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Acquisitions | 6 Months Ended
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Jun. 30, 2017
Equity [Abstract] |
Acquisitions | Acquisitions Acquisition of Hardin Street Transportation LLC, Woodhaven Cavern LLC and MPLX Terminals LLC MPC contributed the assets of HST, WHC and MPLXT to newly created and wholly-owned subsidiaries and entered into commercial agreements related to services provided by these new entities to MPC on January 1, 2015 for HST and WHC and April 1, 2016 for MPLXT. Pursuant to a Membership Interests Contributions Agreement (the “Contributions Agreement”) entered into on March 1, 2017 by the Partnership with MPLX GP LLC (“MPLX GP”), MPLX Logistics Holdings LLC (“MPLX Logistics”), MPLX Holdings Inc. (“MPLX Holdings”) and MPC Investment LLC (“MPC Investment”), each a wholly-owned subsidiary of MPC, MPC Investment agreed to contribute the outstanding membership interests in HST, WHC and MPLXT through a series of intercompany contributions to the Partnership for approximately $1.5 billion in cash and equity consideration valued at approximately $504 million (the “Transaction”). The number of common units representing the equity consideration was determined by dividing the contribution amount by the simple average of the ten day trailing volume weighted average New York Stock Exchange price of a common unit for the ten trading days ending at market close on February 28, 2017. The fair value of the common and general partner units issued was approximately $503 million, as recorded on the Consolidated Statements of Equity, and consisted of (i) 9,197,900 common units representing limited partner interests in the Partnership to MPLX GP, (ii) 2,630,427 common units to MPLX Logistics and (iii) 1,132,049 common units to MPLX Holdings. The Partnership also issued 264,497 general partner units to MPLX GP in order to maintain its two percent general partner interest (“GP Interest”) in the Partnership. MPC agreed to waive two-thirds of the first quarter 2017 distributions on the MPLX LP common units issued in connection with the Transaction. As a result of this waiver, MPC did not receive two-thirds of the general partner distributions or incentive distribution rights that would have otherwise accrued on such MPLX LP common units with respect to the first quarter 2017 distributions. The value of these waived distributions was $6 million. HST owns and operates various private crude oil and refined product pipeline systems and associated storage tanks. As of the acquisition date, these pipeline systems consisted of 174 miles of crude oil pipelines and 430 miles of refined products pipelines. WHC owns and operates nine butane and propane storage caverns located in Michigan with approximately 1.8 million barrels of natural gas liquids storage capacity. As of the acquisition date, MPLXT owned and operated 59 terminals for the receipt, storage, blending, additization, handling and redelivery of refined petroleum products. Additionally, MPLXT operated one leased terminal and had partial ownership interest in two terminals. Collectively, these 62 terminals have a combined shell capacity of approximately 23.6 million barrels. The terminal facilities are located primarily in the Midwest, Gulf Coast and Southeast regions of the United States. The Partnership accounts for these businesses within its L&S segment. The Partnership retrospectively adjusted the historical financial results for all periods to give effect to the acquisition of HST and WHC effective January 1, 2015 and the acquisition of MPLXT effective April 1, 2016, as required for transactions between entities under common control. Prior to these dates, these entities were not considered businesses and, therefore, there are no financial results from which to recast. The following tables present the Partnership’s previously reported unaudited Consolidated Statements of Income for the three and six months ended June 30, 2016, retrospectively adjusted for the acquisition of HST, WHC and MPLXT:
| Three Months Ended June 30, 2016
(In millions, except per unit data) | MPLX LP (Previously Reported) |  | HST/WHC |  | MPLXT |  | Eliminations(1) |  | MPLX LP (Currently Reported)
Revenues and other income: |  |  |  |  |  |  |  |  |
Service revenue | $ | 233 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 233 |
Service revenue - related parties | 145 |  |  | 27 |  |  | 74 |  |  | — |  |  | 246 |
Rental income | 71 |  |  | — |  |  | — |  |  | — |  |  | 71 |
Rental income - related parties | 29 |  |  | 11 |  |  | 26 |  |  | — |  |  | 66 |
Product sales | 137 |  |  | — |  |  | — |  |  | — |  |  | 137 |
Product sales - related parties | 3 |  |  | — |  |  | — |  |  | — |  |  | 3 |
Loss from equity method investments | (83 | ) |  | — |  |  | — |  |  | — |  |  | (83 | )
Other income | 1 |  |  | — |  |  | — |  |  | — |  |  | 1 |
Other income - related parties | 28 |  |  | — |  |  | — |  |  | (4 | ) |  | 24 |
Total revenues and other income | 564 |  |  | 38 |  |  | 100 |  |  | (4 | ) |  | 698 |
Costs and expenses: |  |  |  |  |  |  |  |  |
Cost of revenues (excludes items below) | 84 |  |  | 9 |  |  | 20 |  |  | — |  |  | 113 |
Purchased product costs | 114 |  |  | — |  |  | — |  |  | — |  |  | 114 |
Rental cost of sales | 14 |  |  | 1 |  |  | — |  |  | — |  |  | 15 |
Rental cost of sales - related parties | — |  |  | 1 |  |  | — |  |  | — |  |  | 1 |
Purchases - related parties | 78 |  |  | 4 |  |  | 21 |  |  | (4 | ) |  | 99 |
Depreciation and amortization | 137 |  |  | 4 |  |  | 10 |  |  | — |  |  | 151 |
Impairment expense | 1 |  |  | — |  |  | — |  |  | — |  |  | 1 |
General and administrative expenses | 49 |  |  | 2 |  |  | 12 |  |  | — |  |  | 63 |
Other taxes | 11 |  |  | 1 |  |  | 1 |  |  | — |  |  | 13 |
Total costs and expenses | 488 |  |  | 22 |  |  | 64 |  |  | (4 | ) |  | 570 |
Income from operations | 76 |  |  | 16 |  |  | 36 |  |  | — |  |  | 128 |
Interest expense (net of amounts capitalized) | 52 |  |  | — |  |  | — |  |  | — |  |  | 52 |
Other financial costs | 12 |  |  | — |  |  | — |  |  | — |  |  | 12 |
Income before income taxes | 12 |  |  | 16 |  |  | 36 |  |  | — |  |  | 64 |
Benefit for income taxes | (8 | ) |  | — |  |  | — |  |  | — |  |  | (8 | )
Net income | 20 |  |  | 16 |  |  | 36 |  |  | — |  |  | 72 |
Less: Net income attributable to noncontrolling interests | 1 |  |  | — |  |  | — |  |  | — |  |  | 1 |
Less: Net income attributable to Predecessor | — |  |  | 16 |  |  | 36 |  |  | — |  |  | 52 |
Net income attributable to MPLX LP | 19 |  |  | — |  |  | — |  |  | — |  |  | 19 |
Less: Preferred unit distributions | 9 |  |  | — |  |  | — |  |  | — |  |  | 9 |
Less: General partner’s interest in net income attributable to MPLX LP | 46 |  |  | — |  |  | — |  |  | — |  |  | 46 |
Limited partners’ interest in net loss attributable to MPLX LP | $ | (36 | ) |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | (36 | )
(1) | Represents intercompany transactions eliminated during the consolidation process, in accordance with GAAP.
| Six Months Ended June 30, 2016
(In millions, except per unit data) | MPLX LP (Previously Reported) |  | HST/WHC |  | MPLXT |  | Eliminations(1) |  | MPLX LP (Currently Reported)
Revenues and other income: |  |  |  |  |  |  |  |  |
Service revenue | $ | 462 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 462 |
Service revenue - related parties | 295 |  |  | 54 |  |  | 74 |  |  | — |  |  | 423 |
Rental income | 141 |  |  | — |  |  | — |  |  | — |  |  | 141 |
Rental income - related parties | 55 |  |  | 23 |  |  | 26 |  |  | — |  |  | 104 |
Product sales | 237 |  |  | — |  |  | — |  |  | — |  |  | 237 |
Product sales - related parties | 6 |  |  | — |  |  | — |  |  | — |  |  | 6 |
Loss from equity method investments | (78 | ) |  | — |  |  | — |  |  | — |  |  | (78 | )
Other income | 3 |  |  | — |  |  | — |  |  | — |  |  | 3 |
Other income - related parties | 52 |  |  | — |  |  | — |  |  | (7 | ) |  | 45 |
Total revenues and other income | 1,173 |  |  | 77 |  |  | 100 |  |  | (7 | ) |  | 1,343 |
Costs and expenses: |  |  |  |  |  |  |  |  |
Cost of revenues (excludes items below) | 173 |  |  | 14 |  |  | 20 |  |  | — |  |  | 207 |
Purchased product costs | 193 |  |  | — |  |  | — |  |  | — |  |  | 193 |
Rental cost of sales | 28 |  |  | 1 |  |  | — |  |  | — |  |  | 29 |
Rental cost of sales - related parties | — |  |  | 1 |  |  | — |  |  | — |  |  | 1 |
Purchases - related parties | 154 |  |  | 9 |  |  | 21 |  |  | (7 | ) |  | 177 |
Depreciation and amortization | 269 |  |  | 8 |  |  | 10 |  |  | — |  |  | 287 |
Impairment expense | 130 |  |  | — |  |  | — |  |  | — |  |  | 130 |
General and administrative expenses | 101 |  |  | 3 |  |  | 12 |  |  | — |  |  | 116 |
Other taxes | 22 |  |  | 2 |  |  | 1 |  |  | — |  |  | 25 |
Total costs and expenses | 1,070 |  |  | 38 |  |  | 64 |  |  | (7 | ) |  | 1,165 |
Income from operations | 103 |  |  | 39 |  |  | 36 |  |  | — |  |  | 178 |
Related party interest and other financial income | 1 |  |  | — |  |  | — |  |  | — |  |  | 1 |
Interest expense (net of amounts capitalized) | 107 |  |  | — |  |  | — |  |  | — |  |  | 107 |
Other financial costs | 24 |  |  | — |  |  | — |  |  | — |  |  | 24 |
(Loss) income before income taxes | (29 | ) |  | 39 |  |  | 36 |  |  | — |  |  | 46 |
Benefit for income taxes | (12 | ) |  | — |  |  | — |  |  | — |  |  | (12 | )
Net (loss) income | (17 | ) |  | 39 |  |  | 36 |  |  | — |  |  | 58 |
Less: Net income attributable to noncontrolling interests | 1 |  |  | — |  |  | — |  |  | — |  |  | 1 |
Less: Net income attributable to Predecessor | 23 |  |  | 39 |  |  | 36 |  |  | — |  |  | 98 |
Net loss attributable to MPLX LP | (41 | ) |  | — |  |  | — |  |  | — |  |  | (41 | )
Less: Preferred unit distributions | 9 |  |  | — |  |  | — |  |  | — |  |  | 9 |
Less: General partner’s interest in net income attributable to MPLX LP | 85 |  |  | — |  |  | — |  |  | — |  |  | 85 |
Limited partners’ interest in net loss attributable to MPLX LP | $ | (135 | ) |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | (135 | )
(1) | Represents intercompany transactions eliminated during the consolidation process, in accordance with GAAP.
The following table presents the Partnership’s previously reported unaudited Consolidated Statements of Cash Flows, retrospectively adjusted for the acquisition of HST, WHC and MPLXT:
| Six Months Ended June 30, 2016
(In millions) | MPLX LP (Previously Reported) |  | HST/WHC |  | MPLXT |  | MPLX LP (Currently Reported)
Increase (decrease) in cash and cash equivalents |  |  |  |  |  |  |
Operating activities: |  |  |  |  |  |  |
Net (loss) income | $ | (17 | ) |  | $ | 39 |  |  | $ | 36 |  |  | $ | 58 |
Adjustments to reconcile net (loss) income to net cash provided by operating activities: |  |  |  |  |  |  |
Amortization of deferred financing costs | 23 |  |  | — |  |  | — |  |  | 23 |
Depreciation and amortization | 269 |  |  | 8 |  |  | 10 |  |  | 287 |
Impairment expense | 130 |  |  | — |  |  | — |  |  | 130 |
Deferred income taxes | (13 | ) |  | — |  |  | — |  |  | (13 | )
Asset retirement expenditures | (2 | ) |  | — |  |  | — |  |  | (2 | )
Loss from equity method investments | 78 |  |  | — |  |  | — |  |  | 78 |
Distributions from unconsolidated affiliates | 78 |  |  | — |  |  | — |  |  | 78 |
Changes in: |  |  |  |  |  |  |
Current receivables | (20 | ) |  | — |  |  | — |  |  | (20 | )
Inventories | (3 | ) |  | — |  |  | — |  |  | (3 | )
Fair value of derivatives | 25 |  |  | — |  |  | — |  |  | 25 |
Current accounts payable and accrued liabilities | 18 |  |  | (1 | ) |  | 2 |  |  | 19 |
Receivables from / liabilities to related parties | 6 |  |  | — |  |  | (18 | ) |  | (12 | )
All other, net | 21 |  |  | 3 |  |  | (2 | ) |  | 22 |
Net cash provided by operating activities | 593 |  |  | 49 |  |  | 28 |  |  | 670 |
Investing activities: |  |  |  |  |  |  |
Additions to property, plant and equipment | (569 | ) |  | (23 | ) |  | (14 | ) |  | (606 | )
Investments - net related party loans | 77 |  |  | (26 | ) |  | (14 | ) |  | 37 |
Investments in unconsolidated affiliates | (39 | ) |  | — |  |  | — |  |  | (39 | )
All other, net | 5 |  |  | — |  |  | — |  |  | 5 |
Net cash used in investing activities | (526 | ) |  | (49 | ) |  | (28 | ) |  | (603 | )
Financing activities: |  |  |  |  |  |  |
Long-term debt - borrowings | 434 |  |  | — |  |  | — |  |  | 434 |
- repayments | (1,311 | ) |  | — |  |  | — |  |  | (1,311 | )
Related party debt - borrowings | 1,853 |  |  | — |  |  | — |  |  | 1,853 |
- repayments | (1,861 | ) |  | — |  |  | — |  |  | (1,861 | )
Net proceeds from equity offerings | 321 |  |  | — |  |  | — |  |  | 321 |
Issuance of redeemable preferred units | 984 |  |  | — |  |  | — |  |  | 984 |
Distributions to unitholders and general partner | (391 | ) |  | — |  |  | — |  |  | (391 | )
Distributions to noncontrolling interests | (1 | ) |  | — |  |  | — |  |  | (1 | )
Contributions from noncontrolling interests | 2 |  |  | — |  |  | — |  |  | 2 |
All other, net | (1 | ) |  | — |  |  | — |  |  | (1 | )
Distributions to MPC from Predecessor | (104 | ) |  | — |  |  | — |  |  | (104 | )
Net cash used in financing activities | (75 | ) |  | — |  |  | — |  |  | (75 | )
Net decrease in cash and cash equivalents | (8 | ) |  | — |  |  | — |  |  | (8 | )
Cash and cash equivalents at beginning of period | 43 |  |  | — |  |  | — |  |  | 43 |
Cash and cash equivalents at end of period | $ | 35 |  |  | $ | — |  |  | $ | — |  |  | $ | 35 |
Acquisition of Ozark Pipeline On March 1, 2017, the Partnership acquired the Ozark pipeline from Enbridge Pipelines (Ozark) LLC for approximately $219 million, including purchase price adjustments made in the second quarter of 2017. Based on the preliminary fair value estimates of assets acquired and liabilities assumed at the acquisition date, the purchase price was primarily allocated to property, plant and equipment. The Ozark pipeline is a 433-mile, 22-inch crude oil pipeline originating in Cushing, Oklahoma, and terminating in Wood River, Illinois, capable of transporting approximately 230 mbpd. The Partnership accounts for the Ozark pipeline within its L&S segment. The amounts of revenue and income from operations associated with the acquisition included in the Consolidated Statements of Income, since the March 1, 2017 acquisition date, are as follows:
(In millions) | Three Months Ended June 30, 2017 |  | Four Months Ended June 30, 2017
Revenues and other income | $ | 19 |  |  | $ | 26 |
Income from operations | 9 |  |  | 11 |
Assuming the acquisition of the Ozark pipeline had occurred on January 1, 2016, the consolidated pro forma results would not have been materially different from reported results. Acquisition of Hardin Street Marine LLC On March 14, 2016, the Partnership entered into a Membership Interests Contribution Agreement (the “Contribution Agreement”) with MPLX GP, MPLX Logistics and MPC Investment, each a wholly-owned subsidiary of MPC, related to the acquisition of HSM, MPC’s inland marine business, from MPC. Pursuant to the Contribution Agreement, the transaction was valued at $600 million consisting of a fixed number of common units and general partner units of 22,534,002 and 459,878, respectively. The general partner units maintain MPC’s two percent GP Interest in the Partnership. The acquisition closed on March 31, 2016 and the fair value of the common units and general partner units issued was $669 million and $14 million, respectively, as recorded on the Consolidated Statements of Equity. MPC agreed to waive distributions in the first quarter of 2016 on MPLX LP common units issued in connection with this transaction. As a result of this waiver, MPC did not receive general partner distributions or incentive distribution rights that would have otherwise accrued on such MPLX LP common units with respect to the first quarter 2016 distributions. The value of these waived distributions was $15 million. The inland marine business, comprised of 18 tow boats and 219 owned and leased barges as of the acquisition date, which transport light products, heavy oils, crude oil, renewable fuels, chemicals and feedstocks in the Midwest and U.S. Gulf Coast regions, accounted for nearly 60 percent of the total volumes MPC shipped by inland marine vessels as of March 31, 2016. The Partnership accounts for HSM within its L&S segment.

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- Definition The entire disclosure for a business combination (or series of individually immaterial business combinations) completed during the period, including background, timing, and recognized assets and liabilities. The disclosure may include leverage buyout transactions (as applicable). + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -URI http://asc.fasb.org/topic&trid=2303972 + Details
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