Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2020 | Apr. 20, 2020 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2020 | |
Document Transition Report | false | |
Entity File Number | 001-13643 | |
Entity Registrant Name | ONEOK, Inc. | |
Entity Incorporation, State or Country Code | OK | |
Entity Tax Identification Number | 73-1520922 | |
Entity Address, Address Line One | 100 West Fifth Street, | |
Entity Address, City or Town | Tulsa, | |
Entity Address, State or Province | OK | |
Entity Address, Postal Zip Code | 74103 | |
City Area Code | 918 | |
Local Phone Number | 588-7000 | |
Title of 12(b) Security | Common stock, par value of $0.01 | |
Trading Symbol | OKE | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 413,907,211 | |
Entity Central Index Key | 0001039684 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Revenues | ||
Revenues | $ 2,136,672 | $ 2,779,958 |
Cost of sales and fuel (exclusive of items shown separately below) | 1,276,928 | 1,956,377 |
Operations and maintenance | 175,096 | 207,251 |
Depreciation and amortization | 132,353 | 114,158 |
Impairment charges (Note A) | 604,024 | 0 |
General taxes | 31,944 | 33,490 |
Gain on sale of assets | (204) | (60) |
Operating income (loss) | (83,469) | 468,742 |
Equity in net earnings from investments (Note I) | 44,627 | 43,481 |
Impairment of equity investments (Note A) | (37,730) | 0 |
Allowance for equity funds used during construction | 15,409 | 12,441 |
Other income | 8,522 | 9,360 |
Other expense | (3,995) | (3,462) |
Interest expense (net of capitalized interest of $30,875 and $19,192, respectively) | (140,616) | (115,420) |
Income (loss) before income taxes | (197,252) | 415,142 |
Income tax expense (benefit) | 55,395 | (77,934) |
Net income (loss) | (141,857) | 337,208 |
Less: Preferred stock dividends | 275 | 275 |
Net income (loss) available to common shareholders | $ (142,132) | $ 336,933 |
Basic earnings (loss) per common share (Note G) | $ (0.34) | $ 0.82 |
Diluted earnings (loss) per common share (Note G) | $ (0.34) | $ 0.81 |
Average shares (thousands) | ||
Basic | 414,282 | 412,908 |
Diluted | 415,348 | 415,233 |
Commodity Sales | ||
Revenues | ||
Revenues | $ 1,808,620 | $ 2,472,959 |
Services | ||
Revenues | ||
Revenues | $ 328,052 | $ 306,999 |
CONSOLIDATED STATEMENT OF INCOM
CONSOLIDATED STATEMENT OF INCOME (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Interest expense (net of capitalized interest) | $ 30,875 | $ 19,192 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Net income (loss) | $ (141,857) | $ 337,208 |
Other comprehensive income (loss), net of tax | ||
Change in fair value of derivatives, net of tax of $31,705 and $20,593, respectively | (106,141) | (68,944) |
Derivative amounts reclassified to net income (loss), net of tax of $4,518 and $4,177, respectively | (15,164) | (12,171) |
Change in retirement and other postretirement benefit plan obligations, net of tax of $(1,064) and $(699), respectively | 3,562 | 2,341 |
Other comprehensive income (loss) of unconsolidated affiliates, net of tax of $2,283 and $750, respectively | (7,643) | (2,511) |
Total other comprehensive income (loss), net of tax | (125,386) | (81,285) |
Comprehensive income (loss) | $ (267,243) | $ 255,923 |
CONSOLIDATED STATEMENTS OF CO_2
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (PARANTHETICAL) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Change in fair value of derivatives, tax | $ 31,705 | $ 20,593 |
Derivative amounts reclassified to net income (loss), tax | 4,518 | 4,177 |
Change in retirement and other postretirement benefit plan obligations, tax | (1,064) | (699) |
Other comprehensive income (loss) on investments in unconsolidated affiliates, tax | $ 2,283 | $ 750 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Current assets | ||
Cash and cash equivalents | $ 531,630 | $ 20,958 |
Accounts receivable, net | 497,556 | 835,121 |
Materials and supplies | 255,071 | 201,749 |
NGLs and natural gas in storage | 131,041 | 304,926 |
Commodity imbalances | 13,868 | 25,267 |
Other current assets | 59,116 | 82,313 |
Total current assets | 1,488,282 | 1,470,334 |
Property, plant and equipment | ||
Property, plant and equipment | 22,136,442 | 22,051,492 |
Accumulated depreciation and amortization | 3,506,950 | 3,702,807 |
Net property, plant and equipment | 18,629,492 | 18,348,685 |
Investments and other assets | ||
Investments in unconsolidated affiliates (Note A) | 810,479 | 861,844 |
Goodwill and intangible assets (Note A) | 781,544 | 957,833 |
Other assets | 259,643 | 173,425 |
Total investments and other assets | 1,851,666 | 1,993,102 |
Total assets | 21,969,440 | 21,812,121 |
Current liabilities | ||
Current maturities of long-term debt (Note D) | 7,650 | 7,650 |
Short-term borrowings (Note D) | 0 | 220,000 |
Accounts payable | 742,369 | 1,209,900 |
Commodity imbalances | 55,162 | 104,480 |
Accrued taxes | 61,057 | 75,422 |
Accrued interest | 121,832 | 190,750 |
Operating lease liability, current | 13,425 | 1,883 |
Other current liabilities | 89,897 | 210,213 |
Total current liabilities | 1,091,392 | 2,020,298 |
Long-term debt, excluding current maturities (Note D) | 14,146,650 | 12,479,757 |
Deferred credits and other liabilities | ||
Deferred income taxes | 442,653 | 536,063 |
Operating lease liability, noncurrent | 96,431 | 13,509 |
Other deferred credits | 631,673 | 536,543 |
Total deferred credits and other liabilities | 1,170,757 | 1,086,115 |
Commitments and contingencies (Note J) | ||
Equity (Note E) | ||
Preferred stock, $0.01 par value: authorized and issued 20,000 shares at March 31, 2020, and December 31, 2019 | 0 | 0 |
Common stock, $0.01 par value: authorized 1,200,000,000 shares, issued 445,016,234 shares and outstanding 413,882,720 shares at March 31, 2020; issued 445,016,234 shares and outstanding 413,239,050 shares at December 31, 2019 | 4,450 | 4,450 |
Paid-in capital | 6,989,453 | 7,403,895 |
Accumulated other comprehensive loss (Note F) | (499,386) | (374,000) |
Retained earnings (accumulated deficit) | (141,857) | 0 |
Treasury stock, at cost: 31,133,514 shares at March 31, 2020, and 31,777,184 shares at December 31, 2019 | (792,019) | (808,394) |
Total equity | 5,560,641 | 6,225,951 |
Total liabilities and equity | $ 21,969,440 | $ 21,812,121 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Mar. 31, 2020 | Dec. 31, 2019 |
Equity (Note E) | ||
Common stock, shares, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares, authorized (in shares) | 1,200,000,000 | 1,200,000,000 |
Common stock, shares, issued (in shares) | 445,016,234 | 445,016,234 |
Common stock, shares, outstanding (in shares) | 413,882,720 | 413,239,050 |
Treasury stock, shares (in shares) | 31,133,514 | 31,777,184 |
Preferred stock, shares, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares, issued (in shares) | 20,000 | 20,000 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Operating activities | ||
Net income (loss) | $ (141,857) | $ 337,208 |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||
Depreciation and amortization | 132,353 | 114,158 |
Impairment charges | 641,754 | 0 |
Equity in net earnings from investments | (44,627) | (43,481) |
Distributions received from unconsolidated affiliates | 41,577 | 45,936 |
Deferred income tax expense (benefit) | (55,949) | 75,994 |
Other, net | (30,380) | (16,144) |
Changes in assets and liabilities: | ||
Accounts receivable | 334,370 | 6,089 |
NGLs and natural gas in storage | 173,885 | 53,444 |
Accounts payable | (350,701) | (62,469) |
Accrued interest | (68,918) | (47,810) |
Risk-management assets and liabilities | (78,856) | 4,362 |
Other assets and liabilities, net | (129,930) | (113,681) |
Cash provided by operating activities | 422,721 | 353,606 |
Investing activities | ||
Capital expenditures (less allowance for equity funds used during construction) | (949,679) | (889,705) |
Distributions received from unconsolidated affiliates in excess of cumulative earnings | 6,949 | 13,527 |
Other, net | (22,062) | 11,349 |
Cash used in investing activities | (964,792) | (864,829) |
Financing activities | ||
Dividends paid | (386,667) | (354,203) |
Repayment of short-term borrowings, net | (220,000) | 0 |
Issuance of long-term debt, net of discounts | 1,748,221 | 1,442,782 |
Debt financing costs | (15,444) | (11,663) |
Repayment of long-term debt | (52,389) | (501,913) |
Other, net | (20,978) | (47,941) |
Cash provided by financing activities | 1,052,743 | 527,062 |
Change in cash and cash equivalents | 510,672 | 15,839 |
Cash and cash equivalents at beginning of period | 20,958 | 11,975 |
Cash and cash equivalents at end of period | $ 531,630 | $ 27,814 |
CONSOLIDATED STATEMENT OF CHANG
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY - USD ($) $ in Thousands | Total | Common Stock | Preferred Stock | Accumulated Other Comprehensive Loss | Retained Earnings (Accumulated Deficit) | Paid-in Capital | Treasury Stock | Noncontrolling Interest [Member] |
Shares, issued, beginning balance at Dec. 31, 2018 | 445,016,234 | 20,000 | ||||||
Total equity, beginning balance at Dec. 31, 2018 | $ 4,450 | $ 0 | $ (188,239) | $ 0 | $ 7,615,138 | $ (851,806) | $ 6,579,543 | |
Net income (loss) | $ 337,208 | 0 | 0 | 0 | 337,208 | 0 | 0 | |
Other comprehensive loss | (81,285) | 0 | 0 | (81,285) | 0 | 0 | 0 | |
Preferred stock dividends | (275) | 0 | 0 | 0 | (275) | 0 | 0 | |
Common Stock Issued During Period, Value, Other | 6,260 | 0 | 0 | 0 | 0 | (24,779) | 31,039 | |
Common Stock Dividends | (354,304) | 0 | 0 | 0 | (336,866) | (17,438) | 0 | |
Other, net | (45,074) | $ 0 | $ 0 | 0 | 0 | (45,074) | 0 | |
Shares, issued, ending balance at Mar. 31, 2019 | 445,016,234 | 20,000 | ||||||
Total equity, ending balance at Mar. 31, 2019 | $ 4,450 | $ 0 | (269,524) | 0 | 7,527,847 | (820,767) | $ 6,442,006 | |
Cumulative effect adjustment for adoption of ASU 2016-02, “Leases (Topic 842)” | (67) | $ 0 | $ 0 | 0 | (67) | 0 | 0 | |
Shares, issued, beginning balance at Dec. 31, 2019 | 445,016,234 | 20,000 | ||||||
Total equity, beginning balance at Dec. 31, 2019 | 6,225,951 | $ 4,450 | $ 0 | (374,000) | 0 | 7,403,895 | (808,394) | |
Net income (loss) | (141,857) | 0 | 0 | 0 | (141,857) | 0 | 0 | |
Other comprehensive loss | (125,386) | 0 | 0 | (125,386) | 0 | 0 | 0 | |
Preferred stock dividends | (275) | $ 0 | 0 | 0 | 0 | (275) | 0 | |
Common Stock Issued During Period, Shares, Other | 0 | |||||||
Common Stock Issued During Period, Value, Other | 7,089 | $ 0 | 0 | 0 | 0 | (9,286) | 16,375 | |
Common Stock Dividends | (386,931) | 0 | 0 | 0 | 0 | (386,931) | 0 | |
Other, net | (17,950) | $ 0 | $ 0 | 0 | 0 | (17,950) | 0 | |
Shares, issued, ending balance at Mar. 31, 2020 | 445,016,234 | 20,000 | ||||||
Total equity, ending balance at Mar. 31, 2020 | $ 5,560,641 | $ 4,450 | $ 0 | $ (499,386) | $ (141,857) | $ 6,989,453 | $ (792,019) |
CONSOLIDATED STATEMENT OF CHA_2
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY CONSOLIDATED STATEMENT OF CHANGES IN EQUITY Parenthetical - $ / shares | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Statement of Stockholders' Equity [Abstract] | ||
Preferred stock, dividends paid (in dollars per share) | $ 13.75 | $ 13.75 |
Dividends paid (in dollars per share) | $ 0.935 | $ 0.86 |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Notes) | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies [Text Block] | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Our accompanying unaudited Consolidated Financial Statements have been prepared pursuant to the rules and regulations of the SEC. These statements have been prepared in accordance with GAAP and reflect all adjustments that, in our opinion, are necessary for a fair statement of the results for the interim periods presented. All such adjustments are of a normal recurring nature. The 2019 year-end Consolidated Balance Sheet data was derived from our audited Consolidated Financial Statements but does not include all disclosures required by GAAP. Certain reclassifications have been made in the prior-year Consolidated Financial Statements to conform to the current year presentation. These unaudited Consolidated Financial Statements should be read in conjunction with our audited Consolidated Financial Statements in our Annual Report. In March 2020, the CARES Act was signed into law in response to the COVID-19 pandemic, and we opted into the CARES Act 401(k) hardship withdrawal and loan deferral programs for employees. While this legislation includes tax provisions that will modestly benefit us, we do not expect the CARES Act to materially impact us. Impairment Charges - Late in the first quarter 2020, we experienced a significant decline in our share price and market capitalization as the energy industry experienced historic events that led to a simultaneous demand and supply shock. The World Health Organization declared the novel strain of COVID-19 a global pandemic and recommended containment and mitigation measures worldwide, which contributed to a massive economic slowdown and decreased demand for crude oil. In addition, Saudi Arabia and Russia increased production of crude oil as the two countries competed for market share. As a result, the global supply of crude oil significantly exceeded demand and led to a collapse in crude oil prices. Despite recently announced production cuts from many oil producing countries, supply exceeds demand, crude oil storage is near capacity and prices remain volatile. The collapse in crude oil prices and demand for energy commodities have also contributed to lower NGL product prices and lower natural gas prices, which is creating challenges for crude oil and natural gas producers as they assess their future drilling and production plans. Based on these events, we performed a Step 1 analysis to test our goodwill for impairment and evaluated certain long-lived asset groups and equity investments for impairment. Goodwill - We assess our goodwill for impairment at least annually on July 1, unless events or changes in circumstances indicate an impairment may have occurred before that time. In the Step 1 analysis, an assessment is made by comparing the fair value of a reporting unit with its carrying amount, including goodwill. If the carrying value of a reporting unit exceeds its fair value, an impairment loss is recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to that reporting unit. In January 2020, we adopted ASU 2017-04, in which the requirement to calculate the implied fair value of goodwill under the two-step impairment test was eliminated. To estimate the fair value of our reporting units, we use two generally accepted valuation approaches, an income approach and a market approach, using assumptions consistent with a market participant’s perspective. Under the income approach, we use anticipated cash flows over a period of years plus a terminal value and discount these amounts to their present value using appropriate discount rates. Under the market approach, we apply EBITDA multiples to forecasted EBITDA. The multiples used are consistent with historical asset transactions. The forecasted cash flows are based on average forecasted cash flows for a reporting unit over a period of years. Based on the results of our impairment test, we concluded the carrying value of the Natural Gas Gathering and Processing reporting unit exceeded its estimated fair value, resulting in a noncash impairment charge of $153.4 million for the three months ended March 31, 2020, which is included within impairment charges in our Consolidated Statement of Income. The estimated fair value of our Natural Gas Liquids and Natural Gas Pipelines reporting units substantially exceeded their respective carrying values. The following table sets forth our goodwill, by segment, for the periods indicated: March 31, December 31, ( Thousands of dollars ) Natural Gas Gathering and Processing $ — $ 153,404 Natural Gas Liquids 371,217 371,217 Natural Gas Pipelines 156,375 156,375 Total goodwill $ 527,592 $ 680,996 Long-lived assets - We assess our long-lived assets for impairment whenever events or changes in circumstances indicate that an asset’s carrying amount may not be recoverable. An impairment is indicated if the carrying amount of a long-lived asset exceeds the sum of the undiscounted future cash flows expected to result from the use and eventual disposition of the asset. If an impairment is indicated, we record an impairment loss equal to the difference between the carrying value and the fair value of the long-lived asset. We evaluated our Natural Gas Gathering and Processing segment asset groups and determined that the carrying value of certain long-lived asset groups in western Oklahoma, Kansas and the Powder River Basin, where lower pricing is expected to impact drilling and production levels, are not recoverable and exceeded their estimated fair value. We recorded noncash impairment charges of $380.5 million for the three months ended March 31, 2020, which includes impairment to intangible assets of $19.9 million related to supply contracts. In our Natural Gas Liquids segment, we recorded noncash impairment charges of $70.2 million for the three months ended March 31, 2020, related to certain inactive assets, as our expectation for future use of the assets changed. These charges are included within impairment charges in our Consolidated Statement of Income. Investments in unconsolidated affiliates - The impairment test for equity-method investments considers whether the fair value of the equity investment as a whole, not the underlying net assets, has declined and whether that decline is other than temporary. Therefore, we periodically evaluate the amount at which we carry our equity-method investments to determine whether current events or circumstances warrant adjustments to our carrying values. We evaluated our investments in unconsolidated affiliates and concluded that the carrying value of our 10.2% investment in Venice Energy Services Company in our Natural Gas Gathering and Processing segment exceeded its estimated fair value, resulting in a noncash impairment charge of $30.5 million for the three months ended March 31, 2020, which includes an impairment to our equity-method goodwill of $22.3 million . We also concluded that the carrying value of our 50% investment in Chisholm Pipeline Company in our Natural Gas Liquids segment exceeded its estimated fair value, resulting in a noncash impairment charge of $7.2 million for the three months ended March 31, 2020. These impairment charges are included within impairment of equity investments in our Consolidated Statement of Income. Recently Issued Accounting Standards Update - Changes to GAAP are established by the Financial Accounting Standards Board (FASB) in the form of ASUs to the FASB Accounting Standards Codification. We consider the applicability and impact of all ASUs. ASUs not listed below or in our Annual Report were assessed and determined to be either not applicable or clarifications of ASUs previously issued or listed below. Except as discussed below or in our Annual Report, there have been no new accounting pronouncements that have become effective or have been issued that are of significance or potential significance to us. The following table provides a brief description of recently adopted accounting pronouncements and our analysis of the effects on our financial statements: Standard Description Date of Adoption Effect on the Financial Statements or Other Significant Matters ASU 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” The standard requires a financial asset (or a group of financial assets) measured at amortized cost basis to be presented net of the allowance for credit losses to reflect the net carrying value at the amount expected to be collected on the financial asset; and the initial allowance for credit losses for purchased financial assets, including available-for-sale debt securities, to be added to the purchase price rather than being reported as a credit loss expense. First quarter 2020 The impact of adopting this standard was not material. ASU 2017-04, “Intangibles- Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment” The standard simplifies the subsequent measurement of goodwill by eliminating the requirement to calculate the implied fair value of goodwill under step 2. Instead, an entity will recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value. The standard does not change step zero or step 1 assessments. First quarter 2020 We adopted and implemented this standard to record noncash impairment charges related to our goodwill, as described above. ASU 2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting” The standard provides optional expedients and exceptions for applying U.S. GAAP to contracts, hedging relationships and other transactions affected by reference rate reform if certain criteria are met. First quarter 2020 The impact of adopting this standard was not material. |
FAIR VALUE MEASUREMENTS (Notes)
FAIR VALUE MEASUREMENTS (Notes) | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS Determining Fair Value - For our fair value measurements, we utilize market prices, third-party pricing services, present value methods and standard option valuation models to determine the price we would receive from the sale of an asset or the transfer of a liability in an orderly transaction at the measurement date. We measure the fair value of a group of financial assets and liabilities consistent with how a market participant would price the net risk exposure at the measurement date. Many of the contracts in our derivative portfolio are executed in liquid markets where price transparency exists. Our financial commodity derivatives are generally settled through a NYMEX or Intercontinental Exchange (ICE) clearing broker account with daily margin requirements. We validate our valuation inputs with third-party information and settlement prices from other sources, where available. We compute the fair value of our derivative portfolio by discounting the projected future cash flows from our derivative assets and liabilities to present value using interest-rate yields to calculate present-value discount factors derived from the implied forward LIBOR yield curve. The fair value of our forward-starting interest-rate swaps is determined using financial models that incorporate the implied forward LIBOR yield curve for the same period as the future interest-rate swap settlements. We consider current market data in evaluating counterparties’, as well as our own, nonperformance risk, net of collateral, by using counterparty-specific bond yields. Although we use our best estimates to determine the fair value of the derivative contracts we have executed, the ultimate market prices realized could differ materially from our estimates. Fair Value Hierarchy - At each balance sheet date, we utilize a fair value hierarchy to classify fair value amounts recognized or disclosed in our financial statements based on the observability of inputs used to estimate such fair value. The levels of the hierarchy are described below: • Level 1 - fair value measurements are based on unadjusted quoted prices for identical securities in active markets. These balances are composed predominantly of exchange-traded derivative contracts for natural gas and crude oil. • Level 2 - fair value measurements are based on significant observable pricing inputs, including quoted prices for similar assets and liabilities in active markets and inputs from third-party pricing services supported with corroborative evidence. These balances are composed of over-the-counter interest-rate derivatives. • Level 3 - fair value measurements are based on inputs that may include one or more unobservable inputs, including internally developed commodity price curves that incorporate market data from broker quotes and third-party pricing services. These balances are composed predominantly of exchange-cleared and over-the-counter derivatives to hedge NGL price risk and natural gas basis risk between various transaction locations and the NYMEX Henry Hub. Our commodity derivatives are generally valued using forward quotes provided by third-party pricing services that are validated with other market data. We believe any measurement uncertainty at March 31, 2020, is immaterial as our Level 3 fair value measurements are based on unadjusted pricing information from broker quotes and third-party pricing services. We do not believe that our Level 3 fair value estimates have a material impact on our results of operations, as our derivatives are accounted for as hedges. Determining the appropriate classification of our fair value measurements within the fair value hierarchy requires management’s judgment regarding the degree to which market data is observable or corroborated by observable market data. We categorize derivatives for which fair value is determined using multiple inputs within a single level, based on the lowest level input that is significant to the fair value measurement in its entirety. Recurring Fair Value Measurements - The following tables set forth our recurring fair value measurements for the periods indicated: March 31, 2020 Level 1 Level 2 Level 3 Total - Gross Netting (a) Total - Net ( Thousands of dollars ) Derivative assets Commodity contracts Financial contracts $ 37,599 $ — $ 130,272 $ 167,871 $ (140,707 ) $ 27,164 Total derivative assets $ 37,599 $ — $ 130,272 $ 167,871 $ (140,707 ) $ 27,164 Derivative liabilities Commodity contracts Financial contracts $ (911 ) $ — $ (72,871 ) $ (73,783 ) $ 73,783 $ — Interest-rate contracts — (270,297 ) — (270,297 ) — (270,297 ) Total derivative liabilities $ (911 ) $ (270,297 ) $ (72,871 ) $ (344,080 ) $ 73,783 $ (270,297 ) (a) - Derivative assets and liabilities are presented in our Consolidated Balance Sheet on a net basis. We net derivative assets and liabilities when a legally enforceable master-netting arrangement exists between the counterparty to a derivative contract and us. At March 31, 2020 , we posted no cash and held cash of $66.9 million from various counterparties, which offsets our derivative net asset position under master netting arrangements as shown in the table above. December 31, 2019 Level 1 Level 2 Level 3 Total - Gross Netting (a) Total - Net ( Thousands of dollars ) Derivative assets Commodity contracts Financial contracts $ 10,892 $ — $ 55,557 $ 66,449 $ (28,588 ) $ 37,861 Interest-rate contracts — 581 — 581 — 581 Total derivative assets $ 10,892 $ 581 $ 55,557 $ 67,030 $ (28,588 ) $ 38,442 Derivative liabilities Commodity contracts Financial contracts $ (4,811 ) $ — $ (24,785 ) $ (29,596 ) $ 28,588 $ (1,008 ) Interest-rate contracts — (201,941 ) — (201,941 ) — (201,941 ) Total derivative liabilities $ (4,811 ) $ (201,941 ) $ (24,785 ) $ (231,537 ) $ 28,588 $ (202,949 ) (a) - Derivative assets and liabilities are presented in our Consolidated Balance Sheet on a net basis. We net derivative assets and liabilities when a legally enforceable master-netting arrangement exists between the counterparty to a derivative contract and us. At December 31, 2019 , we held no cash and posted $8.8 million of cash with various counterparties, which is included in other current assets in our Consolidated Balance Sheet. The following table sets forth a reconciliation of our Level 3 fair value measurements for the periods indicated: Three Months Ended March 31, Derivative Assets (Liabilities) 2020 2019 ( Thousands of dollars ) Net assets at beginning of period $ 30,772 $ 40,484 Total changes in fair value: Settlements included in net income (loss) (a) (16,146 ) (25,361 ) New Level 3 derivatives included in other comprehensive income (loss) (b) 20,993 1,597 Unrealized change included in other comprehensive income (loss) (b) 21,782 (5,191 ) Net assets at end of period $ 57,401 $ 11,529 (a) - Included in commodity sales revenues/cost of sales and fuel in our Consolidated Statements of Income. (b) - Included in change in fair value of derivatives in our Consolidated Statements of Comprehensive Income. During the three months ended March 31, 2020 and 2019 , there were no transfers in or out of Level 3 of the fair value hierarchy. Other Financial Instruments - The approximate fair value of cash and cash equivalents, accounts receivable, accounts payable and short-term borrowings is equal to book value due to the short-term nature of these items. Our cash and cash equivalents are composed of bank and money market accounts and are classified as Level 1. Our short-term borrowings are classified as Level 2 since the estimated fair value of the short-term borrowings can be determined using information available in the commercial paper market. The estimated fair value of our consolidated long-term debt, including current maturities, was $11.9 billion and $13.8 billion at March 31, 2020 , and December 31, 2019 , respectively. The book value of our consolidated long-term debt, including current maturities, was $ 14.2 billion and $12.5 billion at March 31, 2020 , and December 31, 2019 , respectively. The estimated fair value of the aggregate long-term debt outstanding was determined using quoted market prices for similar issues with similar terms and maturities. The estimated fair value of our consolidated long-term debt is classified as Level 2. Nonrecurring Fair Value Measurements - During the three months ended March 31, 2020, we recorded noncash impairment charges for certain long-lived assets and equity investments. The valuation of these assets and investments required the use of significant unobservable inputs. To estimate the fair value, we used two generally accepted valuation approaches, an income approach and a market approach. Under the income approach, our discounted cash flow analysis included the following inputs that are not readily available: a discount rate reflective of industry cost of capital, our estimated contract rates, volumes, operating and maintenance costs and capital expenditures. Under the market approach, our inputs included EBITDA multiples and forecasted EBITDA, which was estimated using commodity price forecasts consistent with third-party pricing services. The estimated fair value of these assets is classified as Level 3. See Note A for additional information about our impairment charges. |
RISK MANAGEMENT AND HEDGING ACT
RISK MANAGEMENT AND HEDGING ACTIVITIES USING DERIVATIVES (Notes) | 3 Months Ended |
Mar. 31, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
RISK MANAGEMENT AND HEDGING ACTIVITIES USING DERIVATIVES | RISK-MANAGEMENT AND HEDGING ACTIVITIES USING DERIVATIVES Risk-Management Activities - We are sensitive to changes in natural gas, crude oil and NGL prices, principally as a result of contractual terms under which these commodities are processed, purchased and sold. We are also subject to the risk of interest-rate fluctuation in the normal course of business. We use physical-forward purchases and sales and financial derivatives to secure a certain price for a portion of our natural gas, condensate and NGL products; to reduce our exposure to commodity price and interest-rate fluctuations; and to achieve more predictable cash flows. We follow established policies and procedures to assess risk and approve, monitor and report our risk-management activities. We have not used these instruments for trading purposes. Commodity price risk - Commodity price risk refers to the risk of loss in cash flows and future earnings arising from adverse changes in the price of natural gas, NGLs and condensate. We may use the following commodity derivative instruments to reduce the near-term commodity price risk associated with a portion of the forecasted sales of these commodities: • Futures contracts - Standardized contracts to purchase or sell natural gas and crude oil for future delivery or settlement under the provisions of exchange regulations; • Forward contracts - Nonstandardized commitments between two parties to purchase or sell natural gas, crude oil or NGLs for future physical delivery. These contracts are typically nontransferable and can only be canceled with the consent of both parties; • Swaps - Exchange of one or more payments based on the value of one or more commodities. These instruments transfer the financial risk associated with a future change in value between the counterparties of the transaction, without also conveying ownership interest in the asset or liability; and • Options - Contractual agreements that give the holder the right, but not the obligation, to buy or sell a fixed quantity of a commodity at a fixed price within a specified period of time. Options may either be standardized and exchange-traded or customized and nonexchange-traded. We may also use other instruments including collars to mitigate commodity price risk. A collar is a combination of a purchased put option and a sold call option, which places a floor and a ceiling price for commodity sales being hedged. In our Natural Gas Gathering and Processing segment, we are exposed to commodity price risk as a result of retaining a portion of the commodity sales proceeds associated with our POP with fee contracts. Under certain POP with fee contracts, our fees and POP percentage may increase or decrease if production volumes, delivery pressures or commodity prices change relative to specified thresholds. We also are exposed to basis risk between the various production and market locations where we buy and sell commodities. As part of our hedging strategy, we use the previously described commodity derivative financial instruments and physical-forward contracts to reduce the impact of price fluctuations related to natural gas, NGLs and condensate. In our Natural Gas Liquids segment, we are primarily exposed to commodity price risk resulting from the relative values of the various NGL products to each other, the value of NGLs in storage and the relative value of NGLs to natural gas. We are also exposed to location price differential risk as a result of the relative value of NGL purchases at one location and sales at another location, primarily related to our optimization and marketing activities. As part of our hedging strategy, we utilize physical-forward contracts and commodity derivative financial instruments to reduce the impact of price fluctuations related to NGLs. In our Natural Gas Pipelines segment, we are primarily exposed to commodity price risk on our intrastate pipelines because they consume natural gas in operations and retain natural gas from our customers for operations or as part of our fee for services provided. When the amount consumed in operations differs from the amount provided by our customers, our pipelines must buy or sell natural gas, or store or use natural gas from inventory, which can expose this segment to commodity price risk depending on the regulatory treatment for this activity. To the extent that commodity price risk in our Natural Gas Pipelines segment is not mitigated by fuel cost-recovery mechanisms, we may use physical-forward sales or purchases to reduce the impact of natural gas price fluctuations. At March 31, 2020 , and December 31, 2019 , there were no financial derivative instruments with respect to our natural gas pipeline operations. Interest-rate risk - We manage interest-rate risk through the use of fixed-rate debt, floating-rate debt and interest-rate swaps. Interest-rate swaps are agreements to exchange interest payments at some future point based on specified notional amounts. In March 2020, we settled $750 million of our forward-starting interest-rate swaps related to our underwritten public offerings of $1.75 billion senior unsecured notes. At March 31, 2020 , and December 31, 2019 , we had forward-starting interest-rate swaps with notional amounts totaling $1.1 billion and $1.8 billion , respectively, to hedge the variability of interest payments on a portion of our forecasted debt issuances. At March 31, 2020 , and December 31, 2019 , we had interest-rate swaps with notional amounts totaling $1.3 billion to hedge the variability of our LIBOR-based interest payments. All of our interest-rate swaps are designated as cash flow hedges. Accounting Treatment - Our accounting treatment of derivative instruments is consistent with that disclosed in Note A of the Notes to Consolidated Financial Statements in our Annual Report. Fair Values of Derivative Instruments - All derivatives measured at fair value at March 31, 2020, and December 31, 2019, were designated as hedging instruments. See Note B for a discussion of the inputs associated with our fair value measurements. The following table sets forth the fair values of our derivative instruments presented on a gross basis for the periods indicated: March 31, 2020 December 31, 2019 Location in our Consolidated Balance Sheets Assets (Liabilities) Assets (Liabilities) ( Thousands of dollars ) Commodity contracts (a) Financial contracts Other current assets $ 167,871 $ (73,783 ) $ 64,858 $ (26,997 ) Other deferred credits — — 1,591 (2,599 ) Interest-rate contracts Other current liabilities — (28,673 ) — (90,161 ) Other assets/other deferred credits — (241,624 ) 581 (111,780 ) Total derivative instruments $ 167,871 $ (344,080 ) $ 67,030 $ (231,537 ) (a) - Derivative assets and liabilities are presented in our Consolidated Balance Sheets on a net basis when a legally enforceable master-netting arrangement exists between the counterparty to a derivative contract and us. Notional Quantities for Derivative Instruments - The following table sets forth the notional quantities for derivative instruments held for the periods indicated: March 31, 2020 December 31, 2019 Contract Type Purchased/ Payor Sold/ Receiver Purchased/ Payor Sold/ Receiver Cash flow hedges Fixed price - Natural gas ( Bcf ) Futures and swaps — (47.6 ) — (59.0 ) - Crude oil and NGLs ( MMBbl ) Futures, forwards and swaps 10.5 (17.5 ) 7.9 (17.4 ) Basis - Natural gas ( Bcf ) Futures and swaps — (47.6 ) — (59.0 ) Interest-rate contracts ( Billions of dollars ) Swaps $ 2.4 $ — $ 3.1 $ — These notional amounts are used to summarize the volume of financial instruments; however, they do not reflect the extent to which the positions offset one another and, consequently, do not reflect our actual exposure to market or credit risk. Cash Flow Hedges - The following table sets forth the unrealized change in fair value of cash flow hedges in other comprehensive income (loss) for the periods indicated: Three Months Ended March 31, 2020 2019 ( Thousands of dollars ) Commodity contracts $ 87,195 $ (21,625 ) Interest-rate contracts (225,041 ) (67,912 ) Total unrealized change in fair value of cash flow hedges in other comprehensive income (loss) $ (137,846 ) $ (89,537 ) The following table sets forth the effect of cash flow hedges on net income (loss) for the periods indicated: Location of Gain (Loss) Reclassified from Accumulated Other Comprehensive Loss into Net Income (Loss) Three Months Ended March 31, 2020 2019 ( Thousands of dollars ) Commodity contracts Commodity sales revenues $ 44,999 $ 23,822 Cost of sales and fuel (15,039 ) (4,970 ) Interest-rate contracts Interest expense (10,278 ) (2,504 ) Total change in fair value of cash flow hedges reclassified from accumulated other comprehensive loss into net income (loss) on derivatives $ 19,682 $ 16,348 Credit Risk - We monitor the creditworthiness of our counterparties and compliance with policies and limits established by our Risk Oversight and Strategy Committee. We maintain credit policies with regard to our counterparties that we believe minimize overall credit risk. These policies include an evaluation of potential counterparties’ financial condition (including credit ratings, bond yields and credit default swap rates), collateral requirements under certain circumstances and the use of standardized master-netting agreements that allow us to net the positive and negative exposures associated with a single counterparty. We use internally developed credit ratings for counterparties that do not have a credit rating. Our financial commodity derivatives are generally settled through a NYMEX or Intercontinental Exchange (ICE) clearing broker account with daily margin requirements. However, we may enter into financial derivative instruments that contain provisions that require us to maintain an investment-grade credit rating from S&P and/or Moody’s. If our credit ratings on our senior unsecured long-term debt were to decline below investment grade, the counterparties to the derivative instruments could request collateralization on derivative instruments in net liability positions. There were no financial derivative instruments with contingent features related to credit risk at March 31, 2020 . The counterparties to our derivative contracts typically consist of major energy companies, financial institutions and commercial and industrial end users. This concentration of counterparties may affect our overall exposure to credit risk, either positively or negatively, in that the counterparties may be affected similarly by changes in economic, regulatory or other conditions. Based on our policies, exposures, credit and other reserves, we do not anticipate a material adverse effect on our financial position or results of operations as a result of counterparty nonperformance. At March 31, 2020 , the credit exposure from our derivative assets is with investment-grade companies in the financial services sector. |
DEBT DEBT (Notes)
DEBT DEBT (Notes) | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Debt [Text Block] | DEBT The following table sets forth our consolidated debt for the periods indicated: March 31, December 31, ( Thousands of dollars ) Commercial paper outstanding, bearing a weighted-average interest rate of 2.16% as of December 31, 2019 $ — $ 220,000 Senior unsecured obligations: $1,500,000 term loan, variable rate, due November 2021 1,250,000 1,250,000 $700,000 at 4.25% due February 2022 547,397 547,397 $900,000 at 3.375% due October 2022 900,000 900,000 $425,000 at 5.0% due September 2023 425,000 425,000 $500,000 at 7.5% due September 2023 500,000 500,000 $500,000 at 2.75% due September 2024 500,000 500,000 $500,000 at 4.9% due March 2025 500,000 500,000 $400,000 at 2.2% due September 2025 397,000 — $500,000 at 4.0% due July 2027 500,000 500,000 $800,000 at 4.55% due July 2028 800,000 800,000 $100,000 at 6.875% due September 2028 100,000 100,000 $700,000 at 4.35% due March 2029 700,000 700,000 $750,000 at 3.4% due September 2029 734,251 750,000 $850,000 at 3.1% due March 2030 821,050 — $400,000 at 6.0% due June 2035 400,000 400,000 $600,000 at 6.65% due October 2036 600,000 600,000 $600,000 at 6.85% due October 2037 600,000 600,000 $650,000 at 6.125% due February 2041 650,000 650,000 $400,000 at 6.2% due September 2043 400,000 400,000 $700,000 at 4.95% due July 2047 693,405 700,000 $1,000,000 at 5.2% due July 2048 1,000,000 1,000,000 $750,000 at 4.45% due September 2049 747,650 750,000 $500,000 at 4.5% due March 2050 489,625 — Guardian Pipeline Weighted average 7.85% due December 2022 19,395 21,307 Total debt 14,274,773 12,813,704 Unamortized portion of terminated swaps 14,603 15,032 Unamortized debt issuance costs and discounts (135,076 ) (121,329 ) Current maturities of long-term debt (7,650 ) (7,650 ) Short-term borrowings (a) — (220,000 ) Long-term debt $ 14,146,650 $ 12,479,757 (a) - Individual issuances of commercial paper under our commercial paper program generally mature in 90 days or less. $2.5 Billion Credit Agreement - Our $2.5 Billion Credit Agreement is a revolving credit facility and contains certain financial, operational and legal covenants. Among other things, these covenants include maintaining a ratio of indebtedness to adjusted EBITDA (EBITDA, as defined in our $2.5 Billion Credit Agreement, adjusted for all noncash charges and increased for projected EBITDA from certain lender-approved capital expansion projects) of no more than 5.0 to 1 at March 31, 2020. At March 31, 2020 , we had no borrowings outstanding, our ratio of indebtedness to adjusted EBITDA was 4.5 to 1, and we were in compliance with all covenants under our $2.5 Billion Credit Agreement. Debt Issuances - In early March 2020, we completed an underwritten public offering of $1.75 billion senior unsecured notes consisting of $400 million , 2.2% senior notes due 2025; $850 million , 3.1% senior notes due 2030; and $500 million , 4.5% senior notes due 2050. The net proceeds, after deducting underwriting discounts, commissions and offering expenses, were $1.73 billion . A portion of the proceeds were used to pay all outstanding amounts under our commercial paper program. The remainder was, and will be, used for general corporate purposes, which may include repayment of other existing indebtedness and funding capital expenditures. Debt Repayments - In March 2020, we repurchased in the open market $67.0 million outstanding principal of certain of our senior notes for an aggregate repurchase price of $50.5 million with cash on hand. In connection with these open market repurchases, we recognized a $15.8 million gain on extinguishment of debt, which is included in other income in our Consolidated Statement of Income for the three months ended March 31, 2020. Debt Guarantees - We, ONEOK Partners and the Intermediate Partnership have cross guarantees in place for our and ONEOK Partners’ indebtedness. For additional discussion of our $2.5 Billion Credit Agreement and our $1.5 Billion Term Loan Agreement, see Note F of the Notes to Consolidated Financial Statements in our Annual Report. |
EQUITY (Notes)
EQUITY (Notes) | 3 Months Ended |
Mar. 31, 2020 | |
Equity [Abstract] | |
EQUITY | EQUITY Dividends - Holders of our common stock share equally in any dividend declared by our Board of Directors, subject to the rights of the holders of outstanding preferred stock. Dividends paid on our common stock in February 2020 were $0.935 per share. A dividend of $0.935 per share was declared for shareholders of record at the close of business on April 27, 2020 , payable May 14, 2020 . The Series E Preferred Stock pays quarterly dividends on each share of Series E Preferred Stock, when, as and if declared by our Board of Directors, at a rate of 5.5% per year. We paid dividends for the Series E Preferred Stock of $0.3 million in February 2020. Dividends totaling $0.3 million were declared for the Series E Preferred Stock and are payable May 14, 2020 . |
ACCUMULATED OTHER COMPREHENSIVE
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Notes) | 3 Months Ended |
Mar. 31, 2020 | |
ACCUMULATED OTHER COMPREHENSIVE LOSS | ACCUMULATED OTHER COMPREHENSIVE LOSS The following table sets forth the balance in accumulated other comprehensive loss for the period indicated: Risk- Management Assets/Liabilities (a) Retirement and Other Postretirement Benefit Plan Obligations (a) (b) Risk- Management Assets/Liabilities of Unconsolidated Affiliates (a) Accumulated Other Comprehensive Loss (a) ( Thousands of dollars ) January 1, 2020 $ (233,520 ) $ (131,481 ) $ (8,999 ) $ (374,000 ) Other comprehensive income (loss) before reclassifications (106,141 ) 20 (7,777 ) (113,898 ) Amounts reclassified to net income (loss) (c) (15,164 ) 3,542 134 (11,488 ) Other comprehensive income (loss) (121,305 ) 3,562 (7,643 ) (125,386 ) March 31, 2020 $ (354,825 ) $ (127,919 ) $ (16,642 ) $ (499,386 ) (a) - All amounts are presented net of tax. (b) - Includes amounts related to supplemental executive retirement plan. (c) - See Note C for details of amounts reclassified to net income (loss) for risk-management assets/liabilities and Note H for retirement and other postretirement benefit plan obligations. The following table sets forth information about the balance of accumulated other comprehensive loss at March 31, 2020 , representing unrealized gains (losses) related to risk-management assets and liabilities: Risk- Management Assets/Liabilities (a) ( Thousands of dollars ) Commodity derivative instruments expected to be realized within the next 21 months (b) $ 72,180 Settled interest-rate swaps to be recognized over the life of the long-term, fixed-rate debt (c) (218,877 ) Interest-rate swaps with future settlement dates expected to be amortized over the life of long-term debt (208,128 ) Accumulated other comprehensive loss at March 31, 2020 $ (354,825 ) (a) - All amounts are presented net of tax. (b) - Based on March 31, 2020 , commodity prices, we expect to realize $73.0 million in net gains, net of tax, over the next 12 months and $0.8 million in net losses, net of tax, thereafter. (c) - We expect losses of $29.4 million , net of tax, will be reclassified into earnings during the next 12 months as the hedged items affect earnings. The remaining amounts in accumulated other comprehensive loss relate primarily to our retirement and other postretirement benefit plan obligations, which are expected to be amortized over the average remaining service period of employees participating in these plans. |
EARNINGS PER SHARE EARNINGS PER
EARNINGS PER SHARE EARNINGS PER SHARE (Notes) | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Earnings Per Share [Text Block] | EARNINGS PER SHARE The following tables set forth the computation of basic and diluted EPS for the periods indicated: Three Months Ended March 31, 2020 Income (Loss) Shares Per Share Amount ( Thousands, except per share amounts ) Basic EPS Net loss available for common stock $ (142,132 ) 414,282 $ (0.34 ) Diluted EPS Effect of dilutive securities — 1,066 Net loss available for common stock and common stock equivalents $ (142,132 ) 415,348 $ (0.34 ) Three Months Ended March 31, 2019 Income (Loss) Shares Per Share Amount ( Thousands, except per share amounts ) Basic EPS Net income available for common stock $ 336,933 412,908 $ 0.82 Diluted EPS Effect of dilutive securities — 2,325 Net income available for common stock and common stock equivalents $ 336,933 415,233 $ 0.81 |
EMPLOYEE BENEFIT PLANS EMPLOYEE
EMPLOYEE BENEFIT PLANS EMPLOYEE BENEFIT PLANS (Notes) | 3 Months Ended |
Mar. 31, 2020 | |
Defined Benefit Plan [Abstract] | |
EMPLOYEE BENEFIT PLANS | EMPLOYEE BENEFIT PLANS The following table sets forth the components of net periodic benefit cost for our retirement and other postretirement benefit plans for the periods indicated: Retirement Benefits Other Postretirement Benefits Three Months Ended Three Months Ended March 31, March 31, 2020 2019 2020 2019 ( Thousands of dollars ) Components of net periodic benefit cost Service cost $ 2,036 $ 1,954 $ 115 $ 117 Interest cost 4,574 5,126 442 509 Expected return on plan assets (6,232 ) (5,892 ) (722 ) (570 ) Amortization of prior service cost (credit) (a) 28 — — (57 ) Amortization of net loss (a) 4,571 3,158 1 74 Net periodic benefit cost (income) $ 4,977 $ 4,346 $ (164 ) $ 73 (a) - These components of net periodic benefit cost are recognized in accumulated other comprehensive loss and are reclassified to other income (expense) in our Consolidated Statements of Income, with related income tax benefits of $1.1 million and $0.7 million reclassified to income tax (expense) benefit for the three months ended March 31, 2020 and 2019, respectively. |
UNCONSOLIDATED AFFILIATES (Note
UNCONSOLIDATED AFFILIATES (Notes) | 3 Months Ended |
Mar. 31, 2020 | |
Equity Method Investments and Joint Ventures [Abstract] | |
UNCONSOLIDATED AFFILIATES | UNCONSOLIDATED AFFILIATES Equity in Net Earnings from Investments and Impairments - The following table sets forth our equity in net earnings (loss) from investments for the periods indicated: Three Months Ended March 31, 2020 2019 ( Thousands of dollars ) Northern Border Pipeline $ 22,120 $ 20,802 Overland Pass Pipeline 14,111 17,394 Roadrunner 6,433 6,338 Other 1,963 (1,053 ) Equity in net earnings from investments $ 44,627 $ 43,481 Impairment of equity investments $ (37,730 ) $ — For the three months ended March 31, 2020, we recorded a noncash impairment charge of $30.5 million related to our 10.2% investment in Venice Energy Services Company in our Natural Gas Gathering and Processing segment, which includes $22.3 million related to equity-method goodwill, and a $7.2 million noncash impairment charge related to our 50% investment in Chisholm Pipeline Company in our Natural Gas Liquids segment. Our remaining equity-method goodwill was $16.5 million at March 31, 2020. For additional information on our impairment charges, see Note A. We incurred expenses in transactions with unconsolidated affiliates of $45.3 million and $41.8 million for the three months ended March 31, 2020 and 2019 , respectively, primarily related to Overland Pass Pipeline and Northern Border Pipeline. Accounts payable to our equity-method investees at March 31, 2020 , and December 31, 2019 , were $14.7 million and $13.5 million , respectively. We have an operating agreement with Roadrunner that provides for reimbursement or payment to us for management services and certain operating costs. Reimbursements and payments from Roadrunner included in operating income (loss) in our Consolidated Statements of Income for the three months ended March 31, 2020 and 2019 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Notes) | 3 Months Ended |
Mar. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Environmental Matters and Pipeline Safety - The operation of pipelines, plants and other facilities for the gathering, processing, fractionation, transportation and storage of natural gas, NGLs, condensate and other products is subject to numerous and complex laws and regulations pertaining to health, safety and the environment. As an owner and/or operator of these facilities, we must comply with laws and regulations that relate to air and water quality, hazardous and solid waste management and disposal, cultural resource protection and other environmental matters. The cost of planning, designing, constructing and operating pipelines, plants and other facilities must incorporate compliance with these laws, regulations and safety standards. Failure to comply with these laws and regulations may trigger a variety of administrative, civil and potentially criminal enforcement measures, including citizen suits, which can include the assessment of monetary penalties, the imposition of remedial requirements and the issuance of injunctions or restrictions on operation or construction. Management believes that, based on currently known information, compliance with these laws and regulations will not affect adversely our consolidated results of operations, financial condition or cash flows. Legal Proceedings - We are a party to various litigation matters and claims that have arisen in the normal course of our operations. While the results of these litigation matters and claims cannot be predicted with certainty, we believe the reasonably possible losses from such matters, individually and in the aggregate, are not material. Additionally, we believe the probable final outcome of such matters will not have a material adverse effect on our consolidated results of operations, financial position or cash flows. |
LEASES (Notes)
LEASES (Notes) | 3 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Leases of Lessee Disclosure [Text Block] | LEASES In December 2019, we entered into an operating lease for pipeline capacity with a lease term of 10 years that commenced January 1, 2020. In connection with this lease, we recognized an operating lease right-of-use asset and a lease liability with remaining balances of $ 74.0 million and $ 74.2 million , respectively, as of March 31, 2020. During the three months ended March 31, 2020, we entered into certain operating leases and recognized operating lease right-of-use assets and lease liabilities with remaining balances of $17.2 million at the end of the period. At March 31, 2020, the weighted-average remaining lease term and the weighted-average discount rate for our operating leases were 8.8 years and 3.15% , respectively. The following table sets forth information about our supplemental cash flows related to our leases: Three Months Ended March 31, 2020 2019 ( Thousands of dollars ) Cash paid for amounts included in the measurement of lease liabilities Operating cash flows for operating leases $ 2,840 $ 1,519 Financing cash flows for finance lease $ 469 $ 425 Right-of-use assets obtained in exchange for operating lease liabilities (noncash) $ 97,339 $ 380 The following table sets forth the maturity of our lease liabilities as of March 31, 2020 : Finance Lease Operating Leases ( Millions of dollars ) Remainder of 2020 $ 3.4 $ 12.4 2021 4.5 16.3 2022 4.5 14.9 2023 4.5 13.7 2024 4.5 12.4 2025 and beyond 17.1 57.0 Total lease payments 38.5 126.7 Less: Interest 12.7 16.8 Present value of lease liabilities $ 25.8 $ 109.9 |
REVENUE REVENUE (Notes)
REVENUE REVENUE (Notes) | 3 Months Ended |
Mar. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from Contract with Customer [Text Block] | REVENUES Accounting Policies - Our revenue recognition policy is described in Note A of the Notes to Consolidated Financial Statements in our Annual Report. Contract Assets and Contract Liabilities - Our contract asset balances at the beginning and end of the period primarily relate to our firm service transportation contracts with tiered rates, which are not material. The following table sets forth the balances in contract liabilities for the periods indicated: Contract Liabilities ( Millions of dollars ) Balance at December 31, 2019 (a) $ 57.1 Revenue recognized included in beginning balance (18.2 ) Net additions 6.8 Balance at March 31, 2020 (b) $ 45.7 (a) - Contract liabilities of $ 22.2 million and $ 34.9 million are included in other current liabilities and other deferred credits, respectively, in our Consolidated Balance Sheet. (b) - Contract liabilities of $ 11.9 million and $ 33.8 million are included in other current liabilities and other deferred credits, respectively, in our Consolidated Balance Sheet. Receivables from Customers and Revenue Disaggregation - Substantially all of the balances in accounts receivable on our Consolidated Balance Sheets at March 31, 2020 , and December 31, 2019 , relate to customer receivables. Revenues sources are disaggregated in Note M. Transaction Price Allocated to Unsatisfied Performance Obligations - We do not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less and (ii) variable consideration on contracts for which we recognize revenue at the amount to which we have the right to invoice for services performed. The following table presents aggregate value allocated to unsatisfied performance obligations as of March 31, 2020 , and the amounts we expect to recognize in revenue in future periods, related primarily to firm transportation and storage contracts with remaining contract terms ranging from one month to 24 years : Expected Period of Recognition in Revenue ( Millions of dollars ) Remainder of 2020 $ 257.2 2021 305.3 2022 230.9 2023 184.6 2024 and beyond 853.9 Total estimated transaction price allocated to unsatisfied performance obligations $ 1,831.9 The table above excludes variable consideration allocated entirely to wholly unsatisfied performance obligations, wholly unsatisfied promises to transfer distinct goods or services that are part of a single performance obligation and consideration we determine to be fully constrained. The amounts we determined to be fully constrained relate to future sales obligations under long-term sales contracts where the transaction price is not known and minimum volume agreements, which we consider to be fully constrained until invoiced. |
SEGMENTS (Notes)
SEGMENTS (Notes) | 3 Months Ended |
Mar. 31, 2020 | |
Segment Reporting, Disclosure of Entity's Reportable Segments [Abstract] | |
SEGMENTS | SEGMENTS Segment Descriptions - Our operations are divided into three reportable business segments, as follows: • our Natural Gas Gathering and Processing segment gathers, treats and processes natural gas; • our Natural Gas Liquids segment gathers, treats, fractionates and transports NGLs and stores, markets and distributes NGL products; and • our Natural Gas Pipelines segment operates regulated interstate and intrastate natural gas transmission pipelines and natural gas storage facilities. Other and eliminations consist of corporate costs, the operating and leasing activities of our headquarters building and related parking facility and eliminations necessary to reconcile our reportable segments to our Consolidated Financial Statements. Accounting Policies - The accounting policies of the segments are described in Note A of the Notes to Consolidated Financial Statements in our Annual Report. Operating Segment Information - The following tables set forth certain selected financial information for our operating segments for the periods indicated: Three Months Ended Natural Gas Natural Gas Natural Gas Total Segments ( Thousands of dollars ) NGL and condensate sales $ 219,917 $ 1,596,711 $ — $ 1,816,628 Residue natural gas sales 189,051 — 2,035 191,086 Gathering, processing and exchange services revenue 37,937 120,536 — 158,473 Transportation and storage revenue — 50,755 118,364 169,119 Other 3,075 2,590 384 6,049 Total revenues (c) 449,980 1,770,592 120,783 2,341,355 Cost of sales and fuel (exclusive of depreciation and operating costs) (202,170 ) (1,278,754 ) (1,539 ) (1,482,463 ) Operating costs (84,470 ) (89,571 ) (33,307 ) (207,348 ) Equity in net earnings from investments 806 15,268 28,553 44,627 Noncash compensation expense and other (4,498 ) (6,619 ) (1,966 ) (13,083 ) Segment adjusted EBITDA $ 159,648 $ 410,916 $ 112,524 $ 683,088 Depreciation and amortization $ (58,756 ) $ (57,841 ) $ (14,769 ) $ (131,366 ) Impairment charges $ (564,353 ) $ (77,401 ) $ — $ (641,754 ) Investments in unconsolidated affiliates $ 4,276 $ 435,024 $ 371,179 $ 810,479 Total assets $ 6,374,552 $ 12,682,807 $ 2,089,362 $ 21,146,721 Capital expenditures $ 181,610 $ 746,183 $ 16,590 $ 944,383 (a) - Our Natural Gas Liquids segment has regulated and nonregulated operations. Our Natural Gas Liquids segment’s regulated operations had revenues of $435.1 million , of which $378.2 million related to revenues within the segment, and cost of sales and fuel of $120.4 million . (b) - Our Natural Gas Pipelines segment has regulated and nonregulated operations. Our Natural Gas Pipelines segment’s regulated operations had revenues of $73.9 million and cost of sales and fuel of $6.1 million . (c) - Intersegment revenues for the Natural Gas Gathering and Processing segment totaled $213.3 million . Intersegment revenues for the Natural Gas Liquids and Natural Gas Pipelines segments were not material. Three Months Ended Total Segments Other and Eliminations Total ( Thousands of dollars ) Reconciliations of total segments to consolidated NGL and condensate sales $ 1,816,628 $ (199,472 ) $ 1,617,156 Residue natural gas sales 191,086 (1,032 ) 190,054 Gathering, processing and exchange services revenue 158,473 — 158,473 Transportation and storage revenue 169,119 (3,809 ) 165,310 Other 6,049 (370 ) 5,679 Total revenues (a) $ 2,341,355 $ (204,683 ) $ 2,136,672 Cost of sales and fuel (exclusive of depreciation and operating costs) $ (1,482,463 ) $ 205,535 $ (1,276,928 ) Operating costs $ (207,348 ) $ 308 $ (207,040 ) Depreciation and amortization $ (131,366 ) $ (987 ) $ (132,353 ) Impairment charges $ (641,754 ) $ — $ (641,754 ) Equity in net earnings from investments $ 44,627 $ — $ 44,627 Investments in unconsolidated affiliates $ 810,479 $ — $ 810,479 Total assets $ 21,146,721 $ 822,719 $ 21,969,440 Capital expenditures $ 944,383 $ 5,296 $ 949,679 (a) - Noncustomer revenue for the three months ended March 31, 2020 , totaled $80.2 million related primarily to gains from derivatives on commodity contracts. Three Months Ended Natural Gas Gathering and Processing Natural Gas Liquids (a) Natural Gas Pipelines (b) Total Segments ( Thousands of dollars ) NGL and condensate sales $ 332,332 $ 2,158,103 $ — $ 2,490,435 Residue natural gas sales 319,036 — 970 320,006 Gathering, processing and exchange services revenue 39,742 98,534 — 138,276 Transportation and storage revenue — 52,322 112,865 165,187 Other 3,551 2,541 2,565 8,657 Total revenues (c) 694,661 2,311,500 116,400 3,122,561 Cost of sales and fuel (exclusive of depreciation and operating costs) (450,913 ) (1,846,673 ) (1,755 ) (2,299,341 ) Operating costs (94,247 ) (110,438 ) (36,268 ) (240,953 ) Equity in net earnings (loss) from investments (1,202 ) 17,544 27,139 43,481 Noncash compensation expense and other 3,945 5,706 1,132 10,783 Segment adjusted EBITDA $ 152,244 $ 377,639 $ 106,648 $ 636,531 Depreciation and amortization $ (52,681 ) $ (46,401 ) $ (14,156 ) $ (113,238 ) Investments in unconsolidated affiliates $ 39,749 $ 447,272 $ 463,903 $ 950,924 Total assets $ 6,208,883 $ 10,220,412 $ 2,138,759 $ 18,568,054 Capital expenditures $ 215,148 $ 639,338 $ 28,688 $ 883,174 (a) - Our Natural Gas Liquids segment has regulated and nonregulated operations. Our Natural Gas Liquids segment’s regulated operations had revenues of $323.1 million , of which $270.0 million related to sales within the segment, and cost of sales and fuel of $118.5 million . (b) - Our Natural Gas Pipelines segment has regulated and nonregulated operations. Our Natural Gas Pipelines segment’s regulated operations had revenues of $70.1 million and cost of sales and fuel of $5.6 million . (c) - Intersegment revenues for the Natural Gas Gathering and Processing segment totaled $335.8 million . Intersegment revenues for the Natural Gas Liquids and Natural Gas Pipelines segments were not material. Three Months Ended Total Segments Other and Eliminations Total ( Thousands of dollars ) Reconciliations of total segments to consolidated NGL and condensate sales $ 2,490,435 $ (338,351 ) $ 2,152,084 Residue natural gas sales 320,006 — 320,006 Gathering, processing and exchange services revenue 138,276 — 138,276 Transportation and storage revenue 165,187 (3,937 ) 161,250 Other 8,657 (315 ) 8,342 Total revenues (a) $ 3,122,561 $ (342,603 ) $ 2,779,958 Cost of sales and fuel (exclusive of depreciation and operating costs) $ (2,299,341 ) $ 342,964 $ (1,956,377 ) Operating costs $ (240,953 ) $ 212 $ (240,741 ) Depreciation and amortization $ (113,238 ) $ (920 ) $ (114,158 ) Equity in net earnings from investments $ 43,481 $ — $ 43,481 Investments in unconsolidated affiliates $ 950,924 $ — $ 950,924 Total assets $ 18,568,054 $ 366,271 $ 18,934,325 Capital expenditures $ 883,174 $ 6,531 $ 889,705 (a) - Noncustomer revenue for the three months ended March 31, 2019 , totaled $22.3 million related primarily to gains from derivatives on commodity contracts. Three Months Ended March 31, 2020 2019 ( Thousands of dollars ) Reconciliation of net income (loss) to total segment adjusted EBITDA Net income (loss) $ (141,857 ) $ 337,208 Add: Interest expense, net of capitalized interest 140,616 115,420 Depreciation and amortization 132,353 114,158 Income tax expense (benefit) (55,395 ) 77,934 Impairment charges 641,754 — Noncash compensation expense (1,302 ) 5,540 Other corporate costs and noncash items (a) (33,081 ) (13,729 ) Total segment adjusted EBITDA $ 683,088 $ 636,531 (a) - The three months ended March 31, 2020, includes a corporate $15.8 million gain on extinguishment of debt related to open market repurchases. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
Impairment or Disposal of Long-Lived Assets, Including Intangible Assets, Policy [Policy Text Block] | Impairment Charges - Late in the first quarter 2020, we experienced a significant decline in our share price and market capitalization as the energy industry experienced historic events that led to a simultaneous demand and supply shock. The World Health Organization declared the novel strain of COVID-19 a global pandemic and recommended containment and mitigation measures worldwide, which contributed to a massive economic slowdown and decreased demand for crude oil. In addition, Saudi Arabia and Russia increased production of crude oil as the two countries competed for market share. As a result, the global supply of crude oil significantly exceeded demand and led to a collapse in crude oil prices. Despite recently announced production cuts from many oil producing countries, supply exceeds demand, crude oil storage is near capacity and prices remain volatile. The collapse in crude oil prices and demand for energy commodities have also contributed to lower NGL product prices and lower natural gas prices, which is creating challenges for crude oil and natural gas producers as they assess their future drilling and production plans. Based on these events, we performed a Step 1 analysis to test our goodwill for impairment and evaluated certain long-lived asset groups and equity investments for impairment. Goodwill - We assess our goodwill for impairment at least annually on July 1, unless events or changes in circumstances indicate an impairment may have occurred before that time. In the Step 1 analysis, an assessment is made by comparing the fair value of a reporting unit with its carrying amount, including goodwill. If the carrying value of a reporting unit exceeds its fair value, an impairment loss is recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to that reporting unit. In January 2020, we adopted ASU 2017-04, in which the requirement to calculate the implied fair value of goodwill under the two-step impairment test was eliminated. To estimate the fair value of our reporting units, we use two generally accepted valuation approaches, an income approach and a market approach, using assumptions consistent with a market participant’s perspective. Under the income approach, we use anticipated cash flows over a period of years plus a terminal value and discount these amounts to their present value using appropriate discount rates. Under the market approach, we apply EBITDA multiples to forecasted EBITDA. The multiples used are consistent with historical asset transactions. The forecasted cash flows are based on average forecasted cash flows for a reporting unit over a period of years. Based on the results of our impairment test, we concluded the carrying value of the Natural Gas Gathering and Processing reporting unit exceeded its estimated fair value, resulting in a noncash impairment charge of $153.4 million for the three months ended March 31, 2020, which is included within impairment charges in our Consolidated Statement of Income. The estimated fair value of our Natural Gas Liquids and Natural Gas Pipelines reporting units substantially exceeded their respective carrying values. The following table sets forth our goodwill, by segment, for the periods indicated: March 31, December 31, ( Thousands of dollars ) Natural Gas Gathering and Processing $ — $ 153,404 Natural Gas Liquids 371,217 371,217 Natural Gas Pipelines 156,375 156,375 Total goodwill $ 527,592 $ 680,996 Long-lived assets - We assess our long-lived assets for impairment whenever events or changes in circumstances indicate that an asset’s carrying amount may not be recoverable. An impairment is indicated if the carrying amount of a long-lived asset exceeds the sum of the undiscounted future cash flows expected to result from the use and eventual disposition of the asset. If an impairment is indicated, we record an impairment loss equal to the difference between the carrying value and the fair value of the long-lived asset. We evaluated our Natural Gas Gathering and Processing segment asset groups and determined that the carrying value of certain long-lived asset groups in western Oklahoma, Kansas and the Powder River Basin, where lower pricing is expected to impact drilling and production levels, are not recoverable and exceeded their estimated fair value. We recorded noncash impairment charges of $380.5 million for the three months ended March 31, 2020, which includes impairment to intangible assets of $19.9 million related to supply contracts. In our Natural Gas Liquids segment, we recorded noncash impairment charges of $70.2 million for the three months ended March 31, 2020, related to certain inactive assets, as our expectation for future use of the assets changed. These charges are included within impairment charges in our Consolidated Statement of Income. Investments in unconsolidated affiliates - The impairment test for equity-method investments considers whether the fair value of the equity investment as a whole, not the underlying net assets, has declined and whether that decline is other than temporary. Therefore, we periodically evaluate the amount at which we carry our equity-method investments to determine whether current events or circumstances warrant adjustments to our carrying values. We evaluated our investments in unconsolidated affiliates and concluded that the carrying value of our 10.2% investment in Venice Energy Services Company in our Natural Gas Gathering and Processing segment exceeded its estimated fair value, resulting in a noncash impairment charge of $30.5 million for the three months ended March 31, 2020, which includes an impairment to our equity-method goodwill of $22.3 million . We also concluded that the carrying value of our 50% investment in Chisholm Pipeline Company in our Natural Gas Liquids segment exceeded its estimated fair value, resulting in a noncash impairment charge of $7.2 million for the three months ended March 31, 2020. These impairment charges are included within impairment of equity investments in our Consolidated Statement of Income. |
Basis of Accounting, Policy [Policy Text Block] | Our accompanying unaudited Consolidated Financial Statements have been prepared pursuant to the rules and regulations of the SEC. These statements have been prepared in accordance with GAAP and reflect all adjustments that, in our opinion, are necessary for a fair statement of the results for the interim periods presented. All such adjustments are of a normal recurring nature. The 2019 year-end Consolidated Balance Sheet data was derived from our audited Consolidated Financial Statements but does not include all disclosures required by GAAP. Certain reclassifications have been made in the prior-year Consolidated Financial Statements to conform to the current year presentation. These unaudited Consolidated Financial Statements should be read in conjunction with our audited Consolidated Financial Statements in our Annual Report. |
New Accounting Pronouncements, Policy [Policy Text Block] | Recently Issued Accounting Standards Update - Changes to GAAP are established by the Financial Accounting Standards Board (FASB) in the form of ASUs to the FASB Accounting Standards Codification. We consider the applicability and impact of all ASUs. ASUs not listed below or in our Annual Report were assessed and determined to be either not applicable or clarifications of ASUs previously issued or listed below. Except as discussed below or in our Annual Report, there have been no new accounting pronouncements that have become effective or have been issued that are of significance or potential significance to us. The following table provides a brief description of recently adopted accounting pronouncements and our analysis of the effects on our financial statements: Standard Description Date of Adoption Effect on the Financial Statements or Other Significant Matters ASU 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” The standard requires a financial asset (or a group of financial assets) measured at amortized cost basis to be presented net of the allowance for credit losses to reflect the net carrying value at the amount expected to be collected on the financial asset; and the initial allowance for credit losses for purchased financial assets, including available-for-sale debt securities, to be added to the purchase price rather than being reported as a credit loss expense. First quarter 2020 The impact of adopting this standard was not material. ASU 2017-04, “Intangibles- Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment” The standard simplifies the subsequent measurement of goodwill by eliminating the requirement to calculate the implied fair value of goodwill under step 2. Instead, an entity will recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value. The standard does not change step zero or step 1 assessments. First quarter 2020 We adopted and implemented this standard to record noncash impairment charges related to our goodwill, as described above. ASU 2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting” The standard provides optional expedients and exceptions for applying U.S. GAAP to contracts, hedging relationships and other transactions affected by reference rate reform if certain criteria are met. First quarter 2020 The impact of adopting this standard was not material. |
FAIR VALUE MEASUREMENTS FAIR VA
FAIR VALUE MEASUREMENTS FAIR VALUE MEASUREMENTS (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Accounting Policy [Abstract] | |
Fair Value of Financial Instruments, Policy [Policy Text Block] | Determining Fair Value - For our fair value measurements, we utilize market prices, third-party pricing services, present value methods and standard option valuation models to determine the price we would receive from the sale of an asset or the transfer of a liability in an orderly transaction at the measurement date. We measure the fair value of a group of financial assets and liabilities consistent with how a market participant would price the net risk exposure at the measurement date. Many of the contracts in our derivative portfolio are executed in liquid markets where price transparency exists. Our financial commodity derivatives are generally settled through a NYMEX or Intercontinental Exchange (ICE) clearing broker account with daily margin requirements. We validate our valuation inputs with third-party information and settlement prices from other sources, where available. We compute the fair value of our derivative portfolio by discounting the projected future cash flows from our derivative assets and liabilities to present value using interest-rate yields to calculate present-value discount factors derived from the implied forward LIBOR yield curve. The fair value of our forward-starting interest-rate swaps is determined using financial models that incorporate the implied forward LIBOR yield curve for the same period as the future interest-rate swap settlements. We consider current market data in evaluating counterparties’, as well as our own, nonperformance risk, net of collateral, by using counterparty-specific bond yields. Although we use our best estimates to determine the fair value of the derivative contracts we have executed, the ultimate market prices realized could differ materially from our estimates. Fair Value Hierarchy - At each balance sheet date, we utilize a fair value hierarchy to classify fair value amounts recognized or disclosed in our financial statements based on the observability of inputs used to estimate such fair value. The levels of the hierarchy are described below: • Level 1 - fair value measurements are based on unadjusted quoted prices for identical securities in active markets. These balances are composed predominantly of exchange-traded derivative contracts for natural gas and crude oil. • Level 2 - fair value measurements are based on significant observable pricing inputs, including quoted prices for similar assets and liabilities in active markets and inputs from third-party pricing services supported with corroborative evidence. These balances are composed of over-the-counter interest-rate derivatives. • Level 3 - fair value measurements are based on inputs that may include one or more unobservable inputs, including internally developed commodity price curves that incorporate market data from broker quotes and third-party pricing services. These balances are composed predominantly of exchange-cleared and over-the-counter derivatives to hedge NGL price risk and natural gas basis risk between various transaction locations and the NYMEX Henry Hub. Our commodity derivatives are generally valued using forward quotes provided by third-party pricing services that are validated with other market data. We believe any measurement uncertainty at March 31, 2020, is immaterial as our Level 3 fair value measurements are based on unadjusted pricing information from broker quotes and third-party pricing services. We do not believe that our Level 3 fair value estimates have a material impact on our results of operations, as our derivatives are accounted for as hedges. Determining the appropriate classification of our fair value measurements within the fair value hierarchy requires management’s judgment regarding the degree to which market data is observable or corroborated by observable market data. We categorize derivatives for which fair value is determined using multiple inputs within a single level, based on the lowest level input that is significant to the fair value measurement in its entirety. |
REVENUE REVENUE (Policies)
REVENUE REVENUE (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from Contract with Customer [Policy Text Block] | Accounting Policies |
SEGMENTS SEGMENTS (Policies)
SEGMENTS SEGMENTS (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Segment Accounting Policy [Policy Text Block] | Accounting Policies - The accounting policies of the segments are described in Note A of the Notes to Consolidated Financial Statements in our Annual Report. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill by Segment | The following table sets forth our goodwill, by segment, for the periods indicated: March 31, December 31, ( Thousands of dollars ) Natural Gas Gathering and Processing $ — $ 153,404 Natural Gas Liquids 371,217 371,217 Natural Gas Pipelines 156,375 156,375 Total goodwill $ 527,592 $ 680,996 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Recurring Fair Value Measurements | The following tables set forth our recurring fair value measurements for the periods indicated: March 31, 2020 Level 1 Level 2 Level 3 Total - Gross Netting (a) Total - Net ( Thousands of dollars ) Derivative assets Commodity contracts Financial contracts $ 37,599 $ — $ 130,272 $ 167,871 $ (140,707 ) $ 27,164 Total derivative assets $ 37,599 $ — $ 130,272 $ 167,871 $ (140,707 ) $ 27,164 Derivative liabilities Commodity contracts Financial contracts $ (911 ) $ — $ (72,871 ) $ (73,783 ) $ 73,783 $ — Interest-rate contracts — (270,297 ) — (270,297 ) — (270,297 ) Total derivative liabilities $ (911 ) $ (270,297 ) $ (72,871 ) $ (344,080 ) $ 73,783 $ (270,297 ) (a) - Derivative assets and liabilities are presented in our Consolidated Balance Sheet on a net basis. We net derivative assets and liabilities when a legally enforceable master-netting arrangement exists between the counterparty to a derivative contract and us. At March 31, 2020 , we posted no cash and held cash of $66.9 million from various counterparties, which offsets our derivative net asset position under master netting arrangements as shown in the table above. December 31, 2019 Level 1 Level 2 Level 3 Total - Gross Netting (a) Total - Net ( Thousands of dollars ) Derivative assets Commodity contracts Financial contracts $ 10,892 $ — $ 55,557 $ 66,449 $ (28,588 ) $ 37,861 Interest-rate contracts — 581 — 581 — 581 Total derivative assets $ 10,892 $ 581 $ 55,557 $ 67,030 $ (28,588 ) $ 38,442 Derivative liabilities Commodity contracts Financial contracts $ (4,811 ) $ — $ (24,785 ) $ (29,596 ) $ 28,588 $ (1,008 ) Interest-rate contracts — (201,941 ) — (201,941 ) — (201,941 ) Total derivative liabilities $ (4,811 ) $ (201,941 ) $ (24,785 ) $ (231,537 ) $ 28,588 $ (202,949 ) (a) - Derivative assets and liabilities are presented in our Consolidated Balance Sheet on a net basis. We net derivative assets and liabilities when a legally enforceable master-netting arrangement exists between the counterparty to a derivative contract and us. At December 31, 2019 , we held no cash and posted $8.8 million of cash with various counterparties, which is included in other current assets in our Consolidated Balance Sheet. |
Reconciliation of Level 3 Fair Value Measurements | The following table sets forth a reconciliation of our Level 3 fair value measurements for the periods indicated: Three Months Ended March 31, Derivative Assets (Liabilities) 2020 2019 ( Thousands of dollars ) Net assets at beginning of period $ 30,772 $ 40,484 Total changes in fair value: Settlements included in net income (loss) (a) (16,146 ) (25,361 ) New Level 3 derivatives included in other comprehensive income (loss) (b) 20,993 1,597 Unrealized change included in other comprehensive income (loss) (b) 21,782 (5,191 ) Net assets at end of period $ 57,401 $ 11,529 (a) - Included in commodity sales revenues/cost of sales and fuel in our Consolidated Statements of Income. |
RISK MANAGEMENT AND HEDGING A_2
RISK MANAGEMENT AND HEDGING ACTIVITIES USING DERIVATIVES (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Fair Value of Derivatives | The following table sets forth the fair values of our derivative instruments presented on a gross basis for the periods indicated: March 31, 2020 December 31, 2019 Location in our Consolidated Balance Sheets Assets (Liabilities) Assets (Liabilities) ( Thousands of dollars ) Commodity contracts (a) Financial contracts Other current assets $ 167,871 $ (73,783 ) $ 64,858 $ (26,997 ) Other deferred credits — — 1,591 (2,599 ) Interest-rate contracts Other current liabilities — (28,673 ) — (90,161 ) Other assets/other deferred credits — (241,624 ) 581 (111,780 ) Total derivative instruments $ 167,871 $ (344,080 ) $ 67,030 $ (231,537 ) (a) - Derivative assets and liabilities are presented in our Consolidated Balance Sheets on a net basis when a legally enforceable master-netting arrangement exists between the counterparty to a derivative contract and us. |
Notional Amounts of Derivative Instruments | The following table sets forth the notional quantities for derivative instruments held for the periods indicated: March 31, 2020 December 31, 2019 Contract Type Purchased/ Payor Sold/ Receiver Purchased/ Payor Sold/ Receiver Cash flow hedges Fixed price - Natural gas ( Bcf ) Futures and swaps — (47.6 ) — (59.0 ) - Crude oil and NGLs ( MMBbl ) Futures, forwards and swaps 10.5 (17.5 ) 7.9 (17.4 ) Basis - Natural gas ( Bcf ) Futures and swaps — (47.6 ) — (59.0 ) Interest-rate contracts ( Billions of dollars ) Swaps $ 2.4 $ — $ 3.1 $ — |
Schedule of Cash Flow Hedging Instruments Effect on Comprehensive Income (Loss) | The following table sets forth the unrealized change in fair value of cash flow hedges in other comprehensive income (loss) for the periods indicated: Three Months Ended March 31, 2020 2019 ( Thousands of dollars ) Commodity contracts $ 87,195 $ (21,625 ) Interest-rate contracts (225,041 ) (67,912 ) Total unrealized change in fair value of cash flow hedges in other comprehensive income (loss) $ (137,846 ) $ (89,537 ) |
Schedule of Cash Flow Hedging Instruments Effect on Income (Loss) | The following table sets forth the effect of cash flow hedges on net income (loss) for the periods indicated: Location of Gain (Loss) Reclassified from Accumulated Other Comprehensive Loss into Net Income (Loss) Three Months Ended March 31, 2020 2019 ( Thousands of dollars ) Commodity contracts Commodity sales revenues $ 44,999 $ 23,822 Cost of sales and fuel (15,039 ) (4,970 ) Interest-rate contracts Interest expense (10,278 ) (2,504 ) Total change in fair value of cash flow hedges reclassified from accumulated other comprehensive loss into net income (loss) on derivatives $ 19,682 $ 16,348 |
DEBT DEBT (Tables)
DEBT DEBT (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Debt Instrument [Line Items] | |
Debt [Table Text Block] | The following table sets forth our consolidated debt for the periods indicated: March 31, December 31, ( Thousands of dollars ) Commercial paper outstanding, bearing a weighted-average interest rate of 2.16% as of December 31, 2019 $ — $ 220,000 Senior unsecured obligations: $1,500,000 term loan, variable rate, due November 2021 1,250,000 1,250,000 $700,000 at 4.25% due February 2022 547,397 547,397 $900,000 at 3.375% due October 2022 900,000 900,000 $425,000 at 5.0% due September 2023 425,000 425,000 $500,000 at 7.5% due September 2023 500,000 500,000 $500,000 at 2.75% due September 2024 500,000 500,000 $500,000 at 4.9% due March 2025 500,000 500,000 $400,000 at 2.2% due September 2025 397,000 — $500,000 at 4.0% due July 2027 500,000 500,000 $800,000 at 4.55% due July 2028 800,000 800,000 $100,000 at 6.875% due September 2028 100,000 100,000 $700,000 at 4.35% due March 2029 700,000 700,000 $750,000 at 3.4% due September 2029 734,251 750,000 $850,000 at 3.1% due March 2030 821,050 — $400,000 at 6.0% due June 2035 400,000 400,000 $600,000 at 6.65% due October 2036 600,000 600,000 $600,000 at 6.85% due October 2037 600,000 600,000 $650,000 at 6.125% due February 2041 650,000 650,000 $400,000 at 6.2% due September 2043 400,000 400,000 $700,000 at 4.95% due July 2047 693,405 700,000 $1,000,000 at 5.2% due July 2048 1,000,000 1,000,000 $750,000 at 4.45% due September 2049 747,650 750,000 $500,000 at 4.5% due March 2050 489,625 — Guardian Pipeline Weighted average 7.85% due December 2022 19,395 21,307 Total debt 14,274,773 12,813,704 Unamortized portion of terminated swaps 14,603 15,032 Unamortized debt issuance costs and discounts (135,076 ) (121,329 ) Current maturities of long-term debt (7,650 ) (7,650 ) Short-term borrowings (a) — (220,000 ) Long-term debt $ 14,146,650 $ 12,479,757 (a) - Individual issuances of commercial paper under our commercial paper program generally mature in 90 days or less. |
ACCUMULATED OTHER COMPREHENSI_2
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Accumulated Other Comprehensive Loss | The following table sets forth the balance in accumulated other comprehensive loss for the period indicated: Risk- Management Assets/Liabilities (a) Retirement and Other Postretirement Benefit Plan Obligations (a) (b) Risk- Management Assets/Liabilities of Unconsolidated Affiliates (a) Accumulated Other Comprehensive Loss (a) ( Thousands of dollars ) January 1, 2020 $ (233,520 ) $ (131,481 ) $ (8,999 ) $ (374,000 ) Other comprehensive income (loss) before reclassifications (106,141 ) 20 (7,777 ) (113,898 ) Amounts reclassified to net income (loss) (c) (15,164 ) 3,542 134 (11,488 ) Other comprehensive income (loss) (121,305 ) 3,562 (7,643 ) (125,386 ) March 31, 2020 $ (354,825 ) $ (127,919 ) $ (16,642 ) $ (499,386 ) (a) - All amounts are presented net of tax. (b) - Includes amounts related to supplemental executive retirement plan. (c) - See Note C for details of amounts reclassified to net income (loss) for risk-management assets/liabilities and Note H for retirement and other postretirement benefit plan obligations. |
Schedule of Accumulated Other Comprehensive Loss for Risk-Management Assets/Liabilities [Table Text Block] | The following table sets forth information about the balance of accumulated other comprehensive loss at March 31, 2020 , representing unrealized gains (losses) related to risk-management assets and liabilities: Risk- Management Assets/Liabilities (a) ( Thousands of dollars ) Commodity derivative instruments expected to be realized within the next 21 months (b) $ 72,180 Settled interest-rate swaps to be recognized over the life of the long-term, fixed-rate debt (c) (218,877 ) Interest-rate swaps with future settlement dates expected to be amortized over the life of long-term debt (208,128 ) Accumulated other comprehensive loss at March 31, 2020 $ (354,825 ) (a) - All amounts are presented net of tax. (b) - Based on March 31, 2020 , commodity prices, we expect to realize $73.0 million in net gains, net of tax, over the next 12 months and $0.8 million in net losses, net of tax, thereafter. (c) - We expect losses of $29.4 million , net of tax, will be reclassified into earnings during the next 12 months as the hedged items affect earnings. |
EARNINGS PER SHARE EARNINGS P_2
EARNINGS PER SHARE EARNINGS PER SHARE (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | The following tables set forth the computation of basic and diluted EPS for the periods indicated: Three Months Ended March 31, 2020 Income (Loss) Shares Per Share Amount ( Thousands, except per share amounts ) Basic EPS Net loss available for common stock $ (142,132 ) 414,282 $ (0.34 ) Diluted EPS Effect of dilutive securities — 1,066 Net loss available for common stock and common stock equivalents $ (142,132 ) 415,348 $ (0.34 ) Three Months Ended March 31, 2019 Income (Loss) Shares Per Share Amount ( Thousands, except per share amounts ) Basic EPS Net income available for common stock $ 336,933 412,908 $ 0.82 Diluted EPS Effect of dilutive securities — 2,325 Net income available for common stock and common stock equivalents $ 336,933 415,233 $ 0.81 |
EMPLOYEE BENEFIT PLANS EMPLOY_2
EMPLOYEE BENEFIT PLANS EMPLOYEE BENEFIT PLANS (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Defined Benefit Plan [Abstract] | |
Components of net periodic benefit cost for retirement and other postretirement benefit plans | The following table sets forth the components of net periodic benefit cost for our retirement and other postretirement benefit plans for the periods indicated: Retirement Benefits Other Postretirement Benefits Three Months Ended Three Months Ended March 31, March 31, 2020 2019 2020 2019 ( Thousands of dollars ) Components of net periodic benefit cost Service cost $ 2,036 $ 1,954 $ 115 $ 117 Interest cost 4,574 5,126 442 509 Expected return on plan assets (6,232 ) (5,892 ) (722 ) (570 ) Amortization of prior service cost (credit) (a) 28 — — (57 ) Amortization of net loss (a) 4,571 3,158 1 74 Net periodic benefit cost (income) $ 4,977 $ 4,346 $ (164 ) $ 73 (a) - These components of net periodic benefit cost are recognized in accumulated other comprehensive loss and are reclassified to other income (expense) in our Consolidated Statements of Income, with related income tax benefits of $1.1 million and $0.7 million reclassified to income tax (expense) benefit for the three months ended March 31, 2020 and 2019, respectively. |
UNCONSOLIDATED AFFILIATES (Tabl
UNCONSOLIDATED AFFILIATES (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Equity In Net Earnings From Investments | |
Schedule of Equity Method Investments [Line Items] | |
Schedule of Equity Method Investments [Table Text Block] | The following table sets forth our equity in net earnings (loss) from investments for the periods indicated: Three Months Ended March 31, 2020 2019 ( Thousands of dollars ) Northern Border Pipeline $ 22,120 $ 20,802 Overland Pass Pipeline 14,111 17,394 Roadrunner 6,433 6,338 Other 1,963 (1,053 ) Equity in net earnings from investments $ 44,627 $ 43,481 Impairment of equity investments $ (37,730 ) $ — |
LEASES (Tables)
LEASES (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Lease Assets and Liabilities Included in the Consolidated Balance Sheet[Table Text Block] | The following table sets forth information about our supplemental cash flows related to our leases: Three Months Ended March 31, 2020 2019 ( Thousands of dollars ) Cash paid for amounts included in the measurement of lease liabilities Operating cash flows for operating leases $ 2,840 $ 1,519 Financing cash flows for finance lease $ 469 $ 425 Right-of-use assets obtained in exchange for operating lease liabilities (noncash) $ 97,339 $ 380 |
Lessee, Operating Lease, Liability, Maturity [Table Text Block] | The following table sets forth the maturity of our lease liabilities as of March 31, 2020 : Finance Lease Operating Leases ( Millions of dollars ) Remainder of 2020 $ 3.4 $ 12.4 2021 4.5 16.3 2022 4.5 14.9 2023 4.5 13.7 2024 4.5 12.4 2025 and beyond 17.1 57.0 Total lease payments 38.5 126.7 Less: Interest 12.7 16.8 Present value of lease liabilities $ 25.8 $ 109.9 |
Finance Lease, Liability, Maturity [Table Text Block] | The following table sets forth the maturity of our lease liabilities as of March 31, 2020 : Finance Lease Operating Leases ( Millions of dollars ) Remainder of 2020 $ 3.4 $ 12.4 2021 4.5 16.3 2022 4.5 14.9 2023 4.5 13.7 2024 4.5 12.4 2025 and beyond 17.1 57.0 Total lease payments 38.5 126.7 Less: Interest 12.7 16.8 Present value of lease liabilities $ 25.8 $ 109.9 |
REVENUE REVENUE (Tables)
REVENUE REVENUE (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Contract with Customer, Asset and Liability [Table Text Block] | The following table sets forth the balances in contract liabilities for the periods indicated: Contract Liabilities ( Millions of dollars ) Balance at December 31, 2019 (a) $ 57.1 Revenue recognized included in beginning balance (18.2 ) Net additions 6.8 Balance at March 31, 2020 (b) $ 45.7 (a) - Contract liabilities of $ 22.2 million and $ 34.9 million are included in other current liabilities and other deferred credits, respectively, in our Consolidated Balance Sheet. (b) - Contract liabilities of $ 11.9 million and $ 33.8 million are included in other current liabilities and other deferred credits, respectively, in our Consolidated Balance Sheet. |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Table Text Block] | The following table presents aggregate value allocated to unsatisfied performance obligations as of March 31, 2020 , and the amounts we expect to recognize in revenue in future periods, related primarily to firm transportation and storage contracts with remaining contract terms ranging from one month to 24 years : Expected Period of Recognition in Revenue ( Millions of dollars ) Remainder of 2020 $ 257.2 2021 305.3 2022 230.9 2023 184.6 2024 and beyond 853.9 Total estimated transaction price allocated to unsatisfied performance obligations $ 1,831.9 |
SEGMENTS (Tables)
SEGMENTS (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Segment Reporting, Disclosure of Entity's Reportable Segments [Abstract] | |
Segments | Operating Segment Information - The following tables set forth certain selected financial information for our operating segments for the periods indicated: Three Months Ended Natural Gas Natural Gas Natural Gas Total Segments ( Thousands of dollars ) NGL and condensate sales $ 219,917 $ 1,596,711 $ — $ 1,816,628 Residue natural gas sales 189,051 — 2,035 191,086 Gathering, processing and exchange services revenue 37,937 120,536 — 158,473 Transportation and storage revenue — 50,755 118,364 169,119 Other 3,075 2,590 384 6,049 Total revenues (c) 449,980 1,770,592 120,783 2,341,355 Cost of sales and fuel (exclusive of depreciation and operating costs) (202,170 ) (1,278,754 ) (1,539 ) (1,482,463 ) Operating costs (84,470 ) (89,571 ) (33,307 ) (207,348 ) Equity in net earnings from investments 806 15,268 28,553 44,627 Noncash compensation expense and other (4,498 ) (6,619 ) (1,966 ) (13,083 ) Segment adjusted EBITDA $ 159,648 $ 410,916 $ 112,524 $ 683,088 Depreciation and amortization $ (58,756 ) $ (57,841 ) $ (14,769 ) $ (131,366 ) Impairment charges $ (564,353 ) $ (77,401 ) $ — $ (641,754 ) Investments in unconsolidated affiliates $ 4,276 $ 435,024 $ 371,179 $ 810,479 Total assets $ 6,374,552 $ 12,682,807 $ 2,089,362 $ 21,146,721 Capital expenditures $ 181,610 $ 746,183 $ 16,590 $ 944,383 (a) - Our Natural Gas Liquids segment has regulated and nonregulated operations. Our Natural Gas Liquids segment’s regulated operations had revenues of $435.1 million , of which $378.2 million related to revenues within the segment, and cost of sales and fuel of $120.4 million . (b) - Our Natural Gas Pipelines segment has regulated and nonregulated operations. Our Natural Gas Pipelines segment’s regulated operations had revenues of $73.9 million and cost of sales and fuel of $6.1 million . (c) - Intersegment revenues for the Natural Gas Gathering and Processing segment totaled $213.3 million . Intersegment revenues for the Natural Gas Liquids and Natural Gas Pipelines segments were not material. Three Months Ended Total Segments Other and Eliminations Total ( Thousands of dollars ) Reconciliations of total segments to consolidated NGL and condensate sales $ 1,816,628 $ (199,472 ) $ 1,617,156 Residue natural gas sales 191,086 (1,032 ) 190,054 Gathering, processing and exchange services revenue 158,473 — 158,473 Transportation and storage revenue 169,119 (3,809 ) 165,310 Other 6,049 (370 ) 5,679 Total revenues (a) $ 2,341,355 $ (204,683 ) $ 2,136,672 Cost of sales and fuel (exclusive of depreciation and operating costs) $ (1,482,463 ) $ 205,535 $ (1,276,928 ) Operating costs $ (207,348 ) $ 308 $ (207,040 ) Depreciation and amortization $ (131,366 ) $ (987 ) $ (132,353 ) Impairment charges $ (641,754 ) $ — $ (641,754 ) Equity in net earnings from investments $ 44,627 $ — $ 44,627 Investments in unconsolidated affiliates $ 810,479 $ — $ 810,479 Total assets $ 21,146,721 $ 822,719 $ 21,969,440 Capital expenditures $ 944,383 $ 5,296 $ 949,679 (a) - Noncustomer revenue for the three months ended March 31, 2020 , totaled $80.2 million related primarily to gains from derivatives on commodity contracts. Three Months Ended Natural Gas Gathering and Processing Natural Gas Liquids (a) Natural Gas Pipelines (b) Total Segments ( Thousands of dollars ) NGL and condensate sales $ 332,332 $ 2,158,103 $ — $ 2,490,435 Residue natural gas sales 319,036 — 970 320,006 Gathering, processing and exchange services revenue 39,742 98,534 — 138,276 Transportation and storage revenue — 52,322 112,865 165,187 Other 3,551 2,541 2,565 8,657 Total revenues (c) 694,661 2,311,500 116,400 3,122,561 Cost of sales and fuel (exclusive of depreciation and operating costs) (450,913 ) (1,846,673 ) (1,755 ) (2,299,341 ) Operating costs (94,247 ) (110,438 ) (36,268 ) (240,953 ) Equity in net earnings (loss) from investments (1,202 ) 17,544 27,139 43,481 Noncash compensation expense and other 3,945 5,706 1,132 10,783 Segment adjusted EBITDA $ 152,244 $ 377,639 $ 106,648 $ 636,531 Depreciation and amortization $ (52,681 ) $ (46,401 ) $ (14,156 ) $ (113,238 ) Investments in unconsolidated affiliates $ 39,749 $ 447,272 $ 463,903 $ 950,924 Total assets $ 6,208,883 $ 10,220,412 $ 2,138,759 $ 18,568,054 Capital expenditures $ 215,148 $ 639,338 $ 28,688 $ 883,174 (a) - Our Natural Gas Liquids segment has regulated and nonregulated operations. Our Natural Gas Liquids segment’s regulated operations had revenues of $323.1 million , of which $270.0 million related to sales within the segment, and cost of sales and fuel of $118.5 million . (b) - Our Natural Gas Pipelines segment has regulated and nonregulated operations. Our Natural Gas Pipelines segment’s regulated operations had revenues of $70.1 million and cost of sales and fuel of $5.6 million . (c) - Intersegment revenues for the Natural Gas Gathering and Processing segment totaled $335.8 million . Intersegment revenues for the Natural Gas Liquids and Natural Gas Pipelines segments were not material. Three Months Ended Total Segments Other and Eliminations Total ( Thousands of dollars ) Reconciliations of total segments to consolidated NGL and condensate sales $ 2,490,435 $ (338,351 ) $ 2,152,084 Residue natural gas sales 320,006 — 320,006 Gathering, processing and exchange services revenue 138,276 — 138,276 Transportation and storage revenue 165,187 (3,937 ) 161,250 Other 8,657 (315 ) 8,342 Total revenues (a) $ 3,122,561 $ (342,603 ) $ 2,779,958 Cost of sales and fuel (exclusive of depreciation and operating costs) $ (2,299,341 ) $ 342,964 $ (1,956,377 ) Operating costs $ (240,953 ) $ 212 $ (240,741 ) Depreciation and amortization $ (113,238 ) $ (920 ) $ (114,158 ) Equity in net earnings from investments $ 43,481 $ — $ 43,481 Investments in unconsolidated affiliates $ 950,924 $ — $ 950,924 Total assets $ 18,568,054 $ 366,271 $ 18,934,325 Capital expenditures $ 883,174 $ 6,531 $ 889,705 (a) - Noncustomer revenue for the three months ended March 31, 2019 , totaled $22.3 million related primarily to gains from derivatives on commodity contracts. Three Months Ended March 31, 2020 2019 ( Thousands of dollars ) Reconciliation of net income (loss) to total segment adjusted EBITDA Net income (loss) $ (141,857 ) $ 337,208 Add: Interest expense, net of capitalized interest 140,616 115,420 Depreciation and amortization 132,353 114,158 Income tax expense (benefit) (55,395 ) 77,934 Impairment charges 641,754 — Noncash compensation expense (1,302 ) 5,540 Other corporate costs and noncash items (a) (33,081 ) (13,729 ) Total segment adjusted EBITDA $ 683,088 $ 636,531 (a) - The three months ended March 31, 2020, includes a corporate $15.8 million gain on extinguishment of debt related to open market repurchases. |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Entity Information [Line Items] | |||
Goodwill | $ 527,592 | $ 680,996 | |
Impairment of equity investments | 37,730 | $ 0 | |
Natural Gas Gathering And Processing [Member] | |||
Entity Information [Line Items] | |||
Impairment of long-lived assets | 380,500 | ||
Impairment of intangible assets | 19,900 | ||
Goodwill | 0 | 153,404 | |
Goodwill impairment charge | $ 153,400 | ||
Natural Gas Gathering And Processing [Member] | Venice Energy Services Company [Member] | |||
Entity Information [Line Items] | |||
Equity Method Investment, Ownership Percentage | 10.20% | ||
Impairment of equity investments - goodwill | $ 22,300 | ||
Impairment of equity investments | 30,500 | ||
Natural Gas Liquids | |||
Entity Information [Line Items] | |||
Impairment of long-lived assets | 70,200 | ||
Goodwill | $ 371,217 | 371,217 | |
Natural Gas Liquids | Chisholm Pipeline Company [Member] | |||
Entity Information [Line Items] | |||
Equity Method Investment, Ownership Percentage | 50.00% | ||
Impairment of equity investments | $ 7,200 | ||
Natural Gas Pipelines | |||
Entity Information [Line Items] | |||
Goodwill | $ 156,375 | $ 156,375 |
FAIR VALUE MEASUREMENTS - Part
FAIR VALUE MEASUREMENTS - Part 1 (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash held - offsetting derivative net asset positions under master-netting arrangements | $ (66,900) | $ 0 |
Cash posted - total | 0 | 8,800 |
Long-term debt, Fair Value | 11,900,000 | 13,800,000 |
Long-term debt | 14,200,000 | 12,500,000 |
Fair Value, Recurring [Member] | ||
Derivative assets | ||
Derivative assets | 27,164 | 38,442 |
Derivative assets netting | (140,707) | (28,588) |
Derivative liabilities | ||
Derivative liabilities | (270,297) | (202,949) |
Derivative liabilities netting | 73,783 | 28,588 |
Fair Value, Recurring [Member] | Financial Contracts [Member] | ||
Derivative assets | ||
Derivative assets | 27,164 | 37,861 |
Derivative assets netting | (140,707) | (28,588) |
Derivative liabilities | ||
Derivative liabilities | 0 | (1,008) |
Derivative liabilities netting | 73,783 | 28,588 |
Fair Value, Recurring [Member] | Interest-rate contracts | ||
Derivative assets | ||
Interest-rate contracts | 581 | |
Derivative assets netting | 0 | |
Derivative liabilities | ||
Interest rate derivative liabilities, at fair value | (270,297) | (201,941) |
Derivative liabilities netting | 0 | 0 |
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Derivative assets | ||
Derivative asset, fair value, gross | 37,599 | 10,892 |
Derivative liability, fair value, gross | (911) | (4,811) |
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | Financial Contracts [Member] | ||
Derivative assets | ||
Derivative asset, fair value, gross | 37,599 | 10,892 |
Derivative liability, fair value, gross | (911) | (4,811) |
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | Interest-rate contracts | ||
Derivative assets | ||
Interest-rate contracts | 0 | |
Derivative liabilities | ||
Interest rate derivative liabilities, at fair value | 0 | 0 |
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Derivative assets | ||
Derivative asset, fair value, gross | 0 | 581 |
Derivative liability, fair value, gross | (270,297) | (201,941) |
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | Financial Contracts [Member] | ||
Derivative assets | ||
Derivative asset, fair value, gross | 0 | 0 |
Derivative liability, fair value, gross | 0 | 0 |
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | Interest-rate contracts | ||
Derivative assets | ||
Interest-rate contracts | 581 | |
Derivative liabilities | ||
Interest rate derivative liabilities, at fair value | (270,297) | (201,941) |
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Derivative assets | ||
Derivative asset, fair value, gross | 130,272 | 55,557 |
Derivative liability, fair value, gross | (72,871) | (24,785) |
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | Financial Contracts [Member] | ||
Derivative assets | ||
Derivative asset, fair value, gross | 130,272 | 55,557 |
Derivative liability, fair value, gross | (72,871) | (24,785) |
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | Interest-rate contracts | ||
Derivative assets | ||
Interest-rate contracts | 0 | |
Derivative liabilities | ||
Interest rate derivative liabilities, at fair value | 0 | 0 |
Fair Value, Recurring [Member] | Estimate of Fair Value Measurement [Member] | ||
Derivative assets | ||
Derivative asset, fair value, gross | 167,871 | 67,030 |
Derivative liability, fair value, gross | (344,080) | (231,537) |
Fair Value, Recurring [Member] | Estimate of Fair Value Measurement [Member] | Financial Contracts [Member] | ||
Derivative assets | ||
Derivative asset, fair value, gross | 167,871 | 66,449 |
Derivative liability, fair value, gross | (73,783) | (29,596) |
Fair Value, Recurring [Member] | Estimate of Fair Value Measurement [Member] | Interest-rate contracts | ||
Derivative assets | ||
Interest-rate contracts | 581 | |
Derivative liabilities | ||
Interest rate derivative liabilities, at fair value | $ (270,297) | $ (201,941) |
FAIR VALUE MEASUREMENTS - Par_2
FAIR VALUE MEASUREMENTS - Part 2 (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Fair Value, Assets And Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Abstract] | ||
Net assets (liabilities) at beginning of period | $ 30,772 | $ 40,484 |
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Inputs Reconciliation, Settlements | (16,146) | (25,361) |
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Inputs Reconciliation, New Level 3 Derivatives | 20,993 | 1,597 |
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Inputs Reconciliation, Unrealized Change Included in other comprehensive income (loss) | 21,782 | (5,191) |
Net assets (liabilities) at end of period | 57,401 | 11,529 |
Transfers in or out of level 3 | $ 0 | $ 0 |
RISK MANAGEMENT AND HEDGING A_3
RISK MANAGEMENT AND HEDGING ACTIVITIES USING DERIVATIVES Part 1 (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Derivative, Fair Value [Line Items] | ||
Derivative, Net Liability Position, Aggregate Fair Value | $ 0 | |
Derivatives designated as hedging instruments | ||
Derivative, Fair Value [Line Items] | ||
Assets | 167,871 | $ 67,030 |
(Liabilities) | (344,080) | (231,537) |
Natural Gas Pipelines | ||
Derivative, Fair Value [Line Items] | ||
Derivative, Fair Value, Net | 0 | 0 |
Other Current Assets [Member] | Commodity contracts | Financial contracts | Derivatives designated as hedging instruments | ||
Derivative, Fair Value [Line Items] | ||
Assets | 167,871 | 64,858 |
(Liabilities) | (73,783) | (26,997) |
Other Current Liabilities [Member] | Interest-rate contracts | Derivatives designated as hedging instruments | ||
Derivative, Fair Value [Line Items] | ||
Assets | 0 | 0 |
(Liabilities) | (28,673) | (90,161) |
Other Deferred Credits | Commodity contracts | Financial contracts | Derivatives designated as hedging instruments | ||
Derivative, Fair Value [Line Items] | ||
Assets | 0 | 1,591 |
(Liabilities) | 0 | (2,599) |
Other Deferred Credits | Interest-rate contracts | Derivatives designated as hedging instruments | ||
Derivative, Fair Value [Line Items] | ||
Assets | 0 | |
(Liabilities) | (241,624) | (111,780) |
Other Assets [Member] | Interest-rate contracts | Derivatives designated as hedging instruments | ||
Derivative, Fair Value [Line Items] | ||
Assets | 581 | |
Interest-rate contracts | LIBOR Based Interest Payments [Member] | Cash Flow Hedging [Member] | Forward Contracts | ||
Derivative, Fair Value [Line Items] | ||
Derivative, Notional Amount | $ 1,300,000 | $ 1,300,000 |
RISK MANAGEMENT AND HEDGING A_4
RISK MANAGEMENT AND HEDGING ACTIVITIES USING DERIVATIVES, Part 2 (Details) $ in Millions | 3 Months Ended | |
Mar. 31, 2020USD ($)MMcfMMBbls | Dec. 31, 2019USD ($)MMcfMMBbls | |
Derivative [Line Items] | ||
Notional Amount Of Cash Flow Hedge Instruments Settled | $ 750 | |
Designated as Hedging Instrument [Member] | Futures and swaps | - Natural gas (Bcf) | Fixed price | Purchased/ Payor | ||
Derivative [Line Items] | ||
Derivative, Nonmonetary Notional Amount | MMcf | 0 | 0 |
Designated as Hedging Instrument [Member] | Futures and swaps | - Natural gas (Bcf) | Fixed price | Sold/ Receiver | ||
Derivative [Line Items] | ||
Derivative, Nonmonetary Notional Amount | MMcf | (47,600) | (59,000) |
Designated as Hedging Instrument [Member] | Futures and swaps | - Natural gas (Bcf) | Basis | Purchased/ Payor | ||
Derivative [Line Items] | ||
Derivative, Nonmonetary Notional Amount | MMcf | 0 | 0 |
Designated as Hedging Instrument [Member] | Futures and swaps | - Natural gas (Bcf) | Basis | Sold/ Receiver | ||
Derivative [Line Items] | ||
Derivative, Nonmonetary Notional Amount | MMcf | (47,600) | (59,000) |
Designated as Hedging Instrument [Member] | Futures, forwards and swaps | - Crude oil and NGLs (MMBbl) | Fixed price | Purchased/ Payor | ||
Derivative [Line Items] | ||
Derivative, Nonmonetary Notional Amount | MMBbls | 10.5 | 7.9 |
Designated as Hedging Instrument [Member] | Futures, forwards and swaps | - Crude oil and NGLs (MMBbl) | Fixed price | Sold/ Receiver | ||
Derivative [Line Items] | ||
Derivative, Nonmonetary Notional Amount | MMBbls | (17.5) | (17.4) |
Designated as Hedging Instrument [Member] | Interest Rate Contract | Purchased/ Payor | ||
Derivative [Line Items] | ||
Derivative, Notional Amount | $ 2,400 | $ 3,100 |
Designated as Hedging Instrument [Member] | Interest Rate Contract | Sold/ Receiver | ||
Derivative [Line Items] | ||
Derivative, Notional Amount | 0 | 0 |
LIBOR Based Interest Payments [Member] | Cash Flow Hedging [Member] | Forward Contracts | Interest Rate Contract | ||
Derivative [Line Items] | ||
Derivative, Notional Amount | 1,300 | 1,300 |
Forecasted Debt Issuances [Member] | Cash Flow Hedging [Member] | Forward Contracts | Interest Rate Contract | ||
Derivative [Line Items] | ||
Derivative, Notional Amount | 1,100 | $ 1,800 |
Notes Payable from Public Offering Due 2025, 2030 and 2050 [Member] | ||
Derivative [Line Items] | ||
Senior notes, noncurrent | $ 1,750 |
RISK MANAGEMENT AND HEDGING A_5
RISK MANAGEMENT AND HEDGING ACTIVITIES USING DERIVATIVES Part 3 (Details) - Cash Flow Hedging [Member] - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||
Unrealized change in fair value of cash flow hedges in other comprehensive income (loss) | $ (137,846) | $ (89,537) |
Change in fair value of cash flow hedges reclassified from accumulated other comprehensive loss into net income (loss) on derivatives | 19,682 | 16,348 |
Commodity contracts | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Unrealized change in fair value of cash flow hedges in other comprehensive income (loss) | 87,195 | (21,625) |
Commodity contracts | Commodity sales revenues | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Change in fair value of cash flow hedges reclassified from accumulated other comprehensive loss into net income (loss) on derivatives | 44,999 | 23,822 |
Commodity contracts | Cost of sales and fuel | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Change in fair value of cash flow hedges reclassified from accumulated other comprehensive loss into net income (loss) on derivatives | (15,039) | (4,970) |
Interest Rate Contract | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Unrealized change in fair value of cash flow hedges in other comprehensive income (loss) | (225,041) | (67,912) |
Interest Rate Contract | Interest expense | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Change in fair value of cash flow hedges reclassified from accumulated other comprehensive loss into net income (loss) on derivatives | $ (10,278) | $ (2,504) |
DEBT DEBT (Details)
DEBT DEBT (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020USD ($)Rate | Dec. 31, 2019USD ($)Rate | |
Debt Instrument [Line Items] | ||
Total debt | $ 14,274,773 | $ 12,813,704 |
Unamortized Portion of Terminated Swaps | 14,603 | 15,032 |
Unamortized debt issuance costs and discounts | (135,076) | (121,329) |
Current maturities of long-term debt | (7,650) | (7,650) |
Short-term borrowings | 0 | (220,000) |
Long-term debt | 14,146,650 | 12,479,757 |
Repayments of Debt | 50,500 | |
Debt Instrument, Repurchased Face Amount | 67,000 | |
Gain (loss) on extinguishment of debt | $ 15,800 | |
$2.5 Billion Credit Agreement [Member] | ||
Debt Instrument [Line Items] | ||
Debt Instrument, Covenant Description | Among other things, these covenants include maintaining a ratio of indebtedness to adjusted EBITDA (EBITDA, as defined in our $2.5 Billion Credit Agreement, adjusted for all noncash charges and increased for projected EBITDA from certain lender-approved capital expansion projects) of no more than 5.0 to 1 at March 31, 2020. At March 31, 2020, we had no borrowings outstanding, our ratio of indebtedness to adjusted EBITDA was 4.5 to 1, and we were in compliance with all covenants under our $2.5 Billion Credit Agreement. | |
Line of Credit Facility, Amount Outstanding | $ 0 | |
Indebtedness To Adjusted Ebitda Current | 4.5 | |
Indebtedness To Adjusted EBITDA Maximum | 5 | |
Line of Credit Facility, Maximum Borrowing Capacity | $ 2,500,000 | |
Notes Payable from Public Offering Due 2025, 2030 and 2050 [Member] | ||
Debt Instrument [Line Items] | ||
Senior notes, noncurrent | 1,750,000 | |
Proceeds from Debt, Net of Issuance Costs | 1,730,000 | |
Guardian Pipeline [Member] | Notes Payables 1 due 2022 [Member] | ||
Debt Instrument [Line Items] | ||
Total debt | $ 19,395 | 21,307 |
Long-term Debt, Weighted Average Interest Rate, at Point in Time | Rate | 7.85% | |
Subsidiary Issuer [Member] | 3.375% Notes Payable due 2022 [Member] | ||
Debt Instrument [Line Items] | ||
Total debt | $ 900,000 | 900,000 |
Interest Rate (in hundredths) | Rate | 3.375% | |
Subsidiary Issuer [Member] | 5.0% Notes Payable due 2023 [Member] | ||
Debt Instrument [Line Items] | ||
Total debt | $ 425,000 | 425,000 |
Interest Rate (in hundredths) | Rate | 5.00% | |
Subsidiary Issuer [Member] | 4.9% Notes Payable due 2025 [Member] | ||
Debt Instrument [Line Items] | ||
Total debt | $ 500,000 | 500,000 |
Interest Rate (in hundredths) | Rate | 4.90% | |
Subsidiary Issuer [Member] | 6.65% Notes Payable due 2036 [Member] | ||
Debt Instrument [Line Items] | ||
Total debt | $ 600,000 | 600,000 |
Interest Rate (in hundredths) | Rate | 6.65% | |
Subsidiary Issuer [Member] | 6.85% Notes Payable due 2037 [Member] | ||
Debt Instrument [Line Items] | ||
Total debt | $ 600,000 | 600,000 |
Interest Rate (in hundredths) | Rate | 6.85% | |
Subsidiary Issuer [Member] | 6.125% Notes Payable due 2041 [Member] | ||
Debt Instrument [Line Items] | ||
Total debt | $ 650,000 | 650,000 |
Interest Rate (in hundredths) | Rate | 6.125% | |
Subsidiary Issuer [Member] | 6.2% Notes Payable due 2043 [Member] | ||
Debt Instrument [Line Items] | ||
Total debt | $ 400,000 | $ 400,000 |
Interest Rate (in hundredths) | Rate | 6.20% | |
Parent Company | ||
Debt Instrument [Line Items] | ||
Short-term Debt, Weighted Average Interest Rate, at Point in Time | Rate | 0.00% | 2.16% |
Commercial paper | $ 0 | $ 220,000 |
Parent Company | Term Loan Agreement due 2021 [Member] | ||
Debt Instrument [Line Items] | ||
Total debt | 1,250,000 | 1,250,000 |
Parent Company | 4.25% Notes Payable due 2022 [Member] | ||
Debt Instrument [Line Items] | ||
Total debt | $ 547,397 | 547,397 |
Interest Rate (in hundredths) | Rate | 4.25% | |
Parent Company | 7.5% Notes Payable due 2023 [Member] | ||
Debt Instrument [Line Items] | ||
Total debt | $ 500,000 | 500,000 |
Interest Rate (in hundredths) | Rate | 7.50% | |
Parent Company | 2.75% Notes Payable due 2024 [Member] | ||
Debt Instrument [Line Items] | ||
Total debt | $ 500,000 | 500,000 |
Interest Rate (in hundredths) | Rate | 2.75% | |
Parent Company | 2.2% Notes Payable due 2025 [Member] | ||
Debt Instrument [Line Items] | ||
Debt Instrument, Face Amount | $ 400,000 | |
Total debt | $ 397,000 | 0 |
Interest Rate (in hundredths) | Rate | 2.20% | |
Parent Company | 4.0% Notes Payable due 2027 [Member] | ||
Debt Instrument [Line Items] | ||
Total debt | $ 500,000 | 500,000 |
Interest Rate (in hundredths) | Rate | 4.00% | |
Parent Company | 4.55% Notes Payable due 2028 [Member] | ||
Debt Instrument [Line Items] | ||
Total debt | $ 800,000 | 800,000 |
Interest Rate (in hundredths) | Rate | 4.55% | |
Parent Company | 6.875% Notes Payable due 2028 [Member] | ||
Debt Instrument [Line Items] | ||
Total debt | $ 100,000 | 100,000 |
Interest Rate (in hundredths) | Rate | 6.875% | |
Parent Company | 4.35% Notes Payable due 2029 [Member] | ||
Debt Instrument [Line Items] | ||
Total debt | $ 700,000 | 700,000 |
Interest Rate (in hundredths) | Rate | 4.35% | |
Parent Company | 3.4% Notes Payable due 2029 [Member] | ||
Debt Instrument [Line Items] | ||
Total debt | $ 734,251 | 750,000 |
Interest Rate (in hundredths) | Rate | 3.40% | |
Parent Company | 3.1% Notes Payable due 2030 [Member] | ||
Debt Instrument [Line Items] | ||
Debt Instrument, Face Amount | $ 850,000 | |
Total debt | $ 821,050 | 0 |
Interest Rate (in hundredths) | Rate | 3.10% | |
Parent Company | 6.0% Notes Payable due 2035 [Member] | ||
Debt Instrument [Line Items] | ||
Total debt | $ 400,000 | 400,000 |
Interest Rate (in hundredths) | Rate | 6.00% | |
Parent Company | 4.95% Notes Payable due 2047 [Member] | ||
Debt Instrument [Line Items] | ||
Total debt | $ 693,405 | 700,000 |
Interest Rate (in hundredths) | Rate | 4.95% | |
Parent Company | 5.2% Notes Payable due 2048 [Member] | ||
Debt Instrument [Line Items] | ||
Total debt | $ 1,000,000 | 1,000,000 |
Interest Rate (in hundredths) | Rate | 5.20% | |
Parent Company | 4.45% Notes Payable due 2049 [Member] | ||
Debt Instrument [Line Items] | ||
Total debt | $ 747,650 | 750,000 |
Interest Rate (in hundredths) | Rate | 4.45% | |
Parent Company | 4.5% Notes Payable due 2050 [Member] | ||
Debt Instrument [Line Items] | ||
Debt Instrument, Face Amount | $ 500,000 | |
Total debt | $ 489,625 | $ 0 |
Interest Rate (in hundredths) | Rate | 4.50% | |
Term Loan Agreement due 2021 [Member] | Parent Company | ||
Debt Instrument [Line Items] | ||
Debt Instrument, Face Amount | $ 1,500,000 |
EQUITY (Details)
EQUITY (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | ||
Jun. 30, 2020 | Mar. 31, 2020 | Mar. 31, 2019 | |
Dividends, Per Share, Cash Paid | $ 0.935 | $ 0.86 | |
Dividends, Preferred Stock, Cash | $ 300 | ||
Preferred Stock, Dividends, Declared | $ 275 | $ 275 | |
Series E Preferred Stock [Member] | |||
Preferred Stock, Dividend Rate, Percentage | 5.50% | ||
Subsequent Event [Member] | |||
Common Stock, Dividends, Per Share, Declared | $ 0.935 | ||
Dividends Payable, Date of Record | Apr. 27, 2020 | ||
Dividends Payable, Date to be Paid | May 14, 2020 | ||
Preferred Stock, Dividends, Declared | $ 300 |
ACCUMULATED OTHER COMPREHENSI_3
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Risk management assets/liabilities - January 1 | $ (233,520) | |
Retirement and other postretirement benefit plan obligations - January 1 | (131,481) | |
Risk-management assets/liabilities of unconsolidated affiliates - January 1 | (8,999) | |
Accumulated other comprehensive loss - January 1 | (374,000) | |
Other comprehensive income (loss) before reclassification, risk-management assets/liabilities | (106,141) | $ (68,944) |
Other comprehensive (income) loss before reclassification, retirement and postretirement benefit plan obligations | 20 | |
Other comprehensive income (loss) before reclassification, risk-management assets/liabilities of unconsolidated affiliates | (7,777) | |
Other comprehensive income (loss) before reclassifications | (113,898) | |
Other comprehensive income (loss) reclassification adjustment from AOCI for risk-management assets/liabilities, net of tax | (15,164) | (12,171) |
Other comprehensive (income) loss, retirement and other postretirement benefit plans, reclassification adjustment from AOCI, net of tax | 3,542 | |
Other comprehensive income (loss), reclassification adjustment from AOCI for other comprehensive income attributable to unconsolidated affiliates, net of tax | 134 | |
Other comprehensive income (loss), reclassification adjustment included in net income, net of tax | (11,488) | |
Other comprehensive income (loss), risk-management assets/liabilities, after reclassification adjustment, net of tax | (121,305) | |
Other comprehensive (income) loss, retirement and other postretirement benefit plans, after reclassification adjustment, net of tax | 3,562 | 2,341 |
Other comprehensive income (loss), risk-management assets/liabilities of unconsolidated affiliates, net of tax | (7,643) | (2,511) |
Other comprehensive income (loss), net of tax | (125,386) | $ (81,285) |
Risk management assets/liabilities - March 31 | (354,825) | |
Retirement and other postretirement benefit plan obligations - March 31 | (127,919) | |
Risk-management assets/liabilities of unconsolidated affiliates - March 31 | (16,642) | |
Accumulated other comprehensive loss - March 31 | (499,386) | |
Price risk cash flow hedge unrealized gain (loss) to be reclassified during next 12 months | 73,000 | |
Commodity cash flow hedge gain (loss) to be reclassified after next 12 months net | (800) | |
Interest rate cash flow hedge gain (loss) to be reclassified during next 12 months, net | (29,400) | |
Cash Flow Hedging [Member] | Commodity contracts | ||
Unrealized gain loss on cash flow hedges net of tax accumulated other comprehensive income loss | 72,180 | |
Cash Flow Hedging [Member] | Interest Rate Contract | ||
Amount of accumulated other comprehensive income (loss) attributable primarily to settled interest-rate swaps. | (218,877) | |
Cash Flow Hedging [Member] | Forward Contracts | ||
Amount of accumulated other comprehensive income (loss) attributable primarily to forward starting interest-rate swaps. | $ (208,128) |
EARNINGS PER SHARE EARNINGS P_3
EARNINGS PER SHARE EARNINGS PER SHARE (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Basic EPS | ||
Net income (loss) available for common stock | $ (142,132) | $ 336,933 |
Shares | 414,282 | 412,908 |
Earnings (loss) per share, basic | $ (0.34) | $ 0.82 |
Diluted EPS | ||
Effect of dilutive securities | $ 0 | $ 0 |
Effect of dilutive securities, number of shares | 1,066 | 2,325 |
Net income (loss) available for common stock and common stock equivalents | $ (142,132) | $ 336,933 |
Shares | 415,348 | 415,233 |
Earnings (loss) per share, diluted | $ (0.34) | $ 0.81 |
EMPLOYEE BENEFIT PLANS EMPLOY_3
EMPLOYEE BENEFIT PLANS EMPLOYEE BENEFIT PLANS (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Income tax benefits reclassified from accumulated other comprehensive loss to income tax (expense) benefit | ||
Income tax benefit | $ 1,100 | $ 700 |
Retirement Benefits | ||
Components of net periodic benefit cost | ||
Service cost | 2,036 | 1,954 |
Interest cost | 4,574 | 5,126 |
Expected return on plan assets | (6,232) | (5,892) |
Amortization of net loss | 4,571 | 3,158 |
Amortization of prior service cost (credit) (a) | 28 | 0 |
Net periodic benefit cost (income) | 4,977 | 4,346 |
Other Postretirement Benefits Plan | ||
Components of net periodic benefit cost | ||
Service cost | 115 | 117 |
Interest cost | 442 | 509 |
Expected return on plan assets | (722) | (570) |
Amortization of net loss | 1 | 74 |
Amortization of prior service cost (credit) (a) | 0 | (57) |
Net periodic benefit cost (income) | $ (164) | $ 73 |
UNCONSOLIDATED AFFILIATES (Deta
UNCONSOLIDATED AFFILIATES (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Schedule of Equity Method Investments [Line Items] | |||
Equity in net earnings from investments | $ 44,627 | $ 43,481 | |
Accounts Payable, Related Parties, Current | 14,700 | $ 13,500 | |
Impairment of equity investments | (37,730) | 0 | |
Equity-method goodwill | 16,500 | ||
Unconsolidated Affiliates [Member] | |||
Schedule of Equity Method Investments [Line Items] | |||
Related Party Transaction, Expenses from Transactions with Related Parties | 45,300 | 41,800 | |
Northern Border Pipeline | |||
Schedule of Equity Method Investments [Line Items] | |||
Equity in net earnings from investments | 22,120 | 20,802 | |
Overland Pass Pipeline | |||
Schedule of Equity Method Investments [Line Items] | |||
Equity in net earnings from investments | 14,111 | 17,394 | |
Roadrunner | |||
Schedule of Equity Method Investments [Line Items] | |||
Equity in net earnings from investments | 6,433 | 6,338 | |
Other Unconsolidated Affiliates | |||
Schedule of Equity Method Investments [Line Items] | |||
Equity in net earnings from investments | 1,963 | $ (1,053) | |
Natural Gas Liquids | Chisholm Pipeline Company [Member] | |||
Schedule of Equity Method Investments [Line Items] | |||
Impairment of equity investments | $ (7,200) | ||
Equity Method Investment, Ownership Percentage | 50.00% | ||
Natural Gas Gathering And Processing [Member] | Venice Energy Services Company [Member] | |||
Schedule of Equity Method Investments [Line Items] | |||
Impairment of equity investments | $ (30,500) | ||
Equity Method Investment, Ownership Percentage | 10.20% | ||
Impairment of equity investments - goodwill | $ (22,300) |
LEASES (Details)
LEASES (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Jan. 01, 2020 | |
Lessee, Operating Lease, Details [Line Items] | |||
Operating cash flows for operating leases | $ 2,840 | $ 1,519 | |
Financing cash flows for finance lease | 469 | 425 | |
Right-of-use assets obtained in exchange for operating lease liabilities (noncash) | 97,339 | $ 380 | |
Lease remaining balance related to lease entered in December 2019 [Member] [Member] [Member] | |||
Lessee, Operating Lease, Details [Line Items] | |||
Lease liability remaining balance | 74,200 | ||
Right-of-use asset remaining balance | 74,000 | ||
Term of contract | 10 years | ||
Certain Operating Leases Entered Into During The Period [Member] | |||
Lessee, Operating Lease, Details [Line Items] | |||
Lease liability remaining balance | 17,200 | ||
Right-of-use asset remaining balance | $ 17,200 | ||
Weighted-Average Remaining Lease Term [Member] | |||
Lessee, Operating Lease, Details [Line Items] | |||
Operating Lease, Weighted Average Remaining Lease Term | 8 years 9 months 18 days | ||
Weighted-Average Discount Rate [Member] | |||
Lessee, Operating Lease, Details [Line Items] | |||
Operating Lease, Weighted Average Discount Rate, Percent | 3.15% | ||
Maturity of Finance Lease Liability | |||
Lessee, Operating Lease, Details [Line Items] | |||
Remainder of 2020 | $ 3,400 | ||
2021 | 4,500 | ||
2022 | 4,500 | ||
2023 | 4,500 | ||
2024 | 4,500 | ||
2025 and beyond | 17,100 | ||
Total lease payments | 38,500 | ||
Less: Interest | 12,700 | ||
Present value of lease liabilities | 25,800 | ||
Maturity of Operating Lease Liabilities | |||
Lessee, Operating Lease, Details [Line Items] | |||
Remainder of 2020 | 12,400 | ||
2021 | 16,300 | ||
2022 | 14,900 | ||
2023 | 13,700 | ||
2024 | 12,400 | ||
2025 and beyond | 57,000 | ||
Total lease payments | 126,700 | ||
Less: Interest | 16,800 | ||
Lease liability remaining balance | $ 109,900 |
REVENUE REVENUE (Details)
REVENUE REVENUE (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Dec. 31, 2019 | |
Contract with Customer, Liability [Abstract] | ||
Contract with customer, liability | $ 45.7 | $ 57.1 |
Revenue recognized included in beginning balance | (18.2) | |
Net additions | 6.8 | |
Contract with Customer, Liability, Current | 11.9 | 22.2 |
Contract with Customer, Liability, Noncurrent | 33.8 | $ 34.9 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Amount | $ 1,831.9 | |
Remaining Contract Terms [Member] | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Performance Obligation, Contract Term | one month to 24 years | |
2020 [Member] | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Amount | $ 257.2 | |
2021 [Member] | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Amount | 305.3 | |
2022 [Member] | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Amount | 230.9 | |
2023 [Member] | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Amount | 184.6 | |
Thereafter [Member] | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, Remaining Performance Obligation, Amount | $ 853.9 |
SEGMENTS (Details)
SEGMENTS (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Segment disclosure [Abstract] | |||
Revenues | $ 2,136,672 | $ 2,779,958 | |
Cost of sales and fuel (exclusive of depreciation and operating costs) | (1,276,928) | (1,956,377) | |
Operating costs | (207,040) | (240,741) | |
Equity in net earnings (loss) from investments | 44,627 | 43,481 | |
Depreciation and amortization | (132,353) | (114,158) | |
Impairment charges | (641,754) | 0 | |
Investments in unconsolidated affiliates | 810,479 | 950,924 | $ 861,844 |
Total assets | 21,969,440 | 18,934,325 | $ 21,812,121 |
Capital expenditures | 949,679 | 889,705 | |
Net income (loss) | (141,857) | 337,208 | |
Interest expense, net of capitalized interest | 140,616 | 115,420 | |
Income tax expense (benefit) | (55,395) | 77,934 | |
Noncash compensation expense | (1,302) | 5,540 | |
Other corporate costs and noncash items | (33,081) | (13,729) | |
Gain (loss) on extinguishment of debt | 15,800 | ||
Natural Gas Gathering And Processing [Member] | |||
Segment disclosure [Abstract] | |||
Revenues | 449,980 | 694,661 | |
Cost of sales and fuel (exclusive of depreciation and operating costs) | (202,170) | (450,913) | |
Operating costs | (84,470) | (94,247) | |
Equity in net earnings (loss) from investments | 806 | (1,202) | |
Noncash compensation expense and other | (4,498) | 3,945 | |
Segment adjusted EBITDA | 159,648 | 152,244 | |
Depreciation and amortization | (58,756) | (52,681) | |
Impairment charges | (564,353) | ||
Investments in unconsolidated affiliates | 4,276 | 39,749 | |
Total assets | 6,374,552 | 6,208,883 | |
Capital expenditures | 181,610 | 215,148 | |
Natural Gas Gathering And Processing [Member] | Natural Gas Gathering and Processing Intersegment [Member] | |||
Segment disclosure [Abstract] | |||
Revenues | 213,300 | 335,800 | |
Natural Gas Liquids | |||
Segment disclosure [Abstract] | |||
Revenues | 1,770,592 | 2,311,500 | |
Cost of sales and fuel (exclusive of depreciation and operating costs) | (1,278,754) | (1,846,673) | |
Operating costs | (89,571) | (110,438) | |
Equity in net earnings (loss) from investments | 15,268 | 17,544 | |
Noncash compensation expense and other | (6,619) | 5,706 | |
Segment adjusted EBITDA | 410,916 | 377,639 | |
Depreciation and amortization | (57,841) | (46,401) | |
Impairment charges | (77,401) | ||
Investments in unconsolidated affiliates | 435,024 | 447,272 | |
Total assets | 12,682,807 | 10,220,412 | |
Capital expenditures | 746,183 | 639,338 | |
Natural Gas Liquids | Natural Gas Liquids Regulated [Member] | |||
Segment disclosure [Abstract] | |||
Revenues | 435,100 | 323,100 | |
Cost of sales and fuel (exclusive of depreciation and operating costs) | (120,400) | (118,500) | |
Natural Gas Pipelines | |||
Segment disclosure [Abstract] | |||
Revenues | 120,783 | 116,400 | |
Cost of sales and fuel (exclusive of depreciation and operating costs) | (1,539) | (1,755) | |
Operating costs | (33,307) | (36,268) | |
Equity in net earnings (loss) from investments | 28,553 | 27,139 | |
Noncash compensation expense and other | (1,966) | 1,132 | |
Segment adjusted EBITDA | 112,524 | 106,648 | |
Depreciation and amortization | (14,769) | (14,156) | |
Impairment charges | 0 | ||
Investments in unconsolidated affiliates | 371,179 | 463,903 | |
Total assets | 2,089,362 | 2,138,759 | |
Capital expenditures | 16,590 | 28,688 | |
Natural Gas Pipelines | Natural Gas Pipelines Regulated [Member] | |||
Segment disclosure [Abstract] | |||
Revenues | 73,900 | 70,100 | |
Cost of sales and fuel (exclusive of depreciation and operating costs) | (6,100) | (5,600) | |
Total Segments [Member] | |||
Segment disclosure [Abstract] | |||
Revenues | 2,341,355 | 3,122,561 | |
Cost of sales and fuel (exclusive of depreciation and operating costs) | (1,482,463) | (2,299,341) | |
Operating costs | (207,348) | (240,953) | |
Equity in net earnings (loss) from investments | 44,627 | 43,481 | |
Noncash compensation expense and other | (13,083) | 10,783 | |
Segment adjusted EBITDA | 683,088 | 636,531 | |
Depreciation and amortization | (131,366) | (113,238) | |
Impairment charges | (641,754) | ||
Investments in unconsolidated affiliates | 810,479 | 950,924 | |
Total assets | 21,146,721 | 18,568,054 | |
Capital expenditures | 944,383 | 883,174 | |
Other and Eliminations | |||
Segment disclosure [Abstract] | |||
Revenues | (204,683) | (342,603) | |
Cost of sales and fuel (exclusive of depreciation and operating costs) | 205,535 | 342,964 | |
Operating costs | 308 | 212 | |
Equity in net earnings (loss) from investments | 0 | 0 | |
Depreciation and amortization | (987) | (920) | |
Impairment charges | 0 | ||
Investments in unconsolidated affiliates | 0 | 0 | |
Total assets | 822,719 | 366,271 | |
Capital expenditures | 5,296 | 6,531 | |
Operating Segments [Member] | Natural Gas Liquids | Natural Gas Liquids Regulated [Member] | |||
Segment disclosure [Abstract] | |||
Revenues | 378,200 | 270,000 | |
Noncustomer [Domain] | |||
Segment disclosure [Abstract] | |||
Revenues | 80,200 | 22,300 | |
NGL and Condensate Sales [Member] | |||
Segment disclosure [Abstract] | |||
Revenues | 1,617,156 | 2,152,084 | |
NGL and Condensate Sales [Member] | Natural Gas Gathering And Processing [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 219,917 | 332,332 | |
NGL and Condensate Sales [Member] | Natural Gas Liquids | |||
Segment Reporting Information [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 1,596,711 | 2,158,103 | |
NGL and Condensate Sales [Member] | Natural Gas Pipelines | |||
Segment Reporting Information [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 0 | 0 | |
NGL and Condensate Sales [Member] | Total Segments [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 1,816,628 | 2,490,435 | |
NGL and Condensate Sales [Member] | Other and Eliminations | |||
Segment disclosure [Abstract] | |||
Revenues | (199,472) | (338,351) | |
Residue Natural Gas Sales [Member] | |||
Segment disclosure [Abstract] | |||
Revenues | 190,054 | 320,006 | |
Residue Natural Gas Sales [Member] | Natural Gas Gathering And Processing [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 189,051 | 319,036 | |
Residue Natural Gas Sales [Member] | Natural Gas Liquids | |||
Segment Reporting Information [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 0 | 0 | |
Residue Natural Gas Sales [Member] | Natural Gas Pipelines | |||
Segment Reporting Information [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 2,035 | 970 | |
Residue Natural Gas Sales [Member] | Total Segments [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 191,086 | 320,006 | |
Residue Natural Gas Sales [Member] | Other and Eliminations | |||
Segment disclosure [Abstract] | |||
Revenues | (1,032) | 0 | |
Gathering, Processing and Exchange Services Revenue | |||
Segment disclosure [Abstract] | |||
Revenues | 158,473 | 138,276 | |
Gathering, Processing and Exchange Services Revenue | Natural Gas Gathering And Processing [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 37,937 | 39,742 | |
Gathering, Processing and Exchange Services Revenue | Natural Gas Liquids | |||
Segment Reporting Information [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 120,536 | 98,534 | |
Gathering, Processing and Exchange Services Revenue | Natural Gas Pipelines | |||
Segment Reporting Information [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 0 | 0 | |
Gathering, Processing and Exchange Services Revenue | Total Segments [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 158,473 | 138,276 | |
Gathering, Processing and Exchange Services Revenue | Other and Eliminations | |||
Segment disclosure [Abstract] | |||
Revenues | 0 | 0 | |
Transportation and Storage Revenue [Member] | |||
Segment disclosure [Abstract] | |||
Revenues | 165,310 | 161,250 | |
Transportation and Storage Revenue [Member] | Natural Gas Gathering And Processing [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 0 | 0 | |
Transportation and Storage Revenue [Member] | Natural Gas Liquids | |||
Segment Reporting Information [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 50,755 | 52,322 | |
Transportation and Storage Revenue [Member] | Natural Gas Pipelines | |||
Segment Reporting Information [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 118,364 | 112,865 | |
Transportation and Storage Revenue [Member] | Total Segments [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 169,119 | 165,187 | |
Transportation and Storage Revenue [Member] | Other and Eliminations | |||
Segment disclosure [Abstract] | |||
Revenues | (3,809) | (3,937) | |
Other [Member] | |||
Segment disclosure [Abstract] | |||
Revenues | 5,679 | 8,342 | |
Other [Member] | Natural Gas Gathering And Processing [Member] | |||
Segment disclosure [Abstract] | |||
Revenues | 3,075 | 3,551 | |
Other [Member] | Natural Gas Liquids | |||
Segment disclosure [Abstract] | |||
Revenues | 2,590 | 2,541 | |
Other [Member] | Natural Gas Pipelines | |||
Segment disclosure [Abstract] | |||
Revenues | 384 | 2,565 | |
Other [Member] | Total Segments [Member] | |||
Segment disclosure [Abstract] | |||
Revenues | 6,049 | 8,657 | |
Other [Member] | Other and Eliminations | |||
Segment disclosure [Abstract] | |||
Revenues | $ (370) | $ (315) |