associated with assets held for sale. The sale of these assets is expected to close on July 31, 2015. |
Partnership Distributions
Partnership Distributions | 6 Months Ended |
Jun. 30, 2015 | |
Distributions Made to Members or Limited Partners [Abstract] | |
Partnership Distributions | 3. PARTNERSHIP DISTRIBUTIONS WGP partnership distributions. WGP’s partnership agreement requires WGP to distribute all of its available cash (as defined in its partnership agreement) to WGP unitholders of record on the applicable record date within 55 days of the end of each quarter. The Board of Directors of WGP GP declared the following cash distributions to WGP unitholders for the periods presented: thousands except per-unit amounts Quarters Ended Total Quarterly Distribution per Unit Total Quarterly Cash Distribution Date of Distribution 2014 March 31 $ 0.25000 $ 54,726 May 2014 June 30 0.27125 59,378 August 2014 September 30 0.29125 63,756 November 2014 December 31 0.31250 68,409 February 2015 2015 March 31 $ 0.34250 $ 74,977 May 2015 June 30 (1) 0.36375 79,630 August 2015 (1) On July 16, 2015 , the Board of Directors of WGP GP declared a cash distribution to WGP unitholders of $0.36375 per unit, or $79.6 million in aggregate. The cash distribution is payable on August 21, 2015 , to WGP unitholders of record at the close of business on July 31, 2015 . WES partnership distributions. WES’s partnership agreement requires WES to distribute all of its available cash (as defined in WES’s partnership agreement) to WES unitholders of record on the applicable record date within 45 days of the end of each quarter. The Board of Directors of WES GP declared the following cash distributions to WES’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 2014 March 31 $ 0.625 $ 98,749 May 2014 June 30 0.650 105,655 August 2014 September 30 0.675 111,608 November 2014 December 31 0.700 126,044 February 2015 2015 March 31 $ 0.725 $ 133,203 May 2015 June 30 (1) 0.750 139,736 August 2015 (1) On July 16, 2015 , the Board of Directors of WES GP declared a cash distribution to WES unitholders of $0.750 per unit, or $139.7 million in aggregate, including incentive distributions, but excluding distributions on WES Class C units (see WES Class C unit distributions below). The cash distribution is payable on August 12, 2015 , to WES unitholders of record at the close of business on July 31, 2015 . 3. PARTNERSHIP DISTRIBUTIONS (CONTINUED) WES Class C unit distributions. WES’s Class C units receive quarterly distributions at a rate equivalent to WES’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 December 31, 2017 (unless earlier converted), and the Class C units are disregarded with respect to WES’s distribution of WES’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 WES’s common units for the ten days immediately preceding the payment date for the WES common unit distribution, less a 6% discount. WES records the PIK Class C unit distributions at fair value at the time of issuance. This Level 2 fair value measurement uses WES’s unit price as a significant input in the determination of the fair value. WES issued the following PIK Class C units to APC Midstream Holdings, LLC (“AMH”), the holder of the Class C units, for the periods presented: thousands except unit amounts For the Quarters Ended PIK Class C Units Implied Fair Value Date of 2014 December 31 (1) 45,711 $ 3,072 February 2015 2015 March 31 118,230 $ 8,101 May 2015 (1) Prorated for the 37 -day period the Class C units were outstanding during the fourth quarter of 2014. |
Equity and Partners' Capital
Equity and Partners' Capital | 6 Months Ended |
Jun. 30, 2015 | |
Partners' Capital Notes [Abstract] | |
Equity and Partners' Capital | 4. EQUITY AND PARTNERS’ CAPITAL Holdings of WGP equity. WGP’s common units are listed on the New York Stock Exchange under the symbol “WGP.” As of June 30, 2015 , Anadarko held 191,087,365 of WGP’s common units, representing an 87.3% limited partner interest in WGP, and, through its ownership of WGP GP, Anadarko indirectly held the entire non-economic general partner interest in WGP. The public held 27,826,323 WGP common units, representing a 12.7% limited partner interest in WGP. In June 2015, Anadarko sold 2,300,000 of its WGP common units to the public through an underwritten offering, including 300,000 common units pursuant to the full exercise of the underwriters’ over-allotment option. WGP did not receive any proceeds from, or incur any expense in, the public offering. In July 2014, Anadarko sold 5,750,000 of its WGP common units to the public through an underwritten offering, including 750,000 common units pursuant to the full exercise of the underwriters’ over-allotment option. WGP did not receive any proceeds from, or incur any expense in, the public offering. Tangible equity units. In June 2015, Anadarko completed the public issuance of 9,200,000 , 7.50% tangible equity units (“TEUs”), including 1,200,000 TEUs pursuant to the full exercise of the underwriters’ over-allotment option, at a price to the public of $50.00 per TEU. Each TEU that Anadarko issued consists of (1) a prepaid equity purchase contract for WGP common units owned by Anadarko (subject to Anadarko’s right to elect to deliver shares of its common stock in lieu of such WGP common units) and (2) a senior amortizing note due June 7, 2018 . WGP did not receive any proceeds from, or incur any expense in, the public offering. Please see Note 7—Tangible Equity Units in the Notes to Consolidated Financial Statements under Part I, Item 1 of Anadarko’s Form 10-Q for the three months ended June 30, 2015 (which is not, and shall not be deemed to be, incorporated by reference herein), for a full discussion of the TEUs. 4. EQUITY AND PARTNERS’ CAPITAL (CONTINUED) Net income per common unit. For WGP, earnings per unit is calculated by dividing the limited partners’ interest in net income by the weighted-average number of common units outstanding. Net income per common unit is calculated assuming that cash distributions are equal to the net income attributable to WGP. Net income attributable to the WES assets (as defined in Note 1 ) acquired from Anadarko for periods prior to WES’s acquisition of the WES assets is not allocated to the limited partners when calculating net income per common unit. Net income equal to the amount of available cash (as defined by WGP’s partnership agreement) is allocated to WGP common unitholders consistent with actual cash distributions. Holdings of WES equity. As of June 30, 2015 , WGP held 49,296,205 WES common units, representing a 34.7% limited partner interest in WES, and, through its ownership of WES GP, WGP indirectly held 2,583,068 general partner units, representing a 1.8% general partner interest in WES, and 100% of WES’s IDRs. As of June 30, 2015 , other subsidiaries of Anadarko held 757,619 WES common units and 11,077,794 Class C units, representing an aggregate 8.3% limited partner interest in WES, and the public held 78,520,822 WES common units, representing a 55.2% limited partner interest in WES, which are both reflected as noncontrolling interests within the consolidated financial statements of WGP (see Note 1 and Note 2 ). WES equity offerings. WES completed the following public offerings of its common units during 2015 and 2014, including through its Continuous Offering Programs (“COP”): thousands except unit and per-unit amounts WES Common Units Issued WES GP Units Issued (1) Price Per Unit Underwriting Discount and Other Offering Expenses Net Proceeds to WES 2014 $125.0 million COP (2) 1,133,384 23,132 $ 73.48 $ 1,738 $ 83,245 November 2014 equity offering (3) 8,620,153 153,061 70.85 18,615 602,967 2015 $500.0 million COP (4) 873,525 — $ 66.61 $ 782 $ 57,408 (1) Represents general partner units of WES issued to WES GP in exchange for WES GP’s proportionate capital contribution. (2) Represents common and general partner units of WES issued during the year ended December 31, 2014, pursuant to WES’s registration statement filed with the SEC in August 2012 authorizing the issuance of up to an aggregate of $125.0 million of WES common units (the “$125.0 million COP”). Gross proceeds generated (including WES GP’s proportionate capital contributions) during the year ended December 31, 2014, were $85.0 million . The price per unit in the table above represents an average price for all issuances under the $125.0 million COP during the year ended December 31, 2014. As of December 31, 2014, WES had used all the capacity to issue common units under this registration statement. (3) Includes the issuance of 1,120,153 WES common units pursuant to the partial exercise of the underwriters’ over-allotment option, the net proceeds from which were $77.0 million . Beginning with this partial exercise, WES GP elected not to make a corresponding capital contribution to maintain its 2.0% interest in WES. (4) Represents common units of WES issued during the six months ended June 30, 2015 , pursuant to WES’s registration statement filed with the SEC in August 2014 authorizing the issuance of up to an aggregate of $500.0 million of WES common units (the “$500.0 million COP”). Gross proceeds generated during the three and six months ended June 30, 2015 , were $26.7 million and $58.2 million , respectively. Commissions paid during the three and six months ended June 30, 2015 , were $0.3 million and $0.6 million , respectively. The price per unit in the table above represents an average price for all issuances under the $500.0 million COP during the six months ended June 30, 2015 . 4. EQUITY AND PARTNERS’ CAPITAL (CONTINUED) WES Class C units. In connection with the closing of the DBM acquisition in November 2014, WES issued 10,913,853 Class C units to AMH at a price of $68.72 per unit, generating proceeds of $750.0 million , pursuant to the Unit Purchase Agreement (“UPA”) with Anadarko and AMH. All outstanding Class C units will convert into common units on a one-for-one basis on December 31, 2017, unless WES elects to convert such units earlier or Anadarko extends the conversion date. The Class C units were issued to partially fund WES’s acquisition of DBM, and the UPA contains an optional redemption feature that provides WES the ability to redeem up to $150.0 million of the Class C units within 10 days of the receipt of cash proceeds from an entity that is not an affiliate of WES or AMH, if these cash proceeds were in relation to (i) the assets of DBM, (ii) the equity interests in DBM or (iii) the equity interests in a subsidiary of WES that owns a majority of the outstanding equity interests in DBM. As of June 30, 2015 , no such proceeds had been received and no WES Class C units had been redeemed. WES common, Class C and general partner units . The following table summarizes WES’s common, Class C and general partner units issued during the six months ended June 30, 2015 : WES Common Units WES Class C Units WES General Partner Units Total Balance at December 31, 2014 127,695,130 10,913,853 2,583,068 141,192,051 PIK Class C units — 163,941 — 163,941 Long-Term Incentive Plan award vestings 5,991 — — 5,991 $500.0 million COP 873,525 — — 873,525 Balance at June 30, 2015 128,574,646 11,077,794 2,583,068 142,235,508 |
Transactions with Affiliates
Transactions with Affiliates | 6 Months Ended |
Jun. 30, 2015 | |
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 WES from services provided to Anadarko as well as from the sale of residue, drip condensate and NGLs to Anadarko. In addition, WES 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 WES assets, whether in providing services to affiliates or to third parties, including field labor, measurement and analysis, and other disbursements. A portion of general and administrative expenses is paid by Anadarko, which results in affiliate transactions pursuant to the reimbursement provisions of the omnibus agreements of WES and WGP. 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 WES 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 acquisition of WES 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 WES assets. Subsequent to the acquisition of WES 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 WES. 5. TRANSACTIONS WITH AFFILIATES (CONTINUED) Note receivable from and Deferred purchase price obligation - Anadarko. Concurrently with the closing of WES’s May 2008 initial public offering, WES 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 $304.5 million and $317.8 million at June 30, 2015 , and December 31, 2014 , 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 WES for the March 2015 acquisition of DBJV consists of a cash payment to Anadarko due on March 31, 2020. See Note 2 and Note 9 . Commodity price swap agreements. WES has commodity price swap agreements with Anadarko to mitigate exposure to a substantial majority of the commodity price volatility that would otherwise be present as a result of the purchase and sale of natural gas, condensate or NGLs. 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 at the Hugoton system, the MGR assets and the DJ Basin complex, with various expiration dates through December 2016 . On December 31, 2014, WES’s commodity price swap agreements for the Hilight and Newcastle systems and the Granger complex (excluding the Granger straddle plant) expired without renewal. 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. Below is a summary of the fixed price ranges on all of WES’s outstanding commodity price swap agreements as of June 30, 2015 : per barrel except natural gas 2015 2016 Ethane $ 18.41 − 23.41 $ 23.11 Propane 47.08 − 52.99 52.90 Isobutane 62.09 − 74.02 73.89 Normal butane 54.62 − 65.04 64.93 Natural gasoline 72.88 − 81.82 81.68 Condensate 76.47 − 81.82 81.68 Natural gas (per MMBtu) 4.66 − 5.96 4.87 The following table summarizes gains and losses upon settlement of commodity price swap agreements: Three Months Ended Six Months Ended thousands 2015 2014 2015 2014 Gains (losses) on commodity price swap agreements related to sales: (1) Natural gas sales $ 22,344 $ 2,013 $ 33,326 $ (1,654 ) Natural gas liquids sales 38,297 34,554 82,729 44,009 Total 60,641 36,567 116,055 42,355 Losses on commodity price swap agreements related to purchases (2) (41,720 ) (18,529 ) (75,899 ) (18,548 ) Net gains (losses) on commodity price swap agreements $ 18,921 $ 18,038 $ 40,156 $ 23,807 (1) Reported in affiliate natural gas, natural gas liquids and drip condensate sales in the consolidated statements of income in the period in which the related sale is recorded. (2) Reported in cost of product in the consolidated statements of income in the period in which the related purchase is recorded. 5. TRANSACTIONS WITH AFFILIATES (CONTINUED) DJ Basin complex and Hugoton system swap extensions. On June 25, 2015, WES extended its commodity price swap agreements with Anadarko for the DJ Basin complex from July 1, 2015, through December 31, 2015, and for the Hugoton system from October 1, 2015, through December 31, 2015. The table below summarizes the swap prices compared to the forward market prices on the date the commodity price swap extensions were executed. DJ Basin Complex Hugoton System per barrel except natural gas 2015 Swap Prices Market Prices (1) 2015 Swap Prices Market Prices (1) Ethane $ 18.41 $ 1.96 — — Propane 47.08 13.10 — — Isobutane 62.09 19.75 — — Normal butane 54.62 18.99 — — Natural gasoline 72.88 52.59 — — Condensate 76.47 52.59 $ 78.61 $ 32.56 Natural gas (per MMBtu) 5.96 2.75 5.50 2.74 (1) Represents the New York Mercantile Exchange forward strip price as of June 25, 2015, adjusted for location, basis and, in the case of NGLs, transportation and fractionation costs. Revenues or costs attributable to volumes settled during the respective extension period, at the applicable market price in the above table, will be recognized in the consolidated statements of income. WES will also record a capital contribution from Anadarko in its consolidated statement of equity and partners’ capital, and a contribution to noncontrolling interests in WGP’s statement of equity and partners’ capital, for the amount by which the swap price exceeds the applicable market price in the above table. Gas gathering and processing agreements. WES has significant gas gathering and processing arrangements with affiliates of Anadarko on a majority of its systems. WES’s gathering, transportation and treating throughput (excluding equity investment throughput and throughput measured in barrels) attributable to natural gas production owned or controlled by Anadarko was 47% for the three and six months ended June 30, 2015 , and 50% and 49% for the three and six months ended June 30, 2014 , respectively. WES’s processing throughput (excluding equity investment throughput and throughput measured in barrels) attributable to natural gas production owned or controlled by Anadarko was 52% for the three and six months ended June 30, 2015 , and 58% for the three and six months ended June 30, 2014 . Purchase and sale agreements. WES sells a significant amount of its natural gas, condensate and NGLs to Anadarko Energy Services Company (“AESC”), Anadarko’s marketing affiliate. In addition, WES purchases natural gas, condensate and NGLs from AESC pursuant to purchase agreements. WES’s purchase and sale agreements with AESC are generally one-year contracts, subject to annual renewal. 5. TRANSACTIONS WITH AFFILIATES (CONTINUED) WGP LTIP. WGP GP awards phantom units under the Western Gas Equity Partners, LP 2012 Long-Term Incentive Plan (“WGP LTIP”) primarily to its independent directors and its Chief Executive Officer. 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 over the vesting period was $62,000 and $117,000 for the three and six months ended June 30, 2015 , respectively, and $25,000 and $52,000 for the three and six months ended June 30, 2014 , respectively. WES LTIP. WES GP 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 WES. 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 and $0.2 million for the three and six months ended June 30, 2015 , respectively, and $0.2 million and $0.3 million for the three and six months ended June 30, 2014 , respectively. WGP LTIP and Anadarko Incentive Plans. General and administrative expenses included $1.0 million and $2.0 million for the three and six months ended June 30, 2015 , respectively, and $0.9 million and $1.8 million for the three and six months ended June 30, 2014 , respectively, of equity-based compensation expense, allocated to WES by Anadarko, for awards granted to the executive officers of WES GP and other employees under the WGP LTIP and the Anadarko Petroleum Corporation 2008 and 2012 Omnibus Incentive Compensation Plans (collectively referred to as the “Anadarko Incentive Plans”). Of this amount, $1.7 million is reflected as a contribution to partners’ capital in the consolidated statement of equity and partners’ capital for the six months ended June 30, 2015 . Equipment purchases and sales. The following table summarizes WES’s purchases from and sales to Anadarko for pipe and equipment: Six Months Ended June 30, 2015 2014 2015 2014 thousands Purchases Sales Cash consideration $ 9,968 $ 4,702 $ 700 $ — Net carrying value 4,908 4,745 366 — Partners’ capital adjustment $ 5,060 $ (43 ) $ 334 $ — 5. TRANSACTIONS WITH AFFILIATES (CONTINUED) Summary of affiliate transactions. The following table summarizes affiliate transactions, which include revenue from affiliates, reimbursement of operating expenses and purchases of natural gas: Three Months Ended Six Months Ended thousands 2015 2014 2015 2014 Revenues (1) $ 259,448 $ 266,523 $ 505,163 $ 481,519 Equity income, net (1) 18,941 13,008 37,161 22,259 Cost of product (1) 52,139 36,890 94,546 55,246 Operation and maintenance (2) 17,496 16,827 32,872 29,378 General and administrative (3) 7,513 7,090 15,279 14,572 Operating expenses 77,148 60,807 142,697 99,196 Interest income (4) 4,225 4,225 8,450 8,450 Interest expense (5) 4,190 — 5,612 — Distributions to WGP unitholders (6) 66,235 49,784 126,669 95,835 Distributions to WES unitholders (7) 550 474 1,080 743 (1) Represents amounts earned or incurred on and subsequent to the date of acquisition of WES assets, as well as amounts earned or incurred by Anadarko on a historical basis related to WES assets prior to the acquisition of such assets by WES, 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 WES assets, as well as expenses incurred by Anadarko on a historical basis related to WES assets prior to the acquisition of such assets by WES. (3) Represents general and administrative expense incurred on and subsequent to the date of WES’s acquisition of WES assets, as well as a management services fee for reimbursement of expenses incurred by Anadarko for periods prior to the acquisition of WES assets by WES. These amounts include equity-based compensation expense allocated to WES and WGP by Anadarko (see WES LTIP and WGP LTIP and Anadarko Incentive Plans within this Note 5 ) and amounts charged by Anadarko under the WGP omnibus agreement. (4) Represents interest income recognized on the note receivable from Anadarko. (5) For the three and six months ended June 30, 2015 , includes interest expense recognized on the WGP working capital facility (see Note 9 ) and WES’s accretion expense recognized on the Deferred purchase price obligation - Anadarko for the acquisition of DBJV (see Note 2 and Note 9 ). (6) Represents distributions paid under WGP’s partnership agreement (see Note 3 and Note 4 ). (7) Represents distributions paid to other subsidiaries of Anadarko under WES’s partnership agreement (see Note 3 and Note 4 ). Concentration of credit risk. Anadarko was the only customer from whom revenues exceeded 10% of consolidated revenues for all periods presented in the consolidated statements of income. |
Property, Plant and Equipment
Property, Plant and Equipment | 6 Months Ended |
Jun. 30, 2015 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | 6. PROPERTY, PLANT AND EQUIPMENT A summary of the historical cost of property, plant and equipment is as follows: thousands Estimated Useful Life June 30, 2015 December 31, 2014 Land n/a $ 3,336 $ 2,884 Gathering systems 3 to 47 years 5,527,042 4,972,892 Pipelines and equipment 15 to 45 years 136,303 151,107 Assets under construction n/a 262,334 483,347 Other 3 to 40 years 19,133 16,420 Total property, plant and equipment 5,948,148 5,626,650 Accumulated depreciation 1,165,607 1,055,207 Net property, plant and equipment $ 4,782,541 $ 4,571,443 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. During 2015, WES recognized impairments of $9.5 million , primarily due to the abandonment of compressors at the MIGC system and the DJ Basin complex. See Note 2 for a discussion of WES’s assets held for sale as of June 30, 2015 . |
Equity Investments
Equity Investments | 6 Months Ended |
Jun. 30, 2015 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity Investments | 7. EQUITY INVESTMENTS The following table presents the activity of WES’s equity investments for the six months ended June 30, 2015 : Equity Investments thousands Fort Union White Cliffs Rendezvous Mont Belvieu JV TEG TEP FRP Total Balance at December 31, 2014 $ 25,933 $ 44,315 $ 56,336 $ 121,337 $ 16,790 $ 198,793 $ 170,988 $ 634,492 Investment earnings (loss), net of amortization 3,191 7,214 1,001 11,377 231 6,818 7,329 37,161 Contributions — 4,370 — (433 ) — 1,430 1,403 6,770 Distributions (3,656 ) (6,923 ) (1,972 ) (12,035 ) (436 ) (6,944 ) (7,068 ) (39,034 ) Distributions in excess of cumulative earnings (1) — (2,026 ) (1,863 ) (1,025 ) (80 ) (2,798 ) (746 ) (8,538 ) Balance at June 30, 2015 $ 25,468 $ 46,950 $ 53,502 $ 119,221 $ 16,505 $ 197,299 $ 171,906 $ 630,851 (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 | 6 Months Ended |
Jun. 30, 2015 | |
Components Of Working Capital [Abstract] | |
Components of Working Capital | 8. COMPONENTS OF WORKING CAPITAL A summary of other current assets is as follows: thousands June 30, 2015 December 31, 2014 Natural gas liquids inventory $ 6,447 $ 5,316 Natural gas imbalance receivables 1,016 415 Prepaid insurance 699 3,217 Other 3,861 1,893 Total other current assets $ 12,023 $ 10,841 A summary of accrued liabilities is as follows: thousands June 30, 2015 December 31, 2014 Accrued capital expenditures $ 78,086 $ 128,856 Accrued plant purchases 37,928 14,023 Accrued interest expense 26,071 24,741 Short-term asset retirement obligations 4,450 1,224 Short-term remediation and reclamation obligations 475 475 Income taxes payable 416 207 Other 2,243 1,338 Total accrued liabilities $ 149,669 $ 170,864 |
Debt and Interest Expense
Debt and Interest Expense | 6 Months Ended |
Jun. 30, 2015 | |
Debt Instruments [Abstract] | |
Debt and Interest Expense | 9. DEBT AND INTEREST EXPENSE At June 30, 2015 , WES’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 borrowings on WES’s senior unsecured revolving credit facility (“WES RCF”). The following table presents WES and WGP’s outstanding debt as of June 30, 2015 , and December 31, 2014 : June 30, 2015 December 31, 2014 thousands Principal Carrying Value Fair Value (1) Principal Carrying Value Fair Value (1) WGP working capital facility - Anadarko $ — $ — $ — $ 1,150 $ 1,150 $ 1,150 Long-term debt 2021 Notes $ 500,000 $ 495,995 $ 544,930 $ 500,000 $ 495,714 $ 549,530 2022 Notes 670,000 672,752 673,994 670,000 672,930 681,942 2018 Notes 350,000 350,412 352,497 350,000 350,474 352,162 2044 Notes 400,000 393,879 400,692 400,000 393,836 417,619 2025 Notes 500,000 493,985 482,161 — — — WES RCF 270,000 270,000 270,000 510,000 510,000 510,000 Total long-term debt $ 2,690,000 $ 2,677,023 $ 2,724,274 $ 2,430,000 $ 2,422,954 $ 2,511,253 (1) Fair value is measured using Level 2 inputs. 9. DEBT AND INTEREST EXPENSE (CONTINUED) Debt activity. The following table presents WES and WGP’s debt activity for the six months ended June 30, 2015 : thousands Carrying Value Balance at December 31, 2014 $ 2,424,104 WES RCF borrowings 280,000 Issuance of 2025 Notes 500,000 Repayments of WES RCF (520,000 ) Repayment of WGP working capital facility (1,150 ) Other (5,931 ) Balance at June 30, 2015 $ 2,677,023 WES Senior Notes. The 2025 Notes issued in June 2015 were offered at a price to the public of 98.789% of the face amount. Including the effects of the issuance and underwriting discounts, the effective interest rate of the 2025 Notes is 4.205% . Interest is paid semi-annually on June 1 and December 1 of each year. Proceeds (net of underwriting discount of $3.3 million , original issue discount and debt issuance costs) were used to repay a portion of the amount outstanding under the WES RCF. At June 30, 2015 , WES was in compliance with all covenants under the indentures governing its outstanding notes. WES RCF. The interest rate on the WES RCF, which matures in February 2019, was 1.49% and 1.46% at June 30, 2015 , and June 30, 2014 , respectively. The facility fee rate was 0.20% at June 30, 2015 , and June 30, 2014 . As of June 30, 2015 , WES had $270.0 million of outstanding borrowings, $12.8 million in outstanding letters of credit and $917.2 million available for borrowing under the WES RCF. At June 30, 2015 , WES was in compliance with all covenants under the WES RCF. WGP working capital facility. On November 1, 2012, WGP entered into a $30.0 million working capital facility (the “WGP WCF”) with Anadarko as the lender. Borrowings under the facility will mature on November 1, 2017. The interest rate was 1.69% and 1.66% at June 30, 2015 , and June 30, 2014 , respectively. As of June 30, 2015 , WGP had no outstanding borrowings and $30.0 million available for borrowing under the WGP WCF. At June 30, 2015 , WGP was in compliance with all covenants under the WGP WCF. Interest expense. The following table summarizes the amounts included in interest expense: Three Months Ended Six Months Ended June 30, thousands 2015 2014 2015 2014 Third parties Long-term debt $ 24,733 $ 21,445 $ 48,075 $ 37,580 Amortization of debt issuance costs and commitment fees 1,374 1,426 2,666 2,692 Capitalized interest (2,693 ) (2,007 ) (5,787 ) (5,447 ) Total interest expense – third parties 23,414 20,864 44,954 34,825 Affiliates WGP WCF — — 2 — Deferred purchase price obligation – Anadarko (1) 4,190 — 5,610 — Total interest expense – affiliates 4,190 — 5,612 — Interest expense $ 27,604 $ 20,864 $ 50,566 $ 34,825 (1) See Note 2 for a discussion of the accretion and present value of the Deferred purchase price obligation - Anadarko. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 10. COMMITMENTS AND CONTINGENCIES Litigation and legal proceedings. In March 2011, DCP Midstream, LP (“DCP”) filed a lawsuit against Anadarko and others, including a subsidiary of WES, Kerr-McGee Gathering, LLC, in Weld County District Court (the “Court”) in Colorado, alleging that Anadarko diverted gas from DCP’s gathering and processing facilities in breach of certain dedication agreements. In addition to various claims against Anadarko, DCP is claiming unjust enrichment and other damages against Kerr-McGee Gathering, LLC, the entity that holds the Wattenberg assets (located in the DJ Basin complex). Anadarko countersued DCP asserting that DCP has not properly allocated values and charges to Anadarko for the gas that DCP gathers and/or processes, and seeks a judgment that DCP has no valid gathering or processing rights to much of the gas production it is claiming, in addition to other claims. The Court has scheduled this matter for trial in June 2016, and the parties are currently engaged in discovery and motion practice. Management does not believe the outcome of this proceeding will have a material effect on the financial condition, results of operations or cash flows of WGP. WES intends to vigorously defend this litigation. Furthermore, without regard to the merit of DCP’s claims, management believes that WES has adequate contractual indemnities covering the claims against it in this lawsuit. In addition, from time to time, WGP, through its partnership interests in WES, 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 for which a final disposition could have a material adverse effect on the financial condition, results of operations or cash flows of WGP. Other commitments. WES has short-term payment obligations, or commitments, related to its capital spending programs, as well as those of its unconsolidated affiliates. As of June 30, 2015 , WES had unconditional payment obligations for services to be rendered or products to be delivered in connection with its capital projects of $52.3 million , the majority of which is expected to be paid in the next twelve months. These commitments relate primarily to construction of Trains IV and V at the DBM complex and continued expansion at the DJ Basin complex, as well as projects at the Haley system. Lease commitments. Anadarko, on WES’s behalf, has entered into lease agreements for corporate offices, shared field offices and a warehouse supporting WES’s operations, for which Anadarko charges WES rent. The leases for the corporate offices and shared field offices extend through 2017 and 2018, respectively, and the lease for the warehouse extends through February 2017. Rent expense associated with the office, warehouse and equipment leases was $4.5 million and $8.7 million for the three and six months ended June 30, 2015 , respectively, and $2.0 million and $4.3 million for the three and six months ended June 30, 2014 , respectively. |
Description of Business and B20
Description of Business and Basis of Presentation (Policies) | 6 Months Ended |
Jun. 30, 2015 | |
Accounting Policies [Abstract] | |
Business combinations policy | Basis of presentation. 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 WGP and entities in which it holds a controlling financial interest, including WES and WES GP. All significant intercompany transactions have been eliminated. Investments in non-controlled entities over which WES, or WGP through its investment in WES, exercises significant influence are accounted for under the equity method. WGP proportionately consolidates WES’s 33.75% share of the assets, liabilities, revenues and expenses attributable to the Non-Operated Marcellus Interest systems and Anadarko-Operated Marcellus Interest systems and WES’s 50% share of the assets, liabilities, revenues and expenses attributable to the Newcastle system and the DBJV system (see Note 2 ) in the accompanying consolidated financial statements. The consolidated financial results of WES are included in WGP’s consolidated financial statements due to WGP’s 100% ownership interest in WES GP and WES GP’s control of WES. Throughout these notes to consolidated financial statements, and to the extent material, any differences between the consolidated financial results of WGP and WES are discussed separately. WGP has no independent operations or material assets other than its partnership interests in WES. WGP’s consolidated financial statements differ from those of WES primarily as a result of (i) the presentation of noncontrolling interest ownership (attributable to the limited partner interests in WES held by the public and other subsidiaries of Anadarko), (ii) the elimination of WES GP’s investment in WES with WES GP’s underlying capital account, and (iii) the general and administrative expenses incurred by WGP, which are separate from, and in addition to, those incurred by WES. Presentation of WES assets. The term “WES assets” refers to the assets indirectly owned and interests accounted for under the equity method (see Note 7 ) by WGP through its partnership interests in WES as of June 30, 2015 . Because WGP owns the entire interest in and controls WES GP, and WGP GP is owned and controlled by Anadarko, each of WES’s acquisitions of WES assets from Anadarko has been considered a transfer of net assets between entities under common control. As such, WES assets acquired from Anadarko were initially recorded at Anadarko’s historic carrying value, which did not correlate to the total acquisition price paid by WES. Further, after an acquisition of WES assets from Anadarko, WES and WGP (by virtue of its consolidation of WES) may be required to recast their financial statements to include the activities of such WES assets from the date of common control. See Note 2 . For those periods requiring recast, the consolidated financial statements for periods prior to the acquisition of WES assets from Anadarko have been 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 WES had owned the WES assets during the periods reported. Net income attributable to the WES assets acquired from Anadarko for periods prior to WES’s acquisition of the WES assets is not allocated to the limited partners. DBM acquisition . The DBM acquisition has been accounted for under the acquisition method of accounting. The assets acquired and liabilities assumed in the DBM acquisition were recorded in the consolidated balance sheet at their estimated fair values as of the acquisition date. Results of operations attributable to the DBM acquisition were included in the consolidated statement of income beginning on the acquisition date in the fourth quarter of 2014. |
Noncontrolling interests policy | Noncontrolling interests. WGP’s noncontrolling interests in the consolidated financial statements consist of the following for all periods presented: (i) the interest in Chipeta Processing LLC (“Chipeta”) held by a third-party member, (ii) the publicly held limited partner interests in WES, (iii) the 757,619 WES common units issued by WES to other subsidiaries of Anadarko as part of the consideration paid for the acquisitions of the Non-Operated Marcellus Interest and the TEFR Interests, and (iv) the WES Class C units issued by WES to a subsidiary of Anadarko as part of the funding for the acquisition of DBM. See Note 3 and Note 4 . The difference between the carrying value of WGP’s investment in WES and the underlying book value of common units issued by WES is accounted for as an equity transaction. Thus, if WES issues common units at a price different than WGP’s per-unit carrying value, any resulting change in the carrying value of WGP’s investment in WES is reflected as an adjustment to partners’ capital. |
Net income per common unit policy | Net income per common unit. For WGP, earnings per unit is calculated by dividing the limited partners’ interest in net income by the weighted-average number of common units outstanding. Net income per common unit is calculated assuming that cash distributions are equal to the net income attributable to WGP. Net income attributable to the WES assets (as defined in Note 1 ) acquired from Anadarko for periods prior to WES’s acquisition of the WES assets is not allocated to the limited partners when calculating net income per common unit. Net income equal to the amount of available cash (as defined by WGP’s partnership agreement) is allocated to WGP common unitholders consistent with actual cash distributions. |
Fair value policy | Deferred purchase price obligation - Anadarko. The consideration to be paid by WES for the acquisition of DBJV consists of a cash payment to Anadarko due on March 31, 2020. The cash payment will be equal to eight multiplied by (a) the average of WES’s share in the Net Earnings (see definition below) of the DBJV system for the calendar years 2018 and 2019, less (b) WES’s share of all capital expenditures incurred for the DBJV system 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 the DBJV system on an accrual basis. As of the acquisition date, the estimated future payment obligation was $282.8 million , which had a net present value of $174.3 million , using a discount rate of 10% . As of June 30, 2015 , the net present value of this obligation was $179.9 million and has been recorded on the consolidated balance sheet under Deferred purchase price obligation - Anadarko. Accretion expense for the three and six months ended June 30, 2015 , was $4.2 million and $5.6 million , respectively, and has been recorded as a charge to interest expense. The fair value measurement was calculated using Level 3 inputs, which consisted of management’s estimate of WES’s share of forecasted Net Earnings and capital expenditures for the DBJV system. DBM acquisition . The DBM acquisition has been accounted for under the acquisition method of accounting. The assets acquired and liabilities assumed in the DBM acquisition were recorded in the consolidated balance sheet at their estimated fair values as of the acquisition date. Results of operations attributable to the DBM acquisition were included in the consolidated statement of income beginning on the acquisition date in the fourth quarter of 2014. The purchase price allocation is based on an assessment of the fair value of the assets acquired and liabilities assumed in the DBM acquisition using inputs that are not observable in the market and thus represent Level 3 inputs. The fair values of the processing plants, gathering system, and related facilities and equipment are based on market and cost approaches. The fair value of the intangible assets was determined using an income approach. Deferred taxes represent the tax effects of differences in the tax basis and acquisition-date fair value of the assets acquired and liabilities assumed. WES Class C unit distributions. WES’s Class C units receive quarterly distributions at a rate equivalent to WES’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 December 31, 2017 (unless earlier converted), and the Class C units are disregarded with respect to WES’s distribution of WES’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 WES’s common units for the ten days immediately preceding the payment date for the WES common unit distribution, less a 6% discount. WES records the PIK Class C unit distributions at fair value at the time of issuance. This Level 2 fair value measurement uses WES’s unit price as a significant input in the determination of the fair value. Note receivable from and Deferred purchase price obligation - Anadarko. Concurrently with the closing of WES’s May 2008 initial public offering, WES 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 $304.5 million and $317.8 million at June 30, 2015 , and December 31, 2014 , 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. |
Use of estimates policy | 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. |
Recently issued accounting standards policy | Recently issued accounting standards . The Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2015-06, Earnings Per Share (Topic - 260)—Effects on Historical Earnings per Unit of Master Limited Partnership Dropdown Transactions . This ASU contains guidance that addresses the historical earnings per unit presentation for master limited partnerships that apply the two-class method of calculating earnings per unit. When a general partner transfers or “drops down” net assets to a master limited partnership the transaction is accounted for as a transaction between entities under common control and the statements of operations are adjusted retrospectively to reflect the transaction. This ASU specifies that the historical earnings (losses) of a transferred business before the date of a dropdown transaction should be allocated entirely to the general partner, and the previously reported earnings per unit of the limited partners should not change as a result of the dropdown transaction. The ASU also requires additional disclosures about how the rights to the earnings (losses) differ before and after the dropdown transaction occurs for purposes of computing earnings per unit under the two-class method. This ASU is effective for annual and interim periods beginning in 2016 and is required to be adopted using a retrospective approach, with early adoption permitted. While WGP believes it is currently in compliance with this ASU, it continues to evaluate the impact of the adoption of this ASU on its consolidated financial statements. The FASB issued ASU 2015-03, Interest—Imputation of Interest (Subtopic 853-30)—Simplifying the Presentation of Debt Issuance Costs . This ASU will simplify the presentation of debt issuance costs by requiring such costs to be presented in the balance sheet as a reduction from the corresponding debt liability rather than as an asset. This ASU is effective for annual and interim periods beginning in 2016 and is required to be adopted using a retrospective approach, with early adoption permitted. WGP does not expect the adoption to have a material impact on its consolidated financial statements. The FASB issued ASU 2015-02, Consolidation—Amendments to the Consolidation Analysis . This ASU will simplify existing requirements by reducing the number of consolidation models and placing more emphasis on risk of loss when determining a controlling financial interest. The provisions will affect how limited partnerships and similar entities are assessed for consolidation, including the elimination of the presumption that a general partner should consolidate a limited partnership. This ASU is effective for annual and interim periods beginning in 2016 and is required to be adopted using a retrospective or modified retrospective approach, with early adoption permitted. WGP is evaluating the impact of the adoption of this ASU on its consolidated financial statements. The FASB issued ASU 2014-09, Revenue from Contracts with Customers . This ASU supersedes the revenue recognition requirements in Topic 605, Revenue Recognition , and industry-specific guidance in Subtopic 932-605, Extractive Activities—Oil and Gas—Revenue Recognition , 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. This ASU is effective for annual and interim periods beginning in 2018 and is required to be adopted using one of two retrospective application methods, with early adoption permitted in 2017. WGP is evaluating the impact of the adoption of this ASU on its consolidated financial statements. |
Description of Business and B21
Description of Business and Basis of Presentation (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Accounting Policies [Abstract] | |
Assets and Investments Table | As of June 30, 2015 , WES’s assets and investments accounted for under the equity method consisted of the following: Owned and Operated Operated Interests Non-Operated Interests Equity Interests Natural gas gathering systems 14 2 5 2 Natural gas treating facilities 10 5 — 1 Natural gas processing facilities 14 5 — 2 NGL pipelines 3 — — 3 Natural gas pipelines 4 — — — Oil pipelines 1 — — 1 |
Acquisitions and Divestitures (
Acquisitions and Divestitures (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Property, Plant and Equipment [Abstract] | |
Acquisitions Table | The following table presents the acquisitions completed by WES during 2015 and 2014 , and identifies the funding sources for such acquisitions: thousands except unit and percent amounts Acquisition Date Percentage Deferred Purchase Price Obligation - Anadarko Borrowings Cash On Hand WES Common Units Issued to Anadarko WES Class C Units Issued to Anadarko TEFR Interests (1) 03/03/2014 Various (1) $ — $ 350,000 $ 6,250 308,490 — DBM (2) 11/25/2014 100 % — 475,000 298,327 — 10,913,853 DBJV system (3) 03/02/2015 50 % 174,276 — — — — (1) WES acquired a 20% interest in each of TEG and TEP and a 33.33% interest in FRP from Anadarko. These assets gather and transport NGLs primarily from the Anadarko and Denver-Julesburg (“DJ”) Basins. The interests in these entities are accounted for under the equity method of accounting. In connection with the issuance of WES common units, WES GP purchased 6,296 general partner units in exchange for WES GP’s proportionate capital contribution of $0.4 million . (2) WES acquired Nuevo Midstream, LLC (“Nuevo”) from a third party. Following the acquisition, WES changed the name of Nuevo to Delaware Basin Midstream, LLC (“DBM”). The assets acquired include cryogenic processing plants, a gas gathering system, and related facilities and equipment, which are collectively referred to as the “DBM complex” and serve production from Reeves, Loving and Culberson Counties, Texas and Eddy and Lea Counties, New Mexico. See DBM acquisition below for further information, including the preliminary allocation of the purchase price. (3) WES acquired Anadarko’s interest in Delaware Basin JV Gathering LLC (“DBJV”), which owns a 50% interest in a gathering system and related facilities (the “DBJV system”). The DBJV system is located in the Delaware Basin in Loving, Ward, Winkler and Reeves Counties, Texas. WES will make a cash payment on March 31, 2020, to Anadarko as consideration for the acquisition of DBJV. WES currently estimates the future payment will be $282.8 million , the net present value of which was $174.3 million as of the acquisition date. See DBJV acquisition—Deferred purchase price obligation - Anadarko below. |
Impact to Historical Consolidated Statement of Income Table | The following table presents the impact of the DBJV system on revenue, equity income, net and net income as presented in WGP’s historical consolidated statements of income: Three Months Ended June 30, 2014 thousands WGP Historical DBJV System Combined Revenues $ 329,944 $ 15,625 $ 345,569 Equity income, net 13,008 — 13,008 Net income 97,746 4,135 101,881 Six Months Ended June 30, 2014 thousands WGP Historical DBJV System Combined Revenues $ 609,401 $ 29,885 $ 639,286 Equity income, net 22,259 — 22,259 Net income 187,921 7,756 195,677 |
Purchase Price Allocation Table | The following is the preliminary allocation of the purchase price as of June 30, 2015 , including $3.5 million of post-closing purchase price adjustments, to the assets acquired and liabilities assumed in the DBM acquisition as of the acquisition date, pending final review of certain support related to the acquired entity’s assets and liabilities: thousands Current assets $ 63,020 Property, plant and equipment 467,171 Goodwill 282,999 Other intangible assets 811,048 Accounts payables (17,679 ) Accrued liabilities (38,684 ) Deferred income taxes (1,342 ) Asset retirement obligations and other (9,060 ) Total purchase price $ 1,557,473 |
Partnership Distributions (Tabl
Partnership Distributions (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Distribution Made to Limited Partner [Line Items] | |
Cash Distributions Tables | The Board of Directors of WGP GP declared the following cash distributions to WGP unitholders for the periods presented: thousands except per-unit amounts Quarters Ended Total Quarterly Distribution per Unit Total Quarterly Cash Distribution Date of Distribution 2014 March 31 $ 0.25000 $ 54,726 May 2014 June 30 0.27125 59,378 August 2014 September 30 0.29125 63,756 November 2014 December 31 0.31250 68,409 February 2015 2015 March 31 $ 0.34250 $ 74,977 May 2015 June 30 (1) 0.36375 79,630 August 2015 (1) On July 16, 2015 , the Board of Directors of WGP GP declared a cash distribution to WGP unitholders of $0.36375 per unit, or $79.6 million in aggregate. The cash distribution is payable on August 21, 2015 , to WGP unitholders of record at the close of business on July 31, 2015 . |
Western Gas Partners, LP [Member] | |
Distribution Made to Limited Partner [Line Items] | |
Cash Distributions Tables | The Board of Directors of WES GP declared the following cash distributions to WES’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 2014 March 31 $ 0.625 $ 98,749 May 2014 June 30 0.650 105,655 August 2014 September 30 0.675 111,608 November 2014 December 31 0.700 126,044 February 2015 2015 March 31 $ 0.725 $ 133,203 May 2015 June 30 (1) 0.750 139,736 August 2015 (1) On July 16, 2015 , the Board of Directors of WES GP declared a cash distribution to WES unitholders of $0.750 per unit, or $139.7 million in aggregate, including incentive distributions, but excluding distributions on WES Class C units (see WES Class C unit distributions below). The cash distribution is payable on August 12, 2015 , to WES unitholders of record at the close of business on July 31, 2015 . |
PIK Class C Units Distributions Table | WES issued the following PIK Class C units to APC Midstream Holdings, LLC (“AMH”), the holder of the Class C units, for the periods presented: thousands except unit amounts For the Quarters Ended PIK Class C Units Implied Fair Value Date of 2014 December 31 (1) 45,711 $ 3,072 February 2015 2015 March 31 118,230 $ 8,101 May 2015 (1) Prorated for the 37 -day period the Class C units were outstanding during the fourth quarter of 2014. |
Equity and Partners' Capital (T
Equity and Partners' Capital (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Partners' Capital Notes [Abstract] | |
Equity Offerings Table | WES completed the following public offerings of its common units during 2015 and 2014, including through its Continuous Offering Programs (“COP”): thousands except unit and per-unit amounts WES Common Units Issued WES GP Units Issued (1) Price Per Unit Underwriting Discount and Other Offering Expenses Net Proceeds to WES 2014 $125.0 million COP (2) 1,133,384 23,132 $ 73.48 $ 1,738 $ 83,245 November 2014 equity offering (3) 8,620,153 153,061 70.85 18,615 602,967 2015 $500.0 million COP (4) 873,525 — $ 66.61 $ 782 $ 57,408 (1) Represents general partner units of WES issued to WES GP in exchange for WES GP’s proportionate capital contribution. (2) Represents common and general partner units of WES issued during the year ended December 31, 2014, pursuant to WES’s registration statement filed with the SEC in August 2012 authorizing the issuance of up to an aggregate of $125.0 million of WES common units (the “$125.0 million COP”). Gross proceeds generated (including WES GP’s proportionate capital contributions) during the year ended December 31, 2014, were $85.0 million . The price per unit in the table above represents an average price for all issuances under the $125.0 million COP during the year ended December 31, 2014. As of December 31, 2014, WES had used all the capacity to issue common units under this registration statement. (3) Includes the issuance of 1,120,153 WES common units pursuant to the partial exercise of the underwriters’ over-allotment option, the net proceeds from which were $77.0 million . Beginning with this partial exercise, WES GP elected not to make a corresponding capital contribution to maintain its 2.0% interest in WES. (4) Represents common units of WES issued during the six months ended June 30, 2015 , pursuant to WES’s registration statement filed with the SEC in August 2014 authorizing the issuance of up to an aggregate of $500.0 million of WES common units (the “$500.0 million COP”). Gross proceeds generated during the three and six months ended June 30, 2015 , were $26.7 million and $58.2 million , respectively. Commissions paid during the three and six months ended June 30, 2015 , were $0.3 million and $0.6 million , respectively. The price per unit in the table above represents an average price for all issuances under the $500.0 million COP during the six months ended June 30, 2015 . |
Limited Partner and General Partner Units Table | The following table summarizes WES’s common, Class C and general partner units issued during the six months ended June 30, 2015 : WES Common Units WES Class C Units WES General Partner Units Total Balance at December 31, 2014 127,695,130 10,913,853 2,583,068 141,192,051 PIK Class C units — 163,941 — 163,941 Long-Term Incentive Plan award vestings 5,991 — — 5,991 $500.0 million COP 873,525 — — 873,525 Balance at June 30, 2015 128,574,646 11,077,794 2,583,068 142,235,508 |
Transactions with Affiliates (T
Transactions with Affiliates (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Related Party Fees and Other Arrangements, Limited Liability Company (LLC) or Limited Partnership (LP) [Abstract] | |
Commodity Price Swap Agreements Table | Below is a summary of the fixed price ranges on all of WES’s outstanding commodity price swap agreements as of June 30, 2015 : per barrel except natural gas 2015 2016 Ethane $ 18.41 − 23.41 $ 23.11 Propane 47.08 − 52.99 52.90 Isobutane 62.09 − 74.02 73.89 Normal butane 54.62 − 65.04 64.93 Natural gasoline 72.88 − 81.82 81.68 Condensate 76.47 − 81.82 81.68 Natural gas (per MMBtu) 4.66 − 5.96 4.87 |
Gains (Losses) on Commodity Price Swap Agreements Table | The following table summarizes gains and losses upon settlement of commodity price swap agreements: Three Months Ended Six Months Ended thousands 2015 2014 2015 2014 Gains (losses) on commodity price swap agreements related to sales: (1) Natural gas sales $ 22,344 $ 2,013 $ 33,326 $ (1,654 ) Natural gas liquids sales 38,297 34,554 82,729 44,009 Total 60,641 36,567 116,055 42,355 Losses on commodity price swap agreements related to purchases (2) (41,720 ) (18,529 ) (75,899 ) (18,548 ) Net gains (losses) on commodity price swap agreements $ 18,921 $ 18,038 $ 40,156 $ 23,807 (1) Reported in affiliate natural gas, natural gas liquids and drip condensate sales in the consolidated statements of income in the period in which the related sale is recorded. (2) Reported in cost of product in the consolidated statements of income in the period in which the related purchase is recorded. |
Commodity Price Swap Agreements Extensions Table | The table below summarizes the swap prices compared to the forward market prices on the date the commodity price swap extensions were executed. DJ Basin Complex Hugoton System per barrel except natural gas 2015 Swap Prices Market Prices (1) 2015 Swap Prices Market Prices (1) Ethane $ 18.41 $ 1.96 — — Propane 47.08 13.10 — — Isobutane 62.09 19.75 — — Normal butane 54.62 18.99 — — Natural gasoline 72.88 52.59 — — Condensate 76.47 52.59 $ 78.61 $ 32.56 Natural gas (per MMBtu) 5.96 2.75 5.50 2.74 (1) Represents the New York Mercantile Exchange forward strip price as of June 25, 2015, adjusted for location, basis and, in the case of NGLs, transportation and fractionation costs. |
Related Party Transactions Tables | The following table summarizes WES’s purchases from and sales to Anadarko for pipe and equipment: Six Months Ended June 30, 2015 2014 2015 2014 thousands Purchases Sales Cash consideration $ 9,968 $ 4,702 $ 700 $ — Net carrying value 4,908 4,745 366 — Partners’ capital adjustment $ 5,060 $ (43 ) $ 334 $ — The following table summarizes affiliate transactions, which include revenue from affiliates, reimbursement of operating expenses and purchases of natural gas: Three Months Ended Six Months Ended thousands 2015 2014 2015 2014 Revenues (1) $ 259,448 $ 266,523 $ 505,163 $ 481,519 Equity income, net (1) 18,941 13,008 37,161 22,259 Cost of product (1) 52,139 36,890 94,546 55,246 Operation and maintenance (2) 17,496 16,827 32,872 29,378 General and administrative (3) 7,513 7,090 15,279 14,572 Operating expenses 77,148 60,807 142,697 99,196 Interest income (4) 4,225 4,225 8,450 8,450 Interest expense (5) 4,190 — 5,612 — Distributions to WGP unitholders (6) 66,235 49,784 126,669 95,835 Distributions to WES unitholders (7) 550 474 1,080 743 (1) Represents amounts earned or incurred on and subsequent to the date of acquisition of WES assets, as well as amounts earned or incurred by Anadarko on a historical basis related to WES assets prior to the acquisition of such assets by WES, 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 WES assets, as well as expenses incurred by Anadarko on a historical basis related to WES assets prior to the acquisition of such assets by WES. (3) Represents general and administrative expense incurred on and subsequent to the date of WES’s acquisition of WES assets, as well as a management services fee for reimbursement of expenses incurred by Anadarko for periods prior to the acquisition of WES assets by WES. These amounts include equity-based compensation expense allocated to WES and WGP by Anadarko (see WES LTIP and WGP LTIP and Anadarko Incentive Plans within this Note 5 ) and amounts charged by Anadarko under the WGP omnibus agreement. (4) Represents interest income recognized on the note receivable from Anadarko. (5) For the three and six months ended June 30, 2015 , includes interest expense recognized on the WGP working capital facility (see Note 9 ) and WES’s accretion expense recognized on the Deferred purchase price obligation - Anadarko for the acquisition of DBJV (see Note 2 and Note 9 ). (6) Represents distributions paid under WGP’s partnership agreement (see Note 3 and Note 4 ). (7) Represents distributions paid to other subsidiaries of Anadarko under WES’s partnership agreement (see Note 3 and Note 4 ). |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment Table | A summary of the historical cost of property, plant and equipment is as follows: thousands Estimated Useful Life June 30, 2015 December 31, 2014 Land n/a $ 3,336 $ 2,884 Gathering systems 3 to 47 years 5,527,042 4,972,892 Pipelines and equipment 15 to 45 years 136,303 151,107 Assets under construction n/a 262,334 483,347 Other 3 to 40 years 19,133 16,420 Total property, plant and equipment 5,948,148 5,626,650 Accumulated depreciation 1,165,607 1,055,207 Net property, plant and equipment $ 4,782,541 $ 4,571,443 |
Equity Investments (Tables)
Equity Investments (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity Investments Table | The following table presents the activity of WES’s equity investments for the six months ended June 30, 2015 : Equity Investments thousands Fort Union White Cliffs Rendezvous Mont Belvieu JV TEG TEP FRP Total Balance at December 31, 2014 $ 25,933 $ 44,315 $ 56,336 $ 121,337 $ 16,790 $ 198,793 $ 170,988 $ 634,492 Investment earnings (loss), net of amortization 3,191 7,214 1,001 11,377 231 6,818 7,329 37,161 Contributions — 4,370 — (433 ) — 1,430 1,403 6,770 Distributions (3,656 ) (6,923 ) (1,972 ) (12,035 ) (436 ) (6,944 ) (7,068 ) (39,034 ) Distributions in excess of cumulative earnings (1) — (2,026 ) (1,863 ) (1,025 ) (80 ) (2,798 ) (746 ) (8,538 ) Balance at June 30, 2015 $ 25,468 $ 46,950 $ 53,502 $ 119,221 $ 16,505 $ 197,299 $ 171,906 $ 630,851 (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) | 6 Months Ended |
Jun. 30, 2015 | |
Components Of Working Capital [Abstract] | |
Other Current Assets Table | A summary of other current assets is as follows: thousands June 30, 2015 December 31, 2014 Natural gas liquids inventory $ 6,447 $ 5,316 Natural gas imbalance receivables 1,016 415 Prepaid insurance 699 3,217 Other 3,861 1,893 Total other current assets $ 12,023 $ 10,841 |
Accrued Liabilities Table | A summary of accrued liabilities is as follows: thousands June 30, 2015 December 31, 2014 Accrued capital expenditures $ 78,086 $ 128,856 Accrued plant purchases 37,928 14,023 Accrued interest expense 26,071 24,741 Short-term asset retirement obligations 4,450 1,224 Short-term remediation and reclamation obligations 475 475 Income taxes payable 416 207 Other 2,243 1,338 Total accrued liabilities $ 149,669 $ 170,864 |
Debt and Interest Expense (Tabl
Debt and Interest Expense (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Debt Instruments [Abstract] | |
Debt Outstanding and Debt Activity Tables | The following table presents WES and WGP’s outstanding debt as of June 30, 2015 , and December 31, 2014 : June 30, 2015 December 31, 2014 thousands Principal Carrying Value Fair Value (1) Principal Carrying Value Fair Value (1) WGP working capital facility - Anadarko $ — $ — $ — $ 1,150 $ 1,150 $ 1,150 Long-term debt 2021 Notes $ 500,000 $ 495,995 $ 544,930 $ 500,000 $ 495,714 $ 549,530 2022 Notes 670,000 672,752 673,994 670,000 672,930 681,942 2018 Notes 350,000 350,412 352,497 350,000 350,474 352,162 2044 Notes 400,000 393,879 400,692 400,000 393,836 417,619 2025 Notes 500,000 493,985 482,161 — — — WES RCF 270,000 270,000 270,000 510,000 510,000 510,000 Total long-term debt $ 2,690,000 $ 2,677,023 $ 2,724,274 $ 2,430,000 $ 2,422,954 $ 2,511,253 (1) Fair value is measured using Level 2 inputs. 9. DEBT AND INTEREST EXPENSE (CONTINUED) Debt activity. The following table presents WES and WGP’s debt activity for the six months ended June 30, 2015 : thousands Carrying Value Balance at December 31, 2014 $ 2,424,104 WES RCF borrowings 280,000 Issuance of 2025 Notes 500,000 Repayments of WES RCF (520,000 ) Repayment of WGP working capital facility (1,150 ) Other (5,931 ) Balance at June 30, 2015 $ 2,677,023 |
Interest Expense Table | The following table summarizes the amounts included in interest expense: Three Months Ended Six Months Ended June 30, thousands 2015 2014 2015 2014 Third parties Long-term debt $ 24,733 $ 21,445 $ 48,075 $ 37,580 Amortization of debt issuance costs and commitment fees 1,374 1,426 2,666 2,692 Capitalized interest (2,693 ) (2,007 ) (5,787 ) (5,447 ) Total interest expense – third parties 23,414 20,864 44,954 34,825 Affiliates WGP WCF — — 2 — Deferred purchase price obligation – Anadarko (1) 4,190 — 5,610 — Total interest expense – affiliates 4,190 — 5,612 — Interest expense $ 27,604 $ 20,864 $ 50,566 $ 34,825 (1) See Note 2 for a discussion of the accretion and present value of the Deferred purchase price obligation - Anadarko. |
Description of Business and B30
Description of Business and Basis of Presentation - Asset Table (Details) - Western Gas Partners, LP [Member] | Jun. 30, 2015unit |
Operated [Member] | Natural Gas Gathering Systems [Member] | |
Assets [Line Items] | |
Assets, number of units | 14 |
Operated [Member] | Natural Gas Treating Facilities [Member] | |
Assets [Line Items] | |
Assets, number of units | 10 |
Operated [Member] | Natural Gas Processing Facilities [Member] | |
Assets [Line Items] | |
Assets, number of units | 14 |
Operated [Member] | Natural Gas Liquids Pipelines [Member] | |
Assets [Line Items] | |
Assets, number of units | 3 |
Operated [Member] | Natural Gas Pipelines [Member] | |
Assets [Line Items] | |
Assets, number of units | 4 |
Operated [Member] | Oil Pipelines [Member] | |
Assets [Line Items] | |
Assets, number of units | 1 |
Operated Interests [Member] | Natural Gas Gathering Systems [Member] | |
Assets [Line Items] | |
Assets, number of units | 2 |
Operated Interests [Member] | Natural Gas Treating Facilities [Member] | |
Assets [Line Items] | |
Assets, number of units | 5 |
Operated Interests [Member] | Natural Gas Processing Facilities [Member] | |
Assets [Line Items] | |
Assets, number of units | 5 |
Non-Operated Interests [Member] | Natural Gas Gathering Systems [Member] | |
Assets [Line Items] | |
Assets, number of units | 5 |
Equity Interests [Member] | Natural Gas Gathering Systems [Member] | |
Assets [Line Items] | |
Assets, number of units | 2 |
Equity Interests [Member] | Natural Gas Treating Facilities [Member] | |
Assets [Line Items] | |
Assets, number of units | 1 |
Equity Interests [Member] | Natural Gas Processing Facilities [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 B31
Description of Business and Basis of Presentation - Additional Information (Details) - Western Gas Partners, LP [Member] - shares | Mar. 02, 2015 | [1] | Nov. 30, 2014 | Jun. 30, 2015 |
General partner's interest | 2.00% | 1.80% | ||
Marginal percentage interest in distributions | 48.00% | |||
Other Subsidiaries Of Anadarko [Member] | ||||
Common units issued | 757,619 | |||
Non-Operated Marcellus Interest [Member] | ||||
Ownership interest | 33.75% | |||
Anadarko-Operated Marcellus Interest [Member] | ||||
Ownership interest | 33.75% | |||
Delaware Basin JV Gathering LLC [Member] | ||||
Ownership interest | 50.00% | 50.00% | ||
Newcastle [Member] | ||||
Ownership interest | 50.00% | |||
Fort Union [Member] | ||||
Equity investment ownership | 14.81% | |||
Rendezvous [Member] | ||||
Equity investment ownership | 22.00% | |||
White Cliffs [Member] | ||||
Equity investment ownership | 10.00% | |||
Mont Belvieu JV [Member] | ||||
Equity investment ownership | 25.00% | |||
Texas Express Pipeline LLC [Member] | ||||
Equity investment ownership | 20.00% | |||
Texas Express Gathering LLC [Member] | ||||
Equity investment ownership | 20.00% | |||
Front Range Pipeline LLC [Member] | ||||
Equity investment ownership | 33.33% | |||
Incentive Distribution Rights [Member] | ||||
General partner's interest | 100.00% | |||
General Partner [Member] | ||||
Ownership interest | 100.00% | |||
[1] | WES acquired Anadarko’s interest in Delaware Basin JV Gathering LLC (“DBJV”), which owns a 50% interest in a gathering system and related facilities (the “DBJV system”). The DBJV system is located in the Delaware Basin in Loving, Ward, Winkler and Reeves Counties, Texas. WES will make a cash payment on March 31, 2020, to Anadarko as consideration for the acquisition of DBJV. WES currently estimates the future payment will be $282.8 million, the net present value of which was $174.3 million as of the acquisition date. See DBJV acquisition—Deferred purchase price obligation - Anadarko below. |
Acquisitions and Divestitures -
Acquisitions and Divestitures - Acquisitions Table (Details) - USD ($) $ in Thousands | Mar. 02, 2015 | Nov. 25, 2014 | Mar. 03, 2014 | Nov. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | [1] | ||
Business Acquisition [Line Items] | |||||||||
Borrowings | $ 769,694 | $ 1,076,895 | |||||||
Western Gas Partners, LP [Member] | |||||||||
Business Acquisition [Line Items] | |||||||||
Units issued | 163,941 | ||||||||
Western Gas Partners, LP [Member] | Class C Units [Member] | |||||||||
Business Acquisition [Line Items] | |||||||||
Units issued | 163,941 | ||||||||
Table Text Block Supplement [Abstract] | |||||||||
Proceeds from the issuance of units | $ 750,000 | ||||||||
Western Gas Partners, LP [Member] | General Partner [Member] | |||||||||
Business Acquisition [Line Items] | |||||||||
Percentage acquired | 100.00% | ||||||||
Units issued | [2],[3] | 153,061 | |||||||
Western Gas Partners, LP [Member] | Texas Express and Front Range [Member] | |||||||||
Business Acquisition [Line Items] | |||||||||
Borrowings | [4] | $ 350,000 | |||||||
Cash on hand | [4] | $ 6,250 | |||||||
Table Text Block Supplement [Abstract] | |||||||||
General partner units issued | 6,296 | ||||||||
Western Gas Partners, LP [Member] | Texas Express and Front Range [Member] | Common Units [Member] | |||||||||
Business Acquisition [Line Items] | |||||||||
Common units issued | [4] | 308,490 | |||||||
Western Gas Partners, LP [Member] | Texas Express and Front Range [Member] | General Partner [Member] | |||||||||
Table Text Block Supplement [Abstract] | |||||||||
Proceeds from the issuance of units | $ 400 | ||||||||
Western Gas Partners, LP [Member] | Texas Express Pipeline LLC [Member] | |||||||||
Table Text Block Supplement [Abstract] | |||||||||
Equity investment ownership | 20.00% | ||||||||
Western Gas Partners, LP [Member] | Texas Express Gathering LLC [Member] | |||||||||
Table Text Block Supplement [Abstract] | |||||||||
Equity investment ownership | 20.00% | ||||||||
Western Gas Partners, LP [Member] | Front Range Pipeline LLC [Member] | |||||||||
Table Text Block Supplement [Abstract] | |||||||||
Equity investment ownership | 33.33% | ||||||||
Western Gas Partners, LP [Member] | Delaware Basin Midstream LLC [Member] | |||||||||
Business Acquisition [Line Items] | |||||||||
Percentage acquired | [5] | 100.00% | |||||||
Borrowings | [5] | $ 475,000 | |||||||
Cash on hand | [5] | $ 298,327 | |||||||
Western Gas Partners, LP [Member] | Delaware Basin Midstream LLC [Member] | Class C Units [Member] | |||||||||
Business Acquisition [Line Items] | |||||||||
Units issued | [5] | 10,913,853 | |||||||
Western Gas Partners, LP [Member] | Delaware Basin JV Gathering LLC [Member] | |||||||||
Business Acquisition [Line Items] | |||||||||
Percentage acquired | 50.00% | [6] | 50.00% | ||||||
Western Gas Partners, LP [Member] | Delaware Basin JV Gathering LLC [Member] | Deferred Purchase Price Obligation - Anadarko [Member] | |||||||||
Business Acquisition [Line Items] | |||||||||
Deferred purchase price obligation to Anadarko - acquisition date value | [6] | $ 174,276 | |||||||
Table Text Block Supplement [Abstract] | |||||||||
Deferred purchase price obligation to Anadarko - future value | $ 282,800 | ||||||||
[1] | Financial information has been recast to include the financial position and results attributable to the DBJV system. See Note 1 and Note 2. | ||||||||
[2] | Includes the issuance of 1,120,153 WES common units pursuant to the partial exercise of the underwriters’ over-allotment option, the net proceeds from which were $77.0 million. Beginning with this partial exercise, WES GP elected not to make a corresponding capital contribution to maintain its 2.0% interest in WES. | ||||||||
[3] | Represents general partner units of WES issued to WES GP in exchange for WES GP’s proportionate capital contribution. | ||||||||
[4] | WES acquired a 20% interest in each of TEG and TEP and a 33.33% interest in FRP from Anadarko. These assets gather and transport NGLs primarily from the Anadarko and Denver-Julesburg (“DJ”) Basins. The interests in these entities are accounted for under the equity method of accounting. In connection with the issuance of WES common units, WES GP purchased 6,296 general partner units in exchange for WES GP’s proportionate capital contribution of $0.4 million. | ||||||||
[5] | WES acquired Nuevo Midstream, LLC (“Nuevo”) from a third party. Following the acquisition, WES changed the name of Nuevo to Delaware Basin Midstream, LLC (“DBM”). The assets acquired include cryogenic processing plants, a gas gathering system, and related facilities and equipment, which are collectively referred to as the “DBM complex” and serve production from Reeves, Loving and Culberson Counties, Texas and Eddy and Lea Counties, New Mexico. See DBM acquisition below for further information, including the preliminary allocation of the purchase price. | ||||||||
[6] | WES acquired Anadarko’s interest in Delaware Basin JV Gathering LLC (“DBJV”), which owns a 50% interest in a gathering system and related facilities (the “DBJV system”). The DBJV system is located in the Delaware Basin in Loving, Ward, Winkler and Reeves Counties, Texas. WES will make a cash payment on March 31, 2020, to Anadarko as consideration for the acquisition of DBJV. WES currently estimates the future payment will be $282.8 million, the net present value of which was $174.3 million as of the acquisition date. See DBJV acquisition—Deferred purchase price obligation - Anadarko below. |
Acquisitions and Divestitures33
Acquisitions and Divestitures - Impact to Historical Consolidated Statement of Income Table (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||
Revenues | $ 402,412 | $ 345,569 | [1] | $ 777,506 | $ 639,286 | [1] | ||
Equity income, net | [2],[3] | 18,941 | 13,008 | [1] | 37,161 | [4] | 22,259 | [1],[4] |
Net income | $ 112,546 | 101,881 | [1] | $ 198,512 | 195,677 | [1] | ||
Delaware Basin JV Gathering LLC [Member] | ||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||
Revenues | 15,625 | 29,885 | ||||||
Equity income, net | 0 | 0 | ||||||
Net income | 4,135 | 7,756 | ||||||
WGP Historical [Member] | ||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||
Revenues | 329,944 | 609,401 | ||||||
Equity income, net | 13,008 | 22,259 | ||||||
Net income | $ 97,746 | $ 187,921 | ||||||
[1] | Financial information has been recast to include the financial position and results attributable to the DBJV system. See Note 1 and Note 2. | |||||||
[2] | Income earned from equity investments is classified as affiliate. See Note 1. | |||||||
[3] | Represents amounts earned or incurred on and subsequent to the date of acquisition of WES assets, as well as amounts earned or incurred by Anadarko on a historical basis related to WES assets prior to the acquisition of such assets by WES, recognized under gathering, treating or processing agreements, and purchase and sale agreements. | |||||||
[4] | Income earned on, distributions from and contributions to equity investments are classified as affiliate. See Note 1. |
Acquisitions and Divestitures34
Acquisitions and Divestitures - Purchase Price Allocation Table (Details) - USD ($) $ in Thousands | Jun. 30, 2015 | Dec. 31, 2014 | [1] |
Business Acquisition [Line Items] | |||
Goodwill | $ 393,035 | $ 389,087 | |
Western Gas Partners, LP [Member] | Delaware Basin Midstream LLC [Member] | |||
Business Acquisition [Line Items] | |||
Current assets | 63,020 | ||
Property, plant and equipment | 467,171 | ||
Goodwill | 282,999 | ||
Other intangible assets | 811,048 | ||
Accounts payables | (17,679) | ||
Accrued liabilities | (38,684) | ||
Deferred income taxes | (1,342) | ||
Asset retirement obligations and other | (9,060) | ||
Total purchase price | $ 1,557,473 | ||
[1] | Financial information has been recast to include the financial position and results attributable to the DBJV system. See Note 1 and Note 2. |
Acquisitions and Divestitures35
Acquisitions and Divestitures - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2015 | Jun. 30, 2015 | Mar. 02, 2015 | Dec. 31, 2014 | [2] | ||
Property, Plant and Equipment [Line Items] | ||||||
Deferred purchase price obligation - Anadarko | [1] | $ 179,886 | $ 179,886 | $ 0 | ||
Western Gas Partners, LP [Member] | Delaware Basin Midstream LLC [Member] | ||||||
Property, Plant and Equipment [Line Items] | ||||||
Post-closing purchase price adjustments | 3,500 | |||||
Western Gas Partners, LP [Member] | Dew and Pinnacle Systems [Member] | Assets Held for Sale [Member] | ||||||
Property, Plant and Equipment [Line Items] | ||||||
Current assets - held for sale | 2,200 | 2,200 | ||||
Long-term assets - held for sale | 71,900 | 71,900 | ||||
Current liabilities - held for sale | 4,200 | 4,200 | ||||
Long-term liabilities - held for sale | 3,000 | $ 3,000 | ||||
Western Gas Partners, LP [Member] | Deferred Purchase Price Obligation - Anadarko [Member] | Delaware Basin JV Gathering LLC [Member] | ||||||
Property, Plant and Equipment [Line Items] | ||||||
Deferred purchase price obligation to Anadarko - future value | $ 282,800 | |||||
Deferred purchase price obligation to Anadarko - acquisition date value | [3] | $ 174,276 | ||||
Discount rate percentage | 10.00% | |||||
Deferred purchase price obligation - Anadarko | 179,900 | $ 179,900 | ||||
Interest expense, related party | $ 4,200 | $ 5,600 | ||||
[1] | See Note 2. | |||||
[2] | Financial information has been recast to include the financial position and results attributable to the DBJV system. See Note 1 and Note 2. | |||||
[3] | WES acquired Anadarko’s interest in Delaware Basin JV Gathering LLC (“DBJV”), which owns a 50% interest in a gathering system and related facilities (the “DBJV system”). The DBJV system is located in the Delaware Basin in Loving, Ward, Winkler and Reeves Counties, Texas. WES will make a cash payment on March 31, 2020, to Anadarko as consideration for the acquisition of DBJV. WES currently estimates the future payment will be $282.8 million, the net present value of which was $174.3 million as of the acquisition date. See DBJV acquisition—Deferred purchase price obligation - Anadarko below. |
Partnership Distributions - Cas
Partnership Distributions - Cash Distributions Tables (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | ||||||
Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | ||
Distribution Made to Limited Partner [Line Items] | |||||||
Total quarterly distribution per unit | $ 0.363750 | [1] | $ 0.342500 | $ 0.31250 | $ 0.29125 | $ 0.27125 | $ 0.25000 |
Total quarterly cash distribution | $ 79,630 | [1] | $ 74,977 | $ 68,409 | $ 63,756 | $ 59,378 | $ 54,726 |
Western Gas Partners, LP [Member] | |||||||
Distribution Made to Limited Partner [Line Items] | |||||||
Total quarterly distribution per unit | $ 0.750 | [2] | $ 0.725 | $ 0.700 | $ 0.675 | $ 0.650 | $ 0.625 |
Total quarterly cash distribution | $ 139,736 | [2] | $ 133,203 | $ 126,044 | $ 111,608 | $ 105,655 | $ 98,749 |
[1] | On July 16, 2015, the Board of Directors of WGP GP declared a cash distribution to WGP unitholders of $0.36375 per unit, or $79.6 million in aggregate. The cash distribution is payable on August 21, 2015, to WGP unitholders of record at the close of business on July 31, 2015. | ||||||
[2] | On July 16, 2015, the Board of Directors of WES GP declared a cash distribution to WES unitholders of $0.750 per unit, or $139.7 million in aggregate, including incentive distributions, but excluding distributions on WES Class C units (see WES Class C unit distributions below). The cash distribution is payable on August 12, 2015, to WES unitholders of record at the close of business on July 31, 2015. |
Partnership Distributions - PIK
Partnership Distributions - PIK Class C Units Distributions Table (Details) - Western Gas Partners, LP [Member] - Class C Units [Member] - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2015 | Dec. 31, 2014 | ||
Distribution Made to Limited Partner [Line Items] | |||
PIK Class C units | 118,230 | 45,711 | [1] |
Implied fair value | $ 8,101 | $ 3,072 | [1] |
Table Text Block Supplement [Abstract] | |||
Number of days in prorated period | 37 days | ||
[1] | Prorated for the 37-day period the Class C units were outstanding during the fourth quarter of 2014. |
Partnership Distributions - Add
Partnership Distributions - Additional Information (Details) - 6 months ended Jun. 30, 2015 | Total |
Distribution Made to Limited Partner [Line Items] | |
Partnership agreement day requirement of distribution of available cash | 55 days |
Western Gas Partners, LP [Member] | |
Distribution Made to Limited Partner [Line Items] | |
Partnership agreement day requirement of distribution of available cash | 45 days |
Western Gas Partners, LP [Member] | Class C Units [Member] | |
Distribution Made to Limited Partner [Line Items] | |
Discount rate percentage | 6.00% |
Equity and Partners' Capital -
Equity and Partners' Capital - Equity Offerings Table (Details) - Western Gas Partners, LP [Member] - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Nov. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2015 | Dec. 31, 2014 | Aug. 31, 2014 | Aug. 31, 2012 | ||
Capital Unit [Line Items] | |||||||
Units issued | 163,941 | ||||||
Price per unit | [1] | $ 70.85 | |||||
Underwriting discount and other offering expenses | [1] | $ 18,615 | |||||
Net proceeds to WES | [1] | $ 602,967 | |||||
Table Text Block Supplement [Abstract] | |||||||
General partner's interest | 2.00% | 1.80% | |||||
Option on Securities [Member] | |||||||
Capital Unit [Line Items] | |||||||
Net proceeds to WES | $ 77,000 | ||||||
125 Million COP [Member] | |||||||
Capital Unit [Line Items] | |||||||
Average price per unit | [2] | $ 73.48 | |||||
Underwriting discount and other offering expenses | [2] | $ 1,738 | |||||
Net proceeds to WES | [2] | 83,245 | |||||
Table Text Block Supplement [Abstract] | |||||||
Maximum aggregate principal of common stock | $ 125,000 | ||||||
Gross proceeds | $ 85,000 | ||||||
500 Million COP [Member] | |||||||
Capital Unit [Line Items] | |||||||
Common units issued | 873,525 | ||||||
Average price per unit | [3] | $ 66.61 | |||||
Underwriting discount and other offering expenses | [3] | $ 782 | $ 782 | ||||
Net proceeds to WES | [3] | 57,408 | |||||
Table Text Block Supplement [Abstract] | |||||||
Maximum aggregate principal of common stock | $ 500,000 | ||||||
Gross proceeds | 26,700 | 58,200 | |||||
Commissions paid | $ 300 | $ 600 | |||||
Common Units [Member] | |||||||
Capital Unit [Line Items] | |||||||
Common units issued | [1] | 8,620,153 | |||||
Common Units [Member] | Option on Securities [Member] | |||||||
Capital Unit [Line Items] | |||||||
Common units issued | 1,120,153 | ||||||
Common Units [Member] | 125 Million COP [Member] | |||||||
Capital Unit [Line Items] | |||||||
Common units issued | [2] | 1,133,384 | |||||
Common Units [Member] | 500 Million COP [Member] | |||||||
Capital Unit [Line Items] | |||||||
Common units issued | [3] | 873,525 | |||||
General Partner [Member] | |||||||
Capital Unit [Line Items] | |||||||
Units issued | [1],[4] | 153,061 | |||||
General Partner [Member] | 125 Million COP [Member] | |||||||
Capital Unit [Line Items] | |||||||
Units issued | [2],[4] | 23,132 | |||||
[1] | Includes the issuance of 1,120,153 WES common units pursuant to the partial exercise of the underwriters’ over-allotment option, the net proceeds from which were $77.0 million. Beginning with this partial exercise, WES GP elected not to make a corresponding capital contribution to maintain its 2.0% interest in WES. | ||||||
[2] | Represents common and general partner units of WES issued during the year ended December 31, 2014, pursuant to WES’s registration statement filed with the SEC in August 2012 authorizing the issuance of up to an aggregate of $125.0 million of WES common units (the “$125.0 million COP”). Gross proceeds generated (including WES GP’s proportionate capital contributions) during the year ended December 31, 2014, were $85.0 million. The price per unit in the table above represents an average price for all issuances under the $125.0 million COP during the year ended December 31, 2014. As of December 31, 2014, WES had used all the capacity to issue common units under this registration statement. | ||||||
[3] | Represents common units of WES issued during the six months ended June 30, 2015, pursuant to WES’s registration statement filed with the SEC in August 2014 authorizing the issuance of up to an aggregate of $500.0 million of WES common units (the “$500.0 million COP”). Gross proceeds generated during the three and six months ended June 30, 2015, were $26.7 million and $58.2 million, respectively. Commissions paid during the three and six months ended June 30, 2015, were $0.3 million and $0.6 million, respectively. The price per unit in the table above represents an average price for all issuances under the $500.0 million COP during the six months ended June 30, 2015. | ||||||
[4] | Represents general partner units of WES issued to WES GP in exchange for WES GP’s proportionate capital contribution. |
Equity and Partners' Capital 40
Equity and Partners' Capital - Limited Partner and General Partner Units Table (Details) - Western Gas Partners, LP [Member] - shares | 1 Months Ended | 6 Months Ended | |
Nov. 30, 2014 | Jun. 30, 2015 | ||
Capital Unit [Line Items] | |||
Balance | 141,192,051 | ||
PIK Class C units | 163,941 | ||
Long-Term Incentive Plan award vestings | 5,991 | ||
Balance | 142,235,508 | ||
500 Million COP [Member] | |||
Capital Unit [Line Items] | |||
Offering | 873,525 | ||
Common Units [Member] | |||
Capital Unit [Line Items] | |||
Balance | 127,695,130 | ||
Long-Term Incentive Plan award vestings | 5,991 | ||
Offering | [1] | 8,620,153 | |
Balance | 128,574,646 | ||
Common Units [Member] | 500 Million COP [Member] | |||
Capital Unit [Line Items] | |||
Offering | [2] | 873,525 | |
Class C Units [Member] | |||
Capital Unit [Line Items] | |||
Balance | 10,913,853 | ||
PIK Class C units | 163,941 | ||
Balance | 11,077,794 | ||
General Partner [Member] | |||
Capital Unit [Line Items] | |||
Balance | 2,583,068 | ||
PIK Class C units | [1],[3] | 153,061 | |
Balance | 2,583,068 | ||
[1] | Includes the issuance of 1,120,153 WES common units pursuant to the partial exercise of the underwriters’ over-allotment option, the net proceeds from which were $77.0 million. Beginning with this partial exercise, WES GP elected not to make a corresponding capital contribution to maintain its 2.0% interest in WES. | ||
[2] | Represents common units of WES issued during the six months ended June 30, 2015, pursuant to WES’s registration statement filed with the SEC in August 2014 authorizing the issuance of up to an aggregate of $500.0 million of WES common units (the “$500.0 million COP”). Gross proceeds generated during the three and six months ended June 30, 2015, were $26.7 million and $58.2 million, respectively. Commissions paid during the three and six months ended June 30, 2015, were $0.3 million and $0.6 million, respectively. The price per unit in the table above represents an average price for all issuances under the $500.0 million COP during the six months ended June 30, 2015. | ||
[3] | Represents general partner units of WES issued to WES GP in exchange for WES GP’s proportionate capital contribution. |
Equity and Partners' Capital 41
Equity and Partners' Capital - Additional Information (Details) $ / shares in Units, $ in Millions | 1 Months Ended | 6 Months Ended | ||||
Jun. 30, 2015$ / unitshares | Nov. 30, 2014USD ($)$ / sharesshares | Jul. 31, 2014shares | Jun. 30, 2015$ / unitshares | Dec. 31, 2014shares | ||
Schedule of Investments [Line Items] | ||||||
Limited partner units owned | 218,913,688 | 218,913,688 | 218,909,977 | |||
Anadarko [Member] | ||||||
Schedule of Investments [Line Items] | ||||||
Limited partner units owned | 191,087,365 | 191,087,365 | ||||
Ownership interest | 87.30% | |||||
Anadarko [Member] | Common Units [Member] | ||||||
Schedule of Investments [Line Items] | ||||||
Common units issued | 2,300,000 | 5,750,000 | ||||
Anadarko [Member] | Option on Securities [Member] | Common Units [Member] | ||||||
Schedule of Investments [Line Items] | ||||||
Common units issued | 300,000 | 750,000 | ||||
Anadarko [Member] | Tangible Equity Units [Member] | ||||||
Schedule of Investments [Line Items] | ||||||
Tangible equity units issued | 9,200,000 | |||||
Tangible equity unit rate | 7.50% | 7.50% | ||||
Stated amount per tangible equity unit | $ / unit | 50 | 50 | ||||
Debt instrument, maturity date | Jun. 7, 2018 | |||||
Anadarko [Member] | Tangible Equity Units [Member] | Option on Securities [Member] | ||||||
Schedule of Investments [Line Items] | ||||||
Tangible equity units issued | 1,200,000 | |||||
Public [Member] | ||||||
Schedule of Investments [Line Items] | ||||||
Limited partner units owned | 27,826,323 | 27,826,323 | ||||
Ownership interest | 12.70% | |||||
Western Gas Partners, LP [Member] | ||||||
Schedule of Investments [Line Items] | ||||||
General partner units owned | 2,583,068 | 2,583,068 | ||||
General partner's interest | 2.00% | 1.80% | ||||
Units issued | 163,941 | |||||
Price per unit | $ / shares | [1] | $ 70.85 | ||||
Western Gas Partners, LP [Member] | Common Units [Member] | ||||||
Schedule of Investments [Line Items] | ||||||
Limited partner units owned | 49,296,205 | 49,296,205 | ||||
Ownership interest | 34.70% | |||||
Common units issued | [1] | 8,620,153 | ||||
Western Gas Partners, LP [Member] | Incentive Distribution Rights [Member] | ||||||
Schedule of Investments [Line Items] | ||||||
General partner's interest | 100.00% | |||||
Western Gas Partners, LP [Member] | Class C Units [Member] | ||||||
Schedule of Investments [Line Items] | ||||||
Units issued | 163,941 | |||||
Price per unit | $ / shares | $ 68.72 | |||||
Proceeds from the issuance of Class C units | $ | $ 750 | |||||
Western Gas Partners, LP [Member] | Class C Units [Member] | Maximum [Member] | ||||||
Schedule of Investments [Line Items] | ||||||
Redeemable option on units | $ | $ 150 | |||||
Western Gas Partners, LP [Member] | Option on Securities [Member] | Common Units [Member] | ||||||
Schedule of Investments [Line Items] | ||||||
Common units issued | 1,120,153 | |||||
Western Gas Partners, LP [Member] | Public [Member] | Common Units [Member] | ||||||
Schedule of Investments [Line Items] | ||||||
Limited partner units owned | 78,520,822 | 78,520,822 | ||||
Ownership interest | 55.20% | |||||
Western Gas Partners, LP [Member] | Other Subsidiaries Of Anadarko [Member] | ||||||
Schedule of Investments [Line Items] | ||||||
Ownership interest | 8.30% | |||||
Western Gas Partners, LP [Member] | Other Subsidiaries Of Anadarko [Member] | Common Units [Member] | ||||||
Schedule of Investments [Line Items] | ||||||
Limited partner units owned | 757,619 | 757,619 | ||||
Western Gas Partners, LP [Member] | Other Subsidiaries Of Anadarko [Member] | Class C Units [Member] | ||||||
Schedule of Investments [Line Items] | ||||||
Limited partner units owned | 11,077,794 | 11,077,794 | ||||
Units issued | 10,913,853 | |||||
[1] | Includes the issuance of 1,120,153 WES common units pursuant to the partial exercise of the underwriters’ over-allotment option, the net proceeds from which were $77.0 million. Beginning with this partial exercise, WES GP elected not to make a corresponding capital contribution to maintain its 2.0% interest in WES. |
Transactions with Affiliates -
Transactions with Affiliates - Commodity Price Swap Agreements Table (Details) - Jun. 30, 2015 - Western Gas Partners, LP [Member] | $ / bbl$ / MMBTU |
Ethane [Member] | Year 2016 [Member] | |
Commodity Price Risk Swap [Line Items] | |
Commodity swap fixed price | 23.11 |
Ethane [Member] | Minimum [Member] | Year 2015 [Member] | |
Commodity Price Risk Swap [Line Items] | |
Commodity swap fixed price | 18.41 |
Ethane [Member] | Maximum [Member] | Year 2015 [Member] | |
Commodity Price Risk Swap [Line Items] | |
Commodity swap fixed price | 23.41 |
Propane [Member] | Year 2016 [Member] | |
Commodity Price Risk Swap [Line Items] | |
Commodity swap fixed price | 52.90 |
Propane [Member] | Minimum [Member] | Year 2015 [Member] | |
Commodity Price Risk Swap [Line Items] | |
Commodity swap fixed price | 47.08 |
Propane [Member] | Maximum [Member] | Year 2015 [Member] | |
Commodity Price Risk Swap [Line Items] | |
Commodity swap fixed price | 52.99 |
Isobutane [Member] | Year 2016 [Member] | |
Commodity Price Risk Swap [Line Items] | |
Commodity swap fixed price | 73.89 |
Isobutane [Member] | Minimum [Member] | Year 2015 [Member] | |
Commodity Price Risk Swap [Line Items] | |
Commodity swap fixed price | 62.09 |
Isobutane [Member] | Maximum [Member] | Year 2015 [Member] | |
Commodity Price Risk Swap [Line Items] | |
Commodity swap fixed price | 74.02 |
Normal butane [Member] | Year 2016 [Member] | |
Commodity Price Risk Swap [Line Items] | |
Commodity swap fixed price | 64.93 |
Normal butane [Member] | Minimum [Member] | Year 2015 [Member] | |
Commodity Price Risk Swap [Line Items] | |
Commodity swap fixed price | 54.62 |
Normal butane [Member] | Maximum [Member] | Year 2015 [Member] | |
Commodity Price Risk Swap [Line Items] | |
Commodity swap fixed price | 65.04 |
Natural gasoline [Member] | Year 2016 [Member] | |
Commodity Price Risk Swap [Line Items] | |
Commodity swap fixed price | 81.68 |
Natural gasoline [Member] | Minimum [Member] | Year 2015 [Member] | |
Commodity Price Risk Swap [Line Items] | |
Commodity swap fixed price | 72.88 |
Natural gasoline [Member] | Maximum [Member] | Year 2015 [Member] | |
Commodity Price Risk Swap [Line Items] | |
Commodity swap fixed price | 81.82 |
Condensate [Member] | Year 2016 [Member] | |
Commodity Price Risk Swap [Line Items] | |
Commodity swap fixed price | 81.68 |
Condensate [Member] | Minimum [Member] | Year 2015 [Member] | |
Commodity Price Risk Swap [Line Items] | |
Commodity swap fixed price | 76.47 |
Condensate [Member] | Maximum [Member] | Year 2015 [Member] | |
Commodity Price Risk Swap [Line Items] | |
Commodity swap fixed price | 81.82 |
Natural gas (per MMbtu) [Member] | Year 2016 [Member] | |
Commodity Price Risk Swap [Line Items] | |
Commodity swap fixed price | $ / MMBTU | 4.87 |
Natural gas (per MMbtu) [Member] | Minimum [Member] | Year 2015 [Member] | |
Commodity Price Risk Swap [Line Items] | |
Commodity swap fixed price | $ / MMBTU | 4.66 |
Natural gas (per MMbtu) [Member] | Maximum [Member] | Year 2015 [Member] | |
Commodity Price Risk Swap [Line Items] | |
Commodity swap fixed price | $ / MMBTU | 5.96 |
Transactions with Affiliates 43
Transactions with Affiliates - Gains Losses Commodity Price Swap Agreements Table (Details) - Western Gas Partners, LP [Member] - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | ||
Gains (losses) on commodity price swap agreements related to sales and purchases | |||||
Net gains (losses) on commodity price swap agreements | $ 18,921 | $ 18,038 | $ 40,156 | $ 23,807 | |
Sales [Member] | |||||
Gains (losses) on commodity price swap agreements related to sales and purchases | |||||
Net gains (losses) on commodity price swap agreements | [1] | 60,641 | 36,567 | 116,055 | 42,355 |
Sales [Member] | Natural Gas [Member] | |||||
Gains (losses) on commodity price swap agreements related to sales and purchases | |||||
Net gains (losses) on commodity price swap agreements | [1] | 22,344 | 2,013 | 33,326 | (1,654) |
Sales [Member] | Natural Gas Liquids [Member] | |||||
Gains (losses) on commodity price swap agreements related to sales and purchases | |||||
Net gains (losses) on commodity price swap agreements | [1] | 38,297 | 34,554 | 82,729 | 44,009 |
Cost of Sales [Member] | |||||
Gains (losses) on commodity price swap agreements related to sales and purchases | |||||
Net gains (losses) on commodity price swap agreements | [2] | $ (41,720) | $ (18,529) | $ (75,899) | $ (18,548) |
[1] | Reported in affiliate natural gas, natural gas liquids and drip condensate sales in the consolidated statements of income in the period in which the related sale is recorded. | ||||
[2] | Reported in cost of product in the consolidated statements of income in the period in which the related purchase is recorded. |
Transactions with Affiliates 44
Transactions with Affiliates - Commodity Price Swap Agreements Extensions Table (Details) - Jun. 25, 2015 | $ / bbl$ / MMBTU | |
DJ Basin Complex [Member] | Ethane [Member] | ||
Commodity Price Risk Swap [Line Items] | ||
Commodity Market Price | [1] | 1.96 |
DJ Basin Complex [Member] | Propane [Member] | ||
Commodity Price Risk Swap [Line Items] | ||
Commodity Market Price | [1] | 13.10 |
DJ Basin Complex [Member] | Isobutane [Member] | ||
Commodity Price Risk Swap [Line Items] | ||
Commodity Market Price | [1] | 19.75 |
DJ Basin Complex [Member] | Normal butane [Member] | ||
Commodity Price Risk Swap [Line Items] | ||
Commodity Market Price | [1] | 18.99 |
DJ Basin Complex [Member] | Natural gasoline [Member] | ||
Commodity Price Risk Swap [Line Items] | ||
Commodity Market Price | [1] | 52.59 |
DJ Basin Complex [Member] | Condensate [Member] | ||
Commodity Price Risk Swap [Line Items] | ||
Commodity Market Price | [1] | 52.59 |
DJ Basin Complex [Member] | Natural gas (per MMbtu) [Member] | ||
Commodity Price Risk Swap [Line Items] | ||
Commodity Market Price | $ / MMBTU | [1] | 2.75 |
Hugoton System [Member] | Condensate [Member] | ||
Commodity Price Risk Swap [Line Items] | ||
Commodity Market Price | [1] | 32.56 |
Hugoton System [Member] | Natural gas (per MMbtu) [Member] | ||
Commodity Price Risk Swap [Line Items] | ||
Commodity Market Price | $ / MMBTU | [1] | 2.74 |
Western Gas Partners, LP [Member] | DJ Basin Complex [Member] | Ethane [Member] | Year 2015 [Member] | ||
Commodity Price Risk Swap [Line Items] | ||
Commodity swap fixed price | 18.41 | |
Western Gas Partners, LP [Member] | DJ Basin Complex [Member] | Propane [Member] | Year 2015 [Member] | ||
Commodity Price Risk Swap [Line Items] | ||
Commodity swap fixed price | 47.08 | |
Western Gas Partners, LP [Member] | DJ Basin Complex [Member] | Isobutane [Member] | Year 2015 [Member] | ||
Commodity Price Risk Swap [Line Items] | ||
Commodity swap fixed price | 62.09 | |
Western Gas Partners, LP [Member] | DJ Basin Complex [Member] | Normal butane [Member] | Year 2015 [Member] | ||
Commodity Price Risk Swap [Line Items] | ||
Commodity swap fixed price | 54.62 | |
Western Gas Partners, LP [Member] | DJ Basin Complex [Member] | Natural gasoline [Member] | Year 2015 [Member] | ||
Commodity Price Risk Swap [Line Items] | ||
Commodity swap fixed price | 72.88 | |
Western Gas Partners, LP [Member] | DJ Basin Complex [Member] | Condensate [Member] | Year 2015 [Member] | ||
Commodity Price Risk Swap [Line Items] | ||
Commodity swap fixed price | 76.47 | |
Western Gas Partners, LP [Member] | DJ Basin Complex [Member] | Natural gas (per MMbtu) [Member] | Year 2015 [Member] | ||
Commodity Price Risk Swap [Line Items] | ||
Commodity swap fixed price | $ / MMBTU | 5.96 | |
Western Gas Partners, LP [Member] | Hugoton System [Member] | Condensate [Member] | Year 2015 [Member] | ||
Commodity Price Risk Swap [Line Items] | ||
Commodity swap fixed price | 78.61 | |
Western Gas Partners, LP [Member] | Hugoton System [Member] | Natural gas (per MMbtu) [Member] | Year 2015 [Member] | ||
Commodity Price Risk Swap [Line Items] | ||
Commodity swap fixed price | $ / MMBTU | 5.50 | |
[1] | Represents the New York Mercantile Exchange forward strip price as of June 25, 2015, adjusted for location, basis and, in the case of NGLs, transportation and fractionation costs. |
Transactions with Affiliates 45
Transactions with Affiliates - Equipment Purchases and Sales Table (Details) - USD ($) $ in Thousands | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | ||
Related Party Transaction [Line Items] | |||
Partners’ capital adjustment | $ 4,726 | $ (43) | [1] |
Western Gas Partners, LP [Member] | Affiliates [Member] | Purchases [Member] | |||
Related Party Transaction [Line Items] | |||
Cash consideration - purchases | 9,968 | 4,702 | |
Net carrying value | 4,908 | 4,745 | |
Partners’ capital adjustment | 5,060 | (43) | |
Western Gas Partners, LP [Member] | Affiliates [Member] | Sales [Member] | |||
Related Party Transaction [Line Items] | |||
Cash consideration - sales | 700 | 0 | |
Net carrying value | 366 | 0 | |
Partners’ capital adjustment | $ (334) | $ 0 | |
[1] | Financial information has been recast to include the financial position and results attributable to the DBJV system. See Note 1 and Note 2. |
Transactions with Affiliates 46
Transactions with Affiliates - Summary Table (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |||||
Related Party Transaction [Line Items] | ||||||||
Revenues | $ 402,412 | $ 345,569 | [1] | $ 777,506 | $ 639,286 | [1] | ||
Equity income, net | [2],[3] | 18,941 | 13,008 | [1] | 37,161 | [4] | 22,259 | [1],[4] |
Cost of product | [5] | 146,293 | 120,542 | [1] | 284,213 | 214,918 | [1] | |
Operation and maintenance | [5] | 56,827 | 55,404 | [1] | 112,976 | 99,981 | [1] | |
General and administrative | [5] | 9,442 | 9,202 | [1] | 20,789 | 19,077 | [1] | |
Operating expenses | 287,324 | 237,769 | [1] | 571,555 | 435,916 | [1] | ||
Interest income | [6] | 4,225 | 4,225 | [1] | 8,450 | 8,450 | [1] | |
Interest expense | [7] | 27,604 | 20,864 | [1] | 50,566 | 34,825 | [1] | |
Distributions to unitholders | 143,386 | 105,347 | [1] | |||||
Affiliates [Member] | ||||||||
Related Party Transaction [Line Items] | ||||||||
Revenues | [3] | 259,448 | 266,523 | [1] | 505,163 | 481,519 | [1] | |
Cost of product | [3] | 52,139 | 36,890 | 94,546 | 55,246 | |||
Operation and maintenance | [8] | 17,496 | 16,827 | 32,872 | 29,378 | |||
General and administrative | [9] | 7,513 | 7,090 | 15,279 | 14,572 | |||
Operating expenses | 77,148 | 60,807 | 142,697 | 99,196 | ||||
Interest expense | [10] | 4,190 | 0 | 5,612 | 0 | |||
Affiliates [Member] | Western Gas Equity Partners, LP [Member] | ||||||||
Related Party Transaction [Line Items] | ||||||||
Distributions to unitholders | [11] | 66,235 | 49,784 | 126,669 | 95,835 | |||
Affiliates [Member] | Western Gas Partners, LP [Member] | ||||||||
Related Party Transaction [Line Items] | ||||||||
Distributions to unitholders | [12] | $ 550 | $ 474 | $ 1,080 | $ 743 | |||
[1] | Financial information has been recast to include the financial position and results attributable to the DBJV system. See Note 1 and Note 2. | |||||||
[2] | Income earned from equity investments is classified as affiliate. See Note 1. | |||||||
[3] | Represents amounts earned or incurred on and subsequent to the date of acquisition of WES assets, as well as amounts earned or incurred by Anadarko on a historical basis related to WES assets prior to the acquisition of such assets by WES, recognized under gathering, treating or processing agreements, and purchase and sale agreements. | |||||||
[4] | Income earned on, distributions from and contributions to equity investments are classified as affiliate. See Note 1. | |||||||
[5] | Cost of product includes product purchases from Anadarko (as defined in Note 1) of $52.1 million and $94.5 million for the three and six months ended June 30, 2015, respectively, and $36.9 million and $55.2 million for the three and six months ended June 30, 2014, respectively. Operation and maintenance includes charges from Anadarko of $17.5 million and $32.9 million for the three and six months ended June 30, 2015, respectively, and $16.8 million and $29.4 million for the three and six months ended June 30, 2014, respectively. General and administrative includes charges from Anadarko of $7.5 million and $15.3 million for the three and six months ended June 30, 2015, respectively, and $7.1 million and $14.6 million for the three and six months ended June 30, 2014, respectively. See Note 5. | |||||||
[6] | Represents interest income recognized on the note receivable from Anadarko. | |||||||
[7] | Includes affiliate (as defined in Note 1) interest expense of $4.2 million and $5.6 million for the three and six months ended June 30, 2015, respectively, and zero for each of the three and six months ended June 30, 2014. See Note 2 and Note 9. | |||||||
[8] | Represents expenses incurred on and subsequent to the date of the acquisition of WES assets, as well as expenses incurred by Anadarko on a historical basis related to WES assets prior to the acquisition of such assets by WES. | |||||||
[9] | Represents general and administrative expense incurred on and subsequent to the date of WES’s acquisition of WES assets, as well as a management services fee for reimbursement of expenses incurred by Anadarko for periods prior to the acquisition of WES assets by WES. These amounts include equity-based compensation expense allocated to WES and WGP by Anadarko (see WES LTIP and WGP LTIP and Anadarko Incentive Plans within this Note 5) and amounts charged by Anadarko under the WGP omnibus agreement. | |||||||
[10] | For the three and six months ended June 30, 2015, includes interest expense recognized on the WGP working capital facility (see Note 9) and WES’s accretion expense recognized on the Deferred purchase price obligation - Anadarko for the acquisition of DBJV (see Note 2 and Note 9). | |||||||
[11] | Represents distributions paid under WGP’s partnership agreement (see Note 3 and Note 4). | |||||||
[12] | Represents distributions paid to other subsidiaries of Anadarko under WES’s partnership agreement (see Note 3 and Note 4). |
Transactions with Affiliates 47
Transactions with Affiliates - Additional Information (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||||
May. 31, 2008 | Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | Dec. 31, 2014 | ||
Related Party Transaction [Line Items] | |||||||
Note receivable - Anadarko | $ 260,000,000 | $ 260,000,000 | $ 260,000,000 | [1] | |||
Contributions of equity-based compensation to WES by Anadarko | $ 1,707,000 | ||||||
Western Gas Equity Partners Long Term Incentive Plan [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Units vesting period | 3 years | ||||||
Equity-based compensation expense | 62,000 | $ 25,000 | $ 117,000 | $ 52,000 | |||
Independent Director [Member] | Western Gas Equity Partners Long Term Incentive Plan [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Units vesting period | 1 year | ||||||
Western Gas Partners, LP [Member] | Western Gas Equity Partners Long Term Incentive Plan [Member] | Anadarko Incentive Plans [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Equity-based compensation expense | 1,000,000 | 900,000 | $ 2,000,000 | 1,800,000 | |||
Contributions of equity-based compensation to WES by Anadarko | $ 1,700,000 | ||||||
Western Gas Partners, LP [Member] | Western Gas Partners Long Term Incentive Plan [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Units vesting period | 3 years | ||||||
Equity-based compensation expense | 100,000 | $ 200,000 | $ 200,000 | $ 300,000 | |||
Western Gas Partners, LP [Member] | Independent Director [Member] | Western Gas Partners Long Term Incentive Plan [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Units vesting period | 1 year | ||||||
Western Gas Partners, LP [Member] | Note Receivable from Anadarko [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% | ||||||
Fair value of the note receivable | $ 304,500,000 | $ 304,500,000 | $ 317,800,000 | ||||
Western Gas Partners, LP [Member] | Gathering Transportation and Treating [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Affiliate throughput percent | 47.00% | 50.00% | 47.00% | 49.00% | |||
Western Gas Partners, LP [Member] | Processing [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Affiliate throughput percent | 52.00% | 58.00% | 52.00% | 58.00% | |||
[1] | Financial information has been recast to include the financial position and results attributable to the DBJV system. See Note 1 and Note 2. |
Property, Plant and Equipment -
Property, Plant and Equipment - Historical Cost Table (Details) - USD ($) $ in Thousands | 6 Months Ended | ||
Jun. 30, 2015 | Dec. 31, 2014 | ||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment | $ 5,948,148 | $ 5,626,650 | [1] |
Accumulated depreciation | 1,165,607 | 1,055,207 | [1] |
Net property, plant and equipment | 4,782,541 | 4,571,443 | [1] |
Western Gas Partners, LP [Member] | Land [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment | 3,336 | 2,884 | |
Western Gas Partners, LP [Member] | Gathering Systems [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment | $ 5,527,042 | 4,972,892 | |
Western Gas Partners, LP [Member] | Gathering Systems [Member] | Minimum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful life | 3 years | ||
Western Gas Partners, LP [Member] | Gathering Systems [Member] | Maximum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful life | 47 years | ||
Western Gas Partners, LP [Member] | Pipelines And Equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment | $ 136,303 | 151,107 | |
Western Gas Partners, LP [Member] | Pipelines And Equipment [Member] | Minimum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful life | 15 years | ||
Western Gas Partners, LP [Member] | Pipelines And Equipment [Member] | Maximum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful life | 45 years | ||
Western Gas Partners, LP [Member] | Assets Under Construction [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment | $ 262,334 | 483,347 | |
Western Gas Partners, LP [Member] | Other [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment | $ 19,133 | $ 16,420 | |
Western Gas Partners, LP [Member] | Other [Member] | Minimum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful life | 3 years | ||
Western Gas Partners, LP [Member] | Other [Member] | Maximum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful life | 40 years | ||
[1] | Financial information has been recast to include the financial position and results attributable to the DBJV system. See Note 1 and Note 2. |
Property, Plant and Equipment49
Property, Plant and Equipment - Additional Information (Details) $ in Millions | 6 Months Ended |
Jun. 30, 2015USD ($) | |
Western Gas Partners, LP [Member] | |
Property, Plant and Equipment [Line Items] | |
Impairment | $ 9.5 |
Equity Investments - Equity Inv
Equity Investments - Equity Investments Table (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||||
Jun. 30, 2015 | Jun. 30, 2014 | [4] | Jun. 30, 2015 | Jun. 30, 2014 | [4] | |||
Schedule of Equity Method Investments [Line Items] | ||||||||
Balance | [1] | $ 634,492 | ||||||
Investment earnings (loss), net of amortization | [2],[3] | $ 18,941 | $ 13,008 | 37,161 | [5] | $ 22,259 | [5] | |
Contributions | 6,770 | 60,102 | ||||||
Distributions | [5] | (39,034) | (26,793) | |||||
Distributions in excess of cumulative earnings | [5] | (8,538) | [6] | $ (9,848) | ||||
Balance | 630,851 | 630,851 | ||||||
Western Gas Partners, LP [Member] | Fort Union [Member] | ||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||
Balance | 25,933 | |||||||
Investment earnings (loss), net of amortization | 3,191 | |||||||
Contributions | 0 | |||||||
Distributions | (3,656) | |||||||
Distributions in excess of cumulative earnings | [6] | 0 | ||||||
Balance | 25,468 | 25,468 | ||||||
Western Gas Partners, LP [Member] | White Cliffs [Member] | ||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||
Balance | 44,315 | |||||||
Investment earnings (loss), net of amortization | 7,214 | |||||||
Contributions | 4,370 | |||||||
Distributions | (6,923) | |||||||
Distributions in excess of cumulative earnings | [6] | (2,026) | ||||||
Balance | 46,950 | 46,950 | ||||||
Western Gas Partners, LP [Member] | Rendezvous [Member] | ||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||
Balance | 56,336 | |||||||
Investment earnings (loss), net of amortization | 1,001 | |||||||
Contributions | 0 | |||||||
Distributions | (1,972) | |||||||
Distributions in excess of cumulative earnings | [6] | (1,863) | ||||||
Balance | 53,502 | 53,502 | ||||||
Western Gas Partners, LP [Member] | Mont Belvieu JV [Member] | ||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||
Balance | 121,337 | |||||||
Investment earnings (loss), net of amortization | 11,377 | |||||||
Contributions | (433) | |||||||
Distributions | (12,035) | |||||||
Distributions in excess of cumulative earnings | [6] | (1,025) | ||||||
Balance | 119,221 | 119,221 | ||||||
Western Gas Partners, LP [Member] | Texas Express Gathering LLC [Member] | ||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||
Balance | 16,790 | |||||||
Investment earnings (loss), net of amortization | 231 | |||||||
Contributions | 0 | |||||||
Distributions | (436) | |||||||
Distributions in excess of cumulative earnings | [6] | (80) | ||||||
Balance | 16,505 | 16,505 | ||||||
Western Gas Partners, LP [Member] | Texas Express Pipeline LLC [Member] | ||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||
Balance | 198,793 | |||||||
Investment earnings (loss), net of amortization | 6,818 | |||||||
Contributions | 1,430 | |||||||
Distributions | (6,944) | |||||||
Distributions in excess of cumulative earnings | [6] | (2,798) | ||||||
Balance | 197,299 | 197,299 | ||||||
Western Gas Partners, LP [Member] | Front Range Pipeline LLC [Member] | ||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||
Balance | 170,988 | |||||||
Investment earnings (loss), net of amortization | 7,329 | |||||||
Contributions | 1,403 | |||||||
Distributions | (7,068) | |||||||
Distributions in excess of cumulative earnings | [6] | (746) | ||||||
Balance | $ 171,906 | $ 171,906 | ||||||
[1] | Financial information has been recast to include the financial position and results attributable to the DBJV system. See Note 1 and Note 2. | |||||||
[2] | Income earned from equity investments is classified as affiliate. See Note 1. | |||||||
[3] | Represents amounts earned or incurred on and subsequent to the date of acquisition of WES assets, as well as amounts earned or incurred by Anadarko on a historical basis related to WES assets prior to the acquisition of such assets by WES, recognized under gathering, treating or processing agreements, and purchase and sale agreements. | |||||||
[4] | Financial information has been recast to include the financial position and results attributable to the DBJV system. See Note 1 and Note 2. | |||||||
[5] | Income earned on, distributions from and contributions to equity investments are classified as affiliate. See Note 1. | |||||||
[6] | 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 - Other Current Assets Table (Details) - USD ($) $ in Thousands | Jun. 30, 2015 | Dec. 31, 2014 | ||
Other Current Assets [Line Items] | ||||
Natural gas liquids inventory | $ 6,447 | $ 5,316 | ||
Natural gas imbalance receivables | 1,016 | 415 | ||
Prepaid insurance | 699 | 3,217 | ||
Other | 3,861 | 1,893 | ||
Total other current assets | [1] | $ 12,023 | $ 10,841 | [2] |
[1] | Other current assets includes natural gas imbalance receivables from affiliates of zero and $0.2 million as of June 30, 2015, and December 31, 2014, respectively. | |||
[2] | Financial information has been recast to include the financial position and results attributable to the DBJV system. See Note 1 and Note 2. |
Components of Working Capital52
Components of Working Capital - Accrued Liabilities Table (Details) - USD ($) $ in Thousands | Jun. 30, 2015 | Dec. 31, 2014 | |
Accrued Liabilities [Line Items] | |||
Accrued interest expense | $ 26,071 | $ 24,741 | |
Short-term asset retirement obligations | 4,450 | 1,224 | |
Short-term remediation and reclamation obligations | 475 | 475 | |
Income taxes payable | 416 | 207 | |
Total accrued liabilities | 149,669 | 170,864 | [1] |
Accrued Capital Expenditures [Member] | |||
Accrued Liabilities [Line Items] | |||
Other accrued liabilities | 78,086 | 128,856 | |
Accrued Plant Purchases [Member] | |||
Accrued Liabilities [Line Items] | |||
Other accrued liabilities | 37,928 | 14,023 | |
Other Accrued Liabilities [Member] | |||
Accrued Liabilities [Line Items] | |||
Other accrued liabilities | $ 2,243 | $ 1,338 | |
[1] | Financial information has been recast to include the financial position and results attributable to the DBJV system. See Note 1 and Note 2. |
Debt and Interest Expense - Deb
Debt and Interest Expense - Debt Outstanding Table (Details) - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 | ||
Debt Instrument [Line Items] | ||||
Total long-term debt principal | $ 2,690,000,000 | $ 2,430,000,000 | ||
Carrying value | 2,677,023,000 | 2,422,954,000 | [1] | |
Fair value | [2] | 2,724,274,000 | 2,511,253,000 | |
Anadarko [Member] | ||||
Debt Instrument [Line Items] | ||||
WGP working capital facility - Anadarko | 0 | 1,150,000 | [1] | |
Anadarko [Member] | Working Capital Facility [Member] | ||||
Debt Instrument [Line Items] | ||||
Principal | 0 | 1,150,000 | ||
WGP working capital facility - Anadarko | 0 | 1,150,000 | ||
Fair value | [2] | 0 | 1,150,000 | |
Western Gas Partners, LP [Member] | Revolving Credit Facility [Member] | ||||
Debt Instrument [Line Items] | ||||
Principal | 270,000,000 | 510,000,000 | ||
Carrying value | 270,000,000 | 510,000,000 | ||
Fair value | [2] | 270,000,000 | 510,000,000 | |
Western Gas Partners, LP [Member] | Senior Notes [Member] | 5.375% Senior Notes due 2021 [Member] | ||||
Debt Instrument [Line Items] | ||||
Principal | 500,000,000 | 500,000,000 | ||
Carrying value | 495,995,000 | 495,714,000 | ||
Fair value | [2] | 544,930,000 | 549,530,000 | |
Western Gas Partners, LP [Member] | Senior Notes [Member] | 4.000% Senior Notes due 2022 [Member] | ||||
Debt Instrument [Line Items] | ||||
Principal | 670,000,000 | 670,000,000 | ||
Carrying value | 672,752,000 | 672,930,000 | ||
Fair value | [2] | 673,994,000 | 681,942,000 | |
Western Gas Partners, LP [Member] | Senior Notes [Member] | 2.600% Senior Notes due 2018 [Member] | ||||
Debt Instrument [Line Items] | ||||
Principal | 350,000,000 | 350,000,000 | ||
Carrying value | 350,412,000 | 350,474,000 | ||
Fair value | [2] | 352,497,000 | 352,162,000 | |
Western Gas Partners, LP [Member] | Senior Notes [Member] | 5.450% Senior Notes due 2044 [Member] | ||||
Debt Instrument [Line Items] | ||||
Principal | 400,000,000 | 400,000,000 | ||
Carrying value | 393,879,000 | 393,836,000 | ||
Fair value | [2] | 400,692,000 | 417,619,000 | |
Western Gas Partners, LP [Member] | Senior Notes [Member] | 3.950% Senior Notes due 2025 [Member] | ||||
Debt Instrument [Line Items] | ||||
Principal | 500,000,000 | 0 | ||
Carrying value | 493,985,000 | 0 | ||
Fair value | [2] | $ 482,161,000 | $ 0 | |
[1] | Financial information has been recast to include the financial position and results attributable to the DBJV system. See Note 1 and Note 2. | |||
[2] | Fair value is measured using Level 2 inputs. |
Debt and Interest Expense - D54
Debt and Interest Expense - Debt Activity Table (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2015USD ($) | |
Debt Instrument [Line Items] | |
Beginning balance | $ 2,424,104 |
Ending balance | 2,677,023 |
Working Capital Facility [Member] | Anadarko [Member] | |
Debt Instrument [Line Items] | |
Repayments | (1,150) |
Western Gas Partners, LP [Member] | |
Debt Instrument [Line Items] | |
Other | (5,931) |
Western Gas Partners, LP [Member] | Revolving Credit Facility [Member] | |
Debt Instrument [Line Items] | |
Borrowings | 280,000 |
Repayments | (520,000) |
Western Gas Partners, LP [Member] | Senior Notes [Member] | 3.950% Senior Notes due 2025 [Member] | |
Debt Instrument [Line Items] | |
Issuance of Senior Notes | $ 500,000 |
Debt and Interest Expense - Int
Debt and Interest Expense - Interest Expense Table (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | ||||
Debt Instrument [Line Items] | |||||||
Interest expense | [1] | $ 27,604 | $ 20,864 | [2] | $ 50,566 | $ 34,825 | [2] |
Third Parties [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest expense | 23,414 | 20,864 | 44,954 | 34,825 | |||
Affiliates [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest expense | [3] | 4,190 | 0 | 5,612 | 0 | ||
Anadarko [Member] | Working Capital Facility [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest expense, related party | 0 | 0 | 2 | 0 | |||
Western Gas Partners, LP [Member] | Third Parties [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Long-term debt | 24,733 | 21,445 | 48,075 | 37,580 | |||
Amortization of debt issuance costs and commitment fees | 1,374 | 1,426 | 2,666 | 2,692 | |||
Capitalized interest | (2,693) | (2,007) | (5,787) | (5,447) | |||
Western Gas Partners, LP [Member] | Affiliates [Member] | Deferred Purchase Price Obligation - Anadarko [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest expense, related party | [4] | $ 4,190 | $ 0 | $ 5,610 | $ 0 | ||
[1] | Includes affiliate (as defined in Note 1) interest expense of $4.2 million and $5.6 million for the three and six months ended June 30, 2015, respectively, and zero for each of the three and six months ended June 30, 2014. See Note 2 and Note 9. | ||||||
[2] | Financial information has been recast to include the financial position and results attributable to the DBJV system. See Note 1 and Note 2. | ||||||
[3] | For the three and six months ended June 30, 2015, includes interest expense recognized on the WGP working capital facility (see Note 9) and WES’s accretion expense recognized on the Deferred purchase price obligation - Anadarko for the acquisition of DBJV (see Note 2 and Note 9). | ||||||
[4] | See Note 2 for a discussion of the accretion and present value of the Deferred purchase price obligation - Anadarko. |
Debt and Interest Expense - Add
Debt and Interest Expense - Additional Information (Details) - USD ($) | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Nov. 01, 2012 | |
Working Capital Facility [Member] | Anadarko [Member] | |||
Debt Instrument [Line Items] | |||
Facility, interest rate at period end | 1.69% | 1.66% | |
Facility, outstanding borrowings | $ 0 | ||
Facility, available borrowing capacity | $ 30,000,000 | ||
Facility, maximum borrowing capacity | $ 30,000,000 | ||
Facility, expiration date | Nov. 1, 2017 | ||
Western Gas Partners, LP [Member] | Revolving Credit Facility [Member] | |||
Debt Instrument [Line Items] | |||
Facility, interest rate at period end | 1.49% | 1.46% | |
Facility, fee rate | 0.20% | 0.20% | |
Facility, outstanding borrowings | $ 270,000,000 | ||
Outstanding letters of credit | 12,800,000 | ||
Facility, available borrowing capacity | $ 917,200,000 | ||
Facility, expiration date | Feb. 26, 2019 | ||
Western Gas Partners, LP [Member] | 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 | ||
Western Gas Partners, LP [Member] | 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 | ||
Western Gas Partners, LP [Member] | 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 | ||
Western Gas Partners, LP [Member] | 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 | ||
Western Gas Partners, LP [Member] | Senior Notes [Member] | 3.950% Senior Notes due 2025 [Member] | |||
Debt Instrument [Line Items] | |||
Fixed interest rate | 3.95% | ||
Offering Percent | 98.789% | ||
Effective interest rate | 4.205% | ||
Underwriting discount | $ 3,300,000 | ||
Debt instrument, maturity date | Jun. 1, 2025 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) - Western Gas Partners, LP [Member] - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Loss Contingencies [Line Items] | ||||
Committed capital | $ 52.3 | $ 52.3 | ||
Rent expense associated with office, warehouse and equipment leases | $ 4.5 | $ 2 | $ 8.7 | $ 4.3 |