Enterprise Products Partners L.P.

SEC Filings

10-K
ENTERPRISE PRODUCTS PARTNERS L P filed this Form 10-K on 02/28/2018
Entire Document
 

ENTERPRISE PRODUCTS PARTNERS L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Nonrecurring Fair Value Measurements
Long-lived assets (including intangible assets with finite useful lives and property, plant and equipment) are reviewed for impairment (i.e., subject to nonrecurring fair value measurements) when events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Long-lived assets with carrying values that are not expected to be recovered through future cash flows are written-down to their estimated fair values.

The following table summarizes our non-cash asset impairment charges for long-lived assets by segment during each of the periods indicated:

 
 
For the Year Ended December 31,
 
 
 
2017
   
2016
   
2015
 
NGL Pipelines & Services
 
$
11.5
   
$
21.0
   
$
20.8
 
Crude Oil Pipelines & Services
   
10.2
     
2.3
     
33.5
 
Natural Gas Pipelines & Services
   
14.3
     
12.3
     
21.6
 
Petrochemical & Refined Products Services
   
1.8
     
9.6
     
28.2
 
Offshore Pipelines & Services
   
--
     
--
     
58.5
 
Total
 
$
37.8
   
$
45.2
   
$
162.6
 

As presented in the following tables, our estimated fair values were based on management’s expectation of the market values for such assets based on their knowledge and experience in the industry (a Level 3 type measure involving significant unobservable inputs).  In many cases, there are no active markets (Level 1) or other similar recent transactions (Level 2) to compare to.  Our assumptions used in such analyses are based on the highest and best use of the asset and includes estimated probabilities where multiple cash flow outcomes are possible.

When probability weights are used, the weights are generally obtained from business management personnel having oversight responsibilities for the assets being tested.  Key commercial assumptions (e.g., anticipated operating margins, throughput or processing volume growth rates, timing of cash flows, etc.) that represent Level 3 unobservable inputs and test results are reviewed and certified by members of senior management.

The following table presents categories of long-lived assets, primarily property, plant and equipment, that were subject to non-recurring fair value measurements during the year ended December 31, 2017:

 
       
Fair Value Measurements
at the End of the Reporting Period Using
       
 
 
Carrying
Value at
December 31,
2017
   
Quoted Prices
in Active
Markets for
Identical
Assets
(Level 1)
   
Significant
Other
Observable
Inputs
(Level 2)
   
Significant
Unobservable
Inputs
(Level 3)
   
Total
Non-Cash
Impairment
Loss
 
Long-lived assets disposed of other than by sale
 
$
--
   
$
--
   
$
--
   
$
--
   
$
16.7
 
Long-lived assets held and used
   
1.5
     
--
     
--
     
1.5
     
15.4
 
Long-lived assets held for sale
   
2.5
     
--
     
--
     
2.5
     
2.5
 
Long-lived assets disposed of by sale
   
--
     
--
     
--
     
--
     
3.2
 
Total
                                 
$
37.8
 

Total non-cash asset impairment and related charges during 2017 were $49.8 million, which consisted of $37.8 million of impairment charges attributable to long-lived assets and $12.0 million of impairment charges attributable to the write-down of surplus materials classified as current assets.  Impairment charges attributable to long-lived assets were primarily due to the write-down of certain natural gas pipeline laterals and other pipelines in Texas, which accounted for $13.0 million in charges, and for the planned abandonment of certain storage and pipeline assets in Texas, which accounted for an additional $12.4 million in charges.

F-60