Enterprise Products Partners L.P.

SEC Filings

10-Q
GULFTERRA ENERGY PARTNERS L P filed this Form 10-Q on 08/09/2004
Entire Document
 
<PAGE>
 
  Second Quarter Ended June 30, 2004 Compared With Second Quarter Ended June 30,
  2003
 
     Performance cash flows related to other, non-segment results for the
quarter ended June 30, 2004, were $0.3 million higher than the same period in
2003 primarily due to a decrease in operating expenses in 2004 of $2.8 million
associated with the allocation of costs to our business segments. The decrease
in operating expenses was offset by the discontinuation of the quarterly
payments we received from El Paso Corporation in connection with the sale of
some of our Gulf of Mexico assets in January 2001. We received the final payment
of $2.0 million in the first quarter of 2004.
 
  Six Months Ended June 30, 2004 Compared With Six Months Ended June 30, 2003
 
     Performance cash flows related to other non-segment results for the six
months ended June 30, 2004, were $0.4 million higher than the same period in
2003 primarily due to a decrease in operating expenses in 2004 of $3.8 million
associated with the allocation of costs to our business segments. The decrease
in operating expenses was offset by the discontinuation of the quarterly
payments we received from El Paso Corporation in connection with the sale of
some of our Gulf of Mexico assets in January 2001. We received the final payment
of $2.0 million in the first quarter of 2004.
 
DEPRECIATION, DEPLETION, AND AMORTIZATION
 
     Depreciation, depletion and amortization for the quarter ended June 30,
2004 was $1.2 million higher than the same period in 2003 primarily due to an
increase in depreciation expense of $1.2 million related to assets placed in
service during 2003, including our communication assets placed in service in
October 2003 and the Viosca Knoll pipeline extension placed in service in
December 2003. Additionally, we had an increase in depreciation expense of $0.7
million associated with an increase in the costs assigned to the San Juan assets
we purchased in November 2002 as a result of the final purchase price
allocation. This increase in depreciation expense was partially offset by a
decrease in depreciation expense of $0.6 million due to our revised estimate for
the depreciable life of the Chaco plant resulting from our exchange transaction
with El Paso Corporation in October 2003.
 
     Depreciation, depletion and amortization for the six months ended June 30,
2004 was $3.8 million higher than the same period in 2003 primarily due to an
increase in depreciation expense of $2.3 million from assets placed in service
during 2003, including our communication assets placed in service in October
2003 and the Viosca Knoll pipeline extension placed in service in December 2003.
Additionally, we had an increase in depreciation expense of $0.3 million
resulting from additional capital expenditures on our Falcon Nest pipeline and
platform, $1.5 million associated with an increase in the costs assigned to the
San Juan assets we purchased in November 2002 as a result of the final purchase
price allocation and increased depletion of $0.8 million resulting from the
true-up of reserves based on revised reserve estimates. This increase in
depreciation expense was partially offset by a decrease in depreciation expense
of $1.1 million due to our revised estimate for the depreciable life of the
Chaco plant resulting from our exchange transaction with El Paso Corporation in
October 2003.
 
INTEREST AND DEBT EXPENSE
 
     Interest and debt expense, net of capitalized interest, for the quarter
ended June 30, 2004, was approximately $5.1 million lower than the same period
in 2003. This decrease is primarily due to the redemption of a portion of our
senior subordinated notes in April 2004 and December 2003 and the full
redemption of our $175 million 10 3/8% senior subordinated notes due 2009 in
June 2004. Additionally, interest and debt expense decreased as a result of
lower weighted average interest rates on our revolving credit facility and
senior secured term loan and the repayment of our GulfTerra Holding term loan
during the third quarter of 2003. Partially offsetting these decreases were
increased interest expenses associated with the additional senior secured term
loan we obtained in May 2004, the senior notes we issued in July 2003 and the
increased weighted average debt outstanding on our revolving credit facility and
our already-existing senior secured term loan.
 
                                        53