Document and Entity Information
Document and Entity Information - Jun. 30, 2015 - shares | Total |
Document and Entity Information | |
Entity Registrant Name | EQT GP Holdings, LP |
Entity Central Index Key | 1,632,933 |
Document Type | 10-Q |
Document Period End Date | Jun. 30, 2015 |
Amendment Flag | false |
Current Fiscal Year End Date | --12-31 |
Entity Current Reporting Status | No |
Entity Filer Category | Non-accelerated Filer |
Entity Common Units, Units Outstanding | 266,165,000 |
Document Fiscal Year Focus | 2,015 |
Document Fiscal Period Focus | Q2 |
Statements of Consolidated Oper
Statements of Consolidated Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | |||||||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | ||||||
Income Statement [Abstract] | |||||||||
Operating revenues | [1],[2] | $ 144,613 | $ 109,327 | $ 299,424 | $ 217,235 | ||||
Operating expenses: | |||||||||
Operating and maintenance | [1],[3] | 17,232 | 13,626 | 31,711 | 26,365 | ||||
Selling, general and administrative | [1],[3] | 14,765 | 12,865 | 30,418 | 25,420 | ||||
Depreciation and amortization | [1] | 12,258 | 10,436 | 24,185 | [4] | 20,433 | [4] | ||
Total operating expenses | [1] | 44,255 | 36,927 | 86,314 | 72,218 | ||||
Operating income | [1] | 100,358 | 72,400 | 213,110 | 145,017 | ||||
Equity income | [1],[5] | 394 | 0 | 394 | [4] | 0 | [4] | ||
Other income | [1] | 1,169 | 559 | 1,883 | 828 | ||||
Interest expense | [1],[6] | 11,640 | 6,629 | 23,097 | 12,284 | ||||
Income before income taxes | [1] | 90,281 | 66,330 | 192,290 | 133,561 | ||||
Income tax expense | [1] | 5,436 | 13,705 | 25,770 | 32,315 | ||||
Net income | [1] | 84,845 | 52,625 | 166,520 | [4],[7] | 101,246 | [4],[7] | ||
Net income attributable to noncontrolling interests | 56,189 | [1] | 27,343 | [1] | 103,929 | 46,085 | [1] | ||
Net income | [1] | 28,656 | 25,282 | 62,591 | 55,161 | ||||
Calculation of limited partners' interest in net income: | |||||||||
Net income attributable to EQT GP Holdings, LP | [1] | 28,656 | $ 25,282 | 62,591 | $ 55,161 | ||||
Less: results attributable to the pre-IPO period | [1] | (8,303) | (42,238) | ||||||
Limited partners' interest in net income | [1] | $ 20,353 | $ 20,353 | ||||||
Net income per limited partner unit - basic (in dollars per unit) | [1] | $ 0.08 | $ 0.08 | ||||||
Weighted average number of common units outstanding- basic and diluted (in dollars per unit) | [1] | 266,167 | 266,167 | ||||||
Cash distributions declared per unit (in dollars per share) | [1],[8] | $ 0.04739 | $ 0.04739 | ||||||
[1] | Financial statements for the six months ended June 30, 2015 and the three and six months ended June 30, 2014 have been retrospectively recast to reflect the inclusion of the Northern West Virginia Marcellus gathering system (NWV Gathering). See Note B. | ||||||||
[2] | Operating revenues included affiliate revenues from EQT Corporation and subsidiaries (collectively, EQT) of $107.7 million and $74.9 million for the three months ended June 30, 2015 and 2014, respectively, and $214.3 million and $147.2 million for the six months ended June 30, 2015 and 2014, respectively. See Note E. | ||||||||
[3] | Operating and maintenance expense included charges from EQT of $9.0 million and $7.6 million for the three months ended June 30, 2015 and 2014, respectively, and $16.6 million and $13.9 million for the six months ended June 30, 2015 and 2014, respectively. Selling, general and administrative expense included charges from EQT of $12.9 million and $10.5 million for the three months ended June 30, 2015 and 2014, respectively, and $25.7 million and $20.4 million for the six months ended June 30, 2015 and 2014, respectively. See Note E. | ||||||||
[4] | Financial statements for the six months ended June 30, 2015 and 2014 have been retrospectively recast to reflect the inclusion of NWV Gathering. See Note B. | ||||||||
[5] | Equity income relates to EQM's interest in Mountain Valley Pipeline, LLC, which is a related party. | ||||||||
[6] | Interest expense included interest on a capital lease with an affiliate of $5.9 million and $5.4 million for the three months ended June 30, 2015 and 2014, respectively, and $11.8 million and $10.3 million for the six months ended June 30, 2015 and 2014, respectively. | ||||||||
[7] | Financial statements for the six months ended June 30, 2015 and 2014 have been retrospectively recast to reflect the inclusion of NWV Gathering. See Note B. | ||||||||
[8] | Represents the cash distributions declared related to the period presented. The initial distribution has been pro-rated for the 47-day period from the date of the closing of EQGP’s IPO on May 15, 2015 to June 30, 2015. See Note I. |
Statements of Consolidated Ope3
Statements of Consolidated Operations (Footnotes) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | ||
Operating and maintenance expense | [1],[2] | $ 17,232 | $ 13,626 | $ 31,711 | $ 26,365 |
Selling, general and administrative expenses | [1],[2] | 14,765 | 12,865 | 30,418 | 25,420 |
Interest expense on capital lease | [1] | 5,900 | 5,400 | 11,800 | 10,300 |
EQT | |||||
Affiliate revenues | [1] | 107,700 | 74,900 | 214,300 | 147,200 |
Operating and maintenance expense | [1] | 9,000 | 7,600 | 16,600 | 13,900 |
Selling, general and administrative expenses | [1] | $ 12,900 | $ 10,500 | $ 25,700 | $ 20,400 |
[1] | Financial statements for the six months ended June 30, 2015 and the three and six months ended June 30, 2014 have been retrospectively recast to reflect the inclusion of the Northern West Virginia Marcellus gathering system (NWV Gathering). See Note B. | ||||
[2] | Operating and maintenance expense included charges from EQT of $9.0 million and $7.6 million for the three months ended June 30, 2015 and 2014, respectively, and $16.6 million and $13.9 million for the six months ended June 30, 2015 and 2014, respectively. Selling, general and administrative expense included charges from EQT of $12.9 million and $10.5 million for the three months ended June 30, 2015 and 2014, respectively, and $25.7 million and $20.4 million for the six months ended June 30, 2015 and 2014, respectively. See Note E. |
Statements of Consolidated Cash
Statements of Consolidated Cash Flows (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |||
Jun. 30, 2015 | Jun. 30, 2014 | |||
Statement of Cash Flows [Abstract] | ||||
Net income | [1],[2],[3] | $ 166,520 | $ 101,246 | |
Adjustments to reconcile net income to net cash provided by operating activities: | ||||
Depreciation and amortization | [1],[3] | 24,185 | 20,433 | |
Deferred income taxes | [1] | (185,456) | (334,479) | |
Equity income | [1],[3],[4] | (394) | 0 | |
Other income | [1] | (1,883) | (828) | |
Non-cash long-term compensation expense | [1] | 888 | 1,805 | |
Changes in other assets and liabilities: | ||||
Accounts receivable | [1] | 2,551 | (3,643) | |
Accounts payable | [1] | 4,639 | 3,514 | |
Due to/from EQT affiliates | [1] | 224,827 | 342,345 | |
Other assets and liabilities | [1] | 3,225 | 4,958 | |
Net cash provided by operating activities | [1] | 239,102 | 135,351 | |
Cash flows from investing activities: | ||||
Capital expenditures | [1] | (208,890) | (131,669) | |
MVP Interest Acquisition | [1] | (45,885) | 0 | |
Acquisitions – net assets from EQT | [1] | (386,791) | (168,198) | |
Purchase of preferred interest in EQT Energy Supply, LLC | [1] | (124,317) | 0 | |
Net cash used in investing activities | [1] | (765,883) | (299,867) | |
Cash flows from financing activities: | ||||
Proceeds from the issuance of EQM common units, net of offering costs | [1] | 696,582 | 902,451 | |
Acquisitions – purchase price in excess of net assets from EQT | [1] | (486,392) | (952,802) | |
Proceeds from short-term loans | [1] | 434,000 | 450,000 | |
Payments of short-term loans | [1] | (122,000) | (122,020) | |
Distributions to noncontrolling interests | [1] | (52,672) | (25,673) | |
Capital contributions | [1] | 213 | 45 | |
Net distributions to EQT | [1] | (107,759) | (131,155) | |
Capital lease principal payments | [1] | (5,472) | (2,216) | |
Net cash provided by financing activities | [1] | 356,500 | 118,630 | |
Net change in cash and cash equivalents | [1] | (170,281) | (45,886) | |
Cash and cash equivalents at beginning of period | [1] | 171,291 | [5] | 247,988 |
Cash and cash equivalents at end of period | [1] | 1,010 | [5] | 202,102 |
Cash paid during the period for: | ||||
Interest paid | [1] | 25,442 | 10,800 | |
Non-cash activity during the period for: | ||||
Increase in capital lease asset/obligation | [1] | 8,235 | 5,178 | |
Elimination of net current and deferred taxes at IPO | [1] | (164,586) | 0 | |
Limited partner and general partner units issued for acquisitions | [1] | 52,500 | 59,000 | |
Net settlement of current income taxes payable with EQT | [1] | $ 380,316 | $ 215,380 | |
[1] | Financial statements for the six months ended June 30, 2015 and 2014 have been retrospectively recast to reflect the inclusion of NWV Gathering. See Note B. | |||
[2] | Financial statements for the six months ended June 30, 2015 and 2014 have been retrospectively recast to reflect the inclusion of NWV Gathering. See Note B. | |||
[3] | Financial statements for the six months ended June 30, 2015 and the three and six months ended June 30, 2014 have been retrospectively recast to reflect the inclusion of the Northern West Virginia Marcellus gathering system (NWV Gathering). See Note B. | |||
[4] | Equity income relates to EQM's interest in Mountain Valley Pipeline, LLC, which is a related party. | |||
[5] | Financial statements as of December 31, 2014 have been retrospectively recast to reflect the inclusion of NWV Gathering. See Note B. |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Jun. 30, 2015 | Dec. 31, 2014 | |
Current assets: | |||
Cash and cash equivalents | [1],[2] | $ 1,010 | $ 171,291 |
Accounts receivable (net of allowance for doubtful accounts of $211 as of June 30, 2015 and $260 as of December 31, 2014) | [1] | 13,941 | 16,492 |
Accounts receivable – affiliate | [1] | 61,511 | 55,068 |
Other current assets | [1] | 1,283 | 1,710 |
Total current assets | [1] | 77,745 | 244,561 |
Property, plant and equipment | [1] | 2,007,248 | 1,821,803 |
Less: accumulated depreciation | [1] | (235,075) | (216,486) |
Net property, plant and equipment | [1] | 1,772,173 | 1,605,317 |
Deferred income taxes, net | [1] | 0 | 258,744 |
Equity in nonconsolidated investments | [1] | 46,279 | 0 |
Other assets | [1] | 141,285 | 18,057 |
Total assets | [1] | 2,037,482 | 2,126,679 |
Current liabilities: | |||
Accounts payable | [1] | 40,537 | 43,785 |
Due to related party | [1] | 35,601 | 409,931 |
Short-term loans | [1] | 312,000 | 0 |
Accrued interest | [1] | 8,519 | 8,338 |
Accrued liabilities | [1] | 6,036 | 9,055 |
Total current liabilities | [1] | 402,693 | 471,109 |
Long-term debt | [1] | 493,017 | 492,633 |
Lease obligation | [1] | 148,831 | 143,828 |
Other long-term liabilities | [1] | 6,017 | 7,111 |
Total liabilities | [1] | 1,050,558 | 1,114,681 |
Equity and partners’ capital: | |||
Common units (266,165,000 issued and outstanding at June 30, 2015) | [1] | (1,355,924) | 0 |
Parent net investment | [1] | 0 | (775,342) |
Total equity and partners’ capital | [1] | (1,355,924) | (775,342) |
Noncontrolling interests | [1] | 2,342,848 | 1,787,340 |
Total equity and partners’ capital | [1],[3] | 986,924 | 1,011,998 |
Total liabilities, equity and partners’ capital | [1] | $ 2,037,482 | $ 2,126,679 |
[1] | Financial statements as of December 31, 2014 have been retrospectively recast to reflect the inclusion of NWV Gathering. See Note B. | ||
[2] | Financial statements for the six months ended June 30, 2015 and 2014 have been retrospectively recast to reflect the inclusion of NWV Gathering. See Note B. | ||
[3] | Financial statements for the six months ended June 30, 2015 and 2014 have been retrospectively recast to reflect the inclusion of NWV Gathering. See Note B. |
Consolidated Balance Sheets (U6
Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2015 | Dec. 31, 2014 |
Statement of Financial Position [Abstract] | ||
Accounts Receivable, for doubtful accounts | $ 211 | $ 260 |
Common units issued | 266,165,000 | |
Common units outstanding | 266,165,000 |
Statements of Consolidated Equi
Statements of Consolidated Equity and Partners' Capital (Unaudited) - USD ($) $ in Thousands | Total | Parent Net Investment | Common Units | Noncontrolling Interests in Consolidated Subsidiaries | ||
Beginning Balance at Dec. 31, 2013 | [1] | $ 1,112,460 | $ 283,793 | $ 828,667 | ||
Increase (Decrease) in Partners' Capital | ||||||
Net Income | [1] | 101,246 | [2],[3] | 55,161 | 46,085 | |
Capital contribution | [1] | 500 | 500 | |||
Equity-based compensation plans | [1] | 1,967 | 1,967 | |||
Distributions to noncontrolling interests | [1] | (25,673) | (25,673) | |||
Issuance of units | [1] | (1,180,000) | (1,180,000) | |||
Net contributions from EQT | [1] | 84,225 | 84,225 | |||
EQM equity transactions | [1],[4] | 961,451 | 59,000 | 902,451 | ||
Ending Balance at Jun. 30, 2014 | [1] | 1,056,176 | (695,354) | $ 0 | 1,751,530 | |
Beginning Balance at Dec. 31, 2014 | [1] | 1,011,998 | [5] | (775,342) | 0 | 1,787,340 |
Increase (Decrease) in Partners' Capital | ||||||
Net Income | [1] | 166,520 | [2],[3] | 42,238 | 20,353 | 103,929 |
Capital contribution | [1] | 1,748 | 1,748 | |||
Equity-based compensation plans | [1] | 914 | 247 | 118 | 549 | |
Distributions to noncontrolling interests | [1] | (52,672) | (52,672) | |||
Issuance of units | [1] | (925,683) | (925,683) | |||
EQM equity transactions | [1],[4] | 749,082 | 52,500 | 696,582 | ||
Net distributions to EQT | [1] | 272,557 | 272,557 | |||
Changes in ownership of EQM, net | [1] | (72,954) | 119,926 | (192,880) | ||
Elimination of net current and deferred tax liabilities | [1] | (164,586) | (164,586) | |||
Elimination of net current and deferred taxes upon IPO | [1] | 1,376,395 | (1,376,395) | |||
Ending Balance at Jun. 30, 2015 | [1] | $ 986,924 | [5] | $ 0 | $ (1,355,924) | $ 2,342,848 |
[1] | Financial statements for the six months ended June 30, 2015 and 2014 have been retrospectively recast to reflect the inclusion of NWV Gathering. See Note B. | |||||
[2] | Financial statements for the six months ended June 30, 2015 and 2014 have been retrospectively recast to reflect the inclusion of NWV Gathering. See Note B. | |||||
[3] | Financial statements for the six months ended June 30, 2015 and the three and six months ended June 30, 2014 have been retrospectively recast to reflect the inclusion of the Northern West Virginia Marcellus gathering system (NWV Gathering). See Note B. | |||||
[4] | Includes the impact of EQM's public equity offerings and units issued in connection with acquisitions from EQT as described in Note B. | |||||
[5] | Financial statements as of December 31, 2014 have been retrospectively recast to reflect the inclusion of NWV Gathering. See Note B. |
Financial Statements
Financial Statements | 6 Months Ended |
Jun. 30, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Financial Statements | Financial Statements Organization On May 15, 2015, EQT GP Holdings, LP (EQGP) completed its initial public offering (IPO). EQGP was formed in January 2015 as a Delaware limited partnership and wholly owned subsidiary of EQT Gathering Holdings, LLC (EQT Gathering Holdings), a Delaware limited liability company and wholly owned subsidiary of EQT Corporation (EQT). EQGP was formed to own EQT's partnership interests in EQT Midstream Partners, LP (EQM), a growth-oriented Delaware limited partnership formed by EQT to own, operate, acquire and develop midstream assets in the Appalachian Basin. EQT Midstream Services, LLC (EQM General Partner) is a wholly owned subsidiary of EQGP and is EQM's general partner. EQT GP Services, LLC (EQGP General Partner) is a wholly owned subsidiary of EQT and is EQGP's general partner. As of June 30, 2015 , EQGP owned the following three types of EQM partnership interests: (i) 21,811,643 EQM common units, representing a 30.2% limited partner interest in EQM, (ii) 1,443,015 EQM general partner units, representing a 2.0% general partner interest in EQM, and (iii) all of EQM's incentive distribution rights (IDRs), which entitle EQGP to receive up to 48.0% of incremental cash distributed by EQM if certain target distribution levels are reached in any quarter. For accounting purposes, the historical financial statements of EQGP for the time periods prior to the completion of the IPO (the Predecessor) include the assets, liabilities and results of operations of EQM General Partner and EQT Midstream Investments, LLC (EQM LP). Prior to the IPO, EQM General Partner and EQM LP were wholly owned subsidiaries of EQT and directly held EQT's partnership interests in EQM. Prior to the closing of the IPO, EQM LP merged with and into EQGP and EQT contributed 100% of the outstanding limited liability company interests in EQM General Partner to EQGP. EQGP and EQM do not have any employees. Administrative support for EQGP is provided by EQT. Operational support for EQM is provided by EQT. Basis of Presentation The accompanying unaudited consolidated financial statements have been prepared in accordance with GAAP for interim financial information and with the requirements of Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, these unaudited consolidated financial statements include all adjustments (consisting of only normal recurring adjustments, unless otherwise disclosed in this Form 10-Q) necessary for a fair presentation of the financial position of EQGP as of June 30, 2015 and December 31, 2014 , the results of its operations for the three and six months ended June 30, 2015 and 2014 and its cash flows and equity and partners' capital for the six months ended June 30, 2015 and 2014 . Certain previously reported amounts have been reclassified to conform to the current year presentation. The balance sheet at December 31, 2014 , has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by GAAP for complete financial statements. EQGP has no independent operations and EQGP's only cash-generating assets consist of its partnership interests in EQM. EQGP’s financial statements differ from those of EQM primarily as a result of: (i) the presentation of noncontrolling interest ownership in EQM attributable to the publicly held limited partner interests in EQM, (ii) general and administrative expenses incurred by EQGP, which are separate from and in addition to those incurred by EQM, and (iii) incremental income tax expense as applicable to the period prior to the EQGP IPO (see Note F). Because EQM General Partner is a wholly owned subsidiary of EQGP and controls EQM through its general partner interest, EQM is consolidated by EQGP. As discussed in Note B, EQGP's financial statements include the historical results of the Jupiter natural gas gathering system (Jupiter), which was acquired by EQM on May 7, 2014, and NWV Gathering, which was acquired by EQM on March 17, 2015. NWV Gathering and Jupiter were businesses and the NWV Gathering Acquisition and Jupiter Acquisition (defined in Note B) were transactions between entities under common control; therefore, EQM recorded the assets and liabilities of NWV Gathering and Jupiter at their carrying amounts to EQT on the date of the respective transactions. The difference between EQT’s net carrying amount and the total consideration paid to EQT was recorded as a capital transaction with EQT, which resulted in a reduction in partners’ capital. EQM recast its consolidated financial statements to retrospectively reflect the NWV Gathering Acquisition and Jupiter Acquisition as if the entities were owned for all periods presented; however, the consolidated financial statements are not necessarily indicative of the results of operations that would have occurred if EQM had owned them during the periods reported. Due to the seasonal nature of EQM’s utility customer contracts, the interim statements for the three and six months ended June 30, 2015 are not necessarily indicative of the results that may be expected for the year ending December 31, 2015 . For further information, refer to the EQGP Predecessor audited financial statements and footnotes thereto for the year ended December 31, 2014 included in EQGP's prospectus dated May 11, 2015 and filed with the SEC on May 12, 2015 pursuant to Rule 424(b)(4) of the Securities Act of 1933, as amended, as well as "Management's Discussion and Analysis of Financial Condition and Results of Operations" contained therein. Recently Issued Accounting Standards In May 2014, the FASB issued Accounting Standards Update (ASU) No. 2014-09, Revenue from Contracts with Customers . The standard requires an entity to recognize revenue in a manner that depicts the transfer of goods or services to customers at an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. ASU No. 2014-09 will replace most of the existing revenue recognition requirements in GAAP when it becomes effective. In July 2015, the FASB approved the deferral of the effective date of this ASU to annual reporting periods beginning after December 15, 2017, with the option to adopt as early as annual reporting periods beginning after December 15, 2016. EQGP is currently evaluating the method of adoption and impact this standard will have on its financial statements and related disclosures. In February 2015, the FASB issued ASU No. 2015-02, Consolidation . The standard changes the analysis that a reporting entity must perform to determine whether it should consolidate certain types of legal entities. The ASU will be effective for annual reporting periods beginning after December 15, 2015, including interim periods therein. EQGP is currently evaluating the impact this standard will have on its financial statements and related disclosures. In April 2015, the FASB issued ASU No. 2015-05, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement . The ASU adds guidance that will help entities evaluate the accounting for fees paid by a customer in a cloud computing arrangement. The ASU will be effective for annual reporting periods beginning after December 15, 2015. EQGP is currently evaluating the impact this standard will have on its financial statements and related disclosures. In April 2015, the FASB issued ASU No. 2015-06, Earnings Per Share (Topic 260): Effects on Historical Earnings per Unit of Master Limited Partnership Dropdown Transactions . The ASU applies to master limited partnerships that receive net assets through a dropdown transaction. EQGP has adopted this standard which had no significant impact on reported results or disclosures. |
Acquisitions
Acquisitions | 6 Months Ended |
Jun. 30, 2015 | |
Business Combinations [Abstract] | |
Acquisitions | Acquisitions NWV Gathering Acquisition On March 10, 2015 , EQM entered into a contribution and sale agreement (Contribution Agreement) pursuant to which, on March 17, 2015, EQT contributed NWV Gathering to EQM Gathering Opco, LLC (EQM Gathering), an indirect wholly owned subsidiary of EQM (the NWV Gathering Acquisition). EQM paid total consideration of approximately $925.7 million to EQT, consisting of approximately $873.2 million in cash, 511,973 EQM common units and 178,816 EQM general partner units. The cash portion of the purchase price was funded with the net proceeds from an equity offering of EQM common units and borrowings under EQM's credit facility. On April 15, 2015 , pursuant to the Contribution Agreement, EQM acquired a preferred interest in EQT Energy Supply, LLC, (the Preferred Interest), an indirect wholly owned subsidiary of EQT that generates revenue from services provided to a local distribution company, from EQT for approximately $124.3 million . EQM accounts for the Preferred Interest as a cost method investment and included it in other assets on the consolidated balance sheets. EQT Energy Supply, LLC has been determined to be a variable interest entity because it has insufficient equity to finance its activities. EQM is not the primary beneficiary because it does not have the power to direct the activities of EQT Energy Supply, LLC that most significantly impact its economic performance. MVP Interest Acquisition On March 30, 2015, EQM assumed 100% of the membership interests in MVP Holdco, LLC (MVP Holdco), an indirect wholly owned subsidiary of EQT that owns an approximately 55% interest (the MVP Interest) in Mountain Valley Pipeline, LLC (MVP Joint Venture) for approximately $54.2 million (MVP Interest Acquisition), which represented EQM's reimbursement to EQT for 100% of the capital contributions made by EQT to the MVP Joint Venture as of March 30, 2015. The MVP Joint Venture plans to construct the Mountain Valley Pipeline (MVP) project, an estimated 300 -mile natural gas interstate pipeline spanning from northern West Virginia to southern Virginia. The MVP project is subject to FERC approval. The voluntary pre-filing process with the FERC began in October 2014 and the pipeline is expected to be in-service during the fourth quarter of 2018. The MVP Joint Venture has been determined to be a variable interest entity because the MVP Joint Venture has insufficient equity to finance activities during the construction stage of the MVP. EQM is not the primary beneficiary because it does not have the power to direct the activities of the MVP Joint Venture that most significantly impact its economic performance. EQM accounted for the MVP Interest beginning on the date it was assumed from EQT as an equity method investment. On March 11, 2015, the MVP Joint Venture announced that WGL Holdings, Inc. and Vega Energy Partners, Ltd. had acquired 7% and 3% ownership interests, respectively, in the MVP Joint Venture. As a result, EQM was reimbursed $8.3 million of capital contributions. Jupiter Acquisition On April 30, 2014, EQM entered into a contribution agreement pursuant to which, on May 7, 2014, EQT contributed to EQM Gathering certain assets constituting the Jupiter natural gas gathering system (Jupiter Acquisition). The aggregate consideration paid by EQM to EQT in connection with the Jupiter Acquisition was approximately $1,180 million , consisting of a $1,121 million cash payment and issuance of 516,050 EQM common units and 262,828 EQM general partner units. The cash portion of the purchase price was funded with the net proceeds from an equity offering of EQM common units and borrowings under EQM’s credit facility. |
Equity and Partners' Capital
Equity and Partners' Capital | 6 Months Ended |
Jun. 30, 2015 | |
Equity [Abstract] | |
Equity and Partners' Capital | Equity and Partners' Capital Holdings of EQGP Equity On May 15, 2015, EQGP completed its IPO of 26,450,000 common units representing limited partner interests. All of the common units sold in the IPO were sold by EQT Gathering Holdings. EQGP did not receive any proceeds from, or incur any expenses in connection with, the completion of the IPO. As the selling unitholder, EQT Gathering Holdings received all proceeds from EQGP's IPO. As of June 30, 2015 , EQT indirectly held 239,715,000 EQGP common units, representing a 90.1% limited partner interest in EQGP, and the entire non-economic general partner interest in EQGP. As of June 30, 2015 , the public held 26,450,000 EQGP common units, representing a 9.9% limited partner interest in EQGP. Net Income Per Limited Partner Unit For EQGP, net income per limited partner unit is calculated by dividing the limited partners' interest in net income by the weighted average number of common units outstanding. Net income attributable to periods prior to the closing of EQGP's IPO is attributable to subsidiaries of EQT and has been excluded from the limited partners' interest in net income. Net income per limited partner unit for the 47 -day period beginning on the date EQGP's IPO closed through June 30, 2015 was calculated based on the number of units outstanding after the IPO. Holdings of EQM Equity As of June 30, 2015 , EQGP and its affiliates held 21,811,643 EQM common units, representing a 30.2% limited partner interest, 1,443,015 EQM general partner units, representing the 2.0% general partner interest, and all of the IDRs in EQM. As of June 30, 2015 , the public held 48,896,063 EQM common units, representing a 67.8% limited partner interest in EQM. The following table summarizes EQM's common, subordinated and general partner units issued January 1, 2014 through June 30, 2015 : EQM Limited Partner Units EQM General Partner Units Common Subordinated Total Balance at January 1, 2014 30,468,902 17,339,718 975,686 48,784,306 May 2014 equity offering 12,362,500 — — 12,362,500 Jupiter Acquisition consideration (see Note B) 516,050 — 262,828 778,878 Balance at December 31, 2014 43,347,452 17,339,718 1,238,514 61,925,684 Conversion of subordinated units to common units 17,339,718 (17,339,718 ) — — 2014 EQM VDA issuance 21,063 — 430 21,493 March 2015 equity offering 9,487,500 — 25,255 9,512,755 NWV Gathering Acquisition consideration (see Note B) 511,973 — 178,816 690,789 Balance at June 30, 2015 70,707,706 — 1,443,015 72,150,721 In connection with EQM's IPO in 2012, EQM issued 17,339,718 subordinated units to EQM LP. The subordination period with respect to all 17,339,718 EQM subordinated units expired on February 17, 2015. As a result, all of the outstanding EQM subordinated units converted into EQM common units on a one -for-one basis on February 17, 2015. In February 2015, EQM issued 21,063 common units under the 2014 EQM Value Driver Award (2014 EQM VDA). As a result, EQT purchased 430 EQM general partner units to maintain its 2.0% general partner interest in EQM. On March 17, 2015 , EQM completed an underwritten public offering of 8,250,000 common units. On March 18, 2015 , the underwriters exercised their option to purchase 1,237,500 additional common units on the same terms as the offering. EQM received net proceeds of approximately $696.6 million after deducting the underwriters' discount and offering expenses which were used to finance a portion of the cash consideration paid to EQT in connection with the NWV Gathering Acquisition. As a result of the sale of the additional common units, EQT purchased 25,255 EQM general partner units for approximately $1.9 million to maintain its 2.0% general partner interest in EQM. In connection with the March 17, 2015 underwritten public offering by EQM, EQGP recorded a $122.8 million gain to parent net investment, a decrease in non-controlling interest of EQM of $195.8 million and an increase to deferred tax liability of $73.0 million . This transaction was classified as non-cash and is not included on the consolidated statement of cash flows for the six months ended June 30, 2015 . |
Financial Information by Busine
Financial Information by Business Segment | 6 Months Ended |
Jun. 30, 2015 | |
Segment Reporting [Abstract] | |
Financial Information by Business Segment | Financial Information by Business Segment EQGP has no independent operations or material assets other than its partnership interests in EQM. As a result, the segment information presented below aligns with the presentation of EQM's operating segments. Operating segments are revenue-producing components of the enterprise for which separate financial information is produced internally and is subject to evaluation by the chief operating decision maker in deciding how to allocate resources. EQM reports its operations in two segments, which reflect its lines of business. Transmission and storage includes EQM’s FERC-regulated interstate pipeline and storage business. Gathering includes EQM's high-pressure gathering lines and FERC-regulated low pressure gathering system. The operating segments are evaluated on their contribution to EQM’s operating income. All of EQM’s operating revenues, income from operations and assets are generated or located in the United States. Three Months Ended Six Months Ended 2015 2014 2015 2014 (Thousands) Revenues from external customers (including affiliates): Transmission and storage $ 68,140 $ 59,125 $ 147,501 $ 118,442 Gathering 76,473 50,202 151,923 98,793 Total $ 144,613 $ 109,327 $ 299,424 $ 217,235 Operating income: Transmission and storage $ 45,917 $ 41,982 $ 103,207 $ 84,019 Gathering 55,479 30,418 110,941 60,998 Headquarters (1,038 ) — (1,038 ) — Total operating income $ 100,358 $ 72,400 $ 213,110 $ 145,017 Reconciliation of operating income to net income: Equity income 394 — 394 — Other income 1,169 559 1,883 828 Interest expense 11,640 6,629 23,097 12,284 Income tax expense 5,436 13,705 25,770 32,315 Net income $ 84,845 $ 52,625 $ 166,520 $ 101,246 June 30, 2015 December 31, 2014 (Thousands) Segment assets: Transmission and storage $ 998,173 $ 928,864 Gathering 863,350 765,090 Total operating segments $ 1,861,523 $ 1,693,954 Headquarters, including cash 175,959 432,725 Total assets $ 2,037,482 $ 2,126,679 Three Months Ended Six Months Ended 2015 2014 2015 2014 (Thousands) Depreciation and amortization: Transmission and storage $ 7,017 $ 6,322 $ 13,785 $ 12,481 Gathering 5,241 4,114 10,400 7,952 Total $ 12,258 $ 10,436 $ 24,185 $ 20,433 Expenditures for segment assets: Transmission and storage $ 58,020 $ 25,080 $ 79,482 $ 39,081 Gathering 69,029 56,406 105,298 90,855 Total (1) $ 127,049 $ 81,486 $ 184,780 $ 129,936 (1) EQM accrues capital expenditures when work has been completed but the associated bills have not yet been paid. These accrued amounts are excluded from capital expenditures on the statements of consolidated cash flows until they are paid in a subsequent period. Accrued capital expenditures were $27.0 million and $14.4 million at June 30, 2015 and 2014 , respectively. Additionally, EQM capitalizes certain labor overhead costs which include a portion of non-cash equity-based compensation. These non-cash capital expenditures in the table above were less than $0.1 million and approximately $0.1 million for the three months ended June 30, 2015 and 2014 , respectively, and less than $0.1 million and approximately $0.2 million for the six months ended June 30, 2015 and 2014 , respectively. |
Related-Party Transactions
Related-Party Transactions | 6 Months Ended |
Jun. 30, 2015 | |
Related Party Transactions [Abstract] | |
Related-Party Transactions | Related-Party Transactions In the ordinary course of business, EQGP and EQM have transactions with affiliated companies. EQM has various contracts with affiliates including, but not limited to, transportation service and precedent agreements, storage agreements and gas gathering agreements. EQGP and EQM have various agreements with EQT. EQGP and EQM each have an omnibus agreement with EQT pursuant to which EQT performs various services for them. These services include, as applicable, centralized corporate, general and administrative services, such as legal, corporate recordkeeping, planning, budgeting, regulatory, accounting, billing, business development, treasury, insurance administration and claims processing, risk management, health, safety and environmental, information technology, human resources, investor relations, cash management and banking, payroll, internal audit, taxes, and engineering. In exchange, EQGP and EQM reimburse EQT for the expenses incurred in providing these services. EQGP and EQM are required to reimburse EQT for the allocable portion of the premiums on any insurance policies covering EQGP or EQM assets. Effective January 1, 2015, EQM amended its omnibus agreement to provide for reimbursement by EQM of direct and indirect costs and expenses attributable to EQT's long-term incentive programs as these plans will be utilized to compensate and retain EQT employees who provide services to EQM. Pursuant to an operation and management services agreement, EQT Gathering, LLC, a wholly owned subsidiary of EQT, provides EQM’s pipelines and storage facilities with certain operational and management services. EQM reimburses EQT Gathering for such services pursuant to the terms of the EQM omnibus agreement. The expenses for which EQGP and EQM reimburse EQT and its subsidiaries may not necessarily reflect the actual expenses that EQGP or EQM would incur on a stand-alone basis and EQGP and EQM are unable to estimate what those expenses would be on a stand-alone basis. See also Note B for a discussion of the MVP Joint Venture and the Preferred Interest in EQT Energy Supply, LLC and see Note G for a discussion of EQGP's Working Capital Loan Agreement with EQT. |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2015 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Predecessor's financial statements for the period prior to EQGP's IPO include U.S. federal and state income tax as its income was included as part of EQT's consolidated return for federal and state income tax purposes. Current federal tax obligations of all subsidiary companies are settled through EQT. The consolidated federal income tax is allocated among the group’s members on a separate return basis with tax credits allocated to the members generating the credits. In connection with the completion of the EQGP IPO and EQGP 's limited partnership structure for U.S. federal and state income tax purposes, approximately $164.6 million of net current and deferred income taxes were eliminated through equity. Subsequent to May 15, 2015, for federal and state income tax purposes, all income, expenses, gains, losses and tax credits generated by EQGP will flow through to EQGP's unitholders, and accordingly, will not result in a provision for income taxes for EQGP. For the period prior to EQGP's IPO, EQGP estimated an annual effective tax rate based on projected results for the year and applied this rate to income before taxes to calculate income tax expense. All of EQM's earnings were included in EQGP's net income. However, EQGP was not required to record income tax expense with respect to the portion of EQM's earnings allocated to its noncontrolling public limited partners, which reduced EQGP's effective tax rate. EQGP's effective income tax rate for the six months ended June 30, 2015 was 13.4% , compared to 24.2% for the six months ended June 30, 2014 . The decrease in the effective tax rate was primarily attributable to the increase in EQM's earnings allocated to the noncontrolling limited partners resulting from EQM's underwritten public offerings of common units in May 2014 and March 2015 in addition to the EQGP IPO on May 15, 2015. |
Short-term Loans
Short-term Loans | 6 Months Ended |
Jun. 30, 2015 | |
Debt Disclosure [Abstract] | |
Short-term Loans | Short-term Loans EQGP Working Capital Facility On May 15, 2015 in connection with the closing of EQGP's IPO, EQGP entered into a Working Capital Loan Agreement with EQT (the Working Capital Facility). The Working Capital Facility provides for interest bearing loans of up to $50 million outstanding at any one time and matures on the earlier of February 18, 2019 or at least 90 days after EQT gives notice of termination. As of June 30, 2015 , EQGP had no loans or letters of credit outstanding under the Working Capital Facility. EQM Credit Facility EQM has a $750 million credit facility that expires in February 2019. The credit facility is available to fund working capital requirements and capital expenditures, to purchase assets, to pay distributions, to repurchase units and for general partnership purposes. As of June 30, 2015 , EQM had $312 million outstanding on the credit facility. There were no amounts outstanding as of December 31, 2014. The maximum amount of EQM’s outstanding short-term loans at any time during the three months ended June 30, 2015 and 2014 was $323 million and $450 million , respectively, and during the six months ended June 30, 2015 and 2014 was $390 million and $450 million , respectively. The average daily balance of short-term loans outstanding was approximately $302 million and $252 million for the three months ended June 30, 2015 and 2014 , respectively, and was approximately $182 million and $173 million for the six months ended June 30, 2015 and 2014 , respectively. Interest was incurred on the loans at a weighted average annual interest rate of 1.69% and 1.66% for the three months ended June 30, 2015 and 2014 , respectively, and 1.69% and 1.68% for the six months ended June 30, 2015 and 2014 , respectively. |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Jun. 30, 2015 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The carrying value of cash and cash equivalents, accounts receivable, amounts due to/from related parties and accounts payable approximate fair value due to the short maturity of the instruments. The carrying value of short-term loans under EQM's credit facility approximates fair value as the interest rates are based on prevailing market rates. As of June 30, 2015 and December 31, 2014 , the estimated fair value of EQM's long-term debt was approximately $472 million and $496 million , respectively, and the carrying value of EQM's long-term debt was approximately $493 million . |
Distributions
Distributions | 6 Months Ended |
Jun. 30, 2015 | |
Equity [Abstract] | |
Distributions | Distributions EQGP Partnership Distributions EQGP’s partnership agreement requires EQGP to distribute all of its available cash (as defined in EQGP's partnership agreement) to EQGP unitholders within 55 days of the end of each quarter, beginning with the quarter ended June 30, 2015 . On July 21, 2015 , the Board of Directors of EQGP General Partner declared an initial cash distribution to EQGP’s unitholders for the second quarter of 2015 of $0.04739 per common unit. The cash distribution was pro-rated for the 47 -day period from the date of the closing of EQGP's IPO on May 15, 2015 to June 30, 2015 . The cash distribution will be paid on August 24, 2015 to unitholders of record at the close of business on August 4, 2015 . EQM Partnership Distributions EQM's partnership agreement requires EQM to distribute all of its available cash (as defined in EQM's partnership agreement) to EQM unitholders of record on the applicable record date within 45 days after the end of each quarter. EQM declared the following cash distributions to its unitholders, including distributions to EQGP, for the periods presented: Quarter Ended EQM Total Quarterly Distribution per Common Unit EQM Total Quarterly Cash Distribution EQM Quarterly Distribution to Noncontrolling Interests EQM Date of Distribution (Thousands, except per unit data) 2014 March 31 $0.49 $24,950 $13,241 May 2014 June 30 $0.52 $34,100 $20,482 August 2014 2015 March 31 $0.61 $52,222 $29,827 May 2015 June 30 (1) $0.64 $56,464 $31,293 August 2015 (1) On July 21, 2015 , the Board of Directors of EQM General Partner declared a cash distribution to EQM unitholders for the second quarter of 2015 of $0.64 per common unit, $1.1 million to EQM General Partner related to its 2.0% EQM general partner interest and $10.1 million to EQM General Partner related to its incentive distribution rights. The cash distribution will be paid on August 14, 2015 to unitholders of record at the close of business on August 4, 2015 . |
Equity and Partners' Capital (T
Equity and Partners' Capital (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Equity [Abstract] | |
Schedule of Common Units, Subordinated Units and General Partner Units Issued | The following table summarizes EQM's common, subordinated and general partner units issued January 1, 2014 through June 30, 2015 : EQM Limited Partner Units EQM General Partner Units Common Subordinated Total Balance at January 1, 2014 30,468,902 17,339,718 975,686 48,784,306 May 2014 equity offering 12,362,500 — — 12,362,500 Jupiter Acquisition consideration (see Note B) 516,050 — 262,828 778,878 Balance at December 31, 2014 43,347,452 17,339,718 1,238,514 61,925,684 Conversion of subordinated units to common units 17,339,718 (17,339,718 ) — — 2014 EQM VDA issuance 21,063 — 430 21,493 March 2015 equity offering 9,487,500 — 25,255 9,512,755 NWV Gathering Acquisition consideration (see Note B) 511,973 — 178,816 690,789 Balance at June 30, 2015 70,707,706 — 1,443,015 72,150,721 |
Financial Information by Busi18
Financial Information by Business Segment (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Segment Reporting [Abstract] | |
Schedule of revenue from external customers and operating income and reconciliation to net income | All of EQM’s operating revenues, income from operations and assets are generated or located in the United States. Three Months Ended Six Months Ended 2015 2014 2015 2014 (Thousands) Revenues from external customers (including affiliates): Transmission and storage $ 68,140 $ 59,125 $ 147,501 $ 118,442 Gathering 76,473 50,202 151,923 98,793 Total $ 144,613 $ 109,327 $ 299,424 $ 217,235 Operating income: Transmission and storage $ 45,917 $ 41,982 $ 103,207 $ 84,019 Gathering 55,479 30,418 110,941 60,998 Headquarters (1,038 ) — (1,038 ) — Total operating income $ 100,358 $ 72,400 $ 213,110 $ 145,017 Reconciliation of operating income to net income: Equity income 394 — 394 — Other income 1,169 559 1,883 828 Interest expense 11,640 6,629 23,097 12,284 Income tax expense 5,436 13,705 25,770 32,315 Net income $ 84,845 $ 52,625 $ 166,520 $ 101,246 |
Schedule of segment assets | June 30, 2015 December 31, 2014 (Thousands) Segment assets: Transmission and storage $ 998,173 $ 928,864 Gathering 863,350 765,090 Total operating segments $ 1,861,523 $ 1,693,954 Headquarters, including cash 175,959 432,725 Total assets $ 2,037,482 $ 2,126,679 |
Schedule of depreciation, depletion and amortization and expenditures for segment assets | Three Months Ended Six Months Ended 2015 2014 2015 2014 (Thousands) Depreciation and amortization: Transmission and storage $ 7,017 $ 6,322 $ 13,785 $ 12,481 Gathering 5,241 4,114 10,400 7,952 Total $ 12,258 $ 10,436 $ 24,185 $ 20,433 Expenditures for segment assets: Transmission and storage $ 58,020 $ 25,080 $ 79,482 $ 39,081 Gathering 69,029 56,406 105,298 90,855 Total (1) $ 127,049 $ 81,486 $ 184,780 $ 129,936 (1) EQM accrues capital expenditures when work has been completed but the associated bills have not yet been paid. These accrued amounts are excluded from capital expenditures on the statements of consolidated cash flows until they are paid in a subsequent period. Accrued capital expenditures were $27.0 million and $14.4 million at June 30, 2015 and 2014 , respectively. Additionally, EQM capitalizes certain labor overhead costs which include a portion of non-cash equity-based compensation. These non-cash capital expenditures in the table above were less than $0.1 million and approximately $0.1 million for the three months ended June 30, 2015 and 2014 , respectively, and less than $0.1 million and approximately $0.2 million for the six months ended June 30, 2015 and 2014 , respectively. |
Distributions (Tables)
Distributions (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Equity [Abstract] | |
Summary of Cash Distributions to Unitholders | EQM declared the following cash distributions to its unitholders, including distributions to EQGP, for the periods presented: Quarter Ended EQM Total Quarterly Distribution per Common Unit EQM Total Quarterly Cash Distribution EQM Quarterly Distribution to Noncontrolling Interests EQM Date of Distribution (Thousands, except per unit data) 2014 March 31 $0.49 $24,950 $13,241 May 2014 June 30 $0.52 $34,100 $20,482 August 2014 2015 March 31 $0.61 $52,222 $29,827 May 2015 June 30 (1) $0.64 $56,464 $31,293 August 2015 (1) On July 21, 2015 , the Board of Directors of EQM General Partner declared a cash distribution to EQM unitholders for the second quarter of 2015 of $0.64 per common unit, $1.1 million to EQM General Partner related to its 2.0% EQM general partner interest and $10.1 million to EQM General Partner related to its incentive distribution rights. The cash distribution will be paid on August 14, 2015 to unitholders of record at the close of business on August 4, 2015 . |
Financial Statements (Narrative
Financial Statements (Narrative) (Details) | 1 Months Ended | 6 Months Ended |
Apr. 30, 2015 | Jun. 30, 2015partnership_interest_typeshares | |
Financial Statements | ||
Number of types of partnership interests | partnership_interest_type | 3 | |
Common units outstanding | 266,165,000 | |
Percent (up to) of incremental cash distribution in any quarter | 48.00% | |
Limited liability company interest transferred | 100.00% | |
Limited Partner Common | ||
Financial Statements | ||
Common units outstanding | 26,450,000 | |
Limited partner ownership interest | 9.90% | |
General Partner | ||
Financial Statements | ||
General partner ownership interest | 2.00% | |
Affiliated Entity | Limited Partner Common | ||
Financial Statements | ||
Common units outstanding | 21,811,643 | |
Limited partner ownership interest | 30.20% | |
Affiliated Entity | General Partner | ||
Financial Statements | ||
Number of general partner units | 1,443,015 | |
General partner ownership interest | 2.00% |
Acquisitions - NWV Gathering Ac
Acquisitions - NWV Gathering Acquisition (Narrative) (Details) - USD ($) $ in Thousands | Apr. 15, 2015 | Mar. 17, 2015 | Jun. 30, 2015 | Jun. 30, 2014 | |
Business Acquisition [Line Items] | |||||
Cash payment | [1] | $ 45,885 | $ 0 | ||
NWV Gathering | |||||
Business Acquisition [Line Items] | |||||
Consideration paid to acquire preferred interest | $ 925,700 | ||||
Cash payment | $ 873,200 | ||||
NWV Gathering | Partnership Interest | Common Partner Units | |||||
Business Acquisition [Line Items] | |||||
Number of units part of consideration | 511,973 | ||||
NWV Gathering | Partnership Interest | General Partner Units | |||||
Business Acquisition [Line Items] | |||||
Number of units part of consideration | 178,816 | ||||
EQT Energy Supply, LLC | |||||
Business Acquisition [Line Items] | |||||
Consideration paid to acquire preferred interest | $ 124,300 | ||||
[1] | Financial statements for the six months ended June 30, 2015 and 2014 have been retrospectively recast to reflect the inclusion of NWV Gathering. See Note B. |
Acquisitions - MVP Interest Acq
Acquisitions - MVP Interest Acquisition (Narrative) (Details) $ in Millions | Mar. 30, 2015USD ($)mi | Mar. 11, 2015USD ($) |
MVP Interest in Joint Venture | ||
Business Acquisition [Line Items] | ||
Ownership interest | 100.00% | |
Consideration paid | $ 54.2 | |
Reimbursed capital contributions | $ 8.3 | |
Mountain Valley Pipeline | ||
Business Acquisition [Line Items] | ||
Length of pipeline (in miles) | mi | 300 | |
MVP Holdco | ||
Business Acquisition [Line Items] | ||
Ownership interest | 100.00% | |
Mountain Valley Pipeline | ||
Business Acquisition [Line Items] | ||
Ownership interest | 55.00% | |
EQM | WGL Holdings, Inc. | ||
Business Acquisition [Line Items] | ||
Ownership interest | 7.00% | |
EQM | Vega Energy Partners, Ltd. | ||
Business Acquisition [Line Items] | ||
Ownership interest | 3.00% |
Acquisitions - Jupiter Acquisit
Acquisitions - Jupiter Acquisition (Narrative) (Details) - USD ($) $ in Thousands | May. 07, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Business Acquisition [Line Items] | ||||
Cash payment | [1] | $ 45,885 | $ 0 | |
Common units issued | 266,165,000 | |||
EQT | Jupiter | ||||
Business Acquisition [Line Items] | ||||
Consideration paid | $ 1,180,000 | |||
Cash payment | $ 1,121,000 | |||
Common units issued | 516,050 | |||
General partner units issued | 262,828 | |||
[1] | Financial statements for the six months ended June 30, 2015 and 2014 have been retrospectively recast to reflect the inclusion of NWV Gathering. See Note B. |
Equity and Partners' Capital -
Equity and Partners' Capital - Holdings of EQGP Equity (Narrative) (Details) - shares | May. 15, 2015 | Mar. 17, 2015 | Jun. 30, 2015 | Dec. 31, 2014 |
Class of Stock [Line Items] | ||||
Common units outstanding | 266,165,000 | |||
EQM | ||||
Class of Stock [Line Items] | ||||
Number of common units issued for IPO | 9,512,755 | 12,362,500 | ||
Limited Partner Common | ||||
Class of Stock [Line Items] | ||||
Number of common units issued for IPO | 26,450,000 | |||
Common units outstanding | 26,450,000 | |||
Limited partner ownership interest | 9.90% | |||
Limited Partner Common | EQM | ||||
Class of Stock [Line Items] | ||||
Number of common units issued for IPO | 8,250,000 | 9,487,500 | 12,362,500 | |
Common units outstanding | 48,896,063 | |||
Limited partner ownership interest | 67.80% | |||
Limited Partner Subordinated | EQM | ||||
Class of Stock [Line Items] | ||||
Number of common units issued for IPO | 0 | 0 | ||
Affiliated Entity | Limited Partner Common | ||||
Class of Stock [Line Items] | ||||
Common units outstanding | 21,811,643 | |||
Limited partner ownership interest | 30.20% | |||
Affiliated Entity | Limited Partner Common | EQT | ||||
Class of Stock [Line Items] | ||||
Common units outstanding | 239,715,000 | |||
Limited partner ownership interest | 90.10% |
Equity and Partners' Capital 25
Equity and Partners' Capital - Net Income Per Limited Partner Unit (Narrative) (Details) | 2 Months Ended |
Jun. 30, 2015 | |
Equity [Abstract] | |
Period for calculating net income per limited partner unit | 47 days |
Equity and Partners' Capital 26
Equity and Partners' Capital - Holdings of EQM Equity (Narrative) (Details) $ in Thousands | May. 15, 2015shares | Mar. 18, 2015USD ($)shares | Mar. 17, 2015USD ($)shares | Feb. 17, 2015 | Feb. 28, 2015shares | Jun. 30, 2015USD ($)shares | Jun. 30, 2014USD ($) | Dec. 31, 2014shares | Dec. 31, 2012shares | Dec. 31, 2013shares | |
Class of Stock [Line Items] | |||||||||||
Common units outstanding | 266,165,000 | ||||||||||
Proceeds from the issuance of EQM common units, net of offering costs | $ | [1] | $ 696,582 | $ 902,451 | ||||||||
Increase to deferred tax liability | $ | $ 73,000 | ||||||||||
Common Units | |||||||||||
Class of Stock [Line Items] | |||||||||||
Gain to parent net investment in connection with IPO | $ | 122,800 | ||||||||||
Noncontrolling Interest | |||||||||||
Class of Stock [Line Items] | |||||||||||
Gain to parent net investment in connection with IPO | $ | $ 195,800 | ||||||||||
EQM | |||||||||||
Class of Stock [Line Items] | |||||||||||
Number of general partner units | 72,150,721 | 61,925,684 | 48,784,306 | ||||||||
Conversion ratio | 1 | ||||||||||
2014 EQM VDA issuance (in shares) | 21,493 | ||||||||||
Equity offering (in shares) | 9,512,755 | 12,362,500 | |||||||||
Limited Partner Common | |||||||||||
Class of Stock [Line Items] | |||||||||||
Common units outstanding | 26,450,000 | ||||||||||
Limited partner ownership interest | 9.90% | ||||||||||
Equity offering (in shares) | 26,450,000 | ||||||||||
Limited Partner Common | EQM | |||||||||||
Class of Stock [Line Items] | |||||||||||
Common units outstanding | 48,896,063 | ||||||||||
Limited partner ownership interest | 67.80% | ||||||||||
Number of general partner units | 70,707,706 | 43,347,452 | 30,468,902 | ||||||||
2014 EQM VDA issuance (in shares) | 21,063 | 21,063 | |||||||||
Equity offering (in shares) | 8,250,000 | 9,487,500 | 12,362,500 | ||||||||
Proceeds from the issuance of EQM common units, net of offering costs | $ | $ 696,600 | ||||||||||
Limited Partner Common | EQM | Over-Allotment Option | |||||||||||
Class of Stock [Line Items] | |||||||||||
Equity offering (in shares) | 1,237,500 | ||||||||||
General Partner | |||||||||||
Class of Stock [Line Items] | |||||||||||
General partner ownership interest | 2.00% | ||||||||||
General Partner | EQM | |||||||||||
Class of Stock [Line Items] | |||||||||||
Number of general partner units | 1,443,015 | 1,238,514 | 975,686 | ||||||||
2014 EQM VDA issuance (in shares) | 430 | 430 | |||||||||
Equity offering (in shares) | 25,255 | 0 | |||||||||
General Partner | EQT | |||||||||||
Class of Stock [Line Items] | |||||||||||
General partner ownership interest | 2.00% | 2.00% | |||||||||
Sale of general partner units | $ | $ 1,900 | ||||||||||
Limited Partner Subordinated | EQM | |||||||||||
Class of Stock [Line Items] | |||||||||||
Number of general partner units | 0 | 17,339,718 | 17,339,718 | ||||||||
Number of units issued in connection with IPO | 17,339,718 | ||||||||||
2014 EQM VDA issuance (in shares) | 0 | ||||||||||
Equity offering (in shares) | 0 | 0 | |||||||||
Affiliated Entity | Limited Partner Common | |||||||||||
Class of Stock [Line Items] | |||||||||||
Common units outstanding | 21,811,643 | ||||||||||
Limited partner ownership interest | 30.20% | ||||||||||
Affiliated Entity | Limited Partner Common | EQT | |||||||||||
Class of Stock [Line Items] | |||||||||||
Common units outstanding | 239,715,000 | ||||||||||
Limited partner ownership interest | 90.10% | ||||||||||
Affiliated Entity | General Partner | |||||||||||
Class of Stock [Line Items] | |||||||||||
Number of general partner units | 1,443,015 | ||||||||||
General partner ownership interest | 2.00% | ||||||||||
[1] | Financial statements for the six months ended June 30, 2015 and 2014 have been retrospectively recast to reflect the inclusion of NWV Gathering. See Note B. |
Equity and Partners' Capital 27
Equity and Partners' Capital - EQM's common, subordinated and general partner units issued (Details) - shares | May. 15, 2015 | Mar. 17, 2015 | Feb. 28, 2015 | Jun. 30, 2015 | Dec. 31, 2014 |
Limited Partners Common | |||||
Increase (Decrease) in Partners' Capital | |||||
Equity offering (in shares) | 26,450,000 | ||||
EQM | |||||
Increase (Decrease) in Partners' Capital | |||||
Beginning Balance (in shares) | 61,925,684 | 48,784,306 | |||
Equity offering (in shares) | 9,512,755 | 12,362,500 | |||
Conversion of subordinated units to common units (in shares) | 0 | ||||
2014 EQM VDA issuance (in shares) | 21,493 | ||||
Ending Balance (in shares) | 72,150,721 | 61,925,684 | |||
EQM | Limited Partners Common | |||||
Increase (Decrease) in Partners' Capital | |||||
Beginning Balance (in shares) | 43,347,452 | 30,468,902 | |||
Equity offering (in shares) | 8,250,000 | 9,487,500 | 12,362,500 | ||
Conversion of subordinated units to common units (in shares) | 17,339,718 | ||||
2014 EQM VDA issuance (in shares) | 21,063 | 21,063 | |||
Ending Balance (in shares) | 70,707,706 | 43,347,452 | |||
EQM | Limited Partner Subordinated | |||||
Increase (Decrease) in Partners' Capital | |||||
Beginning Balance (in shares) | 17,339,718 | 17,339,718 | |||
Equity offering (in shares) | 0 | 0 | |||
Conversion of subordinated units to common units (in shares) | (17,339,718) | ||||
2014 EQM VDA issuance (in shares) | 0 | ||||
Ending Balance (in shares) | 0 | 17,339,718 | |||
EQM | General Partner | |||||
Increase (Decrease) in Partners' Capital | |||||
Beginning Balance (in shares) | 1,238,514 | 975,686 | |||
Equity offering (in shares) | 25,255 | 0 | |||
Conversion of subordinated units to common units (in shares) | 0 | ||||
2014 EQM VDA issuance (in shares) | 430 | 430 | |||
Ending Balance (in shares) | 1,443,015 | 1,238,514 | |||
EQM | Jupiter | |||||
Increase (Decrease) in Partners' Capital | |||||
Acquisition consideration (in shares) | 778,878 | ||||
EQM | Jupiter | Limited Partners Common | |||||
Increase (Decrease) in Partners' Capital | |||||
Acquisition consideration (in shares) | 516,050 | ||||
EQM | Jupiter | Limited Partner Subordinated | |||||
Increase (Decrease) in Partners' Capital | |||||
Acquisition consideration (in shares) | 0 | ||||
EQM | Jupiter | General Partner | |||||
Increase (Decrease) in Partners' Capital | |||||
Acquisition consideration (in shares) | 262,828 | ||||
EQM | NWV Gathering | |||||
Increase (Decrease) in Partners' Capital | |||||
Acquisition consideration (in shares) | 690,789 | ||||
EQM | NWV Gathering | Limited Partners Common | |||||
Increase (Decrease) in Partners' Capital | |||||
Acquisition consideration (in shares) | 511,973 | ||||
EQM | NWV Gathering | Limited Partner Subordinated | |||||
Increase (Decrease) in Partners' Capital | |||||
Acquisition consideration (in shares) | 0 | ||||
EQM | NWV Gathering | General Partner | |||||
Increase (Decrease) in Partners' Capital | |||||
Acquisition consideration (in shares) | 178,816 |
Financial Information by Busi28
Financial Information by Business Segment (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||||||
Jun. 30, 2015USD ($) | Jun. 30, 2014USD ($) | Jun. 30, 2015USD ($)segment | Jun. 30, 2014USD ($) | Dec. 31, 2014USD ($) | ||||||
Segment Information | ||||||||||
Number of operating segments | segment | 2 | |||||||||
Revenues from external customers (including affiliates) | [1],[2] | $ 144,613 | $ 109,327 | $ 299,424 | $ 217,235 | |||||
Operating income | [1] | 100,358 | 72,400 | 213,110 | 145,017 | |||||
Equity income | [1],[3] | 394 | 0 | 394 | [4] | 0 | [4] | |||
Other income | [1] | 1,169 | 559 | 1,883 | 828 | |||||
Interest expense | [1],[5] | 11,640 | 6,629 | 23,097 | 12,284 | |||||
Income tax expense | [1] | 5,436 | 13,705 | 25,770 | 32,315 | |||||
Net income | [1] | 84,845 | 52,625 | 166,520 | [4],[6] | 101,246 | [4],[6] | |||
Segment assets | [7] | 2,037,482 | 2,037,482 | $ 2,126,679 | ||||||
Depreciation and amortization | [1] | 12,258 | 10,436 | 24,185 | [4] | 20,433 | [4] | |||
Expenditures for segment assets | 127,049 | [8] | 81,486 | [8] | 184,780 | 129,936 | ||||
Accrued capital expenditures | 27,000 | 14,400 | 27,000 | 14,400 | ||||||
Non-cash compensation costs capitalized (less than and approximately for the three and six months ended June 30, 2015 and 2014, respectively) | 100 | 100 | 200 | |||||||
Headquarters, including cash | ||||||||||
Segment Information | ||||||||||
Operating income | (1,038) | 0 | (1,038) | 0 | ||||||
Segment assets | 175,959 | 175,959 | 432,725 | |||||||
Total operating segments | ||||||||||
Segment Information | ||||||||||
Segment assets | 1,861,523 | 1,861,523 | 1,693,954 | |||||||
Transmission and storage | ||||||||||
Segment Information | ||||||||||
Revenues from external customers (including affiliates) | 68,140 | 59,125 | 147,501 | 118,442 | ||||||
Operating income | 45,917 | 41,982 | 103,207 | 84,019 | ||||||
Segment assets | 998,173 | 998,173 | 928,864 | |||||||
Depreciation and amortization | 7,017 | 6,322 | 13,785 | 12,481 | ||||||
Expenditures for segment assets | 58,020 | 25,080 | 79,482 | 39,081 | ||||||
Gathering | ||||||||||
Segment Information | ||||||||||
Revenues from external customers (including affiliates) | 76,473 | 50,202 | 151,923 | 98,793 | ||||||
Operating income | 55,479 | 30,418 | 110,941 | 60,998 | ||||||
Segment assets | 863,350 | 863,350 | $ 765,090 | |||||||
Depreciation and amortization | 5,241 | 4,114 | 10,400 | 7,952 | ||||||
Expenditures for segment assets | $ 69,029 | $ 56,406 | $ 105,298 | $ 90,855 | ||||||
[1] | Financial statements for the six months ended June 30, 2015 and the three and six months ended June 30, 2014 have been retrospectively recast to reflect the inclusion of the Northern West Virginia Marcellus gathering system (NWV Gathering). See Note B. | |||||||||
[2] | Operating revenues included affiliate revenues from EQT Corporation and subsidiaries (collectively, EQT) of $107.7 million and $74.9 million for the three months ended June 30, 2015 and 2014, respectively, and $214.3 million and $147.2 million for the six months ended June 30, 2015 and 2014, respectively. See Note E. | |||||||||
[3] | Equity income relates to EQM's interest in Mountain Valley Pipeline, LLC, which is a related party. | |||||||||
[4] | Financial statements for the six months ended June 30, 2015 and 2014 have been retrospectively recast to reflect the inclusion of NWV Gathering. See Note B. | |||||||||
[5] | Interest expense included interest on a capital lease with an affiliate of $5.9 million and $5.4 million for the three months ended June 30, 2015 and 2014, respectively, and $11.8 million and $10.3 million for the six months ended June 30, 2015 and 2014, respectively. | |||||||||
[6] | Financial statements for the six months ended June 30, 2015 and 2014 have been retrospectively recast to reflect the inclusion of NWV Gathering. See Note B. | |||||||||
[7] | Financial statements as of December 31, 2014 have been retrospectively recast to reflect the inclusion of NWV Gathering. See Note B. | |||||||||
[8] | accrues capital expenditures when work has been completed but the associated bills have not yet been paid. These accrued amounts are excluded from capital expenditures on the statements of consolidated cash flows until they are paid in a subsequent period. Accrued capital expenditures were $27.0 million and $14.4 million at June 30, 2015 and 2014, respectively. Additionally, EQM capitalizes certain labor overhead costs which include a portion of non-cash equity-based compensation. These non-cash capital expenditures in the table above were less than $0.1 million and approximately $0.1 million for the three months ended June 30, 2015 and 2014, respectively, and less than $0.1 million and approximately $0.2 million for the six months ended June 30, 2015 and 2014, respectively. |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | ||
Income Tax Disclosure [Abstract] | |||
Elimination of net current and deferred tax liabilities | [1] | $ 164,586 | |
Effective Income Tax Rate Reconciliation, Percent | 13.40% | 24.20% | |
[1] | Financial statements for the six months ended June 30, 2015 and 2014 have been retrospectively recast to reflect the inclusion of NWV Gathering. See Note B. |
Short-term Loans (Details)
Short-term Loans (Details) - USD ($) | May. 15, 2015 | Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | Dec. 31, 2014 | |
Short-term Debt [Line Items] | |||||||
Short-term debt amount outstanding | [1] | $ 312,000,000 | $ 312,000,000 | $ 0 | |||
Line of Credit | EQM | |||||||
Short-term Debt [Line Items] | |||||||
Maximum borrowing capacity | 750,000,000 | 750,000,000 | |||||
Line of Credit | Working Capital Facility | EQT | |||||||
Short-term Debt [Line Items] | |||||||
Maximum borrowing capacity | $ 50,000,000 | ||||||
Notice of termination | 90 days | ||||||
Line of Credit | Working Capital Facility | EQT | |||||||
Short-term Debt [Line Items] | |||||||
Short-term debt amount outstanding | 0 | 0 | |||||
Line of Credit | Revolving Credit Facility | EQM | |||||||
Short-term Debt [Line Items] | |||||||
Short-term debt amount outstanding | 312,000,000 | 312,000,000 | $ 0 | ||||
Short-term Debt | EQM | |||||||
Short-term Debt [Line Items] | |||||||
Maximum amount of outstanding short-term loans at any time during the period | 323,000,000 | $ 450,000,000 | 390,000,000 | $ 450,000,000 | |||
Average daily balance of short-term loans outstanding | $ 302,000,000 | $ 252,000,000 | $ 182,000,000 | $ 173,000,000 | |||
Interest rate | 1.69% | 1.66% | 1.69% | 1.68% | |||
[1] | Financial statements as of December 31, 2014 have been retrospectively recast to reflect the inclusion of NWV Gathering. See Note B. |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Thousands | Jun. 30, 2015 | Dec. 31, 2014 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Carrying value of long-term debt | [1] | $ 493,017 | $ 492,633 |
EQM | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Fair value of long-term debt | 472,000 | $ 496,000 | |
Carrying value of long-term debt | [1] | $ 493,000 | |
[1] | Financial statements as of December 31, 2014 have been retrospectively recast to reflect the inclusion of NWV Gathering. See Note B. |
Distributions (Narrative) (Deta
Distributions (Narrative) (Details) - $ / shares | Jul. 21, 2015 | Jun. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Jun. 30, 2014 | Mar. 31, 2014 | Jun. 30, 2015 | ||
Class of Stock [Line Items] | |||||||||
Cash distribution period after quarter end | 55 days | ||||||||
Cash distributions declared per unit (in dollars per share) | [1],[2] | $ 0.04739 | $ 0.04739 | ||||||
Pro-rated distribution period | 47 days | ||||||||
EQM | |||||||||
Class of Stock [Line Items] | |||||||||
Cash distribution period after quarter end | 45 days | ||||||||
Cash distributions declared per unit (in dollars per share) | $ 0.64 | [3] | $ 0.61 | $ 0.52 | $ 0.49 | ||||
Subsequent Event | |||||||||
Class of Stock [Line Items] | |||||||||
Cash distributions declared per unit (in dollars per share) | $ 0.04739 | ||||||||
Subsequent Event | EQM | |||||||||
Class of Stock [Line Items] | |||||||||
Cash distributions declared per unit (in dollars per share) | $ 0.64 | ||||||||
[1] | Financial statements for the six months ended June 30, 2015 and the three and six months ended June 30, 2014 have been retrospectively recast to reflect the inclusion of the Northern West Virginia Marcellus gathering system (NWV Gathering). See Note B. | ||||||||
[2] | Represents the cash distributions declared related to the period presented. The initial distribution has been pro-rated for the 47-day period from the date of the closing of EQGP’s IPO on May 15, 2015 to June 30, 2015. See Note I. | ||||||||
[3] | On July 21, 2015, the Board of Directors of EQM General Partner declared a cash distribution to EQM unitholders for the second quarter of 2015 of $0.64 per common unit, $1.1 million to EQM General Partner related to its 2.0% EQM general partner interest and $10.1 million to EQM General Partner related to its incentive distribution rights. The cash distribution will be paid on August 14, 2015 to unitholders of record at the close of business on August 4, 2015. |
Distributions - Cash Distributi
Distributions - Cash Distributions Declared (Details) - USD ($) $ / shares in Units, $ in Thousands | Jul. 21, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Jun. 30, 2014 | Mar. 31, 2014 | Jun. 30, 2015 | ||
Distribution Made to Limited Partner [Line Items] | ||||||||
EQM Total Quarterly Distribution per Common Unit | [1],[2] | $ 0.04739 | $ 0.04739 | |||||
General Partner | ||||||||
Distribution Made to Limited Partner [Line Items] | ||||||||
General partner's ownership interest | 2.00% | |||||||
Subsequent Event | ||||||||
Distribution Made to Limited Partner [Line Items] | ||||||||
EQM Total Quarterly Distribution per Common Unit | $ 0.04739 | |||||||
EQM | ||||||||
Distribution Made to Limited Partner [Line Items] | ||||||||
EQM Total Quarterly Distribution per Common Unit | $ 0.64 | [3] | $ 0.61 | $ 0.52 | $ 0.49 | |||
EQM Total Quarterly Cash Distribution | $ 56,464 | [3] | $ 52,222 | $ 34,100 | $ 24,950 | |||
EQM | Noncontrolling Interest | ||||||||
Distribution Made to Limited Partner [Line Items] | ||||||||
EQM Total Quarterly Cash Distribution | $ 31,293 | [3] | $ 29,827 | $ 20,482 | $ 13,241 | |||
EQM | Subsequent Event | ||||||||
Distribution Made to Limited Partner [Line Items] | ||||||||
EQM Total Quarterly Distribution per Common Unit | $ 0.64 | |||||||
EQM | Subsequent Event | General Partner | ||||||||
Distribution Made to Limited Partner [Line Items] | ||||||||
EQM Total Quarterly Cash Distribution | $ 1,100 | |||||||
General partner's ownership interest | 2.00% | |||||||
Cash distribution related to incentive distribution rights | $ 10,100 | |||||||
[1] | Financial statements for the six months ended June 30, 2015 and the three and six months ended June 30, 2014 have been retrospectively recast to reflect the inclusion of the Northern West Virginia Marcellus gathering system (NWV Gathering). See Note B. | |||||||
[2] | Represents the cash distributions declared related to the period presented. The initial distribution has been pro-rated for the 47-day period from the date of the closing of EQGP’s IPO on May 15, 2015 to June 30, 2015. See Note I. | |||||||
[3] | On July 21, 2015, the Board of Directors of EQM General Partner declared a cash distribution to EQM unitholders for the second quarter of 2015 of $0.64 per common unit, $1.1 million to EQM General Partner related to its 2.0% EQM general partner interest and $10.1 million to EQM General Partner related to its incentive distribution rights. The cash distribution will be paid on August 14, 2015 to unitholders of record at the close of business on August 4, 2015. |