Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | |||
Sep. 30, 2013 | Oct. 31, 2013 | Oct. 31, 2013 | Oct. 31, 2013 | |
Common units | Subordinated Units | General Partner Units | ||
Entity Registrant Name | 'Summit Midstream Partners, LP | ' | ' | ' |
Entity Central Index Key | '0001549922 | ' | ' | ' |
Document Type | '10-Q | ' | ' | ' |
Document Period End Date | 30-Sep-13 | ' | ' | ' |
Amendment Flag | 'false | ' | ' | ' |
Current Fiscal Year End Date | '--12-31 | ' | ' | ' |
Entity Current Reporting Status | 'Yes | ' | ' | ' |
Entity Filer Category | 'Non-accelerated Filer | ' | ' | ' |
Entity Common Stock, Shares Outstanding | ' | 29,079,866 | 24,409,850 | 1,091,453 |
Document Fiscal Year Focus | '2013 | ' | ' | ' |
Document Fiscal Period Focus | 'Q3 | ' | ' | ' |
UNAUDITED_CONDENSED_CONSOLIDAT
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | $15,283 | $7,895 |
Accounts receivable | 34,911 | 33,504 |
Due from affiliate | 0 | 774 |
Other assets | 2,354 | 2,190 |
Total current assets | 52,548 | 44,363 |
Property, plant and equipment, net | 957,555 | 681,993 |
Intangible assets, net: | ' | ' |
Favorable gas gathering contracts | 18,348 | 19,958 |
Contract intangibles | 394,804 | 229,596 |
Rights-of-way | 51,657 | 35,986 |
Total intangible assets, net | 464,809 | 285,540 |
Goodwill | 117,766 | 45,478 |
Other noncurrent assets | 12,417 | 6,137 |
Total assets | 1,605,095 | 1,063,511 |
Current liabilities: | ' | ' |
Trade accounts payable | 11,909 | 15,817 |
Due to affiliate | 430 | 0 |
Deferred revenue | 1,555 | 865 |
Ad valorem taxes payable | 5,604 | 5,455 |
Interest Payable, Current | 6,525 | 16 |
Other current liabilities | 7,620 | 4,308 |
Total current liabilities | 33,643 | 26,461 |
Long-term debt | 565,050 | 199,230 |
Noncurrent liability, net (Note 4) | 6,604 | 7,420 |
Deferred revenue | 22,560 | 10,899 |
Other noncurrent liabilities | 361 | 254 |
Total liabilities | 628,218 | 244,264 |
Commitments and contingencies (Note 11) | ' | ' |
Common limited partner capital (29,075,447 units issued and outstanding at September 30, 2013 and 24,412,427 units issued and outstanding at December 31, 2012) | 570,260 | 418,856 |
Subordinated limited partner capital (24,409,850 units issued and outstanding at September 30, 2013 and December 31, 2012) | 383,281 | 380,169 |
General partner interests (1,091,453 units issued and outstanding at September 30, 2013 and 996,320 issued and outstanding at December 31, 2012) | 23,336 | 20,222 |
Total partners' capital | 976,877 | 819,247 |
Total liabilities and partners' capital | $1,605,095 | $1,063,511 |
UNAUDITED_CONDENSED_CONSOLIDAT1
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) | Sep. 30, 2013 | Dec. 31, 2012 |
Statement of Financial Position [Abstract] | ' | ' |
Common limited partner capital, units issued | 29,073,974 | 24,412,427 |
Common limited partner capital, units outstanding | 29,073,974 | 24,412,427 |
Subordinated limited partner capital, units issued | 24,409,850 | 24,409,850 |
Subordinated limited partner capital, units outstanding | 24,409,850 | 24,409,850 |
General partner interests, units issued | 1,091,453 | 996,320 |
General partner interests, units outstanding | 1,091,453 | 996,320 |
UNAUDITED_CONDENSED_CONSOLIDAT2
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Revenues: | ' | ' | ' | ' |
Gathering services and other fees | $45,968 | $37,903 | $127,098 | $106,550 |
Natural gas, NGLs and condensate sales and other | 17,392 | 3,232 | 47,204 | 10,290 |
Amortization of favorable and unfavorable contracts | -264 | -160 | -794 | 25 |
Total revenues | 63,096 | 40,975 | 173,508 | 116,865 |
Costs and expenses: | ' | ' | ' | ' |
Operation and maintenance | 15,918 | 14,460 | 45,467 | 37,177 |
Cost of natural gas and NGLs | 10,464 | 0 | 24,328 | 0 |
General and administrative | 6,248 | 5,179 | 18,198 | 15,977 |
Transaction costs | 123 | 1,739 | 2,549 | 1,972 |
Depreciation and amortization | 16,426 | 9,156 | 43,146 | 26,135 |
Total costs and expenses | 49,179 | 30,534 | 133,688 | 81,261 |
Other (expense) income | -112 | 2 | -110 | 8 |
Interest expense | -6,937 | -2,827 | -11,840 | -5,573 |
Affiliated interest expense | 0 | -13 | 0 | -5,426 |
Income before income taxes | 6,868 | 7,603 | 27,870 | 24,613 |
Income tax expense | -177 | -207 | -579 | -501 |
Net income | 6,691 | 7,396 | 27,291 | 24,112 |
Less: net income attributable to SMP Holdings (Note 1) | 0 | ' | 52 | ' |
Net income attributable to partners | 6,691 | ' | 27,239 | ' |
Less: net income attributable to general partner | 134 | ' | 545 | ' |
Net income attributable to limited partners | $6,557 | ' | $26,694 | ' |
Earnings per common unit b basic (in dollars per unit) | $0.12 | ' | $0.57 | ' |
Earnings per common unit b diluted (in dollars per unit) | $0.12 | ' | $0.57 | ' |
Earnings per subordinated unit b basic and diluted (in dollars per unit) | $0.12 | ' | $0.48 | ' |
Weighted-average common units outstanding b basic (in units) | 29,074,743 | ' | 26,234,042 | ' |
Weighted-average common units outstanding b diluted (in units) | 29,227,041 | ' | 26,352,234 | ' |
Weighted-average subordinated units outstanding b basic and diluted (in units) | 24,409,850 | ' | 24,409,850 | ' |
Cash distributions declared per common unit (in dollars per unit) | $0.44 | ' | $1.26 | ' |
UNAUDITED_CONDENSED_CONSOLIDAT3
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF PARTNERS' CAPITAL AND MEMBERSHIP INTERESTS (USD $) | Total | Bison Midstream | Mountaineer Midstream | SMLP units | Class B Units | SMP Holdings' equity in Bison Midstream | SMP Holdings' equity in Bison Midstream | SMP Holdings' equity in Bison Midstream | SMP Holdings' equity in Bison Midstream | SMP Holdings' equity in Bison Midstream | Membership interests | Membership interests | Membership interests | Membership interests | Membership interests | Limited partners, Common | Limited partners, Common | Limited partners, Common | Limited partners, Common | Limited partners, Subordinated | Limited partners, Subordinated | Limited partners, Subordinated | Limited partners, Subordinated | Limited partners, Subordinated | General partner | General partner | General partner | General partner | General partner |
In Thousands, unless otherwise specified | Bison Midstream | Mountaineer Midstream | SMLP units | Class B Units | Bison Midstream | Mountaineer Midstream | SMLP units | Class B Units | Bison Midstream | SMLP units | Class B Units | Bison Midstream | Mountaineer Midstream | SMLP units | Class B Units | Bison Midstream | Mountaineer Midstream | SMLP units | Class B Units | ||||||||||
Beginning balance at Dec. 31, 2011 | $640,818 | ' | ' | ' | ' | $0 | ' | ' | ' | ' | $640,818 | ' | ' | ' | ' | $0 | ' | ' | ' | $0 | ' | ' | ' | ' | $0 | ' | ' | ' | ' |
Members Interest Increase (Decrease) Abstract | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income | 24,112 | ' | ' | ' | ' | 0 | ' | ' | ' | ' | 24,112 | ' | ' | ' | ' | 0 | ' | ' | ' | 0 | ' | ' | ' | ' | 0 | ' | ' | ' | ' |
Unit-based compensation | ' | ' | ' | ' | 1,793 | ' | ' | ' | ' | 0 | ' | ' | ' | ' | 1,793 | ' | ' | ' | 0 | ' | ' | ' | ' | 0 | ' | ' | ' | ' | 0 |
Contribution of net assets from SMP Holdings in excess of consideration paid for Bison Midstream | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Ending balance at Sep. 30, 2012 | 666,723 | ' | ' | ' | ' | 0 | ' | ' | ' | ' | 666,723 | ' | ' | ' | ' | 0 | ' | ' | ' | 0 | ' | ' | ' | ' | 0 | ' | ' | ' | ' |
Beginning balance at Dec. 31, 2012 | 819,247 | ' | ' | ' | ' | 0 | ' | ' | ' | ' | 0 | ' | ' | ' | ' | 418,856 | ' | ' | ' | 380,169 | ' | ' | ' | ' | 20,222 | ' | ' | ' | ' |
Members Interest Increase (Decrease) Abstract | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income | 27,291 | ' | ' | ' | ' | 52 | ' | ' | ' | ' | 0 | ' | ' | ' | ' | 13,691 | ' | ' | ' | 13,003 | ' | ' | ' | ' | 545 | ' | ' | ' | ' |
Unit-based compensation | ' | ' | ' | 1,970 | 17 | ' | ' | ' | 0 | 0 | ' | ' | ' | 0 | 0 | ' | ' | 1,970 | 17 | ' | ' | ' | 0 | 0 | ' | ' | ' | 0 | 0 |
Repurchase of DFW Net Profits Interests | -11,957 | ' | ' | ' | ' | 0 | ' | ' | ' | ' | 0 | ' | ' | ' | ' | -5,859 | ' | ' | ' | -5,859 | ' | ' | ' | ' | -239 | ' | ' | ' | ' |
Consolidation of Bison Midstream net assets | ' | 303,168 | ' | ' | ' | ' | 303,168 | ' | ' | ' | ' | 0 | ' | ' | ' | ' | 0 | ' | ' | ' | 0 | ' | ' | ' | ' | 0 | ' | ' | ' |
Contribution from SMP Holdings to Bison Midstream | ' | 2,229 | ' | ' | ' | ' | 2,229 | ' | ' | ' | ' | 0 | ' | ' | ' | ' | 0 | ' | ' | ' | 0 | ' | ' | ' | ' | 0 | ' | ' | ' |
Units issued to acquire entity | ' | -200,000 | 100,000 | ' | ' | ' | -248,914 | 0 | ' | ' | ' | 0 | 0 | ' | ' | ' | 47,936 | ' | ' | ' | 0 | 0 | ' | ' | ' | 978 | 2,000 | ' | ' |
Contribution of net assets from SMP Holdings in excess of consideration paid for Bison Midstream | 56,535 | 0 | ' | ' | ' | ' | -56,535 | ' | ' | ' | ' | 0 | ' | ' | ' | ' | 28,558 | ' | ' | ' | 26,846 | ' | ' | ' | ' | 1,131 | ' | ' | ' |
Distributions to unitholders | -65,088 | ' | ' | ' | ' | 0 | ' | ' | ' | ' | 0 | ' | ' | ' | ' | -32,909 | ' | ' | ' | -30,878 | ' | ' | ' | ' | -1,301 | ' | ' | ' | ' |
Ending balance at Sep. 30, 2013 | $976,877 | ' | ' | ' | ' | $0 | ' | ' | ' | ' | $0 | ' | ' | ' | ' | $570,260 | ' | ' | ' | $383,281 | ' | ' | ' | ' | $23,336 | ' | ' | ' | ' |
UNAUDITED_CONDENSED_CONSOLIDAT4
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Cash flows from operating activities: | ' | ' |
Net income | $27,291 | $24,112 |
Adjustments to reconcile net income to cash provided by operating activities: | ' | ' |
Depreciation and amortization | 43,146 | 26,135 |
Amortization of favorable and unfavorable contracts | 794 | -25 |
Amortization of deferred loan costs | 1,591 | 1,018 |
Unit-based compensation | 1,987 | 1,793 |
Loss on asset sales | 113 | 0 |
Loss on asset sales | 0 | 5,426 |
Changes in operating assets and liabilities: | ' | ' |
Accounts receivable | 4,198 | 1,522 |
Due to/from affiliate | 1,204 | 0 |
Other assets | -147 | -286 |
Trade accounts payable | -563 | -5,250 |
Change in deferred revenue | 9,561 | 7,585 |
Ad valorem taxes payable | 64 | 4,050 |
Accrued interest | 6,509 | -396 |
Other current liabilities | 51 | 2,224 |
Other noncurrrent liabilities | 107 | 0 |
Net cash provided by operating activities | 95,906 | 67,908 |
Cash flows from investing activities: | ' | ' |
Capital expenditures | 62,317 | 60,647 |
Proceeds from asset sales | 585 | 0 |
Net cash used in investing activities | -471,732 | -60,647 |
Cash flows from financing activities: | ' | ' |
Distributions to unitholders | -65,088 | 0 |
Borrowings under revolving credit facility | 360,000 | 213,000 |
Repayments of Lines of Credit | -294,180 | -15,770 |
Proceeds from Issuance of Senior Long-term Debt | 300,000 | 0 |
Proceeds from Other Equity | 2,229 | 0 |
Proceeds from Issuance of Common Limited Partners Units | 100,000 | 0 |
Repurchase of DFW Net Profits Interests | -11,957 | 0 |
Deferred loan costs and initial public offering costs | -7,790 | -5,976 |
Repayments of Notes Payable | 0 | -209,230 |
Net cash provided by (used in) financing activities | 383,214 | -17,976 |
Net change in cash and cash equivalents | 7,388 | -10,715 |
Cash and cash equivalents, beginning of period | 7,895 | 15,462 |
Cash and cash equivalents, end of period | 15,283 | 4,747 |
Supplemental Schedule of Investing and Financing Activities: | ' | ' |
Cash interest paid | 6,548 | 6,274 |
Capitalized interest | 2,808 | 2,191 |
Interest paid (net of capitalized interest) | 3,740 | 4,083 |
Cash paid for taxes | 660 | 650 |
SUPPLEMENTAL DISCLOSURES OF NONCASH INVESTING AND FINANCING ACTIVITIES | ' | ' |
Capital expenditures in accounts payable (period end accruals) | 2,592 | 3,682 |
Unit-based compensation | 1,987 | 1,793 |
Issuance of units to partially fund the Bison Drop Down | 48,914 | 0 |
Contribution of net assets from SMP Holdings in excess of consideration paid for Bison Midstream | 56,535 | 0 |
Pay-in-kind interest on promissory notes payable to Sponsors | 0 | 6,337 |
Deferred Initial Public Offering Costs Incurred but not Yet Paid | 0 | 1,531 |
Bison Midstream | ' | ' |
Cash flows from investing activities: | ' | ' |
Acquisition of productive assets | -200,000 | 0 |
SUPPLEMENTAL DISCLOSURES OF NONCASH INVESTING AND FINANCING ACTIVITIES | ' | ' |
Contribution of net assets from SMP Holdings in excess of consideration paid for Bison Midstream | 0 | ' |
Mountaineer Midstream | ' | ' |
Cash flows from investing activities: | ' | ' |
Acquisition of productive assets | ($210,000) | $0 |
ORGANIZATION_AND_BUSINESS_OPER
ORGANIZATION AND BUSINESS OPERATIONS | 9 Months Ended | |
Sep. 30, 2013 | ||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' | |
ORGANIZATION AND BUSINESS OPERATIONS | ' | |
ORGANIZATION, BUSINESS OPERATIONS AND BASIS OF PRESENTATION | ||
Organization. Summit Midstream Partners, LP ("SMLP" or the "Partnership"), a Delaware limited partnership, was formed in May 2012 and began operations in October 2012 in connection with its initial public offering ("IPO") of common limited partner units. SMLP is a growth-oriented limited partnership focused on owning and operating midstream energy infrastructure assets that are strategically located in the core producing areas of unconventional resource basins, primarily shale formations, in North America. | ||
Effective with the completion of its IPO on October 3, 2012, SMLP has a 100% ownership interest in Summit Midstream Holdings, LLC ("Summit Holdings") which has a 100% ownership interest in both DFW Midstream Services LLC ("DFW Midstream") and Grand River Gathering, LLC ("Grand River Gathering"). The effects of the IPO and related equity transfers occurring in October 2012 are reflected in SMLP's financial statements. For additional information, see Note 1 to the audited consolidated financial statements included in our annual report on Form 10-K for the year ended December 31, 2012 (the "2012 Annual Report"). | ||
On June 4, 2013, Summit Holdings acquired all of the membership interests of Bison Midstream, LLC ("Bison Midstream") from Summit Midstream Partners Holdings, LLC ("SMP Holdings"), a wholly owned direct subsidiary of Summit Midstream Partners, LLC ("Summit Investments") (the "Bison Drop Down"), and thereby acquired certain associated natural gas gathering pipeline, dehydration and compression assets in the Bakken Shale Play in Mountrail and Burke counties in North Dakota (the "Bison Gas Gathering system"). | ||
Prior to the Bison Drop Down, on February 15, 2013, Summit Investments acquired Bear Tracker Energy, LLC ("BTE") and subsequently contributed it to SMP Holdings. The Bison Gas Gathering system was carved out from BTE in connection with the Bison Drop Down. As such, it was deemed a transaction among entities under common control. For additional information, see Notes 5, 6 and 12. | ||
On June 21, 2013, Mountaineer Midstream Company, LLC ("Mountaineer Midstream"), a newly formed, wholly owned subsidiary of Summit Holdings, acquired certain natural gas gathering pipeline and compression assets in the Marcellus Shale Play in Doddridge County, West Virginia from an affiliate of MarkWest Energy Partners, L.P. ("MarkWest") (the "Mountaineer Acquisition"). For additional information, see Notes 5, 6 and 12. | ||
Summit Investments is a Delaware limited liability company and the predecessor for accounting purposes (the "Predecessor") of SMLP. Summit Investments was formed and began operations in September 2009. Through August 2011, Summit Investments was wholly owned by Energy Capital Partners II, LLC and its parallel and co-investment funds (collectively, "Energy Capital Partners"). In August 2011, Energy Capital Partners sold an interest in Summit Investments to a subsidiary of GE Energy Financial Services, Inc. ("GE Energy Financial Services", and collectively with Energy Capital Partners, the "Sponsors"). In March 2013, Summit Investments contributed the ownership of its SMLP common and subordinated units along with its 2% general partner interest in SMLP to SMP Holdings in exchange for a continuing 100% interest in SMP Holdings. As of September 30, 2013, SMP Holdings held 14,691,397 SMLP common units, 24,409,850 SMLP subordinated units and 1,091,453 general partner units representing a 2% general partner interest in SMLP. | ||
SMLP is managed and operated by the board of directors and executive officers of Summit Midstream GP, LLC (the "general partner"). Summit Investments, as the ultimate owner of our general partner, has the right to appoint the entire board of directors of our general partner, including our independent directors. SMLP's operations are conducted through, and our operating assets are owned by, various operating subsidiaries. However, neither SMLP nor its subsidiaries has any employees. The general partner has the sole responsibility for providing the personnel necessary to conduct SMLP's operations, whether through directly hiring employees or by obtaining the services of personnel employed by others, including Summit Investments. All of the personnel that conduct SMLP's business are employed by the general partner and its affiliates, but these individuals are sometimes referred to as our employees. | ||
References to the "Company," "we," or "our," when used for dates or periods ended on or after the IPO, refer collectively to SMLP and its subsidiaries. References to the "Company," "we," or "our," when used for dates or periods ended prior to the IPO, refer collectively to Summit Investments and its subsidiaries. | ||
Business Operations. We provide natural gas gathering and compression services pursuant to long-term, primarily fee-based, natural gas gathering agreements with our customers. Our results are driven primarily by the volumes of natural gas that we gather and compress across our systems. We currently operate in the following unconventional resource basins: | ||
• | the Piceance Basin, which includes the Mesaverde formation and the Mancos and Niobrara shale formations in western Colorado; | |
• | the Fort Worth Basin, which includes the Barnett Shale formation in north-central Texas; | |
• | the Williston Basin, which includes the Bakken and Three Forks shale formations in northwestern North Dakota; and | |
• | the Appalachian Basin, which includes the Marcellus Shale formation in northern West Virginia. | |
Our operating subsidiaries are Grand River Gathering, DFW Midstream, Bison Midstream and Mountaineer Midstream. All of our operating subsidiaries are midstream energy companies focused on the development, construction and operation of natural gas gathering systems. | ||
Basis of Presentation and Principles of Consolidation. We prepare our unaudited condensed consolidated financial statements in accordance with accounting principles generally accepted in the United States of America ("GAAP"). These principles are established by the Financial Accounting Standards Board. We make estimates and assumptions that affect the reported amounts of assets and liabilities at the balance sheet dates, including fair value measurements, the reported amounts of revenue and expense, and the disclosure of contingencies. Although management believes these estimates are reasonable, actual results could differ from its estimates. | ||
For the purposes of the unaudited condensed consolidated financial statements, SMLP's results of operations reflect the Partnership's operations subsequent to the IPO and the results of the Predecessor for the period prior to the IPO. The unaudited condensed consolidated financial statements also reflect the results of operations of: (i) Bison Midstream since February 16, 2013 and (ii) Mountaineer Midstream since June 22, 2013. Because the Bison Drop Down was executed between entities under common control, SMLP recognized the acquisition of Bison Midstream at SMP Holdings' historical cost which reflected its fair value accounting for the acquisition of BTE. The excess of SMP Holdings' net investment in Bison Midstream over the purchase price paid by SMLP was recognized as an addition to partners' capital. Due to the common control aspect, the Bison Drop Down was accounted for by the Partnership on an “as if pooled” basis for all periods in which common control existed. See Notes 5, 6 and 12 for additional information. The unaudited condensed consolidated financial statements include the assets, liabilities, and results of operations of SMLP or the Predecessor and their respective wholly owned subsidiaries. All intercompany transactions among the consolidated entities have been eliminated. In our opinion, the accompanying unaudited condensed consolidated financial statements include all adjustments consisting of normal recurring accruals necessary for a fair presentation of the results of operations for the three and nine months ended September 30, 2013 and 2012. | ||
These unaudited condensed consolidated financial statements have been prepared pursuant to the rules and the regulations of the Securities and Exchange Commission (the "SEC"). Certain information and note disclosures normally included in annual financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to those rules and regulations, although the Partnership believes that the disclosures made are adequate to make the information not misleading. The unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto that are included in our 2012 Annual Report. The results of operations for an interim period are not necessarily indicative of results expected for a full year. | ||
We conduct our operations in the midstream sector with four operating segments. However, due to their similar characteristics and how we manage our business, we have aggregated these segments into one reportable operating segment for disclosure purposes. The assets of our reportable operating segment consist of natural gas gathering systems and related plant and equipment. Our operating segments reflect the way in which we internally report the financial information used to make decisions and allocate resources in connection with our operations. | ||
Reclassifications. Certain reclassifications have been made to prior-year amounts to conform to current-year presentation. These reclassifications had no impact on net income or total partners' capital or membership interests. |
SUMMARY_OF_SIGNIFICANT_ACCOUNT
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Accounting Policies [Abstract] | ' | |||||||||||||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' | |||||||||||||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||||||||||||||||
Fair Value of Financial Instruments. The carrying amount of cash and cash equivalents (Level 1), accounts receivable, and accounts payable reported on the balance sheet approximates fair value due to their short-term maturities. | ||||||||||||||||
GAAP's fair-value-measurement standard defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The standard characterizes inputs used in determining fair value according to a hierarchy that prioritizes those inputs based upon the degree to which they are observable. The three levels of the fair value hierarchy are as follows: | ||||||||||||||||
• | Level 1. Inputs represent quoted prices in active markets for identical assets or liabilities; | |||||||||||||||
• | Level 2. Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly (for example, quoted market prices for similar assets or liabilities in active markets or quoted market prices for identical assets or liabilities in markets not considered to be active, inputs other than quoted prices that are observable for the asset or liability, or market-corroborated inputs); and | |||||||||||||||
• | Level 3. Inputs that are not observable from objective sources, such as management’s internally developed assumptions used in pricing an asset or liability (for example, an estimate of future cash flows used in management’s internally developed present value of future cash flows model that underlies the fair value measurement). | |||||||||||||||
Nonfinancial assets and liabilities initially measured at fair value include those acquired and assumed in connection with third-party business combinations. | ||||||||||||||||
A summary of the estimated fair value for financial instruments follows. | ||||||||||||||||
September 30, 2013 | December 31, 2012 | |||||||||||||||
Carrying value | Estimated | Carrying value | Estimated | |||||||||||||
fair value (Level 2) | fair value (Level 2) | |||||||||||||||
(In thousands) | ||||||||||||||||
Revolving credit facility | $ | 265,050 | $ | 265,050 | $ | 199,230 | $ | 199,230 | ||||||||
Senior notes | 300,000 | 308,500 | — | — | ||||||||||||
The revolving credit facility’s carrying value on the balance sheet is its fair value due to its floating interest rate. The fair value for the senior notes is based on an average of nonbinding broker quotes as of September 30, 2013. The use of different market assumptions or valuation methodologies may have a material effect on the estimated fair value of the senior notes. | ||||||||||||||||
Intangible Assets and Noncurrent Liability. Upon the acquisition of DFW Midstream, certain of our gas gathering contracts were deemed to have above-market pricing structures while another was deemed to have pricing that was below market. We have recognized the contracts that were above market at acquisition as favorable gas gathering contracts. We have recognized the contract that was deemed to be below market as a noncurrent liability. We amortize these intangibles on a units-of-production basis over the estimated useful life of the contract. We define useful life as the period over which the contract is expected to contribute directly or indirectly to our future cash flows. The related contracts have original terms ranging from 10 years to 20 years. We recognize the amortization expense associated with these intangible assets and liabilities in revenue. | ||||||||||||||||
For our other gas gathering contracts, we amortize contract intangible assets over the period of economic benefit based upon the expected revenues over the life of the contract. The useful life of these contracts ranges from 10 years to 25 years. We recognize the amortization expense associated with these intangible assets in depreciation and amortization expense. | ||||||||||||||||
We have right-of-way intangible assets associated with city easements and easements granted within existing rights-of-way. We amortize these intangible assets over the shorter of the contractual term of the rights-of-way or the estimated useful life of the gathering system. The contractual terms of the rights-of-way range from 20 years to 30 years. The estimated useful life of our gathering systems is 30 years. We recognize the amortization expense associated with these intangible assets in depreciation and amortization expense. | ||||||||||||||||
Other Noncurrent Assets. Other noncurrent assets primarily consist of external costs incurred in connection with the issuance of our senior notes and the closing of our revolving credit facility and related amendments. We capitalize and then amortize these deferred loan costs over the life of the respective debt instrument. We recognize amortization of deferred loan costs in interest expense. | ||||||||||||||||
Revenue Recognition. We generate the majority of our revenue from the natural gas gathering services that we provide to our natural gas producer customers. We also generate revenue from our marketing of natural gas and natural gas liquids ("NGLs"). We realize revenues by receiving fees from our producer customers or by selling the residue natural gas and NGLs. | ||||||||||||||||
We recognize revenue earned from gathering services in gathering services and other fees revenue. We also earn revenue from the sale of physical natural gas purchased from our customers under percentage-of-proceeds arrangements. These revenues are recognized in natural gas, NGLs and condensate sales and other with corresponding expense recognition in cost of natural gas and NGLs. We sell the natural gas that we retain from our DFW Midstream customers to offset the power expenses of the electric-driven compression on the DFW Midstream system. We also sell condensate retained from our gathering services at Grand River Gathering. Revenues from the retainage of natural gas and condensate are recognized in natural gas, NGLs and condensate sales and other; the associated expense is included in operation and maintenance expense. | ||||||||||||||||
We recognize revenue when all of the following criteria are met: (i) persuasive evidence of an exchange arrangement exists, (ii) delivery has occurred or services have been rendered, (iii) the price is fixed or determinable, and (iv) collectability is reasonably assured. | ||||||||||||||||
We obtain access to natural gas and provide services principally under contracts that contain one or both of the following arrangements: | ||||||||||||||||
• | Fee-based arrangements. Under fee-based arrangements, we receive a fee or fees for one or more of the following services: natural gas gathering, compressing, and treating. Fee-based arrangements include natural gas purchase arrangements pursuant to which we purchase natural gas at the wellhead, or other receipt points, at a settled price at the delivery point less a specified amount, generally the same as the fees we would otherwise charge for gathering of natural gas from the wellhead location to the delivery point. The margins earned are directly related to the volume of natural gas that flows through the system. | |||||||||||||||
• | Percent-of-proceeds arrangements. Under percent-of-proceeds arrangements, we generally purchase natural gas from producers at the wellhead, or other receipt points, gather the wellhead natural gas through our gathering system, treat the natural gas, and sell the natural gas to a third party for processing. We then remit to our producers an agreed-upon percentage of the actual proceeds received from sales of the residue natural gas and NGLs. Certain of these arrangements may also result in returning all or a portion of the residue natural gas and/or the NGLs to the producer, in lieu of returning sales proceeds. | |||||||||||||||
Many of our natural gas gathering agreements provide for a monthly or annual minimum volume commitment ("MVC") from certain of our customers. Under these monthly or annual MVCs, our customers agree to ship a minimum volume of natural gas on our gathering systems or to pay a minimum monetary amount over certain periods during the term of the MVC. A customer must make a shortfall payment to us at the end of the contract month or year, as applicable, if its actual throughput volumes are less than its MVC for that month or year. Certain customers are entitled to utilize shortfall payments to offset gathering fees in one or more subsequent periods to the extent that such customer's throughput volumes in subsequent periods exceed its MVC for that period. These contract provisions range from 12 months to eight years. | ||||||||||||||||
We record customer billings for obligations under their MVCs as deferred revenue when the customer has the right to utilize shortfall payments to offset gathering fees in subsequent periods. We recognize deferred revenue under these arrangements in revenue once all contingencies or potential performance obligations associated with the related volumes have either (i) been satisfied through the gathering of future excess volumes of natural gas, or (ii) expired (or lapsed) through the passage of time pursuant to the terms of the applicable natural gas gathering agreement. We classify deferred revenue as short term for arrangements where the expiration of a customer's right to utilize shortfall payments is twelve months or less. As of September 30, 2013, we have billed $24.1 million of deferred revenue relative to shortfall payments, of which $1.1 million was included in accounts receivable, attributable to arrangements that provide the customer the ability to offset gathering fees in the next one month to eight years to the extent that a customer's throughput volumes exceed its MVC. | ||||||||||||||||
Certain customers reimburse us for costs we incur on their behalf. We record costs incurred and reimbursed by our customers on a gross basis. | ||||||||||||||||
Unit-Based Compensation. For awards of unit-based compensation, we determine a grant date fair value and recognize the related compensation expense, adjusted for expected forfeitures, in the statement of operations over the vesting period of the respective awards. See Note 8 for additional information. | ||||||||||||||||
Income Taxes. We are not subject to federal and state income taxes, except as noted below, because we are structured as a partnership. As a result, our unitholders or members are individually responsible for paying federal and state income taxes on their share of our taxable income. | ||||||||||||||||
In general, legal entities that are chartered, organized or conducting business in the state of Texas are subject to the Revised Texas Franchise Tax (the "Texas Margin Tax"). The Texas Margin Tax has the characteristics of an income tax because it is determined by applying a tax rate to a tax base that considers both revenues and expenses. Our financial statements reflect provisions for these tax obligations. | ||||||||||||||||
Earnings Per Unit ("EPU"). We present earnings per limited partner unit data only for periods subsequent to the closing of SMLP’s IPO in October 2012. EPU for periods ended prior to the IPO have not been presented because Summit Investments' members held membership interests and not units. | ||||||||||||||||
We determine EPU by dividing the net income that is attributed, in accordance with the net income and loss allocation provisions of the partnership agreement, to the common and subordinated unitholders under the two-class method, after deducting the general partner's 2% interest in net income and any incentive distributions paid to the general partner, by the weighted-average number of common and subordinated units outstanding during the three and nine months ended September 30, 2013. Diluted earnings per limited partner unit reflects the potential dilution that could occur if securities or other agreements to issue common units, such as unit-based compensation, were exercised, settled or converted into common units. When it is determined that potential common units resulting from an award subject to performance or market conditions should be included in the diluted earnings per limited partner unit calculation, the impact is reflected by applying the treasury stock method. | ||||||||||||||||
Comprehensive Income. Comprehensive income is the same as net income for all periods presented. | ||||||||||||||||
Environmental Matters. We are subject to various federal, state and local laws and regulations relating to the protection of the environment. Although we believe that we are in material compliance with applicable environmental regulations, the risk of costs and liabilities are inherent in pipeline ownership and operation. Liabilities for loss contingencies, including environmental remediation costs, arising from claims, assessments, litigation, fines, and penalties and other sources are charged to expense when it is probable that a liability has been incurred and the amount of the assessment and/or remediation can be reasonably estimated. There are no such liabilities reflected in the accompanying financial statements at September 30, 2013 or December 31, 2012. However, we can provide no assurances that significant costs and liabilities will not be incurred by the Partnership in the future. We are currently not aware of any material contingent liabilities that exist with respect to environmental matters. | ||||||||||||||||
Other Significant Accounting Policies. For information on our other significant accounting policies, see Note 2 of the audited consolidated financial statements included in the 2012 Annual Report. | ||||||||||||||||
Recent Accounting Pronouncements. Accounting standard setters frequently issue new or revised accounting rules. We review new pronouncements to determine the impact, if any, on our financial statements. There are currently no recent pronouncements that have been issued that we believe will materially affect our financial statements. |
PROPERTY_PLANT_AND_EQUIPMENT_N
PROPERTY, PLANT, AND EQUIPMENT, NET | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Property, Plant and Equipment [Abstract] | ' | |||||||||||||||
PROPERTY, PLANT, AND EQUIPMENT, NET | ' | |||||||||||||||
PROPERTY, PLANT, AND EQUIPMENT, NET | ||||||||||||||||
Details on property, plant, and equipment, net were as follows: | ||||||||||||||||
Useful lives (In years) | September 30, | December 31, | ||||||||||||||
2013 | 2012 | |||||||||||||||
(Dollars in thousands) | ||||||||||||||||
Gas gathering systems | 30 | $ | 618,528 | $ | 427,449 | |||||||||||
Compressor stations and compression equipment | 30 | 334,108 | 237,618 | |||||||||||||
Construction in progress | n/a | 50,381 | 45,919 | |||||||||||||
Other | 15-Apr | 9,680 | 4,524 | |||||||||||||
Total | 1,012,697 | 715,510 | ||||||||||||||
Accumulated depreciation | (55,142 | ) | (33,517 | ) | ||||||||||||
Property, plant, and equipment, net | $ | 957,555 | $ | 681,993 | ||||||||||||
The increase in property, plant, and equipment primarily reflects the recognition of gas gathering system fixed assets acquired in connection with the Bison Drop Down and Mountaineer Acquisition. | ||||||||||||||||
Construction in progress is depreciated consistent with its applicable asset class once it is placed in service. Depreciation expense related to property, plant, and equipment and capitalized interest were as follows: | ||||||||||||||||
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
(In thousands) | ||||||||||||||||
Depreciation expense | $ | 8,429 | $ | 5,623 | $ | 21,625 | $ | 15,682 | ||||||||
Capitalized interest | 1,838 | 310 | 2,808 | 2,191 | ||||||||||||
IDENTIFIABLE_INTANGIBLE_ASSETS
IDENTIFIABLE INTANGIBLE ASSETS AND NONCURRENT LIABILITY | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ' | |||||||||||||||
IDENTIFIABLE INTANGIBLE ASSETS AND NONCURRENT LIABILITY | ' | |||||||||||||||
IDENTIFIABLE INTANGIBLE ASSETS, NONCURRENT LIABILITY AND GOODWILL | ||||||||||||||||
Identifiable Intangible Assets and Noncurrent Liability. Identifiable intangible assets and the noncurrent liability, which are subject to amortization, were as follows: | ||||||||||||||||
September 30, 2013 | ||||||||||||||||
Useful lives | Gross carrying amount | Accumulated amortization | Net | |||||||||||||
(In years) | ||||||||||||||||
(Dollars in thousands) | ||||||||||||||||
Favorable gas gathering contracts | 18.7 | $ | 24,195 | $ | (5,847 | ) | $ | 18,348 | ||||||||
Contract intangibles | 16.8 | 429,575 | (34,771 | ) | 394,804 | |||||||||||
Rights-of-way | 28.3 | 55,773 | (4,116 | ) | 51,657 | |||||||||||
Total amortizable intangible assets | $ | 509,543 | $ | (44,734 | ) | $ | 464,809 | |||||||||
Unfavorable gas gathering contract | 10 | $ | 10,962 | $ | (4,358 | ) | $ | 6,604 | ||||||||
December 31, 2012 | ||||||||||||||||
Useful lives | Gross carrying amount | Accumulated amortization | Net | |||||||||||||
(In years) | ||||||||||||||||
(Dollars in thousands) | ||||||||||||||||
Favorable gas gathering contracts | 18.7 | $ | 24,195 | $ | (4,237 | ) | $ | 19,958 | ||||||||
Contract intangibles | 12.4 | 244,100 | (14,504 | ) | 229,596 | |||||||||||
Rights-of-way | 28.3 | 38,848 | (2,862 | ) | 35,986 | |||||||||||
Total amortizable intangible assets | $ | 307,143 | $ | (21,603 | ) | $ | 285,540 | |||||||||
Unfavorable gas gathering contract | 10 | $ | 10,962 | $ | (3,542 | ) | $ | 7,420 | ||||||||
The increase in total amortizable intangible assets primarily reflects the recognition of gas gathering contracts and rights-of-way acquired in connection with the Bison Drop Down and the Mountaineer Acquisition. | ||||||||||||||||
We recognized amortization expense as follows: | ||||||||||||||||
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
(In thousands) | ||||||||||||||||
Amortization expense – favorable gas gathering contracts | $ | 511 | $ | 501 | $ | 1,610 | $ | 1,181 | ||||||||
Amortization expense – contract intangibles | 7,559 | 3,194 | 20,267 | 9,483 | ||||||||||||
Amortization expense – rights-of-way | 438 | 340 | 1,254 | 970 | ||||||||||||
Amortization expense – unfavorable gas gathering contract | (247 | ) | (341 | ) | (816 | ) | (1,206 | ) | ||||||||
The estimated aggregate annual amortization of intangible assets and noncurrent liability expected to be recognized as of September 30, 2013 for the remainder of 2013 and each of the four succeeding fiscal years follows. | ||||||||||||||||
Assets | Liabilities | |||||||||||||||
(In thousands) | ||||||||||||||||
2013 | $ | 8,801 | $ | 378 | ||||||||||||
2014 | 36,949 | 1,549 | ||||||||||||||
2015 | 39,628 | 1,650 | ||||||||||||||
2016 | 39,754 | 1,571 | ||||||||||||||
2017 | 38,316 | 1,456 | ||||||||||||||
Goodwill. We recognized goodwill of $45.5 million in connection with the acquisition of Grand River Gathering in 2011 and allocated it to the Grand River Gathering reporting unit. We recognized goodwill of $54.2 million in connection with the Bison Drop Down in June 2013 and allocated it to the Bison Midstream reporting unit. The goodwill attributed to Bison Midstream represents its allocation of the goodwill that Summit Investments recognized in connection with its acquisition of BTE assets in February 2013. We preliminarily recognized goodwill of $18.1 million in connection with the Mountaineer Acquisition in June 2013 and allocated it to the Mountaineer Midstream reporting unit. Goodwill allocated to the Mountaineer Midstream reporting unit will be finalized in conjunction with the finalization of the acquisition accounting. See Notes 1 and 12 for additional information. A rollforward of the consolidated balance of goodwill for the nine months ended September 30, 2013 follows. | ||||||||||||||||
(In thousands) | ||||||||||||||||
Goodwill, beginning of period | $ | 45,478 | ||||||||||||||
Goodwill recognized in connection with the Bison Drop Down | 54,199 | |||||||||||||||
Goodwill preliminarily recognized in connection with the Mountaineer Acquisition | 18,089 | |||||||||||||||
Goodwill, end of period | $ | 117,766 | ||||||||||||||
We evaluate goodwill for impairment annually on September 30. We also evaluate goodwill whenever events or circumstances indicate that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. We performed our annual goodwill impairment testing as of September 30, 2013 using a combination of the income and market approaches and determined that the fair value of each of the reporting units exceeded their carrying value resulting in no goodwill impairment. There have been no impairments of goodwill. |
LONGTERM_DEBT
LONG-TERM DEBT | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
REVOLVING CREDIT FACILITY [Abstract] | ' | |||||||
REVOLVING CREDIT FACILITY | ' | |||||||
LONG-TERM DEBT | ||||||||
Long-term debt consisted of the following: | ||||||||
September 30, | December 31, | |||||||
2013 | 2012 | |||||||
(In thousands) | ||||||||
Variable rate senior secured revolving credit facility (3.43% at September 30, 2013 and 2.98% at December 31, 2012) due November 2018 | $ | 265,050 | $ | 199,230 | ||||
7.50% Senior unsecured notes due July 2021 | 300,000 | — | ||||||
Total long-term debt | $ | 565,050 | $ | 199,230 | ||||
Revolving Credit Facility. We have a senior secured revolving credit facility. In June 2013, we exercised the revolving credit facility's $50.0 million accordion provision and increased the total commitments thereunder from $550.0 million to $600.0 million. We also borrowed $200.0 million in connection with the Bison Drop Down and $110.0 million in connection with the Mountaineer Acquisition. See Notes 1, 6 and 12 for additional information. Also in June 2013, we used the proceeds from our senior notes offering to repay $294.2 million of our revolving credit facility. As of September 30, 2013, the outstanding balance of the revolving credit facility was $265.1 million. | ||||||||
The revolving credit facility is secured by the membership interests of Summit Holdings, DFW Midstream, Grand River Gathering, Bison Midstream and Mountaineer Midstream and substantially all of the assets of these entities. It is guaranteed by SMLP and all of its subsidiaries, except for Summit Midstream Finance Corp. ("Finance Corp.") and allows for revolving loans, letters of credit and swingline loans. | ||||||||
Borrowings under the revolving credit facility bear interest at the London Interbank Offered Rate ("LIBOR") plus an applicable margin or a base rate, as defined in the credit agreement. At September 30, 2013, the applicable margin under LIBOR borrowings was 3.25%, the interest rate was 3.43% and the unused portion of the revolving credit facility totaled $334.9 million (subject to a commitment fee of 0.50%). | ||||||||
The revolving credit agreement contains affirmative and negative covenants customary for credit facilities of its size and nature that, among other things, limit or restrict the ability to: (i) incur additional debt; (ii) make investments; (iii) engage in certain mergers, consolidations, acquisitions or sales of assets; (iv) enter into swap agreements and power purchase agreements; (v) enter into leases that would cumulatively obligate payments in excess of $30.0 million over any 12-month period; and (vi) prohibits the payment of distributions by Summit Holdings if a default then exists or would result therefrom, and otherwise limits the amount of distributions Summit Holdings can make. In addition, the revolving credit facility requires Summit Holdings to maintain a ratio of consolidated trailing 12-month earnings before interest, income taxes, depreciation and amortization ("EBITDA") to net interest expense of not less than 2.5 to 1.0 (as defined in the credit agreement) and a ratio of total net indebtedness to consolidated trailing 12-month EBITDA of not more than 5.0 to 1.0, or not more than 5.5 to 1.0 for up to six months following certain acquisitions (as defined in the credit agreement). | ||||||||
As of September 30, 2013, we were in compliance with the covenants in the revolving credit facility. There were no defaults or events of default during the nine months ended September 30, 2013. | ||||||||
In November 2013, we closed on an amendment and restatement of the revolving credit facility which: (i) increases the borrowing capacity to $700.0 million, (ii) extends the maturity to November 2018, (iii) includes a $200.0 million accordion feature, (iv) reduces the leverage-based pricing grid by 0.75% to a new range of 1.75% to 2.75%, (v) changes the commitment fee to a leverage-based range of 0.30% to 0.50%, and (vi) adds Finance Corp. as a subsidiary guarantor. | ||||||||
Senior Notes. On June 17, 2013, Summit Holdings and its 100% owned finance subsidiary, Finance Corp. (together with Summit Holdings, the "Co-Issuers"), issued $300.0 million of 7.50% senior unsecured notes maturing July 1, 2021 (the "senior notes"). The senior notes were sold within the United States only to qualified institutional buyers in reliance on Rule 144A under the Securities Act of 1933, as amended (the "Securities Act"), and outside the United States only to non-U.S. persons in reliance on Regulation S under the Securities Act. The senior notes have not been registered under the Securities Act or any state securities laws, and, unless so registered, may not be offered or sold in the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable state securities laws. | ||||||||
We will pay interest on the senior notes semi-annually in cash in arrears on January 1 and July 1 of each year, commencing January 1, 2014. The senior notes are senior, unsecured obligations and rank equally in right of payment with all of our existing and future senior obligations. The senior notes are effectively subordinated in right of payment to all of our secured indebtedness, to the extent of the collateral securing such indebtedness. We used the proceeds from the issuance of the senior notes to repay a portion of the balance outstanding under our revolving credit facility. Debt issuance costs of $7.3 million, recognized in other noncurrent assets, are being amortized over the life of the senior notes. | ||||||||
SMLP and all of its subsidiaries other than the Co-Issuers (the "Guarantors") have fully and unconditionally and jointly and severally guaranteed the senior notes. SMLP has no independent assets or operations. Summit Holdings has no assets or operations other than its ownership of its wholly owned subsidiaries and activities associated with its borrowings under the revolving credit facility and the senior notes. Finance Corp. has no independent assets or operations and was formed for the sole purpose of being a co-issuer of certain of Summit Holdings' indebtedness, including the senior notes. There are no significant restrictions on the ability of SMLP or Summit Holdings to obtain funds from its subsidiaries by dividend or loan. | ||||||||
Under a registration rights agreement, the Co-Issuers and the Guarantors have agreed to file a registration statement with the SEC pursuant to which the Co-Issuers will either offer to exchange the senior notes and the guarantees for registered notes and guarantees with substantially identical terms or, in certain circumstances, register the resale of the senior notes and their guarantees (the "Exchange Offer"). | ||||||||
If the Exchange Offer is not completed (or, if required, the shelf registration statement is not declared effective or does not automatically become effective) on or before the 365th day following the date of issuance of the senior notes (the ‘‘Exchange Completion Deadline’’), the Co-Issuers will be required to pay additional interest in an amount equal to 0.25% per annum of the principal amount of senior notes with respect to the first 90-day period following the Exchange Completion Deadline. The amount of the additional interest will increase by an additional 0.25% per annum with respect to each subsequent 90-day period, up to a maximum amount of additional interest of 1.0% per annum of the principal amount of senior notes outstanding until the Exchange Offer is completed or the shelf registration statement is declared effective (or becomes automatically effective). All accrued additional interest will be paid by the Co-Issuers and the Guarantors on the next scheduled interest payment date in the same manner as other interest is paid on the senior notes. Following the time that the senior notes are registered, the accrual of additional interest will cease. | ||||||||
At any time prior to July 1, 2016, the Co-Issuers may redeem up to 35% of the aggregate principal amount of the senior notes at a redemption price of 107.500% of the principal amount of the senior notes, plus accrued and unpaid interest, if any, to the redemption date, with an amount not greater than the net cash proceeds of certain equity offerings. On and after July 1, 2016, the Co-Issuers may redeem all or part of the senior notes at a redemption price of 105.625% (with the redemption premium declining ratably each year to 100.000% on July 1, 2019), plus accrued and unpaid interest, if any. | ||||||||
The indenture restricts SMLP’s and the Co-Issuers’ ability and the ability of certain of their subsidiaries to: (i) incur additional debt or issue preferred stock; (ii) make distributions, repurchase equity or redeem subordinated debt; (iii) make payments on subordinated indebtedness; (iv) create liens or other encumbrances; (v) make investments, loans or other guarantees; (vi) sell or otherwise dispose of a portion of their assets; (vii) engage in transactions with affiliates; and (viii) make acquisitions or merge or consolidate with another entity. These covenants are subject to a number of important exceptions and qualifications. At any time when the senior notes are rated investment grade by each of Moody’s Investors Service, Inc. and Standard & Poor’s Ratings Services and no default or event of default under the indenture has occurred and is continuing, many of these covenants will terminate. | ||||||||
The indenture provides that each of the following is an event of default: (i) default for 30 days in the payment when due of interest on the senior notes; (ii) default in the payment when due of the principal of, or premium, if any, on the senior notes; (iii) failure by the Co-Issuers or SMLP to comply with certain covenants relating to merger, consolidation, sale of assets, change of control or asset sales; (iv) failure by SMLP for 180 days after notice to comply with certain covenants relating to the filing of reports with the SEC; (v) failure by the Co-Issuers or SMLP for 30 days after notice to comply with any of the other agreements in the indenture; (vi) specified defaults under any mortgage, indenture or instrument under which there may be issued or by which there may be secured or evidenced any indebtedness for money borrowed by SMLP or any of its restricted subsidiaries (or the payment of which is guaranteed by SMLP or any of its restricted subsidiaries); (vii) failure by SMLP or any of its restricted subsidiaries to pay certain final judgments aggregating in excess of $20.0 million; (viii) except as permitted by the indenture, any guarantee of the senior notes shall cease for any reason to be in full force and effect or any guarantor, or any person acting on behalf of any guarantor, shall deny or disaffirm its obligations under its guarantee of the senior notes; and (ix) certain events of bankruptcy, insolvency or reorganization described in the indenture. In the case of an event of default as described in the foregoing clause (ix), all outstanding senior notes will become due and payable immediately without further action or notice. If any other event of default occurs and is continuing, the trustee or the holders of at least 25% in principal amount of the then outstanding senior notes may declare all the senior notes to be due and payable immediately. | ||||||||
There were no defaults or events of default during the period from issuance through September 30, 2013. |
PARTNERS_CAPITAL_AND_MEMBERSHI
PARTNERS' CAPITAL AND MEMBERSHIP INTERESTS | 9 Months Ended | ||||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||||
Equity [Abstract] | ' | ||||||||||||||||||||||
PARTNERS' CAPITAL AND MEMBERSHIP INTERESTS | ' | ||||||||||||||||||||||
PARTNERS' CAPITAL AND MEMBERSHIP INTERESTS | |||||||||||||||||||||||
Partners' Capital | |||||||||||||||||||||||
SMLP was formed in May 2012. Prior to the closing of its IPO on October 3, 2012, SMLP had no outstanding common or subordinated units or operations. A rollforward of the number of common limited partner, subordinated limited partner and general partner units from December 31, 2012 to September 30, 2013 follows. | |||||||||||||||||||||||
Common | Subordinated | General partner | Total | ||||||||||||||||||||
Units, beginning of period | 24,412,427 | 24,409,850 | 996,320 | 49,818,597 | |||||||||||||||||||
Units issued to SMP Holdings in connection with the Bison Drop Down | 1,553,849 | — | 31,711 | 1,585,560 | |||||||||||||||||||
Units issued to SMP Holdings in connection with the Mountaineer Acquisition | 3,107,698 | — | 63,422 | 3,171,120 | |||||||||||||||||||
Units issued | 1,473 | — | — | 1,473 | |||||||||||||||||||
Units, end of period | 29,075,447 | 24,409,850 | 1,091,453 | 54,576,750 | |||||||||||||||||||
Bison Drop Down. On June 4, 2013, SMLP acquired Bison Midstream from SMP Holdings. SMP Holdings contributed 100% of the membership interests in Bison Midstream to SMLP, which concurrently contributed the membership interests to Summit Holdings. In exchange for its $305.4 million net investment in Bison Midstream, SMLP paid SMP Holdings and the general partner total cash and unit consideration of $248.9 million. As a result of the contribution of net assets in excess of consideration, SMLP recognized a capital contribution from SMP Holdings. The details of total cash and unit consideration as well as the calculation of the capital contribution and its allocation to partners' capital follow. | |||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||
SMP Holdings' net investment in Bison Midstream | $ | 305,449 | |||||||||||||||||||||
Aggregate cash paid to SMP Holdings | $ | 200,000 | |||||||||||||||||||||
Issuance of 1,553,849 SMLP common units to SMP Holdings | 47,936 | ||||||||||||||||||||||
Issuance of 31,711 SMLP general partner units to the general partner | 978 | ||||||||||||||||||||||
Total consideration | 248,914 | ||||||||||||||||||||||
SMP Holdings' contribution of net assets in excess of consideration | $ | 56,535 | |||||||||||||||||||||
Allocation of capital contribution: | |||||||||||||||||||||||
General partner interest | $ | 1,131 | |||||||||||||||||||||
Common limited partner interest | 28,558 | ||||||||||||||||||||||
Subordinated limited partner interest | 26,846 | ||||||||||||||||||||||
Partners' capital allocation | $ | 56,535 | |||||||||||||||||||||
The number of units issued to SMP Holdings and the general partner in connection with the Bison Drop Down was calculated based on an assumed equity issuance of $50.0 million and the five-day volume-weighted-average price as of June 3, 2013 of $31.53 per unit. The units were then valued as of June 4, 2013 (the date of closing) using the June 4, 2013 closing price of SMLP's units of $30.85. | |||||||||||||||||||||||
The general partner interest allocation was calculated based on a 2% general partner interest in the contribution of assets in excess of consideration given by SMLP to SMP Holdings. Common and subordinated limited partner interests allocations were calculated as their respective percentages of total limited partner capital applied to the balance of the contribution by SMP Holdings after giving effect to the general partner allocation. See Notes 1, 5 and 12 for additional information. | |||||||||||||||||||||||
Mountaineer Acquisition. On June 4, 2013, SMLP executed definitive agreements with MarkWest to acquire the Mountaineer Midstream system. On June 21, 2013, prior to closing the Mountaineer Acquisition and in accordance with the definitive agreements with MarkWest (the "MarkWest Agreement"), Mountaineer Midstream acquired all of the Mountaineer Gathering system assets. The total acquisition purchase price of $210.0 million was funded with $110.0 million of borrowings under SMLP’s revolving credit facility and the issuance of $100.0 million of SMLP common units and general partner interests to SMP Holdings and the general partner for cash. The allocation and valuation of units issued to SMP Holdings and the general partner to partially fund the Mountaineer Acquisition follow. | |||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||
Issuance of 3,107,698 SMLP common units to SMP Holdings | $ | 98,000 | |||||||||||||||||||||
Issuance of 63,422 SMLP general partner units to the general partner | 2,000 | ||||||||||||||||||||||
Issuance of units in connection with the Mountaineer Acquisition | $ | 100,000 | |||||||||||||||||||||
Pursuant to a unit purchase agreement, the number of units issued to SMP Holdings and the general partner in connection with the Mountaineer Acquisition was calculated based on an assumed equity issuance of $100.0 million and the five-day volume-weighted-average price as of June 3, 2013 of $31.53 per unit. See Notes 1, 5 and 12 for additional information. | |||||||||||||||||||||||
Subordination. The principal difference between our common units and subordinated units is that in any quarter during the subordination period, holders of the subordinated units are not entitled to receive any distribution of available cash until the common units have received the minimum quarterly distribution plus any arrearages in the payment of the minimum quarterly distribution from prior quarters. Subordinated units will not accrue arrearages for unpaid quarterly distributions or quarterly distributions less than the minimum quarterly distribution. If we do not pay the minimum quarterly distribution on our common units, our common unitholders will not be entitled to receive such payments in the future except during the subordination period. To the extent we have available cash in any future quarter during the subordination period in excess of the amount necessary to pay the minimum quarterly distribution to holders of our common units, we will use this excess available cash to pay any distribution arrearages related to prior quarters before any cash distribution is made to holders of subordinated units. When the subordination period ends, all subordinated units will convert into common units on a one-for-one basis, and thereafter no common units will be entitled to arrearages. | |||||||||||||||||||||||
The subordination period will end on the first business day after we have earned and paid at least (1) $1.60 (the minimum quarterly distribution on an annualized basis) on each outstanding common unit and subordinated unit and the corresponding distribution on the general partner's 2.0% interest for each of three consecutive, non-overlapping four-quarter periods ending on or after December 31, 2015 or (2) $2.40 (150.0% of the annualized minimum quarterly distribution) on each outstanding common unit and subordinated unit and the corresponding distributions on the general partner's 2.0% interest and the related distribution on the incentive distribution rights for the four-quarter period immediately preceding that date, in each case provided there are no arrearages on the common units at that time. | |||||||||||||||||||||||
Cash Distribution Policy | |||||||||||||||||||||||
Our partnership agreement requires that we distribute all of our available cash (as defined below) within 45 days after the end of each quarter to unitholders of record on the applicable record date. Our policy is to distribute to our unitholders an amount of cash each quarter that is equal to or greater than the minimum quarterly distribution stated in our partnership agreement. | |||||||||||||||||||||||
Details of cash distributions declared during 2013 follow. | |||||||||||||||||||||||
Attributable to the | Payment date | Per-unit distribution | Cash paid (or payable) to common unitholders | Cash paid (or payable) to subordinated unitholders | Cash paid (or payable) to general partner | Total distribution | |||||||||||||||||
quarter ended | |||||||||||||||||||||||
(Dollars in thousands, except per-unit amounts) | |||||||||||||||||||||||
December 31, 2012 | February 14, 2013 | $ | 0.41 | $ | 10,009 | $ | 10,008 | $ | 408 | $ | 20,425 | ||||||||||||
March 31, 2013 | May 15, 2013 | 0.42 | 10,253 | 10,252 | 418 | 20,923 | |||||||||||||||||
June 30, 2013 | August 14, 2013 | 0.435 | 12,647 | 10,618 | 475 | 23,740 | |||||||||||||||||
September 30, 2013 | November 14, 2013 | 0.46 | 13,377 | 11,229 | 502 | 25,108 | |||||||||||||||||
Minimum Quarterly Distribution. Our partnership agreement generally requires that we make a minimum quarterly distribution to the holders of our common units and subordinated units of $0.40 per unit, or $1.60 on an annualized basis, to the extent we have sufficient cash from our operations after the establishment of cash reserves and the payment of costs and expenses, including reimbursements of expenses to our general partner. The amount of distributions paid under our policy and the decision to make any distribution is determined by our general partner, taking into consideration the terms of our partnership agreement. | |||||||||||||||||||||||
Definition of Available Cash. Available cash generally means, for any quarter, all cash on hand at the end of that quarter: | |||||||||||||||||||||||
• | less the amount of cash reserves established by our general partner at the date of determination of available cash for that quarter to: | ||||||||||||||||||||||
• | provide for the proper conduct of our business (including reserves for our future capital expenditures and anticipated future debt service requirements); | ||||||||||||||||||||||
• | comply with applicable law, any of our debt instruments or other agreements; or | ||||||||||||||||||||||
• | provide funds for distributions to our unitholders and to our general partner for any one or more of the next four quarters (provided that our general partner may not establish cash reserves for distributions unless it determines that the establishment of reserves will not prevent us from distributing the minimum quarterly distribution on all common units and any cumulative arrearages on such common units for the current quarter); | ||||||||||||||||||||||
• | plus, if our general partner so determines, all or any portion of the cash on hand on the date of determination of available cash for the quarter resulting from working capital borrowings made subsequent to the end of such quarter. | ||||||||||||||||||||||
General Partner Interest and Incentive Distribution Rights. Our general partner is entitled to 2.0% of all distributions that we make prior to our liquidation. Our general partner has the right, but not the obligation, to contribute a proportionate amount of capital to us to maintain its current general partner interest. Our general partner's initial 2.0% interest in our distributions will be reduced if we issue additional units in the future and our general partner does not contribute a proportionate amount of capital to us to maintain its 2.0% general partner interest. | |||||||||||||||||||||||
Our general partner also currently holds incentive distribution rights that entitle it to receive increasing percentage allocations, up to a maximum of 50.0% (as set forth in the chart below), of the cash we distribute from operating surplus in excess of $0.46 per unit per quarter. The maximum distribution of 50.0% includes distributions paid to our general partner on its 2.0% general partner interest and assumes that our general partner maintains its general partner interest at 2.0%. The maximum distribution of 50.0% does not include any distributions that our general partner may receive on any common or subordinated units that it owns. | |||||||||||||||||||||||
Percentage Allocations of Available Cash. The following table illustrates the percentage allocations of available cash between the unitholders and our general partner based on the specified target distribution levels. The amounts set forth in the column Marginal Percentage Interest in Distributions are the percentage interests of our general partner and the unitholders in any available cash we distribute up to and including the corresponding amount in the column Total Quarterly Distribution Per Unit Target Amount. The percentage interests shown for our unitholders and our general partner for the minimum quarterly distribution are also applicable to quarterly distribution amounts that are less than the minimum quarterly distribution. The percentage interests set forth below for our general partner include its 2.0% general partner interest and assume that our general partner has contributed any additional capital necessary to maintain its 2.0% general partner interest, our general partner has not transferred its incentive distribution rights and that there are no arrearages on common units. | |||||||||||||||||||||||
Total quarterly distribution per unit target amount | Marginal percentage interest in distributions | ||||||||||||||||||||||
Unitholders | General partner | ||||||||||||||||||||||
Minimum quarterly distribution | $0.40 | 98.00% | 2.00% | ||||||||||||||||||||
First target distribution | $0.40 up to $0.46 | 98.00% | 2.00% | ||||||||||||||||||||
Second target distribution | above $0.46 up to $0.50 | 85.00% | 15.00% | ||||||||||||||||||||
Third target distribution | above $0.50 up to $0.60 | 75.00% | 25.00% | ||||||||||||||||||||
Thereafter | above $0.60 | 50.00% | 50.00% | ||||||||||||||||||||
Membership Interests | |||||||||||||||||||||||
Energy Capital Partners and GE Energy Financial Services hold membership interests in Summit Investments. Such membership interests give them the right to participate in distributions and to exercise the other rights or privileges available to each entity under Summit Investments' Amended and Restated Limited Liability Operating Agreement (the "Summit LLC Agreement"). In addition, certain members of Summit Investments’ management hold ownership interests in the form of Class B membership interests (the "SMP Net Profits Interests") through their ownership in Summit Midstream Management, LLC. | |||||||||||||||||||||||
In accordance with the Summit LLC Agreement, capital accounts are maintained for Summit Investments’ members. The capital account provisions of the Summit LLC Agreement incorporate principles established for U.S. federal income tax purposes and as such are not comparable to the equity accounts reflected under GAAP in our consolidated financial statements. | |||||||||||||||||||||||
The Summit LLC Agreement sets forth the calculation to be used in determining the amount and priority of cash distributions that its membership interest holders will receive. Capital contributions required under the Summit LLC Agreement are in proportion to the members' respective percentage ownership interests. The Summit LLC Agreement also contains provisions for the allocation of net earnings and losses to members. For purposes of maintaining partner capital accounts, the Summit LLC Agreement specifies that items of income and loss shall be allocated among the partners in accordance with their respective percentage interests. | |||||||||||||||||||||||
In April 2013, we repurchased the outstanding net profits interests in DFW Midstream. See Note 8 for additional information. |
EARNINGS_PER_UNIT
EARNINGS PER UNIT | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Earnings Per Share [Abstract] | ' | |||||||
EARNINGS PER UNIT | ' | |||||||
EARNINGS PER UNIT | ||||||||
The following table presents details on EPU. | ||||||||
Three months ended September 30, 2013 | Nine months ended September 30, 2013 | |||||||
(Dollars in thousands, except | ||||||||
per-unit amounts) | ||||||||
Net income | $ | 6,691 | $ | 27,291 | ||||
Less: net income attributable to SMP Holdings | — | 52 | ||||||
Net income attributable to partners | 6,691 | 27,239 | ||||||
Less: net income attributable to general partner | 134 | 545 | ||||||
Net income attributable to limited partners | $ | 6,557 | $ | 26,694 | ||||
Net income attributable to common units | $ | 3,567 | $ | 14,899 | ||||
Weighted-average common units outstanding – basic | 29,074,743 | 26,234,042 | ||||||
Earnings per common unit – basic | $ | 0.12 | $ | 0.57 | ||||
Weighted-average common units outstanding – diluted | 29,227,041 | 26,352,234 | ||||||
Earnings per common unit – diluted | $ | 0.12 | $ | 0.57 | ||||
Net income attributable to subordinated units | $ | 2,990 | $ | 11,795 | ||||
Weighted-average subordinated units outstanding – basic and diluted | 24,409,850 | 24,409,850 | ||||||
Earnings per subordinated unit – basic and diluted | $ | 0.12 | $ | 0.48 | ||||
The effect of nonvested phantom units and nonvested restricted units on the weighted-average number of units used to calculate diluted earnings per common limited partner unit was 152,298 units for the three months ended September 30, 2013 and 118,192 units for the nine months ended September 30, 2013. There were no units excluded from diluted earnings per unit as we do not have any anti-dilutive units for the three and nine months ended September 30, 2013. See Note 8 for additional information. |
UNITBASED_COMPENSATION
UNIT-BASED COMPENSATION | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | |||||||||||||||
UNIT-BASED COMPENSATION | ' | |||||||||||||||
UNIT-BASED COMPENSATION | ||||||||||||||||
Long-Term Incentive Plan. The Long-Term Incentive Plan (the "LTIP") provides for equity awards to eligible officers, employees, consultants and directors of our general partner and its affiliates, thereby linking the recipients' compensation directly to SMLP’s performance. The LTIP is administered by our general partner's board of directors, though such administration function may be delegated to a committee appointed by the board. A total of 5.0 million common units was reserved for issuance pursuant to and in accordance with the LTIP. As of September 30, 2013, approximately 4.7 million common units remained available for future issuance. | ||||||||||||||||
The LTIP provides for the granting, from time to time, of unit-based awards, including common units, restricted units, phantom units, unit options, unit appreciation rights, distribution equivalent rights, profits interest units and other unit-based awards. Grants are made at the discretion of the board of directors or compensation committee of our general partner. The administrator of the LTIP may make grants under the LTIP that contain such terms, consistent with the LTIP, as the administrator may determine are appropriate, including vesting conditions. The administrator of the LTIP may, in its discretion, base vesting on the grantee's completion of a period of service or upon the achievement of specified financial objectives or other criteria or upon a change of control (as defined in the LTIP) or as otherwise described in an award agreement. Termination of employment prior to vesting will result in forfeiture of the awards, except in limited circumstances as described in the plan documents. Units that are canceled or forfeited will be available for delivery pursuant to other awards. | ||||||||||||||||
The following table presents phantom and restricted unit activity: | ||||||||||||||||
Units | Weighted-average grant date fair value | |||||||||||||||
Nonvested phantom and restricted units, January 1, 2013 | 131,558 | $ | 20 | |||||||||||||
Phantom units granted | 155,330 | $ | 26.33 | |||||||||||||
Restricted units granted | 835 | $ | 27.5 | |||||||||||||
Phantom units forfeited | (4,041 | ) | $ | 25.99 | ||||||||||||
Nonvested phantom and restricted units, September 30, 2013 | 283,682 | $ | 23.41 | |||||||||||||
A phantom unit is a notional unit that entitles the grantee to receive a common unit upon the vesting of the phantom unit or on a deferred basis upon specified future dates or events or, in the discretion of the administrator, cash equal to the fair market value of a common unit. Distribution equivalent rights for each phantom unit provide for a lump sum cash amount equal to the accrued distributions from the grant date to be paid in cash upon the vesting date. The phantom units granted in 2013 vest ratably over a three-year period. Upon vesting, awards may be settled in cash and/or common units, at the discretion of the board of directors. | ||||||||||||||||
Upon vesting, management intends to settle all phantom unit awards with common units. As of September 30, 2013, the unrecognized unit-based compensation related to the LTIP was $4.4 million. Incremental unit-based compensation will be recorded over the remaining vesting period of 2.92 years. Due to the limited and immaterial forfeiture history associated with the grants under the LTIP, no forfeitures were assumed in the determination of estimated compensation expense. | ||||||||||||||||
Unit-based compensation recognized in general and administrative expense related to awards under the LTIP was as follows: | ||||||||||||||||
Three months ended September 30, 2013 | Nine months ended September 30, 2013 | |||||||||||||||
(In thousands) | ||||||||||||||||
SMLP unit-based compensation | $ | 829 | $ | 1,970 | ||||||||||||
DFW Net Profits Interests. Class B membership interests in DFW Midstream (the "DFW Net Profits Interests") participated in distributions upon time vesting and the achievement of certain distribution targets to Class A members or higher priority vested DFW Net Profits Interests. The DFW Net Profits Interests were accounted for as compensatory awards. All grants vested ratably and provided for accelerated vesting in certain limited circumstances, including a qualifying termination following a change in control (as defined in the underlying award agreement and the DFW Midstream Amended and Restated Limited Liability Company Agreement and Contribution Agreement). | ||||||||||||||||
We recognized unit-based compensation ratably over the respective award's vesting period. Unit-based compensation recognized in general and administrative expense related to the DFW Net Profits Interests was as follows: | ||||||||||||||||
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
(In thousands) | ||||||||||||||||
Class B membership interest unit-based compensation | $ | — | $ | 75 | $ | 17 | $ | 874 | ||||||||
Beginning in October 2012 and continuing into April 2013, we entered into a series of repurchases with the remaining seven holders of the then-outstanding DFW Net Profits Interests whereby we exchanged $12.2 million for their vested DFW Net Profits Interests and 7,393 SMLP restricted units for their unvested DFW Net Profits Interests. The repurchase prices were determined by valuing the vested and unvested net profits interests in relation to the enterprise value of DFW Midstream and represented fair value at the dates of repurchase. Upon the conclusion of these repurchase transactions, there were no remaining or outstanding DFW Net Profits Interests as of April 30, 2013. |
CONCENTRATIONS_OF_RISK
CONCENTRATIONS OF RISK | 9 Months Ended | |||||||||||
Sep. 30, 2013 | ||||||||||||
Risks and Uncertainties [Abstract] | ' | |||||||||||
CONCENTRATIONS OF RISK | ' | |||||||||||
CONCENTRATIONS OF RISK | ||||||||||||
Financial instruments that potentially subject us to concentrations of credit risk consist of cash and accounts receivable. We maintain our cash in bank deposit accounts that, at times, may exceed federally insured limits. We have not experienced any losses in such accounts and do not believe we are exposed to any significant risk. | ||||||||||||
Accounts receivable are primarily from natural gas producers shipping natural gas. This industry concentration has the potential to impact our overall exposure to credit risk, either positively or negatively, in that our customers may be similarly affected by changes in economic, industry or other conditions. We monitor the creditworthiness of our counterparties and generally require letters of credit for receivables from counterparties that are judged to have sub-standard credit, unless the credit risk can otherwise be mitigated. | ||||||||||||
Counterparties accounting for more than 10% of total revenues were as follows: | ||||||||||||
Three months ended September 30, | Nine months ended September 30, | |||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||
Revenue: | ||||||||||||
Counterparty A | 17 | % | 29 | % | 19 | % | 19 | % | ||||
Counterparty B | 16 | % | 29 | % | 18 | % | 27 | % | ||||
Counterparty C | 10 | % | — | % | 9 | % | — | % | ||||
Counterparty D | 10 | % | — | % | 9 | % | — | % | ||||
Counterparty E | * | 13 | % | * | 14 | % | ||||||
__________ | ||||||||||||
* Less than 10% | ||||||||||||
Counterparties accounting for more than 10% of total accounts receivable were as follows: | ||||||||||||
September 30, | December 31, | |||||||||||
2013 | 2012 | |||||||||||
Accounts receivable: | ||||||||||||
Counterparty A | 23 | % | 24 | % | ||||||||
Counterparty B | 21 | % | 38 | % | ||||||||
Counterparty C | * | — | % | |||||||||
Counterparty D | * | — | % | |||||||||
Counterparty E | * | * | ||||||||||
__________ | ||||||||||||
* Less than 10% |
RELATEDPARTY_TRANSACTIONS
RELATED-PARTY TRANSACTIONS | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Related Party Transactions [Abstract] | ' | |||||||||||||||
RELATED-PARTY TRANSACTIONS | ' | |||||||||||||||
RELATED-PARTY TRANSACTIONS | ||||||||||||||||
Recent Acquisitions and Partners' Capital Issuances. See Notes 5, 6 and 12 for disclosure of the purchase of Bison Midstream from SMP Holdings and the issuance of common units and general partner interests to SMP Holdings in connection with the Bison Drop Down and the Mountaineer Acquisition. | ||||||||||||||||
General and Administrative Expense Allocation. Our general partner and its affiliates do not receive a management fee or other compensation in connection with the management of our business, but will be reimbursed for expenses incurred on our behalf. Under our partnership agreement, we reimburse our general partner and its affiliates for certain expenses incurred on our behalf, including, without limitation, salary, bonus, incentive compensation and other amounts paid to our general partner's employees and executive officers who perform services necessary to run our business. In addition, we reimburse our general partner for compensation, travel and entertainment expenses for the directors serving on the board of directors of our general partner and the cost of director and officer liability insurance. Our partnership agreement provides that our general partner will determine in good faith the expenses that are allocable to us. | ||||||||||||||||
The payable to our general partner for expenses that were paid on our behalf and the receivable from the general partner for expenses that we paid that were not allocated to the Partnership were as follows: | ||||||||||||||||
September 30, | December 31, | |||||||||||||||
2013 | 2012 | |||||||||||||||
(In thousands) | ||||||||||||||||
Due to affiliate | $ | 430 | $ | — | ||||||||||||
Due from affiliate | — | 774 | ||||||||||||||
Expenses incurred and allocated to us by the general partner under our partnership agreement were as follows: | ||||||||||||||||
Three months ended September 30, 2013 | Nine months ended September 30, 2013 | |||||||||||||||
(In thousands) | ||||||||||||||||
General and administrative expense allocation | $ | 794 | $ | 2,600 | ||||||||||||
Electricity Management Services Agreement. We entered into a consulting arrangement with EquiPower Resources Corp. to assist with managing DFW Midstream's electricity price risk. EquiPower Resources Corp. is an affiliate of Energy Capital Partners. Amounts paid for such services were as follows: | ||||||||||||||||
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
(In thousands) | ||||||||||||||||
Payments for electricity management consulting services | $ | 54 | $ | 56 | $ | 163 | $ | 144 | ||||||||
COMMITMENTS_AND_CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | ' | |||||||||||||||
COMMITMENTS AND CONTINGENCIES | ' | |||||||||||||||
COMMITMENTS AND CONTINGENCIES | ||||||||||||||||
Operating Leases. We lease various office space to support our operations and have determined that our leases are operating leases. Total rent expense related to operating leases, which is recognized in general and administrative expenses, was as follows: | ||||||||||||||||
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
(In thousands) | ||||||||||||||||
Total rent expense | $ | 312 | $ | 189 | $ | 819 | $ | 504 | ||||||||
Legal Proceedings. The Partnership is involved in various litigation and administrative proceedings arising in the normal course of business. In the opinion of management, any liabilities that may result from these claims would not individually or in the aggregate have a material adverse effect on its financial position or results of operations. | ||||||||||||||||
In August 2012, four former DFW Midstream employees (the "Plaintiffs") who, by virtue of their Class B membership in DFW Midstream Management LLC ("DFW Management"), filed a claim in the Court of Chancery of the State of Delaware against Summit Investments, Summit Holdings, DFW Midstream and DFW Management (collectively, the "Defendants") seeking dissolution and wind-up of DFW Midstream and DFW Management or, in the alternative, a repurchase of the Plaintiffs' net profits interests and other unspecified monetary damages. In September 2012, the Defendants filed a motion to dismiss all of Plaintiffs’ claims in this matter. The court heard oral arguments on the motion to dismiss in December 2012, and Defendants' motion to dismiss was granted in March 2013. In April 2013, the Plaintiffs voluntarily dismissed their appeal. |
ACQUISITIONS
ACQUISITIONS | 9 Months Ended | |||||||||||
Sep. 30, 2013 | ||||||||||||
Business Combinations [Abstract] | ' | |||||||||||
Acquisitions | ' | |||||||||||
ACQUISITIONS | ||||||||||||
Bison Gas Gathering System. On February 15, 2013, Summit Investments acquired BTE and subsequently contributed it to SMP Holdings. On June 4, 2013, SMP Holdings entered into a purchase and sale agreement with SMLP whereby SMLP acquired the Bison Gas Gathering system. The Bison Gas Gathering system was carved out from BTE and primarily gathers natural gas production from Mountrail and Burke counties in North Dakota under long-term contracts ranging from five years to 15 years. For additional information, see Notes 1, 5 and 6. | ||||||||||||
Summit Investments accounted for its purchase of BTE (the "BTE Transaction") under the acquisition method of accounting, whereby the various gathering systems' identifiable tangible and intangible assets acquired and liabilities assumed were recorded based on their fair values as of February 15, 2013. The intangible assets that were acquired are composed of gas gathering agreement contract values and right-of-way easements. Their fair values were determined based upon assumptions related to future cash flows, discount rates, asset lives, and projected capital expenditures to complete the various systems. | ||||||||||||
Because the Bison Drop Down was executed between entities under common control, SMLP recognized the acquisition of the Bison Gas Gathering system at historical cost which reflected Summit Investments recent fair value accounting for the BTE Transaction. Furthermore, due to the common control aspect, the Bison Drop Down was accounted for by SMLP on an “as if pooled” basis for all periods in which common control existed. Common control began on February 15, 2013 concurrent with Summit Investments' acquisition of BTE. | ||||||||||||
The fair values of the assets acquired and liabilities assumed as of February 15, 2013, were as follows: | ||||||||||||
(In thousands) | ||||||||||||
Purchase price assigned to Bison Gas Gathering system | $ | 303,168 | ||||||||||
Current assets | $ | 5,705 | ||||||||||
Property, plant, and equipment | 85,477 | |||||||||||
Intangible assets | 164,502 | |||||||||||
Other noncurrent assets | 2,187 | |||||||||||
Total assets acquired | 257,871 | |||||||||||
Current liabilities | 6,112 | |||||||||||
Other noncurrent liabilities | 2,790 | |||||||||||
Total liabilities assumed | $ | 8,902 | ||||||||||
Net identifiable assets acquired | 248,969 | |||||||||||
Goodwill | $ | 54,199 | ||||||||||
We believe that the goodwill recorded represents the incremental value of future cash flow potential attributed to estimated future gathering services within the Williston Basin. | ||||||||||||
The Bison Drop Down closed on June 4, 2013. The total acquisition purchase price of $248.9 million was funded with $200.0 million of borrowings under SMLP’s revolving credit facility and the issuance of $47.9 million of SMLP common units to SMP Holdings and $1.0 million of general partner interests to SMLP’s general partner. SMP Holdings had a net investment in the Bison Gas Gathering system of $303.2 million and received total consideration of $248.9 million from SMLP. As a result, SMLP recognized a capital contribution from SMP Holdings for the contribution of net assets in excess of consideration paid. See Notes 5 and 6 for additional information. | ||||||||||||
As noted above, SMLP's acquisition of the Bison Gas Gathering system was a transaction between commonly controlled entities which required that SMLP account for the acquisition in a manner similar to a pooling of interests. As a result, the historical financial statements of the Partnership and the Bison Gas Gathering system have been combined to reflect the historical operations, financial position and cash flows from the date common control began in February 2013. Revenues and net income for the previously separate entities and the combined amounts for the nine months ended September 30, 2013, as presented in these unaudited condensed consolidated financial statements follow. | ||||||||||||
Nine months ended September 30, 2013 | ||||||||||||
(In thousands) | ||||||||||||
SMLP revenues | $ | 155,894 | ||||||||||
Bison Gas Gathering system revenues | 17,614 | |||||||||||
Combined revenues | $ | 173,508 | ||||||||||
SMLP net income | $ | 27,239 | ||||||||||
Bison Gas Gathering system net income | 52 | |||||||||||
Combined net income | $ | 27,291 | ||||||||||
See Notes 1, 5 and 6 for additional information. | ||||||||||||
Mountaineer Midstream. We completed the acquisition of Mountaineer Midstream from MarkWest for $210.0 million on June 21, 2013. The Mountaineer Midstream natural gas gathering and compression assets are located in the Appalachian Basin which includes the Marcellus Shale formation primarily in Doddridge County in northern West Virginia. The Mountaineer Midstream system consists of newly constructed, high-pressure gas gathering pipelines, certain rights-of-way associated with the pipeline, and two compressor stations. The assets gather natural gas under a long-term, fee-based contract with an affiliate of Antero Resources Corp. | ||||||||||||
The Mountaineer Acquisition was funded with $110.0 million of borrowings under the Partnership's revolving credit agreement and the issuance of $100.0 million of common and general partner interests to SMP Holdings. For the three months ended September 30, 2013, SMLP recorded $4.3 million of revenue and $1.3 million of net income related to Mountaineer Midstream. For the nine months ended September 30, 2013, SMLP recorded $4.7 million of revenue and $1.6 million of net income related to Mountaineer Midstream. | ||||||||||||
SMLP is accounting for the Mountaineer Acquisition under the acquisition method of accounting and is currently in the process of determining the assets acquired and the liabilities assumed. As of June 30, 2013, we preliminarily assigned the full $210.0 million purchase price to property plant and equipment. During the third quarter of 2013, we received additional information and, as a result, preliminarily assigned $158.3 million of the purchase price to property, plant and equipment, $27.1 million to contract intangibles, $6.5 million to rights-of-way and $18.1 million to goodwill. We have not completed the final purchase price allocation as of September 30, 2013, because we are waiting to receive additional information from MarkWest related to closing balance sheet and working capital adjustments and the finalization of the fair value estimates of the acquired assets and liabilities. | ||||||||||||
See Notes 1, 5 and 6 for additional information. | ||||||||||||
Unaudited Pro Forma Financial Information. The following unaudited pro forma financial information assumes that the acquisitions of Bison Midstream and Mountaineer Midstream occurred on January 1, 2012. The pro forma results for Bison Midstream were derived from revenues and net income in 2013 and 2012. The pro forma results for Mountaineer Midstream were derived from revenues and net income in 2013. Mountaineer Midstream was not operational until November 2012. The pro forma adjustments also reflect the impact of $310.0 million of incremental borrowings on our revolving credit facility and incremental depreciation and amortization expense associated with the acquired property, plant and equipment and contract intangibles as a result of the application of fair value accounting. Pro forma net income for the nine months ended September 30, 2013 has been adjusted to remove the impact of $2.5 million of nonrecurring transaction costs incurred during the nine months ended September 30, 2013. | ||||||||||||
Three months ended September 30, 2012 | Nine months ended September 30, | |||||||||||
2013 | 2012 | |||||||||||
(In thousands, except per-unit amounts) | ||||||||||||
Total Bison Midstream and Mountaineer Midstream revenues included in consolidated revenues | $ | — | $ | 44,176 | $ | — | ||||||
Total Bison Midstream and Mountaineer Midstream net income included in consolidated net income | — | 911 | — | |||||||||
Pro forma total revenues | $ | 50,731 | $ | 185,659 | $ | 141,372 | ||||||
Pro forma net income | 6,014 | 24,316 | 16,549 | |||||||||
Pro forma common EPU - basic and diluted | $ | 0.44 | ||||||||||
Pro forma subordinated EPU - basic and diluted | 0.44 | |||||||||||
The unaudited pro forma financial information presented above is not necessarily indicative of what our financial position or results of operations would have been if the acquisitions of Bison Midstream and Mountaineer Midstream had occurred on January 1, 2012, or what SMLP’s financial position or results of operations will be for any future periods. |
SUMMARY_OF_SIGNIFICANT_ACCOUNT1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Accounting Policies [Abstract] | ' | |||||||||||||||
Basis of Presentation and Principles of Consolidation | ' | |||||||||||||||
Basis of Presentation and Principles of Consolidation. We prepare our unaudited condensed consolidated financial statements in accordance with accounting principles generally accepted in the United States of America ("GAAP"). These principles are established by the Financial Accounting Standards Board. We make estimates and assumptions that affect the reported amounts of assets and liabilities at the balance sheet dates, including fair value measurements, the reported amounts of revenue and expense, and the disclosure of contingencies. Although management believes these estimates are reasonable, actual results could differ from its estimates. | ||||||||||||||||
For the purposes of the unaudited condensed consolidated financial statements, SMLP's results of operations reflect the Partnership's operations subsequent to the IPO and the results of the Predecessor for the period prior to the IPO. The unaudited condensed consolidated financial statements also reflect the results of operations of: (i) Bison Midstream since February 16, 2013 and (ii) Mountaineer Midstream since June 22, 2013. Because the Bison Drop Down was executed between entities under common control, SMLP recognized the acquisition of Bison Midstream at SMP Holdings' historical cost which reflected its fair value accounting for the acquisition of BTE. The excess of SMP Holdings' net investment in Bison Midstream over the purchase price paid by SMLP was recognized as an addition to partners' capital. Due to the common control aspect, the Bison Drop Down was accounted for by the Partnership on an “as if pooled” basis for all periods in which common control existed. See Notes 5, 6 and 12 for additional information. The unaudited condensed consolidated financial statements include the assets, liabilities, and results of operations of SMLP or the Predecessor and their respective wholly owned subsidiaries. All intercompany transactions among the consolidated entities have been eliminated. In our opinion, the accompanying unaudited condensed consolidated financial statements include all adjustments consisting of normal recurring accruals necessary for a fair presentation of the results of operations for the three and nine months ended September 30, 2013 and 2012. | ||||||||||||||||
These unaudited condensed consolidated financial statements have been prepared pursuant to the rules and the regulations of the Securities and Exchange Commission (the "SEC"). Certain information and note disclosures normally included in annual financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to those rules and regulations, although the Partnership believes that the disclosures made are adequate to make the information not misleading. The unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto that are included in our 2012 Annual Report. The results of operations for an interim period are not necessarily indicative of results expected for a full year. | ||||||||||||||||
We conduct our operations in the midstream sector with four operating segments. However, due to their similar characteristics and how we manage our business, we have aggregated these segments into one reportable operating segment for disclosure purposes. The assets of our reportable operating segment consist of natural gas gathering systems and related plant and equipment. Our operating segments reflect the way in which we internally report the financial information used to make decisions and allocate resources in connection with our operations. | ||||||||||||||||
Reclassification | ' | |||||||||||||||
Reclassifications. Certain reclassifications have been made to prior-year amounts to conform to current-year presentation. These reclassifications had no impact on net income or total partners' capital or membership interests. | ||||||||||||||||
Fair Value of Financial Instruments | ' | |||||||||||||||
Fair Value of Financial Instruments. The carrying amount of cash and cash equivalents (Level 1), accounts receivable, and accounts payable reported on the balance sheet approximates fair value due to their short-term maturities. | ||||||||||||||||
GAAP's fair-value-measurement standard defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The standard characterizes inputs used in determining fair value according to a hierarchy that prioritizes those inputs based upon the degree to which they are observable. The three levels of the fair value hierarchy are as follows: | ||||||||||||||||
• | Level 1. Inputs represent quoted prices in active markets for identical assets or liabilities; | |||||||||||||||
• | Level 2. Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly (for example, quoted market prices for similar assets or liabilities in active markets or quoted market prices for identical assets or liabilities in markets not considered to be active, inputs other than quoted prices that are observable for the asset or liability, or market-corroborated inputs); and | |||||||||||||||
• | Level 3. Inputs that are not observable from objective sources, such as management’s internally developed assumptions used in pricing an asset or liability (for example, an estimate of future cash flows used in management’s internally developed present value of future cash flows model that underlies the fair value measurement). | |||||||||||||||
Nonfinancial assets and liabilities initially measured at fair value include those acquired and assumed in connection with third-party business combinations. | ||||||||||||||||
A summary of the estimated fair value for financial instruments follows. | ||||||||||||||||
September 30, 2013 | December 31, 2012 | |||||||||||||||
Carrying value | Estimated | Carrying value | Estimated | |||||||||||||
fair value (Level 2) | fair value (Level 2) | |||||||||||||||
(In thousands) | ||||||||||||||||
Revolving credit facility | $ | 265,050 | $ | 265,050 | $ | 199,230 | $ | 199,230 | ||||||||
Senior notes | 300,000 | 308,500 | — | — | ||||||||||||
The revolving credit facility’s carrying value on the balance sheet is its fair value due to its floating interest rate. The fair value for the senior notes is based on an average of nonbinding broker quotes as of September 30, 2013. The use of different market assumptions or valuation methodologies may have a material effect on the estimated fair value of the senior notes. | ||||||||||||||||
Intangible Assets and Noncurrent Liability | ' | |||||||||||||||
Intangible Assets and Noncurrent Liability. Upon the acquisition of DFW Midstream, certain of our gas gathering contracts were deemed to have above-market pricing structures while another was deemed to have pricing that was below market. We have recognized the contracts that were above market at acquisition as favorable gas gathering contracts. We have recognized the contract that was deemed to be below market as a noncurrent liability. We amortize these intangibles on a units-of-production basis over the estimated useful life of the contract. We define useful life as the period over which the contract is expected to contribute directly or indirectly to our future cash flows. The related contracts have original terms ranging from 10 years to 20 years. We recognize the amortization expense associated with these intangible assets and liabilities in revenue. | ||||||||||||||||
For our other gas gathering contracts, we amortize contract intangible assets over the period of economic benefit based upon the expected revenues over the life of the contract. The useful life of these contracts ranges from 10 years to 25 years. We recognize the amortization expense associated with these intangible assets in depreciation and amortization expense. | ||||||||||||||||
We have right-of-way intangible assets associated with city easements and easements granted within existing rights-of-way. We amortize these intangible assets over the shorter of the contractual term of the rights-of-way or the estimated useful life of the gathering system. The contractual terms of the rights-of-way range from 20 years to 30 years. The estimated useful life of our gathering systems is 30 years. We recognize the amortization expense associated with these intangible assets in depreciation and amortization expense. | ||||||||||||||||
Other Noncurrent Assets | ' | |||||||||||||||
Other Noncurrent Assets. Other noncurrent assets primarily consist of external costs incurred in connection with the issuance of our senior notes and the closing of our revolving credit facility and related amendments. We capitalize and then amortize these deferred loan costs over the life of the respective debt instrument. We recognize amortization of deferred loan costs in interest expense. | ||||||||||||||||
Revenue Recognition | ' | |||||||||||||||
Revenue Recognition. We generate the majority of our revenue from the natural gas gathering services that we provide to our natural gas producer customers. We also generate revenue from our marketing of natural gas and natural gas liquids ("NGLs"). We realize revenues by receiving fees from our producer customers or by selling the residue natural gas and NGLs. | ||||||||||||||||
We recognize revenue earned from gathering services in gathering services and other fees revenue. We also earn revenue from the sale of physical natural gas purchased from our customers under percentage-of-proceeds arrangements. These revenues are recognized in natural gas, NGLs and condensate sales and other with corresponding expense recognition in cost of natural gas and NGLs. We sell the natural gas that we retain from our DFW Midstream customers to offset the power expenses of the electric-driven compression on the DFW Midstream system. We also sell condensate retained from our gathering services at Grand River Gathering. Revenues from the retainage of natural gas and condensate are recognized in natural gas, NGLs and condensate sales and other; the associated expense is included in operation and maintenance expense. | ||||||||||||||||
We recognize revenue when all of the following criteria are met: (i) persuasive evidence of an exchange arrangement exists, (ii) delivery has occurred or services have been rendered, (iii) the price is fixed or determinable, and (iv) collectability is reasonably assured. | ||||||||||||||||
We obtain access to natural gas and provide services principally under contracts that contain one or both of the following arrangements: | ||||||||||||||||
• | Fee-based arrangements. Under fee-based arrangements, we receive a fee or fees for one or more of the following services: natural gas gathering, compressing, and treating. Fee-based arrangements include natural gas purchase arrangements pursuant to which we purchase natural gas at the wellhead, or other receipt points, at a settled price at the delivery point less a specified amount, generally the same as the fees we would otherwise charge for gathering of natural gas from the wellhead location to the delivery point. The margins earned are directly related to the volume of natural gas that flows through the system. | |||||||||||||||
• | Percent-of-proceeds arrangements. Under percent-of-proceeds arrangements, we generally purchase natural gas from producers at the wellhead, or other receipt points, gather the wellhead natural gas through our gathering system, treat the natural gas, and sell the natural gas to a third party for processing. We then remit to our producers an agreed-upon percentage of the actual proceeds received from sales of the residue natural gas and NGLs. Certain of these arrangements may also result in returning all or a portion of the residue natural gas and/or the NGLs to the producer, in lieu of returning sales proceeds. | |||||||||||||||
Many of our natural gas gathering agreements provide for a monthly or annual minimum volume commitment ("MVC") from certain of our customers. Under these monthly or annual MVCs, our customers agree to ship a minimum volume of natural gas on our gathering systems or to pay a minimum monetary amount over certain periods during the term of the MVC. A customer must make a shortfall payment to us at the end of the contract month or year, as applicable, if its actual throughput volumes are less than its MVC for that month or year. Certain customers are entitled to utilize shortfall payments to offset gathering fees in one or more subsequent periods to the extent that such customer's throughput volumes in subsequent periods exceed its MVC for that period. These contract provisions range from 12 months to eight years. | ||||||||||||||||
We record customer billings for obligations under their MVCs as deferred revenue when the customer has the right to utilize shortfall payments to offset gathering fees in subsequent periods. We recognize deferred revenue under these arrangements in revenue once all contingencies or potential performance obligations associated with the related volumes have either (i) been satisfied through the gathering of future excess volumes of natural gas, or (ii) expired (or lapsed) through the passage of time pursuant to the terms of the applicable natural gas gathering agreement. We classify deferred revenue as short term for arrangements where the expiration of a customer's right to utilize shortfall payments is twelve months or less. As of September 30, 2013, we have billed $24.1 million of deferred revenue relative to shortfall payments, of which $1.1 million was included in accounts receivable, attributable to arrangements that provide the customer the ability to offset gathering fees in the next one month to eight years to the extent that a customer's throughput volumes exceed its MVC. | ||||||||||||||||
Certain customers reimburse us for costs we incur on their behalf. We record costs incurred and reimbursed by our customers on a gross basis. | ||||||||||||||||
Unit Based Compensation | ' | |||||||||||||||
Unit-Based Compensation. For awards of unit-based compensation, we determine a grant date fair value and recognize the related compensation expense, adjusted for expected forfeitures, in the statement of operations over the vesting period of the respective awards. See Note 8 for additional information. | ||||||||||||||||
Income Taxes | ' | |||||||||||||||
Income Taxes. We are not subject to federal and state income taxes, except as noted below, because we are structured as a partnership. As a result, our unitholders or members are individually responsible for paying federal and state income taxes on their share of our taxable income. | ||||||||||||||||
In general, legal entities that are chartered, organized or conducting business in the state of Texas are subject to the Revised Texas Franchise Tax (the "Texas Margin Tax"). The Texas Margin Tax has the characteristics of an income tax because it is determined by applying a tax rate to a tax base that considers both revenues and expenses. Our financial statements reflect provisions for these tax obligations. | ||||||||||||||||
Earnings per Unit | ' | |||||||||||||||
Earnings Per Unit ("EPU"). We present earnings per limited partner unit data only for periods subsequent to the closing of SMLP’s IPO in October 2012. EPU for periods ended prior to the IPO have not been presented because Summit Investments' members held membership interests and not units. | ||||||||||||||||
We determine EPU by dividing the net income that is attributed, in accordance with the net income and loss allocation provisions of the partnership agreement, to the common and subordinated unitholders under the two-class method, after deducting the general partner's 2% interest in net income and any incentive distributions paid to the general partner, by the weighted-average number of common and subordinated units outstanding during the three and nine months ended September 30, 2013. Diluted earnings per limited partner unit reflects the potential dilution that could occur if securities or other agreements to issue common units, such as unit-based compensation, were exercised, settled or converted into common units. When it is determined that potential common units resulting from an award subject to performance or market conditions should be included in the diluted earnings per limited partner unit calculation, the impact is reflected by applying the treasury stock method. | ||||||||||||||||
Comprehensive Income | ' | |||||||||||||||
Comprehensive Income. Comprehensive income is the same as net income for all periods presented. | ||||||||||||||||
Environmental Matters | ' | |||||||||||||||
Environmental Matters. We are subject to various federal, state and local laws and regulations relating to the protection of the environment. Although we believe that we are in material compliance with applicable environmental regulations, the risk of costs and liabilities are inherent in pipeline ownership and operation. Liabilities for loss contingencies, including environmental remediation costs, arising from claims, assessments, litigation, fines, and penalties and other sources are charged to expense when it is probable that a liability has been incurred and the amount of the assessment and/or remediation can be reasonably estimated. There are no such liabilities reflected in the accompanying financial statements at September 30, 2013 or December 31, 2012. However, we can provide no assurances that significant costs and liabilities will not be incurred by the Partnership in the future. We are currently not aware of any material contingent liabilities that exist with respect to environmental matters. | ||||||||||||||||
Recent Accounting Pronouncements | ' | |||||||||||||||
Recent Accounting Pronouncements. Accounting standard setters frequently issue new or revised accounting rules. We review new pronouncements to determine the impact, if any, on our financial statements. There are currently no recent pronouncements that have been issued that we believe will materially affect our financial statements. |
SUMMARY_OF_SIGNIFICANT_ACCOUNT2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Accounting Policies [Abstract] | ' | |||||||||||||||
Summary of Estimated Fair Value for Financial instruments | ' | |||||||||||||||
A summary of the estimated fair value for financial instruments follows. | ||||||||||||||||
September 30, 2013 | December 31, 2012 | |||||||||||||||
Carrying value | Estimated | Carrying value | Estimated | |||||||||||||
fair value (Level 2) | fair value (Level 2) | |||||||||||||||
(In thousands) | ||||||||||||||||
Revolving credit facility | $ | 265,050 | $ | 265,050 | $ | 199,230 | $ | 199,230 | ||||||||
Senior notes | 300,000 | 308,500 | — | — | ||||||||||||
PROPERTY_PLANT_AND_EQUIPMENT_N1
PROPERTY, PLANT, AND EQUIPMENT, NET (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Property, Plant and Equipment [Abstract] | ' | |||||||||||||||
Schedule of property, plant, and equipment, net | ' | |||||||||||||||
Details on property, plant, and equipment, net were as follows: | ||||||||||||||||
Useful lives (In years) | September 30, | December 31, | ||||||||||||||
2013 | 2012 | |||||||||||||||
(Dollars in thousands) | ||||||||||||||||
Gas gathering systems | 30 | $ | 618,528 | $ | 427,449 | |||||||||||
Compressor stations and compression equipment | 30 | 334,108 | 237,618 | |||||||||||||
Construction in progress | n/a | 50,381 | 45,919 | |||||||||||||
Other | 15-Apr | 9,680 | 4,524 | |||||||||||||
Total | 1,012,697 | 715,510 | ||||||||||||||
Accumulated depreciation | (55,142 | ) | (33,517 | ) | ||||||||||||
Property, plant, and equipment, net | $ | 957,555 | $ | 681,993 | ||||||||||||
Schedule of depreciation expense related to property, plant and equipment and capitalized interest | ' | |||||||||||||||
Depreciation expense related to property, plant, and equipment and capitalized interest were as follows: | ||||||||||||||||
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
(In thousands) | ||||||||||||||||
Depreciation expense | $ | 8,429 | $ | 5,623 | $ | 21,625 | $ | 15,682 | ||||||||
Capitalized interest | 1,838 | 310 | 2,808 | 2,191 | ||||||||||||
IDENTIFIABLE_INTANGIBLE_ASSETS1
IDENTIFIABLE INTANGIBLE ASSETS AND NONCURRENT LIABILITY (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ' | |||||||||||||||
Schedule of identifiable intangible assets and a noncurrent liability, which are subject to amortization | ' | |||||||||||||||
Identifiable intangible assets and the noncurrent liability, which are subject to amortization, were as follows: | ||||||||||||||||
September 30, 2013 | ||||||||||||||||
Useful lives | Gross carrying amount | Accumulated amortization | Net | |||||||||||||
(In years) | ||||||||||||||||
(Dollars in thousands) | ||||||||||||||||
Favorable gas gathering contracts | 18.7 | $ | 24,195 | $ | (5,847 | ) | $ | 18,348 | ||||||||
Contract intangibles | 16.8 | 429,575 | (34,771 | ) | 394,804 | |||||||||||
Rights-of-way | 28.3 | 55,773 | (4,116 | ) | 51,657 | |||||||||||
Total amortizable intangible assets | $ | 509,543 | $ | (44,734 | ) | $ | 464,809 | |||||||||
Unfavorable gas gathering contract | 10 | $ | 10,962 | $ | (4,358 | ) | $ | 6,604 | ||||||||
December 31, 2012 | ||||||||||||||||
Useful lives | Gross carrying amount | Accumulated amortization | Net | |||||||||||||
(In years) | ||||||||||||||||
(Dollars in thousands) | ||||||||||||||||
Favorable gas gathering contracts | 18.7 | $ | 24,195 | $ | (4,237 | ) | $ | 19,958 | ||||||||
Contract intangibles | 12.4 | 244,100 | (14,504 | ) | 229,596 | |||||||||||
Rights-of-way | 28.3 | 38,848 | (2,862 | ) | 35,986 | |||||||||||
Total amortizable intangible assets | $ | 307,143 | $ | (21,603 | ) | $ | 285,540 | |||||||||
Unfavorable gas gathering contract | 10 | $ | 10,962 | $ | (3,542 | ) | $ | 7,420 | ||||||||
Schedule of recognized amortization expense within the statements of operations | ' | |||||||||||||||
We recognized amortization expense as follows: | ||||||||||||||||
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
(In thousands) | ||||||||||||||||
Amortization expense – favorable gas gathering contracts | $ | 511 | $ | 501 | $ | 1,610 | $ | 1,181 | ||||||||
Amortization expense – contract intangibles | 7,559 | 3,194 | 20,267 | 9,483 | ||||||||||||
Amortization expense – rights-of-way | 438 | 340 | 1,254 | 970 | ||||||||||||
Amortization expense – unfavorable gas gathering contract | (247 | ) | (341 | ) | (816 | ) | (1,206 | ) | ||||||||
Schedule of estimated aggregate amortization of intangible assets and the noncurrent liability for each of the five succeeding fiscal years | ' | |||||||||||||||
The estimated aggregate annual amortization of intangible assets and noncurrent liability expected to be recognized as of September 30, 2013 for the remainder of 2013 and each of the four succeeding fiscal years follows. | ||||||||||||||||
Assets | Liabilities | |||||||||||||||
(In thousands) | ||||||||||||||||
2013 | $ | 8,801 | $ | 378 | ||||||||||||
2014 | 36,949 | 1,549 | ||||||||||||||
2015 | 39,628 | 1,650 | ||||||||||||||
2016 | 39,754 | 1,571 | ||||||||||||||
2017 | 38,316 | 1,456 | ||||||||||||||
Schedule of Goodwill | ' | |||||||||||||||
A rollforward of the consolidated balance of goodwill for the nine months ended September 30, 2013 follows. | ||||||||||||||||
(In thousands) | ||||||||||||||||
Goodwill, beginning of period | $ | 45,478 | ||||||||||||||
Goodwill recognized in connection with the Bison Drop Down | 54,199 | |||||||||||||||
Goodwill preliminarily recognized in connection with the Mountaineer Acquisition | 18,089 | |||||||||||||||
Goodwill, end of period | $ | 117,766 | ||||||||||||||
PARTNERS_CAPITAL_AND_MEMBERSHI1
PARTNERS' CAPITAL AND MEMBERSHIP INTERESTS (Tables) | 9 Months Ended | ||||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||||
Business Acquisition [Line Items] | ' | ||||||||||||||||||||||
Schedule of Partner Units Activity | ' | ||||||||||||||||||||||
A rollforward of the number of common limited partner, subordinated limited partner and general partner units from December 31, 2012 to September 30, 2013 follows. | |||||||||||||||||||||||
Common | Subordinated | General partner | Total | ||||||||||||||||||||
Units, beginning of period | 24,412,427 | 24,409,850 | 996,320 | 49,818,597 | |||||||||||||||||||
Units issued to SMP Holdings in connection with the Bison Drop Down | 1,553,849 | — | 31,711 | 1,585,560 | |||||||||||||||||||
Units issued to SMP Holdings in connection with the Mountaineer Acquisition | 3,107,698 | — | 63,422 | 3,171,120 | |||||||||||||||||||
Units issued | 1,473 | — | — | 1,473 | |||||||||||||||||||
Units, end of period | 29,075,447 | 24,409,850 | 1,091,453 | 54,576,750 | |||||||||||||||||||
Schedule of partnership target distributions | ' | ||||||||||||||||||||||
The following table illustrates the percentage allocations of available cash between the unitholders and our general partner based on the specified target distribution levels. The amounts set forth in the column Marginal Percentage Interest in Distributions are the percentage interests of our general partner and the unitholders in any available cash we distribute up to and including the corresponding amount in the column Total Quarterly Distribution Per Unit Target Amount. The percentage interests shown for our unitholders and our general partner for the minimum quarterly distribution are also applicable to quarterly distribution amounts that are less than the minimum quarterly distribution. The percentage interests set forth below for our general partner include its 2.0% general partner interest and assume that our general partner has contributed any additional capital necessary to maintain its 2.0% general partner interest, our general partner has not transferred its incentive distribution rights and that there are no arrearages on common units. | |||||||||||||||||||||||
Total quarterly distribution per unit target amount | Marginal percentage interest in distributions | ||||||||||||||||||||||
Unitholders | General partner | ||||||||||||||||||||||
Minimum quarterly distribution | $0.40 | 98.00% | 2.00% | ||||||||||||||||||||
First target distribution | $0.40 up to $0.46 | 98.00% | 2.00% | ||||||||||||||||||||
Second target distribution | above $0.46 up to $0.50 | 85.00% | 15.00% | ||||||||||||||||||||
Third target distribution | above $0.50 up to $0.60 | 75.00% | 25.00% | ||||||||||||||||||||
Thereafter | above $0.60 | 50.00% | 50.00% | ||||||||||||||||||||
Details of Cash Distributions | ' | ||||||||||||||||||||||
Details of cash distributions declared during 2013 follow. | |||||||||||||||||||||||
Attributable to the | Payment date | Per-unit distribution | Cash paid (or payable) to common unitholders | Cash paid (or payable) to subordinated unitholders | Cash paid (or payable) to general partner | Total distribution | |||||||||||||||||
quarter ended | |||||||||||||||||||||||
(Dollars in thousands, except per-unit amounts) | |||||||||||||||||||||||
December 31, 2012 | February 14, 2013 | $ | 0.41 | $ | 10,009 | $ | 10,008 | $ | 408 | $ | 20,425 | ||||||||||||
March 31, 2013 | May 15, 2013 | 0.42 | 10,253 | 10,252 | 418 | 20,923 | |||||||||||||||||
June 30, 2013 | August 14, 2013 | 0.435 | 12,647 | 10,618 | 475 | 23,740 | |||||||||||||||||
September 30, 2013 | November 14, 2013 | 0.46 | 13,377 | 11,229 | 502 | 25,108 | |||||||||||||||||
Bison Midstream | ' | ||||||||||||||||||||||
Business Acquisition [Line Items] | ' | ||||||||||||||||||||||
Schedule of Business Acquisition | ' | ||||||||||||||||||||||
In exchange for its $305.4 million net investment in Bison Midstream, SMLP paid SMP Holdings and the general partner total cash and unit consideration of $248.9 million. As a result of the contribution of net assets in excess of consideration, SMLP recognized a capital contribution from SMP Holdings. The details of total cash and unit consideration as well as the calculation of the capital contribution and its allocation to partners' capital follow. | |||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||
SMP Holdings' net investment in Bison Midstream | $ | 305,449 | |||||||||||||||||||||
Aggregate cash paid to SMP Holdings | $ | 200,000 | |||||||||||||||||||||
Issuance of 1,553,849 SMLP common units to SMP Holdings | 47,936 | ||||||||||||||||||||||
Issuance of 31,711 SMLP general partner units to the general partner | 978 | ||||||||||||||||||||||
Total consideration | 248,914 | ||||||||||||||||||||||
SMP Holdings' contribution of net assets in excess of consideration | $ | 56,535 | |||||||||||||||||||||
Allocation of capital contribution: | |||||||||||||||||||||||
General partner interest | $ | 1,131 | |||||||||||||||||||||
Common limited partner interest | 28,558 | ||||||||||||||||||||||
Subordinated limited partner interest | 26,846 | ||||||||||||||||||||||
Partners' capital allocation | $ | 56,535 | |||||||||||||||||||||
The fair values of the assets acquired and liabilities assumed as of February 15, 2013, were as follows: | |||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||
Purchase price assigned to Bison Gas Gathering system | $ | 303,168 | |||||||||||||||||||||
Current assets | $ | 5,705 | |||||||||||||||||||||
Property, plant, and equipment | 85,477 | ||||||||||||||||||||||
Intangible assets | 164,502 | ||||||||||||||||||||||
Other noncurrent assets | 2,187 | ||||||||||||||||||||||
Total assets acquired | 257,871 | ||||||||||||||||||||||
Current liabilities | 6,112 | ||||||||||||||||||||||
Other noncurrent liabilities | 2,790 | ||||||||||||||||||||||
Total liabilities assumed | $ | 8,902 | |||||||||||||||||||||
Net identifiable assets acquired | 248,969 | ||||||||||||||||||||||
Goodwill | $ | 54,199 | |||||||||||||||||||||
Mountaineer Midstream | ' | ||||||||||||||||||||||
Business Acquisition [Line Items] | ' | ||||||||||||||||||||||
Schedule of Business Acquisition | ' | ||||||||||||||||||||||
The allocation and valuation of units issued to SMP Holdings and the general partner to partially fund the Mountaineer Acquisition follow. | |||||||||||||||||||||||
(Dollars in thousands) | |||||||||||||||||||||||
Issuance of 3,107,698 SMLP common units to SMP Holdings | $ | 98,000 | |||||||||||||||||||||
Issuance of 63,422 SMLP general partner units to the general partner | 2,000 | ||||||||||||||||||||||
Issuance of units in connection with the Mountaineer Acquisition | $ | 100,000 | |||||||||||||||||||||
EARNINGS_PER_UNIT_Tables
EARNINGS PER UNIT (Tables) | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Earnings Per Share [Abstract] | ' | |||||||
Schedule of earnings per Unit | ' | |||||||
The following table presents details on EPU. | ||||||||
Three months ended September 30, 2013 | Nine months ended September 30, 2013 | |||||||
(Dollars in thousands, except | ||||||||
per-unit amounts) | ||||||||
Net income | $ | 6,691 | $ | 27,291 | ||||
Less: net income attributable to SMP Holdings | — | 52 | ||||||
Net income attributable to partners | 6,691 | 27,239 | ||||||
Less: net income attributable to general partner | 134 | 545 | ||||||
Net income attributable to limited partners | $ | 6,557 | $ | 26,694 | ||||
Net income attributable to common units | $ | 3,567 | $ | 14,899 | ||||
Weighted-average common units outstanding – basic | 29,074,743 | 26,234,042 | ||||||
Earnings per common unit – basic | $ | 0.12 | $ | 0.57 | ||||
Weighted-average common units outstanding – diluted | 29,227,041 | 26,352,234 | ||||||
Earnings per common unit – diluted | $ | 0.12 | $ | 0.57 | ||||
Net income attributable to subordinated units | $ | 2,990 | $ | 11,795 | ||||
Weighted-average subordinated units outstanding – basic and diluted | 24,409,850 | 24,409,850 | ||||||
Earnings per subordinated unit – basic and diluted | $ | 0.12 | $ | 0.48 | ||||
UNITBASED_COMPENSATION_Tables
UNIT-BASED COMPENSATION (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Phantom and restricted units | ' | |||||||||||||||
MEMBERSHIP INTERESTS | ' | |||||||||||||||
Schedule of activity | ' | |||||||||||||||
The following table presents phantom and restricted unit activity: | ||||||||||||||||
Units | Weighted-average grant date fair value | |||||||||||||||
Nonvested phantom and restricted units, January 1, 2013 | 131,558 | $ | 20 | |||||||||||||
Phantom units granted | 155,330 | $ | 26.33 | |||||||||||||
Restricted units granted | 835 | $ | 27.5 | |||||||||||||
Phantom units forfeited | (4,041 | ) | $ | 25.99 | ||||||||||||
Nonvested phantom and restricted units, September 30, 2013 | 283,682 | $ | 23.41 | |||||||||||||
Long-term Incentive Plan | ' | |||||||||||||||
MEMBERSHIP INTERESTS | ' | |||||||||||||||
Schedule of non-cash compensation expense recognized in general and administrative expense | ' | |||||||||||||||
compensation recognized in general and administrative expense related to awards under the LTIP was as follows: | ||||||||||||||||
Three months ended September 30, 2013 | Nine months ended September 30, 2013 | |||||||||||||||
(In thousands) | ||||||||||||||||
SMLP unit-based compensation | $ | 829 | $ | 1,970 | ||||||||||||
DFW Net Profits Interests | ' | |||||||||||||||
MEMBERSHIP INTERESTS | ' | |||||||||||||||
Schedule of non-cash compensation expense recognized in general and administrative expense | ' | |||||||||||||||
compensation recognized in general and administrative expense related to the DFW Net Profits Interests was as follows: | ||||||||||||||||
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
(In thousands) | ||||||||||||||||
Class B membership interest unit-based compensation | $ | — | $ | 75 | $ | 17 | $ | 874 | ||||||||
CONCENTRATIONS_OF_RISK_Tables
CONCENTRATIONS OF RISK (Tables) | 9 Months Ended | |||||||||||
Sep. 30, 2013 | ||||||||||||
Revenue | Customer concentration | ' | |||||||||||
CONCENTRATIONS OF RISK | ' | |||||||||||
Schedule of customers accounting for more than 10% of total revenues | ' | |||||||||||
accounting for more than 10% of total revenues were as follows: | ||||||||||||
Three months ended September 30, | Nine months ended September 30, | |||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||
Revenue: | ||||||||||||
Counterparty A | 17 | % | 29 | % | 19 | % | 19 | % | ||||
Counterparty B | 16 | % | 29 | % | 18 | % | 27 | % | ||||
Counterparty C | 10 | % | — | % | 9 | % | — | % | ||||
Counterparty D | 10 | % | — | % | 9 | % | — | % | ||||
Counterparty E | * | 13 | % | * | 14 | % | ||||||
__________ | ||||||||||||
* Less than 10% | ||||||||||||
Accounts receivable | Credit concentration | ' | |||||||||||
CONCENTRATIONS OF RISK | ' | |||||||||||
Schedule of customers accounting for more than 10% of total revenues | ' | |||||||||||
accounting for more than 10% of total accounts receivable were as follows: | ||||||||||||
September 30, | December 31, | |||||||||||
2013 | 2012 | |||||||||||
Accounts receivable: | ||||||||||||
Counterparty A | 23 | % | 24 | % | ||||||||
Counterparty B | 21 | % | 38 | % | ||||||||
Counterparty C | * | — | % | |||||||||
Counterparty D | * | — | % | |||||||||
Counterparty E | * | * | ||||||||||
__________ | ||||||||||||
* Less than 10% |
RELATEDPARTY_TRANSACTIONS_Tabl
RELATED-PARTY TRANSACTIONS (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Related Party Transactions [Abstract] | ' | |||||||||||||||
Schedules of Related Party Transactions | ' | |||||||||||||||
The payable to our general partner for expenses that were paid on our behalf and the receivable from the general partner for expenses that we paid that were not allocated to the Partnership were as follows: | ||||||||||||||||
September 30, | December 31, | |||||||||||||||
2013 | 2012 | |||||||||||||||
(In thousands) | ||||||||||||||||
Due to affiliate | $ | 430 | $ | — | ||||||||||||
Due from affiliate | — | 774 | ||||||||||||||
Expenses incurred and allocated to us by the general partner under our partnership agreement were as follows: | ||||||||||||||||
Three months ended September 30, 2013 | Nine months ended September 30, 2013 | |||||||||||||||
(In thousands) | ||||||||||||||||
General and administrative expense allocation | $ | 794 | $ | 2,600 | ||||||||||||
Electricity Management Services Agreement. We entered into a consulting arrangement with EquiPower Resources Corp. to assist with managing DFW Midstream's electricity price risk. EquiPower Resources Corp. is an affiliate of Energy Capital Partners. Amounts paid for such services were as follows: | ||||||||||||||||
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
(In thousands) | ||||||||||||||||
Payments for electricity management consulting services | $ | 54 | $ | 56 | $ | 163 | $ | 144 | ||||||||
COMMITMENTS_AND_CONTINGENCIES_
COMMITMENTS AND CONTINGENCIES (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | ' | |||||||||||||||
Schedule of total rent expense related to operating leases | ' | |||||||||||||||
Total rent expense related to operating leases, which is recognized in general and administrative expenses, was as follows: | ||||||||||||||||
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
(In thousands) | ||||||||||||||||
Total rent expense | $ | 312 | $ | 189 | $ | 819 | $ | 504 | ||||||||
ACQUISITIONS_Tables
ACQUISITIONS (Tables) | 9 Months Ended | |||||||||||
Sep. 30, 2013 | ||||||||||||
Business Acquisition [Line Items] | ' | |||||||||||
Business Acquisition, Pro Forma Information | ' | |||||||||||
Three months ended September 30, 2012 | Nine months ended September 30, | |||||||||||
2013 | 2012 | |||||||||||
(In thousands, except per-unit amounts) | ||||||||||||
Total Bison Midstream and Mountaineer Midstream revenues included in consolidated revenues | $ | — | $ | 44,176 | $ | — | ||||||
Total Bison Midstream and Mountaineer Midstream net income included in consolidated net income | — | 911 | — | |||||||||
Pro forma total revenues | $ | 50,731 | $ | 185,659 | $ | 141,372 | ||||||
Pro forma net income | 6,014 | 24,316 | 16,549 | |||||||||
Pro forma common EPU - basic and diluted | $ | 0.44 | ||||||||||
Pro forma subordinated EPU - basic and diluted | 0.44 | |||||||||||
Bison Midstream | ' | |||||||||||
Business Acquisition [Line Items] | ' | |||||||||||
Fair Value of Assets Acquired and Liabilities Assumed | ' | |||||||||||
In exchange for its $305.4 million net investment in Bison Midstream, SMLP paid SMP Holdings and the general partner total cash and unit consideration of $248.9 million. As a result of the contribution of net assets in excess of consideration, SMLP recognized a capital contribution from SMP Holdings. The details of total cash and unit consideration as well as the calculation of the capital contribution and its allocation to partners' capital follow. | ||||||||||||
(Dollars in thousands) | ||||||||||||
SMP Holdings' net investment in Bison Midstream | $ | 305,449 | ||||||||||
Aggregate cash paid to SMP Holdings | $ | 200,000 | ||||||||||
Issuance of 1,553,849 SMLP common units to SMP Holdings | 47,936 | |||||||||||
Issuance of 31,711 SMLP general partner units to the general partner | 978 | |||||||||||
Total consideration | 248,914 | |||||||||||
SMP Holdings' contribution of net assets in excess of consideration | $ | 56,535 | ||||||||||
Allocation of capital contribution: | ||||||||||||
General partner interest | $ | 1,131 | ||||||||||
Common limited partner interest | 28,558 | |||||||||||
Subordinated limited partner interest | 26,846 | |||||||||||
Partners' capital allocation | $ | 56,535 | ||||||||||
The fair values of the assets acquired and liabilities assumed as of February 15, 2013, were as follows: | ||||||||||||
(In thousands) | ||||||||||||
Purchase price assigned to Bison Gas Gathering system | $ | 303,168 | ||||||||||
Current assets | $ | 5,705 | ||||||||||
Property, plant, and equipment | 85,477 | |||||||||||
Intangible assets | 164,502 | |||||||||||
Other noncurrent assets | 2,187 | |||||||||||
Total assets acquired | 257,871 | |||||||||||
Current liabilities | 6,112 | |||||||||||
Other noncurrent liabilities | 2,790 | |||||||||||
Total liabilities assumed | $ | 8,902 | ||||||||||
Net identifiable assets acquired | 248,969 | |||||||||||
Goodwill | $ | 54,199 | ||||||||||
Schedule of Revenue and Net Income Disclosures | ' | |||||||||||
Revenues and net income for the previously separate entities and the combined amounts for the nine months ended September 30, 2013, as presented in these unaudited condensed consolidated financial statements follow. | ||||||||||||
Nine months ended September 30, 2013 | ||||||||||||
(In thousands) | ||||||||||||
SMLP revenues | $ | 155,894 | ||||||||||
Bison Gas Gathering system revenues | 17,614 | |||||||||||
Combined revenues | $ | 173,508 | ||||||||||
SMLP net income | $ | 27,239 | ||||||||||
Bison Gas Gathering system net income | 52 | |||||||||||
Combined net income | $ | 27,291 | ||||||||||
Mountaineer Midstream | ' | |||||||||||
Business Acquisition [Line Items] | ' | |||||||||||
Fair Value of Assets Acquired and Liabilities Assumed | ' | |||||||||||
The allocation and valuation of units issued to SMP Holdings and the general partner to partially fund the Mountaineer Acquisition follow. | ||||||||||||
(Dollars in thousands) | ||||||||||||
Issuance of 3,107,698 SMLP common units to SMP Holdings | $ | 98,000 | ||||||||||
Issuance of 63,422 SMLP general partner units to the general partner | 2,000 | |||||||||||
Issuance of units in connection with the Mountaineer Acquisition | $ | 100,000 | ||||||||||
ORGANIZATION_AND_BUSINESS_OPER1
ORGANIZATION AND BUSINESS OPERATIONS (Details) | 9 Months Ended | 0 Months Ended | 1 Months Ended | 0 Months Ended | 1 Months Ended | |||||||
Sep. 30, 2013 | Dec. 31, 2012 | Oct. 03, 2012 | Oct. 03, 2012 | Oct. 03, 2012 | Mar. 31, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Jun. 04, 2013 | Oct. 03, 2012 | Mar. 31, 2013 | |
segment | Holdings | DFW Midstream | Grand River Gathering, LLC | Summit Midstream Partners Holdings, LLC | SMP Holdings | Common units | Subordinated units | General partner | General partner | General partner | ||
SMP Holdings | SMP Holdings | |||||||||||
ORGANIZATION AND BUSINESS OPERATIONS | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cumulative percentage ownership after all transactions | ' | ' | 100.00% | 100.00% | 100.00% | ' | ' | ' | ' | ' | ' | ' |
General partner interest (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2.00% | 2.00% | 2.00% |
Limited Liability Company (LLC) or Limited Partnership (LP), Members or Limited Partners, Ownership Interest | ' | ' | ' | ' | ' | 100.00% | ' | ' | ' | ' | ' | ' |
Common limited partner capital, units outstanding | 29,073,974 | 24,412,427 | ' | ' | ' | ' | ' | 14,691,397 | 24,409,850 | ' | ' | ' |
General partner interests, units outstanding | 1,091,453 | 996,320 | ' | ' | ' | ' | 1,091,453 | ' | ' | ' | ' | ' |
Number of operating segments | 4 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of reportable segments | 1 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
SUMMARY_OF_SIGNIFICANT_ACCOUNT3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Revolving credit facility, Carrying value | $265,050,000 | $199,230,000 |
Senior notes, Carrying value | 300,000,000 | 0 |
Fair value, Level 2 inputs | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Revolving credit facility, Estimated fair value (Level 2) | 265,050,000 | 199,230,000 |
Senior notes, Estimated fair value (Level 2) | $308,500,000 | $0 |
SUMMARY_OF_SIGNIFICANT_ACCOUNT4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES SUMMARY OF SIGNIFICANT ACCOUNITNG POLICIES (Details 1) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2013 | Dec. 31, 2012 | |
Favorable gas gathering contract | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Useful lives | '18 years 8 months 12 days | '18 years 8 months 12 days |
Favorable gas gathering contract | Minimum | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Useful lives | '10 years | ' |
Favorable gas gathering contract | Maximum | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Useful lives | '20 years | ' |
Other gas gathering contract | Minimum | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Useful lives | '10 years | ' |
Other gas gathering contract | Maximum | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Useful lives | '25 years | ' |
Rights-of-way | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Useful lives | '28 years 3 months 18 days | '28 years 3 months 18 days |
Rights-of-way | Minimum | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Useful lives | '20 years | ' |
Rights-of-way | Maximum | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Useful lives | '30 years | ' |
Gathering systems | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Useful lives | '30 years | ' |
SUMMARY_OF_SIGNIFICANT_ACCOUNT5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 2) (USD $) | 9 Months Ended | 0 Months Ended | 1 Months Ended | 9 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2013 | Jun. 04, 2013 | Oct. 03, 2012 | Mar. 31, 2013 | Sep. 30, 2013 | Sep. 30, 2013 |
General partner | General partner | General partner | Minimum | Maximum | ||
Significant Accounting Policies [Line Items] | ' | ' | ' | ' | ' | ' |
Period to utilize shortfall payments to offset gathering fees to the extent that customer's throughput volumes exceed its MVC | ' | ' | ' | ' | '12 months | '8 years |
Shortfall payments billed | $24.10 | ' | ' | ' | ' | ' |
Shortfall payments billed and included in accounts receivable | $1.10 | ' | ' | ' | ' | ' |
Period to utilize the current portion of shortfall payments to offset gathering fees to the extent that customer's throughput volumes exceed its MVC | ' | ' | ' | ' | '1 month | '8 years |
General partner interest (as a percent) | ' | 2.00% | 2.00% | 2.00% | ' | ' |
PROPERTY_PLANT_AND_EQUIPMENT_N2
PROPERTY, PLANT, AND EQUIPMENT, NET (Details) (USD $) | 3 Months Ended | 9 Months Ended | |||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 |
PROPERTY, PLANT, AND EQUIPMENT, NET | ' | ' | ' | ' | ' |
Gross | $1,012,697 | ' | $1,012,697 | ' | $715,510 |
Less accumulated depreciation | -55,142 | ' | -55,142 | ' | -33,517 |
Property, plant, and equipment, net | 957,555 | ' | 957,555 | ' | 681,993 |
Depreciation expense | 8,429 | 5,623 | 21,625 | 15,682 | ' |
Capitalized interest | 1,838 | 310 | 2,808 | 2,191 | ' |
Gas gathering system | ' | ' | ' | ' | ' |
PROPERTY, PLANT, AND EQUIPMENT, NET | ' | ' | ' | ' | ' |
Useful lives | ' | ' | '30 years | ' | ' |
Gross | 618,528 | ' | 618,528 | ' | 427,449 |
Compressor stations and compression equipment | ' | ' | ' | ' | ' |
PROPERTY, PLANT, AND EQUIPMENT, NET | ' | ' | ' | ' | ' |
Useful lives | ' | ' | '30 years | ' | ' |
Gross | 334,108 | ' | 334,108 | ' | 237,618 |
Construction in progress | ' | ' | ' | ' | ' |
PROPERTY, PLANT, AND EQUIPMENT, NET | ' | ' | ' | ' | ' |
Gross | 50,381 | ' | 50,381 | ' | 45,919 |
Other | ' | ' | ' | ' | ' |
PROPERTY, PLANT, AND EQUIPMENT, NET | ' | ' | ' | ' | ' |
Gross | $9,680 | ' | $9,680 | ' | $4,524 |
Other | Minimum | ' | ' | ' | ' | ' |
PROPERTY, PLANT, AND EQUIPMENT, NET | ' | ' | ' | ' | ' |
Useful lives | ' | ' | '4 years | ' | ' |
Other | Maximum | ' | ' | ' | ' | ' |
PROPERTY, PLANT, AND EQUIPMENT, NET | ' | ' | ' | ' | ' |
Useful lives | ' | ' | '15 years | ' | ' |
IDENTIFIABLE_INTANGIBLE_ASSETS2
IDENTIFIABLE INTANGIBLE ASSETS AND NONCURRENT LIABILITY (Details) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | 9 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | Sep. 30, 2013 | Jun. 30, 2013 | Dec. 31, 2011 | Sep. 30, 2013 | Jun. 04, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 |
Mountaineer Midstream | Mountaineer Midstream | Grand River Gathering, LLC | Bison Midstream | Bison Midstream | Favorable gas gathering contract | Favorable gas gathering contract | Favorable gas gathering contract | Favorable gas gathering contract | Favorable gas gathering contract | Contract intangibles | Contract intangibles | Contract intangibles | Contract intangibles | Contract intangibles | Rights-of-way | Rights-of-way | Rights-of-way | Rights-of-way | Rights-of-way | ||||||
Finite-Lived Intangible Assets [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Useful lives | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '18 years 8 months 12 days | ' | '18 years 8 months 12 days | ' | ' | '16 years 9 months 15 days | ' | '12 years 4 months 24 days | ' | ' | '28 years 3 months 18 days | ' | '28 years 3 months 18 days |
Gross carrying amount | $509,543 | ' | $509,543 | ' | $307,143 | ' | ' | ' | ' | ' | $24,195 | ' | $24,195 | ' | $24,195 | $429,575 | ' | $429,575 | ' | $244,100 | $55,773 | ' | $55,773 | ' | $38,848 |
Accumulated amortization | -44,734 | ' | -44,734 | ' | -21,603 | ' | ' | ' | ' | ' | -5,847 | ' | -5,847 | ' | -4,237 | -34,771 | ' | -34,771 | ' | -14,504 | -4,116 | ' | -4,116 | ' | -2,862 |
Total intangible assets, net | 464,809 | ' | 464,809 | ' | 285,540 | ' | ' | ' | ' | ' | 18,348 | ' | 18,348 | ' | 19,958 | 394,804 | ' | 394,804 | ' | 229,596 | 51,657 | ' | 51,657 | ' | 35,986 |
Noncurrent liability | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Unfavorable gas gathering contract, useful lives | ' | ' | '10 years | ' | '10 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Unfavorable contract, Gross Carrying Amount | 10,962 | ' | 10,962 | ' | 10,962 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Unfavorable gas gathering contract, Accumulated Amortization | -4,358 | ' | -4,358 | ' | -3,542 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Unfavorable gas gathering contract, Net | 6,604 | ' | 6,604 | ' | 7,420 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amortization expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amortization expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 511 | 501 | 1,610 | 1,181 | ' | 7,559 | 3,194 | 20,267 | 9,483 | ' | 438 | 340 | 1,254 | 970 | ' |
Amortization expense - unfavorable contract | -247 | -341 | -816 | -1,206 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Assets | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2013 | 8,801 | ' | 8,801 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2014 | 36,949 | ' | 36,949 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2015 | 39,628 | ' | 39,628 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2016 | 39,754 | ' | 39,754 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2017 | 38,316 | ' | 38,316 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Liabilities | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2013 | 378 | ' | 378 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2014 | 1,549 | ' | 1,549 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2015 | 1,650 | ' | 1,650 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2016 | 1,571 | ' | 1,571 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2017 | 1,456 | ' | 1,456 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Goodwill [Roll Forward] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Goodwill, beginning balance | ' | ' | 45,478 | ' | ' | ' | 18,100 | 45,500 | ' | 54,199 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Goodwill recognized in connection with the Bison Drop Down | ' | ' | ' | ' | ' | 18,089 | ' | ' | 54,199 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Goodwill, ending balance | $117,766 | ' | $117,766 | ' | $45,478 | ' | $18,100 | $45,500 | $54,200 | $54,199 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
LONGTERM_DEBT_Details
LONG-TERM DEBT (Details) (USD $) | 1 Months Ended | 9 Months Ended | 9 Months Ended | 9 Months Ended | 0 Months Ended | |||||||||||||||
Jun. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | 31-May-12 | Nov. 01, 2013 | Nov. 01, 2013 | Nov. 01, 2013 | Nov. 01, 2013 | Nov. 01, 2013 | Sep. 30, 2013 | Nov. 01, 2013 | |
Bison Midstream | Mountaineer Midstream | Revolving credit facility | Revolving credit facility | Revolving credit facility | Revolving credit facility | Revolving credit facility | Revolving credit facility | Revolving credit facility | Revolving credit facility | Revolving credit facility | Revolving credit facility | Revolving credit facility | Revolving credit facility | Revolving credit facility | Revolving credit facility | |||||
Holdings | Holdings | Holdings | Holdings | Senior Secured Debt | Senior Secured Debt | Senior Secured Debt | Senior Secured Debt | Senior Secured Debt | Senior Secured Debt | Senior Secured Debt | Senior Secured Debt | Senior Secured Debt | ||||||||
Minimum | Maximum | Subsequent Event | Minimum | Maximum | LIBOR | LIBOR | Accordion provision | Accordion provision | ||||||||||||
Subsequent Event | Subsequent Event | Minimum | Maximum | Subsequent Event | ||||||||||||||||
Subsequent Event | Subsequent Event | |||||||||||||||||||
REVOLVING CREDIT FACILITY | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revolving credit facility | ' | $265,050,000 | ' | $199,230,000 | $200,000,000 | $110,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Senior unsecured notes | ' | 300,000,000 | ' | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total long-term debt | ' | 565,050,000 | ' | 199,230,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Senior secured revolving credit facility, total commitments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 600,000,000 | 550,000,000 | 700,000,000 | ' | ' | ' | ' | 50,000,000 | 200,000,000 |
Repayments of Lines of Credit | 294,200,000 | 294,180,000 | 15,770,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest rate reduction | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.75% | ' | ' | ' | ' | ' | ' |
Variable rate basis | ' | ' | ' | ' | ' | ' | ' | 'LIBOR | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Applicable margin (as a percent) | ' | ' | ' | ' | ' | ' | ' | 3.25% | ' | ' | ' | ' | ' | ' | ' | ' | 1.75% | 2.75% | ' | ' |
Weighted-average interest rate (as a percent) | ' | ' | ' | ' | ' | ' | ' | 3.43% | 2.98% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Unused portion under the facility | ' | ' | ' | ' | ' | ' | ' | 334,900,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Commitment fee on unused portion of the facility (as a percent) | ' | ' | ' | ' | ' | ' | ' | 0.50% | ' | ' | ' | ' | ' | ' | 0.30% | 0.50% | ' | ' | ' | ' |
Cumulative lease payment obligations allowable under terms of covenants | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 30,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Period that cumulative lease payment obligations may not exceed specified amount under terms of covenants | ' | ' | ' | ' | ' | ' | ' | '12 months | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Trailing period used in calculating the ratio of EBITDA to net interest expense | ' | ' | ' | ' | ' | ' | ' | '12 months | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Ratio of consolidated EBITDA to net interest expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2.5 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Trailing period used in calculating the ratio of total indebtedness to consolidated EBITDA | ' | ' | ' | ' | ' | ' | ' | '12 months | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Ratio of total indebtedness to consolidated EBITDA | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Ratio of total indebtedness to consolidated EBITDA, for a specified period following certain acquisitions | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5.5 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Period following certain acquisitions, for which higher ratio of total indebtedness to consolidated EBITDA is to be maintained | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '6 months | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Defaults on revolving credit facility | ' | ' | ' | ' | ' | ' | $0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
LONGTERM_DEBT_LONGTERM_DEBT_Se
LONG-TERM DEBT LONG-TERM DEBT (Senior Note) (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 | Jun. 30, 2013 | Jun. 17, 2013 | Jun. 30, 2013 | Jun. 30, 2013 | Jun. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 |
Senior Notes | Senior Notes | Senior Notes | Senior Notes | Senior Notes | Senior Notes | Senior Notes | Senior Notes | Finance Corp. | |||
Maximum | Term 1 | Subsequent Terms | Prior to July 1 2016 | On or After July 1 2016 | July 1 2019 | ||||||
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cumulative percentage ownership in subsidiary | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100.00% |
Senior unsecured notes | $300,000,000 | $0 | ' | $300,000,000 | ' | ' | ' | ' | ' | ' | ' |
Senior note, stated interst rate | ' | ' | ' | 7.50% | ' | ' | ' | ' | ' | ' | ' |
Debt issuance costs | ' | ' | 7,300,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Period to complete exchange offer | ' | ' | '365 days | ' | ' | ' | ' | ' | ' | ' | ' |
Debt Instrument, Increase (Decrease) in Interest Rate, Stated Percentage | ' | ' | ' | ' | 1.00% | 0.25% | 0.25% | ' | ' | ' | ' |
Exchange offer not declared effective, term 1 | ' | ' | ' | ' | ' | '90 days | ' | ' | ' | ' | ' |
Exchange offer not declared effective, subsequent terms | ' | ' | ' | ' | ' | ' | '90 days | ' | ' | ' | ' |
Limit on redemption as a percentage of principal | ' | ' | ' | ' | ' | ' | ' | 35.00% | ' | ' | ' |
Redemption price as a percentage of principal | ' | ' | ' | ' | ' | ' | ' | 107.50% | 105.63% | 100.00% | ' |
Event of default, period of nonpayment | ' | ' | '30 days | ' | ' | ' | ' | ' | ' | ' | ' |
Event of default, period of noncompliance with SEC filings | ' | ' | '180 days | ' | ' | ' | ' | ' | ' | ' | ' |
Event of default, period of noncompliance with indenture agreements | ' | ' | '30 days | ' | ' | ' | ' | ' | ' | ' | ' |
Event of default, failure to pay judgments (more than) | ' | ' | $20,000,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Event of default, Percentage of debt holders Required to declare all notes due and payable | ' | ' | 25.00% | ' | ' | ' | ' | ' | ' | ' | ' |
PARTNERS_CAPITAL_AND_MEMBERSHI2
PARTNERS' CAPITAL AND MEMBERSHIP INTERESTS (Schedule of Units) (Details) | 9 Months Ended | 9 Months Ended | 9 Months Ended | |||||||||||
Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | |
Bison Midstream | Mountaineer Midstream | Common | Common | Common | Subordinated | Subordinated | Subordinated | Subordinated | General partner | General partner | General partner | General partner | ||
Bison Midstream | Mountaineer Midstream | Bison Midstream | Mountaineer Midstream | Bison Midstream | Mountaineer Midstream | |||||||||
Class of Stock [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common limited partner capital units outstanding, beginning balance | 24,412,427 | ' | ' | 24,412,427 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Subordinated limited partner capital units outstanding, begining balance | 24,409,850 | ' | ' | ' | ' | ' | 24,409,850 | 24,409,850 | ' | ' | ' | ' | ' | ' |
General partner interests units outstanding, beginning balance | 996,320 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,091,453 | 996,320 | ' | ' |
Partner capital units outstanding, beginning balance | 49,818,597 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Units issued in connection with acquisition | ' | 1,585,560 | 3,171,120 | ' | 1,553,849 | 3,107,698 | ' | ' | 0 | 0 | ' | ' | 31,711 | 63,422 |
Common limited partner capital units outstanding, ending balance | 29,073,974 | ' | ' | 29,075,447 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Subordinated limited partner capital units outstanding, ending balance | 24,409,850 | ' | ' | ' | ' | ' | 24,409,850 | 24,409,850 | ' | ' | ' | ' | ' | ' |
General partner interests units outstanding, ending balance | 1,091,453 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,091,453 | 996,320 | ' | ' |
Limited Partners' Capital Account, Units Issued During Period | 1,473 | ' | ' | 1,473 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Partner capital units outstanding, ending balance | 54,576,750 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
PARTNERS_CAPITAL_AND_MEMBERSHI3
PARTNERS' CAPITAL AND MEMBERSHIP INTERESTS (Bison Acquisition) (Details) (USD $) | 0 Months Ended | 3 Months Ended | 9 Months Ended | 0 Months Ended | 1 Months Ended | 0 Months Ended | 1 Months Ended | 9 Months Ended | 0 Months Ended | 9 Months Ended | 0 Months Ended | 9 Months Ended | 0 Months Ended | 9 Months Ended | 1 Months Ended | 0 Months Ended | 9 Months Ended | ||||
In Thousands, except Share data, unless otherwise specified | Jun. 04, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Jun. 04, 2013 | Oct. 03, 2012 | Mar. 31, 2013 | Jun. 04, 2013 | Jun. 03, 2013 | Jun. 30, 2013 | Sep. 30, 2013 | Jun. 04, 2013 | Sep. 30, 2013 | Jun. 04, 2013 | Sep. 30, 2013 | Jun. 04, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Jun. 04, 2013 | Sep. 30, 2013 |
General partner | General partner | General partner | Bison Midstream | Bison Midstream | Bison Midstream | Bison Midstream | Bison Midstream | Bison Midstream | Limited partners, Common | Limited partners, Common | General Partner Units | General Partner Units | Limited Partner Common and General Partner Units | SMP Holdings' equity in Bison Midstream | SMP Holdings' equity in Bison Midstream | ||||||
General partner | General partner | Bison Midstream | Bison Midstream | Bison Midstream | Bison Midstream | Bison Midstream | Bison Midstream | Bison Midstream | |||||||||||||
Business Acquisition [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cumulative percentage ownership after all transactions | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Volume weighted average share price, term | ' | ' | ' | ' | ' | ' | ' | ' | ' | '5 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Volume weighted average share price | ' | ' | ' | ' | ' | ' | ' | ' | ' | $31.53 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cost of acquired entity, cash paid | ' | ' | ' | ' | ' | ' | ' | ' | $200,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $200,000 | ' |
Units issued to acquire entity | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 200,000 | ' | -978 | -47,936 | ' | -978 | ' | -50,000 | 248,914 | 248,914 |
Transaction costs | ' | 123 | 1,739 | 2,549 | 1,972 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Units issued in connection with acquisition | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,585,560 | ' | ' | ' | 1,553,849 | ' | 31,711 | ' | ' | ' |
Net assets in excess of consideration paid | 56,535 | ' | ' | 56,535 | 0 | ' | ' | ' | ' | ' | ' | 0 | 1,131 | 1,131 | ' | ' | ' | ' | ' | ' | -56,535 |
Closing unit price | ' | ' | ' | ' | ' | ' | ' | ' | $30.85 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
SMP Holdings' net investment in Bison Midstream | ' | ' | ' | ' | ' | ' | ' | ' | $305,449 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
General partner interest (as a percent) | ' | ' | ' | ' | ' | 2.00% | 2.00% | 2.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
PARTNERS_CAPITAL_AND_MEMBERSHI4
PARTNERS' CAPITAL AND MEMBERSHIP INTERESTS (Mountaineer Acquisition) (Details) (Mountaineer Midstream, USD $) | 0 Months Ended | 9 Months Ended | ||
Jun. 21, 2013 | Jun. 04, 2013 | Jun. 03, 2013 | Sep. 30, 2013 | |
Business Acquisition [Line Items] | ' | ' | ' | ' |
Cost of acquired entity, purchase price | $210,000,000 | $210,000,000 | ' | ' |
Cost of acquired entity, cash paid | 110,000,000 | 110,000,000 | ' | ' |
Units issued to acquire entity | ' | 100,000,000 | ' | 100,000,000 |
Volume weighted average share price, term | ' | ' | '5 days | ' |
Volume weighted average share price | ' | ' | $31.53 | ' |
Units issued in connection with acquisition | ' | ' | ' | 3,171,120 |
Cost of acquired entity, equity interests issued and issuable | 100,000,000 | 100,000,000 | ' | ' |
Limited partners, Common | ' | ' | ' | ' |
Business Acquisition [Line Items] | ' | ' | ' | ' |
Units issued to acquire entity | ' | 98,000,000 | ' | 98,000,000 |
Units issued in connection with acquisition | ' | ' | ' | 3,107,698 |
General Partner Units | ' | ' | ' | ' |
Business Acquisition [Line Items] | ' | ' | ' | ' |
Units issued to acquire entity | ' | $2,000,000 | ' | ' |
Units issued in connection with acquisition | ' | ' | ' | 63,422 |
PARTNERS_CAPITAL_AND_MEMBERSHI5
PARTNERS' CAPITAL AND MEMBERSHIP INTERESTS (Cash Distributions) (Details) (USD $) | 0 Months Ended | 9 Months Ended | 0 Months Ended | 0 Months Ended | 0 Months Ended | |||||||||||||
In Thousands, except Per Share data, unless otherwise specified | Aug. 14, 2013 | 15-May-13 | Feb. 14, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Oct. 24, 2013 | Aug. 14, 2013 | 15-May-13 | Feb. 14, 2013 | Oct. 24, 2013 | Aug. 14, 2013 | 15-May-13 | Feb. 14, 2013 | Oct. 24, 2013 | Aug. 14, 2013 | 15-May-13 | Feb. 14, 2013 | Oct. 24, 2013 |
Subsequent Event | Limited partners, Common | Limited partners, Common | Limited partners, Common | Limited partners, Common | Subordinated | Subordinated | Subordinated | Subordinated | General Partner Units | General Partner Units | General Partner Units | General Partner Units | ||||||
Subsequent Event | Subsequent Event | Subsequent Event | ||||||||||||||||
Distribution Made to Limited Partner [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Per-unit distribution | $0.00 | $0.00 | $0.00 | ' | ' | $0.00 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Distributions to unitholders | $23,740 | $20,923 | $20,425 | $65,088 | $0 | ' | $12,647 | $10,253 | $10,009 | ' | $10,618 | $10,252 | $10,008 | ' | $475 | $418 | $408 | ' |
Distributions to unitholders, payable | ' | ' | ' | ' | ' | $25,108 | ' | ' | ' | $13,377 | ' | ' | ' | $11,229 | ' | ' | ' | $502 |
PARTNERS_CAPITAL_AND_MEMBERSHI6
PARTNERS' CAPITAL AND MEMBERSHIP INTERESTS (Subordination and Cash Distribution Policy) (Details) (USD $) | 9 Months Ended | 0 Months Ended | 1 Months Ended | 9 Months Ended | |||||
Sep. 30, 2013 | Jun. 04, 2013 | Oct. 03, 2012 | Mar. 31, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | |
General partner | General partner | General partner | Condition one | Condition one | Condition two | Condition two | Subordinated units | ||
General partner | General partner | ||||||||
Schedule of Partners' Capital [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common unit per subordinated unit upon conversion at end of subordination period (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | 1 |
Minimum quarterly distribution (in dollars per share) | ' | ' | ' | ' | $1.60 | ' | $2.40 | ' | ' |
General partner interest (as a percent) | ' | 2.00% | 2.00% | 2.00% | ' | 2.00% | ' | 2.00% | ' |
Term for condition to be met to end subordination period | ' | ' | ' | ' | '3 years | ' | ' | ' | ' |
Percent of minimum distribution | ' | ' | ' | ' | ' | ' | 150.00% | ' | ' |
Maximum period following end of quarter to distribute all available cash | '45 days | ' | ' | ' | ' | ' | ' | ' | ' |
PARTNERS_CAPITAL_AND_MEMBERSHI7
PARTNERS' CAPITAL AND MEMBERSHIP INTERESTS (Minimum Quarterly Distribution) (Details) (USD $) | 9 Months Ended |
Sep. 30, 2013 | |
Equity [Abstract] | ' |
Minimum quarterly distributions (in dollars per share) | $0.40 |
Minimum annual distributions (in dollars per share) | $1.60 |
PARTNERS_CAPITAL_AND_MEMBERSHI8
PARTNERS' CAPITAL AND MEMBERSHIP INTERESTS (Partnership Target Distributions) (Details) (USD $) | 9 Months Ended |
Sep. 30, 2013 | |
Minimum quarterly distribution | ' |
Schedule of Partnership Target Distributions [Line Items] | ' |
Total quarterly distribution per unit target amount | $0.40 |
Thereafter | ' |
Schedule of Partnership Target Distributions [Line Items] | ' |
Total quarterly distribution per unit target amount | $0.60 |
Minimum | First target distribution | ' |
Schedule of Partnership Target Distributions [Line Items] | ' |
Total quarterly distribution per unit target amount | $0.40 |
Minimum | Second target distribution | ' |
Schedule of Partnership Target Distributions [Line Items] | ' |
Total quarterly distribution per unit target amount | $0.46 |
Minimum | Third target distribution | ' |
Schedule of Partnership Target Distributions [Line Items] | ' |
Total quarterly distribution per unit target amount | $0.50 |
Maximum | First target distribution | ' |
Schedule of Partnership Target Distributions [Line Items] | ' |
Total quarterly distribution per unit target amount | $0.46 |
Maximum | Second target distribution | ' |
Schedule of Partnership Target Distributions [Line Items] | ' |
Total quarterly distribution per unit target amount | $0.50 |
Maximum | Third target distribution | ' |
Schedule of Partnership Target Distributions [Line Items] | ' |
Total quarterly distribution per unit target amount | $0.60 |
Unitholders | Minimum quarterly distribution | ' |
Schedule of Partnership Target Distributions [Line Items] | ' |
Percentage interest in distributions | 98.00% |
Unitholders | First target distribution | ' |
Schedule of Partnership Target Distributions [Line Items] | ' |
Percentage interest in distributions | 98.00% |
Unitholders | Second target distribution | ' |
Schedule of Partnership Target Distributions [Line Items] | ' |
Percentage interest in distributions | 85.00% |
Unitholders | Third target distribution | ' |
Schedule of Partnership Target Distributions [Line Items] | ' |
Percentage interest in distributions | 75.00% |
Unitholders | Thereafter | ' |
Schedule of Partnership Target Distributions [Line Items] | ' |
Percentage interest in distributions | 50.00% |
General partner | ' |
Schedule of Partnership Target Distributions [Line Items] | ' |
Percentage interest in distributions | 2.00% |
Quarterly distributions per unit, incentive threshold | $0.46 |
General partner | Minimum quarterly distribution | ' |
Schedule of Partnership Target Distributions [Line Items] | ' |
Percentage interest in distributions | 2.00% |
General partner | First target distribution | ' |
Schedule of Partnership Target Distributions [Line Items] | ' |
Percentage interest in distributions | 2.00% |
General partner | Second target distribution | ' |
Schedule of Partnership Target Distributions [Line Items] | ' |
Percentage interest in distributions | 15.00% |
General partner | Third target distribution | ' |
Schedule of Partnership Target Distributions [Line Items] | ' |
Percentage interest in distributions | 25.00% |
General partner | Thereafter | ' |
Schedule of Partnership Target Distributions [Line Items] | ' |
Percentage interest in distributions | 50.00% |
General partner | Maximum | ' |
Schedule of Partnership Target Distributions [Line Items] | ' |
Percentage interest in distributions in excess of incentive threshold | 50.00% |
EARNINGS_PER_UNIT_Details
EARNINGS PER UNIT (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' | ' |
Net income | $6,691 | $7,396 | $27,291 | $24,112 |
Less: net income attributable to SMP Holdings | 0 | ' | -52 | ' |
Net income attributable to partners | 6,691 | ' | 27,239 | ' |
Less: net income attributable to general partner | -134 | ' | -545 | ' |
Net income attributable to limited partners | 6,557 | ' | 26,694 | ' |
Weighted-average common units outstanding b basic (in units) | 29,074,743 | ' | 26,234,042 | ' |
Earnings per common unit b basic (in dollars per unit) | $0.12 | ' | $0.57 | ' |
Weighted-average common units outstanding b diluted (in units) | 29,227,041 | ' | 26,352,234 | ' |
Earnings per common unit b diluted (in dollars per unit) | $0.12 | ' | $0.57 | ' |
Weighted-average subordinated units outstanding b basic and diluted (in units) | 24,409,850 | ' | 24,409,850 | ' |
Earnings per subordinated unit b basic and diluted (in dollars per unit) | $0.12 | ' | $0.48 | ' |
Phantom and restricted units | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' | ' |
Incremental units attributable to share-based payment arrangements | 152,298 | ' | 118,192 | ' |
Limited partners, Common | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' | ' |
Net income | ' | ' | 13,691 | 0 |
Net income attributable to limited partners | 3,567 | ' | 14,899 | ' |
Subordinated | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' | ' |
Net income | ' | ' | 13,003 | 0 |
Net income attributable to limited partners | $2,990 | ' | $11,795 | ' |
UNITBASED_COMPENSATION_Details
UNIT-BASED COMPENSATION (Details) (USD $) | 3 Months Ended | 7 Months Ended | 9 Months Ended | |||
Sep. 30, 2013 | Sep. 30, 2012 | Apr. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Oct. 31, 2013 | |
holder | ||||||
Other disclosures | ' | ' | ' | ' | ' | ' |
Payment to acquire vested net profit interests | ' | ' | ' | $11,957,000 | $0 | ' |
Long-term Incentive Plan | ' | ' | ' | ' | ' | ' |
Weighted-average grant date fair value | ' | ' | ' | ' | ' | ' |
Non-cash compensation expense (in dollars) | 829,000 | ' | ' | ' | ' | ' |
Other disclosures | ' | ' | ' | ' | ' | ' |
Unit-based compensation | ' | ' | ' | 1,970,000 | ' | ' |
Common Units | Long-term Incentive Plan | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' | ' | ' |
Units reserved for issuance pursuant to LTIP | 5,000,000 | ' | ' | 5,000,000 | ' | ' |
Units available for future issuance | 4,700,000 | ' | ' | 4,700,000 | ' | ' |
Phantom Units | ' | ' | ' | ' | ' | ' |
Phantom and Restricted Unit Activity | ' | ' | ' | ' | ' | ' |
Nonvested phantom and restricted units, beginning of period (in shares) | ' | ' | ' | 131,558 | ' | ' |
Units granted (in shares) | ' | ' | ' | 155,330 | ' | ' |
Units forfeited (in shares) | ' | ' | ' | -4,041 | ' | ' |
Nonvested phantom and restricted units, end of period (in shares) | 283,682 | ' | ' | 283,682 | ' | ' |
Weighted-average grant date fair value | ' | ' | ' | ' | ' | ' |
Nonvested, Weighted-average grant date fair value, beginning | ' | ' | ' | $20 | ' | ' |
Units granted, Weighted-average grant date fair value | ' | ' | ' | $26.33 | ' | ' |
Units forfeited, Weighted-average grant date fair value | ' | ' | ' | $25.99 | ' | ' |
Nonvested, Weighted-average grant date fair value, ending | $23.41 | ' | ' | $23.41 | ' | ' |
Award vesting period | ' | ' | ' | '3 years | ' | ' |
Phantom Units | Granted in March 2013 | ' | ' | ' | ' | ' | ' |
Weighted-average grant date fair value | ' | ' | ' | ' | ' | ' |
Unrecognized non-cash compensation expense | 4,400,000 | ' | ' | 4,400,000 | ' | ' |
Remaining expected weighted-average vesting period of recognition of incremental non-cash compensation expense | ' | ' | ' | '2 years 11 months 0 days | ' | ' |
Phantom Units | Granted in October 2012 | ' | ' | ' | ' | ' | ' |
Phantom and Restricted Unit Activity | ' | ' | ' | ' | ' | ' |
Units forfeited (in shares) | ' | ' | ' | 0 | ' | ' |
Restricted Units | ' | ' | ' | ' | ' | ' |
Phantom and Restricted Unit Activity | ' | ' | ' | ' | ' | ' |
Units granted (in shares) | ' | ' | ' | 835 | ' | ' |
Weighted-average grant date fair value | ' | ' | ' | ' | ' | ' |
Units granted, Weighted-average grant date fair value | ' | ' | ' | $27.50 | ' | ' |
DFW Net Profits Interests | ' | ' | ' | ' | ' | ' |
Phantom and Restricted Unit Activity | ' | ' | ' | ' | ' | ' |
Nonvested phantom and restricted units, beginning of period (in shares) | ' | ' | ' | ' | ' | 0 |
Nonvested phantom and restricted units, end of period (in shares) | ' | ' | ' | ' | ' | 0 |
Weighted-average grant date fair value | ' | ' | ' | ' | ' | ' |
Non-cash compensation expense (in dollars) | 0 | 75,000 | ' | 17,000 | 874,000 | ' |
Other disclosures | ' | ' | ' | ' | ' | ' |
Number of holders of net profit interest | ' | ' | 7 | ' | ' | ' |
Payment to acquire vested net profit interests | ' | ' | $12,200,000 | ' | ' | ' |
SMLP Restricted Units | ' | ' | ' | ' | ' | ' |
Other disclosures | ' | ' | ' | ' | ' | ' |
Restricted units exchanged for unvested net profit interests | ' | ' | 7,393 | ' | ' | ' |
CONCENTRATIONS_OF_RISK_Details
CONCENTRATIONS OF RISK (Details) | 3 Months Ended | 9 Months Ended | 12 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2012 | |
Counterparty A | Counterparty A | Counterparty A | Counterparty A | Counterparty A | Counterparty A | Counterparty B | Counterparty B | Counterparty B | Counterparty B | Counterparty B | Counterparty B | Counterparty C | Counterparty C | Counterparty D | Counterparty D | Counterparty E [Member] | Counterparty E [Member] | |
Revenue | Revenue | Revenue | Revenue | Accounts receivable | Accounts receivable | Revenue | Revenue | Revenue | Revenue | Accounts receivable | Accounts receivable | Revenue | Revenue | Revenue | Revenue | Revenue | Revenue | |
Customer concentration | Customer concentration | Customer concentration | Customer concentration | Credit concentration | Credit concentration | Customer concentration | Customer concentration | Customer concentration | Customer concentration | Credit concentration | Credit concentration | Customer concentration | Customer concentration | Customer concentration | Customer concentration | Customer concentration | Customer concentration | |
CONCENTRATIONS OF RISK | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total revenues, major customer percentage | 17.00% | 29.00% | 19.00% | 19.00% | 23.00% | 24.00% | 16.00% | 29.00% | 18.00% | 27.00% | 21.00% | 38.00% | 10.00% | 9.00% | 10.00% | 9.00% | 13.00% | 14.00% |
RELATEDPARTY_TRANSACTIONS_Deta
RELATED-PARTY TRANSACTIONS (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Mar. 31, 2012 | Sep. 30, 2013 |
In Thousands, unless otherwise specified | General partner | General partner | General partner | Equipower | Equipower | Equipower | Equipower | ||
RELATED-PARTY TRANSACTIONS | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Due to affiliate | $430 | $0 | $430 | $430 | $0 | ' | ' | ' | ' |
Due from affiliate | 0 | 774 | 0 | 0 | 774 | ' | ' | ' | ' |
General and administrative expense allocation | ' | ' | 794 | 2,600 | ' | ' | ' | ' | ' |
Payments for electricity management consulting services | ' | ' | ' | ' | ' | $54 | $56 | $144 | $163 |
COMMITMENTS_AND_CONTINGENCIES_1
COMMITMENTS AND CONTINGENCIES (Details) (USD $) | 3 Months Ended | 9 Months Ended | 1 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Aug. 31, 2012 |
Former DFW Midstream Employee Claim | |||||
employee | |||||
Commitments and contingencies | ' | ' | ' | ' | ' |
Total rent expense related to operating leases | $312 | $189 | $819 | $504 | ' |
Number of plaintiffs | ' | ' | ' | ' | 4 |
ACQUISITIONS_Bison_Midstream_D
ACQUISITIONS (Bison Midstream) (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Jun. 04, 2013 | Sep. 30, 2013 | Jun. 04, 2013 | Jun. 04, 2013 | Jun. 04, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Jun. 30, 2013 |
Gas Gathering Contract | Gas Gathering Contract | Bison Midstream | Bison Midstream | Bison Midstream | Bison Midstream | Bison Midstream | Bison Midstream | Bison Midstream | Bison Midstream | |||
Minimum | Maximum | Limited partners, Common | General Partner Units | SMP Holdings' equity in Bison Midstream | SMP Holdings' equity in Bison Midstream | Gas Gathering Contract | Gas Gathering Contract | |||||
Minimum | Maximum | |||||||||||
Business Acquisition [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cost of acquired entity, purchase price | ' | ' | ' | ' | $248,900,000 | ' | ' | ' | $248,900,000 | ' | ' | ' |
Useful lives | ' | ' | '10 years | '25 years | ' | ' | ' | ' | ' | ' | '5 years | '15 years |
Purchase price assigned to Bison Gas Gathering system | ' | ' | ' | ' | 303,168,000 | ' | ' | ' | ' | ' | ' | ' |
Current assets | ' | ' | ' | ' | 5,705,000 | ' | ' | ' | ' | ' | ' | ' |
Property, plant, and equipment | ' | ' | ' | ' | 85,477,000 | ' | ' | ' | ' | ' | ' | ' |
Intangible assets | ' | ' | ' | ' | 164,502,000 | ' | ' | ' | ' | ' | ' | ' |
Other noncurrent assets | ' | ' | ' | ' | 2,187,000 | ' | ' | ' | ' | ' | ' | ' |
Total assets acquired | ' | ' | ' | ' | 257,871,000 | ' | ' | ' | ' | ' | ' | ' |
Current liabilities | ' | ' | ' | ' | 6,112,000 | ' | ' | ' | ' | ' | ' | ' |
Other noncurrent liabilities | ' | ' | ' | ' | 2,790,000 | ' | ' | ' | ' | ' | ' | ' |
Total liabilities assumed | ' | ' | ' | ' | 8,902,000 | ' | ' | ' | ' | ' | ' | ' |
Net identifiable assets acquired | ' | ' | ' | ' | 248,969,000 | ' | ' | ' | ' | ' | ' | ' |
Goodwill | 117,766,000 | 45,478,000 | ' | ' | 54,199,000 | 54,200,000 | ' | ' | ' | ' | ' | ' |
Cost of acquired entity, cash paid | ' | ' | ' | ' | 200,000,000 | ' | ' | ' | 200,000,000 | ' | ' | ' |
Cost of acquired entity, equity interests issued and issuable | ' | ' | ' | ' | ' | ' | 47,900,000 | 1,000,000 | ' | ' | ' | ' |
Units issued to acquire entity | ' | ' | ' | ' | ' | 200,000,000 | -47,936,000 | -978,000 | 248,914,000 | 248,914,000 | ' | ' |
Purchase price assigned to Bison Gas Gathering system | ' | ' | ' | ' | ' | $303,168,000 | ' | ' | $303,200,000 | $303,168,000 | ' | ' |
ACQUISITIONS_Revenue_and_Net_I
ACQUISITIONS (Revenue and Net Income) (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Business Acquisition [Line Items] | ' | ' | ' | ' |
Revenues | $63,096 | $40,975 | $173,508 | $116,865 |
Net income | 6,691 | 7,396 | 27,291 | 24,112 |
Summit Midstream Partners, LP | ' | ' | ' | ' |
Business Acquisition [Line Items] | ' | ' | ' | ' |
Revenues | ' | ' | 155,894 | ' |
Net income | ' | ' | 27,239 | ' |
Bison Midstream, LLC | ' | ' | ' | ' |
Business Acquisition [Line Items] | ' | ' | ' | ' |
Revenues | ' | ' | 17,614 | ' |
Net income | ' | ' | $52 | ' |
ACQUISITIONS_Mountaineer_Midst
ACQUISITIONS (Mountaineer Midstream) (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 | Jun. 21, 2013 | Jun. 04, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Jun. 30, 2013 | Jun. 30, 2013 |
Mountaineer Midstream | Mountaineer Midstream | Mountaineer Midstream | Mountaineer Midstream | Mountaineer Midstream | Mountaineer Midstream | Mountaineer Midstream | |||
compressor_station | Contract intangibles | Rights-of-way | |||||||
Business Acquisition [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cost of acquired entity, purchase price | ' | ' | $210,000,000 | $210,000,000 | ' | ' | ' | ' | ' |
Number of compressor stations acquired | ' | ' | 2 | ' | ' | ' | ' | ' | ' |
Cost of acquired entity, cash paid | ' | ' | 110,000,000 | 110,000,000 | ' | ' | ' | ' | ' |
Cost of acquired entity, equity interests issued and issuable | ' | ' | 100,000,000 | 100,000,000 | ' | ' | ' | ' | ' |
Mountaineer Midstream revenues since acquisition | ' | ' | ' | ' | 4,300,000 | 4,700,000 | ' | ' | ' |
Mountaineer Midstream net income since acquisition | ' | ' | ' | ' | 1,300,000 | 1,600,000 | ' | ' | ' |
Purchase price assigned, property, plant, and equipment | ' | ' | ' | ' | ' | ' | 158,300,000 | ' | ' |
Purchase price assigned, intagibles assets | ' | ' | ' | ' | ' | ' | ' | 27,100,000 | 6,500,000 |
Goodwill | $117,766,000 | $45,478,000 | ' | ' | ' | ' | $18,100,000 | ' | ' |
ACQUISITIONS_Pro_Forma_Details
ACQUISITIONS (Pro Forma) (Details) (USD $) | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ' | ' | ' |
Pro forma total revenues | $50,731,000 | $185,659,000 | $141,372,000 |
Pro forma net income | 6,014,000 | 24,316,000 | 16,549,000 |
Limited partners, Common | ' | ' | ' |
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ' | ' | ' |
Pro forma EPU, basic and diluted | ' | $0.44 | ' |
Subordinated units | ' | ' | ' |
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ' | ' | ' |
Pro forma EPU, basic and diluted | ' | $0.44 | ' |
Acquisition-related Costs | ' | ' | ' |
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ' | ' | ' |
Pro forma effect of nonrecurring transaction costs incurred on net income | ' | 2,500,000 | ' |
Bison Midstream and Mountaineer Midstream | ' | ' | ' |
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ' | ' | ' |
Incremental borrowings on revolving credit facility | ' | 310,000,000 | ' |
Pro forma total revenues | 0 | 44,176,000 | 0 |
Pro forma net income | $0 | $911,000 | $0 |