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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Summit Midstream Partners LP | NYSE:SMLP | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
5.86 | 20.81% | 34.02 | 35.89 | 28.25 | 28.25 | 132,591 | 00:53:53 |
Delaware
(State or other jurisdiction of incorporation or organization) |
|
45-5200503
(I.R.S. Employer Identification No.) |
|
|
|
1790 Hughes Landing Blvd, Suite 500
The Woodlands, TX
(Address of principal executive offices)
|
|
77380
(Zip Code)
|
|
|
|
(832) 413-4770
(Registrant’s telephone number, including area code)
|
||
|
||
Not applicable
(Former name or former address, if changed since last report)
|
Large accelerated filer
x
|
|
Accelerated filer
o
|
|
Non-accelerated filer
o
(Do not check if a smaller reporting company)
|
|
Smaller reporting company
o
|
|
Emerging growth company
o
|
|
|
Class
|
|
As of April 30, 2017
|
Common Units
|
|
72,313,098 units
|
General Partner Units
|
|
1,475,778 units
|
|
|
|
Item 1.
|
||
|
||
|
||
|
||
|
||
|
||
Item 2.
|
||
Item 3.
|
||
Item 4.
|
||
|
|
|
Item 1.
|
||
Item 1A.
|
||
Item 6.
|
Exhibits
.
|
2014 SRS
|
the Partnership's automatic shelf registration statement of well-known seasoned issuers initially filed with the SEC in July 2014 and amended in February 2017 which registered an unlimited amount of common units and debt securities
|
2016 Drop Down
|
the Partnership's March 3, 2016 acquisition of substantially all of (i) the issued and outstanding membership interests in Summit Utica, Meadowlark Midstream and Tioga Midstream and (ii) SMP Holdings’ 40% ownership interest in Ohio Gathering from SMP Holdings
|
2016 SRS
|
the Partnership's shelf registration statement declared effective in November 2016 which registered up to $1.5 billion of equity and debt securities in primary offerings and 36,701,230 common units beneficially owned by Summit Investments and affiliates of the Sponsor
|
5.5% Senior Notes
|
Summit Holdings' 5.5% senior unsecured notes due August 2022
|
7.5% Senior Notes
|
Summit Holdings' 7.5% senior unsecured notes redeemed March 2017
|
5.75% Senior Notes
|
Summit Holdings' 5.75% senior unsecured notes due April 2025
|
ABR
|
Alternate Base Rate
|
AMI
|
area of mutual interest; AMIs require that any production from wells drilled by our customers within the AMI be shipped on and/or processed by our gathering systems
|
associated natural gas
|
a form of natural gas which is found with deposits of petroleum, either dissolved in the oil or as a free gas cap above the oil in the reservoir
|
ASU
|
Accounting Standards Update
|
Bbl
|
one barrel; used for crude oil and produced water and equivalent to 42 U.S. gallons
|
Bcf
|
one billion cubic feet
|
Bcfe/d
|
the equivalent of one billion cubic feet per day; generally calculated when liquids are converted into gas; determined using a ratio of six thousand cubic feet of natural gas to one barrel of liquids
|
Bison Midstream
|
Bison Midstream, LLC
|
Board of Directors
|
the board of directors of our General Partner
|
condensate
|
a natural gas liquid with a low vapor pressure, mainly composed of propane, butane, pentane and heavier hydrocarbon fractions
|
conventional resource basin
|
a basin where natural gas or crude oil production is developed from a well drilled into a geologic formation in which the reservoir and fluid characteristics permit the crude oil and natural gas to readily flow to the wellbore; also referred to as a conventional resource play
|
Deferred Purchase Price Obligation
|
the deferred payment liability recognized in connection with the 2016 Drop Down
|
delivery point
|
the point where hydrocarbons or produced water are delivered into a gathering system, processing or fractionation facility or downstream transportation pipeline
|
DFW Midstream
|
DFW Midstream Services LLC
|
DJ Basin
|
Denver-Julesburg Basin
|
dry gas
|
natural gas primarily composed of methane where heavy hydrocarbons and water either do not exist or have been removed through processing or treating
|
end users
|
the ultimate users and consumers of transported energy products
|
Energy Capital Partners
|
Energy Capital Partners II, LLC and its parallel and co-investment funds; also known as the Sponsor
|
Epping
|
Epping Transmission Company, LLC
|
EPU
|
earnings or loss per unit
|
FASB
|
Financial Accounting Standards Board
|
Finance Corp.
|
Summit Midstream Finance Corp.
|
GAAP
|
accounting principles generally accepted in the United States of America
|
General Partner
|
Summit Midstream GP, LLC
|
Grand River
|
Grand River Gathering, LLC
|
IDR
|
incentive distribution rights
|
IPO
|
initial public offering
|
LACT unit
|
lease automatic custody transfer unit; a system for ownership transfer and measurement of hydrocarbons or produced water from the production site to trucks, pipelines or storage tanks
|
LIBOR
|
London Interbank Offered Rate
|
LNG
|
liquefied natural gas; natural gas (predominantly methane with some mixture of ethane) that has been converted to liquid form for ease of storage or transport
|
Mbbl
|
one thousand barrels
|
Mbbl/d
|
one thousand barrels per day
|
Mcf
|
one thousand cubic feet
|
MD&A
|
Management's Discussion and Analysis of Financial Condition and Results of Operations
|
Meadowlark Midstream
|
Meadowlark Midstream Company, LLC
|
MMcf
|
one million cubic feet
|
MMcf/d
|
one million cubic feet per day
|
Mountaineer Midstream
|
Mountaineer Midstream gathering system
|
MQD
|
minimum quarterly distribution
|
MVC
|
minimum volume commitment
|
NGL
|
natural gas liquids; the combination of ethane, propane, normal butane, iso-butane and natural gasolines that when removed from unprocessed natural gas streams become liquid under various levels of higher pressure and lower temperature
|
Niobrara G&P
|
Niobrara Gathering and Processing system
|
OCC
|
Ohio Condensate Company, L.L.C.
|
OGC
|
Ohio Gathering Company, L.L.C.
|
Ohio Gathering
|
Ohio Gathering Company, L.L.C. and Ohio Condensate Company, L.L.C.
|
OpCo
|
Summit Midstream OpCo, LP
|
play
|
a proven geological formation that contains commercial amounts of hydrocarbons
|
Polar and Divide
|
the Polar and Divide system; collectively Polar Midstream and Epping
|
Polar Midstream
|
Polar Midstream, LLC
|
produced water
|
water from underground geologic formations that is a by-product of natural gas and crude oil production
|
receipt point
|
the point where hydrocarbons or produced water are received by or into a gathering system, facility or transportation pipeline; also called a central receipt point
|
Red Rock Gathering
|
Red Rock Gathering Company, LLC
|
Remaining Consideration
|
management's estimate of the consideration to be paid to SMP Holdings in 2020 in connection with the 2016 Drop Down, the present value of which is reflected on our balance sheets as the Deferred Purchase Price Obligation
|
residue gas
|
the natural gas remaining after being processed and/or treated
|
Revolving Credit Facility
|
the Second Amended and Restated Credit Agreement dated as of November 1, 2013
|
SEC
|
Securities and Exchange Commission
|
segment adjusted EBITDA
|
total revenues less total costs and expenses; plus (i) other income excluding interest income, (ii) our proportional adjusted EBITDA for equity method investees, (iii) depreciation and amortization, (iv) adjustments related to MVC shortfall payments, (v) unit-based and noncash compensation, (vi) Deferred Purchase Price Obligation expense, (vii) early extinguishment of debt expense, (viii) impairments and (ix) other noncash expenses or losses, less other noncash income or gains
|
shortfall payment
|
the payment received from a counterparty when its volume throughput does not meet its MVC for the applicable period
|
SMLP
|
Summit Midstream Partners, LP
|
SMLP LTIP
|
SMLP Long-Term Incentive Plan
|
SMP Holdings
|
Summit Midstream Partners Holdings, LLC
|
Sponsor
|
Energy Capital Partners II, LLC and its parallel and co-investment funds; also known as Energy Capital Partners
|
Summit Holdings
|
Summit Midstream Holdings, LLC
|
Summit Investments
|
Summit Midstream Partners, LLC
|
Summit Marketing
|
Summit Midstream Marketing, LLC
|
Summit Utica
|
Summit Midstream Utica, LLC
|
tailgate
|
refers to the point at which processed residue gas and NGLs leave a processing facility for end-use markets
|
Tcfe
|
the equivalent of one trillion cubic feet; generally calculated when liquids are converted into gas; determined using a ratio of six thousand cubic feet of natural gas to one barrel of liquids
|
the Company
|
Summit Midstream Partners, LLC and its subsidiaries
|
the Partnership
|
Summit Midstream Partners, LP and its subsidiaries
|
throughput volume
|
the volume of natural gas, crude oil or produced water transported or passing through a pipeline, plant or other facility during a particular period; also referred to as volume throughput
|
Tioga Midstream
|
Tioga Midstream, LLC
|
unconventional resource basin
|
a basin where natural gas or crude oil production is developed from unconventional sources that require hydraulic fracturing as part of the completion process, for instance, natural gas produced from shale formations and coalbeds; also referred to as an unconventional resource play
|
wellhead
|
the equipment at the surface of a well, used to control the well's pressure; also, the point at which the hydrocarbons and water exit the ground
|
|
March 31,
2017
|
|
December 31,
2016
|
||||
|
(In thousands)
|
||||||
Assets
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
6,285
|
|
|
$
|
7,428
|
|
Accounts receivable
|
53,669
|
|
|
97,364
|
|
||
Other current assets
|
3,240
|
|
|
4,309
|
|
||
Total current assets
|
63,194
|
|
|
109,101
|
|
||
Property, plant and equipment, net
|
1,854,083
|
|
|
1,853,671
|
|
||
Intangible assets, net
|
411,778
|
|
|
421,452
|
|
||
Goodwill
|
16,211
|
|
|
16,211
|
|
||
Investment in equity method investees
|
702,751
|
|
|
707,415
|
|
||
Other noncurrent assets
|
7,056
|
|
|
7,329
|
|
||
Total assets
|
$
|
3,055,073
|
|
|
$
|
3,115,179
|
|
|
|
|
|
||||
Liabilities and Partners' Capital
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Trade accounts payable
|
$
|
17,764
|
|
|
$
|
16,251
|
|
Accrued expenses
|
12,107
|
|
|
11,389
|
|
||
Due to affiliate
|
486
|
|
|
258
|
|
||
Ad valorem taxes payable
|
4,066
|
|
|
10,588
|
|
||
Accrued interest
|
5,703
|
|
|
17,483
|
|
||
Accrued environmental remediation
|
5,883
|
|
|
4,301
|
|
||
Other current liabilities
|
4,818
|
|
|
11,471
|
|
||
Total current liabilities
|
50,827
|
|
|
71,741
|
|
||
Long-term debt
|
1,264,912
|
|
|
1,240,301
|
|
||
Deferred Purchase Price Obligation
|
584,164
|
|
|
563,281
|
|
||
Deferred revenue
|
18,980
|
|
|
57,465
|
|
||
Noncurrent accrued environmental remediation
|
3,263
|
|
|
5,152
|
|
||
Other noncurrent liabilities
|
7,812
|
|
|
7,566
|
|
||
Total liabilities
|
1,929,958
|
|
|
1,945,506
|
|
||
Commitments and contingencies (Note 15)
|
|
|
|
||||
|
|
|
|
||||
Common limited partner capital (72,313 units issued and outstanding at March 31, 2017 and 72,111 units issued and outstanding at December 31, 2016)
|
1,085,255
|
|
|
1,129,132
|
|
||
General partner interests (1,476 units issued and outstanding at March 31, 2017 and 1,471 units issued and outstanding at December 31, 2016)
|
28,511
|
|
|
29,294
|
|
||
Noncontrolling interest
|
11,349
|
|
|
11,247
|
|
||
Total partners' capital
|
1,125,115
|
|
|
1,169,673
|
|
||
Total liabilities and partners' capital
|
$
|
3,055,073
|
|
|
$
|
3,115,179
|
|
|
Three months ended March 31,
|
||||||
|
2017
|
|
2016
|
||||
|
(In thousands, except per-unit amounts)
|
||||||
Revenues:
|
|
|
|
||||
Gathering services and related fees
|
$
|
118,013
|
|
|
$
|
78,100
|
|
Natural gas, NGLs and condensate sales
|
11,120
|
|
|
7,588
|
|
||
Other revenues
|
6,672
|
|
|
4,883
|
|
||
Total revenues
|
135,805
|
|
|
90,571
|
|
||
Costs and expenses:
|
|
|
|
||||
Cost of natural gas and NGLs
|
9,052
|
|
|
6,290
|
|
||
Operation and maintenance
|
23,692
|
|
|
25,842
|
|
||
General and administrative
|
14,132
|
|
|
12,879
|
|
||
Depreciation and amortization
|
28,569
|
|
|
27,728
|
|
||
Transaction costs
|
—
|
|
|
1,174
|
|
||
Loss (gain) on asset sales, net
|
3
|
|
|
(63
|
)
|
||
Long-lived asset impairment
|
284
|
|
|
—
|
|
||
Total costs and expenses
|
75,732
|
|
|
73,850
|
|
||
Other income
|
71
|
|
|
22
|
|
||
Interest expense
|
(16,716
|
)
|
|
(15,882
|
)
|
||
Early extinguishment of debt
|
(22,020
|
)
|
|
—
|
|
||
Deferred Purchase Price Obligation expense
|
(20,883
|
)
|
|
(7,463
|
)
|
||
Income (loss) before income taxes and (loss) income from equity method investees
|
525
|
|
|
(6,602
|
)
|
||
Income tax (expense) benefit
|
(452
|
)
|
|
77
|
|
||
(Loss) income from equity method investees
|
(656
|
)
|
|
2,860
|
|
||
Net loss
|
$
|
(583
|
)
|
|
$
|
(3,665
|
)
|
Less:
|
|
|
|
||||
Net income attributable to Summit Investments
|
—
|
|
|
2,745
|
|
||
Net income attributable to noncontrolling interest
|
102
|
|
|
44
|
|
||
Net loss attributable to SMLP
|
(685
|
)
|
|
(6,454
|
)
|
||
Less net loss and IDRs attributable to General Partner
|
2,092
|
|
|
1,810
|
|
||
Net loss attributable to limited partners
|
$
|
(2,777
|
)
|
|
$
|
(8,264
|
)
|
|
|
|
|
||||
Loss per limited partner unit:
|
|
|
|
||||
Common unit – basic
|
$
|
(0.04
|
)
|
|
$
|
(0.12
|
)
|
Common unit – diluted
|
$
|
(0.04
|
)
|
|
$
|
(0.12
|
)
|
|
|
|
|
||||
Weighted-average limited partner units outstanding:
|
|
|
|
||||
Common units – basic
|
72,149
|
|
|
66,493
|
|
||
Common units – diluted
|
72,149
|
|
|
66,493
|
|
|
Partners' capital
|
|
Noncontrolling interest
|
|
Summit Investments' equity in contributed subsidiaries
|
|
|
||||||||||||||||
|
Limited partners
|
|
General partner
|
|
|
|
|
||||||||||||||||
|
Common
|
|
Subordinated
|
|
|
|
|
Total
|
|||||||||||||||
|
(In thousands)
|
||||||||||||||||||||||
Partners' capital, January 1, 2016
|
$
|
744,977
|
|
|
$
|
213,631
|
|
|
$
|
25,634
|
|
|
$
|
—
|
|
|
$
|
763,057
|
|
|
$
|
1,747,299
|
|
Net (loss) income
|
(9,304
|
)
|
|
1,040
|
|
|
1,810
|
|
|
44
|
|
|
2,745
|
|
|
(3,665
|
)
|
||||||
Distributions to unitholders
|
(24,186
|
)
|
|
(14,034
|
)
|
|
(2,755
|
)
|
|
—
|
|
|
—
|
|
|
(40,975
|
)
|
||||||
Unit-based compensation
|
1,761
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,761
|
|
||||||
Tax withholdings on vested SMLP LTIP awards
|
(786
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(786
|
)
|
||||||
Subordinated units conversion
|
200,637
|
|
|
(200,637
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Purchase of 2016 Drop Down Assets
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(867,427
|
)
|
|
(867,427
|
)
|
||||||
Establishment of noncontrolling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
11,261
|
|
|
(11,261
|
)
|
|
—
|
|
||||||
Distribution of debt related to Carve-Out Financial Statements of Summit Investments
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
342,926
|
|
|
342,926
|
|
||||||
Excess of consideration paid and recognized over acquired carrying value of 2016 Drop Down Assets
|
242,486
|
|
|
—
|
|
|
4,942
|
|
|
—
|
|
|
(247,428
|
)
|
|
—
|
|
||||||
Cash advance from Summit Investments to contributed subsidiaries, net
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
12,214
|
|
|
12,214
|
|
||||||
Expenses paid by Summit Investments on behalf of contributed subsidiaries
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,821
|
|
|
4,821
|
|
||||||
Capitalized interest allocated from Summit Investments to contributed subsidiaries
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
223
|
|
|
223
|
|
||||||
Class B membership interest noncash compensation
|
65
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
130
|
|
|
195
|
|
||||||
Partners' capital, March 31, 2016
|
$
|
1,155,650
|
|
|
$
|
—
|
|
|
$
|
29,631
|
|
|
$
|
11,305
|
|
|
$
|
—
|
|
|
$
|
1,196,586
|
|
|
Partners' capital
|
|
Noncontrolling interest
|
|
|
||||||||||
|
Limited partners
|
|
General partner
|
|
|
|
|||||||||
|
Common
|
|
|
|
Total
|
||||||||||
|
(In thousands)
|
||||||||||||||
Partners' capital, January 1, 2017
|
$
|
1,129,132
|
|
|
$
|
29,294
|
|
|
$
|
11,247
|
|
|
$
|
1,169,673
|
|
Net (loss) income
|
(2,777
|
)
|
|
2,092
|
|
|
102
|
|
|
(583
|
)
|
||||
Distributions to unitholders
|
(41,464
|
)
|
|
(2,988
|
)
|
|
—
|
|
|
(44,452
|
)
|
||||
Unit-based compensation
|
2,048
|
|
|
—
|
|
|
—
|
|
|
2,048
|
|
||||
Tax withholdings on vested SMLP LTIP awards
|
(2,051
|
)
|
|
—
|
|
|
—
|
|
|
(2,051
|
)
|
||||
ATM Program issuances, net of costs
|
367
|
|
|
—
|
|
|
—
|
|
|
367
|
|
||||
Contribution from General Partner
|
—
|
|
|
113
|
|
|
—
|
|
|
113
|
|
||||
Partners' capital, March 31, 2017
|
$
|
1,085,255
|
|
|
$
|
28,511
|
|
|
$
|
11,349
|
|
|
$
|
1,125,115
|
|
|
Three months ended March 31,
|
||||||
|
2017
|
|
2016
|
||||
|
(In thousands)
|
||||||
Cash flows from operating activities:
|
|
|
|
||||
Net loss
|
$
|
(583
|
)
|
|
$
|
(3,665
|
)
|
Adjustments to reconcile net loss to net cash provided by operating activities:
|
|
|
|
||||
Depreciation and amortization
|
28,418
|
|
|
27,865
|
|
||
Amortization of debt issuance costs
|
1,032
|
|
|
905
|
|
||
Deferred Purchase Price Obligation expense
|
20,883
|
|
|
7,463
|
|
||
Unit-based and noncash compensation
|
2,128
|
|
|
1,956
|
|
||
Loss (income) from equity method investees
|
656
|
|
|
(2,860
|
)
|
||
Distributions from equity method investees
|
8,944
|
|
|
11,804
|
|
||
Loss (gain) on asset sales, net
|
3
|
|
|
(63
|
)
|
||
Long-lived asset impairment
|
284
|
|
|
—
|
|
||
Early extinguishment of debt
|
22,020
|
|
|
—
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
||||
Accounts receivable
|
43,695
|
|
|
40,031
|
|
||
Trade accounts payable
|
(4,042
|
)
|
|
(817
|
)
|
||
Accrued expenses
|
718
|
|
|
1,141
|
|
||
Due to affiliate
|
228
|
|
|
(754
|
)
|
||
Deferred revenue
|
(38,485
|
)
|
|
1,473
|
|
||
Ad valorem taxes payable
|
(6,522
|
)
|
|
(5,982
|
)
|
||
Accrued interest
|
(11,780
|
)
|
|
(9,750
|
)
|
||
Accrued environmental remediation, net
|
(307
|
)
|
|
—
|
|
||
Other, net
|
(4,841
|
)
|
|
(1,898
|
)
|
||
Net cash provided by operating activities
|
62,449
|
|
|
66,849
|
|
||
Cash flows from investing activities:
|
|
|
|
||||
Capital expenditures
|
(14,428
|
)
|
|
(61,326
|
)
|
||
Contributions to equity method investees
|
(4,936
|
)
|
|
(15,645
|
)
|
||
Acquisitions of gathering systems from affiliate
|
—
|
|
|
(360,000
|
)
|
||
Other, net
|
(361
|
)
|
|
(377
|
)
|
||
Net cash used in investing activities
|
(19,725
|
)
|
|
(437,348
|
)
|
|
Three months ended March 31,
|
||||||
|
2017
|
|
2016
|
||||
|
(In thousands)
|
||||||
Cash flows from financing activities:
|
|
|
|
||||
Distributions to unitholders
|
(44,452
|
)
|
|
(40,975
|
)
|
||
Borrowings under Revolving Credit Facility
|
72,000
|
|
|
424,300
|
|
||
Repayments under Revolving Credit Facility
|
(245,000
|
)
|
|
(35,300
|
)
|
||
Debt issuance costs
|
(6,825
|
)
|
|
(2,413
|
)
|
||
Payment of redemption and call premiums on senior notes
|
(17,913
|
)
|
|
—
|
|
||
Proceeds from ATM Program issuances, net of costs
|
367
|
|
|
—
|
|
||
Contribution from General Partner
|
113
|
|
|
—
|
|
||
Cash advance from Summit Investments to contributed subsidiaries, net
|
—
|
|
|
12,214
|
|
||
Expenses paid by Summit Investments on behalf of contributed subsidiaries
|
—
|
|
|
4,821
|
|
||
Issuance of senior notes
|
500,000
|
|
|
—
|
|
||
Tender and redemption of senior notes
|
(300,000
|
)
|
|
—
|
|
||
Other, net
|
(2,157
|
)
|
|
(854
|
)
|
||
Net cash (used in) provided by financing activities
|
(43,867
|
)
|
|
361,793
|
|
||
Net change in cash and cash equivalents
|
(1,143
|
)
|
|
(8,706
|
)
|
||
Cash and cash equivalents, beginning of period
|
7,428
|
|
|
21,793
|
|
||
Cash and cash equivalents, end of period
|
$
|
6,285
|
|
|
$
|
13,087
|
|
|
|
|
|
||||
Supplemental cash flow disclosures:
|
|
|
|
||||
Cash interest paid
|
$
|
28,040
|
|
|
$
|
25,164
|
|
Less capitalized interest
|
468
|
|
|
716
|
|
||
Interest paid (net of capitalized interest)
|
$
|
27,572
|
|
|
$
|
24,448
|
|
|
|
|
|
||||
Noncash investing and financing activities:
|
|
|
|
||||
Capital expenditures in trade accounts payable (period-end accruals)
|
$
|
13,977
|
|
|
$
|
13,769
|
|
Issuance of Deferred Purchase Price Obligation to affiliate to partially fund the 2016 Drop Down
|
—
|
|
|
507,427
|
|
||
Excess of acquired carrying value over consideration paid and recognized for 2016 Drop Down Assets
|
—
|
|
|
247,428
|
|
||
Distribution of debt related to Carve-Out Financial Statements of Summit Investments
|
—
|
|
|
342,926
|
|
||
Capitalized interest allocated to contributed subsidiaries from Summit Investments
|
—
|
|
|
223
|
|
•
|
Ohio Gathering, a natural gas gathering system and a condensate stabilization facility operating in the Appalachian Basin, which includes the Utica and Point Pleasant shale formations in southeastern Ohio;
|
•
|
Summit Utica, a natural gas gathering system operating in the Appalachian Basin, which includes the Utica and Point Pleasant shale formations in southeastern Ohio;
|
•
|
Bison Midstream, an associated natural gas gathering system operating in the Williston Basin, which includes the Bakken and Three Forks shale formations in northwestern North Dakota;
|
•
|
Polar and Divide, crude oil and produced water gathering systems and transmission pipelines located in the Williston Basin, which includes the Bakken and Three Forks shale formations in northwestern North Dakota;
|
•
|
Tioga Midstream, crude oil, produced water and associated natural gas gathering systems, operating in the Williston Basin, which includes the Bakken and Three Forks shale formations in northwestern North Dakota;
|
•
|
Grand River, a natural gas gathering and processing system located in the Piceance Basin, which includes the Mesaverde formation and the Mancos and Niobrara shale formations in western Colorado and eastern Utah;
|
•
|
Niobrara G&P, an associated natural gas gathering and processing system operating in the DJ Basin, which includes the Niobrara and Codell shale formations in northeastern Colorado;
|
•
|
DFW Midstream, a natural gas gathering system operating in the Fort Worth Basin, which includes the Barnett Shale formation in north-central Texas; and
|
•
|
Mountaineer Midstream, a natural gas gathering system operating in the Appalachian Basin, which includes the Marcellus Shale formation in northern West Virginia.
|
•
|
ASU No. 2016-09 Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting ("ASU 2016-09"). ASU 2016-09 simplifies several aspects for share-based payment award transactions, including income tax consequences, the liability or equity classification of awards and classification on the statements of cash flows. ASU 2016-09 is effective for public companies for fiscal years beginning after December 15, 2016. It does not specify a single transition approach, rather it specifies retrospective, modified retrospective and/or prospective transition approaches based on the aspect being applied. We adopted the provisions of ASU 2016-09 effective January 1, 2017. The adoption of this standard had no impact on our consolidated financial statements.
|
•
|
ASU No. 2014-09 Revenue from Contracts with Customers (Topic 606) ("ASU 2014-09"). Under ASU 2014-09, revenue will be recognized under a five-step model: (i) identify the contract with the customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to performance obligations; and (v) recognize revenue when (or as) the performance obligation is satisfied. ASU 2014-09 is effective for fiscal years and interim periods within those years, beginning after December 15, 2017 and allows for early adoption. We expect to adopt the provisions of ASU 2014-09 effective January 1, 2018 using the modified retrospective method.
|
•
|
ASU No. 2016-02 Leases (Topic 842) ("ASU 2016-02"). ASU 2016-02 requires that lessees recognize all leases on the balance sheet, with the exception of short-term leases. A lease liability will be recorded for the obligation of a lessee to make lease payments arising from a lease. A right-of-use asset will be recorded which represents the lessee’s right to use, or to control the use of, a specified asset for a lease term. We are currently evaluating the impact of this guidance on lessor accounting but have made no determinations at this time. ASU 2016-02 is effective for public companies for fiscal years beginning after December 15, 2018, and requires the modified retrospective approach for transition. We are currently evaluating the provisions of ASU 2016-02 to determine its impact on our financial statements and related disclosures and expect to adopt its provisions effective January 1, 2019.
|
•
|
ASU No. 2016-08 Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net) ("ASU 2016-08"). ASU 2016-08 does not change the core principle of Topic 606, rather it clarifies the implementation guidance on principal versus agent considerations. We expect to adopt the provisions of ASU 2016-08 effective January 1, 2018. Our position regarding the impact of and transition method for this update is the same as for ASU 2014-09.
|
•
|
ASU No. 2016-10 Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing ("ASU 2016-10"). ASU 2016-10 clarifies the following two aspects of Topic 606 (i) identifying performance obligations and (ii) the licensing implementation guidance, while retaining the related principles for those areas. We expect to adopt the provisions of ASU 2016-10 effective January 1, 2018. Our position regarding the impact of and transition method for this update is the same as for ASU 2014-09.
|
•
|
ASU No. 2016-12 Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients ("ASU 2016-12"). ASU 2016-12 does not change the core principle of the guidance in Topic 606. Rather, the amendments therein affect only the narrow aspects of Topic 606 including assessing the collectability criterion and issues related to contract modification at transition and completed contracts at transition. We expect to adopt the provisions of ASU 2016-12 effective January 1, 2018. Our position regarding the impact of and transition method for this update is the same as for ASU 2014-09.
|
•
|
the Utica Shale, which includes our ownership interest in Ohio Gathering and is served by Summit Utica;
|
•
|
the Williston Basin, which is served by Bison Midstream, Polar and Divide and Tioga Midstream;
|
•
|
the Piceance/DJ Basins, which is served by Grand River and Niobrara G&P;
|
•
|
the Barnett Shale, which is served by DFW Midstream; and
|
•
|
the Marcellus Shale, which is served by Mountaineer Midstream.
|
|
March 31,
2017
|
|
December 31,
2016
|
||||
|
(In thousands)
|
||||||
Assets:
|
|
|
|
||||
Utica Shale (1)
|
$
|
913,691
|
|
|
$
|
906,807
|
|
Williston Basin
|
701,453
|
|
|
724,084
|
|
||
Piceance/DJ Basins
|
805,775
|
|
|
843,440
|
|
||
Barnett Shale
|
396,516
|
|
|
404,314
|
|
||
Marcellus Shale
|
222,871
|
|
|
224,709
|
|
||
Total reportable segment assets
|
3,040,306
|
|
|
3,103,354
|
|
||
Corporate and other
|
15,146
|
|
|
12,294
|
|
||
Eliminations
|
(379
|
)
|
|
(469
|
)
|
||
Total assets
|
$
|
3,055,073
|
|
|
$
|
3,115,179
|
|
|
Three months ended March 31,
|
||||||
|
2017
|
|
2016
|
||||
|
(In thousands)
|
||||||
Revenues:
|
|
|
|
||||
Utica Shale (1)
|
$
|
8,796
|
|
|
$
|
4,283
|
|
Williston Basin
|
66,885
|
|
|
30,008
|
|
||
Piceance/DJ Basins
|
34,808
|
|
|
28,993
|
|
||
Barnett Shale
|
17,742
|
|
|
20,402
|
|
||
Marcellus Shale
|
6,904
|
|
|
6,885
|
|
||
Total reportable segments revenue
|
135,135
|
|
|
90,571
|
|
||
Corporate and other
|
1,786
|
|
|
—
|
|
||
Eliminations
|
(1,116
|
)
|
|
—
|
|
||
Total revenues
|
$
|
135,805
|
|
|
$
|
90,571
|
|
|
Three months ended March 31,
|
|||
|
2017
|
|
2016
|
|
Percentage of total revenues (1):
|
|
|
|
|
Counterparty A - Williston Basin
|
32
|
%
|
|
*
|
|
Three months ended March 31,
|
||||||
|
2017
|
|
2016
|
||||
|
(In thousands)
|
||||||
Depreciation and amortization:
|
|
|
|
||||
Utica Shale (1)
|
$
|
1,647
|
|
|
$
|
844
|
|
Williston Basin
|
8,381
|
|
|
8,357
|
|
||
Piceance/DJ Basins
|
12,211
|
|
|
12,273
|
|
||
Barnett Shale (2)
|
3,762
|
|
|
4,056
|
|
||
Marcellus Shale
|
2,263
|
|
|
2,219
|
|
||
Total reportable segment depreciation and amortization
|
28,264
|
|
|
27,749
|
|
||
Corporate and other
|
154
|
|
|
116
|
|
||
Total depreciation and amortization
|
$
|
28,418
|
|
|
$
|
27,865
|
|
|
Three months ended March 31,
|
||||||
|
2017
|
|
2016
|
||||
|
(In thousands)
|
||||||
Cash paid for capital expenditures:
|
|
|
|
||||
Utica Shale (1)
|
$
|
7,862
|
|
|
$
|
34,988
|
|
Williston Basin
|
429
|
|
|
18,034
|
|
||
Piceance/DJ Basins
|
5,864
|
|
|
5,824
|
|
||
Barnett Shale
|
(995
|
)
|
|
563
|
|
||
Marcellus Shale
|
265
|
|
|
1,738
|
|
||
Total reportable segment capital expenditures
|
13,425
|
|
|
61,147
|
|
||
Corporate and other
|
1,003
|
|
|
179
|
|
||
Total cash paid for capital expenditures
|
$
|
14,428
|
|
|
$
|
61,326
|
|
|
Three months ended March 31,
|
||||||
|
2017
|
|
2016
|
||||
|
(In thousands)
|
||||||
Reportable segment adjusted EBITDA:
|
|
|
|
||||
Utica Shale (1)
|
$
|
16,985
|
|
|
$
|
15,577
|
|
Williston Basin
|
17,809
|
|
|
19,719
|
|
||
Piceance/DJ Basins
|
28,974
|
|
|
24,817
|
|
||
Barnett Shale
|
12,088
|
|
|
14,077
|
|
||
Marcellus Shale
|
5,647
|
|
|
4,600
|
|
||
Total of reportable segments’ measures of profit or loss
|
$
|
81,503
|
|
|
$
|
78,790
|
|
|
Three months ended March 31,
|
||||||
|
2017
|
|
2016
|
||||
|
(In thousands)
|
||||||
Reconciliation of income or loss before income taxes and income or loss from equity method investees to total of reportable segments' measures of profit or loss:
|
|
|
|
||||
Income (loss) before income taxes and (loss) income from equity method investees
|
$
|
525
|
|
|
$
|
(6,602
|
)
|
Add:
|
|
|
|
||||
Corporate and other
|
10,093
|
|
|
8,781
|
|
||
Interest expense
|
16,716
|
|
|
15,882
|
|
||
Early extinguishment of debt
|
22,020
|
|
|
—
|
|
||
Deferred Purchase Price Obligation expense
|
20,883
|
|
|
7,463
|
|
||
Depreciation and amortization
|
28,418
|
|
|
27,865
|
|
||
Proportional adjusted EBITDA for equity method investees
|
9,073
|
|
|
12,388
|
|
||
Adjustments related to MVC shortfall payments
|
(28,640
|
)
|
|
11,142
|
|
||
Unit-based and noncash compensation
|
2,128
|
|
|
1,956
|
|
||
Loss (gain) on asset sales, net
|
3
|
|
|
(63
|
)
|
||
Long-lived asset impairment
|
284
|
|
|
—
|
|
||
Less:
|
|
|
|
||||
Interest income
|
—
|
|
|
22
|
|
||
Total of reportable segments' measures of profit or loss
|
$
|
81,503
|
|
|
$
|
78,790
|
|
|
Three months ended March 31, 2017
|
||||||||||||||
|
Williston Basin
|
|
Piceance/DJ
Basins
|
|
Barnett
Shale
|
|
Total
|
||||||||
|
|
|
|
|
|
|
|
||||||||
|
(In thousands)
|
||||||||||||||
Adjustments related to MVC shortfall payments:
|
|
|
|
|
|
|
|
||||||||
Net change in deferred revenue for MVC shortfall payments
|
$
|
(37,693
|
)
|
|
$
|
(792
|
)
|
|
$
|
—
|
|
|
$
|
(38,485
|
)
|
Expected MVC shortfall payments
|
1,982
|
|
|
6,545
|
|
|
1,318
|
|
|
9,845
|
|
||||
Total adjustments related to MVC shortfall payments
|
$
|
(35,711
|
)
|
|
$
|
5,753
|
|
|
$
|
1,318
|
|
|
$
|
(28,640
|
)
|
|
Three months ended March 31, 2016
|
||||||||||||||
|
Williston Basin
|
|
Piceance/DJ
Basins
|
|
Barnett
Shale
|
|
Total
|
||||||||
|
|
|
|
|
|
|
|
||||||||
|
(In thousands)
|
||||||||||||||
Adjustments related to MVC shortfall payments:
|
|
|
|
|
|
|
|
||||||||
Net change in deferred revenue for MVC shortfall payments
|
$
|
235
|
|
|
$
|
1,238
|
|
|
$
|
—
|
|
|
$
|
1,473
|
|
Expected MVC shortfall payments
|
3,301
|
|
|
6,279
|
|
|
89
|
|
|
9,669
|
|
||||
Total adjustments related to MVC shortfall payments
|
$
|
3,536
|
|
|
$
|
7,517
|
|
|
$
|
89
|
|
|
$
|
11,142
|
|
|
March 31,
2017
|
|
December 31,
2016
|
||||
|
(In thousands)
|
||||||
Gathering and processing systems and related equipment
|
$
|
2,040,517
|
|
|
$
|
2,026,363
|
|
Construction in progress
|
44,464
|
|
|
39,954
|
|
||
Land and line fill
|
11,442
|
|
|
11,442
|
|
||
Other
|
35,439
|
|
|
35,227
|
|
||
Total
|
2,131,862
|
|
|
2,112,986
|
|
||
Less accumulated depreciation
|
277,779
|
|
|
259,315
|
|
||
Property, plant and equipment, net
|
$
|
1,854,083
|
|
|
$
|
1,853,671
|
|
|
Three months ended March 31,
|
||||||
|
2017
|
|
2016
|
||||
|
(In thousands)
|
||||||
Depreciation expense
|
$
|
18,491
|
|
|
$
|
17,370
|
|
Capitalized interest
|
468
|
|
|
716
|
|
|
March 31, 2017
|
||||||||||||
|
Useful lives
(In years)
|
|
Gross carrying amount
|
|
Accumulated amortization
|
|
Net
|
||||||
|
|
|
(Dollars in thousands)
|
||||||||||
Favorable gas gathering contracts
|
18.7
|
|
$
|
24,195
|
|
|
$
|
(11,184
|
)
|
|
$
|
13,011
|
|
Contract intangibles
|
12.5
|
|
426,464
|
|
|
(155,019
|
)
|
|
271,445
|
|
|||
Rights-of-way
|
26.1
|
|
153,808
|
|
|
(26,486
|
)
|
|
127,322
|
|
|||
Total intangible assets
|
|
|
$
|
604,467
|
|
|
$
|
(192,689
|
)
|
|
$
|
411,778
|
|
|
|
|
|
|
|
|
|
||||||
Unfavorable gas gathering contract
|
10.0
|
|
$
|
10,962
|
|
|
$
|
(7,456
|
)
|
|
$
|
3,506
|
|
|
December 31, 2016
|
||||||||||||
|
Useful lives
(In years)
|
|
Gross carrying amount
|
|
Accumulated amortization
|
|
Net
|
||||||
|
|
|
(Dollars in thousands)
|
||||||||||
Favorable gas gathering contracts
|
18.7
|
|
$
|
24,195
|
|
|
$
|
(10,795
|
)
|
|
$
|
13,400
|
|
Contract intangibles
|
12.5
|
|
426,464
|
|
|
(146,468
|
)
|
|
279,996
|
|
|||
Rights-of-way
|
26.1
|
|
153,015
|
|
|
(24,959
|
)
|
|
128,056
|
|
|||
Total intangible assets
|
|
|
$
|
603,674
|
|
|
$
|
(182,222
|
)
|
|
$
|
421,452
|
|
|
|
|
|
|
|
|
|
||||||
Unfavorable gas gathering contract
|
10.0
|
|
$
|
10,962
|
|
|
$
|
(6,916
|
)
|
|
$
|
4,046
|
|
|
Three months ended March 31,
|
||||||
|
2017
|
|
2016
|
||||
|
(In thousands)
|
||||||
Amortization expense – favorable gas gathering contracts
|
$
|
(389
|
)
|
|
$
|
(338
|
)
|
Amortization expense – unfavorable gas gathering contract
|
540
|
|
|
201
|
|
|
Three months ended March 31,
|
||||||
|
2017
|
|
2016
|
||||
|
(In thousands)
|
||||||
Amortization expense – contract intangibles
|
$
|
8,551
|
|
|
$
|
8,854
|
|
Amortization expense – rights-of-way
|
1,527
|
|
|
1,503
|
|
|
Intangible assets
|
|
Unfavorable gas gathering contract
|
||||
|
(In thousands)
|
||||||
2017
|
$
|
31,531
|
|
|
$
|
1,618
|
|
2018
|
41,349
|
|
|
1,888
|
|
||
2019
|
41,180
|
|
|
—
|
|
||
2020
|
43,429
|
|
|
—
|
|
||
2021
|
41,655
|
|
|
—
|
|
Investment in equity method investees, March 31, 2017
|
$
|
702,751
|
|
March cash distribution
|
2,884
|
|
|
Basis difference
|
(140,198
|
)
|
|
Investment in equity method investees, net of basis difference, February 28, 2017
|
$
|
565,437
|
|
|
Three months ended
February 28, 2017
|
|
Three months ended
February 29, 2016
|
||||||||||||
|
OGC
|
|
OCC
|
|
OGC
|
|
OCC
|
||||||||
|
(In thousands)
|
||||||||||||||
Total revenues
|
$
|
37,075
|
|
|
$
|
2,053
|
|
|
$
|
37,799
|
|
|
$
|
5,198
|
|
Total operating expenses
|
27,105
|
|
|
2,473
|
|
|
22,533
|
|
|
4,559
|
|
||||
Net income (loss)
|
7,973
|
|
|
(1,215
|
)
|
|
15,269
|
|
|
456
|
|
|
Williston Basin
|
|
Piceance/DJ
Basins
|
|
Total
current
|
||||||
|
(In thousands)
|
||||||||||
Current deferred revenue, January 1, 2017
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Additions
|
—
|
|
|
3,574
|
|
|
3,574
|
|
|||
Less revenue recognized
|
—
|
|
|
3,574
|
|
|
3,574
|
|
|||
Current deferred revenue, March 31, 2017
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Williston Basin
|
|
Piceance/DJ
Basins
|
|
Total noncurrent
|
||||||
|
(In thousands)
|
||||||||||
Noncurrent deferred revenue, January 1, 2017
|
$
|
37,693
|
|
|
$
|
19,772
|
|
|
$
|
57,465
|
|
Additions
|
—
|
|
|
—
|
|
|
—
|
|
|||
Less revenue recognized
|
37,693
|
|
|
792
|
|
|
38,485
|
|
|||
Noncurrent deferred revenue, March 31, 2017
|
$
|
—
|
|
|
$
|
18,980
|
|
|
$
|
18,980
|
|
|
March 31,
2017
|
|
December 31,
2016
|
||||
|
(In thousands)
|
||||||
Summit Holdings variable rate senior secured Revolving Credit Facility (3.49% at March 31, 2017 and 3.27% at December 31, 2016) due November 2018
|
$
|
475,000
|
|
|
$
|
648,000
|
|
Summit Holdings 5.5% senior unsecured notes due August 2022
|
300,000
|
|
|
300,000
|
|
||
Less unamortized debt issuance costs (1)
|
(3,359
|
)
|
|
(3,516
|
)
|
||
Summit Holdings 5.75% senior unsecured notes due April 2025
|
500,000
|
|
|
—
|
|
||
Less unamortized debt issuance costs (1)
|
(6,729
|
)
|
|
—
|
|
||
Summit Holdings 7.5% senior unsecured notes redeemed March 2017 (2)
|
—
|
|
|
300,000
|
|
||
Less unamortized debt issuance costs (1) (2)
|
—
|
|
|
(4,183
|
)
|
||
Total long-term debt
|
$
|
1,264,912
|
|
|
$
|
1,240,301
|
|
Level 3 liability, January 1, 2017
|
$
|
563,281
|
|
Change in fair value
|
20,883
|
|
|
Level 3 liability, March 31, 2017
|
$
|
584,164
|
|
|
March 31, 2017
|
|
December 31, 2016
|
||||||||||||
|
Carrying
value
|
|
Estimated
fair value
(Level 2)
|
|
Carrying
value
|
|
Estimated
fair value
(Level 2)
|
||||||||
|
(In thousands)
|
||||||||||||||
Summit Holdings Revolving Credit Facility
|
$
|
475,000
|
|
|
$
|
475,000
|
|
|
$
|
648,000
|
|
|
$
|
648,000
|
|
Summit Holdings 5.5% Senior Notes ($300.0 million principal)
|
296,641
|
|
|
300,500
|
|
|
296,484
|
|
|
294,500
|
|
||||
Summit Holdings 5.75% Senior Notes ($500.0 million principal)
|
493,271
|
|
|
497,500
|
|
|
—
|
|
|
—
|
|
||||
Summit Holdings 7.5% Senior Notes ($300.0 million principal) (1)
|
—
|
|
|
—
|
|
|
295,817
|
|
|
316,000
|
|
|
Common
|
|
General Partner
|
|
Total
|
|||
Units, January 1, 2017
|
72,111,121
|
|
|
1,471,187
|
|
|
73,582,308
|
|
Net units issued under SMLP LTIP
|
184,277
|
|
|
—
|
|
|
184,277
|
|
Units issued under ATM Program
|
17,700
|
|
|
—
|
|
|
17,700
|
|
General Partner 2% capital contribution
|
—
|
|
|
4,591
|
|
|
4,591
|
|
Units, March 31, 2017
|
72,313,098
|
|
|
1,475,778
|
|
|
73,788,876
|
|
|
Three months ended March 31,
|
||||||
|
2017
|
|
2016
|
||||
Per-unit distributions to unitholders
|
$
|
0.575
|
|
|
$
|
0.575
|
|
|
Three months ended March 31,
|
||||||
|
2017
|
|
2016
|
||||
|
(In thousands)
|
||||||
IDR payments
|
$
|
2,100
|
|
|
$
|
1,935
|
|
|
Three months ended March 31,
|
||||||
|
2017
|
|
2016
|
||||
|
(In thousands, except per-unit amounts)
|
||||||
Numerator for basic and diluted EPU:
|
|
|
|
||||
Net loss attributable to common units
|
$
|
(2,777
|
)
|
|
$
|
(8,264
|
)
|
|
|
|
|
||||
Denominator for basic and diluted EPU:
|
|
|
|
||||
Weighted-average common units outstanding – basic
|
72,149
|
|
|
66,493
|
|
||
Effect of nonvested phantom units
|
—
|
|
|
—
|
|
||
Weighted-average common units outstanding – diluted
|
72,149
|
|
|
66,493
|
|
||
|
|
|
|
||||
Loss per limited partner unit:
|
|
|
|
||||
Common unit – basic
|
$
|
(0.04
|
)
|
|
$
|
(0.12
|
)
|
Common unit – diluted
|
$
|
(0.04
|
)
|
|
$
|
(0.12
|
)
|
|
|
|
|
||||
Nonvested anti-dilutive phantom units excluded from the calculation of diluted EPU
|
167
|
|
|
497
|
|
•
|
In March 2017, we granted
366,181
phantom units and associated distribution equivalent rights ("DERs") to employees in connection with our annual incentive compensation award cycle. These awards had a grant date fair value of
$22.50
and vest ratably over a
three
-year period.
|
•
|
Also in March 2017,
184,277
phantom units vested.
|
•
|
As of
March 31, 2017
, approximately
3.6 million
common units remained available for future issuance under the SMLP LTIP.
|
|
Three months ended March 31,
|
||||||
|
2017
|
|
2016
|
||||
|
(In thousands)
|
||||||
Operation and maintenance expense
|
$
|
6,881
|
|
|
$
|
6,749
|
|
General and administrative expense
|
8,295
|
|
|
7,778
|
|
•
|
certain support expenses and capital expenditures on behalf of the contributed subsidiaries. These transactions were settled periodically through membership interests prior to the respective drop down;
|
•
|
interest expense that was related to capital projects for the contributed subsidiaries. As such, the associated interest expense was allocated to the respective contributed subsidiary's capital projects as a noncash contribution and capitalized into the basis of the asset; and
|
•
|
noncash compensation expense for the SMP net profits interests, which were accounted for as compensatory awards. As such, the annual expense associated with the SMP net profits was allocated to the respective contributed subsidiary and is reflected in general and administrative expenses in the statements of operations.
|
|
Three months ended March 31,
|
||||||
|
2017
|
|
2016
|
||||
|
(In thousands)
|
||||||
Rent expense
|
$
|
688
|
|
|
$
|
616
|
|
|
Total
|
||
|
(In thousands)
|
||
Accrued environmental remediation, January 1, 2017
|
$
|
9,453
|
|
Payments made
|
(307
|
)
|
|
Accrued environmental remediation, March 31, 2017
|
$
|
9,146
|
|
•
|
six-and-one-half (
6.5
) multiplied by the average Business Adjusted EBITDA, as defined below and in the Contribution Agreement, of the 2016 Drop Down Assets for 2018 and 2019, less the G&A Adjuster, as defined in the Contribution Agreement;
|
•
|
less the Initial Payment;
|
•
|
less all capital expenditures incurred for the 2016 Drop Down Assets between the March 3, 2016 and December 31, 2019;
|
•
|
plus all Business Adjusted EBITDA from the 2016 Drop Down Assets between March 3, 2016 and December 31, 2019, less the Cumulative G&A Adjuster, as defined in the Contribution Agreement.
|
•
|
plus interest expense, income tax expense and depreciation and amortization of the 2016 Drop Down Assets for such period;
|
•
|
plus any adjustments related to MVC shortfall payments, impairments and other noncash expenses or losses with respect to the 2016 Drop Down Assets for such period;
|
•
|
plus any Special Liability Expenses, as defined below and in the Contribution Agreement, for such period;
|
•
|
less interest income and income tax benefit of the 2016 Drop Down Assets for such period;
|
•
|
less adjustments related to any other noncash income or gains with respect to the 2016 Drop Down Assets for such period.
|
|
Three months ended
March 31, 2016
|
||
|
(In thousands)
|
||
SMLP revenues
|
$
|
81,704
|
|
2016 Drop Down Assets revenues (1)
|
8,867
|
|
|
Combined revenues
|
$
|
90,571
|
|
|
|
||
SMLP net loss
|
$
|
(6,410
|
)
|
2016 Drop Down Assets net income (1)
|
2,745
|
|
|
Combined net loss
|
$
|
(3,665
|
)
|
•
|
each of SMLP and the Co-Issuers account for their subsidiary investments, if any, under the equity method of accounting and
|
•
|
the balances and results of operations associated with the assets, liabilities and expenses that were carved out of Summit Investments and allocated to SMLP in connection with the 2016 Drop Down have been attributed to SMLP during the common control period.
|
|
March 31, 2017
|
||||||||||||||||||||||
|
SMLP
|
|
Co-Issuers
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Consolidating adjustments
|
|
Total
|
||||||||||||
|
(In thousands)
|
||||||||||||||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cash and cash equivalents
|
$
|
3,180
|
|
|
$
|
5
|
|
|
$
|
2,725
|
|
|
$
|
375
|
|
|
$
|
—
|
|
|
$
|
6,285
|
|
Accounts receivable
|
22
|
|
|
—
|
|
|
42,349
|
|
|
11,298
|
|
|
—
|
|
|
53,669
|
|
||||||
Other current assets
|
1,277
|
|
|
—
|
|
|
1,665
|
|
|
298
|
|
|
—
|
|
|
3,240
|
|
||||||
Due from affiliate
|
10,712
|
|
|
12,745
|
|
|
442,967
|
|
|
—
|
|
|
(466,424
|
)
|
|
—
|
|
||||||
Total current assets
|
15,191
|
|
|
12,750
|
|
|
489,706
|
|
|
11,971
|
|
|
(466,424
|
)
|
|
63,194
|
|
||||||
Property, plant and equipment, net
|
3,115
|
|
|
—
|
|
|
1,433,385
|
|
|
417,583
|
|
|
—
|
|
|
1,854,083
|
|
||||||
Intangible assets, net
|
—
|
|
|
—
|
|
|
386,802
|
|
|
24,976
|
|
|
—
|
|
|
411,778
|
|
||||||
Goodwill
|
—
|
|
|
—
|
|
|
16,211
|
|
|
—
|
|
|
—
|
|
|
16,211
|
|
||||||
Investment in equity method investees
|
—
|
|
|
—
|
|
|
—
|
|
|
702,751
|
|
|
—
|
|
|
702,751
|
|
||||||
Other noncurrent assets
|
2,403
|
|
|
4,496
|
|
|
157
|
|
|
—
|
|
|
—
|
|
|
7,056
|
|
||||||
Investment in subsidiaries
|
2,153,590
|
|
|
3,406,959
|
|
|
—
|
|
|
—
|
|
|
(5,560,549
|
)
|
|
—
|
|
||||||
Total assets
|
$
|
2,174,299
|
|
|
$
|
3,424,205
|
|
|
$
|
2,326,261
|
|
|
$
|
1,157,281
|
|
|
$
|
(6,026,973
|
)
|
|
$
|
3,055,073
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Liabilities and Partners' Capital
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Trade accounts payable
|
$
|
863
|
|
|
$
|
—
|
|
|
$
|
9,502
|
|
|
$
|
7,399
|
|
|
$
|
—
|
|
|
$
|
17,764
|
|
Accrued expenses
|
1,946
|
|
|
—
|
|
|
7,229
|
|
|
2,932
|
|
|
—
|
|
|
12,107
|
|
||||||
Due to affiliate
|
456,198
|
|
|
—
|
|
|
—
|
|
|
10,712
|
|
|
(466,424
|
)
|
|
486
|
|
||||||
Ad valorem taxes payable
|
—
|
|
|
—
|
|
|
3,862
|
|
|
204
|
|
|
—
|
|
|
4,066
|
|
||||||
Accrued interest
|
—
|
|
|
5,703
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,703
|
|
||||||
Accrued environmental remediation
|
—
|
|
|
—
|
|
|
—
|
|
|
5,883
|
|
|
—
|
|
|
5,883
|
|
||||||
Other current liabilities
|
2,240
|
|
|
—
|
|
|
2,239
|
|
|
339
|
|
|
—
|
|
|
4,818
|
|
||||||
Total current liabilities
|
461,247
|
|
|
5,703
|
|
|
22,832
|
|
|
27,469
|
|
|
(466,424
|
)
|
|
50,827
|
|
||||||
Long-term debt
|
—
|
|
|
1,264,912
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,264,912
|
|
||||||
Deferred Purchase Price Obligation
|
584,164
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
584,164
|
|
||||||
Deferred revenue
|
—
|
|
|
—
|
|
|
18,980
|
|
|
—
|
|
|
—
|
|
|
18,980
|
|
||||||
Noncurrent accrued environmental remediation
|
—
|
|
|
—
|
|
|
—
|
|
|
3,263
|
|
|
—
|
|
|
3,263
|
|
||||||
Other noncurrent liabilities
|
3,773
|
|
|
—
|
|
|
3,948
|
|
|
91
|
|
|
|
|
7,812
|
|
|||||||
Total liabilities
|
1,049,184
|
|
|
1,270,615
|
|
|
45,760
|
|
|
30,823
|
|
|
(466,424
|
)
|
|
1,929,958
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Total partners' capital
|
1,125,115
|
|
|
2,153,590
|
|
|
2,280,501
|
|
|
1,126,458
|
|
|
(5,560,549
|
)
|
|
1,125,115
|
|
||||||
Total liabilities and partners' capital
|
$
|
2,174,299
|
|
|
$
|
3,424,205
|
|
|
$
|
2,326,261
|
|
|
$
|
1,157,281
|
|
|
$
|
(6,026,973
|
)
|
|
$
|
3,055,073
|
|
|
December 31, 2016
|
||||||||||||||||||||||
|
SMLP
|
|
Co-Issuers
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Consolidating adjustments
|
|
Total
|
||||||||||||
|
(In thousands)
|
||||||||||||||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cash and cash equivalents
|
$
|
698
|
|
|
$
|
51
|
|
|
$
|
5,647
|
|
|
$
|
1,032
|
|
|
$
|
—
|
|
|
$
|
7,428
|
|
Accounts receivable
|
53
|
|
|
—
|
|
|
89,584
|
|
|
7,727
|
|
|
—
|
|
|
97,364
|
|
||||||
Other current assets
|
1,526
|
|
|
—
|
|
|
2,328
|
|
|
455
|
|
|
—
|
|
|
4,309
|
|
||||||
Due from affiliate
|
14,896
|
|
|
38,013
|
|
|
369,995
|
|
|
—
|
|
|
(422,904
|
)
|
|
—
|
|
||||||
Total current assets
|
17,173
|
|
|
38,064
|
|
|
467,554
|
|
|
9,214
|
|
|
(422,904
|
)
|
|
109,101
|
|
||||||
Property, plant and equipment, net
|
2,266
|
|
|
—
|
|
|
1,440,180
|
|
|
411,225
|
|
|
—
|
|
|
1,853,671
|
|
||||||
Intangible assets, net
|
—
|
|
|
—
|
|
|
396,930
|
|
|
24,522
|
|
|
—
|
|
|
421,452
|
|
||||||
Goodwill
|
—
|
|
|
—
|
|
|
16,211
|
|
|
—
|
|
|
—
|
|
|
16,211
|
|
||||||
Investment in equity method investees
|
—
|
|
|
—
|
|
|
—
|
|
|
707,415
|
|
|
—
|
|
|
707,415
|
|
||||||
Other noncurrent assets
|
1,993
|
|
|
5,198
|
|
|
138
|
|
|
—
|
|
|
—
|
|
|
7,329
|
|
||||||
Investment in subsidiaries
|
2,132,757
|
|
|
3,347,393
|
|
|
—
|
|
|
—
|
|
|
(5,480,150
|
)
|
|
—
|
|
||||||
Total assets
|
$
|
2,154,189
|
|
|
$
|
3,390,655
|
|
|
$
|
2,321,013
|
|
|
$
|
1,152,376
|
|
|
$
|
(5,903,054
|
)
|
|
$
|
3,115,179
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Liabilities and Partners' Capital
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Trade accounts payable
|
$
|
978
|
|
|
$
|
—
|
|
|
$
|
9,901
|
|
|
$
|
5,372
|
|
|
$
|
—
|
|
|
$
|
16,251
|
|
Accrued expenses
|
2,399
|
|
|
114
|
|
|
6,069
|
|
|
2,807
|
|
|
—
|
|
|
11,389
|
|
||||||
Due to affiliate
|
408,266
|
|
|
—
|
|
|
—
|
|
|
14,896
|
|
|
(422,904
|
)
|
|
258
|
|
||||||
Ad valorem taxes payable
|
16
|
|
|
—
|
|
|
9,717
|
|
|
855
|
|
|
—
|
|
|
10,588
|
|
||||||
Accrued interest
|
—
|
|
|
17,483
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
17,483
|
|
||||||
Accrued environmental remediation
|
—
|
|
|
—
|
|
|
—
|
|
|
4,301
|
|
|
—
|
|
|
4,301
|
|
||||||
Other current liabilities
|
6,718
|
|
|
—
|
|
|
3,798
|
|
|
955
|
|
|
—
|
|
|
11,471
|
|
||||||
Total current liabilities
|
418,377
|
|
|
17,597
|
|
|
29,485
|
|
|
29,186
|
|
|
(422,904
|
)
|
|
71,741
|
|
||||||
Long-term debt
|
—
|
|
|
1,240,301
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,240,301
|
|
||||||
Deferred Purchase Price Obligation
|
563,281
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
563,281
|
|
||||||
Deferred revenue
|
—
|
|
|
—
|
|
|
57,465
|
|
|
—
|
|
|
—
|
|
|
57,465
|
|
||||||
Noncurrent accrued environmental remediation
|
—
|
|
|
—
|
|
|
—
|
|
|
5,152
|
|
|
—
|
|
|
5,152
|
|
||||||
Other noncurrent liabilities
|
2,858
|
|
|
—
|
|
|
4,602
|
|
|
106
|
|
|
—
|
|
|
7,566
|
|
||||||
Total liabilities
|
984,516
|
|
|
1,257,898
|
|
|
91,552
|
|
|
34,444
|
|
|
(422,904
|
)
|
|
1,945,506
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Total partners' capital
|
1,169,673
|
|
|
2,132,757
|
|
|
2,229,461
|
|
|
1,117,932
|
|
|
(5,480,150
|
)
|
|
1,169,673
|
|
||||||
Total liabilities and partners' capital
|
$
|
2,154,189
|
|
|
$
|
3,390,655
|
|
|
$
|
2,321,013
|
|
|
$
|
1,152,376
|
|
|
$
|
(5,903,054
|
)
|
|
$
|
3,115,179
|
|
|
Three months ended March 31, 2017
|
||||||||||||||||||||||
|
SMLP
|
|
Co-Issuers
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Consolidating adjustments
|
|
Total
|
||||||||||||
|
(In thousands)
|
||||||||||||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Gathering services and related fees
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
100,682
|
|
|
$
|
17,331
|
|
|
$
|
—
|
|
|
$
|
118,013
|
|
Natural gas, NGLs and condensate sales
|
—
|
|
|
—
|
|
|
11,120
|
|
|
—
|
|
|
—
|
|
|
11,120
|
|
||||||
Other revenues
|
—
|
|
|
—
|
|
|
5,961
|
|
|
711
|
|
|
—
|
|
|
6,672
|
|
||||||
Total revenues
|
—
|
|
|
—
|
|
|
117,763
|
|
|
18,042
|
|
|
—
|
|
|
135,805
|
|
||||||
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cost of natural gas and NGLs
|
—
|
|
|
—
|
|
|
9,049
|
|
|
3
|
|
|
—
|
|
|
9,052
|
|
||||||
Operation and maintenance
|
—
|
|
|
—
|
|
|
20,851
|
|
|
2,841
|
|
|
—
|
|
|
23,692
|
|
||||||
General and administrative
|
—
|
|
|
—
|
|
|
12,218
|
|
|
1,914
|
|
|
—
|
|
|
14,132
|
|
||||||
Depreciation and amortization
|
154
|
|
|
—
|
|
|
24,597
|
|
|
3,818
|
|
|
—
|
|
|
28,569
|
|
||||||
Transaction costs
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Loss on asset sales, net
|
—
|
|
|
—
|
|
|
3
|
|
|
—
|
|
|
—
|
|
|
3
|
|
||||||
Long-lived asset impairment
|
—
|
|
|
—
|
|
|
—
|
|
|
284
|
|
|
—
|
|
|
284
|
|
||||||
Total costs and expenses
|
154
|
|
|
—
|
|
|
66,718
|
|
|
8,860
|
|
|
—
|
|
|
75,732
|
|
||||||
Other income
|
71
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
71
|
|
||||||
Interest expense
|
—
|
|
|
(16,716
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(16,716
|
)
|
||||||
Early extinguishment of debt
|
—
|
|
|
(22,020
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(22,020
|
)
|
||||||
Deferred Purchase Price Obligation expense
|
(20,883
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(20,883
|
)
|
||||||
(Loss) income before income taxes and loss from equity method investees
|
(20,966
|
)
|
|
(38,736
|
)
|
|
51,045
|
|
|
9,182
|
|
|
—
|
|
|
525
|
|
||||||
Income tax expense
|
(452
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(452
|
)
|
||||||
Loss from equity method investees
|
—
|
|
|
—
|
|
|
—
|
|
|
(656
|
)
|
|
—
|
|
|
(656
|
)
|
||||||
Equity in earnings of consolidated subsidiaries
|
20,835
|
|
|
59,571
|
|
|
—
|
|
|
—
|
|
|
(80,406
|
)
|
|
—
|
|
||||||
Net (loss) income
|
$
|
(583
|
)
|
|
$
|
20,835
|
|
|
$
|
51,045
|
|
|
$
|
8,526
|
|
|
$
|
(80,406
|
)
|
|
$
|
(583
|
)
|
|
Three months ended March 31, 2016
|
||||||||||||||||||||||
|
SMLP
|
|
Co-Issuers
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Consolidating adjustments
|
|
Total
|
||||||||||||
|
(In thousands)
|
||||||||||||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Gathering services and related fees
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
64,768
|
|
|
$
|
13,332
|
|
|
$
|
—
|
|
|
$
|
78,100
|
|
Natural gas, NGLs and condensate sales
|
—
|
|
|
—
|
|
|
7,588
|
|
|
—
|
|
|
—
|
|
|
7,588
|
|
||||||
Other revenues
|
—
|
|
|
—
|
|
|
4,369
|
|
|
514
|
|
|
—
|
|
|
4,883
|
|
||||||
Total revenues
|
—
|
|
|
—
|
|
|
76,725
|
|
|
13,846
|
|
|
—
|
|
|
90,571
|
|
||||||
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cost of natural gas and NGLs
|
—
|
|
|
—
|
|
|
6,290
|
|
|
—
|
|
|
—
|
|
|
6,290
|
|
||||||
Operation and maintenance
|
—
|
|
|
—
|
|
|
22,572
|
|
|
3,270
|
|
|
—
|
|
|
25,842
|
|
||||||
General and administrative
|
—
|
|
|
—
|
|
|
10,126
|
|
|
2,753
|
|
|
—
|
|
|
12,879
|
|
||||||
Depreciation and amortization
|
116
|
|
|
—
|
|
|
24,672
|
|
|
2,940
|
|
|
—
|
|
|
27,728
|
|
||||||
Transaction costs
|
1,174
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,174
|
|
||||||
Gain on asset sales, net
|
—
|
|
|
—
|
|
|
(63
|
)
|
|
—
|
|
|
—
|
|
|
(63
|
)
|
||||||
Total costs and expenses
|
1,290
|
|
|
—
|
|
|
63,597
|
|
|
8,963
|
|
|
—
|
|
|
73,850
|
|
||||||
Other income
|
22
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
22
|
|
||||||
Interest expense
|
(1,446
|
)
|
|
(14,436
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(15,882
|
)
|
||||||
Deferred Purchase Price Obligation expense
|
(7,463
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(7,463
|
)
|
||||||
(Loss) income before income taxes and loss from equity method investees
|
(10,177
|
)
|
|
(14,436
|
)
|
|
13,128
|
|
|
4,883
|
|
|
—
|
|
|
(6,602
|
)
|
||||||
Income tax benefit
|
77
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
77
|
|
||||||
Income from equity method investees
|
—
|
|
|
—
|
|
|
—
|
|
|
2,860
|
|
|
—
|
|
|
2,860
|
|
||||||
Equity in earnings of consolidated subsidiaries
|
6,435
|
|
|
20,871
|
|
|
—
|
|
|
—
|
|
|
(27,306
|
)
|
|
—
|
|
||||||
Net (loss) income
|
$
|
(3,665
|
)
|
|
$
|
6,435
|
|
|
$
|
13,128
|
|
|
$
|
7,743
|
|
|
$
|
(27,306
|
)
|
|
$
|
(3,665
|
)
|
|
Three months ended March 31, 2017
|
||||||||||||||||||||||
|
SMLP
|
|
Co-Issuers
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Consolidating adjustments
|
|
Total
|
||||||||||||
|
(In thousands)
|
||||||||||||||||||||||
Cash flows from operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net cash (used in) provided by operating activities
|
$
|
(2,021
|
)
|
|
$
|
(27,574
|
)
|
|
$
|
74,721
|
|
|
$
|
17,323
|
|
|
$
|
—
|
|
|
$
|
62,449
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Capital expenditures
|
(1,003
|
)
|
|
—
|
|
|
(4,580
|
)
|
|
(8,845
|
)
|
|
—
|
|
|
(14,428
|
)
|
||||||
Contributions to equity method investees
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,936
|
)
|
|
—
|
|
|
(4,936
|
)
|
||||||
Other, net
|
(361
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(361
|
)
|
||||||
Advances to affiliates
|
(25,266
|
)
|
|
—
|
|
|
(72,972
|
)
|
|
(4,184
|
)
|
|
102,422
|
|
|
—
|
|
||||||
Net cash used in investing activities
|
(26,630
|
)
|
|
—
|
|
|
(77,552
|
)
|
|
(17,965
|
)
|
|
102,422
|
|
|
(19,725
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Distributions to unitholders
|
(44,452
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(44,452
|
)
|
||||||
Borrowings under Revolving Credit Facility
|
—
|
|
|
72,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
72,000
|
|
||||||
Repayments under Revolving Credit Facility
|
—
|
|
|
(245,000
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(245,000
|
)
|
||||||
Debt issuance costs
|
—
|
|
|
(6,825
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6,825
|
)
|
||||||
Payment of redemption and call premiums on senior notes
|
—
|
|
|
(17,913
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(17,913
|
)
|
||||||
Proceeds from ATM Program issuances, net of costs
|
367
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
367
|
|
||||||
Contribution from General Partner
|
113
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
113
|
|
||||||
Issuance of senior notes
|
—
|
|
|
500,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
500,000
|
|
||||||
Tender and redemption of senior notes
|
—
|
|
|
(300,000
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(300,000
|
)
|
||||||
Other, net
|
(2,051
|
)
|
|
—
|
|
|
(91
|
)
|
|
(15
|
)
|
|
—
|
|
|
(2,157
|
)
|
||||||
Advances from affiliates
|
77,156
|
|
|
25,266
|
|
|
—
|
|
|
—
|
|
|
(102,422
|
)
|
|
—
|
|
||||||
Net cash provided by (used in) financing activities
|
31,133
|
|
|
27,528
|
|
|
(91
|
)
|
|
(15
|
)
|
|
(102,422
|
)
|
|
(43,867
|
)
|
||||||
Net change in cash and cash equivalents
|
2,482
|
|
|
(46
|
)
|
|
(2,922
|
)
|
|
(657
|
)
|
|
—
|
|
|
(1,143
|
)
|
||||||
Cash and cash equivalents, beginning of period
|
698
|
|
|
51
|
|
|
5,647
|
|
|
1,032
|
|
|
—
|
|
|
7,428
|
|
||||||
Cash and cash equivalents, end of period
|
$
|
3,180
|
|
|
$
|
5
|
|
|
$
|
2,725
|
|
|
$
|
375
|
|
|
$
|
—
|
|
|
$
|
6,285
|
|
|
Three months ended March 31, 2016
|
||||||||||||||||||||||
|
SMLP
|
|
Co-Issuers
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Consolidating adjustments
|
|
Total
|
||||||||||||
|
(In thousands)
|
||||||||||||||||||||||
Cash flows from operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net cash (used in) provided by operating activities
|
$
|
(3,174
|
)
|
|
$
|
(23,280
|
)
|
|
$
|
65,022
|
|
|
$
|
28,281
|
|
|
$
|
—
|
|
|
$
|
66,849
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Capital expenditures
|
(180
|
)
|
|
—
|
|
|
(11,753
|
)
|
|
(49,393
|
)
|
|
—
|
|
|
(61,326
|
)
|
||||||
Contributions to equity method investees
|
—
|
|
|
—
|
|
|
—
|
|
|
(15,645
|
)
|
|
—
|
|
|
(15,645
|
)
|
||||||
Acquisitions of gathering systems from affiliate
|
(360,000
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(360,000
|
)
|
||||||
Other, net
|
(377
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(377
|
)
|
||||||
Advances to affiliates
|
(13,446
|
)
|
|
(363,390
|
)
|
|
(55,177
|
)
|
|
—
|
|
|
432,013
|
|
|
—
|
|
||||||
Net cash used in investing activities
|
(374,003
|
)
|
|
(363,390
|
)
|
|
(66,930
|
)
|
|
(65,038
|
)
|
|
432,013
|
|
|
(437,348
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Distributions to unitholders
|
(40,975
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(40,975
|
)
|
||||||
Borrowings under Revolving Credit Facility
|
12,000
|
|
|
412,300
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
424,300
|
|
||||||
Repayments under Revolving Credit Facility
|
—
|
|
|
(35,300
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(35,300
|
)
|
||||||
Debt issuance costs
|
(13
|
)
|
|
(2,400
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,413
|
)
|
||||||
Cash advance from Summit Investments to contributed subsidiaries, net
|
(12,000
|
)
|
|
—
|
|
|
—
|
|
|
24,214
|
|
|
—
|
|
|
12,214
|
|
||||||
Expenses paid by Summit Investments on behalf of contributed subsidiaries
|
3,030
|
|
|
—
|
|
|
—
|
|
|
1,791
|
|
|
—
|
|
|
4,821
|
|
||||||
Other, net
|
(786
|
)
|
|
—
|
|
|
(68
|
)
|
|
—
|
|
|
—
|
|
|
(854
|
)
|
||||||
Advances from affiliates
|
418,566
|
|
|
—
|
|
|
—
|
|
|
13,447
|
|
|
(432,013
|
)
|
|
—
|
|
||||||
Net cash provided by (used in) financing activities
|
379,822
|
|
|
374,600
|
|
|
(68
|
)
|
|
39,452
|
|
|
(432,013
|
)
|
|
361,793
|
|
||||||
Net change in cash and cash equivalents
|
2,645
|
|
|
(12,070
|
)
|
|
(1,976
|
)
|
|
2,695
|
|
|
—
|
|
|
(8,706
|
)
|
||||||
Cash and cash equivalents, beginning of period
|
73
|
|
|
12,407
|
|
|
6,930
|
|
|
2,383
|
|
|
—
|
|
|
21,793
|
|
||||||
Cash and cash equivalents, end of period
|
$
|
2,718
|
|
|
$
|
337
|
|
|
$
|
4,954
|
|
|
$
|
5,078
|
|
|
$
|
—
|
|
|
$
|
13,087
|
|
•
|
•
|
•
|
•
|
•
|
•
|
•
|
•
|
Ohio Gathering, a natural gas gathering system and a condensate stabilization facility operating in the Appalachian Basin, which includes the Utica and Point Pleasant shale formations in southeastern Ohio;
|
•
|
Summit Utica, a natural gas gathering system operating in the Appalachian Basin, which includes the Utica and Point Pleasant shale formations in southeastern Ohio;
|
•
|
Bison Midstream, an associated natural gas gathering system operating in the Williston Basin, which includes the Bakken and Three Forks shale formations in northwestern North Dakota;
|
•
|
Polar and Divide, crude oil and produced water gathering systems and transmission pipelines located in the Williston Basin, which includes the Bakken and Three Forks shale formations in northwestern North Dakota;
|
•
|
Tioga Midstream, crude oil, produced water and associated natural gas gathering systems operating in the Williston Basin, which includes the Bakken and Three Forks shale formations in northwestern North Dakota;
|
•
|
Grand River, a natural gas gathering and processing system located in the Piceance Basin, which includes the Mesaverde formation and the Mancos and Niobrara shale formations in western Colorado and eastern Utah;
|
•
|
Niobrara G&P, an associated natural gas gathering and processing system operating in the DJ Basin, which includes the Niobrara and Codell shale formations in northeastern Colorado;
|
•
|
DFW Midstream, a natural gas gathering system operating in the Fort Worth Basin, which includes the Barnett Shale formation in north-central Texas; and
|
•
|
Mountaineer Midstream, a natural gas gathering system operating in the Appalachian Basin, which includes the Marcellus Shale formation in northern West Virginia.
|
|
Three month ended March 31,
|
||||||
|
2017
|
|
2016
|
||||
|
(In thousands)
|
||||||
Net loss
|
$
|
(583
|
)
|
|
$
|
(3,665
|
)
|
Reportable segment adjusted EBITDA:
|
|
|
|
||||
Utica Shale (1)
|
16,985
|
|
|
15,577
|
|
||
Williston Basin
|
17,809
|
|
|
19,719
|
|
||
Piceance/DJ Basins
|
28,974
|
|
|
24,817
|
|
||
Barnett Shale
|
12,088
|
|
|
14,077
|
|
||
Marcellus Shale
|
5,647
|
|
|
4,600
|
|
||
|
|
|
|
||||
Net cash provided by operating activities
|
$
|
62,449
|
|
|
$
|
66,849
|
|
Acquisitions of gathering systems (2)
|
—
|
|
|
867,427
|
|
||
Capital expenditures (3)
|
14,428
|
|
|
61,326
|
|
||
Contributions to equity method investees
|
4,936
|
|
|
15,645
|
|
||
|
|
|
|
||||
Distributions to unitholders
|
$
|
44,452
|
|
|
$
|
40,975
|
|
Issuance of senior notes
|
500,000
|
|
|
—
|
|
||
Tender and redemption of senior notes
|
(300,000
|
)
|
|
—
|
|
||
Net (repayments) borrowings under Revolving Credit Facility
|
(173,000
|
)
|
|
389,000
|
|
•
|
In March 2017, we recognized $37.7 million of gathering services and related fees revenue that had been previously deferred in connection with an MVC arrangement with a certain Williston Basin customer, for which we determined we had no further performance obligations. We include the effect of adjustments related to MVC shortfall payments in our definition of segment adjusted EBITDA. As such, the Williston Basin segment adjusted EBITDA was not impacted because the revenue recognition was offset by the
|
•
|
In
February 2017
, we amended the 2014 SRS to include additional guarantor subsidiaries and completed a public offering of
$500.0 million
principal 5.75% Senior Notes. Concurrent and following the offering, we tendered and redeemed all of the outstanding 7.5% Senior Notes. The remaining 7.5% Senior Notes were redeemed on March 18, 2017, with payment made on March 20, 2017. We used the proceeds from the issuance of the 5.75% Senior Notes to (i) fund the repurchase of the outstanding
$300.0 million
principal 7.5% Senior Notes, (ii) pay redemption and call premiums on the 7.5% Senior Notes totaling
$17.9 million
and (iii) pay
$172.0 million
of the balance outstanding under our Revolving Credit Facility.
|
•
|
In March 2016, we acquired the 2016 Drop Down Assets from a subsidiary of Summit Investments. We funded the drop down with borrowings under our revolving credit facility and the execution of the Deferred Purchase Price Obligation with Summit Investments (see Note 16 to the unaudited condensed consolidated financial statements).
|
•
|
Natural gas, NGL and crude oil supply and demand dynamics;
|
•
|
Growth in production from U.S. shale plays;
|
•
|
Capital markets activity and cost of capital; and
|
•
|
Shifts in operating costs and inflation.
|
•
|
the Utica Shale, which includes our ownership interest in Ohio Gathering and is served by Summit Utica;
|
•
|
the Williston Basin, which is served by Bison Midstream, Polar and Divide and Tioga Midstream;
|
•
|
the Piceance/DJ Basins, which is served by Grand River and Niobrara G&P;
|
•
|
the Barnett Shale, which is served by DFW Midstream; and
|
•
|
the Marcellus Shale, which is served by Mountaineer Midstream.
|
•
|
throughput volume,
|
•
|
revenues,
|
•
|
operation and maintenance expenses and
|
•
|
segment adjusted EBITDA.
|
|
Three months ended
March 31,
|
||||||
|
2017
|
|
2016
|
||||
|
(Dollars in thousands)
|
||||||
Revenues:
|
|
|
|
||||
Gathering services and related fees
|
$
|
118,013
|
|
|
$
|
78,100
|
|
Natural gas, NGLs and condensate sales
|
11,120
|
|
|
7,588
|
|
||
Other revenues
|
6,672
|
|
|
4,883
|
|
||
Total revenues
|
135,805
|
|
|
90,571
|
|
||
Costs and expenses:
|
|
|
|
||||
Cost of natural gas and NGLs
|
9,052
|
|
|
6,290
|
|
||
Operation and maintenance
|
23,692
|
|
|
25,842
|
|
||
General and administrative
|
14,132
|
|
|
12,879
|
|
||
Depreciation and amortization
|
28,569
|
|
|
27,728
|
|
||
Transaction costs
|
—
|
|
|
1,174
|
|
||
Loss (gain) on asset sales, net
|
3
|
|
|
(63
|
)
|
||
Long-lived asset impairment
|
284
|
|
|
—
|
|
||
Total costs and expenses
|
75,732
|
|
|
73,850
|
|
||
Other income
|
71
|
|
|
22
|
|
||
Interest expense
|
(16,716
|
)
|
|
(15,882
|
)
|
||
Early extinguishment of debt
|
(22,020
|
)
|
|
—
|
|
||
Deferred Purchase Price Obligation expense
|
(20,883
|
)
|
|
(7,463
|
)
|
||
Income (loss) before income taxes and (loss) income from equity method investees
|
525
|
|
|
(6,602
|
)
|
||
Income tax (expense) benefit
|
(452
|
)
|
|
77
|
|
||
(Loss) income from equity method investees
|
(656
|
)
|
|
2,860
|
|
||
Net loss
|
$
|
(583
|
)
|
|
$
|
(3,665
|
)
|
|
|
|
|
||||
Volume throughput:
|
|
|
|
||||
Aggregate average daily throughput – natural gas (MMcf/d) (1)
|
1,627
|
|
|
1,523
|
|
||
Aggregate average daily throughput – liquids (Mbbl/d)
|
76.4
|
|
|
95.0
|
|
•
|
a volume throughput increase of 143 MMcf/d on the Summit Utica system for the Utica Shale segment.
|
•
|
a volume throughput increase of 43 MMcf/d for the Piceance/DJ Basins segment.
|
•
|
a volume throughput decrease of 55 MMcf/d for the Barnett Shale segment.
|
•
|
a volume throughput decrease of 19 MMcf/d for the Marcellus Shale segment.
|
•
|
the recognition of $37.7 million of previously deferred revenue related to a certain Williston Basin customer.
|
•
|
the recognition of $2.6 million of business interruption recoveries for the Williston Basin segment.
|
•
|
a
$4.5 million
increase for the Utica Shale segment due to the ongoing development of the Summit Utica system.
|
•
|
a
$3.5 million
increase in natural gas, NGLs and condensate sales primarily due to increases for the Williston Basin and Piceance/DJ Basins segments primarily as a result of higher commodity prices and the addition of natural gas and crude oil marketing services provided for the Piceance/DJ Basins segment.
|
•
|
a
$3.9 million
increase in gathering services and related fees for the Piceance/DJ Basins segment primarily as a result of ongoing drilling and completion activity.
|
•
|
a
$4.7 million
decrease, net of the recognition for the above-mentioned previously deferred revenue and business interruption recoveries, in gathering services and related fees for the Williston Basin segment primarily due to decreased drilling activity and natural production declines.
|
•
|
a $2.7 million decrease for the Barnett Shale segment primarily due to lower volume throughput on the DFW Midstream system.
|
•
|
the recognition of $37.7 million of previously deferred revenue related to a certain Williston Basin customer.
|
•
|
the recognition of $2.6 million of business interruption recoveries for the Williston Basin segment.
|
•
|
a
$4.5 million
increase for the Utica Shale segment due to the ongoing development of the Summit Utica system.
|
•
|
a
$3.9 million
increase for the Piceance/DJ Basins segment primarily as a result of ongoing drilling and completion activity.
|
•
|
a
$4.7 million
decrease, net of the recognition for the above-mentioned previously deferred revenue and business interruption recoveries, for the Williston Basin segment primarily due to decreased drilling activity and natural production declines.
|
•
|
a
$4.0 million
decrease for the Barnett Shale segment primarily due to lower volume throughput on the DFW Midstream system.
|
•
|
a
$2.8 million
increase in cost of natural gas and NGLs primarily for the Williston Basin and Piceance/DJ Basins segments primarily due to the impact of increasing commodity prices on their percent-of-proceeds and condensate sales activity.
|
•
|
a
$1.3 million
increase in general and administrative expenses reflecting an increase in salaries and benefits.
|
•
|
a
$2.2 million
decrease in operation and maintenance expenses primarily due to costs associated with repairs to rights-of-way in the Marcellus Shale segment and certain environmental remediation expenses in the Williston Basin segment recognized in 2016.
|
|
Utica Shale
|
|||||||
|
Three months ended March 31,
|
|
Percentage Change
|
|||||
|
2017
|
|
2016
|
|
2017 v. 2016
|
|||
Ohio Gathering average daily throughput (MMcf/d) (1)
|
769
|
|
|
870
|
|
|
(12
|
)%
|
|
|
|
|
|
|
|||
Average daily throughput (MMcf/d) (2)
|
275
|
|
|
132
|
|
|
108
|
%
|
|
Utica Shale
|
|||||||||
|
Three months ended
March 31,
|
|
Percentage Change
|
|||||||
|
2017
|
|
2016
|
|
2017 v. 2016
|
|||||
|
(Dollars in thousands)
|
|||||||||
Revenues:
|
|
|
|
|
|
|||||
Gathering services and related fees (1)
|
$
|
8,796
|
|
|
$
|
4,283
|
|
|
105
|
%
|
Total revenues
|
8,796
|
|
|
4,283
|
|
|
105
|
%
|
||
Costs and expenses:
|
|
|
|
|
|
|||||
Operation and maintenance
|
763
|
|
|
525
|
|
|
45
|
%
|
||
General and administrative
|
121
|
|
|
569
|
|
|
(79
|
)%
|
||
Depreciation and amortization
|
1,647
|
|
|
844
|
|
|
95
|
%
|
||
Long-lived asset impairment
|
284
|
|
|
—
|
|
|
*
|
|
||
Total costs and expenses
|
2,815
|
|
|
1,938
|
|
|
45
|
%
|
||
Add:
|
|
|
|
|
|
|||||
Proportional adjusted EBITDA for equity method investees (2)
|
9,073
|
|
|
12,388
|
|
|
|
|||
Depreciation and amortization
|
1,647
|
|
|
844
|
|
|
|
|||
Long-lived asset impairment
|
284
|
|
|
—
|
|
|
|
|||
Segment adjusted EBITDA
|
$
|
16,985
|
|
|
$
|
15,577
|
|
|
9
|
%
|
•
|
a $4.5 million increase in gathering services and related fees primarily due to the growth and ongoing development of the Summit Utica system.
|
•
|
a $3.3 million decrease in our proportional share of Ohio Gathering's adjusted EBITDA primarily due to decreased drilling activity and natural production declines.
|
•
|
Depreciation and amortization increased compared to the first quarter of 2016 as a result of placing assets into service in the Summit Utica system.
|
|
Williston Basin
|
|||||||
|
Three months ended
March 31,
|
Percentage Change
|
||||||
|
2017
|
|
2016
|
|
2017 v. 2016
|
|||
Aggregate average daily throughput – natural gas (MMcf/d)
|
17
|
|
|
25
|
|
|
(32
|
)%
|
|
|
|
|
|
|
|||
Aggregate average daily throughput – liquids (Mbbl/d)
|
76.4
|
|
|
95.0
|
|
|
(20
|
)%
|
|
Williston Basin
|
|||||||||
|
Three months ended
March 31,
|
Percentage Change
|
||||||||
|
2017
|
|
2016
|
|
2017 v. 2016
|
|||||
|
(Dollars in thousands)
|
|||||||||
Revenues:
|
|
|
|
|
|
|||||
Gathering services and related fees
|
$
|
57,985
|
|
|
$
|
22,415
|
|
|
159
|
%
|
Natural gas, NGLs and condensate sales
|
6,158
|
|
|
4,276
|
|
|
44
|
%
|
||
Other revenues
|
2,742
|
|
|
3,317
|
|
|
(17
|
)%
|
||
Total revenues
|
66,885
|
|
|
30,008
|
|
|
123
|
%
|
||
Costs and expenses:
|
|
|
|
|
|
|||||
Cost of natural gas and NGLs
|
6,362
|
|
|
4,626
|
|
|
38
|
%
|
||
Operation and maintenance
|
6,463
|
|
|
8,210
|
|
|
(21
|
)%
|
||
General and administrative
|
540
|
|
|
989
|
|
|
(45
|
)%
|
||
Depreciation and amortization
|
8,381
|
|
|
8,357
|
|
|
—
|
%
|
||
Loss on asset sales, net
|
3
|
|
|
—
|
|
|
*
|
|
||
Total costs and expenses
|
21,749
|
|
|
22,182
|
|
|
(2
|
)%
|
||
Add:
|
|
|
|
|
|
|||||
Depreciation and amortization
|
8,381
|
|
|
8,357
|
|
|
|
|||
Adjustments related to MVC shortfall payments
|
(35,711
|
)
|
|
3,536
|
|
|
|
|||
Loss on asset sales, net
|
3
|
|
|
—
|
|
|
|
|||
Segment adjusted EBITDA
|
$
|
17,809
|
|
|
$
|
19,719
|
|
|
(10
|
)%
|
•
|
a $4.7 million decrease, after taking into account the recognition of $37.7 million of previously deferred revenue and $2.6 million of business interruption recoveries, in gathering services and related fees primarily due to natural production declines and a lower rate redetermination for a certain Williston Basin customer.
|
•
|
a $1.7 million decrease in operation and maintenance expenses primarily due to costs associated with certain environmental remediation expenses recognized in 2016.
|
•
|
The recognition of $37.7 million of previously deferred revenue related to a certain Williston Basin customer.
|
•
|
The adjustments for MVC shortfall payments is primarily driven by the recognition of $37.7 million of gathering services and related fees revenue that had been previously deferred in connection with an MVC arrangement with a certain Williston Basin customer, for which we determined we had no further performance obligations. As a result, the increase in gathering services and related fees compared with the first quarter 2016 was offset by the change in adjustments related to MVC shortfall payments, with no impact on segment adjusted EBITDA (see Note 8 to the consolidated financial statements).
|
|
Piceance/DJ Basins
|
|||||||
|
Three months ended
March 31,
|
Percentage Change
|
||||||
|
2017
|
|
2016
|
|
2017 v. 2016
|
|||
Aggregate average daily throughput (MMcf/d)
|
615
|
|
|
572
|
|
|
8
|
%
|
|
Piceance/DJ Basins
|
|||||||||
|
Three months ended
March 31,
|
Percentage Change
|
||||||||
|
2017
|
|
2016
|
|
2017 v. 2016
|
|||||
|
(Dollars in thousands)
|
|||||||||
Revenues:
|
|
|
|
|
|
|||||
Gathering services and related fees
|
$
|
29,274
|
|
|
$
|
25,392
|
|
|
15
|
%
|
Natural gas, NGLs and condensate sales
|
3,757
|
|
|
2,203
|
|
|
71
|
%
|
||
Other revenues
|
1,777
|
|
|
1,398
|
|
|
27
|
%
|
||
Total revenues
|
34,808
|
|
|
28,993
|
|
|
20
|
%
|
||
Costs and expenses:
|
|
|
|
|
|
|||||
Cost of natural gas and NGLs
|
2,183
|
|
|
1,664
|
|
|
31
|
%
|
||
Operation and maintenance
|
8,779
|
|
|
8,597
|
|
|
2
|
%
|
||
General and administrative
|
625
|
|
|
1,432
|
|
|
(56
|
)%
|
||
Depreciation and amortization
|
12,211
|
|
|
12,273
|
|
|
(1
|
)%
|
||
Gain on asset sales, net
|
—
|
|
|
(63
|
)
|
|
*
|
|
||
Total costs and expenses
|
23,798
|
|
|
23,903
|
|
|
—
|
%
|
||
Add:
|
|
|
|
|
|
|||||
Depreciation and amortization
|
12,211
|
|
|
12,273
|
|
|
|
|||
Adjustments related to MVC shortfall payments
|
5,753
|
|
|
7,517
|
|
|
|
|||
Gain on asset sales, net
|
—
|
|
|
(63
|
)
|
|
|
|||
Segment adjusted EBITDA
|
$
|
28,974
|
|
|
$
|
24,817
|
|
|
17
|
%
|
•
|
a $2.1 million increase, after taking into account the adjustments related to MVC shortfall payments, in gathering services and related fees primarily as a result of volume growth from ongoing drilling and completion activity.
|
•
|
a $1.6 million increase in natural gas, NGLs and condensate sales due to higher commodity prices and the addition of marketing services, offset by a $0.5 million increase in cost of natural gas and NGLs.
|
|
Barnett Shale
|
|||||||
|
Three months ended
March 31,
|
Percentage Change
|
||||||
|
2017
|
|
2016
|
|
2017 v. 2016
|
|||
Average daily throughput (MMcf/d)
|
286
|
|
|
341
|
|
|
(16
|
)%
|
|
Barnett Shale
|
|||||||||
|
Three months ended
March 31,
|
Percentage Change
|
||||||||
|
2017
|
|
2016
|
|
2017 v. 2016
|
|||||
|
(Dollars in thousands)
|
|||||||||
Revenues:
|
|
|
|
|
|
|||||
Gathering services and related fees
|
$
|
15,124
|
|
|
$
|
19,125
|
|
|
(21
|
)%
|
Natural gas, NGLs and condensate sales
|
459
|
|
|
1,109
|
|
|
(59
|
)%
|
||
Other revenues
|
2,159
|
|
|
168
|
|
|
*
|
|
||
Total revenues
|
17,742
|
|
|
20,402
|
|
|
(13
|
)%
|
||
Costs and expenses:
|
|
|
|
|
|
|||||
Operation and maintenance
|
6,532
|
|
|
6,314
|
|
|
3
|
%
|
||
General and administrative
|
289
|
|
|
237
|
|
|
22
|
%
|
||
Depreciation and amortization
|
3,913
|
|
|
3,919
|
|
|
—
|
%
|
||
Total costs and expenses
|
10,734
|
|
|
10,470
|
|
|
3
|
%
|
||
Add:
|
|
|
|
|
|
|||||
Depreciation and amortization
|
3,762
|
|
|
4,056
|
|
|
|
|||
Adjustments related to MVC shortfall payments
|
1,318
|
|
|
89
|
|
|
|
|||
Segment adjusted EBITDA
|
$
|
12,088
|
|
|
$
|
14,077
|
|
|
(14
|
)%
|
•
|
a $4.0 million decrease in gathering services and related fees largely as a result of reduced drilling activity and natural production declines.
|
•
|
a $2.0 million increase in other revenues primarily due to electricity expense reimbursements that we began passing through to certain customers beginning in the fourth quarter of 2016.
|
|
Marcellus Shale
|
|||||||
|
Three months ended
March 31,
|
Percentage Change
|
||||||
|
2017
|
|
2016
|
|
2017 v. 2016
|
|||
Average daily throughput (MMcf/d)
|
434
|
|
|
453
|
|
|
(4
|
)%
|
|
Marcellus Shale
|
|||||||||
|
Three months ended
March 31,
|
Percentage Change
|
||||||||
|
2017
|
|
2016
|
|
2017 v. 2016
|
|||||
|
(Dollars in thousands)
|
|||||||||
Revenues:
|
|
|
|
|
|
|||||
Gathering services and related fees
|
$
|
6,904
|
|
|
$
|
6,885
|
|
|
—
|
%
|
Total revenues
|
6,904
|
|
|
6,885
|
|
|
—
|
%
|
||
Costs and expenses:
|
|
|
|
|
|
|||||
Operation and maintenance
|
1,158
|
|
|
2,196
|
|
|
(47
|
)%
|
||
General and administrative
|
99
|
|
|
89
|
|
|
11
|
%
|
||
Depreciation and amortization
|
2,263
|
|
|
2,219
|
|
|
2
|
%
|
||
Total costs and expenses
|
3,520
|
|
|
4,504
|
|
|
(22
|
)%
|
||
Add:
|
|
|
|
|
|
|||||
Depreciation and amortization
|
2,263
|
|
|
2,219
|
|
|
|
|||
Segment adjusted EBITDA
|
$
|
5,647
|
|
|
$
|
4,600
|
|
|
23
|
%
|
•
|
a $1.0 million decrease in operation and maintenance primarily as a result of a decrease in expenses associated with repairs to rights-of-way in 2016.
|
|
Corporate and Other
|
|||||||||
|
Three months ended
March 31,
|
Percentage Change
|
||||||||
|
2017
|
|
2016
|
|
2017 v. 2016
|
|||||
|
(Dollars in thousands)
|
|||||||||
Costs and expenses:
|
|
|
|
|
|
|||||
General and administrative
|
$
|
12,458
|
|
|
$
|
9,563
|
|
|
30
|
%
|
Transaction costs
|
—
|
|
|
1,174
|
|
|
*
|
|
||
Interest expense (1)
|
16,716
|
|
|
15,882
|
|
|
5
|
%
|
||
Early extinguishment of debt (2)
|
22,020
|
|
|
—
|
|
|
*
|
|
||
Deferred Purchase Price Obligation expense
|
20,883
|
|
|
7,463
|
|
|
*
|
|
•
|
In January 2017, we completed a secondary public offering of 4,000,000 SMLP common units held by a subsidiary of Summit Investments in accordance with our obligations under our partnership agreement. We did not receive any proceeds from this secondary offering.
|
•
|
In February 2017, we executed a new equity distribution agreement and filed a prospectus and a prospectus supplement with the SEC for the issuance and sale from time to time of SMLP common units having an aggregate offering price of up to $150.0 million. During the three months ended March 31, 2017, we issued 17,700 units under the ATM Program for aggregate gross proceeds of
$0.4 million
. In March 2017, in accordance with the terms of our Partnership Agreement, our General Partner made a capital contribution to maintain its 2% general partner interest in SMLP.
|
|
Three months ended
March 31,
|
||||||
|
2017
|
|
2016
|
||||
|
(In thousands)
|
||||||
Net cash provided by operating activities
|
$
|
62,449
|
|
|
$
|
66,849
|
|
Net cash used in investing activities
|
(19,725
|
)
|
|
(437,348
|
)
|
||
Net cash (used in) provided by financing activities
|
(43,867
|
)
|
|
361,793
|
|
||
Net change in cash and cash equivalents
|
$
|
(1,143
|
)
|
|
$
|
(8,706
|
)
|
•
|
a
$2.9 million
decrease in distributions from Ohio Gathering; and
|
•
|
a
$2.9 million
increase in cash interest payments.
|
•
|
$14.4 million
of capital expenditures primarily attributable to the ongoing development of the Summit Utica system; and
|
•
|
$4.9 million
of capital contributions to Ohio Gathering.
|
•
|
$360.0 million
consideration paid and recognized in connection with the 2016 Drop Down;
|
•
|
$61.3 million
of capital expenditures primarily attributable to the ongoing development of the Summit Utica system and Williston Basin segment; and
|
•
|
$15.6 million
of capital contributions to Ohio Gathering.
|
•
|
$300.0 million
paid for the repurchase of the outstanding 7.5% Senior Notes;
|
•
|
$17.9 million
paid for the redemption and call premiums on the 7.5% Senior Notes;
|
•
|
$173.0 million
of net repayments under our Revolving Credit Facility;
|
•
|
$44.5 million
of distributions paid in the first quarter of 2017 (declared in respect of the fourth quarter of 2016); and
|
•
|
$500.0 million
of borrowings from the issuance of 5.75% Senior Notes.
|
•
|
$389.0 million
of net borrowings under our Revolving Credit Facility primarily to fund the 2016 Drop Down; and
|
•
|
$41.0 million
of distributions paid in the first quarter of 2016 (declared in respect of the fourth quarter of 2015).
|
•
|
maintenance capital expenditures, which are cash expenditures (including expenditures for the addition or improvement to, or the replacement of, our capital assets or for the acquisition of existing, or the construction or development of new, capital assets) made to maintain our long-term operating income or operating capacity; or
|
•
|
expansion capital expenditures, which are cash expenditures incurred for acquisitions or capital improvements that we expect will increase our operating income or operating capacity over the long term.
|
•
|
fluctuations in natural gas, NGLs and crude oil prices;
|
•
|
the extent and success of our customers' drilling efforts, as well as the quantity of natural gas and crude oil volumes produced within proximity of our assets;
|
•
|
failure or delays by our customers in achieving expected production in their natural gas, crude oil and produced water projects;
|
•
|
competitive conditions in our industry and their impact on our ability to connect hydrocarbon supplies to our gathering and processing assets or systems;
|
•
|
actions or inactions taken or nonperformance by third parties, including suppliers, contractors, operators, processors, transporters and customers, including the inability or failure of our shipper customers to meet their financial obligations under our gathering agreements and our ability to enforce the terms and conditions of certain of our gathering agreements in the event of a bankruptcy of one or more of our customers;
|
•
|
our ability to acquire assets owned by third parties, which is subject to a number of factors, including prevailing conditions and outlook in the natural gas, NGL and crude oil industries and markets and our ability to obtain financing on acceptable terms;
|
•
|
our ability to consummate acquisitions, successfully integrate the acquired businesses, realize any cost savings and other synergies from any acquisition;
|
•
|
the ability to attract and retain key management personnel;
|
•
|
commercial bank and capital market conditions and the potential impact of changes or disruptions in the credit and/or capital markets;
|
•
|
changes in the availability and cost of capital and the results of our financing efforts, including availability of funds in the credit and/or capital markets;
|
•
|
restrictions placed on us by the agreements governing our debt instruments;
|
•
|
the availability, terms and cost of downstream transportation and processing services;
|
•
|
natural disasters, accidents, weather-related delays, casualty losses and other matters beyond our control;
|
•
|
operational risks and hazards inherent in the gathering, treating and/or processing of natural gas, crude oil and produced water;
|
•
|
weather conditions and terrain in certain areas in which we operate;
|
•
|
any other issues that can result in deficiencies in the design, installation or operation of our gathering, treating and processing facilities;
|
•
|
timely receipt of necessary government approvals and permits, our ability to control the costs of construction, including costs of materials, labor and rights-of-way and other factors that may impact our ability to complete projects within budget and on schedule;
|
•
|
the effects of existing and future laws and governmental regulations, including environmental, safety and climate change requirements;
|
•
|
the effects of litigation;
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•
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changes in general economic conditions; and
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•
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certain factors discussed elsewhere in this report.
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Exhibit number
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|
Description
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3.1
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First Amended and Restated Agreement of Limited Partnership of Summit Midstream Partners, LP, dated as of October 3, 2012 (Incorporated herein by reference to Exhibit 3.1 to SMLP's Current Report on Form 8-K dated October 4, 2012 (Commission File No. 001-35666))
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3.2
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Amended and Restated Limited Liability Company Agreement of Summit Midstream GP, LLC, dated as of October 3, 2012 (Incorporated herein by reference to Exhibit 3.2 to SMLP's Current Report on Form 8-K dated October 4, 2012 (Commission File No. 001-35666))
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3.3
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|
Certificate of Limited Partnership of Summit Midstream Partners, LP (Incorporated herein by reference to Exhibit 3.1 to SMLP's Form S-1 Registration Statement dated August 21, 2012 (Commission File No. 333-183466))
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3.4
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Certificate of Formation of Summit Midstream GP, LLC (Incorporated herein by reference to Exhibit 3.4 to SMLP's Form S-1 Registration Statement dated August 21, 2012 (Commission File No. 333-183466))
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4.1
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|
Second Supplemental Indenture, dated as of February 15, 2017, by and among Summit Midstream Holdings, LLC, Summit Midstream Finance Corp., the Guarantors party thereto and U.S. Bank National Association (Incorporated herein by reference to Exhibit 4.2 to SMLP's Current Report on Form 8-K dated February 17, 2017 (Commission File No. 001-35666))
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10.1
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|
Equity Distribution Agreement of Summit Midstream Partners, LP, Summit Midstream GP, LLC and Summit Midstream Holdings, LLC dated as of February 27, 2017 (Incorporated herein by reference to Exhibit 1.1 to SMLP's Current Report on Form 8-K dated February 27, 2017 (Commission File No. 001-35666))
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10.2
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*
|
Third Amended and Restated Employment Agreement, dated February 23, 2017 and effective March 1, 2017, by and between Summit Midstream Partners, LLC and Matthew S. Harrison (Incorporated herein by reference to Exhibit 10.22 to SMLP's Form 10-K filed February 27, 2017 (Commission File No. 001-35666))
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10.3
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*
|
Second Amended and Restated Employment Agreement, dated February 23, 2017 and effective March 1, 2017, by and between Summit Midstream Partners, LLC and Brad N. Graves (Incorporated herein by reference to Exhibit 10.24 to SMLP's Form 10-K filed February 27, 2017 (Commission File No. 001-35666))
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31.1
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Rule 13a-14(a)/15d-14(a) Certification, executed by Steven J. Newby, President, Chief Executive Officer and Director
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31.2
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Rule 13a-14(a)/15d-14(a) Certification, executed by Matthew S. Harrison, Executive Vice President and Chief Financial Officer
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32.1
|
|
Certifications required by Rule 13a-14(b) or Rule 15d-14(b) and Section 1350 of Chapter 63 of Title 18 of the United States Code (18 U.S.C. 1350), executed by Steven J. Newby, President, Chief Executive Officer and Director, and Matthew S. Harrison, Executive Vice President and Chief Financial Officer
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101.INS
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**
|
XBRL Instance Document (1)
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101.SCH
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**
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XBRL Taxonomy Extension Schema
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101.CAL
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**
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XBRL Taxonomy Extension Calculation Linkbase
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101.DEF
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**
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XBRL Taxonomy Extension Definition Linkbase
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101.LAB
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**
|
XBRL Taxonomy Extension Label Linkbase
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101.PRE
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**
|
XBRL Taxonomy Extension Presentation Linkbase
|
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Summit Midstream Partners, LP
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(Registrant)
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By: Summit Midstream GP, LLC (its General Partner)
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May 5, 2017
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/s/ Matthew S. Harrison
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Matthew S. Harrison, Executive Vice President and Chief Financial Officer (Principal Financial and Accounting Officer)
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1 Year Summit Midstream Partners Chart |
1 Month Summit Midstream Partners Chart |
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