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Related Party Transactions | 12 Months Ended
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Dec. 31, 2012
Related Party Transactions [Abstract] |
Related Party Transactions | Note 15. Related Party Transactions The following table summarizes our related party transactions for the periods presented:
|  | For Year Ended December 31, |
|  | 2012 |  |  | 2011 |  |  | 2010 |
Revenues – related parties: |  |  |  |  |  |  |  |  |
Energy Transfer Equity and subsidiaries |  | $ | -- |  |  | $ | 573.2 |  |  | $ | 490.5 |
Other unconsolidated affiliates |  |  | 73.3 |  |  |  | 201.9 |  |  |  | 207.9 |
Total revenue – related parties |  | $ | 73.3 |  |  | $ | 775.1 |  |  | $ | 698.4 |
Costs and expenses – related parties: |  |  |  |  |  |  |  |  |  |  |  |
EPCO and affiliates |  | $ | 816.9 |  |  | $ | 722.7 |  |  | $ | 712.5 |
Energy Transfer Equity and subsidiaries |  |  | -- |  |  |  | 1,101.5 |  |  |  | 724.4 |
Other unconsolidated affiliates |  |  | 40.2 |  |  |  | 49.8 |  |  |  | 50.2 |
Total costs and expenses – related parties |  | $ | 857.1 |  |  | $ | 1,874.0 |  |  | $ | 1,487.1 |
Energy Transfer Equity was a related party to us during the periods in which we accounted for our investment in its limited partner units using the equity method of accounting. We ceased reporting Energy Transfer Equity as a related party in January 2012. See Note 9 for information regarding the liquidation of our investment in Energy Transfer Equity. For information regarding the Duncan and Holdings Mergers, which were related party transactions, see Note 1. The following table summarizes our related party accounts receivable and accounts payable balances at the dates indicated:
|  | December 31, |
|  | 2012 |  |  | 2011 |
Accounts receivable - related parties: |  |  |  |  |  |
Energy Transfer Equity and subsidiaries |  | $ | -- |  |  | $ | 28.4 |
Other unconsolidated affiliates |  |  | 2.5 |  |  |  | 15.1 |
Total accounts receivable – related parties |  | $ | 2.5 |  |  | $ | 43.5 |
Accounts payable - related parties: |  |  |  |  |  |  |  |
EPCO and affiliates |  | $ | 102.4 |  |  | $ | 108.3 |
Energy Transfer Equity and subsidiaries |  |  | -- |  |  |  | 92.6 |
Other unconsolidated affiliates |  |  | 24.7 |  |  |  | 10.7 |
Total accounts payable – related parties |  | $ | 127.1 |  |  | $ | 211.6 |
We believe that the terms and provisions of our related party agreements are fair to us; however, such agreements and transactions may not be as favorable to us as we could have obtained from unaffiliated third parties. Relationship with EPCO and Affiliates We have an extensive and ongoing relationship with EPCO and its privately held affiliates (including Enterprise GP, our general partner), which are not a part of our consolidated group of companies. At December 31, 2012, EPCO and its privately held affiliates (including Dan Duncan LLC and certain Duncan family trusts, the beneficiaries of which include the estate of Dan L. Duncan) beneficially owned the following limited partner interests in us:
Number of Units | Percentage of Total Units Outstanding
339,130,881 (1) | 37.5%
(1) Includes 4,520,431 Class B units.
We and Enterprise GP are both separate legal entities apart from each other and apart from EPCO and its other affiliates, with assets and liabilities that are also separate from those of EPCO and its other affiliates. EPCO and its privately held affiliates depend on the cash distributions they receive from us and other investments to fund their other activities and to meet their debt obligations. The following table presents cash distributions received by EPCO and its privately held affiliates from us and Holdings during the periods presented:
|  | For Year Ended December 31, |
|  | 2012 |  |  | 2011 |  |  | 2010 |
Enterprise |  | $ | 750.2 |  |  | $ | 701.5 |  |  | $ | 344.1 |
Holdings (prior to Holdings Merger) |  |  | -- |  |  |  | -- |  |  |  | 237.4 |
Total |  | $ | 750.2 |  |  | $ | 701.5 |  |  | $ | 581.5 |
From time-to-time, EPCO and its privately held affiliates elect to reinvest a portion of the cash distributions they would otherwise receive from us into the purchase of additional common units under our DRIP. See Note 13 for information regarding these reinvestments, including an expected reinvestment of up to $100 million during 2013. Privately held affiliates of EPCO (together with their respective subsidiaries) have pledged up to 62,500,000 of our common units that they own as security under such affiliates' credit facilities. These credit facilities contain customary and other events of default, including defaults by us and other affiliates of EPCO. An event of default, followed by a foreclosure on the pledged collateral, could ultimately result in a change in ownership of these units. A development of this nature could affect the market price of our common units. We lease office space from affiliates of EPCO. The rental rates in these lease agreements approximate market rates. EPCO ASA. We have no employees. All of our operating functions and general and administrative support services are provided by employees of EPCO pursuant to the ASA or by other service providers. We and our general partner are parties to the ASA. The significant terms of the ASA are as follows:
§ | EPCO will provide selling, general and administrative services and management and operating services as may be necessary to manage and operate our businesses, properties and assets (all in accordance with prudent industry practices). EPCO will employ or otherwise retain the services of such personnel.
§ | We are required to reimburse EPCO for its services in an amount equal to the sum of all costs and expenses incurred by EPCO which are directly or indirectly related to our business or activities (including expenses reasonably allocated to us by EPCO). In addition, we have agreed to pay all sales, use, excise, value added or similar taxes, if any, that may be applicable from time to time with respect to the services provided to us by EPCO.
§ | EPCO will allow us to participate as a named insured in its overall insurance program, with the associated premiums and other costs being allocated to us. See Note 19 for additional information regarding our insurance programs.
Under the ASA, EPCO subleased to us (for $1 per year) certain equipment it held pursuant to operating leases. EPCO was liable for the cash payments associated with these lease agreements. In June 2011, we paid $5.4 million to purchase the assets from the lessor and the lease agreements were terminated. While these lease agreements were in effect, we recorded the full value of the lease payments made by EPCO on our behalf as a non-cash related party operating expense, with the offset to equity accounted for as a general contribution to our partnership. The value of these lease payments was $0.3 million and $0.7 million for the years ended December 31, 2011 and 2010, respectively. Our operating costs and expenses include amounts paid to EPCO for the costs it incurs to operate our facilities, including the compensation of its employees. We reimburse EPCO for actual direct and indirect expenses it incurs related to the operation of our assets. Likewise, our general and administrative costs include amounts paid to EPCO for administrative services, including the compensation of its employees. In general, our reimbursement to EPCO for administrative services is either (i) on an actual basis for direct expenses it may incur on our behalf (e.g., the purchase of office supplies) or (ii) based on an allocation of such charges between the various parties to the ASA based on the estimated use of such services by each party (e.g., the allocation of legal or accounting salaries based on estimates of time spent on each entity's business and affairs). The following table presents our costs and expenses attributable to the ASA and other related party transactions with EPCO for the periods presented:
|  | For Year Ended December 31, |
|  | 2012 |  |  | 2011 |  |  | 2010 |
Operating costs and expenses |  | $ | 719.4 |  |  | $ | 611.6 |  |  | $ | 588.5 |
General and administrative expenses |  |  | 97.5 |  |  |  | 111.1 |  |  |  | 124.0 |
Total costs and expenses |  | $ | 816.9 |  |  | $ | 722.7 |  |  | $ | 712.5 |
Since the vast majority of such expenses are charged to us on an actual basis (i.e., no mark-up or subsidy is charged or received by EPCO), we believe that such expenses are representative of what the amounts would have been on a standalone basis. With respect to allocated costs, we believe that the proportional direct allocation method employed by EPCO is reasonable and reflective of the estimated level of costs we would have incurred on a standalone basis. Acquisition of EPCO's Trucking Business. In September 2010, we acquired EPCO's trucking business in exchange for 523,306 of our common units. Since we and EPCO are under common control, we recorded the net assets of this business based on EPCO's historical cost basis of $37.8 million, which included $5.5 million of goodwill. The equity consideration we issued was based on the average closing price of our common units over a 20-day period ending September 28, 2010. Relationships with Unconsolidated Affiliates Many of our unconsolidated affiliates perform supporting or complementary roles to our other business operations. The following information summarizes significant related party transactions with our current unconsolidated affiliates:
§ | We pay Promix for the transportation, storage and fractionation of NGLs. In addition, we sell natural gas to Promix for its plant fuel requirements. Revenues from Promix were $7.8 million, $18.3 million and $13.1 million for the years ended December 31, 2012, 2011 and 2010, respectively. Expenses with Promix were $27.4 million, $44.9 million and $35.6 million for the years ended December 31, 2012, 2011 and 2010, respectively.
§ | For the years ended December 31, 2011 and 2010, we paid $2.8 million and $8.9 million, respectively, to Centennial for other pipeline transportation services. No payments were made in 2012.
§ | For the years ended December 31, 2012, 2011 and 2010, we paid Seaway $18.1 million, $1.4 million and $4.5 million, respectively, for pipeline transportation and storage services in connection with our crude oil marketing activities.
§ | For the year ended December 31, 2012, 2011 and 2010, we paid White River Hub $6.6 million, $6.7 million and $6.0 million, respectively, for pipeline transportation services.
§ | We perform management services for certain of our unconsolidated affiliates. We charged such affiliates $19.4 million, $13.0 million and $11.5 million for the years ended December 31, 2012, 2011 and 2010, respectively.
Prior to acquiring the remaining ownership interests in Evangeline in June 2012, we sold natural gas to Evangeline, which, in turn, used the natural gas to satisfy its supply commitments to a customer. Revenues from Evangeline were $42.9 million, $166.1 million and $174.5 million for the years ended December 31, 2012, 2011 and 2010, respectively.

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- Definition The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 850 -SubTopic 10 -Section 50 -Paragraph 6 -URI http://asc.fasb.org/extlink&oid=6457730&loc=d3e39691-107864 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 850 -SubTopic 10 -Section 50 -Paragraph 4 -URI http://asc.fasb.org/extlink&oid=6457730&loc=d3e39622-107864 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 850 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6457730&loc=d3e39549-107864 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 57 -Paragraph 1-4 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 850 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6457730&loc=d3e39603-107864 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 850 -SubTopic 10 -Section 50 -Paragraph 5 -URI http://asc.fasb.org/extlink&oid=6457730&loc=d3e39678-107864 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08.(k)) -URI http://asc.fasb.org/extlink&oid=6881521&loc=d3e23780-122690 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 04 -Paragraph b -Article 3A Reference 9: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 08 -Paragraph k -Article 4 + Details
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