Debt Obligations

6 Months Ended

Jun. 30, 2021

Note 5 — Debt Obligations

	June 30, 2021			December 31, 2020
Current:
Obligations of the Partnership: (1)
Accounts receivable securitization facility, due April 2022 (2)	$	360.0		$	350.0
TPL notes, 4¾% fixed rate, due November 2021 (3)		—			6.5
		360.0			356.5
Finance lease liabilities		11.7			12.1
Current debt obligations		371.7			368.6

Long-term:
TRC obligations:
TRC Senior secured revolving credit facility, variable rate, due June 2023 (4)		—			555.0
Obligations of the Partnership: (1)
Senior secured revolving credit facility, variable rate, due June 2023 (5)		170.0			280.0
Senior unsecured notes:
4¼% fixed rate, due November 2023 (6)		—			583.9
5⅛% fixed rate, due February 2025		—			481.0
5⅞% fixed rate, due April 2026		963.2			963.2
5⅜% fixed rate, due February 2027		468.1			468.1
6½% fixed rate, due July 2027		705.2			705.2
5% fixed rate, due January 2028		700.3			700.3
6⅞% fixed rate, due January 2029		679.3			679.3
5½% fixed rate, due March 2030		949.6			949.6
4⅞% fixed rate, due February 2031		1,000.0			1,000.0
4% fixed rate, due January 2032		1,000.0			—
TPL notes, 5⅞% fixed rate, due August 2023 (3)		—			48.1
Unamortized premium		—			0.2
		6,635.7			7,413.9
Debt issuance costs, net of amortization		(47.6	)		(45.5	)
Finance lease liabilities		15.7			18.7
Long-term debt		6,603.8			7,387.1
Total debt obligations	$	6,975.5		$	7,755.7
Irrevocable standby letters of credit:
Letters of credit outstanding under the TRC Senior secured credit facility (4)	$	—		$	—
Letters of credit outstanding under the Partnership senior secured revolving credit facility (5)		48.8			44.4
	$	48.8		$	44.4

(1)	While we consolidate the debt of the Partnership in our financial statements, we do not have the obligation to make interest payments or debt payments with respect to the debt of the Partnership.

(2)

As of June 30, 2021, the Partnership had $360.0 million of qualifying receivables under its $400.0 million accounts receivable securitization facility (“Securitization Facility”), resulting in $40.0 million availability. During the second quarter of 2021, the Partnership amended the Securitization Facility to increase the facility size from $350.0 million to $400.0 million to more closely align with our expectation for borrowing needs given current commodity prices and to extend the facility termination date to April 21, 2022.

(3)	“TPL” refers to Targa Pipeline Partners LP.

(4)	As of June 30, 2021, availability under TRC’s $670.0 million senior secured revolving credit facility (“TRC Revolver”) was $670.0 million.

(5)	As of June 30, 2021, availability under the Partnership’s $2.2 billion senior secured revolving credit facility (“TRP Revolver”) was $1,981.2 million.

(6)	On May 17, 2021, the Partnership redeemed all of the remaining outstanding 4¼% Senior Notes due 2023.

The following table shows the range of interest rates and weighted average interest rate incurred on variable-rate debt obligations during the six months ended June 30, 2021:

	Range of Interest Rates Incurred	Weighted Average Interest Rate Incurred
TRC Revolver	1.9% - 1.9%	1.9%
TRP Revolver	1.8% - 1.9%	1.9%
Partnership's Securitization Facility	1.1% - 1.8%	1.5%

Compliance with Debt Covenants

As of June 30, 2021, we were in compliance with the covenants contained in our various debt agreements.

Senior Unsecured Notes Issuance and Redemptions

In February 2021, the Partnership issued $1.0 billion aggregate principal amount of 4% Senior Notes due 2032, resulting in net proceeds of approximately $991 million. The 4% Senior Notes due 2032 have substantially similar terms and covenants as our other series of Senior Notes. A portion of the net proceeds from the issuance were used to fund the concurrent cash tender offer (the “February Tender Offer”) and subsequent redemption payment for the Partnership’s 5⅛% Senior Notes due 2025 (the “5⅛% Notes”), with the remainder used for repayment of borrowings under the TRP Revolver and TRC Revolver. As a result of the February Tender Offer and the subsequent redemption of the 5⅛% Notes, we recorded a loss due to debt extinguishment of $14.9 million comprised of $12.5 million of premiums paid and a write-off of $2.4 million of debt issuance costs.

Additionally, TPL issued notices of redemption for all of the outstanding TPL 4¾% Senior Notes due 2021 and TPL 5⅞% Senior Notes due 2023 (collectively, the “TPL Notes”). These notes were redeemed on February 22, 2021 with available liquidity under the TRP Revolver. As a result of the redemptions of the TPL Notes, we recorded a gain due to debt extinguishment of $0.2 million.

In April 2021, the Partnership issued a notice of redemption for all of the outstanding 4¼% Senior Notes due 2023 (the “4¼% Senior Notes”). The notes were redeemed on May 17, 2021 with available liquidity under the TRP Revolver. As a result of the redemption of the 4¼% Senior Notes, we recorded a loss due to debt extinguishment of $1.9 million.

We or the Partnership may retire or purchase various series of the Partnership’s outstanding debt through cash purchases and/or exchanges for other debt, in open market purchases, privately negotiated transactions or otherwise. Such repurchases or exchanges, if any, will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors. The amounts involved may be material.

Contractual Obligations

The following table summarizes payment obligations for debt instruments after giving effect to the debt extinguishments detailed above:


	Payments Due By Period
			Less Than						More Than
	Total		1 Year		1-3 Years		3-5 Years		5 Years

Long-term debt obligations (1)	$	6,635.7	$	—	$	170.0	$	963.2	$	5,502.5
Interest on debt obligations (2)		2,645.5		363.5		713.8		688.8		879.4
	$	9,281.2	$	363.5	$	883.8	$	1,652.0	$	6,381.9

(1)	Represents scheduled future maturities of consolidated debt obligations for the periods indicated.

(2)	Represents interest expense on debt obligations based on both fixed debt interest rates and prevailing June 30, 2021 rates for floating debt.