Enterprise Products Partners L.P.

SEC Filings

GULFTERRA ENERGY PARTNERS L P filed this Form 10-Q on 08/09/2004
Entire Document
                        GULFTERRA ENERGY PARTNERS, L.P.

     We are a publicly held Delaware master limited partnership (MLP)
established in 1993 for the purpose of providing midstream energy services,
including gathering, transportation, fractionation, storage and other related
activities, for producers of natural gas and oil, onshore and offshore in the
Gulf of Mexico. Our sole general partner is GulfTerra Energy Company, L.L.C., a
Delaware limited liability company that is owned 50 percent by a subsidiary of
El Paso Corporation and 50 percent by a subsidiary of Enterprise Products
Partners L.P. (Enterprise), a publicly traded MLP. References to "us", "we",
"our", or "GulfTerra" are intended to mean the consolidated business and
operations of GulfTerra Energy Partners, L.P.
     We prepared this Quarterly Report on Form 10-Q under the rules and
regulations of the United States Securities and Exchange Commission (SEC).
Because this is an interim period filing presented using a condensed format, it
does not include all of the disclosures required by generally accepted
accounting principles. You should read it along with our 2003 Annual Report on
Form 10-K, as amended, which includes a summary of our significant accounting
policies and other disclosures. The financial statements as of June 30, 2004,
and for the quarters and six months ended June 30, 2004 and 2003, are unaudited.
We derived the balance sheet as of December 31, 2003, from the audited balance
sheet filed in our 2003 Annual Report on Form 10-K, as amended. In our opinion,
we have made all adjustments, all of which are of a normal, recurring nature, to
fairly present our interim period results. Information for interim periods may
not depict the results of operations for the entire year. In addition, prior
period information presented in these financial statements includes
reclassifications which were made to conform to the current period presentation.
These reclassifications have no effect on our previously reported net income or
partners' capital.
     With respect to our Texas intrastate pipeline system, which we acquired in
April 2002, we had previously used the pre-acquisition accounting methodology
for the cash settlement of natural gas imbalance receivables, which included the
cash settlement amounts as a component of operating revenues and cost of natural
gas and other products. However, effective January 1, 2004, we have conformed
our accounting for cash settlements on that system to the same method we use to
account for imbalance receivable settlements on our other systems, which method
accounts for these types of cash settlements as an adjustment to cost of natural
gas and other products. We have determined that this revision is not material to
our previously reported financial statements. Accordingly, we have not revised
our previously filed financial statements to reflect this change in methodology.
  Unbilled Trade Receivables and Accrued Gas Purchase Costs
     As of June 30, 2004 and December 31, 2003, we had included in accounts
receivable, net on our balance sheets, unbilled trade receivables of $74.6
million and $63.1 million. Also, as of June 30, 2004 and December 31, 2003, we
had included in accounts payable on our balance sheets, accrued gas purchase
costs of $20.0 million and $15.4 million.
  Allowance for Doubtful Accounts
     We have established an allowance for losses on accounts that we believe are
uncollectible. We review collectibility regularly and adjust the allowance as
necessary, primarily under the specific identification method. As of June 30,
2004 and December 31, 2003, our allowance was $4.0 million.
As generally used in the energy industry and in this document, the following
terms have the following meanings:

<S>        <C>                                          <C>        <C>
/d         = per day                                    MBbls      = thousand barrels
Bbl        = barrel                                     MDth       = thousand dekatherms
Bcf        = billion cubic feet                         MMcf       = million cubic feet
When we refer to cubic feet measurements, all measurements are at 14.73 pounds per square inch.