Enterprise Products Partners L.P.

SEC Filings

10-Q
TEPPCO PARTNERS LP filed this Form 10-Q on 08/07/1997
Entire Document
 
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
        RESULTS OF OPERATIONS 

RESULTS OF OPERATIONS - (CONTINUED)

        Refined products transportation revenues increased $4.6 million for the
quarter ended June 30, 1997, compared with the prior-year quarter, as a result
of higher deliveries of motor fuel, distillate, natural gasoline and jet fuel.
The increase in refined products transportation revenue reflects the
utilization of increased delivery capacity from the expansion of the Ark-La-Tex
system between Shreveport, Louisiana, and El Dorado, Arkansas, which was placed
in service on March 31, 1997, and the connection of the pipeline system to
Colonial Pipeline Company's (Colonial) pipeline at Beaumont, Texas.
Additionally, jet fuel volumes increased as a result of the pipeline connection
at the Little Rock Air Force base, which was completed in June 1996. Natural
gasoline deliveries increased primarily from favorable blending economics in
Midwest market areas. The increase in the refined products average tariff per
barrel reflects an increase in the percentage of long-haul deliveries as well
as higher tariff rates on the Ark-La-Tex system.

        LPGs transportation revenues increased $1.3 million for the quarter
ended June 30, 1997, compared with the second quarter of 1996, due primarily to
increased propane deliveries in the upper Midwest and Northeast attributable to
colder weather continuing into the second quarter of 1997, favorable price
differentials and lower competing local supply in the Northeast. Additionally,
isobutane transportation revenue increased from the prior year quarter due to
the resumption during the second quarter of 1997 of operations at a Northeast
refinery that was shut down throughout 1996. The 2% increase in the LPGs
average tariff per barrel resulted from the higher percentage of long-haul
propane and isobutane deliveries to the Northeast.

        For the six months ended June 30, 1997, refined products transportation
revenues increased $4.4 million, compared with the corresponding period in
1996, due to a 5% increase in volumes delivered and a 4% increase in the
refined products average tariff per barrel. The increase in refined products
transportation volumes was attributable to the factors discussed above during
the second quarter of 1997, partially offset by lower deliveries of motor fuel
and distillates during the first quarter of 1997 due to increased refinery
utilization in the Midwest market areas and lower refinery production along the
upper Texas Gulf Coast. The increase in the refined products average tariff per
barrel during 1997 reflects a higher percentage of long-haul transportation
deliveries and the higher tariff rate on the Ark-La-Tex system.

        LPGs transportation revenues decreased $1.8 million during the six
months ended June 30, 1997, compared with the same period in 1996, due
primarily to lower propane deliveries attributable to warmer winter weather in
the first quarter of 1997, and a decrease in butane deliveries as a result of
increased competing product being imported from Canada into the Midwest. These
decreases were partially offset by favorable price differentials of propane in
the Northeast market area during the second quarter of 1997, and stronger
demand for isobutane as a refinery feedstock due to the resumption during the
second quarter of 1997 of operations at a Northeast refinery that was shut down
throughout 1996. The 4% decrease in the LPGs average tariff per barrel resulted
from lower long-haul propane deliveries during the first quarter of 1997, as
well as increased demand for short-haul deliveries along the upper Texas Gulf
Coast.

        Revenues generated from Mont Belvieu operations increased slightly
during both the quarter and six months ended June 30, 1997, compared with the
corresponding periods in 1996, due primarily to higher terminaling fees on
butane received into the system and higher petrochemical demand along the upper
Texas Gulf Coast. These increases were largely offset by the decrease in the
Mont Belvieu operations average tariff per barrel for shuttle deliveries during
1997, which resulted from higher contract deliveries, which generally carry
lower tariffs.

        Gains on the sale of inventory decreased during both the quarter and
six months ended June 30, 1997, compared with the corresponding periods in
1996, as a result of lower volumes of gasoline being sold during the second
quarter of 1997.



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