Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2019 | May 02, 2019 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2019 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | SHLX | |
Entity Registrant Name | Shell Midstream Partners, L.P. | |
Entity Central Index Key | 0001610466 | |
Current Fiscal Year End Date | --12-31 | |
Entity Emerging Growth Company | false | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Common Stock, Shares Outstanding | 223,811,781 |
UNAUDITED CONDENSED CONSOLIDATE
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Mar. 31, 2019 | Dec. 31, 2018 |
Current assets | ||
Cash and cash equivalents | $ 226 | $ 208 |
Accounts receivable – third parties, net | 14 | 19 |
Accounts receivable – related parties | 29 | 29 |
Allowance oil | 11 | 13 |
Prepaid expenses | 11 | 15 |
Total current assets | 291 | 284 |
Equity method investments | 814 | 823 |
Property, plant and equipment, net | 740 | 742 |
Operating lease right-of-use assets | 5 | 0 |
Other investments | 62 | 62 |
Other assets – related parties | 3 | 3 |
Total assets | 1,915 | 1,914 |
Current liabilities | ||
Accounts payable – third parties | 7 | 4 |
Accounts payable – related parties | 9 | 9 |
Deferred revenue – third parties | 1 | 8 |
Deferred revenue – related party | 1 | 3 |
Accrued liabilities – third parties | 12 | 13 |
Accrued liabilities – related parties | 15 | 16 |
Total current liabilities | 45 | 53 |
Noncurrent liabilities | ||
Debt payable – related party | 2,091 | 2,091 |
Operating lease liabilities | 5 | 0 |
Finance lease liabilities | 25 | 25 |
Other unearned income | 3 | 2 |
Total noncurrent liabilities | 2,124 | 2,118 |
Total liabilities | 2,169 | 2,171 |
Commitments and Contingencies (Note 12) | ||
(DEFICIT) EQUITY | ||
Total partners’ deficit | (281) | (282) |
Noncontrolling interests | 27 | 25 |
Total deficit | (254) | (257) |
Total liabilities and deficit | 1,915 | 1,914 |
Shell Pipeline Company L P | ||
(DEFICIT) EQUITY | ||
General partner – SPLC (4,567,588 units issued and outstanding as of both March 31, 2019 and December 31, 2018) | (3,549) | (3,543) |
Common Units | General Public | ||
(DEFICIT) EQUITY | ||
Common unitholders | 3,464 | 3,459 |
Common Units | Shell Pipeline Company L P | ||
(DEFICIT) EQUITY | ||
Common unitholders | $ (196) | $ (198) |
UNAUDITED CONDENSED CONSOLIDA_2
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - shares | Mar. 31, 2019 | Dec. 31, 2018 |
Common unitholders' capital account, units outstanding (in shares) | 223,811,781 | |
Shell Pipeline Company L P | ||
General partners' capital account, units issued (in shares) | 4,567,588 | 4,567,588 |
General partners' capital account, units outstanding (in shares) | 4,567,588 | 4,567,588 |
Common Units | General Public | ||
Common unitholders' capital account, units issued (in shares) | 123,832,233 | 123,832,233 |
Common unitholders' capital account, units outstanding (in shares) | 123,832,233 | 123,832,233 |
Common Units | Shell Pipeline Company L P | ||
Common unitholders' capital account, units issued (in shares) | 99,979,548 | 99,979,548 |
Common unitholders' capital account, units outstanding (in shares) | 99,979,548 | 99,979,548 |
UNAUDITED CONDENSED CONSOLIDA_3
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Revenue | ||
Revenue from contract with customer | $ 117 | $ 86 |
Lease revenue – related parties | 14 | 14 |
Total revenue | 131 | 100 |
Costs and expenses | ||
Operations and maintenance – third parties | 13 | 43 |
Operations and maintenance – related parties | 14 | 13 |
Cost of product sold – third parties | 1 | 0 |
Cost of product sold – related parties | 8 | 7 |
Loss from revision of asset retirement obligation | 2 | 0 |
General and administrative – third parties | 1 | 2 |
General and administrative – related parties | 11 | 13 |
Depreciation, amortization and accretion | 12 | 11 |
Property and other taxes | 4 | 6 |
Total costs and expenses | 66 | 95 |
Operating income | 65 | 5 |
Income from equity method investments | 70 | 40 |
Dividend income from cost investments | 14 | 25 |
Other income | 8 | 6 |
Investment, dividend and other income | 92 | 71 |
Interest expense, net | 20 | 11 |
Income before income taxes | 137 | 65 |
Income tax expense | 0 | 0 |
Net income | 137 | 65 |
Less: Net income attributable to noncontrolling interests | 5 | 1 |
Net income attributable to the Partnership | 132 | 64 |
Limited Partners' interest in net income attributable to the Partnership | $ 105 | $ 37 |
Net income per Limited Partner Unit - Basic and Diluted | ||
Distributions per Limited Partner unit (in dollars per share) | $ 0.415 | $ 0.348 |
Shell Pipeline Company L P | ||
Costs and expenses | ||
General partner's interest in net income attributable to the Partnership | $ 27 | $ 27 |
Common | ||
Costs and expenses | ||
Net income attributable to the Partnership | $ 105 | $ 37 |
Net income per Limited Partner Unit - Basic and Diluted | ||
Net income per Limited Partner unit (in dollars per share) | $ 0.47 | $ 0.18 |
Common units – public | ||
Costs and expenses | ||
Net income | $ 58 | $ 21 |
Weighted average Limited Partner Units outstanding - Basic and Diluted (in millions) | ||
Weighted average Limited Partner units outstanding - Common (in shares) | 123.8 | 113.8 |
Common units – public | Shell Pipeline Company L P | ||
Costs and expenses | ||
Net income | $ 47 | $ 16 |
Common units – SPLC | Shell Pipeline Company L P | ||
Weighted average Limited Partner Units outstanding - Basic and Diluted (in millions) | ||
Weighted average Limited Partner units outstanding - Common (in shares) | 100 | 95.6 |
Third Parties | Transportation, Terminaling and Storage Services | ||
Revenue | ||
Revenue from contract with customer | $ 42 | $ 35 |
Third Parties | Product Revenue | ||
Revenue | ||
Revenue from contract with customer | 1 | 0 |
Related Parties | Transportation, Terminaling and Storage Services | ||
Revenue | ||
Revenue from contract with customer | 64 | 43 |
Related Parties | Product Revenue | ||
Revenue | ||
Revenue from contract with customer | 10 | 8 |
Noncontrolling Interests | ||
Costs and expenses | ||
Net income | $ 5 | $ 1 |
UNAUDITED CONDENSED CONSOLIDA_4
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Cash flows from operating activities | ||
Net income | $ 137 | $ 65 |
Adjustments to reconcile net income to net cash provided by operating activities | ||
Depreciation, amortization and accretion | 12 | 11 |
Loss from revision of asset retirement obligation | 2 | 0 |
Undistributed equity earnings | (3) | (1) |
Changes in operating assets and liabilities | ||
Accounts receivable | 5 | 13 |
Allowance oil | 2 | 0 |
Prepaid expenses and other assets | 4 | 3 |
Accounts payable | (1) | 5 |
Deferred revenue and other unearned income | (8) | (2) |
Accrued liabilities | 0 | 15 |
Net cash provided by operating activities | 150 | 109 |
Cash flows from investing activities | ||
Capital expenditures | (10) | (9) |
Contributions to investment | (5) | 0 |
Return of investment | 8 | 11 |
Net cash (used in) provided by investing activities | (7) | 2 |
Cash flows from financing activities | ||
Net proceeds from equity offerings | 0 | 973 |
Repayments of credit facilities | 0 | (973) |
Contributions from general partner | 0 | 20 |
Distributions to noncontrolling interests | (3) | (2) |
Distributions to unitholders and general partner | (129) | (83) |
Other contributions from Parent | 7 | 1 |
Net cash used in financing activities | (125) | (64) |
Net increase in cash and cash equivalents | 18 | 47 |
Cash and cash equivalents at beginning of the period | 208 | 138 |
Cash and cash equivalents at end of the period | 226 | 185 |
Non-cash investing and financing transactions: | ||
Change in accrued capital expenditures | 2 | 5 |
Other contributions from Parent | $ 0 | $ 4 |
UNAUDITED CONDENSED CONSOLIDA_5
UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN (DEFICIT) EQUITY - USD ($) $ in Millions | Total | Noncontrolling Interests | Common Unitholders | Common UnitholdersShell Pipeline Company L P | General PartnerShell Pipeline Company L P |
Beginning balance at Dec. 31, 2017 | $ (566) | $ 23 | $ 2,774 | $ (507) | $ (2,856) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 65 | 1 | 21 | 16 | 27 |
Net proceeds from equity offerings | 973 | 673 | 300 | ||
Contributions from general partner | 20 | 20 | |||
Other contributions from Parent | 5 | 5 | |||
Distributions to unitholders and general partner | (83) | (33) | (30) | (20) | |
Distributions to noncontrolling interests | (2) | (2) | |||
Ending balance at Mar. 31, 2018 | 410 | 22 | 3,434 | (220) | (2,826) |
Beginning balance at Dec. 31, 2018 | (257) | 25 | 3,459 | (198) | (3,543) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 137 | 5 | 58 | 47 | 27 |
Other contributions from Parent | 7 | 7 | |||
Distributions to unitholders and general partner | (129) | (49) | (40) | (40) | |
Distributions to noncontrolling interests | (3) | (3) | |||
Ending balance at Mar. 31, 2019 | $ (254) | $ 27 | $ 3,464 | $ (196) | $ (3,549) |
Description of Business and Bas
Description of Business and Basis of Presentation | 3 Months Ended |
Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business and Basis of Presentation | Except as noted within the context of each note disclosure, the dollar amounts presented in the tabular data within these note disclosures are stated in millions of dollars. 1. Description of Business and Basis of Presentation Shell Midstream Partners, L.P. (“we,” “us,” “our” or “the Partnership”) is a Delaware limited partnership formed by Royal Dutch Shell plc on March 19, 2014 to own and operate pipeline and other midstream assets, including certain assets acquired from Shell Pipeline Company LP (“SPLC”) and its affiliates. We conduct our operations either through our wholly owned subsidiary Shell Midstream Operating, LLC (“Operating Company”) or through direct ownership. Our general partner is Shell Midstream Partners GP LLC (“general partner” or “sponsor”). References to “RDS”, “Shell” or “Parent” refer collectively to Royal Dutch Shell plc and its controlled affiliates, other than us, our subsidiaries and our general partner. Our common units trade on the New York Stock Exchange under the symbol “SHLX”. Description of Business We are a growth-oriented master limited partnership that owns, operates, develops and acquires pipelines and other midstream assets. As of March 31, 2019, our assets include interests in entities that own crude oil and refined products pipelines and terminals that serve as key infrastructure to (i) transport onshore and offshore crude oil production to Gulf Coast and Midwest refining markets and (ii) deliver refined products from those markets to major demand centers. Our assets also include interests in entities that own natural gas and refinery gas pipelines that transport offshore natural gas to market hubs and deliver refinery gas from refineries and plants to chemical sites along the Gulf Coast. We generate revenue from the transportation, terminaling and storage of crude oil and refined products through our pipelines and storage tanks, and generate income from our equity and other investments. Our operations consist of one reportable segment. The following table reflects our ownership, and Shell’s retained ownership as of March 31, 2019: SHLX Ownership Shell’s Retained Ownership Pecten Midstream LLC (“Pecten”) 100.0 % — % Sand Dollar Pipeline LLC (“Sand Dollar”) 100.0 % — % Triton West LLC (“Triton”) 100.0 % — % Zydeco Pipeline Company LLC (“Zydeco”) 92.5 % 7.5 % Amberjack Pipeline Company LLC (“Amberjack”) – Series A/Series B 75.0% / 50.0% — % Mars Oil Pipeline Company LLC (“Mars”) 71.5 % — % Odyssey Pipeline L.L.C. (“Odyssey”) 71.0 % — % Bengal Pipeline Company LLC (“Bengal”) 50.0 % — % Crestwood Permian Basin LLC (“Permian Basin”) 50.0 % — % LOCAP LLC (“LOCAP”) 41.48 % — % Poseidon Oil Pipeline Company, L.L.C. (“Poseidon”) 36.0 % — % Explorer Pipeline Company (“Explorer”) 12.62 % 25.97 % Proteus Oil Pipeline Company, LLC (“Proteus”) 10.0 % — % Endymion Oil Pipeline Company, LLC (“Endymion”) 10.0 % — % Colonial Pipeline Company (“Colonial”) 6.0 % 10.12 % Cleopatra Gas Gathering Company, LLC (“Cleopatra”) 1.0 % — % Basis of Presentation Our unaudited consolidated financial statements include all subsidiaries required to be consolidated under generally accepted accounting principles in the United States (“GAAP”). Our reporting currency is U.S. dollars, and all references to dollars are U.S. dollars. The accompanying unaudited consolidated financial statements and related notes have been prepared in accordance with GAAP for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and notes required by GAAP for complete annual financial statements. The year-end consolidated balance sheet data was derived from audited financial statements. During interim periods, we follow the accounting policies disclosed in our Annual Report on Form 10-K for the year ended December 31, 2018 (our “2018 Annual Report”), filed with the United States Securities and Exchange Commission (“SEC”). The unaudited consolidated financial statements for the three months ended March 31, 2019 and March 31, 2018 include all adjustments we believe are necessary for a fair statement of the results of operations for the interim periods presented. These adjustments are of a normal recurring nature unless otherwise disclosed. Operating results for the interim periods are not necessarily indicative of the results that may be expected for the full year. These unaudited consolidated financial statements and other information included in this Quarterly Report on Form 10-Q should be read in conjunction with our audited consolidated financial statements and notes thereto included in our 2018 Annual Report. Our consolidated subsidiaries include Pecten, Sand Dollar, Triton, Zydeco, Odyssey and the Operating Company. Asset acquisitions of additional interests in previously consolidated subsidiaries and interests in equity and other investments are included in the financial statements prospectively from the effective date of each acquisition. In cases where these types of acquisitions are considered acquisitions of businesses under common control, the financial statements are retrospectively adjusted. Summary of Significant Accounting Policies The accounting policies are set forth in Note 2 — Summary of Significant Accounting Policies in the Notes to Consolidated Financial Statements of our 2018 Annual Report. There have been no significant changes to these policies during the three months ended March 31, 2019, other than those noted below. Recent Accounting Pronouncements Standards Adopted as of January 1, 2019 In February 2016, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) 2016-02 to Topic 842, Leases. As permitted, we adopted the new standard using the modified retrospective approach, effective January 1, 2019, which provides a method for recording existing leases at the beginning of the period of adoption. As such, results and balances prior to January 1, 2019 are not adjusted and continue to be reported in accordance with our historical accounting under previous GAAP. See Note 7 — Leases for additional information and disclosures required by the new standard. Standards Not Yet Adopted In June 2016, the FASB issued ASU 2016-13 to Topic 326, Financial Instruments — Credit Losses: Measurement of Credit Losses on Financial Instruments, which replaces the current incurred loss impairment method with a method that reflects expected credit losses on financial instruments. The update is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early adoption is permitted for fiscal years beginning after December 15, 2018. While we are still evaluating the impact of ASU 2016-13, we do not expect the adoption of this standard to have a material impact on our consolidated financial statements. |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2019 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party TransactionsRelated party transactions include transactions with SPLC and Shell, including those entities in which Shell has an ownership interest but does not have control. Acquisition Agreements For a description of applicable agreements, see Note 4—Acquisitions and Divestiture in the Notes to Consolidated Financial Statements of our 2018 Annual Report. 2019 Omnibus Agreement On November 3, 2014, we entered into an Omnibus Agreement with SPLC and our general partner concerning our payment of an annual general and administrative services fee to SPLC as well as our reimbursement of certain costs incurred by SPLC on our behalf. On February 19, 2019, we, our general partner, SPLC, Operating Company and Shell Oil Company terminated the Omnibus Agreement effective as of February 1, 2019, and we, our general partner, SPLC and Operating Company entered into a new Omnibus Agreement effective February 1, 2019 (the “2019 Omnibus Agreement”). The 2019 Omnibus Agreement addresses, among other things, the following matters: • our payment of an annual general and administrative fee of approximately $11 million for the provision of certain services by SPLC; • our obligation to reimburse SPLC for certain direct or allocated costs and expenses incurred by SPLC on our behalf; and • our obligation to reimburse SPLC for all expenses incurred by SPLC as a result of us becoming and continuing as a publicly traded entity; we will reimburse our general partner for these expenses to the extent the fees relating to such services are not included in the general and administrative fee . Under the 2019 Omnibus Agreement, SPLC agreed to indemnify us against tax liabilities relating to our assets acquired at initial public offering (our “initial assets”) that are identified prior to the date that is 60 days after the expiration of the statute of limitations applicable to such liabilities. This obligation has no threshold or cap. We in turn agreed to indemnify SPLC against events and conditions associated with the ownership or operation of our initial assets (other than any liabilities against which SPLC is specifically required to indemnify us as described above). During the three months ended March 31, 2019, neither we nor SPLC made any claims for indemnification under the 2019 Omnibus Agreement. Trade Marks License Agreement We, our general partner and SPLC entered into a Trade Marks License Agreement with Shell Trademark Management Inc. effective as of February 1, 2019. The Trade Marks License Agreement grants us the use of certain Shell trademarks and trade names and expires on January 1, 2024 unless earlier terminated by either party upon 360 days’ notice. Tax Sharing Agreement For a discussion of the Tax Sharing Agreement, see Note 5—Related Party Transactions—Tax Sharing Agreement in the Notes to Consolidated Financial Statements of our 2018 Annual Report. Other Agreements We have entered into several customary agreements with SPLC and Shell. These agreements include pipeline operating agreements, reimbursement agreements and services agreements. See Note 5—Related Party Transactions—Other Agreements in the Notes to Consolidated Financial Statements of our 2018 Annual Report. Partnership Agreement On December 21, 2018, we executed Amendment No. 2 (the “Second Amendment”) to the Partnership’s First Amended and Restated Agreement of Limited Partnership dated November 3, 2014. Under the Second Amendment, our sponsor agreed to waive $50 million of distributions in 2019 by agreeing to reduce distributions to holders of the incentive distribution rights (“IDR’s”) by: (1) $17 million for the three months ended March 31, 2019, (2) $17 million for the three months ending June 30, 2019 and (3) $16 million for the three months ending September 30, 2019. Noncontrolling Interests For Zydeco, noncontrolling interest consists of SPLC’s 7.5% retained ownership interest as of both March 31, 2019 and December 31, 2018. For Odyssey, noncontrolling interest consists of GEL Offshore Pipeline LLC’s (“GEL”) 29.0% retained ownership interest as of both March 31, 2019 and December 31, 2018. Other Related Party Balances Other related party balances consist of the following: March 31, 2019 December 31, 2018 Accounts receivable $ 29 $ 29 Prepaid expenses 11 15 Other assets 3 3 Accounts payable (1) 9 9 Deferred revenue 1 3 Accrued liabilities (2) 15 16 Debt payable (3) 2,091 2,091 (1) Accounts payable reflects amounts owed to SPLC for reimbursement of third-party expenses incurred by SPLC for our benefit. (2) As of March 31, 2019, accrued liabilities reflects $14 million accrued interest and $1 million other accrued liabilities. As of December 31, 2018, accrued liabilities reflects $14 million accrued interest and $2 million other accrued liabilities. (3) Debt payable reflects borrowings outstanding after taking into account unamortized debt issuance costs of $3 million as of both March 31, 2019 and December 31, 2018. Related Party Credit Facilities We have entered into four credit facilities with Shell Treasury Center (West) Inc. (“STCW”): the Seven Year Fixed Facility, the Five Five Five Note 9—Related Party Debt in the Notes to Consolidated Financial Statements of our 2018 Annual Report. Related Party Revenues and Expenses We provide crude oil transportation, terminaling and storage services to related parties under long-term contracts. We entered into these contracts in the normal course of our business. Our revenue from related parties for the three months ended March 31, 2019 and March 31, 2018 are disclosed in Note 9 – Revenue Recognition . In the three months ended March 31, 2019 and March 31, 2018, we converted excess allowance oil to cash through sales to affiliates of Shell of $2 million and $1 million net proceeds, respectively. We include the revenue in Product revenue – related parties and the cost in Cost of product sold – related parties. The majority of our insurance coverage is provided by a wholly owned subsidiary of Shell with the remaining coverage provided by third-party insurers. The related party portion of insurance expense, which is included within Operations and maintenance – related parties, was $4 million for both the three months ended March 31, 2019 and March 31, 2018. The following table shows related party expenses, including certain personnel costs, incurred by Shell and SPLC on our behalf that are reflected in the accompanying unaudited consolidated statements of income for the indicated periods. Included in these amounts, and disclosed below, is our share of operating and general corporate expenses, as well as the fees paid to SPLC under certain agreements. Three Months Ended March 31, 2019 2018 Operations and maintenance – related parties $ 14 $ 13 General and administrative – related parties 11 13 Allocated operating expenses $ 5 $ 4 Allocated general corporate expenses 7 8 Management Agreement fee 2 2 Omnibus Agreement fee 3 2 For a discussion of services performed by Shell on our behalf, see Note 1 – Description of Business and Basis of Presentation – Basis of Presentation in the Notes to Consolidated Financial Statements of our 2018 Annual Report. Pension and Retirement Savings Plans Employees who directly or indirectly support our operations participate in the pension, postretirement health and life insurance, and defined contribution benefit plans sponsored by Shell, which include other Shell subsidiaries. Our share of pension and postretirement health and life insurance costs for both the three months ended March 31, 2019 and March 31, 2018 were $2 million. Our share of defined contribution benefit plan costs for both the three months ended March 31, 2019 and March 31, 2018 were $1 million. Pension and defined contribution benefit plan expenses are included in either General and administrative – related parties or Operations and maintenance – related parties, depending on the nature of the employee’s role in our operations. Share-based Compensation Certain SPLC and Shell employees supporting our operations as well as other Shell operations were historically granted awards under the Performance Share Plan (“PSP”), Shell’s incentive compensation program. Share-based compensation expense is included in General and administrative – related parties in the accompanying unaudited consolidated statements of income. These costs for the three months ended March 31, 2019 and March 31, 2018 were not material. Equity and Other Investments We have equity and other investments in entities, including Colonial and Explorer, in which SPLC also owns interests. In some cases, we may be required to make capital contributions or other payments to these entities. See Note 3 – Equity Method Investments for additional details. Reimbursements The following table reflects reimbursements from our Parent for the three months ended March 31, 2019 and March 31, 2018: Three Months Ended March 31, 2019 2018 Cash received (1) $ 7 $ 1 Changes in receivable from Parent ( 2 ) — 3 Total reimbursements ( 3 ) $ 7 $ 4 (1) These reimbursements are included in Other contributions from Parent in the accompanying unaudited consolidated statements of cash flows. ( 2 ) These reimbursements are included in Other non-cash contributions from Parent in the accompanying unaudited consolidated statements of cash flows. ( 3 ) These reimbursements are included in Other contributions from Parent in the accompanying unaudited consolidated statements of (deficit) equity and are exclusive of zero and $1 million for the three months ended March 31, 2019 and March 31, 2018, respectively, related to contributions from Parent. During the three months ended March 31, 2019 and March 31, 2018, we filed claims for reimbursement from our Parent of $7 million and $4 million, respectively. This reflects our proportionate share of Zydeco directional drill project costs and expenses. |
Equity Method Investments
Equity Method Investments | 3 Months Ended |
Mar. 31, 2019 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity Method Investments | Equity Method Investments For each of the following investments, we have the ability to exercise significant influence over these investments based on certain governance provisions and our participation in the significant activities and decisions that impact the management and economic performance of the investments. Equity method investments comprise the following as of the dates indicated: March 31, 2019 December 31, 2018 Ownership Investment Amount Ownership Investment Amount Amberjack – Series A / Series B 75.0% / 50.0% $ 444 75.0% / 50.0% $ 458 Mars 71.5% 167 71.5% 169 Bengal 50.0% 84 50.0% 82 Permian Basin 50.0% 76 50.0% 72 LOCAP 41.48% 9 41.48% 8 Poseidon 36.0% — 36.0% — Proteus 10.0% 16 10.0% 16 Endymion 10.0% 18 10.0% 18 $ 814 $ 823 Unamortized differences in the basis of the initial investments and our interest in the separate net assets within the financial statements of the investees are amortized into net income over the remaining useful lives of the underlying assets. As of March 31, 2019 and December 31, 2018, the unamortized basis differences included in our equity investments are $39 million and $40 million, respectively. For both the three months ended March 31, 2019 and March 31, 2018, the net amortization expense was $1 million. During the first quarter of 2018, the investment amount for Poseidon was reduced to zero due to distributions received that were in excess of our investment balance and we, therefore, suspended the equity method of accounting. As we have no commitments to provide further financial support to Poseidon, we have recorded excess distributions of $8 million and $1 million in Other income as of March 31, 2019 and March 31, 2018, respectively. Once our cumulative share of equity earnings becomes greater than the amount of distributions received, we will resume the equity method of accounting as long as the equity method investment balance remains greater than zero. Our equity method investments balance was affected by the following during the periods indicated: Three Months Ended March 31, 2019 Three Months Ended March 31, 2018 Distributions Received Income from Equity Investments Impact of Change in Accounting Policy Distributions Received Income from Equity Investments Impact of Change in Accounting Policy Amberjack (1) $ 37 $ 32 $ (9) $ — $ — $ — Mars 31 29 — 32 25 (7) Bengal 3 5 — 4 4 — Poseidon (2) 8 — — 9 6 — Other (3) 4 4 — 6 5 — $ 83 $ 70 $ (9) $ 51 $ 40 $ (7) (1) We acquired an interest in Amberjack in May 2018. The acquisition of this interest has been accounted for prospectively. (2) As stated above, the equity method of accounting has been suspended for Poseidon and excess distributions are recorded in Other income. (3) Included in Other is the activity associated with our investments in Permian Basin, LOCAP, Proteus and Endymion. The adoption of the revenue standard for the majority of our equity method investments followed the non-public business entity adoption date of January 1, 2019 for their stand-alone financial statements, with the exception of Mars and Permian Basin who adopted on January 1, 2018. As a result of the adoption of the revenue standard on January 1, 2019, we recognized our proportionate share of Amberjack's cumulative effect transition adjustments as a decrease to opening equity (deficit) in the amount of $9 million under the modified retrospective transition method. Under the new lease standard (as defined in Note 7 - Leases ), the adoption date for our equity method investments will follow the non-public business entity adoption date of January 1, 2020 for their stand-alone financial statements. Summarized Financial Information The following tables present aggregated selected unaudited income statement data for our equity method investments (on a 100% basis): Three Months Ended March 31, 2019 Total revenues Total operating expenses Operating income Net income Statements of Income Amberjack $ 81 $ 19 $ 62 $ 62 Mars 63 22 41 41 Bengal 18 7 11 11 Poseidon 31 9 22 20 Other (1) 30 18 12 9 ( 1 ) Included in Other is the activity associated with our investments in Permian Basin, LOCAP, Proteus and Endymion. Three Months Ended March 31, 2018 Total revenues Total operating expenses Operating income Net income Statements of Income Mars $ 57 $ 21 $ 36 $ 36 Bengal 15 4 11 9 Poseidon 29 9 20 19 Other (1) 39 18 21 19 (1) Included in Other is the activity associated with our investments in Permian Basin, LOCAP, Proteus and Endymion. Capital Contributions We make capital contributions for our pro rata interest in Permian Basin to fund capital and other expenditures. We have made capital contributions of $5 million during the first quarter of 2019. |
Equity (Deficit)
Equity (Deficit) | 3 Months Ended |
Mar. 31, 2019 | |
Equity [Abstract] | |
Equity (Deficit) | (Deficit) Equity Our capital accounts are comprised of 2% general partner interests and 98% limited partner interests. The common units represent limited partner interests in us. The holders of common units, both public and SPLC, are entitled to participate in partnership distributions and have limited rights of ownership as provided for under our partnership agreement. Our general partner participates in our distributions and also currently holds IDR’s that entitle it to receive increasing percentages of the cash we distribute from operating surplus. Shelf Registrations We have a universal shelf registration statement on Form S-3 on file with the SEC under which we, as a well-known seasoned issuer, have the ability to issue and sell an indeterminate amount of common units and partnership securities representing limited partner units. We also have on file with the SEC a shelf registration statement on Form S-3 relating to $1,000,000,000 of common units and partnership securities representing limited partner units to be used in connection with the at-the-market equity distribution program, direct sales, or other sales consistent with the plan of distribution set forth in the registration statement. Public Offering and Private Placement On February 6, 2018, we completed the sale of 25,000,000 common units in a registered public offering for $673 million net proceeds ($680 million gross proceeds, or $27.20 per common unit, less $6 million of underwriter’s fees and $1 million of transaction fees). In connection with the issuance of common units, we issued 510,204 general partner units to our general partner for $14 million in order to maintain its 2% general partner interest in us. On February 6, 2018, we also completed the sale of 11,029,412 common units in a private placement with Shell Midstream LP Holdings LLC, an indirect subsidiary of Shell, for an aggregate purchase price of $300 million, or $27.20 per common unit. In connection with the issuance of the common units, we issued 225,091 general partner units to the general partner for $6 million in order to maintain its 2% general partner interest in us. We used net proceeds from these sales to repay $247 million of borrowings outstanding under the Five Five At-the-Market Program On March 2, 2016, we commenced an “at-the-market” equity distribution program pursuant to which we may issue and sell common units for up to $300 million in gross proceeds. During the three months ended March 31, 2019 and March 31, 2018, we did not have any sales under this program. Units Outstanding As of both March 31, 2019 and December 31, 2018, we had 223,811,781 common units outstanding, of which 123,832,233 were publicly owned. SPLC owned 99,979,548 common units, representing an aggregate 43.8% limited partner interest in us, all of the IDR’s, and 4,567,588 general partner units, representing a 2% general partner interest in us. Distributions to our Unitholders Our sponsor has elected to waive $50 million of IDR’s in 2019 to be used for future investment by the Partnership. See Note 2 - Related Party Transactions for terms of the Second Amendment. The following table details the distributions declared and/or paid for the periods presented: Date Paid or Public SPLC General Partner Distributions to be Paid Three Months Ended Common Common IDR's 2% Total (in millions, except per unit amounts) February 14, 2018 December 31, 2017 $ 33 $ 30 $ 18 $ 2 $ 83 $ 0.33300 May 15, 2018 March 31, 2018 43 35 26 2 106 0.34800 August 14, 2018 June 30, 2018 45 36 30 2 113 0.36500 November 14, 2018 September 30, 2018 47 38 33 3 121 0.38200 February 14, 2019 December 31, 2018 49 40 37 3 129 0.40000 May 15, 2019 March 31, 2019 (1) (2) 51 42 23 3 119 0.41500 (1) For more information see Note 13 — Subsequent Events . (2) Includes the impact of waiving distributions to the holders of IDR's. See Note 2 - Related Party Transactions for additional information. Distributions to Noncontrolling Interests Distributions to SPLC for its noncontrolling interest in Zydeco for the three months ended March 31, 2019 and March 31, 2018 were $1 million and zero, respectively. Distributions to GEL for its noncontrolling interest in Odyssey for both the three months ended March 31, 2019 and March 31, 2018 were $2 million. See Note 2—Related Party Transactions |
Property, Plant and Equipment
Property, Plant and Equipment | 3 Months Ended |
Mar. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | Property, Plant and Equipment Property, plant and equipment consist of the following as of the dates indicated: Depreciable Life March 31, 2019 December 31, 2018 Land — $ 12 $ 11 Building and improvements 10 - 40 years 40 39 Pipeline and equipment (1) 10 - 30 years 1,196 1,162 Other 5 - 25 years 18 18 1,266 1,230 Accumulated depreciation and amortization (2) (579) (567) 687 663 Construction in progress 53 79 Property, plant and equipment, net $ 740 $ 742 (1) As of both March 31, 2019 and December 31, 2018, includes cost of $366 million, related to assets under operating lease (as lessor). As of both March 31, 2019 and December 31, 2018, includes cost of $23 million related to right-of-use ( “ROU”) assets under finance lease (as lessee). (2) As of March 31, 2019 and December 31, 2018, includes accumulated depreciation of $124 million and $121 million, respectively, related to assets under operating lease (as lessor). As of both March 31, 2019 and December 31, 2018, includes accumulated amortization of $5 million, related to ROU assets under finance lease (as lessee). Depreciation and amortization expense on property, plant and equipment for the three months ended March 31, 2019 and March 31, 2018 of $12 million and $11 million, respectively, is included in costs and expenses in the accompanying unaudited consolidated statements of income. Depreciation and amortization expense on property, plant and equipment includes amounts pertaining to assets under operating (as lessor) and finance leases (as lessee). |
Accrued Liabilities - Third Par
Accrued Liabilities - Third Parties | 3 Months Ended |
Mar. 31, 2019 | |
Payables and Accruals [Abstract] | |
Accrued Liabilities - Third Parties | Accrued Liabilities – Third Parties Accrued liabilities – third parties consist of the following as of the dates indicated: March 31, 2019 December 31, 2018 Project accruals $ 5 $ 7 Property taxes 5 4 Other accrued liabilities 2 2 Total accrued liabilities – third parties $ 12 $ 13 See Note 2—Related Party Transactions for a discussion of Accrued liabilities – related parties. |
Related Party Debt
Related Party Debt | 3 Months Ended |
Mar. 31, 2019 | |
Debt Disclosure [Abstract] | |
Related Party Debt | Related Party Debt Consolidated related party debt obligations comprise the following as of the dates indicated: March 31, 2019 December 31, 2018 Outstanding Balance Total Capacity Available Capacity Outstanding Balance Total Capacity Available Capacity Seven Year Fixed Facility $ 600 $ 600 $ — $ 600 $ 600 $ — Five Year Revolver due July 2023 494 760 266 494 760 266 Five Year Revolver due December 2022 400 1,000 600 400 1,000 600 Five Year Fixed Facility 600 600 — 600 600 — Zydeco Revolver — 30 30 — 30 30 Unamortized debt issuance costs (3) n/a n/a (3) n/a n/a Debt payable – related party $ 2,091 $ 2,990 $ 896 $ 2,091 $ 2,990 $ 896 For the three months ended March 31, 2019 and March 31, 2018, interest and fee expenses associated with our borrowings were $20 million and $10 million, respectively, of which we paid $20 million and $11 million, respectively. Borrowings under our revolving credit facilities approximate fair value as the interest rates are variable and reflective of market rates, which results in Level 2 instruments. The fair value of our Five Seven On February 6, 2018, we used net proceeds from sales of common units and from our general partner’s proportionate capital contribution to repay $247 million of borrowings outstanding under our Five Year Revolver due July 2023 and $726 million of borrowings outstanding under our Five Year Revolver due December 2022. For additional information on our credit facilities, refer to Note 9 – Related Party Debt in the Notes to Consolidated Financial Statements in our 2018 Annual Report. Borrowings and repayments under our credit facilities for the three months ended March 31, 2019 and March 31, 2018 are disclosed in our unaudited consolidated statements of cash flows. See Note 8 – (Deficit) Equity |
Leases
Leases | 3 Months Ended |
Mar. 31, 2019 | |
Leases [Abstract] | |
Leases | Leases Adoption of ASC Topic 842 “Leases” On January 1, 2019, we adopted ASC Topic 842 (“the new lease standard”) by applying the modified retrospective approach to all leases on January 1, 2019. We elected the package of practical expedients upon transition that permits us to not reassess (1) whether any contracts entered into prior to adoption are or contain leases, (2) the lease classification of existing leases and (3) initial direct costs for any leases that existed prior to adoption. We also elected the practical expedient to not evaluate existing or expired land easements that were not accounted for as leases under previous guidance. Generally, we account for term-based land easements where we control the use of the land surface as leases. Upon adoption on January 1, 2019, we recognized operating lease ROU assets and corresponding lease liabilities of $5 million. As lessor, the accounting for operating leases has not changed and the adoption did not have an impact on our existing transportation and terminaling services agreements that are considered operating leases. As lessee, the accounting for finance leases (capital leases) was substantially unchanged. Lessee accounting We determine if an arrangement is or contains a lease at inception. Our assessment is based on (1) whether the contract involves the use of a distinct identified asset, (2) whether we obtain the right to substantially all the economic benefit from the use of the asset throughout the period and (3) whether we have the right to direct the use of the asset. Leases are classified as either finance leases or operating leases. A lease is classified as a finance lease if any one of the following criteria are met: the lease transfers ownership of the asset by the end of the lease term, the lease contains an option to purchase the asset that is reasonably certain to be exercised, the lease term is for a major part of the remaining useful life of the asset or the present value of the lease payments equals or exceeds substantially all of the fair value of the asset. A lease is classified as an operating lease if it does not meet any one of these criteria. The lease classification affects the expense recognition in the income statement. Operating lease costs are recorded entirely in operating expenses. Finance lease costs are split, where amortization of the ROU asset is recorded in operating expenses and an implied interest component is recorded in interest expense. Under the new lease standard, operating leases (as lessee) are included in Operating lease right-of-use assets, Accrued liabilities - third parties and Operating lease liabilities in our unaudited consolidated balance sheets. Finance leases (as lessee) are included in Property, plant and equipment, Accrued liabilities – third parties and Finance lease liabilities in our unaudited consolidated balance sheets. ROU assets and lease liabilities are recognized at commencement date based on the present value of the future minimum lease payments over the lease term. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at transition date in determining the present value of future payments. The ROU asset includes any lease payments made but excludes lease incentives and initial direct costs incurred, if any. Our ROU assets and lease liabilities may include options to extend the lease when it is reasonably certain that we will exercise that option. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. We have long-term non-cancelable third-party operating leases for land. Several of the leases provide for renewal terms. We hold cancelable easements or rights-of-way arrangements from landowners permitting the use of land for the construction and operation of our pipeline systems. Obligations under these easements are not material to the results of our operations. In addition, Odyssey has a third-party operating lease for use of offshore platform space at Main Pass 289C. This lease will continue to be in effect until the continued operation of the platform is uneconomic. We are also obligated under two finance leases. We have a terminaling services agreement in which we took possession of certain storage tanks located in Port Neches, Texas and a lease of offshore platform space on the Garden Banks 128 “A” platform. Lease extensions. Many of our leases have options to either extend or terminate the lease. In determining the lease term, we considered all available contract extensions which are reasonably certain of occurring. In many cases, the lease term is equal to the economic life of the underlying asset. Significant assumptions and judgments Incremental borrowing rate. We are generally not made aware of the interest rate implicit in a lease due to several reasons, including: (1) uncertainty as to the total amount of the costs incurred by the lessor in negotiating the lease or whether certain costs incurred by the lessor would qualify as initial direct costs and (2) uncertainty as to the lessor’s expectation of the residual value of the asset at the end of the lease. Therefore, we use our incremental borrowing rate (“IBR”) at the commencement of the lease and estimate the IBR for each lease agreement taking into consideration lease contract term, collateral and entity credit ratings, and use sensitivity analyses to evaluate the reasonableness of the rates determined. Lease balances and costs The following tables summarize our lease costs as of and for the three months ended March 31, 2019: Leases Classification March 31, 2019 Assets Operating lease assets Operating lease right-of-use assets $ 5 Finance lease assets Property, plant and equipment, net (1) 18 Total lease assets $ 23 Liabilities Current Finance Accrued liabilities - third parties $ 1 Noncurrent Operating Operating lease liabilities 5 Finance Finance lease liabilities 25 Total lease liabilities $ 31 (1) Finance lease assets are recorded net of accumulated amortization of $5 million as of March 31, 2019. Three Months Ended Lease cost Classification March 31, 2019 Operating lease cost (1) Operations and maintenance - third parties $ — Finance lease cost (cost resulting from lease payments): Amortization of leased assets (1) Depreciation and amortization — Interest on lease liabilities Interest expense, net 1 Total lease cost $ 1 (1) Amounts for the three months ended March 31, 2019 were less than $1 million. Other information March 31, 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases (1) $ — Operating cash flows from finance leases (1) — Financing cash flows from finance leases (1) — Weighted-average remaining lease term (years) Operating leases 20 Finance leases 12 Weighted-average discount rate Operating leases 5.8 % Finance leases 14.3 % (1) Amounts for the three months ended March 31, 2019 were less than $1 million. Annual maturity analysis The future annual maturity of lease payments as of March 31, 2019 for the above lease obligations were: Maturity of lease liabilities Operating leases (1) Finance leases ( 2 ) Total 2019 $ — $ 3 $ 3 2020 — 4 4 2021 1 4 5 2022 — 4 4 2023 1 4 5 Remainder 6 37 43 Total lease payments 8 56 64 Less: Interest ( 3 ) (3) (30) (33) Present value of lease liabilities ( 4 ) $ 5 $ 26 $ 31 (1) Operating lease payments include $2 million related to options to extend lease terms that are reasonably certain of being exercised. ( 2 ) Includes $26 million in principal and excludes $9 million in executory costs. ( 3 ) Calculated using the interest rate for each lease. ( 4 ) Includes the current portion of $1 million for the finance lease. Lessor accounting We have certain transportation and terminaling services agreements with related parties entered into prior to the adoption date of January 1, 2019 that are considered operating leases and include both lease and non-lease components. Certain of these agreements were entered into for terms of ten years with the option to extend for two additional five year terms, and we have additional agreements with an initial term of ten years with the option to extend for up to ten additional one year terms. It is reasonably certain that these contracts will be extended. Our transportation, terminaling and storage services revenue and lease revenue from related parties for the three months ended March 31, 2019 and March 31, 2018 are disclosed in Note 9 – Revenue Recognition . Our risk management strategy for the residual assets is mitigated by the long-term nature of the underlying assets and the long-term nature of our lease agreements. Significant assumptions and judgments Lease and non-lease components. Certain of our revenues are accounted for under Topic 842, Leases, as the underlying contracts convey the right to control the use of the identified asset for a period of time. We allocate the arrangement consideration between the lease components that fall within the scope of ASC Topic 842 and any non-lease service components within the scope of ASC Topic 606 based on the relative stand-alone selling price of each component. See Note 9 – Revenue Recognition for additional information regarding the allocation of the consideration in a contract between the lease and non-lease components. Annual maturity analysis As of March 31, 2019, future annual maturity of lease payments to be received under the contract terms of these operating leases, which includes only the lease components of these leases, were estimated to be: Maturity of lease liabilities Operating leases (1) 2019 $ 42 2020 56 2021 56 2022 56 2023 56 Remainder 750 Total lease payments $ 1,016 (1) Operating lease payments include $555 million related to options to extend lease terms that are reasonably certain of being exercised. |
Leases | Leases Adoption of ASC Topic 842 “Leases” On January 1, 2019, we adopted ASC Topic 842 (“the new lease standard”) by applying the modified retrospective approach to all leases on January 1, 2019. We elected the package of practical expedients upon transition that permits us to not reassess (1) whether any contracts entered into prior to adoption are or contain leases, (2) the lease classification of existing leases and (3) initial direct costs for any leases that existed prior to adoption. We also elected the practical expedient to not evaluate existing or expired land easements that were not accounted for as leases under previous guidance. Generally, we account for term-based land easements where we control the use of the land surface as leases. Upon adoption on January 1, 2019, we recognized operating lease ROU assets and corresponding lease liabilities of $5 million. As lessor, the accounting for operating leases has not changed and the adoption did not have an impact on our existing transportation and terminaling services agreements that are considered operating leases. As lessee, the accounting for finance leases (capital leases) was substantially unchanged. Lessee accounting We determine if an arrangement is or contains a lease at inception. Our assessment is based on (1) whether the contract involves the use of a distinct identified asset, (2) whether we obtain the right to substantially all the economic benefit from the use of the asset throughout the period and (3) whether we have the right to direct the use of the asset. Leases are classified as either finance leases or operating leases. A lease is classified as a finance lease if any one of the following criteria are met: the lease transfers ownership of the asset by the end of the lease term, the lease contains an option to purchase the asset that is reasonably certain to be exercised, the lease term is for a major part of the remaining useful life of the asset or the present value of the lease payments equals or exceeds substantially all of the fair value of the asset. A lease is classified as an operating lease if it does not meet any one of these criteria. The lease classification affects the expense recognition in the income statement. Operating lease costs are recorded entirely in operating expenses. Finance lease costs are split, where amortization of the ROU asset is recorded in operating expenses and an implied interest component is recorded in interest expense. Under the new lease standard, operating leases (as lessee) are included in Operating lease right-of-use assets, Accrued liabilities - third parties and Operating lease liabilities in our unaudited consolidated balance sheets. Finance leases (as lessee) are included in Property, plant and equipment, Accrued liabilities – third parties and Finance lease liabilities in our unaudited consolidated balance sheets. ROU assets and lease liabilities are recognized at commencement date based on the present value of the future minimum lease payments over the lease term. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at transition date in determining the present value of future payments. The ROU asset includes any lease payments made but excludes lease incentives and initial direct costs incurred, if any. Our ROU assets and lease liabilities may include options to extend the lease when it is reasonably certain that we will exercise that option. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. We have long-term non-cancelable third-party operating leases for land. Several of the leases provide for renewal terms. We hold cancelable easements or rights-of-way arrangements from landowners permitting the use of land for the construction and operation of our pipeline systems. Obligations under these easements are not material to the results of our operations. In addition, Odyssey has a third-party operating lease for use of offshore platform space at Main Pass 289C. This lease will continue to be in effect until the continued operation of the platform is uneconomic. We are also obligated under two finance leases. We have a terminaling services agreement in which we took possession of certain storage tanks located in Port Neches, Texas and a lease of offshore platform space on the Garden Banks 128 “A” platform. Lease extensions. Many of our leases have options to either extend or terminate the lease. In determining the lease term, we considered all available contract extensions which are reasonably certain of occurring. In many cases, the lease term is equal to the economic life of the underlying asset. Significant assumptions and judgments Incremental borrowing rate. We are generally not made aware of the interest rate implicit in a lease due to several reasons, including: (1) uncertainty as to the total amount of the costs incurred by the lessor in negotiating the lease or whether certain costs incurred by the lessor would qualify as initial direct costs and (2) uncertainty as to the lessor’s expectation of the residual value of the asset at the end of the lease. Therefore, we use our incremental borrowing rate (“IBR”) at the commencement of the lease and estimate the IBR for each lease agreement taking into consideration lease contract term, collateral and entity credit ratings, and use sensitivity analyses to evaluate the reasonableness of the rates determined. Lease balances and costs The following tables summarize our lease costs as of and for the three months ended March 31, 2019: Leases Classification March 31, 2019 Assets Operating lease assets Operating lease right-of-use assets $ 5 Finance lease assets Property, plant and equipment, net (1) 18 Total lease assets $ 23 Liabilities Current Finance Accrued liabilities - third parties $ 1 Noncurrent Operating Operating lease liabilities 5 Finance Finance lease liabilities 25 Total lease liabilities $ 31 (1) Finance lease assets are recorded net of accumulated amortization of $5 million as of March 31, 2019. Three Months Ended Lease cost Classification March 31, 2019 Operating lease cost (1) Operations and maintenance - third parties $ — Finance lease cost (cost resulting from lease payments): Amortization of leased assets (1) Depreciation and amortization — Interest on lease liabilities Interest expense, net 1 Total lease cost $ 1 (1) Amounts for the three months ended March 31, 2019 were less than $1 million. Other information March 31, 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases (1) $ — Operating cash flows from finance leases (1) — Financing cash flows from finance leases (1) — Weighted-average remaining lease term (years) Operating leases 20 Finance leases 12 Weighted-average discount rate Operating leases 5.8 % Finance leases 14.3 % (1) Amounts for the three months ended March 31, 2019 were less than $1 million. Annual maturity analysis The future annual maturity of lease payments as of March 31, 2019 for the above lease obligations were: Maturity of lease liabilities Operating leases (1) Finance leases ( 2 ) Total 2019 $ — $ 3 $ 3 2020 — 4 4 2021 1 4 5 2022 — 4 4 2023 1 4 5 Remainder 6 37 43 Total lease payments 8 56 64 Less: Interest ( 3 ) (3) (30) (33) Present value of lease liabilities ( 4 ) $ 5 $ 26 $ 31 (1) Operating lease payments include $2 million related to options to extend lease terms that are reasonably certain of being exercised. ( 2 ) Includes $26 million in principal and excludes $9 million in executory costs. ( 3 ) Calculated using the interest rate for each lease. ( 4 ) Includes the current portion of $1 million for the finance lease. Lessor accounting We have certain transportation and terminaling services agreements with related parties entered into prior to the adoption date of January 1, 2019 that are considered operating leases and include both lease and non-lease components. Certain of these agreements were entered into for terms of ten years with the option to extend for two additional five year terms, and we have additional agreements with an initial term of ten years with the option to extend for up to ten additional one year terms. It is reasonably certain that these contracts will be extended. Our transportation, terminaling and storage services revenue and lease revenue from related parties for the three months ended March 31, 2019 and March 31, 2018 are disclosed in Note 9 – Revenue Recognition . Our risk management strategy for the residual assets is mitigated by the long-term nature of the underlying assets and the long-term nature of our lease agreements. Significant assumptions and judgments Lease and non-lease components. Certain of our revenues are accounted for under Topic 842, Leases, as the underlying contracts convey the right to control the use of the identified asset for a period of time. We allocate the arrangement consideration between the lease components that fall within the scope of ASC Topic 842 and any non-lease service components within the scope of ASC Topic 606 based on the relative stand-alone selling price of each component. See Note 9 – Revenue Recognition for additional information regarding the allocation of the consideration in a contract between the lease and non-lease components. Annual maturity analysis As of March 31, 2019, future annual maturity of lease payments to be received under the contract terms of these operating leases, which includes only the lease components of these leases, were estimated to be: Maturity of lease liabilities Operating leases (1) 2019 $ 42 2020 56 2021 56 2022 56 2023 56 Remainder 750 Total lease payments $ 1,016 (1) Operating lease payments include $555 million related to options to extend lease terms that are reasonably certain of being exercised. |
Leases | Leases Adoption of ASC Topic 842 “Leases” On January 1, 2019, we adopted ASC Topic 842 (“the new lease standard”) by applying the modified retrospective approach to all leases on January 1, 2019. We elected the package of practical expedients upon transition that permits us to not reassess (1) whether any contracts entered into prior to adoption are or contain leases, (2) the lease classification of existing leases and (3) initial direct costs for any leases that existed prior to adoption. We also elected the practical expedient to not evaluate existing or expired land easements that were not accounted for as leases under previous guidance. Generally, we account for term-based land easements where we control the use of the land surface as leases. Upon adoption on January 1, 2019, we recognized operating lease ROU assets and corresponding lease liabilities of $5 million. As lessor, the accounting for operating leases has not changed and the adoption did not have an impact on our existing transportation and terminaling services agreements that are considered operating leases. As lessee, the accounting for finance leases (capital leases) was substantially unchanged. Lessee accounting We determine if an arrangement is or contains a lease at inception. Our assessment is based on (1) whether the contract involves the use of a distinct identified asset, (2) whether we obtain the right to substantially all the economic benefit from the use of the asset throughout the period and (3) whether we have the right to direct the use of the asset. Leases are classified as either finance leases or operating leases. A lease is classified as a finance lease if any one of the following criteria are met: the lease transfers ownership of the asset by the end of the lease term, the lease contains an option to purchase the asset that is reasonably certain to be exercised, the lease term is for a major part of the remaining useful life of the asset or the present value of the lease payments equals or exceeds substantially all of the fair value of the asset. A lease is classified as an operating lease if it does not meet any one of these criteria. The lease classification affects the expense recognition in the income statement. Operating lease costs are recorded entirely in operating expenses. Finance lease costs are split, where amortization of the ROU asset is recorded in operating expenses and an implied interest component is recorded in interest expense. Under the new lease standard, operating leases (as lessee) are included in Operating lease right-of-use assets, Accrued liabilities - third parties and Operating lease liabilities in our unaudited consolidated balance sheets. Finance leases (as lessee) are included in Property, plant and equipment, Accrued liabilities – third parties and Finance lease liabilities in our unaudited consolidated balance sheets. ROU assets and lease liabilities are recognized at commencement date based on the present value of the future minimum lease payments over the lease term. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at transition date in determining the present value of future payments. The ROU asset includes any lease payments made but excludes lease incentives and initial direct costs incurred, if any. Our ROU assets and lease liabilities may include options to extend the lease when it is reasonably certain that we will exercise that option. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. We have long-term non-cancelable third-party operating leases for land. Several of the leases provide for renewal terms. We hold cancelable easements or rights-of-way arrangements from landowners permitting the use of land for the construction and operation of our pipeline systems. Obligations under these easements are not material to the results of our operations. In addition, Odyssey has a third-party operating lease for use of offshore platform space at Main Pass 289C. This lease will continue to be in effect until the continued operation of the platform is uneconomic. We are also obligated under two finance leases. We have a terminaling services agreement in which we took possession of certain storage tanks located in Port Neches, Texas and a lease of offshore platform space on the Garden Banks 128 “A” platform. Lease extensions. Many of our leases have options to either extend or terminate the lease. In determining the lease term, we considered all available contract extensions which are reasonably certain of occurring. In many cases, the lease term is equal to the economic life of the underlying asset. Significant assumptions and judgments Incremental borrowing rate. We are generally not made aware of the interest rate implicit in a lease due to several reasons, including: (1) uncertainty as to the total amount of the costs incurred by the lessor in negotiating the lease or whether certain costs incurred by the lessor would qualify as initial direct costs and (2) uncertainty as to the lessor’s expectation of the residual value of the asset at the end of the lease. Therefore, we use our incremental borrowing rate (“IBR”) at the commencement of the lease and estimate the IBR for each lease agreement taking into consideration lease contract term, collateral and entity credit ratings, and use sensitivity analyses to evaluate the reasonableness of the rates determined. Lease balances and costs The following tables summarize our lease costs as of and for the three months ended March 31, 2019: Leases Classification March 31, 2019 Assets Operating lease assets Operating lease right-of-use assets $ 5 Finance lease assets Property, plant and equipment, net (1) 18 Total lease assets $ 23 Liabilities Current Finance Accrued liabilities - third parties $ 1 Noncurrent Operating Operating lease liabilities 5 Finance Finance lease liabilities 25 Total lease liabilities $ 31 (1) Finance lease assets are recorded net of accumulated amortization of $5 million as of March 31, 2019. Three Months Ended Lease cost Classification March 31, 2019 Operating lease cost (1) Operations and maintenance - third parties $ — Finance lease cost (cost resulting from lease payments): Amortization of leased assets (1) Depreciation and amortization — Interest on lease liabilities Interest expense, net 1 Total lease cost $ 1 (1) Amounts for the three months ended March 31, 2019 were less than $1 million. Other information March 31, 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases (1) $ — Operating cash flows from finance leases (1) — Financing cash flows from finance leases (1) — Weighted-average remaining lease term (years) Operating leases 20 Finance leases 12 Weighted-average discount rate Operating leases 5.8 % Finance leases 14.3 % (1) Amounts for the three months ended March 31, 2019 were less than $1 million. Annual maturity analysis The future annual maturity of lease payments as of March 31, 2019 for the above lease obligations were: Maturity of lease liabilities Operating leases (1) Finance leases ( 2 ) Total 2019 $ — $ 3 $ 3 2020 — 4 4 2021 1 4 5 2022 — 4 4 2023 1 4 5 Remainder 6 37 43 Total lease payments 8 56 64 Less: Interest ( 3 ) (3) (30) (33) Present value of lease liabilities ( 4 ) $ 5 $ 26 $ 31 (1) Operating lease payments include $2 million related to options to extend lease terms that are reasonably certain of being exercised. ( 2 ) Includes $26 million in principal and excludes $9 million in executory costs. ( 3 ) Calculated using the interest rate for each lease. ( 4 ) Includes the current portion of $1 million for the finance lease. Lessor accounting We have certain transportation and terminaling services agreements with related parties entered into prior to the adoption date of January 1, 2019 that are considered operating leases and include both lease and non-lease components. Certain of these agreements were entered into for terms of ten years with the option to extend for two additional five year terms, and we have additional agreements with an initial term of ten years with the option to extend for up to ten additional one year terms. It is reasonably certain that these contracts will be extended. Our transportation, terminaling and storage services revenue and lease revenue from related parties for the three months ended March 31, 2019 and March 31, 2018 are disclosed in Note 9 – Revenue Recognition . Our risk management strategy for the residual assets is mitigated by the long-term nature of the underlying assets and the long-term nature of our lease agreements. Significant assumptions and judgments Lease and non-lease components. Certain of our revenues are accounted for under Topic 842, Leases, as the underlying contracts convey the right to control the use of the identified asset for a period of time. We allocate the arrangement consideration between the lease components that fall within the scope of ASC Topic 842 and any non-lease service components within the scope of ASC Topic 606 based on the relative stand-alone selling price of each component. See Note 9 – Revenue Recognition for additional information regarding the allocation of the consideration in a contract between the lease and non-lease components. Annual maturity analysis As of March 31, 2019, future annual maturity of lease payments to be received under the contract terms of these operating leases, which includes only the lease components of these leases, were estimated to be: Maturity of lease liabilities Operating leases (1) 2019 $ 42 2020 56 2021 56 2022 56 2023 56 Remainder 750 Total lease payments $ 1,016 (1) Operating lease payments include $555 million related to options to extend lease terms that are reasonably certain of being exercised. |
Revenue Recognition
Revenue Recognition | 3 Months Ended |
Mar. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | Revenue RecognitionThe revenue standard’s core principle is that a company will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. The revenue standard requires entities to recognize revenue through the application of a five-step model, which includes: identification of the contract; identification of the performance obligations; determination of the transaction price; allocation of the transaction price to the performance obligations; and recognition of revenue as the entity satisfies the performance obligations. Disaggregation of Revenue The following table provides information about disaggregated revenue by service type and customer type: Three Months Ended March 31, 2019 2018 Transportation services revenue – third parties $ 40 $ 32 Transportation services revenue – related parties (1) 50 31 Storage services revenue – third parties 2 3 Storage services revenue – related parties 2 1 Terminaling services revenue – related parties (2) 12 11 Product revenue – third parties (3) 1 — Product revenue – related parties (3) 10 8 Total Topic 606 revenue 117 86 Lease revenue – related parties 14 14 Total revenue $ 131 $ 100 (1) Transportation services revenue - related parties includes $1 million of the non-lease service component in our transportation services contracts for both the three months ended March 31, 2019 and March 31, 2018. (2) Terminaling services revenue - related parties is entirely comprised of the non-lease service component in our terminaling services contracts. (3) Product revenue is comprised of allowance oil sales. Lease revenue Certain of our long-term transportation and terminaling services contracts with related parties are accounted for as operating leases under Topic 840, Leases, prior to January 1, 2019 and Topic 842, Leases, on or subsequent to January 1, 2019. These agreements have both a lease component and an implied operation and maintenance service component (“non-lease service component”). We allocate the arrangement consideration between the lease components that fall within the scope of Topic 840 or Topic 842 and any non-lease service components within the scope of the revenue standard based on the relative stand-alone selling price of each component. We estimate the stand-alone selling price of the lease and non-lease service components based on an analysis of service-related and lease-related costs for each contract, adjusted for a representative profit margin. The contracts have a minimum fixed monthly payment for both the lease and non-lease service components. We present the non-lease service components under the revenue standard within Transportation, terminaling and storage services – related parties in the unaudited consolidated statements of income. Revenues from the lease components of these agreements are recorded within Lease revenue – related parties in the unaudited consolidated statements of income. Certain of these agreements were entered into for terms of ten years, with the option to extend for two additional five one ten Total Less than 1 year Years 2 to 3 Years 4 to 5 More than 5 years Operating leases $ 907 $ 108 $ 215 $ 217 $ 367 Contract Balances The following table provides information about receivables and contract liabilities from contracts with customers: January 1, 2019 March 31, 2019 Receivables from contracts with customers – third parties $ 19 $ 14 Receivables from contracts with customers – related parties 21 22 Deferred revenue – third parties 8 1 Deferred revenue – related party 3 1 Significant changes in the deferred revenue balances with customers during the period are as follows: December 31, 2018 Additions (1) Reductions (2) March 31, 2019 Deferred revenue – third parties $ 8 $ — $ (7) $ 1 Deferred revenue – related party 3 — (2) 1 (1) Contract liability additions resulted from deficiency payments from minimum volume commitment contracts. (2) Contract liability reductions resulted from revenue earned through the actual or estimated use and expiration of deficiency credits. We currently have no assets recognized from the costs to obtain or fulfill a contract as of both March 31, 2019 and December 31, 2018. Remaining Performance Obligations The following table includes revenue expected to be recognized in the future related to performance obligations exceeding one year of their initial terms that are unsatisfied or partially unsatisfied as of March 31, 2019: Total 2019 2020 2021 2022 2023 and beyond Revenue expected to be recognized on multi-year committed shipper transportation contracts in place as of March 31, 2019 (1) $ 517 $ 42 $ 50 $ 50 $ 50 $ 325 Revenue expected to be recognized on other multi-year committed shipper transportation contracts in place as of March 31, 2019 (2) 42 4 5 5 5 23 Revenue expected to be recognized on multi-year storage service contracts in place as of March 31, 2019 3 3 — — — — Revenue expected to be recognized on other multi-year terminaling service contracts in place as of March 31, 2019 (2) 406 35 47 47 47 230 $ 968 $ 84 $ 102 $ 102 $ 102 $ 578 (1) Excludes revenue deferred for deficiency payments. (2) Relates to the non-lease service components of certain of our long-term transportation and terminaling service contracts which are accounted for as operating leases. |
Net Income Per Limited Partner
Net Income Per Limited Partner Unit | 3 Months Ended |
Mar. 31, 2019 | |
Partners' Capital Notes [Abstract] | |
Net Income Per Limited Partner Unit | Net Income Per Limited Partner Unit Net income per unit applicable to common limited partner units is computed by dividing the respective limited partners’ interest in net income attributable to the Partnership for the period by the weighted average number of common units outstanding for the period. Because we have more than one class of participating securities, we use the two-class method when calculating the net income per unit applicable to limited partners. The classes of participating securities include common units, general partner units and IDR’s. Basic and diluted net income per unit are the same because we do not have any potentially dilutive units outstanding for the periods presented. Net income earned by the Partnership is allocated between the limited partners and the general partner (including IDR’s) in accordance with our partnership agreement. Earnings are allocated based on actual cash distributions declared to our unitholders, including those attributable to IDR’s. To the extent net income attributable to the Partnership exceeds or is less than cash distributions, this difference is allocated based on the unitholders’ respective ownership percentages. The following tables show the allocation of net income attributable to the Partnership to arrive at net income per limited partner unit: Three Months Ended March 31, 2019 2018 Net income $ 137 $ 65 Less: Net income attributable to noncontrolling interests 5 1 Net income attributable to the Partnership 132 64 Less: General partner’s distribution declared (1) 26 28 Limited partners’ distribution declared on common units 93 78 Income in excess of / (less than) distributions $ 13 $ (42) ( 1 ) For the three months ended March 31, 2019, this includes the impact of waiving distributions to the holders of IDR’s. See Note 2 - Related Party Transactions for additional information. Three Months Ended March 31, 2019 General Partner Limited Partners’ Common Units Total (in millions of dollars, except per unit data) Distributions declared (1) $ 26 $ 93 $ 119 Income in excess of distributions 1 12 13 Net income attributable to the Partnership $ 27 $ 105 $ 132 Weighted average units outstanding: Basic and diluted 223.8 Net income per limited partner unit: Basic and diluted $ 0.47 ( 1 ) This includes the impact of waiving distributions to the holders of IDR’s. See Note 2 - Related Party Transactions for additional information. Three Months Ended March 31, 2018 General Partner Limited Partners’ Common Units Total (in millions of dollars, except per unit data) Distributions declared $ 28 $ 78 $ 106 Distributions in excess of income (1) (41) (42) Net income attributable to the Partnership $ 27 $ 37 $ 64 Weighted average units outstanding: Basic and diluted 209.4 Net income per limited partner unit: Basic and diluted $ 0.18 |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes We are not a taxable entity for U.S. federal income tax purposes or for the majority of states that impose an income tax. Taxes on our net income are generally borne by our partners through the allocation of taxable income. Our income tax expense results from partnership activity in the state of Texas, as conducted by Zydeco, Sand Dollar and Triton. Income tax expense for both the three months ended March 31, 2019 and March 31, 2018 was not material. With the exception of the operations of Colonial, Explorer and LOCAP, which are treated as corporations for federal income tax purposes, the operations of the Partnership are not subject to federal income tax. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Environmental Matters We are subject to federal, state, and local environmental laws and regulations. We routinely conduct reviews of potential environmental issues and claims that could impact our assets or operations. These reviews assist us in identifying environmental issues and estimating the costs and timing of remediation efforts. In making environmental liability estimations, we consider the material effect of environmental compliance, pending legal actions against us and potential third-party liability claims. Often, as the remediation evaluation and effort progresses, additional information is obtained, requiring revisions to estimated costs. These revisions are reflected in income in the period in which they are probable and reasonably estimable. As of both March 31, 2019 and December 31, 2018, these costs and any related liabilities are not material. Legal Proceedings We are named defendants in lawsuits and governmental proceedings that arise in the ordinary course of business. For each of our outstanding legal matters, we evaluate the merits of the case, our exposure to the matter, possible legal or settlement strategies and the likelihood of an unfavorable outcome. While there are still uncertainties related to the ultimate costs we may incur, based upon our evaluation and experience to date, we do not expect that the ultimate resolution of these matters will have a material adverse effect on our financial position, operating results or cash flows. Indemnification Under the 2019 Omnibus Agreement, certain tax liabilities are indemnified by SPLC. See Note 2 – Related Party Transactions for additional information. Minimum Throughput |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events We have evaluated events that have occurred after March 31, 2019 through the issuance of these unaudited consolidated financial statements. Any material subsequent events that occurred during this time have been properly recognized or disclosed in the unaudited consolidated financial statements and accompanying notes. Distribution On April 24, 2019, the Board declared a cash distribution of $0.4150 per limited partner unit for the three months ended March 31, 2019. The distribution will be paid on May 15, 2019 to unitholders of record as of May 6, 2019. |
Description of Business and B_2
Description of Business and Basis of Presentation (Policies) | 3 Months Ended |
Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business | Description of Business We are a growth-oriented master limited partnership that owns, operates, develops and acquires pipelines and other midstream assets. As of March 31, 2019, our assets include interests in entities that own crude oil and refined products pipelines and terminals that serve as key infrastructure to (i) transport onshore and offshore crude oil production to Gulf Coast and Midwest refining markets and (ii) deliver refined products from those markets to major demand centers. Our assets also include interests in entities that own natural gas and refinery gas pipelines that transport offshore natural gas to market hubs and deliver refinery gas from refineries and plants to chemical sites along the Gulf Coast. |
Basis of Presentation | Basis of Presentation Our unaudited consolidated financial statements include all subsidiaries required to be consolidated under generally accepted accounting principles in the United States (“GAAP”). Our reporting currency is U.S. dollars, and all references to dollars are U.S. dollars. The accompanying unaudited consolidated financial statements and related notes have been prepared in accordance with GAAP for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and notes required by GAAP for complete annual financial statements. The year-end consolidated balance sheet data was derived from audited financial statements. During interim periods, we follow the accounting policies disclosed in our Annual Report on Form 10-K for the year ended December 31, 2018 (our “2018 Annual Report”), filed with the United States Securities and Exchange Commission (“SEC”). The unaudited consolidated financial statements for the three months ended March 31, 2019 and March 31, 2018 include all adjustments we believe are necessary for a fair statement of the results of operations for the interim periods presented. These adjustments are of a normal recurring nature unless otherwise disclosed. Operating results for the interim periods are not necessarily indicative of the results that may be expected for the full year. These unaudited consolidated financial statements and other information included in this Quarterly Report on Form 10-Q should be read in conjunction with our audited consolidated financial statements and notes thereto included in our 2018 Annual Report. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Standards Adopted as of January 1, 2019 In February 2016, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) 2016-02 to Topic 842, Leases. As permitted, we adopted the new standard using the modified retrospective approach, effective January 1, 2019, which provides a method for recording existing leases at the beginning of the period of adoption. As such, results and balances prior to January 1, 2019 are not adjusted and continue to be reported in accordance with our historical accounting under previous GAAP. See Note 7 — Leases for additional information and disclosures required by the new standard. Standards Not Yet Adopted In June 2016, the FASB issued ASU 2016-13 to Topic 326, Financial Instruments — Credit Losses: Measurement of Credit Losses on Financial Instruments, which replaces the current incurred loss impairment method with a method that reflects expected credit losses on financial instruments. The update is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early adoption is permitted for fiscal years beginning after December 15, 2018. While we are still evaluating the impact of ASU 2016-13, we do not expect the adoption of this standard to have a material impact on our consolidated financial statements. |
Description of Business and B_3
Description of Business and Basis of Presentation (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Ownership Percentage | The following table reflects our ownership, and Shell’s retained ownership as of March 31, 2019: SHLX Ownership Shell’s Retained Ownership Pecten Midstream LLC (“Pecten”) 100.0 % — % Sand Dollar Pipeline LLC (“Sand Dollar”) 100.0 % — % Triton West LLC (“Triton”) 100.0 % — % Zydeco Pipeline Company LLC (“Zydeco”) 92.5 % 7.5 % Amberjack Pipeline Company LLC (“Amberjack”) – Series A/Series B 75.0% / 50.0% — % Mars Oil Pipeline Company LLC (“Mars”) 71.5 % — % Odyssey Pipeline L.L.C. (“Odyssey”) 71.0 % — % Bengal Pipeline Company LLC (“Bengal”) 50.0 % — % Crestwood Permian Basin LLC (“Permian Basin”) 50.0 % — % LOCAP LLC (“LOCAP”) 41.48 % — % Poseidon Oil Pipeline Company, L.L.C. (“Poseidon”) 36.0 % — % Explorer Pipeline Company (“Explorer”) 12.62 % 25.97 % Proteus Oil Pipeline Company, LLC (“Proteus”) 10.0 % — % Endymion Oil Pipeline Company, LLC (“Endymion”) 10.0 % — % Colonial Pipeline Company (“Colonial”) 6.0 % 10.12 % Cleopatra Gas Gathering Company, LLC (“Cleopatra”) 1.0 % — % |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Related Party Transactions [Abstract] | |
Schedule of Other Related Party Balances | Other related party balances consist of the following: March 31, 2019 December 31, 2018 Accounts receivable $ 29 $ 29 Prepaid expenses 11 15 Other assets 3 3 Accounts payable (1) 9 9 Deferred revenue 1 3 Accrued liabilities (2) 15 16 Debt payable (3) 2,091 2,091 (1) Accounts payable reflects amounts owed to SPLC for reimbursement of third-party expenses incurred by SPLC for our benefit. (2) As of March 31, 2019, accrued liabilities reflects $14 million accrued interest and $1 million other accrued liabilities. As of December 31, 2018, accrued liabilities reflects $14 million accrued interest and $2 million other accrued liabilities. (3) Debt payable reflects borrowings outstanding after taking into account unamortized debt issuance costs of $3 million as of both March 31, 2019 and December 31, 2018. |
Schedule of Related Party Expenses Including Personnel Costs | The following table shows related party expenses, including certain personnel costs, incurred by Shell and SPLC on our behalf that are reflected in the accompanying unaudited consolidated statements of income for the indicated periods. Included in these amounts, and disclosed below, is our share of operating and general corporate expenses, as well as the fees paid to SPLC under certain agreements. Three Months Ended March 31, 2019 2018 Operations and maintenance – related parties $ 14 $ 13 General and administrative – related parties 11 13 Allocated operating expenses $ 5 $ 4 Allocated general corporate expenses 7 8 Management Agreement fee 2 2 Omnibus Agreement fee 3 2 |
Schedule of Reimbursements from Parent | The following table reflects reimbursements from our Parent for the three months ended March 31, 2019 and March 31, 2018: Three Months Ended March 31, 2019 2018 Cash received (1) $ 7 $ 1 Changes in receivable from Parent ( 2 ) — 3 Total reimbursements ( 3 ) $ 7 $ 4 (1) These reimbursements are included in Other contributions from Parent in the accompanying unaudited consolidated statements of cash flows. ( 2 ) These reimbursements are included in Other non-cash contributions from Parent in the accompanying unaudited consolidated statements of cash flows. ( 3 ) These reimbursements are included in Other contributions from Parent in the accompanying unaudited consolidated statements of (deficit) equity and are exclusive of zero and $1 million for the three months ended March 31, 2019 and March 31, 2018, respectively, related to contributions from Parent. |
Equity Method Investments (Tabl
Equity Method Investments (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Schedule of Equity Investments in Affiliates | Equity method investments comprise the following as of the dates indicated: March 31, 2019 December 31, 2018 Ownership Investment Amount Ownership Investment Amount Amberjack – Series A / Series B 75.0% / 50.0% $ 444 75.0% / 50.0% $ 458 Mars 71.5% 167 71.5% 169 Bengal 50.0% 84 50.0% 82 Permian Basin 50.0% 76 50.0% 72 LOCAP 41.48% 9 41.48% 8 Poseidon 36.0% — 36.0% — Proteus 10.0% 16 10.0% 16 Endymion 10.0% 18 10.0% 18 $ 814 $ 823 |
Schedule of Equity Investments in Affiliates Balance Affected | Our equity method investments balance was affected by the following during the periods indicated: Three Months Ended March 31, 2019 Three Months Ended March 31, 2018 Distributions Received Income from Equity Investments Impact of Change in Accounting Policy Distributions Received Income from Equity Investments Impact of Change in Accounting Policy Amberjack (1) $ 37 $ 32 $ (9) $ — $ — $ — Mars 31 29 — 32 25 (7) Bengal 3 5 — 4 4 — Poseidon (2) 8 — — 9 6 — Other (3) 4 4 — 6 5 — $ 83 $ 70 $ (9) $ 51 $ 40 $ (7) (1) We acquired an interest in Amberjack in May 2018. The acquisition of this interest has been accounted for prospectively. (2) As stated above, the equity method of accounting has been suspended for Poseidon and excess distributions are recorded in Other income. (3) Included in Other is the activity associated with our investments in Permian Basin, LOCAP, Proteus and Endymion. The adoption of the revenue standard for the majority of our equity method investments followed the non-public business entity adoption date of January 1, 2019 for their stand-alone financial statements, with the exception of Mars and Permian Basin who adopted on January 1, 2018. As a result of the adoption of the revenue standard on January 1, 2019, we recognized our proportionate share of Amberjack's cumulative effect transition adjustments as a decrease to opening equity (deficit) in the amount of $9 million under the modified retrospective transition method. Under the new lease standard (as defined in Note 7 - Leases ), the adoption date for our equity method investments will follow the non-public business entity adoption date of January 1, 2020 for their stand-alone financial statements. |
Summary of Income Statement Data for Equity Method Investments | The following tables present aggregated selected unaudited income statement data for our equity method investments (on a 100% basis): Three Months Ended March 31, 2019 Total revenues Total operating expenses Operating income Net income Statements of Income Amberjack $ 81 $ 19 $ 62 $ 62 Mars 63 22 41 41 Bengal 18 7 11 11 Poseidon 31 9 22 20 Other (1) 30 18 12 9 ( 1 ) Included in Other is the activity associated with our investments in Permian Basin, LOCAP, Proteus and Endymion. Three Months Ended March 31, 2018 Total revenues Total operating expenses Operating income Net income Statements of Income Mars $ 57 $ 21 $ 36 $ 36 Bengal 15 4 11 9 Poseidon 29 9 20 19 Other (1) 39 18 21 19 (1) Included in Other is the activity associated with our investments in Permian Basin, LOCAP, Proteus and Endymion. |
Equity (Deficit) (Tables)
Equity (Deficit) (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Equity [Abstract] | |
Schedule of Distributions Declared and/or Paid | The following table details the distributions declared and/or paid for the periods presented: Date Paid or Public SPLC General Partner Distributions to be Paid Three Months Ended Common Common IDR's 2% Total (in millions, except per unit amounts) February 14, 2018 December 31, 2017 $ 33 $ 30 $ 18 $ 2 $ 83 $ 0.33300 May 15, 2018 March 31, 2018 43 35 26 2 106 0.34800 August 14, 2018 June 30, 2018 45 36 30 2 113 0.36500 November 14, 2018 September 30, 2018 47 38 33 3 121 0.38200 February 14, 2019 December 31, 2018 49 40 37 3 129 0.40000 May 15, 2019 March 31, 2019 (1) (2) 51 42 23 3 119 0.41500 (1) For more information see Note 13 — Subsequent Events . (2) Includes the impact of waiving distributions to the holders of IDR's. See Note 2 - Related Party Transactions for additional information. |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Components of Property, Plant and Equipment | Property, plant and equipment consist of the following as of the dates indicated: Depreciable Life March 31, 2019 December 31, 2018 Land — $ 12 $ 11 Building and improvements 10 - 40 years 40 39 Pipeline and equipment (1) 10 - 30 years 1,196 1,162 Other 5 - 25 years 18 18 1,266 1,230 Accumulated depreciation and amortization (2) (579) (567) 687 663 Construction in progress 53 79 Property, plant and equipment, net $ 740 $ 742 (1) As of both March 31, 2019 and December 31, 2018, includes cost of $366 million, related to assets under operating lease (as lessor). As of both March 31, 2019 and December 31, 2018, includes cost of $23 million related to right-of-use ( “ROU”) assets under finance lease (as lessee). (2) As of March 31, 2019 and December 31, 2018, includes accumulated depreciation of $124 million and $121 million, respectively, related to assets under operating lease (as lessor). As of both March 31, 2019 and December 31, 2018, includes accumulated amortization of $5 million, related to ROU assets under finance lease (as lessee). |
Accrued Liabilities - Third P_2
Accrued Liabilities - Third Parties (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Liabilities | Accrued liabilities – third parties consist of the following as of the dates indicated: March 31, 2019 December 31, 2018 Project accruals $ 5 $ 7 Property taxes 5 4 Other accrued liabilities 2 2 Total accrued liabilities – third parties $ 12 $ 13 |
Related Party Debt (Tables)
Related Party Debt (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of Consolidated Related Party Debt Obligations | Consolidated related party debt obligations comprise the following as of the dates indicated: March 31, 2019 December 31, 2018 Outstanding Balance Total Capacity Available Capacity Outstanding Balance Total Capacity Available Capacity Seven Year Fixed Facility $ 600 $ 600 $ — $ 600 $ 600 $ — Five Year Revolver due July 2023 494 760 266 494 760 266 Five Year Revolver due December 2022 400 1,000 600 400 1,000 600 Five Year Fixed Facility 600 600 — 600 600 — Zydeco Revolver — 30 30 — 30 30 Unamortized debt issuance costs (3) n/a n/a (3) n/a n/a Debt payable – related party $ 2,091 $ 2,990 $ 896 $ 2,091 $ 2,990 $ 896 |
(Tables)
(Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Leases [Abstract] | |
Assets And Liabilities, Lessee | The following tables summarize our lease costs as of and for the three months ended March 31, 2019: Leases Classification March 31, 2019 Assets Operating lease assets Operating lease right-of-use assets $ 5 Finance lease assets Property, plant and equipment, net (1) 18 Total lease assets $ 23 Liabilities Current Finance Accrued liabilities - third parties $ 1 Noncurrent Operating Operating lease liabilities 5 Finance Finance lease liabilities 25 Total lease liabilities $ 31 (1) Finance lease assets are recorded net of accumulated amortization of $5 million as of March 31, 2019. |
Lease, Cost | Three Months Ended Lease cost Classification March 31, 2019 Operating lease cost (1) Operations and maintenance - third parties $ — Finance lease cost (cost resulting from lease payments): Amortization of leased assets (1) Depreciation and amortization — Interest on lease liabilities Interest expense, net 1 Total lease cost $ 1 (1) Amounts for the three months ended March 31, 2019 were less than $1 million. |
Supplemental Cash Flows, Lessee | March 31, 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases (1) $ — Operating cash flows from finance leases (1) — Financing cash flows from finance leases (1) — Weighted-average remaining lease term (years) Operating leases 20 Finance leases 12 Weighted-average discount rate Operating leases 5.8 % Finance leases 14.3 % (1) Amounts for the three months ended March 31, 2019 were less than $1 million. |
Lessee, Operating Lease, Liability, Maturity | The future annual maturity of lease payments as of March 31, 2019 for the above lease obligations were: Maturity of lease liabilities Operating leases (1) Finance leases ( 2 ) Total 2019 $ — $ 3 $ 3 2020 — 4 4 2021 1 4 5 2022 — 4 4 2023 1 4 5 Remainder 6 37 43 Total lease payments 8 56 64 Less: Interest ( 3 ) (3) (30) (33) Present value of lease liabilities ( 4 ) $ 5 $ 26 $ 31 (1) Operating lease payments include $2 million related to options to extend lease terms that are reasonably certain of being exercised. ( 2 ) Includes $26 million in principal and excludes $9 million in executory costs. ( 3 ) Calculated using the interest rate for each lease. ( 4 ) Includes the current portion of $1 million for the finance lease. |
Finance Lease, Liability, Maturity | The future annual maturity of lease payments as of March 31, 2019 for the above lease obligations were: Maturity of lease liabilities Operating leases (1) Finance leases ( 2 ) Total 2019 $ — $ 3 $ 3 2020 — 4 4 2021 1 4 5 2022 — 4 4 2023 1 4 5 Remainder 6 37 43 Total lease payments 8 56 64 Less: Interest ( 3 ) (3) (30) (33) Present value of lease liabilities ( 4 ) $ 5 $ 26 $ 31 (1) Operating lease payments include $2 million related to options to extend lease terms that are reasonably certain of being exercised. ( 2 ) Includes $26 million in principal and excludes $9 million in executory costs. ( 3 ) Calculated using the interest rate for each lease. ( 4 ) Includes the current portion of $1 million for the finance lease. |
Lessor, Operating Lease, Payments to be Received, Maturity | As of March 31, 2019, future annual maturity of lease payments to be received under the contract terms of these operating leases, which includes only the lease components of these leases, were estimated to be: Maturity of lease liabilities Operating leases (1) 2019 $ 42 2020 56 2021 56 2022 56 2023 56 Remainder 750 Total lease payments $ 1,016 (1) Operating lease payments include $555 million related to options to extend lease terms that are reasonably certain of being exercised. |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | The following table provides information about disaggregated revenue by service type and customer type: Three Months Ended March 31, 2019 2018 Transportation services revenue – third parties $ 40 $ 32 Transportation services revenue – related parties (1) 50 31 Storage services revenue – third parties 2 3 Storage services revenue – related parties 2 1 Terminaling services revenue – related parties (2) 12 11 Product revenue – third parties (3) 1 — Product revenue – related parties (3) 10 8 Total Topic 606 revenue 117 86 Lease revenue – related parties 14 14 Total revenue $ 131 $ 100 (1) Transportation services revenue - related parties includes $1 million of the non-lease service component in our transportation services contracts for both the three months ended March 31, 2019 and March 31, 2018. (2) Terminaling services revenue - related parties is entirely comprised of the non-lease service component in our terminaling services contracts. (3) Product revenue is comprised of allowance oil sales. |
Operating Lease, Lease Income | As of March 31, 2019, future minimum payments of both the lease and service components to be received under the initial ten Total Less than 1 year Years 2 to 3 Years 4 to 5 More than 5 years Operating leases $ 907 $ 108 $ 215 $ 217 $ 367 |
Contract Balances | The following table provides information about receivables and contract liabilities from contracts with customers: January 1, 2019 March 31, 2019 Receivables from contracts with customers – third parties $ 19 $ 14 Receivables from contracts with customers – related parties 21 22 Deferred revenue – third parties 8 1 Deferred revenue – related party 3 1 Significant changes in the deferred revenue balances with customers during the period are as follows: December 31, 2018 Additions (1) Reductions (2) March 31, 2019 Deferred revenue – third parties $ 8 $ — $ (7) $ 1 Deferred revenue – related party 3 — (2) 1 (1) Contract liability additions resulted from deficiency payments from minimum volume commitment contracts. |
Remaining Performance Obligations | The following table includes revenue expected to be recognized in the future related to performance obligations exceeding one year of their initial terms that are unsatisfied or partially unsatisfied as of March 31, 2019: Total 2019 2020 2021 2022 2023 and beyond Revenue expected to be recognized on multi-year committed shipper transportation contracts in place as of March 31, 2019 (1) $ 517 $ 42 $ 50 $ 50 $ 50 $ 325 Revenue expected to be recognized on other multi-year committed shipper transportation contracts in place as of March 31, 2019 (2) 42 4 5 5 5 23 Revenue expected to be recognized on multi-year storage service contracts in place as of March 31, 2019 3 3 — — — — Revenue expected to be recognized on other multi-year terminaling service contracts in place as of March 31, 2019 (2) 406 35 47 47 47 230 $ 968 $ 84 $ 102 $ 102 $ 102 $ 578 (1) Excludes revenue deferred for deficiency payments. (2) Relates to the non-lease service components of certain of our long-term transportation and terminaling service contracts which are accounted for as operating leases. |
Net Income Per Limited Partne_2
Net Income Per Limited Partner Unit (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Partners' Capital Notes [Abstract] | |
Schedule of Allocation of Net Income Attributable to the Partnership to Arrive at Net Income Per Limited Partner Unit | The following tables show the allocation of net income attributable to the Partnership to arrive at net income per limited partner unit: Three Months Ended March 31, 2019 2018 Net income $ 137 $ 65 Less: Net income attributable to noncontrolling interests 5 1 Net income attributable to the Partnership 132 64 Less: General partner’s distribution declared (1) 26 28 Limited partners’ distribution declared on common units 93 78 Income in excess of / (less than) distributions $ 13 $ (42) |
Schedule of Basic and Diluted Net Income Per Unit | Three Months Ended March 31, 2019 General Partner Limited Partners’ Common Units Total (in millions of dollars, except per unit data) Distributions declared (1) $ 26 $ 93 $ 119 Income in excess of distributions 1 12 13 Net income attributable to the Partnership $ 27 $ 105 $ 132 Weighted average units outstanding: Basic and diluted 223.8 Net income per limited partner unit: Basic and diluted $ 0.47 ( 1 ) This includes the impact of waiving distributions to the holders of IDR’s. See Note 2 - Related Party Transactions for additional information. Three Months Ended March 31, 2018 General Partner Limited Partners’ Common Units Total (in millions of dollars, except per unit data) Distributions declared $ 28 $ 78 $ 106 Distributions in excess of income (1) (41) (42) Net income attributable to the Partnership $ 27 $ 37 $ 64 Weighted average units outstanding: Basic and diluted 209.4 Net income per limited partner unit: Basic and diluted $ 0.18 |
Description of Business and B_4
Description of Business and Basis of Presentation (Details) - segment | 3 Months Ended | ||
Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | |
Description Of Business And Basis Of Presentation [Line Items] | |||
Number of reportable segments | 1 | ||
Pecten Midstream LLC (“Pecten”) | |||
Description Of Business And Basis Of Presentation [Line Items] | |||
SHLX Ownership | 100.00% | ||
Shell’s Retained Ownership | 0.00% | ||
Sand Dollar Pipeline LLC (“Sand Dollar”) | |||
Description Of Business And Basis Of Presentation [Line Items] | |||
SHLX Ownership | 100.00% | ||
Shell’s Retained Ownership | 0.00% | ||
Triton West LLC (“Triton”) | |||
Description Of Business And Basis Of Presentation [Line Items] | |||
SHLX Ownership | 100.00% | ||
Shell’s Retained Ownership | 0.00% | ||
Zydeco Pipeline Company LLC (“Zydeco”) | |||
Description Of Business And Basis Of Presentation [Line Items] | |||
SHLX Ownership | 92.50% | ||
Shell’s Retained Ownership | 7.50% | ||
Amberjack Pipeline Company LLC (“Amberjack”) - Series A | |||
Description Of Business And Basis Of Presentation [Line Items] | |||
SHLX Ownership | 75.00% | 75.00% | |
Shell’s Retained Ownership | 0.00% | ||
Amberjack Pipeline Company LLC (“Amberjack”) - Series B | |||
Description Of Business And Basis Of Presentation [Line Items] | |||
SHLX Ownership | 50.00% | 50.00% | |
Shell’s Retained Ownership | 0.00% | ||
Mars Oil Pipeline Company LLC (“Mars”) | |||
Description Of Business And Basis Of Presentation [Line Items] | |||
SHLX Ownership | 71.50% | 71.50% | |
Shell’s Retained Ownership | 0.00% | ||
Odyssey Pipeline L.L.C. (“Odyssey”) | |||
Description Of Business And Basis Of Presentation [Line Items] | |||
SHLX Ownership | 71.00% | ||
Shell’s Retained Ownership | 0.00% | ||
Bengal Pipeline Company LLC (“Bengal”) | |||
Description Of Business And Basis Of Presentation [Line Items] | |||
SHLX Ownership | 50.00% | 50.00% | |
Shell’s Retained Ownership | 0.00% | ||
Crestwood Permian Basin LLC (“Permian Basin”) | |||
Description Of Business And Basis Of Presentation [Line Items] | |||
SHLX Ownership | 50.00% | 50.00% | |
Shell’s Retained Ownership | 0.00% | ||
LOCAP LLC (“LOCAP”) | |||
Description Of Business And Basis Of Presentation [Line Items] | |||
SHLX Ownership | 41.48% | 41.48% | |
Shell’s Retained Ownership | 0.00% | ||
Poseidon Oil Pipeline Company LLC (“Poseidon”) | |||
Description Of Business And Basis Of Presentation [Line Items] | |||
SHLX Ownership | 36.00% | 36.00% | |
Shell’s Retained Ownership | 0.00% | ||
Explorer Pipeline Company (“Explorer”) | |||
Description Of Business And Basis Of Presentation [Line Items] | |||
SHLX Ownership | 12.62% | ||
Shell’s Retained Ownership | 25.97% | ||
Proteus Oil Pipeline Company, LLC (“Proteus”) | |||
Description Of Business And Basis Of Presentation [Line Items] | |||
SHLX Ownership | 10.00% | 10.00% | |
Shell’s Retained Ownership | 0.00% | ||
Endymion Oil Pipeline Company, LLC (“Endymion”) | |||
Description Of Business And Basis Of Presentation [Line Items] | |||
SHLX Ownership | 10.00% | 10.00% | |
Shell’s Retained Ownership | 0.00% | ||
Colonial Pipeline Company (“Colonial”) | |||
Description Of Business And Basis Of Presentation [Line Items] | |||
SHLX Ownership | 6.00% | ||
Shell’s Retained Ownership | 10.12% | ||
Cleopatra Gas Gathering Company, LLC (“Cleopatra”) | |||
Description Of Business And Basis Of Presentation [Line Items] | |||
SHLX Ownership | 1.00% | ||
Shell’s Retained Ownership | 0.00% |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Details) $ in Millions | Nov. 03, 2014USD ($) | Sep. 30, 2019USD ($) | Jun. 30, 2019USD ($) | Mar. 31, 2019USD ($)term | Mar. 31, 2018USD ($) | Sep. 30, 2018credit_facility | Dec. 31, 2019USD ($) | Dec. 31, 2018 |
Related Party Transaction [Line Items] | ||||||||
Statute of limitations expirations, number of days | 60 days | |||||||
Health and life insurance costs | $ 2 | $ 2 | ||||||
Defined contribution benefit plan costs | 1 | 1 | ||||||
Reimbursement of cost and expenses | 7 | 4 | ||||||
Operations and maintenance – related parties | $ 14 | 13 | ||||||
Transportation Services Operating Leases | ||||||||
Related Party Transaction [Line Items] | ||||||||
Initial term | 10 years | |||||||
Transportation Services Operating Leases, Five Year Terms | ||||||||
Related Party Transaction [Line Items] | ||||||||
Initial term | 10 years | |||||||
Number of additional terms | term | 2 | |||||||
Additional term | 5 years | |||||||
Transportation Services Operating Leases, One Year Terms | ||||||||
Related Party Transaction [Line Items] | ||||||||
Initial term | 10 years | |||||||
Number of additional terms | term | 10 | |||||||
Additional term | 1 year | |||||||
SPLC | ||||||||
Related Party Transaction [Line Items] | ||||||||
General insurance expense | $ 4 | $ 4 | ||||||
Distributions to holders of incentive distribution rights waived | 17 | |||||||
Shell Treasury Center West Inc | ||||||||
Related Party Transaction [Line Items] | ||||||||
Number of revolving credit facilities | credit_facility | 4 | |||||||
Refinery Gas Pipeline | ||||||||
Related Party Transaction [Line Items] | ||||||||
Reimbursement of cost and expenses | $ 0.6 | |||||||
Five Year Revolver | Shell Treasury Center West Inc | ||||||||
Related Party Transaction [Line Items] | ||||||||
Debt instrument term | 5 years | |||||||
Five Year Fixed Facility | Shell Treasury Center West Inc | ||||||||
Related Party Transaction [Line Items] | ||||||||
Debt instrument term | 5 years | |||||||
Shell Pipeline Company L P | ||||||||
Related Party Transaction [Line Items] | ||||||||
Payment of general and administrative fee | $ 11 | |||||||
Odyssey Pipeline L.L.C. (“Odyssey”) | ||||||||
Related Party Transaction [Line Items] | ||||||||
Noncontrolling interest | 29.00% | 29.00% | ||||||
Zydeco Pipeline Company LLC (“Zydeco”) | ||||||||
Related Party Transaction [Line Items] | ||||||||
Noncontrolling interest | 7.50% | 7.50% | ||||||
Scenario, Forecast | SPLC | ||||||||
Related Party Transaction [Line Items] | ||||||||
Distributions to holders of incentive distribution rights waived | $ 16 | $ 17 | $ 50 |
Related Party Transactions - Sc
Related Party Transactions - Schedule of Other Related Party Balances (Details) - USD ($) $ in Millions | Mar. 31, 2019 | Dec. 31, 2018 |
Related Party Transaction [Line Items] | ||
Accounts receivable | $ 29 | $ 29 |
Prepaid expenses | 11 | 15 |
Other assets | 3 | 3 |
Accounts payable | 9 | 9 |
Deferred revenue | 1 | 3 |
Accrued liabilities | 15 | 16 |
Debt payable | 2,091 | 2,091 |
Accrued interest, related parties | 14 | 14 |
Other accrued liabilities, related parties | 1 | 2 |
Unamortized debt issuance costs | 3 | $ 3 |
Affiliated Entity | ||
Related Party Transaction [Line Items] | ||
Unamortized debt issuance costs | $ 3 |
Related Party Transactions - Re
Related Party Transactions - Related Party Revenues (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Related Party Transaction [Line Items] | ||
Lease revenue – related parties | $ 14 | $ 14 |
Related Party Transactions - _2
Related Party Transactions - Schedule of Condensed Combined Statement of Operations (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Related Party Transactions [Abstract] | ||
Operations and maintenance – related parties | $ 14 | $ 13 |
General and administrative – related parties | 11 | 13 |
Allocated operating expenses | 7 | 8 |
Allocated general corporate expenses | 5 | 4 |
Management Agreement fee | 2 | 2 |
Omnibus Agreement fee | $ 3 | $ 2 |
Related Party Transactions - _3
Related Party Transactions - Reimbursements from Our General Partner (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Related Party Transaction [Line Items] | ||
Changes in receivable from Parent | $ 0 | $ 4 |
Reimbursement of cost and expenses | 7 | 4 |
Contributions from Parent | 7 | 5 |
Shell Pipeline Company L P | ||
Related Party Transaction [Line Items] | ||
Cash received | 7 | 1 |
Changes in receivable from Parent | 0 | 3 |
Total reimbursements | $ 7 | 4 |
Contributions from Parent | $ 1 |
Equity Method Investments - Sch
Equity Method Investments - Schedule of Equity Investments in Affiliates (Details) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 | Mar. 31, 2018 |
Schedule of Equity Method Investments [Line Items] | |||
Investment Amount | $ 814,000,000 | $ 823,000,000 | |
Amberjack – Series A / Series B | |||
Schedule of Equity Method Investments [Line Items] | |||
Investment Amount | $ 444,000,000 | $ 458,000,000 | |
Amberjack - Series A | |||
Schedule of Equity Method Investments [Line Items] | |||
Ownership | 75.00% | 75.00% | |
Amberjack - Series B | |||
Schedule of Equity Method Investments [Line Items] | |||
Ownership | 50.00% | 50.00% | |
Mars | |||
Schedule of Equity Method Investments [Line Items] | |||
Ownership | 71.50% | 71.50% | |
Investment Amount | $ 167,000,000 | $ 169,000,000 | |
Bengal | |||
Schedule of Equity Method Investments [Line Items] | |||
Ownership | 50.00% | 50.00% | |
Investment Amount | $ 84,000,000 | $ 82,000,000 | |
Crestwood Permian Basin LLC (“Permian Basin”) | |||
Schedule of Equity Method Investments [Line Items] | |||
Ownership | 50.00% | 50.00% | |
Investment Amount | $ 76,000,000 | $ 72,000,000 | |
LOCAP | |||
Schedule of Equity Method Investments [Line Items] | |||
Ownership | 41.48% | 41.48% | |
Investment Amount | $ 9,000,000 | $ 8,000,000 | |
Poseidon | |||
Schedule of Equity Method Investments [Line Items] | |||
Ownership | 36.00% | 36.00% | |
Investment Amount | $ 0 | $ 0 | $ 0 |
Proteus | |||
Schedule of Equity Method Investments [Line Items] | |||
Ownership | 10.00% | 10.00% | |
Investment Amount | $ 16,000,000 | $ 16,000,000 | |
Endymion | |||
Schedule of Equity Method Investments [Line Items] | |||
Ownership | 10.00% | 10.00% | |
Investment Amount | $ 18,000,000 | $ 18,000,000 |
Equity Method Investments - Add
Equity Method Investments - Additional Information (Details) - USD ($) | 3 Months Ended | ||||
Mar. 31, 2019 | Mar. 31, 2018 | Jan. 01, 2019 | Dec. 31, 2018 | Jan. 01, 2018 | |
Schedule of Equity Method Investments [Line Items] | |||||
Unamortized basis differences included in equity investments | $ 39,000,000 | $ 40,000,000 | |||
Amortization expense (income) | 1,000,000 | $ 1,000,000 | |||
Equity method investments | 814,000,000 | 823,000,000 | |||
Cumulative effect to total (deficit)/equity | $ 9,000,000 | $ 2,000,000 | |||
Permian Basin | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Capital contribution | 5,000,000 | ||||
Accounting Standards Update 2016-01 | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Cumulative effect to total (deficit)/equity | 9,000,000 | 7,000,000 | |||
Poseidon | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Equity method investments | 0 | 0 | $ 0 | ||
Investment, excess distribution | $ 8,000,000 | $ 1,000,000 | |||
Poseidon | Accounting Standards Update 2016-01 | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Cumulative effect to total (deficit)/equity | $ 0 | $ 0 |
Equity Method Investments - S_2
Equity Method Investments - Schedule of Equity Investments in Affiliates Balance Affected (Details) - USD ($) $ in Millions | 3 Months Ended | |||
Mar. 31, 2019 | Mar. 31, 2018 | Jan. 01, 2019 | Jan. 01, 2018 | |
Schedule of Equity Method Investments [Line Items] | ||||
Distributions Received | $ 83 | $ 51 | ||
Income from equity method investments | 70 | 40 | ||
Impact of Change in Accounting Policy | $ (9) | $ (2) | ||
Amberjack | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Distributions Received | 37 | 0 | ||
Income from equity method investments | 32 | 0 | ||
Mars | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Distributions Received | 31 | 32 | ||
Income from equity method investments | 29 | 25 | ||
Bengal | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Distributions Received | 3 | 4 | ||
Income from equity method investments | 5 | 4 | ||
Poseidon | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Distributions Received | 8 | 9 | ||
Income from equity method investments | 0 | 6 | ||
Other | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Distributions Received | 4 | 6 | ||
Income from equity method investments | $ 4 | $ 5 | ||
Accounting Standards Update 2016-01 | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Impact of Change in Accounting Policy | (9) | (7) | ||
Accounting Standards Update 2016-01 | Amberjack | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Impact of Change in Accounting Policy | (9) | 0 | ||
Accounting Standards Update 2016-01 | Mars | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Impact of Change in Accounting Policy | 0 | (7) | ||
Accounting Standards Update 2016-01 | Bengal | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Impact of Change in Accounting Policy | 0 | 0 | ||
Accounting Standards Update 2016-01 | Poseidon | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Impact of Change in Accounting Policy | 0 | 0 | ||
Accounting Standards Update 2016-01 | Other | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Impact of Change in Accounting Policy | $ 0 | $ 0 |
Equity Method Investments - Sum
Equity Method Investments - Summary of Income Statement Data for Equity Method Investments (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Schedule of Equity Method Investments [Line Items] | ||
Total revenue | $ 131 | $ 100 |
Operating income | 65 | 5 |
Amberjack | ||
Schedule of Equity Method Investments [Line Items] | ||
Total Revenues | 81 | |
Total Operating Expenses | 19 | |
Operating Income | 62 | |
Net Income | 62 | |
Mars | ||
Schedule of Equity Method Investments [Line Items] | ||
Total Revenues | 63 | 57 |
Total Operating Expenses | 22 | 21 |
Operating Income | 41 | 36 |
Net Income | 41 | 36 |
Bengal | ||
Schedule of Equity Method Investments [Line Items] | ||
Total Revenues | 18 | 15 |
Total Operating Expenses | 7 | 4 |
Operating Income | 11 | 11 |
Net Income | 11 | 9 |
Poseidon | ||
Schedule of Equity Method Investments [Line Items] | ||
Total Revenues | 31 | 29 |
Total Operating Expenses | 9 | 9 |
Operating Income | 22 | 20 |
Net Income | 20 | 19 |
Proteus | ||
Schedule of Equity Method Investments [Line Items] | ||
Total Revenues | 30 | 39 |
Total Operating Expenses | 18 | 18 |
Operating Income | 12 | 21 |
Net Income | $ 9 | $ 19 |
Equity (Deficit) (Details)
Equity (Deficit) (Details) - USD ($) | Feb. 06, 2018 | Mar. 02, 2016 | Mar. 31, 2019 | Mar. 31, 2018 | Sep. 30, 2018 | Dec. 31, 2018 |
Class of Stock [Line Items] | ||||||
Aggregate percentage of general partner interest | 2.00% | |||||
Issuance of common units, maximum proceeds | $ 300,000,000 | |||||
Net proceeds from equity offerings | $ 973,000,000 | |||||
Contribution from general partner for additional shares issued | $ 14,000,000 | |||||
Net proceeds from equity offerings | $ 0 | 973,000,000 | ||||
Consideration for units issued to our general partner | $ 0 | 20,000,000 | ||||
Common unitholders' capital account, units outstanding (in shares) | 223,811,781 | |||||
Ownership interest percentage | 43.80% | |||||
Five Year Fixed Facility | ||||||
Class of Stock [Line Items] | ||||||
Repayments of debt | $ 247,000,000 | |||||
Debt instrument term | 5 years | |||||
Five Year Revolver due December 2022 | ||||||
Class of Stock [Line Items] | ||||||
Repayments of debt | $ 726,000,000 | |||||
Debt instrument term | 5 years | |||||
General Partner | ||||||
Class of Stock [Line Items] | ||||||
Aggregate percentage of general partner interest | 2.00% | |||||
Units issued in connection with public offering (in shares) | 510,204 | |||||
Units issued under the ATM Program (in shares) | 225,091 | |||||
Capital units, publicly owned (in shares) | 4,567,588 | |||||
Common Units | ||||||
Class of Stock [Line Items] | ||||||
Common units per share (in USD per share) | $ 27.20 | |||||
Units issued under the ATM Program (in shares) | 11,029,412 | |||||
Net proceeds from equity offerings | $ 300,000,000 | |||||
Consideration for units issued to our general partner | $ 6,000,000 | |||||
Shell Pipeline Company L P | General Partner | ||||||
Class of Stock [Line Items] | ||||||
Aggregate percentage of general partner interest | 2.00% | 2.00% | ||||
Shell Pipeline Company L P | Limited Partner | ||||||
Class of Stock [Line Items] | ||||||
Aggregate percentage of general partner interest | 98.00% | |||||
Shell Pipeline Company L P | Common Units | ||||||
Class of Stock [Line Items] | ||||||
Common unitholders' capital account, units outstanding (in shares) | 99,979,548 | 99,979,548 | ||||
General Public | Common Units | ||||||
Class of Stock [Line Items] | ||||||
Units issued in connection with public offering (in shares) | 25,000,000 | |||||
Net proceeds from equity offerings | $ 673,000,000 | |||||
Gross proceeds from public offering | $ 680,000,000 | |||||
Common units per share (in USD per share) | $ 27.20 | |||||
Underwriter fees | $ 6,000,000 | |||||
Transaction fees | $ 1,000,000 | |||||
Common unitholders' capital account, units outstanding (in shares) | 123,832,233 | 123,832,233 | ||||
Capital units, publicly owned (in shares) | 123,832,233 | |||||
Zydeco | ||||||
Class of Stock [Line Items] | ||||||
Distributions to noncontrolling interest | $ 1,000,000 | 0 | ||||
Odyssey | ||||||
Class of Stock [Line Items] | ||||||
Distributions to noncontrolling interest | $ 2,000,000 | $ 2,000,000 |
Equity (Deficit) - Schedule of
Equity (Deficit) - Schedule of Number of Units Outstanding (Details) | Feb. 06, 2018shares |
General Partner | |
Increase (Decrease) in Partners' Capital [Roll Forward] | |
Units issued in connection with equity offerings (in shares) | 510,204 |
General Public | Common Units | |
Increase (Decrease) in Partners' Capital [Roll Forward] | |
Units issued in connection with equity offerings (in shares) | 25,000,000 |
Equity (Deficit) - Schedule o_2
Equity (Deficit) - Schedule of Distributions Declared and/or Paid (Details) - USD ($) $ / shares in Units, $ in Millions | Feb. 06, 2018 | Mar. 31, 2019 | Dec. 31, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2018 |
Distribution Made To Limited Partner [Line Items] | |||||||
Aggregate percentage of general partner interest | 2.00% | ||||||
Distributions declared and/or paid | $ 119 | $ 129 | $ 113 | $ 106 | $ 83 | $ 121 | |
Distributions paid per limited partner unit (in dollars per share) | $ 0.415 | $ 0.40000 | $ 0.36500 | $ 0.348 | $ 0.33300 | $ 0.38200 | |
Common Units | General Public | |||||||
Distribution Made To Limited Partner [Line Items] | |||||||
Distributions declared and/or paid | $ 51 | $ 49 | $ 45 | $ 43 | $ 33 | $ 47 | |
Common Units | Shell Pipeline Company L P | |||||||
Distribution Made To Limited Partner [Line Items] | |||||||
Distributions declared and/or paid | $ 42 | 40 | 36 | 35 | 30 | 38 | |
General Partner | |||||||
Distribution Made To Limited Partner [Line Items] | |||||||
Aggregate percentage of general partner interest | 2.00% | ||||||
Distributions declared and/or paid | $ 3 | 3 | 2 | 2 | 2 | 3 | |
General Partner | Shell Pipeline Company L P | |||||||
Distribution Made To Limited Partner [Line Items] | |||||||
Aggregate percentage of general partner interest | 2.00% | 2.00% | |||||
General Partner | IDR's | |||||||
Distribution Made To Limited Partner [Line Items] | |||||||
Distributions declared and/or paid | $ 23 | $ 37 | $ 30 | $ 26 | $ 18 | $ 33 |
Property, Plant and Equipment -
Property, Plant and Equipment - Components of Property, Plant and Equipment (Details) - USD ($) $ in Millions | 3 Months Ended | |||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | Sep. 30, 2018 | |
Property Plant And Equipment [Line Items] | ||||
Land | $ 12 | $ 11 | ||
Building and improvements | 40 | 39 | ||
Pipeline and equipment | 1,196 | 1,162 | ||
Other | 18 | 18 | ||
Property, plant and equipment, gross | 1,266 | 1,230 | ||
Accumulated depreciation and amortization | (579) | (567) | ||
Property plant and equipment excluding construction in progress | 687 | 663 | ||
Construction in progress | 53 | 79 | ||
Property, plant and equipment, net | 740 | 742 | ||
Operating leased assets, cost | 366 | |||
Costs related to assets under capital lease | 23 | 22.8 | ||
Accumulated depreciation on assets under operating lease | 124 | $ 121 | ||
Accumulated depreciation on assets under capital lease | $ 5 | |||
Depreciation and amortization expense | $ 12 | $ 11 | ||
Building and Improvements | Minimum | ||||
Property Plant And Equipment [Line Items] | ||||
Property, plant and equipment, depreciable life | 10 years | |||
Building and Improvements | Maximum | ||||
Property Plant And Equipment [Line Items] | ||||
Property, plant and equipment, depreciable life | 40 years | |||
Pipeline and Equipment | Minimum | ||||
Property Plant And Equipment [Line Items] | ||||
Property, plant and equipment, depreciable life | 10 years | |||
Pipeline and Equipment | Maximum | ||||
Property Plant And Equipment [Line Items] | ||||
Property, plant and equipment, depreciable life | 30 years | |||
Other | Minimum | ||||
Property Plant And Equipment [Line Items] | ||||
Property, plant and equipment, depreciable life | 5 years | |||
Other | Maximum | ||||
Property Plant And Equipment [Line Items] | ||||
Property, plant and equipment, depreciable life | 25 years |
Accrued Liabilities - Third P_3
Accrued Liabilities - Third Parties - Schedule of Accrued Liabilities (Details) - USD ($) $ in Millions | Mar. 31, 2019 | Dec. 31, 2018 |
Payables and Accruals [Abstract] | ||
Project accruals | $ 5 | $ 7 |
Property taxes | 5 | 4 |
Other accrued liabilities | 2 | 2 |
Total accrued liabilities – third parties | $ 12 | $ 13 |
Related Party Debt - Schedule o
Related Party Debt - Schedule of Consolidated Related Party Debt Obligations (Details) - USD ($) $ in Millions | Nov. 03, 2014 | Mar. 31, 2018 | Mar. 31, 2019 | Dec. 31, 2018 |
Line Of Credit Facility [Line Items] | ||||
Outstanding Balance | $ 2,091 | $ 2,091 | ||
Unamortized debt issuance costs | (3) | (3) | ||
Total Capacity | 2,990 | 2,990 | ||
Available Capacity | 896 | 896 | ||
Seven Year Fixed Facility | ||||
Line Of Credit Facility [Line Items] | ||||
Outstanding Balance | 600 | 600 | ||
Total Capacity | 600 | 600 | ||
Available Capacity | 0 | 0 | ||
Five Year Revolver due July 2023 | ||||
Line Of Credit Facility [Line Items] | ||||
Outstanding Balance | 494 | 494 | ||
Total Capacity | 760 | 760 | ||
Available Capacity | 266 | 266 | ||
Five Year Revolver due December 2022 | ||||
Line Of Credit Facility [Line Items] | ||||
Debt instrument term | 5 years | |||
Five Year Fixed Facility | ||||
Line Of Credit Facility [Line Items] | ||||
Debt instrument term | 5 years | |||
Outstanding Balance | 600 | 600 | ||
Total Capacity | 600 | 600 | ||
Available Capacity | 0 | 0 | ||
Zydeco Revolver | ||||
Line Of Credit Facility [Line Items] | ||||
Outstanding Balance | 0 | 0 | ||
Total Capacity | 30 | 30 | ||
Available Capacity | 30 | 30 | ||
Five Year Revolver due December 2022 | ||||
Line Of Credit Facility [Line Items] | ||||
Debt instrument term | 5 years | |||
Outstanding Balance | 400 | 400 | ||
Total Capacity | 1,000 | 1,000 | ||
Available Capacity | $ 600 | $ 600 |
Related Party Debt - Additional
Related Party Debt - Additional Information (Details) - USD ($) $ in Millions | Jul. 31, 2018 | Feb. 06, 2018 | Mar. 01, 2017 | Nov. 03, 2014 | Mar. 31, 2019 | Mar. 31, 2018 | Sep. 30, 2018 | Dec. 31, 2018 |
Line Of Credit Facility [Line Items] | ||||||||
Interest and fee expenses | $ 20 | $ 10 | ||||||
Interest paid | 20 | 11 | ||||||
Borrowing capacity | 2,990 | $ 2,990 | ||||||
Repayments of debt | 0 | $ 973 | ||||||
Level 2 | ||||||||
Line Of Credit Facility [Line Items] | ||||||||
Long-term debt, carrying value | 2,094 | 2,094 | ||||||
Long-term debt, fair value | 2,131 | 2,099 | ||||||
Five Year Fixed Facility | ||||||||
Line Of Credit Facility [Line Items] | ||||||||
Debt instrument term | 5 years | |||||||
Five Year Revolver due December 2022 | ||||||||
Line Of Credit Facility [Line Items] | ||||||||
Borrowing capacity | 1,000 | 1,000 | ||||||
Debt instrument term | 5 years | |||||||
Repayments of debt | $ 726 | |||||||
Five Year Fixed Facility | ||||||||
Line Of Credit Facility [Line Items] | ||||||||
Borrowing capacity | $ 600 | $ 600 | ||||||
Debt instrument term | 5 years | |||||||
Repayments of debt | $ 247 | |||||||
Seven Year Fixed Facility | Shell Treasury Center West Inc | Fixed Facility | STCW | ||||||||
Line Of Credit Facility [Line Items] | ||||||||
Debt instrument term | 7 years | |||||||
Five Year Fixed Facility | Shell Treasury Center West Inc | ||||||||
Line Of Credit Facility [Line Items] | ||||||||
Debt instrument term | 5 years | |||||||
Five Year Fixed Facility | Shell Treasury Center West Inc | Fixed Facility | ||||||||
Line Of Credit Facility [Line Items] | ||||||||
Debt instrument term | 5 years |
Additional Information (Details
Additional Information (Details) $ in Millions | Mar. 31, 2019USD ($)renewal_option | Jan. 01, 2019USD ($) | Dec. 31, 2018USD ($) |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Operating lease right-of-use assets | $ 5 | $ 0 | |
Operating lease liability | $ 5 | ||
Accounting Standards Update 2016-02 | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Operating lease right-of-use assets | $ 5 | ||
Operating lease liability | $ 5 | ||
Ten Year Agreement, Five Year Renewal Option | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Initial term | 10 years | ||
Additional term | 5 years | ||
Number of options to extend | renewal_option | 2 | ||
Ten Year Agreement, One Year Renewal Option | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Initial term | 10 years | ||
Additional term | 1 year | ||
Number of options to extend | renewal_option | 10 |
Assets and Liabilities (Details
Assets and Liabilities (Details) - USD ($) $ in Millions | Mar. 31, 2019 | Dec. 31, 2018 |
Leases [Abstract] | ||
Operating lease right-of-use assets | $ 5 | $ 0 |
Finance lease assets | 18 | |
Total lease assets | 23 | |
Current finance lease liabilities | 1 | |
Noncurrent operating liabilities | 5 | 0 |
Noncurrent finance lease liabilities | 25 | $ 25 |
Total lease liabilities | 31 | |
Finance lease, right-of-use asset, accumulated amortization | $ 5 |
Lease Cost (Details)
Lease Cost (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Leases [Abstract] | |
Operating lease cost | $ 0 |
Finance lease cost, amortization of leased assets | 0 |
Finance lease cost, interest on lease liabilities | 1 |
Total lease cost | $ 1 |
Supplemental Cash Flows (Detail
Supplemental Cash Flows (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Leases [Abstract] | |
Operating cash flows from operating leases | $ 0 |
Operating cash flows from finance leases | 0 |
Financing cash flows from finance leases | $ 0 |
Weighted-average remaining lease term - operating leases | 20 years |
Weighted-average remaining lease term - finance leases | 12 years |
Weighted-average discount rate - operating leases | 5.80% |
Weighted-average discount rate - finance leases | 14.30% |
Maturities of Operating and Fin
Maturities of Operating and Financing Lease Liabilities (Details) $ in Millions | Mar. 31, 2019USD ($) |
Operating Lease Liabilities, Payments Due [Abstract] | |
2019 | $ 0 |
2020 | 0 |
2021 | 1 |
2022 | 0 |
2023 | 1 |
Remainder | 6 |
Total lease payments | 8 |
Less: Interest | (3) |
Present value of lease liabilities | 5 |
Operating lease, payments due, related to options to extend | 2 |
Finance Lease Liabilities, Payments, Due [Abstract] | |
2019 | 3 |
2020 | 4 |
2021 | 4 |
2022 | 4 |
2023 | 4 |
Remainder | 37 |
Total lease payments | 56 |
Less: Interest | (30) |
Present value of lease liabilities | 26 |
Finance lease, liability, payments due, principal amount | 26 |
Finance lease, liability, payments due, executory costs | 9 |
Current finance lease liabilities | 1 |
Operating And Finance Lease, Liabilities, Payments Due [Abstract] | |
2019 | 3 |
2020 | 4 |
2021 | 5 |
2022 | 4 |
2023 | 5 |
Remainder | 43 |
Total lease payments | 64 |
Less: Interest | (33) |
Present value of lease liabilities | $ 31 |
Maturity of Lease Payments to b
Maturity of Lease Payments to be Received (Details) $ in Millions | Mar. 31, 2019USD ($) |
Leases [Abstract] | |
2019 | $ 42 |
2020 | 56 |
2021 | 56 |
2022 | 56 |
2023 | 56 |
Remainder | 750 |
Total lease payments | 1,016 |
Operating lease, payments to be received, related to options to extend | $ 555 |
Revenue Recognition - Disaggreg
Revenue Recognition - Disaggregated Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Disaggregation of Revenue [Line Items] | ||
Total Topic 606 revenue | $ 117 | $ 86 |
Lease revenue | 14 | 14 |
Total revenue | 131 | 100 |
Transportation Services | Third Parties | ||
Disaggregation of Revenue [Line Items] | ||
Total Topic 606 revenue | 40 | 32 |
Transportation Services | Related Parties | ||
Disaggregation of Revenue [Line Items] | ||
Total Topic 606 revenue | 50 | 31 |
Storage Services | Third Parties | ||
Disaggregation of Revenue [Line Items] | ||
Total Topic 606 revenue | 2 | 3 |
Storage Services | Related Parties | ||
Disaggregation of Revenue [Line Items] | ||
Total Topic 606 revenue | 2 | 1 |
Terminaling Services | Related Parties | ||
Disaggregation of Revenue [Line Items] | ||
Total Topic 606 revenue | 12 | 11 |
Product Revenue | Third Parties | ||
Disaggregation of Revenue [Line Items] | ||
Total Topic 606 revenue | 1 | 0 |
Product Revenue | Related Parties | ||
Disaggregation of Revenue [Line Items] | ||
Total Topic 606 revenue | 10 | $ 8 |
Transportation Services, Non-lease Service | Related Parties | ||
Disaggregation of Revenue [Line Items] | ||
Total Topic 606 revenue | $ 1 |
Revenue Recognition - Impact of
Revenue Recognition - Impact of Adoption (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||
Revenue from contract with customer | $ 117 | $ 86 | |
Lease revenue – related parties | 14 | 14 | |
Cost of product sold – third parties | 1 | 0 | |
Cost of product sold – related parties | 8 | 7 | |
Operations and maintenance – third parties | 13 | 43 | |
Operations and maintenance – related parties | 14 | 13 | |
Net income | 137 | 65 | |
Deferred revenue – related party | 1 | $ 3 | |
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest | 137 | 65 | |
Third Parties | Transportation, Terminaling and Storage Services | |||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||
Revenue from contract with customer | 42 | 35 | |
Third Parties | Product Revenue | |||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||
Revenue from contract with customer | 1 | 0 | |
Related Parties | Transportation, Terminaling and Storage Services | |||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||
Revenue from contract with customer | 64 | 43 | |
Related Parties | Product Revenue | |||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||
Revenue from contract with customer | $ 10 | $ 8 |
Revenue Recognition - Receivabl
Revenue Recognition - Receivables and Contract Liabilities (Details) $ in Millions | 3 Months Ended | ||
Mar. 31, 2019USD ($)term | Jan. 01, 2019USD ($) | Dec. 31, 2018USD ($) | |
Disaggregation of Revenue [Line Items] | |||
Receivables from contracts with customers | $ 14 | $ 19 | |
Deferred revenue | 1 | $ 8 | 8 |
Total | 907 | ||
Less than 1 year | 108 | ||
Years 2 to 3 | 215 | ||
Years 4 to 5 | 217 | ||
More than 5 years | 367 | ||
Related Parties | |||
Disaggregation of Revenue [Line Items] | |||
Receivables from contracts with customers | 22 | 21 | |
Deferred revenue | 1 | 3 | 3 |
Third Parties | |||
Disaggregation of Revenue [Line Items] | |||
Receivables from contracts with customers | 14 | $ 19 | |
Deferred revenue | $ 1 | $ 8 | |
Transportation Services Operating Leases, Five Year Terms | |||
Disaggregation of Revenue [Line Items] | |||
Initial term | 10 years | ||
Number of additional terms | term | 2 | ||
Additional term | 5 years | ||
Transportation Services Operating Leases, One Year Terms | |||
Disaggregation of Revenue [Line Items] | |||
Initial term | 10 years | ||
Number of additional terms | term | 10 | ||
Additional term | 1 year | ||
Transportation Services Operating Leases | |||
Disaggregation of Revenue [Line Items] | |||
Initial term | 10 years |
Revenue Recognition - Contract
Revenue Recognition - Contract Balances (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Movement in Deferred Revenue [Roll Forward] | |
Deferred revenue, beginning balance | $ 8 |
Deferred revenue, ending balance | 1 |
Third Parties | |
Movement in Deferred Revenue [Roll Forward] | |
Deferred revenue, beginning balance | 8 |
Additions | 0 |
Reductions | (7) |
Deferred revenue, ending balance | 1 |
Related Parties | |
Movement in Deferred Revenue [Roll Forward] | |
Deferred revenue, beginning balance | 3 |
Additions | 0 |
Reductions | (2) |
Deferred revenue, ending balance | $ 1 |
Revenue Recognition - Remaining
Revenue Recognition - Remaining Performance Obligations (Details) $ in Millions | Mar. 31, 2019USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2018-04-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation | $ 84 |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 6 months |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation | $ 102 |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation | $ 102 |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation | $ 102 |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation | $ 578 |
Revenue, remaining performance obligation, expected timing of satisfaction, period | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: (nil) | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation | $ 968 |
Revenue expected to be recognized on multi-year committed shipper transportation contracts in place as of June 30, 2018 | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2018-04-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation | 42 |
Revenue expected to be recognized on multi-year committed shipper transportation contracts in place as of June 30, 2018 | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation | 50 |
Revenue expected to be recognized on multi-year committed shipper transportation contracts in place as of June 30, 2018 | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation | 50 |
Revenue expected to be recognized on multi-year committed shipper transportation contracts in place as of June 30, 2018 | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation | 50 |
Revenue expected to be recognized on multi-year committed shipper transportation contracts in place as of June 30, 2018 | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation | 325 |
Revenue expected to be recognized on multi-year committed shipper transportation contracts in place as of June 30, 2018 | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: (nil) | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation | 517 |
Revenue expected to be recognized on other multi-year transportation service contracts in place as of June 30, 2018 | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2018-04-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation | 4 |
Revenue expected to be recognized on other multi-year transportation service contracts in place as of June 30, 2018 | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation | 5 |
Revenue expected to be recognized on other multi-year transportation service contracts in place as of June 30, 2018 | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation | 5 |
Revenue expected to be recognized on other multi-year transportation service contracts in place as of June 30, 2018 | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation | 5 |
Revenue expected to be recognized on other multi-year transportation service contracts in place as of June 30, 2018 | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation | 23 |
Revenue expected to be recognized on other multi-year transportation service contracts in place as of June 30, 2018 | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: (nil) | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation | 42 |
Revenue expected to be recognized on multi-year storage service contracts in place as of June 30, 2018 | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2018-04-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation | 3 |
Revenue expected to be recognized on multi-year storage service contracts in place as of June 30, 2018 | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation | 0 |
Revenue expected to be recognized on multi-year storage service contracts in place as of June 30, 2018 | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation | 0 |
Revenue expected to be recognized on multi-year storage service contracts in place as of June 30, 2018 | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation | 0 |
Revenue expected to be recognized on multi-year storage service contracts in place as of June 30, 2018 | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation | 0 |
Revenue expected to be recognized on multi-year storage service contracts in place as of June 30, 2018 | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: (nil) | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation | 3 |
Revenue expected to be recognized on multi-year terminaling service contracts in place as of June 30, 2018 | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2018-04-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation | 35 |
Revenue expected to be recognized on multi-year terminaling service contracts in place as of June 30, 2018 | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation | 47 |
Revenue expected to be recognized on multi-year terminaling service contracts in place as of June 30, 2018 | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation | 47 |
Revenue expected to be recognized on multi-year terminaling service contracts in place as of June 30, 2018 | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation | 47 |
Revenue expected to be recognized on multi-year terminaling service contracts in place as of June 30, 2018 | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation | 230 |
Revenue expected to be recognized on multi-year terminaling service contracts in place as of June 30, 2018 | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: (nil) | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation | $ 406 |
Net Income Per Limited Partne_3
Net Income Per Limited Partner Unit - Schedule of Allocation of Net Income to Arrive at Net Income Per Limited Partner Unit (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Limited Partners Capital Account [Line Items] | ||
Net income | $ 137 | $ 65 |
Less: Net income attributable to noncontrolling interests | 5 | 1 |
Net income attributable to the Partnership | 132 | 64 |
Distributions declared | 119 | 106 |
Income (less than) / in excess of distributions | 13 | (42) |
General Partner | ||
Limited Partners Capital Account [Line Items] | ||
Net income attributable to the Partnership | 27 | 27 |
Distributions declared | 26 | 28 |
Income (less than) / in excess of distributions | 1 | (1) |
Limited Partners’ Common Units | ||
Limited Partners Capital Account [Line Items] | ||
Net income attributable to the Partnership | 105 | 37 |
Distributions declared | 93 | 78 |
Income (less than) / in excess of distributions | $ 12 | $ (41) |
Net Income Per Limited Partne_4
Net Income Per Limited Partner Unit - Schedule of Basic and Diluted Net Income Per Unit (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Distribution Made To Limited Partner [Line Items] | ||
Distributions declared | $ 119 | $ 106 |
Income (less than) / in excess of distributions | 13 | (42) |
Net income attributable to the Partnership | 132 | 64 |
General Partner | ||
Distribution Made To Limited Partner [Line Items] | ||
Distributions declared | 26 | 28 |
Income (less than) / in excess of distributions | 1 | (1) |
Net income attributable to the Partnership | 27 | 27 |
Limited Partners’ Common Units | ||
Distribution Made To Limited Partner [Line Items] | ||
Distributions declared | 93 | 78 |
Income (less than) / in excess of distributions | 12 | (41) |
Net income attributable to the Partnership | $ 105 | $ 37 |
Weighted average units outstanding (in millions) | ||
Weighted average units outstanding, basic and diluted (in shares) | 223.8 | 209.4 |
Net income per Limited Partner Unit (in dollars) | ||
Net income per Limited Partner unit, basic and diluted (in dollars per share) | $ 0.47 | $ 0.18 |
Commitments and Contingencies (
Commitments and Contingencies (Details) | Jul. 01, 2018 | Sep. 01, 2016 |
Commitments and Contingencies Disclosure [Abstract] | ||
Tariff rate increase | 4.40% | |
Renewal term | 1 year | |
Initial term | 10 years |
Subsequent Events (Details)
Subsequent Events (Details) - $ / shares | Apr. 24, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2018 |
Subsequent Event [Line Items] | |||||||
Distributions paid per limited partner unit (in dollars per share) | $ 0.415 | $ 0.40000 | $ 0.36500 | $ 0.348 | $ 0.33300 | $ 0.38200 | |
Subsequent Event | |||||||
Subsequent Event [Line Items] | |||||||
Distributions paid per limited partner unit (in dollars per share) | $ 0.4150 |
Uncategorized Items - shlx-2019
Label | Element | Value |
Common Units Public [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ (1,000,000) |
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | (4,000,000) |
Shell Pipeline Company LP [Member] | Common Units Public [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | 1,000,000 |
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | (5,000,000) |
Shell Pipeline Company LP [Member] | General Partner [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ (2,000,000) |