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Partners' Capital and Distributions (Tables)

9 Months Ended

Sep. 30, 2012

Partners' Capital and Distributions

Total cash distributions paid or to be paid

The following table details the distributions paid during or pertaining to the first nine months of 2012, net of reductions to the general partner’s incentive distributions (in millions, except per unit amounts):

				Distributions Paid												Distributions
				Common			General Partner									per limited
Date Declared		Date Paid or To Be Paid		Units			Incentive			2%			Total			partner unit (2)
October 4, 2012		November 14, 2012 (1)		$	181		$	74		$	4		$	259		$	0.5425
July 9, 2012		August 14, 2012		$	174		$	69		$	4		$	247		$	0.5325
April 10, 2012		May 15, 2012		$	169		$	65		$	3		$	237		$	0.5225
January 10, 2012		February 14, 2012		$	159		$	63		$	3		$	225		$	0.5125

(1) Payable to unitholders of record at the close of business on November 2, 2012, for the period July 1, 2012 through September 30, 2012.

(2) Distributions per limited partner unit are presented as adjusted for the two-for-one unit split effected on October 1, 2012.

Equity offerings of common units

During the first nine months of 2012, we completed an offering of our common units that was not associated with our Continuous Offering Programs, as shown in the table below (in millions, except unit and per unit data):

										General
				Gross			Proceeds			Partner						Net
Date		Units Issued (2)		Unit Price (2)			from Sale			Contribution			Costs			Proceeds
March 2012 (1)		11,500,000		$	40.015		$	460		$	9		$	(14	)	$	455

(1) This offering of common units was an underwritten transaction that required us to pay a gross spread. The net proceeds from this offering were used to fund a portion of the BP NGL Acquisition, to reduce outstanding borrowings under our credit facilities and for general partnership purposes.

(2) Units issued and gross unit price are presented as adjusted for the two-for-one unit split that was effected on October 1, 2012.

Operational and financial benchmarks for conversion of the Series B subordinated units into Series A subordinated units

The following table presents the operational and financial benchmarks, as modified, for conversion of the Series B subordinated units into Series A subordinated units for each tranche (units in millions):

		Series B Subordinated Units to Convert into Series A Subordinated Units		Working Gas Storage Capacity (Bcf)		Annualized Distribution Level (1)
Tranche 1		2.6		29.6		$	1.71
Tranche 2		2.8		35.6		$	1.71
Tranche 3		2.1		41.6		$	1.71
Tranche 4		3.0		48.0		$	1.71
Tranche 5		3.0		48.0		$	1.80

(1) For satisfaction of this benchmark, PNG must, for two consecutive quarters, (i) generate distributable cash flow sufficient to pay a quarterly distribution of at least the annualized distribution benchmark on the weighted average number of common units and Series A subordinated units and all of such Series B subordinated units outstanding during such quarter plus (ii) distribute available cash of at least the annualized distribution benchmark on all of its outstanding common units and Series A subordinated units and the corresponding distributions on PNG’s general partner’s 2% interest and the related distributions on the incentive distribution rights. See Note 5 to our Consolidated Financial Statements included in Part IV of our 2011 Annual Report on Form 10-K for a complete discussion of PNG’s Series B subordinated units.

Schedule of changes in noncontrolling interests in partners' capital

The following table reflects the changes in the noncontrolling interests in partners’ capital (in millions):

		Nine Months Ended
		September 30,
		2012			2011
Beginning balance		$	524		$	231
Sale of noncontrolling interests in a subsidiary		—			306
Net income attributable to noncontrolling interests		23			18
Distributions to noncontrolling interests		(36		)	(28		)
Equity compensation expense		3			2
Distribution equivalent right payments		(1		)	—
Other comprehensive income/(loss):
Reclassification adjustments		(7		)	—
Net deferred loss on cash flow hedges		(1		)	—
Ending balance		$	505		$	529