What changed in this filing

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Item 1. Financial Statements

2024-11-08 compared with 2024-08-09 · 237 added, 204 removed, 1136 unchanged (28% of the section changed)

3 unchanged sentences

(Dollars in millions)

September 30,

Current assets:

2 unchanged sentences

Accounts receivable – trade, net of allowance for credit losses

of $ 37 at June 30, 2024 and $ 35 at December 31, 2023

of $ 38 at September 30, 2024 and $ 35 at December 31, 2023

Accounts receivable – related parties

23 unchanged sentences

Series A cumulative convertible preferred units (“preferred units”)

( 50,502 units outstanding at June 30, 2024 and 50,412 units outstanding at

( 50,594 units outstanding at September 30, 2024 and 50,412 units outstanding at

December 31, 2023 )

1 unchanged sentence

Common limited partner interests ( 2,167,752,040 units issued and outstanding at

June 30, 2024 , 2,168,245,238 units issued and outstanding at December 31, 2023 )

September 30, 2024 , 2,168,245,238 units issued and outstanding at December 31, 2023 )

Treasury units, at cost

8 unchanged sentences

For the Three Months

Ended June 30,

For the Six Months

Ended June 30,

Ended September 30,

For the Nine Months

Ended September 30,

Third parties

32 unchanged sentences

For the Three Months

Ended June 30,

For the Six Months

Ended June 30,

Ended September 30,

For the Nine Months

Ended September 30,

Other comprehensive income (loss):

3 unchanged sentences

Changes in fair value of cash flow hedges

Reclassificatio n of gains to ne t income

Reclassificatio n of losses ( gains) to ne t income

Interest rate hedging derivative instruments:

11 unchanged sentences

(Dollars in millions)

For the Six Months

Ended June 30,

For the Nine Months

Ended September 30,

Operating activities:

8 unchanged sentences

Net losses (gains) attributable to asset sales and related matters

Deferred income tax expense (benefit)

Deferred income tax expense

Change in fair market value of derivative instruments

5 unchanged sentences

Capital expenditures

Investments in unconsolidated affiliates

Distributions received from unconsolidated affiliates attributable to the return of capital

21 unchanged sentences

UNAUDITED CONDENSED STATEMENTS OF CONSOLIDATED EQUITY

FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2024

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2024

(Dollars in millions)

3 unchanged sentences

Noncontrolling

For the Three Months Ended June 30, 2024 :

Balance March 31, 2024

For the Three Months Ended September 30, 2024 :

Balance June 30, 2024

Cash distributions paid to common unitholders

7 unchanged sentences

Cash flow hedges

Balance, June 30, 2024

Balance, September 30, 2024

Partners’ Equity

2 unchanged sentences

Noncontrolling

For the Six Months Ended June 30, 2024 :

For the Nine Months Ended September 30, 2024 :

Balance, December 31, 2023

9 unchanged sentences

Cash flow hedges

Balance, June 30, 2024

Balance, September 30, 2024

See Notes to Unaudited Condensed Consolidated Financial Statements.

3 unchanged sentences

UNAUDITED CONDENSED STATEMENTS OF CONSOLIDATED EQUITY

FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2023

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2023

(Dollars in millions)

3 unchanged sentences

Noncontrolling

For the Three Months Ended June 30, 2023 :

Balance, March 31, 2023

For the Three Months Ended September 30, 2023 :

Balance, June 30, 2023

Cash distributions paid to common unitholders

3 unchanged sentences

Cash contributions from noncontrolling interests

Repurchase and cancellation of common units under

2019 Buyback Program

Amortization of fair value of equity-based awards

Acquisition of noncontrolling interests

Cash flow hedges

Balance, June 30, 2023

Balance, September 30, 2023

Partners’ Equity

2 unchanged sentences

Noncontrolling

For the Six Months Ended June 30, 2023 :

For the Nine Months Ended September 30, 2023 :

Balance, December 31, 2022

9 unchanged sentences

Cash flow hedges

Balance, June 30, 2023

Balance, September 30, 2023

See Notes to Unaudited Condensed Consolidated Financial Statements.

27 unchanged sentences

We, Enterprise GP, EPCO and Dan Duncan LLC are affiliates under the collective common control of the DD LLC Trustees and the EPCO Trustees.

EPCO, together with its privately held affiliates, owned approximately 32.3 % of the Partnership’s common units outstanding at June 30, 2024.

EPCO, together with its privately held affiliates, owned approximately 32.4 % of the Partnership’s common units outstanding at September 30, 2024.

With the exception of per unit amounts, or as noted within the context of each disclosure,

21 unchanged sentences

See Note 14 for information regarding related party matters.

Our results of operations for the six months ended June 30, 2024 are not necessarily indicative of results expected for the full year of 2024.

Our results of operations for the nine months ended September 30, 2024 are not necessarily indicative of results expected for the full year of 2024.

In our opinion, the accompanying Unaudited Condensed Consolidated Financial Statements include all adjustments consisting of normal recurring accruals necessary for fair presentation.

9 unchanged sentences

The following table provides a reconciliation of cash and cash equivalents, and restricted cash reported within the Unaudited Condensed Consolidated Balance Sheets that sum to the total of the amounts shown in the Unaudited Condensed Statements of Consolidated Cash Flows.

September 30,

Cash and cash equivalents

6 unchanged sentences

Our inventory amounts by product type were as follows at the dates indicated:

September 30,

Petrochemicals and refined products

2 unchanged sentences

For the Three Months

Ended June 30,

For the Six Months

Ended June 30,

Ended September 30,

For the Nine Months

Ended September 30,

Cost of sales (1)

7 unchanged sentences

The historical costs of our property, plant and equipment and related balances were as follows at the dates indicated:

September 30,

Plants, pipelines and facilities (1)(5)

32 unchanged sentences

On a weighted-average basis, the expected remaining amortization period for these costs is 3.6 years.

Property, plant and equipment at June 30, 2024 and December 31, 2023 includes $ 134 million and $ 109 million, respectively, of asset retirement costs capitalized as an increase in the associated long-lived asset.

Property, plant and equipment at September 30, 2024 and December 31, 2023 includes $ 135 million and $ 109 million, respectively, of asset retirement costs capitalized as an increase in the associated long-lived asset.

The following table presents information regarding our asset retirement obligations, or AROs, since December 31, 2023:

4 unchanged sentences

Accretion expense (4)

ARO liability balance, June 30, 2024

ARO liability balance, September 30, 2024

Represents the initial recognition of estimated ARO liabilities during the period.

2 unchanged sentences

Represents the net change in ARO liability balance attributable to the passage of time and other adjustments, including true-up amounts associated with revised closure estimates.

Of the $ 257 million total ARO liability recorded at June 30, 2024 , $ 6 million was reflected as a current liability and $ 251 million as a long-term liability.

Of the $ 261 million total ARO liability recorded at September 30, 2024 , $ 6 million was reflected as a current liability and $ 255 million as a long-term liability.

ENTERPRISE PRODUCTS PARTNERS L.P.

2 unchanged sentences

For the Three Months

Ended June 30,

For the Six Months

Ended June 30,

Ended September 30,

For the Nine Months

Ended September 30,

Depreciation expense (1)

7 unchanged sentences

We account for these investments using the equity method.

September 30,

NGL Pipelines & Services

4 unchanged sentences

For the Three Months

Ended June 30,

For the Six Months

Ended June 30,

Ended September 30,

For the Nine Months

Ended September 30,

NGL Pipelines & Services

7 unchanged sentences

The following table summarizes our intangible assets by business segment at the dates indicated:

June 30, 2024

September 30, 2024

December 31, 2023

18 unchanged sentences

For the Three Months

Ended June 30,

For the Six Months

Ended June 30,

Ended September 30,

For the Nine Months

Ended September 30,

NGL Pipelines & Services

9 unchanged sentences

The following table presents our consolidated debt obligations (arranged by company and maturity date) at the dates indicated:

September 30,

EPO senior debt obligations:

15 unchanged sentences

Senior Notes H, 6.65 % fixed-rate, due October 2034

Senior Notes JJJ 4.95 % fixed-rate, due February 2035

Senior Notes J, 5.75 % fixed-rate, due March 2035

16 unchanged sentences

Senior Notes NN, 4.95 % fixed-rate, due October 2054

Senior Notes KKK, 5.55 % fixed-rate, due February 2055

Senior Notes CCC, 3.95 % fixed-rate, due January 2060

23 unchanged sentences

Variable Interest Rates

The following table presents the range of interest rates and weighted-average interest rates paid on our consolidated variable-rate debt during the six months ended June 30, 2024:

The following table presents the range of interest rates and weighted-average interest rates paid on our consolidated variable-rate debt during the nine months ended September 30, 2024:

Range of Interest

12 unchanged sentences

Scheduled Maturities of Debt

The following table presents the scheduled maturities of principal amounts of EPO’s consolidated debt obligations at June 30, 2024 for the next five years, and in total thereafter:

The following table presents the scheduled maturities of principal amounts of EPO’s consolidated debt obligations at September 30, 2024 for the next five years, and in total thereafter:

Scheduled Maturities of Debt

Commercial Paper Notes

Junior Subordinated Notes

2 unchanged sentences

There were no principal amounts outstanding under the prior 364-day revolving credit agreement when it was replaced by the March 2024 $1.5 Billion 364-Day Revolving Credit Agreement.

As of June 30, 2024, there were no principal amounts outstanding under the March 2024 $1.5 Billion 364-Day Revolving Credit Agreement.

As of September 30, 2024, there were no principal amounts outstanding under the March 2024 $1.5 Billion 364-Day Revolving Credit Agreement.

Under the terms of the March 2024 $1.5 Billion 364-Day Revolving Credit Agreement, EPO may borrow up to $ 1.5 billion (which may be increased by up to $ 200 million to $ 1.7 billion at EPO’s election, provided certain conditions are met) at a variable interest rate for a term of up to 364 days, subject to the terms and conditions set forth therein.

14 unchanged sentences

The Partnership guaranteed these senior notes through an unconditional guarantee on an unsecured and unsubordinated basis.

Issuance of $2.5 Billion of Senior Notes in August 2024

In August 2024, EPO issued $ 2.5 billion aggregate principal amount of senior notes comprised of (i) $ 1.1 billion principal amount of senior notes due February 2035 (“Senior Notes JJJ”) and (ii) $ 1.4 billion principal amount of senior notes due February 2055 (“Senior Notes KKK”).

Net proceeds from this offering will be used by EPO for general company purposes, including for growth capital investments, and the repayment of debt (including the repayment of all or a portion of our $ 1.15 billion principal amount of 3.75 % Senior Notes MM at their maturity in February 2025).

Senior Notes JJJ were issued at 99.400 % of their principal amount and have a fixed interest rate of 4.95 % per year.

Senior Notes KKK were issued at 99.663 % of their principal amount and have a fixed interest rate of 5.55 % per year.

The Partnership guaranteed these senior notes through an unconditional guarantee on an unsecured and unsubordinated basis.

Letters of Credit

At June 30, 2024, EPO had $ 22 million of letters of credit outstanding primarily related to our insurance program.

At September 30, 2024, EPO had $ 28 million of letters of credit outstanding primarily related to our insurance program.

Lender Financial Covenants

We were in compliance with the financial covenants of our consolidated debt agreements at June 30, 2024.

We were in compliance with the financial covenants of our consolidated debt agreements at September 30, 2024.

Parent-Subsidiary Guarantor Relationships

1 unchanged sentence

If EPO were to default on any of its guaranteed debt, the Partnership would be responsible for full and unconditional repayment of such obligations.

ENTERPRISE PRODUCTS PARTNERS L.P.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Capital Accounts

11 unchanged sentences

2,170,301,640

Common unit repurchases under 2019 Buyback Program

Common units issued in connection with the vesting of phantom unit awards, net

Common units outstanding at September 30, 2024

2,167,752,040

Registration Statements

We have a universal shelf registration statement on file with the SEC which allows the Partnership and EPO (each on a standalone basis) to issue an unlimited amount of equity and debt securities, respectively.

We have a universal shelf registration statement (the “2021 Shelf”) on file with the SEC which allows the Partnership and EPO (each on a standalone basis) to issue an unlimited amount of equity and debt securities, respectively.

The 2021 Shelf will expire in November 2024, at which time we expect to file a replacement universal shelf registration statement.

In addition, the Partnership has a registration statement on file with the SEC covering the issuance of up to $ 2.5 billion of its common units in amounts, at prices and on terms based on market conditions and other factors at the time of such offerings (referred to as the Partnership’s at-the-market (“ATM”) program).

The Partnership did not issue any common units under its ATM program during the six months ended June 30, 2024 .

The Partnership’s capacity to issue additional common units under the ATM program remains at $ 2.5 billion as of June 30, 2024.

The Partnership did not issue any common units under its ATM program during the nine months ended September 30, 2024 .

The Partnership’s capacity to issue additional common units under the ATM program remains at $ 2.5 billion as of September 30, 2024.

We may issue additional equity and debt securities to assist us in meeting our future liquidity requirements, including those related to capital investments.

ENTERPRISE PRODUCTS PARTNERS L.P.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Common Unit Repurchases Under 2019 Buyback Program

2 unchanged sentences

No time limit has been set for completion of the program, and it may be suspended or discontinued at any time.

During the three and six months ended June 30, 2024, the Partnership repurchased 1,419,581 and 2,806,416 common units, respectively, under the 2019 Buyback Program through open market purchases.

The total cost of these repurchases, including commissions and fees, was $ 40 million and $ 80 million, respectively.

During the three and six months ended June 30, 2023 , the Partnership repurchased 2,910,121 and 3,592,710 common units, respectively, under the 2019 Buyback Program through open market purchases.

During the three and nine months ended September 30, 2024, the Partnership repurchased 2,646,351 and 5,452,767 common units, respectively, under the 2019 Buyback Program through open market purchases.

The total cost of these repurchases, including commissions and fees, was $ 76 million and $ 156 million, respectively.

The Partnership elected not to repurchase common units during the three months ended September 30, 2023.

During the nine months ended September 30, 2023 , the Partnership repurchased 3,592,710 common units under the 2019 Buyback Program through open market purchases.

The total cost of these repurchases, including commissions and fees, was $ 92 million.

Common units repurchased under the 2019 Buyback Program are immediately cancelled upon acquisition.

At June 30, 2024, the remaining available capacity under the 2019 Buyback Program was $ 1.0 billion.

At September 30, 2024, the remaining available capacity under the 2019 Buyback Program was $ 926 million.

Common Units Issued in Connection With the Vesting of Phantom Unit Awards

After taking into account tax withholding requirements, the Partnership issued 4,842,244 new common units to employees in connection with the vesting of phantom unit awards during the six months ended June 30, 2024.

After taking into account tax withholding requirements, the Partnership issued 4,938,995 new common units to employees in connection with the vesting of phantom unit awards during the nine months ended September 30, 2024.

See Note 12 for information regarding our phantom unit awards.

ENTERPRISE PRODUCTS PARTNERS L.P.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Common Units Delivered Under DRIP and EUPP

2 unchanged sentences

This election is subject to change in future quarters depending on the Partnership’s need for equity capital.

During the six months ended June 30, 2024 , agents of the Partnership purchased 3,364,678 common units on the open market and delivered them to participants in the DRIP and EUPP.

During the nine months ended September 30, 2024 , agents of the Partnership purchased 4,971,186 common units on the open market and delivered them to participants in the DRIP and EUPP.

Apart from $ 3 million attributable to the plan discount available to all participants in the EUPP, the funds used to effect these purchases were sourced from the DRIP and EUPP participants.

No other Partnership funds were used to satisfy these obligations.

We plan to use open market purchases to satisfy DRIP and EUPP reinvestments in connection with the distribution expected to be paid on August 14, 2024.

We plan to use open market purchases to satisfy DRIP and EUPP reinvestments in connection with the distribution expected to be paid on November 14, 2024.

Preferred Units

3 unchanged sentences

Preferred units outstanding at June 30, 2024

Paid in-kind distribution to third party

Preferred units outstanding at September 30, 2024

We present the capital accounts attributable to our preferred unitholders as mezzanine equity on our consolidated balance sheets since the terms of the preferred units allow for cash redemption by such unitholders in the event of a Change of Control (as defined in our partnership agreement), without regard to the likelihood of such an event.

During the six months ended June 30, 2024, the Partnership made quarterly cash distributions to its preferred unitholders of $ 2 million and paid-in-kind distributions of 90 new preferred units valued at less than $1 million.

ENTERPRISE PRODUCTS PARTNERS L.P.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

During the nine months ended September 30, 2024, the Partnership made quarterly cash distributions to its preferred unitholders of $ 3 million and paid-in-kind distributions of 182 new preferred units valued at less than $1 million.

Accumulated Other Comprehensive Income (Loss)

6 unchanged sentences

Total other comprehensive income (loss) for period

Accumulated Other Comprehensive Income (Loss), June 30, 2024

Accumulated Other Comprehensive Income (Loss), September 30, 2024

Cash Flow Hedges

4 unchanged sentences

Total other comprehensive income (loss) for period

Accumulated Other Comprehensive Income (Loss), June 30, 2023

Accumulated Other Comprehensive Income (Loss), September 30, 2023

ENTERPRISE PRODUCTS PARTNERS L.P.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The following table presents reclassifications of losses (gains) out of accumulated other comprehensive income into net income during the periods indicated:

For the Three Months

Ended June 30,

For the Six Months

Ended June 30,

Ended September 30,

For the Nine Months

Ended September 30,

Losses (gains) on cash flow hedges:

13 unchanged sentences

Since we had a controlling interest in each of these entities before and after the acquisitions, the increase in our ownership interest in each entity was accounted for as an equity transaction with no gain or loss recognized.

ENTERPRISE PRODUCTS PARTNERS L.P.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Cash Distributions

On July 10, 2024, we announced that the Board declared a quarterly cash distribution of $ 0.525 per common unit, or $ 2.10 per common unit on an annualized basis, to be paid to the Partnership’s common unitholders with respect to the second quarter of 2024.

The quarterly distribution is payable on August 14, 2024 to unitholders of record as of the close of business on July 31, 2024.

On October 2 , 2024, we announced that the Board declared a quarterly cash distribution of $ 0.525 per common unit, or $ 2.10 per common unit on an annualized basis, to be paid to the Partnership’s common unitholders with respect to the third quarter of 2024.

The quarterly distribution is payable on November 14 , 2024 to unitholders of record as of the close of business on October 31, 2024.

The total amount to be paid is $ 1.15 billion, which includes $ 11 million for distribution equivalent rights (“DERs”) on phantom unit awards.

1 unchanged sentence

Management will evaluate any future increases in cash distributions on a quarterly basis.

ENTERPRISE PRODUCTS PARTNERS L.P.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

We classify our revenues into sales of products and midstream services.

2 unchanged sentences

For the Three Months

Ended June 30,

For the Six Months

Ended June 30,

Ended September 30,

For the Nine Months

Ended September 30,

NGL Pipelines & Services:

32 unchanged sentences

Unbilled Revenue and Deferred Revenue

The following table provides information regarding our contract assets and contract liabilities at June 30, 2024:

The following table provides information regarding our contract assets and contract liabilities at September 30, 2024:

Contract Asset

6 unchanged sentences

Other long-term liabilities

The following table presents significant changes in our unbilled revenue and deferred revenue balances for the six months ended June 30, 2024:

The following table presents significant changes in our unbilled revenue and deferred revenue balances for the nine months ended September 30, 2024:

Balance at December 31, 2023

3 unchanged sentences

Other changes

Balance at June 30, 2024

Balance at September 30, 2024

Unbilled revenues are transferred to accounts receivable once we have an unconditional right to consideration from the customer.

4 unchanged sentences

The following table presents estimated fixed future consideration from revenue contracts that contain minimum volume commitments, deficiency and similar fees and the term of the contracts exceeds one year.

These amounts represent the revenues we expect to recognize in future periods from these contracts as of June 30, 2024.

These amounts represent the revenues we expect to recognize in future periods from these contracts as of September 30, 2024.

Consideration

Six Months Ended December 31, 2024

Three Months Ended December 31, 2024

One Year Ended December 31, 2025

31 unchanged sentences

For the Three Months

Ended June 30,

For the Six Months

Ended June 30,

Ended September 30,

For the Nine Months

Ended September 30,

Operating income

15 unchanged sentences

For the Three Months

Ended June 30,

For the Six Months

Ended June 30,

Ended September 30,

For the Nine Months

Ended September 30,

Gross operating margin by segment:

11 unchanged sentences

Revenues from third parties:

Three months ended June 30, 2024

Three months ended June 30, 2023

Six months ended June 30, 2024

Six months ended June 30, 2023

Three months ended September 30, 2024

Three months ended September 30, 2023

Nine months ended September 30, 2024

Nine months ended September 30, 2023

Revenues from related parties:

Three months ended June 30, 2024

Three months ended June 30, 2023

Six months ended June 30, 2024

Six months ended June 30, 2023

Three months ended September 30, 2024

Three months ended September 30, 2023

Nine months ended September 30, 2024

Nine months ended September 30, 2023

Intersegment and intrasegment revenues:

Three months ended June 30, 2024

Three months ended June 30, 2023

Six months ended June 30, 2024

Six months ended June 30, 2023

Three months ended September 30, 2024

Three months ended September 30, 2023

Nine months ended September 30, 2024

Nine months ended September 30, 2023

Total revenues:

Three months ended June 30, 2024

Three months ended June 30, 2023

Six months ended June 30, 2024

Six months ended June 30, 2023

Three months ended September 30, 2024

Three months ended September 30, 2023

Nine months ended September 30, 2024

Nine months ended September 30, 2023

Equity in income of unconsolidated affiliates:

Three months ended June 30, 2024

Three months ended June 30, 2023

Six months ended June 30, 2024

Six months ended June 30, 2023

Three months ended September 30, 2024

Three months ended September 30, 2023

Nine months ended September 30, 2024

Nine months ended September 30, 2023

Segment revenues include intersegment and intrasegment transactions, which are generally based on transactions made at market-based rates.

6 unchanged sentences

Property, plant and equipment, net:

At June 30, 2024

At September 30, 2024

At December 31, 2023

Investments in unconsolidated affiliates:

At June 30, 2024

At September 30, 2024

At December 31, 2023

Intangible assets, net:

At June 30, 2024

At September 30, 2024

At December 31, 2023

At June 30, 2024

At September 30, 2024

At December 31, 2023

Segment assets:

At June 30, 2024

At September 30, 2024

At December 31, 2023

4 unchanged sentences

For the Three Months

Ended June 30,

For the Six Months

Ended June 30,

Ended September 30,

For the Nine Months

Ended September 30,

Consolidated revenues:

26 unchanged sentences

For the Three Months

Ended June 30,

For the Six Months

Ended June 30,

Ended September 30,

For the Nine Months

Ended September 30,

BASIC EARNINGS PER COMMON UNIT

22 unchanged sentences

For the Three Months

Ended June 30,

For the Six Months

Ended June 30,

Ended September 30,

For the Nine Months

Ended September 30,

Equity-classified awards:

11 unchanged sentences

Phantom unit awards at December 31, 2023

Phantom unit awards at June 30, 2024

Phantom unit awards at September 30, 2024

Determined by dividing the aggregate grant date fair value of awards (before an allowance for forfeitures) by the number of awards issued.

6 unchanged sentences

For the Three Months

Ended June 30,

For the Six Months

Ended June 30,

Ended September 30,

For the Nine Months

Ended September 30,

Cash payments made in connection with DERs

Total intrinsic value of phantom unit awards that vested during period

For the EPCO group of companies, the unrecognized compensation cost associated with phantom unit awards was $ 295 million at June 30, 2024, of which our share of such cost is currently estimated to be $ 241 million.

For the EPCO group of companies, the unrecognized compensation cost associated with phantom unit awards was $ 244 million at September 30, 2024, of which our share of such cost is currently estimated to be $ 196 million.

Due to the graded vesting provisions of these awards, we expect to recognize our share of the unrecognized compensation cost for these awards over a weighted-average period of 2.1 years.

3 unchanged sentences

As a result of these vesting events, we recognized an incremental $ 7 million of non-cash compensation expense in the three months ended March 31, 2024.

ENTERPRISE PRODUCTS PARTNERS L.P.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Hedging Activities and Fair Value Measurements

2 unchanged sentences

Substantially all of our derivatives are used for non-trading activities.

ENTERPRISE PRODUCTS PARTNERS L.P.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Interest Rate Hedging Activities

8 unchanged sentences

The purpose of these transactions was to hedge the underlying interest rate risk associated with debt issuances that occurred in January 2024 (see Note 7).

In January 2024, we terminated all of the treasury lock transactions simultaneously with our issuance of the three-year and ten-year notes and made total cash payments of $ 29 million.

In January 2024, we terminated these treasury lock transactions simultaneously with our issuance of the three-year and ten-year notes and made total cash payments of $ 29 million.

In August 2024, we entered into two treasury lock transactions to fix the ten-year treasury rate at 3.98 % on a notional amount of $ 1.0 billion and to fix the thirty-year treasury rate at 4.29 % on a notional amount of $ 1.0 billion.

The purpose of these transactions was to hedge the underlying interest rate risk associated with debt issuances that occurred in August 2024 (see Note 7).

In August 2024, we terminated these treasury lock transactions simultaneously with our issuance of the ten-year and thirty-year notes and made total cash payments of $ 4 million.

As cash flow hedges, losses on these derivative instruments are reflected as a component of accumulated other comprehensive income and will be amortized to earnings as a component of interest expense over the full term of each issuance.

2 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.

At June 30, 2024 , 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 natural gas processing margins, (iii) hedging the fair value of commodity products held in inventory and (iv) hedging anticipated future purchases of power for certain operations in Southeast Texas .

At September 30, 2024 , 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 natural gas processing margins, (iii) hedging the fair value of commodity products held in inventory and (iv) hedging anticipated future purchases of power for certain operations in Southeast Texas .

The objective of our anticipated future commodity purchases and sales hedging program is to hedge the margins of certain transportation, storage, blending and operational activities by locking in purchase and sale prices through the use of derivative instruments and related contracts.

6 unchanged sentences

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The following table summarizes our portfolio of commodity derivative instruments outstanding at June 30, 2024 (volume measures as noted):

The following table summarizes our portfolio of commodity derivative instruments outstanding at September 30, 2024 (volume measures as noted):

Derivative Purpose

12 unchanged sentences

Natural gas marketing:

Forecasted purchases of natural gas (Bcf)

Cash flow hedge

Natural gas storage inventory management activities (Bcf)

15 unchanged sentences

Cash flow hedge

Petrochemical marketing:

Forecasted purchases of petrochemical products (MMBbls)

Cash flow hedge

Forecasted sales of petrochemical products (MMBbls)

Cash flow hedge

Commercial energy:

10 unchanged sentences

Mark-to-market

Petrochemical risk management activities (MMBbls) (3)

Commercial energy risk management activities (TWh) (3)

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.

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 2027, December 2024 and December 2027, respectively.

Reflects the use of derivative instruments to manage risks associated with our transportation, processing and storage assets.

The carrying amount of our inventories subject to fair value hedges was $ 6 million and $ 2 million at June 30, 2024 and December 31, 2023, respectively.

The carrying amount of our inventories subject to fair value hedges was $ 3 million and $ 2 million at September 30, 2024 and December 31, 2023, respectively.

ENTERPRISE PRODUCTS PARTNERS L.P.

5 unchanged sentences

Liability Derivatives

June 30, 2024

September 30, 2024

December 31, 2023

June 30, 2024

September 30, 2024

December 31, 2023

25 unchanged sentences

(v) = (iii) + (iv)

As of June 30, 2024:

As of September 30, 2024:

Commodity derivatives

11 unchanged sentences

(v) = (iii) + (iv)

As of June 30, 2024:

As of September 30, 2024:

Commodity derivatives

14 unchanged sentences

For the Three Months

Ended June 30,

For the Six Months

Ended June 30,

Ended September 30,

For the Nine Months

Ended September 30,

Commodity derivatives

4 unchanged sentences

For the Three Months

Ended June 30,

For the Six Months

Ended June 30,

Ended September 30,

For the Nine Months

Ended September 30,

Commodity derivatives

7 unchanged sentences

For the Three Months

Ended June 30,

For the Six Months

Ended June 30,

Ended September 30,

For the Nine Months

Ended September 30,

Interest rate derivatives

7 unchanged sentences

For the Three Months

Ended June 30,

For the Six Months

Ended June 30,

Ended September 30,

For the Nine Months

Ended September 30,

Interest rate derivatives

6 unchanged sentences

Over the next twelve months, we expect to reclassify $ 6 million of gains attributable to interest rate derivative instruments from accumulated other comprehensive income to earnings as a decrease in interest expense.

Likewise, we expect to reclassify $ 20 million of net gains attributable to commodity derivative instruments from accumulated other comprehensive income to earnings, with $ 3 million as an increase in revenue and $ 17 million as a decrease in operating costs and expenses.

Likewise, we expect to reclassify $ 125 million of net gains attributable to commodity derivative instruments from accumulated other comprehensive income to earnings, with $ 139 million as an increase in revenue and $ 14 million as an increase in operating costs and expenses.

The following table presents the effect of our derivative instruments not designated as hedging instruments on our Unaudited Condensed Statements of Consolidated Operations for the periods indicated:

4 unchanged sentences

For the Three Months

Ended June 30,

For the Six Months

Ended June 30,

Ended September 30,

For the Nine Months

Ended September 30,

Commodity derivatives

1 unchanged sentence

Operating costs and expenses

The $ 7 million net gain recognized for the six months ended June 30, 2024 (as noted in the preceding table) from derivatives not designated as hedging instruments consists of $ 3 million of net realized gains and $ 4 million of net unrealized mark-to-market gains attributable to commodity derivatives.

The $ 10 million net loss recognized for the nine months ended September 30, 2024 (as noted in the preceding table) from derivatives not designated as hedging instruments consists of $ 16 million of net realized losses and $ 6 million of net unrealized mark-to-market gains attributable to commodity derivatives.

Fair Value Measurements

8 unchanged sentences

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

At June 30, 2024

At September 30, 2024

Fair Value Measurements Using

28 unchanged sentences

Total commodity derivatives

In the aggregate, the fair value of our commodity hedging portfolios at June 30, 2024 was a net derivative asset of $ 27 million prior to the impact of CME Rule 814.

Financial assets and liabilities recorded on the balance sheet at June 30, 2024 using significant unobservable inputs (Level 3) are not material to the Unaudited Condensed Consolidated Financial Statements.

In the aggregate, the fair value of our commodity hedging portfolios at September 30, 2024 was a net derivative asset of $ 138 million prior to the impact of CME Rule 814.

Financial assets and liabilities recorded on the balance sheet at September 30, 2024 using significant unobservable inputs (Level 3) are not material to the Unaudited Condensed Consolidated Financial Statements.

ENTERPRISE PRODUCTS PARTNERS L.P.

2 unchanged sentences

The carrying amounts of cash and cash equivalents (including restricted cash balances), accounts receivable, commercial paper notes and accounts payable approximate their fair values based on their short-term nature.

The estimated total fair value of our fixed-rate debt obligations was $ 26.5 billion and $ 26.7 billion at June 30, 2024 and December 31, 2023, respectively.

The aggregate carrying value of these debt obligations was $ 29.1 billion and $ 28.0 billion at June 30, 2024 and December 31, 2023, respectively.

The estimated total fair value of our fixed-rate debt obligations was $ 30.4 billion and $ 26.7 billion at September 30, 2024 and December 31, 2023, respectively.

The aggregate carrying value of these debt obligations was $ 31.6 billion and $ 28.0 billion at September 30, 2024 and December 31, 2023, respectively.

These values are primarily based on quoted market prices for such debt or debt of similar terms and maturities (Level 2) and our credit standing.

5 unchanged sentences

For the Three Months

Ended June 30,

For the Six Months

Ended June 30,

Ended September 30,

For the Nine Months

Ended September 30,

Revenues – related parties:

4 unchanged sentences

The following table summarizes our related party accounts receivable and accounts payable balances at the dates indicated:

September 30,

Accounts receivable - related parties:

7 unchanged sentences

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 June 30, 2024, EPCO and its privately held affiliates (including Dan Duncan LLC and certain Duncan family trusts) beneficially owned the following limited partner interests in us:

At September 30, 2024, EPCO and its privately held affiliates (including Dan Duncan LLC and certain Duncan family trusts) beneficially owned the following limited partner interests in us:

Total Number of Limited Partner Interests Held

3 unchanged sentences

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Of the total number of Partnership common units held by EPCO and its privately held affiliates, 62,976,464 have been pledged as security under the separate credit facilities of EPCO and its privately held affiliates at June 30, 2024.

These credit facilities contain customary and other events of default, including defaults by us and other affiliates of EPCO.

2 unchanged sentences

EPCO and its privately held affiliates use cash on hand and cash distributions they receive from us and other investments to fund their other activities and to meet their respective debt obligations, if any.

During the six months ended June 30, 2024 and 2023, we paid EPCO and its privately held affiliates cash distributions totaling $ 700 million and $ 666 million, respectively.

During the nine months ended September 30, 2024 and 2023, we paid EPCO and its privately held affiliates cash distributions totaling $ 1.1 billion and $ 1.0 billion, respectively.

We have no employees.

3 unchanged sentences

For the Three Months

Ended June 30,

For the Six Months

Ended June 30,

Ended September 30,

For the Nine Months

Ended September 30,

Operating costs and expenses

2 unchanged sentences

We lease office space from privately held affiliates of EPCO at rental rates that approximate market rates.

For each of the three months ended June 30, 2024 and 2023 , we recognized $ 4 million of related party operating lease expense in connection with these office space leases.

For each of the six months ended June 30, 2024 and 2023, we recognized $ 7 million of related party operating lease expense in connection with these office space leases.

For the three months ended September 30, 2024 and 2023 , we recognized $ 7 million and $ 3 million, respectively, of related party operating lease expense in connection with these office space leases.

For the nine months ended September 30, 2024 and 2023, we recognized $ 17 million and $ 10 million, respectively, of related party operating lease expense in connection with these office space leases.

Income taxes are accounted for under the asset-and-liability method.

5 unchanged sentences

Changes in recognition or measurement are reflected in the period in which the change in judgment occurs.

We did not rely on any uncertain tax positions in recording our income tax-related amounts during the three and six months ended June 30, 2024 and 2023 .

We did not rely on any uncertain tax positions in recording our income tax-related amounts during the three and nine months ended September 30, 2024 and 2023 .

Our federal, state and foreign income tax benefit (provision) is summarized below:

For the Three Months

Ended June 30,

For the Six Months

Ended June 30,

Ended September 30,

For the Nine Months

Ended September 30,

Current portion of income tax provision:

8 unchanged sentences

For the Three Months

Ended June 30,

For the Six Months

Ended June 30,

Ended September 30,

For the Nine Months

Ended September 30,

Pre-Tax Net Book Income (“NBI”)

7 unchanged sentences

The following table presents the significant components of deferred tax assets and deferred tax liabilities at the dates indicated:

September 30,

Deferred tax liabilities:

10 unchanged sentences

("OTA"), which we acquired in March 2020.

The loss amount presented as of June 30, 2024 has an indefinite carryover period.

The loss amount presented as of September 30, 2024 has an indefinite carryover period.

All losses are subject to limitations on their utilization.

5 unchanged sentences

We will vigorously defend the Partnership in litigation matters.

There were no accruals for litigation contingencies at June 30, 2024 and December 31, 2023, respectively.

There were no accruals for litigation contingencies at September 30, 2024 and December 31, 2023, respectively.

Contractual Obligations

1 unchanged sentence

We have long-term and short-term payment obligations under debt agreements.

In total, the principal amount of our consolidated debt obligations were $ 30.6 billion and $ 29.0 billion at June 30, 2024 and December 31, 2023, respectively.

In total, the principal amount of our consolidated debt obligations were $ 32.2 billion and $ 29.0 billion at September 30, 2024 and December 31, 2023, respectively.

See Note 7 for additional information regarding our scheduled future maturities of debt principal.

1 unchanged sentence

There has been no significant change in our operating lease obligations since those disclosed in the 2023 Form 10-K.

The following table presents information regarding operating leases where we are the lessee at June 30, 2024:

The following table presents information regarding operating leases where we are the lessee at September 30, 2024:

Asset Category

3 unchanged sentences

Right of use (“ROU”) asset amounts are a component of “ Other assets ” on our Unaudited Condensed Consolidated Balance Sheet.

At June 30, 2024, lease liabilities of $ 95 million and $ 366 million were included within “ Other current liabilities ” and “ Other long-term liabilities ,” respectively.

At September 30, 2024, lease liabilities of $ 95 million and $ 350 million were included within “ Other current liabilities ” and “ Other long-term liabilities ,” respectively.

The discount rate for each category of assets represents the weighted average of either (i) the implicit rate applicable to the underlying leases (where determinable) or (ii) our incremental borrowing rate adjusted for collateralization (if the implicit rate is not determinable).

2 unchanged sentences

For the Three Months

Ended June 30,

For the Six Months

Ended June 30,

Ended September 30,

For the Nine Months

Ended September 30,

Long-term operating leases:

9 unchanged sentences

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Cash paid for operating lease liabilities was $ 27 million and $ 21 million for the three months ended June 30, 2024 and 2023, respectively.

For the six months ended June 30, 2024 and 2023, cash paid for operating lease liabilities was $ 57 million and $ 41 million, respectively.

Operating lease income for the three months ended June 30, 2024 and 2023 was $ 3 million and $ 4 million, respectively.

For the six months ended June 30, 2024 and 2023, operating lease income was $ 7 million and $ 8 million, respectively.

Cash paid for operating lease liabilities was $ 28 million and $ 21 million for the three months ended September 30, 2024 and 2023, respectively.

For the nine months ended September 30, 2024 and 2023, cash paid for operating lease liabilities was $ 78 million and $ 62 million, respectively.

Operating lease income for each of the three months ended September 30, 2024 and 2023 was $ 4 million.

For the nine months ended September 30, 2024 and 2023, operating lease income was $ 11 million and $ 12 million, respectively.

Purchase Obligations

Our consolidated purchase obligations at June 30, 2024 did not differ materially from those reported in our 2023 Form 10-K.

We have contractual future product purchase commitments for natural gas, NGLs, crude oil, petrochemicals and refined products representing enforceable and legally binding agreements as of the reporting date.

Our product purchase commitments decreased from $ 11.9 billion at December 31, 2023 to $ 9.0 billion at September 30, 2024 primarily due to commitments that expired during the year.

Supplemental Cash Flow Information

The following table provides information regarding the net effect of changes in our operating accounts and cash payments for interest and income taxes for the periods indicated:

For the Six Months

Ended June 30,

For the Nine Months

Ended September 30,

Decrease (increase) in:

11 unchanged sentences

Cash payments for interest, net of $ 82 and $ 86 capitalized during the

six months ended June 30, 2024 and 2023 , respectively

nine months ended September 30, 2024 and 2023 , respectively

Cash payments for federal and state income taxes

We incurred liabilities for construction in progress that had not been paid at June 30, 2024 and December 31, 2023 of $ 498 million and $ 400 million, respectively.

We incurred liabilities for construction in progress that had not been paid at September 30, 2024 and December 31, 2023 of $ 491 million and $ 400 million, respectively.

Such amounts are not included under the caption “Capital expenditures” on the Unaudited Condensed Statements of Consolidated Cash Flows.

Subsequent Event

Issuance of $2.5 Billion of Senior Notes in August 2024

Senior Notes JJJ were issued at 99.400 % of their principal amount and have a fixed interest rate of 4.95 % per year.

Senior Notes KKK were issued at 99.663 % of their principal amount and have a fixed interest rate of 5.55 % per year.

The Partnership guaranteed these senior notes through an unconditional guarantee on an unsecured and unsubordinated basis.

Acquisition of Pi ñ on Midstream

In August 2024, we announced that an affiliate of Enterprise entered into a definitive agreement to acquire Piñon Midstream, LLC (“Piñon Midstream”) for $ 950 million in cash consideration.

This transaction, which closed October 28, 2024, was funded using cash on hand.

Piñon Midstream’s assets include approximately 50 miles of natural gas gathering and redelivery pipelines, five 3-stage compressor stations, 270 million cubic feet per day (“MMcf/d”) of hydrogen sulfide and carbon dioxide treating facilities and two high capacity acid gas injection wells.

Due to the recent nature of this transaction, we have not completed the preliminary allocation of the purchase price.

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.

What changed 10-Q

Item 1. Financial Statements