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
 
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     Interest and debt expense, net of capitalized interest, for the six months
ended June 30, 2004, was approximately $11.6 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, decreased weighted average debt outstanding on our
revolving credit facility, the repayment of our GulfTerra Holding term loan
during the third quarter of 2003 and the repayment of our senior secured
acquisition term loan in March 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 already-existing senior
secured term loan.
 
     Capitalized interest for the quarter and six months ended June 30, 2004,
was $3.9 million and $7.6 million, representing increases of $1.3 million and
$3.1 million over the comparable prior periods. The increase is the result of
higher expenditures related to our construction projects, primarily the Marco
Polo natural gas and oil pipelines, the Phoenix gathering system and the Cameron
Highway oil pipeline system. This increase was partially offset by reduced
expenditures on construction projects placed into service in 2003, primarily the
Viosca Knoll pipeline extension and the Falcon Nest natural gas pipeline and
platform, and on the Marco Polo TLP which was installed in the first quarter of
2004.
 
LOSS DUE TO EARLY REDEMPTIONS OF DEBT
 
     In June 2004, we redeemed all of our outstanding $175 million aggregate
principal amount of 10 3/8% senior subordinated notes due 2009 and we recognized
a loss of $12.2 million resulting from the payment of the redemption premium and
the write-off of unamortized debt issuance costs.
 
     In April 2004, we redeemed approximately $39.1 million in principal amount
of our 8 1/2% senior subordinated notes due June 2010 and we recognized a loss
of $4.1 million resulting from the payment of the redemption premium and the
write-off of unamortized debt issuance costs.
 
     In March 2003, we repaid our $237.5 million senior secured acquisition term
loan which was due in May 2004 and recognized a loss of $3.8 million related to
the write-off of unamortized debt issuance costs related to this loan.
 
CUMULATIVE EFFECT OF ACCOUNTING CHANGE
 
     Our cumulative effect of accounting change for the six months ended June
30, 2003, reflects our adoption of SFAS No. 143, Accounting for Asset Retirement
Obligations, on January 1, 2003.
 
                         COMMITMENTS AND CONTINGENCIES
 
     See Item 1, Financial Statements, Note 9, which is incorporated herein by
reference.
 
                 NEW ACCOUNTING PRONOUNCEMENTS NOT YET ADOPTED
 
     None.
 
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