18 unchanged sentences
In order to manage such price risks, we enter into commodity derivative instruments such as physical forward contracts, futures contracts, fixed-for-float swaps and basis swaps.
−Removed: The following table summarizes our portfolio of commodity derivative instruments outstanding at June 30, 2020 (volume measures as noted):
+Added: The following table summarizes our portfolio of commodity derivative instruments outstanding at September 30, 2020 (volume measures as noted):
Derivative Purpose
4 unchanged sentences
Cash flow hedge
−Removed: Forecasted sales of NGLs (MMBbls)
+Added: Forecasted sales of NGLs (million barrels (“MMBbls”)) (3)
Cash flow hedge
5 unchanged sentences
Natural gas marketing:
−Removed: Forecasted purchase of natural gas (Bcf)
−Removed: Cash flow hedge
Natural gas storage inventory management activities (Bcf)
22 unchanged sentences
Cash flow hedge
−Removed: Commercial energy:
−Removed: Forecasted purchases of power related to asset operations (terawatt hours (“TWh”))
−Removed: Cash flow hedge
Derivatives not designated as hedging instruments:
7 unchanged sentences
Mark-to-market
−Removed: Commercial energy risk management activities (TWh) (4)
−Removed: Mark-to-market
Volume for derivatives designated as hedging instruments reflects the total amount of volumes hedged whereas volume for derivatives not designated as hedging instruments reflects the absolute value of derivative notional volumes.
−Removed: The maximum term for derivatives designated as cash flow hedges, derivatives designated as fair value hedges and derivatives not designated as hedging instruments is December 2022, March 2021 and December 2022, respectively.
−Removed: Current volumes include approximately 0.7 Bcf of physical derivatives instruments that are predominantly priced as index plus a premium or minus a discount.
−Removed: Reflects the use of derivative instruments to manage risks associated with our transportation, processing, storage assets and end use power requirements.
−Removed: At June 30, 2020, our predominant commodity hedging strategies consisted of (i) hedging anticipated future purchases and sales of commodity products associated with transportation, storage and blending activities, (ii) hedging the fair value of commodity products held in inventory and (iii) hedging natural gas processing margins.
+Added: The maximum term for derivatives designated as cash flow hedges, derivatives designated as fair value hedges and derivatives not designated as hedging instruments is December 2022, December 2021 and December 2022, respectively.
+Added: Forecasted NGL sales volumes under natural gas processing exclude 0.3 MMBbls of additional hedges executed under contracts that have been designated as normal sales agreements.
+Added: Reflects the use of derivative instruments to manage risks associated with our transportation, processing and storage assets.
+Added: At September 30, 2020, our predominant commodity hedging strategies consisted of (i) hedging anticipated future purchases and sales of commodity products associated with transportation, storage and blending activities, (ii) hedging the fair value of commodity products held in inventory and (iii) hedging natural gas processing margins.
Sensitivity Analysis
7 unchanged sentences
Classification
+Added: September 30,
Fair value assuming no change in underlying commodity prices
7 unchanged sentences
Classification
+Added: September 30,
Fair value assuming no change in underlying commodity prices
7 unchanged sentences
Classification
+Added: September 30,
Fair value assuming no change in underlying commodity prices
4 unchanged sentences
Asset (Liability)
+Added: At September 30, 2020, our commodity hedging strategies exhibited in the stress test values were mainly attributable to contango positions in our NGL, refined products and crude oil marketing portfolios.
+Added: The decrease in fair value of our commodity hedging portfolios from September 30, 2020 to October 15, 2020 is primarily due to an increase in the underlying commodity prices.
+Added: In general, we expect that any loss on these derivative instruments would be offset by gains recognized at settlement on the physical transactions.
Interest Rate Hedging Activities
2 unchanged sentences
Sensitivity Analysis
−Removed: At June 30, 2020, our interest rate hedging portfolio consisted of forward-starting swaps.
+Added: At September 30, 2020, our interest rate hedging portfolio consisted of forward-starting swaps.
Forward-starting swaps hedge the risk of an increase in underlying benchmark interest rates during the period of time between the inception date of the swap agreement and the future date of a debt issuance.
1 unchanged sentence
With respect to the tabular data below, the portfolio’s estimated economic value at a given date is based on a number of factors, including the number and types of derivatives outstanding at that date, the notional value of the swaps and associated interest rates.
−Removed: The following table summarizes our portfolio of forward-starting swaps at June 30, 2020 (dollars in millions):
+Added: The following table summarizes our portfolio of forward-starting swaps at September 30, 2020 (dollars in millions):
Hedged Transaction
25 unchanged sentences
Classification
+Added: September 30,
Fair value assuming no change in underlying interest rates
4 unchanged sentences
Asset (Liability)
−Removed: The $ 254.1 million decrease in the fair value of this portfolio from December 31, 2019 to July 15, 2020 was primarily due to declining interest rates relative to the fixed rates specified in the swap agreements.
+Added: The increase in fair value of our interest rate hedging portfolio from September 30, 2020 to October 15, 2020 was primarily due to an increase in market interest rates relative to the fixed rates specified in the swap agreements.
Upon settlement, we would expect that any loss on these swaps would be offset by lower interest rates on future debt issuances.
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.