Document and Entity Information
Document and Entity Information | 3 Months Ended |
Mar. 31, 2019shares | |
Document and Entity Information [Abstract] | |
Entity Registrant Name | Phillips 66 Partners LP |
Entity Central Index Key | 0001572910 |
Trading Symbol | PSXP |
Current Fiscal Year End Date | --12-31 |
Entity Filer Category | Large Accelerated Filer |
Document Type | 10-Q |
Document Period End Date | Mar. 31, 2019 |
Document Fiscal Year Focus | 2019 |
Document Fiscal Period Focus | Q1 |
Amendment Flag | false |
Entity Common Stock, Shares Outstanding | 124,726,087 |
Entity Emerging Growth Company | false |
Entity Small Business | false |
Consolidated Statement of Incom
Consolidated Statement of Income - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Revenues and Other Income | ||
Operating revenues | $ 302 | $ 256 |
Equity in earnings of affiliates | 119 | 98 |
Other income | 2 | 1 |
Total revenues and other income | 423 | 355 |
Costs and Expenses | ||
Operating and maintenance expenses | 139 | 97 |
Depreciation | 29 | 28 |
General and administrative expenses | 18 | 16 |
Taxes other than income taxes | 11 | 10 |
Interest and debt expense | 27 | 30 |
Total costs and expenses | 224 | 181 |
Income before income taxes | 199 | 174 |
Income tax expense | 1 | 2 |
Net Income | 198 | 172 |
Less: Preferred unitholders’ interest in net income | 10 | 9 |
Less: General partner’s interest in net income | 69 | 53 |
Limited partners’ interest in net income | $ 119 | $ 110 |
Common Units | ||
Net Income Attributable to the Partnership Per Limited Partner Unit | ||
Common units—basic (in dollars per share) | $ 0.96 | $ 0.91 |
Common units—diluted (in dollars per share) | $ 0.92 | $ 0.87 |
Weighted-Average Limited Partner Units Outstanding | ||
Common units—basic (in shares) | 124,257,933 | 121,609,520 |
Common units—diluted (in shares) | 138,078,000 | 135,429,000 |
Service revenues | ||
Revenues and Other Income | ||
Operating revenues | $ 45 | $ 112 |
Affiliated Entity | Service revenues | ||
Revenues and Other Income | ||
Operating revenues | 296 | 249 |
Third Party | Service revenues | ||
Revenues and Other Income | ||
Operating revenues | $ 6 | $ 7 |
Consolidated Statement of Compr
Consolidated Statement of Comprehensive Income - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Statement of Comprehensive Income [Abstract] | ||
Net Income | $ 198 | $ 172 |
Defined benefit plans | ||
Plan sponsored by equity affiliates, net of income taxes | 0 | 0 |
Other comprehensive income | 0 | 0 |
Comprehensive Income | $ 198 | $ 172 |
Consolidated Balance Sheet
Consolidated Balance Sheet - USD ($) $ in Millions | Mar. 31, 2019 | Dec. 31, 2018 |
Assets | ||
Cash and cash equivalents | $ 2 | $ 1 |
Accounts receivable—third parties | 90 | 95 |
Materials and supplies | 13 | 13 |
Prepaid expenses and other current assets | 11 | 20 |
Total current assets | 116 | 129 |
Equity investments | 2,897 | 2,448 |
Net properties, plants and equipment | 3,104 | 3,052 |
Goodwill | 185 | 185 |
Other assets | 51 | 5 |
Total Assets | 6,353 | 5,819 |
Liabilities | ||
Accounts payable—related parties | 21 | 22 |
Accounts payable—third parties | 82 | 88 |
Accrued interest | 32 | 36 |
Deferred revenues | 22 | 60 |
Short-term debt | 15 | 50 |
Accrued property and other taxes | 13 | 9 |
Other current liabilities | 3 | 5 |
Total current liabilities | 188 | 270 |
Long-term debt | 3,173 | 2,998 |
Obligation from equity interest transfer | 341 | 0 |
Other liabilities | 97 | 42 |
Total Liabilities | 3,799 | 3,310 |
Equity | ||
General partner—Phillips 66 (2019 and 2018—2,480,051 units issued and outstanding) | (1,315) | (1,313) |
Accumulated other comprehensive loss | (1) | (1) |
Total Equity | 2,554 | 2,509 |
Total Liabilities and Equity | 6,353 | 5,819 |
Public | Preferred Units | ||
Equity | ||
Preferred unitholders (2019 and 2018—13,819,791 units issued and outstanding) | 747 | 746 |
Total Equity | 747 | 746 |
Public | Common Units | ||
Equity | ||
Unitholders | 2,523 | 2,485 |
Total Equity | 2,523 | 2,485 |
Non-public | Common Units | Phillips 66 | ||
Equity | ||
Unitholders | 600 | 592 |
Total Equity | 600 | 592 |
Affiliated Entity | ||
Assets | ||
Accounts receivable—related parties | 87 | 90 |
Third Party | ||
Assets | ||
Accounts receivable—third parties | $ 3 | $ 5 |
Consolidated Balance Sheet (Par
Consolidated Balance Sheet (Parenthetical) - shares | Mar. 31, 2019 | Dec. 31, 2018 |
General partner—Phillips 66 units issued (in shares) | 2,480,051 | 2,480,051 |
General partner—Phillips 66 units outstanding (in shares) | 2,480,051 | |
Public | ||
Preferred units, issued (in shares) | 13,819,791 | 13,819,791 |
Preferred units, outstanding (in shares) | 13,819,791 | |
Common Units | Public | ||
Units issued (in shares) | 55,965,950 | 55,343,918 |
Units outstanding (in shares) | 55,965,950 | 55,343,918 |
Common Units | Non-public | Phillips 66 | ||
Units issued (in shares) | 68,760,137 | 68,760,137 |
Units outstanding (in shares) | 68,760,137 |
Consolidated Statement of Cash
Consolidated Statement of Cash Flows - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Proceeds from Third Party, Financing Activities | $ 341 | $ 0 |
Cash Flows From Operating Activities | ||
Net income | 198 | 172 |
Adjustments to reconcile net income to net cash provided by operating activities | ||
Depreciation | 29 | 28 |
Undistributed equity earnings | 2 | (8) |
Other liabilities | 10 | (38) |
Working capital adjustments | ||
Accounts receivable | 4 | (5) |
Prepaid expenses and other current assets | 9 | (3) |
Accounts payable | (4) | (4) |
Accrued interest | (5) | (2) |
Deferred revenues | (40) | 29 |
Other accruals | 2 | 2 |
Net Cash Provided by Operating Activities | 205 | 171 |
Cash Flows From Investing Activities | ||
Cash capital expenditures and investments | (634) | (74) |
Return of investment from equity affiliates | 20 | 14 |
Proceeds from sale of equity interest | 81 | |
Net Cash Used in Investing Activities | (533) | (60) |
Cash Flows From Financing Activities | ||
Issuance of debt | 725 | 0 |
Repayment of debt | (585) | 0 |
Issuance of common units | 32 | 9 |
Other distributions to Phillips 66 | (4) | 0 |
Net Cash Provided by (Used in) Financing Activities | 329 | (129) |
Net Change in Cash and Cash Equivalents | 1 | (18) |
Cash and cash equivalents at beginning of period | 1 | 185 |
Cash and Cash Equivalents at End of Period | 2 | 167 |
Preferred Units | ||
Cash Flows From Financing Activities | ||
Quarterly distributions to unitholders | (9) | (9) |
Public | Common Units | ||
Cash Flows From Financing Activities | ||
Quarterly distributions to unitholders | (46) | (36) |
General Partner | ||
Cash Flows From Financing Activities | ||
Quarterly distributions to unitholders | (67) | (47) |
Phillips 66 | Non-public | Common Units | ||
Cash Flows From Financing Activities | ||
Quarterly distributions to unitholders | $ (58) | $ (46) |
Consolidated Statement of Chang
Consolidated Statement of Changes in Equity - USD ($) $ in Millions | Total | Accum. Other Comprehensive Loss | General Partner | Preferred Units | Preferred UnitsPublic | Common UnitsPublic | Common UnitsNon-publicPhillips 66 |
Beginning Balance at Dec. 31, 2017 | $ 2,161 | $ (1) | $ (1,345) | $ 746 | $ 2,274 | $ 487 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Issuance of common units | 9 | 9 | |||||
Net income | 172 | 53 | $ 9 | 48 | 62 | ||
Quarterly cash distributions to unitholders and General Partner | (138) | (47) | (9) | (36) | (46) | ||
Ending Balance at Mar. 31, 2018 | $ 2,234 | (1) | $ (1,338) | $ 746 | $ 2,308 | $ 519 | |
Beginning balance, Units (in shares) at Dec. 31, 2017 | 137,871,801 | 2,480,051 | 13,819,791 | 52,811,822 | 68,760,137 | ||
Units Outstanding [Roll Forward] | |||||||
Units issued in public equity offerings (in shares) | 188,815 | 188,815 | |||||
Ending balance, Units (in shares) at Mar. 31, 2018 | 138,060,616 | 2,480,051 | 13,819,791 | 53,000,637 | 68,760,137 | ||
Beginning Balance at Dec. 31, 2018 | $ 2,509 | (1) | $ (1,313) | $ 746 | $ 2,485 | $ 592 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Issuance of common units | 32 | 32 | |||||
Net income | 198 | 69 | 10 | 53 | 66 | ||
Quarterly cash distributions to unitholders and General Partner | (180) | (67) | (9) | (46) | (58) | ||
Other distributions to Phillips 66 | (4) | (4) | |||||
Ending Balance at Mar. 31, 2019 | $ 2,554 | $ (1) | $ (1,315) | $ 747 | $ 2,523 | $ 600 | |
Beginning balance, Units (in shares) at Dec. 31, 2018 | 140,403,897 | 2,480,051 | 13,819,791 | 55,343,918 | 68,760,137 | ||
Units Outstanding [Roll Forward] | |||||||
Units issued in public equity offerings (in shares) | 622,032 | 622,032 | |||||
Ending balance, Units (in shares) at Mar. 31, 2019 | 141,025,929 | 2,480,051 | 13,819,791 | 55,965,950 | 68,760,137 |
Consolidated Statement of Cha_2
Consolidated Statement of Changes in Equity Parenthetical - $ / shares | Mar. 31, 2019 | Mar. 31, 2018 |
Statement of Stockholders' Equity [Abstract] | ||
Distribution (in USD per share) | $ 0.835 | $ 0.678 |
Description of the Business
Description of the Business | 3 Months Ended |
Mar. 31, 2019 | |
Description of Business [Abstract] | |
Description of the Business | Note 1—Description of the Business Unless otherwise stated or the context otherwise indicates, all references to “Phillips 66 Partners,” “the Partnership,” “us,” “our,” “we,” or similar expressions refer to Phillips 66 Partners LP, including its consolidated subsidiaries. References to Phillips 66 may refer to Phillips 66 and/or its subsidiaries, depending on the context. References to our “General Partner” refer to Phillips 66 Partners GP LLC, and references to Phillips 66 PDI refer to Phillips 66 Project Development Inc., the Phillips 66 subsidiary that holds a limited partner interest in us and wholly owns our General Partner. We are a growth-oriented master limited partnership formed to own, operate, develop and acquire primarily fee-based midstream assets. Our operations consist of crude oil, refined petroleum products and natural gas liquids (NGL) transportation, terminaling, processing and storage assets. We conduct our operations through both wholly owned and joint venture operations. The majority of our wholly owned assets are associated with, and are integral to the operation of, nine of Phillips 66’s owned or joint venture refineries. We primarily generate revenue by providing fee-based transportation, terminaling, processing, storage and fractionation services to Phillips 66 and other customers. Our equity affiliates primarily generate revenue from transporting and terminaling crude oil, refined petroleum products and NGL. Since we do not own any of the crude oil, refined petroleum products and NGL we handle and do not engage in the trading of crude oil, refined petroleum products and NGL, we have limited direct exposure to risks associated with fluctuating commodity prices, although these risks indirectly influence our activities and results of operations over the long term. |
Interim Financial Information
Interim Financial Information | 3 Months Ended |
Mar. 31, 2019 | |
Interim Financial Information [Abstract] | |
Interim Financial Information | Note 2— Interim Financial Information The unaudited interim financial information presented in the financial statements included in this report is prepared in accordance with generally accepted accounting principles in the United States (GAAP) and includes all known accruals and adjustments necessary, in the opinion of management, for a fair presentation of our financial position, results of operations and cash flows for the periods presented. Unless otherwise specified, all such adjustments are of a normal and recurring nature. Certain notes and other information have been condensed or omitted from the interim financial statements included in this report. Therefore, these interim financial statements should be read in conjunction with the audited consolidated financial statements and notes included in our 2018 Annual Report on Form 10-K. The results of operations for the three months ended March 31, 2019 , are not necessarily indicative of the results to be expected for the full year. Certain prior period financial information has been recast to reflect the current year’s presentation. |
Changes in Accounting Principle
Changes in Accounting Principles | 3 Months Ended |
Mar. 31, 2019 | |
Changes in Accounting Principles [Abstract] | |
Changes in Accounting Principles | Note 3— Changes in Accounting Principles Effective January 1, 2019, we elected to adopt Financial Accounting Standards Board (FASB) Accounting Standards Update (ASU) 2016-13, “Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments,” which amends the impairment model to utilize an expected loss methodology in place of the incurred loss methodology for financial instruments and off-balance sheet credit exposures. The amendment requires entities to consider a broader range of information to estimate expected credit losses, which may result in earlier recognition of losses. The adoption of the ASU did not have a material impact on our consolidated financial statements. Effective January 1, 2019, we adopted ASU 2016-02, “Leases (Topic 842)” using the modified retrospective transition method. The new standard establishes a right-of-use (ROU) model that requires a lessee to record a ROU asset and corresponding lease liability on the consolidated balance sheet for all operating leases with terms longer than 12 months. Leases will continue to be classified as either finance or operating, with classification affecting the pattern of expense recognition in the consolidated income statement. We elected the package of practical expedients that allowed us to carry forward the determination of whether an arrangement contains a lease and lease classification, as well as our accounting for initial direct costs for existing contracts. We recorded a noncash cumulative effect adjustment to our opening consolidated balance sheet as of January 1, 2019, to record an aggregate operating lease ROU asset and a corresponding lease liability of $45 million . See Note 5—Lease Assets and Liabilities , for the new lease disclosures required by this ASU for lessees. Effective for periods after January 1, 2019, we elected to account for lease and service elements of contracts classified as leases on a combined basis under the provisions of ASU No. 2016-02, except for leases of processing-type assets, which contain non-ratable fees related to turnaround activity. For these types of leases, we continued to separate the lease and service elements based on relative standalone prices and applied the new lease standard to the lease element and the revenue standard to the service element. We recorded a noncash cumulative effect adjustment of $1 million to decrease our opening equity balance as of January 1, 2019. See Note 4—Operating Revenues , for additional impacts of adopting this ASU, including new lease disclosures required for lessors. |
Operating Revenues
Operating Revenues | 3 Months Ended |
Mar. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Operating Revenues | Note 4—Operating Revenues Operating revenues are primarily generated from long-term pipeline transportation, terminaling, storage, processing and fractionation lease and service agreements, mainly with Phillips 66. These agreements typically include escalation clauses to adjust transportation tariffs and terminaling and storage fees to reflect changes in price indices. In addition, most of these agreements contain renewal options, which typically require the mutual consent of both our customers and us. Total operating revenues disaggregated by asset type were as follows: Millions of Dollars Three Months Ended 2019 2018 Pipelines $ 109 102 Terminals 40 39 Storage, processing and other revenues 153 115 Total operating revenues $ 302 256 The majority of our agreements with Phillips 66 are considered operating leases under GAAP. For reporting periods prior to our adoption of the new lease accounting standard, ASU No. 2016-02, as of January 1, 2019, the lease and service elements included in these contracts were separated with the lease element recognized in accordance with the existing lease accounting standard and the service element recognized in accordance with the revenue accounting standard. Effective for periods after January 1, 2019, we elected to account for lease and service elements of contracts classified as leases on a combined basis under the provisions of ASU No. 2016-02, except for leases of processing-type assets, which contain non-ratable fees related to turnaround activity. For these types of leases, we continued to separate the lease and service elements based on relative standalone prices and applied the new lease standard to the lease element and the revenue standard to the service element. As a result of our change in accounting policy, our lease and service revenues, lease and service accounts receivable and lease and service deferred revenues reported for the first quarter of 2019 are not prepared on the same basis as the amounts reported for the first quarter of 2018. Total operating revenues disaggregated by lease and service revenues were as follows: Millions of Dollars Three Months Ended 2019 2018 Lease revenues $ 257 144 Service revenues 45 112 Total operating revenues $ 302 256 Accounts Receivable We bill our customers, mainly Phillips 66, under our lease and service contracts generally on a monthly basis. Total accounts receivable by revenue type was as follows: Millions of Dollars March 31 2019 December 31 2018 Lease receivables $ 72 53 Service receivables 17 41 Other receivables 1 1 Total accounts receivables $ 90 95 Deferred Revenues Our deferred revenues represent payments received from our customers, mainly Phillips 66, in advance of the period in which lease and service contract performance obligations have been fulfilled. The majority of our deferred revenues relate to a tolling agreement and a storage agreement that are classified as leases. The remainder of our deferred revenues relate to lease and service agreements that contain minimum volume commitments with recovery provisions. Our deferred revenues are recorded in the “Deferred revenues” and “Other liabilities” lines on our consolidated balance sheet. Total deferred revenues under our lease and service agreements were as follows: Millions of Dollars March 31 2019 December 31 2018 Deferred lease revenues $ 48 73 Deferred service revenues 1 6 Total deferred revenues $ 49 79 Future Minimum Lease Payments from Customers At March 31, 2019, future minimum payments to be received under our lease agreements with customers were estimated to be: Millions of Dollars Remainder of 2019 $ 506 2020 644 2021 639 2022 627 2023 585 Remaining years 1,559 Total future minimum lease payments from customers $ 4,560 Remaining Service Performance Obligations We typically have long-term service contracts with our customers, of which the original durations range from 5 to 15 years. The weighted-average remaining duration of these contracts is 11 years. These contracts include both fixed and variable transaction price components. At March 31, 2019 , future service revenues expected to be recognized for the fixed component of the transaction price of our remaining performance obligations from service contracts with our customers that have an original expected duration of greater than one year were: Millions of Dollars Remainder of 2019 $ 107 2020 139 2021 131 2022 130 2023 130 Remaining years 742 Total future service revenues $ 1,379 For the remaining service performance obligations, we applied the exemption for variable prices allocated entirely to a wholly unsatisfied performance obligation or to a wholly unsatisfied promise to transfer distinct services as part of a performance obligation. |
Lease Assets and Liabilities
Lease Assets and Liabilities | 3 Months Ended |
Mar. 31, 2019 | |
Leases [Abstract] | |
Lease Assets and Liabilities | Note 5—Lease Assets and Liabilities We have agreements with Phillips 66 to lease land underlying or associated with certain of our assets that are classified as operating leases. Due to the economic infeasibility of canceling these leases, we consider them non-cancellable. Certain leases include escalation clauses for adjusting rental payments to reflect changes in price indices. There are no significant restrictions imposed on us in our lease agreements with regards to distribution payments, asset dispositions or borrowing ability. Effective with our implementation of ASU No. 2016-02, we elected to discount lease obligations using our incremental borrowing rate. For all leases, we elected the practical expedient to not separate service and lease costs. Our right-of-way agreements in effect prior to January 1, 2019, were not accounted for as leases as they were not initially determined to be leases at their commencement dates. However, modifications to these agreements or new agreements will be assessed and accounted for accordingly under ASU No. 2016-02. For short-term leases, which are leases that, at the commencement date, have a lease term of 12 months or less and do not include an option to purchase the underlying asset that is reasonably certain to exercise, we elected to not recognize the ROU asset and corresponding lease liability on our consolidated balance sheet. Operating lease ROU assets are recorded in the “Other assets” line and lease liabilities are recorded in the “Other current liabilities” and “Other liabilities” lines on our consolidated balance sheet. At March 31, 2019, the total operating lease ROU asset was $45 million . Future minimum lease payments and recorded short- and long-term lease liabilities at March 31, 2019, for operating leases were: Millions of Dollars Remainder of 2019 $ 2 2020 3 2021 3 2022 3 2023 3 Remaining years 91 Future minimum lease payments 105 Amount representing interest or discounts (60 ) Total lease liabilities 45 Short-term lease liabilities (1 ) Long-term lease liabilities $ 44 Operating lease costs and operating cash outflows for the three months ended March 31, 2019 , were $1 million . The weighted-average remaining lease term for our operating leases as of March 31, 2019 , was 36 years. The weighted-average discount rate for our operating leases as of March 31, 2019 , was 5.7% . |
Lease Assets and Liabilities | We have agreements with Phillips 66 to lease land underlying or associated with certain of our assets that are classified as operating leases. Due to the economic infeasibility of canceling these leases, we consider them non-cancellable. Certain leases include escalation clauses for adjusting rental payments to reflect changes in price indices. There are no significant restrictions imposed on us in our lease agreements with regards to distribution payments, asset dispositions or borrowing ability. Effective with our implementation of ASU No. 2016-02, we elected to discount lease obligations using our incremental borrowing rate. For all leases, we elected the practical expedient to not separate service and lease costs. Our right-of-way agreements in effect prior to January 1, 2019, were not accounted for as leases as they were not initially determined to be leases at their commencement dates. However, modifications to these agreements or new agreements will be assessed and accounted for accordingly under ASU No. 2016-02. For short-term leases, which are leases that, at the commencement date, have a lease term of 12 months or less and do not include an option to purchase the underlying asset that is reasonably certain to exercise, we elected to not recognize the ROU asset and corresponding lease liability on our consolidated balance sheet. Operating lease ROU assets are recorded in the “Other assets” line and lease liabilities are recorded in the “Other current liabilities” and “Other liabilities” lines on our consolidated balance sheet. At March 31, 2019, the total operating lease ROU asset was $45 million . Future minimum lease payments and recorded short- and long-term lease liabilities at March 31, 2019, for operating leases were: Millions of Dollars Remainder of 2019 $ 2 2020 3 2021 3 2022 3 2023 3 Remaining years 91 Future minimum lease payments 105 Amount representing interest or discounts (60 ) Total lease liabilities 45 Short-term lease liabilities (1 ) Long-term lease liabilities $ 44 Operating lease costs and operating cash outflows for the three months ended March 31, 2019 , were $1 million . The weighted-average remaining lease term for our operating leases as of March 31, 2019 , was 36 years. The weighted-average discount rate for our operating leases as of March 31, 2019 , was 5.7% . |
Equity Investments and Loans
Equity Investments and Loans | 3 Months Ended |
Mar. 31, 2019 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity Investments and Loans | Note 6—Equity Investments and Loans Equity Investments The following table summarizes the carrying value of our equity investments: Millions of Dollars Percentage Ownership March 31 December 31 Dakota Access, LLC and Energy Transfer Crude Oil Company, LLC (Bakken Pipeline) 25.00 % $ 597 608 Bayou Bridge Pipeline, LLC (Bayou Bridge) 40.00 286 277 DCP Sand Hills Pipeline, LLC (Sand Hills) 33.34 601 601 DCP Southern Hills Pipeline, LLC (Southern Hills) 33.34 209 206 Explorer Pipeline Company (Explorer) 21.94 110 115 Gray Oak Pipeline, LLC (Gray Oak) 65.00 741 288 Paradigm Pipeline LLC (Paradigm) 50.00 144 145 Phillips 66 Partners Terminal LLC (Phillips 66 Partners Terminal) 70.00 71 71 South Texas Gateway Terminal LLC (South Texas Gateway Terminal) 25.00 24 20 STACK Pipeline LLC (STACK) 50.00 114 117 Total equity investments $ 2,897 2,448 Earnings from our equity investments were as follows: Millions of Dollars Three Months Ended 2019 2018 Bakken Pipeline $ 51 32 Bayou Bridge 4 5 Sand Hills 36 25 Southern Hills 13 7 Explorer 3 16 Gray Oak — — Paradigm 3 2 Phillips 66 Partners Terminal 6 9 South Texas Gateway Terminal — — STACK 3 2 Total equity in earnings of affiliates $ 119 98 Gray Oak In April 2018, we entered into a Purchase and Sale Agreement with Phillips 66 PDI to acquire its 100% interest in Gray Oak Holdings LLC (Holdings LLC), a limited liability company that, at that time, owned a 100% interest in Gray Oak. Gray Oak is developing and constructing the Gray Oak Pipeline system which, upon completion, will provide crude oil transportation from the Permian and Eagle Ford to destinations in Corpus Christi, Texas, and the Sweeny, Texas, area, including the Phillips 66 Sweeny Refinery. The pipeline system is anticipated to be in service by the end of 2019. We accounted for the acquisition of Holdings LLC as an acquisition of assets under common control accounting. Also in April 2018, a co-venturer acquired a 25% interest in Gray Oak, along with sufficient voting rights over key governance provisions such that we no longer could assert control over Gray Oak. As a result, we (through our consolidated subsidiary Holdings LLC) began using the equity method of accounting for our investment in Gray Oak at that time. In December 2018, a third party exercised its option to acquire a 35% interest in Holdings LLC. Because Holdings LLC’s sole asset was its 75% ownership interest in Gray Oak, which is considered a financial asset, and because certain restrictions were placed on the third party’s ability to transfer or sell its interest in Holdings LLC during the construction of the Gray Oak Pipeline, the legal sale of the 35% interest did not qualify as a sale under GAAP. Rather, the third party’s cash contributions to Holdings LLC in 2019 to fund its share of previously incurred and future construction costs plus a premium to us are reflected as a long-term obligation in the “Obligation from equity interest transfer” line on our consolidated balance sheet and financing cash inflows in the “Proceeds from equity interest transfer” line on our consolidated statement of cash flows. After construction of the Gray Oak Pipeline is completed, these restrictions expire, and the sale will be recognized under GAAP. We will continue to control and consolidate Holdings LLC after sale recognition, and therefore the third party’s 35% interest will be recharacterized from a long-term obligation to a noncontrolling interest on our consolidated balance sheet at that time. Also at that time, the premium paid will be recharacterized from a long-term obligation to a gain in our consolidated statement of income. During the three months ended March 31, 2019, the third party contributed an aggregate of $341 million into Holdings LLC, which Holdings LLC used to fund its portion of Gray Oak’s cash calls. In February 2019, Holdings LLC transferred a 10% interest in Gray Oak to a third party that exercised a purchase option for proceeds of $81 million . This transfer was accounted for as a sale and resulted in a decrease in Holdings LLC’s ownership interest in Gray Oak from 75% to 65% and the recognition of an immaterial gain. The proceeds received from this sale are reflected as an investing cash inflow in the “Proceeds from sale of equity interest” line on our consolidated statement of cash flows. At March 31, 2019, our effective ownership interest in the Gray Oak Pipeline system was 42.25% . Gray Oak is considered a variable interest entity because it does not have sufficient equity at risk to fully fund the construction of all assets required for principal operations. We have determined we are not the primary beneficiary because we and our co-venturers jointly direct the activities of Gray Oak that most significantly impact economic performance. At March 31, 2019 , our maximum exposure to loss was $771 million , which represented guaranteed purchase obligations of $30 million and the aggregate book value of our equity method investment in Gray Oak of $741 million . Bakken Pipeline In March 2019, a wholly owned subsidiary of Dakota Access, LLC (Dakota Access) closed on an offering of $2,500 million aggregate principal amount of unsecured senior notes. The net proceeds from the issuance of these notes were used to repay amounts outstanding under existing credit facilities of Dakota Access and Energy Transfer Crude Oil Company, LLC (ETCO). Dakota Access and ETCO have guaranteed repayment of the notes. In addition, we and our co-venturers provided a Contingent Equity Contribution Undertaking (CECU) in conjunction with the notes offering. Under the CECU, if Dakota Access receives an unfavorable court ruling related to certain disputed construction permits and Dakota Access determines that an equity contribution trigger event has occurred, the venturers may be severally required to make proportionate equity contributions to Dakota Access and ETCO up to an aggregate maximum of approximately $2,525 million . Our share of the maximum potential equity contributions under the CECU is approximately $631 million . Related Party Loan On March 29, 2019, we and our co-venturers executed an agreement to loan Gray Oak up to a maximum of $1,230 million to finance construction of the Gray Oak Pipeline. The amount loaned by each venturer is expected to be proportionate to its effective ownership interest. The maximum amount to be loaned by us is $520 million . Loans under this agreement are due on March 31, 2022, with early repayment permitted. On April 1, 2019, we and our co-venturers loaned Gray Oak a total of $125 million under this agreement, of which our share was $53 million . |
Net Income Per Limited Partner
Net Income Per Limited Partner Unit | 3 Months Ended |
Mar. 31, 2019 | |
Partners' Capital Notes [Abstract] | |
Net Income Per Limited Partner Unit | Note 7—Net Income Per Limited Partner Unit Net income per limited partner unit applicable to common units is computed by dividing the limited partners’ interest in net income by the weighted-average number of common units outstanding for the period. Because we have more than one class of participating securities, we use the two-class method to calculate the net income per unit applicable to the limited partners. As of March 31, 2019 , the classes of participating securities included common units, general partner units and incentive distribution rights (IDRs). For the three months ended March 31, 2019 and 2018 , our preferred units are potentially dilutive securities and were dilutive to net income per limited partner unit. Net income earned by the Partnership is allocated between the limited partners and the General Partner (including the General Partner’s IDRs) in accordance with our partnership agreement, after giving effect to priority income allocations to the holders of the preferred units. First, earnings are allocated based on actual cash distributions declared to our unitholders, including those attributable to the General Partner’s IDRs. To the extent net income exceeds or is less than cash distributions, this difference is allocated based on the unitholders’ respective ownership percentages, after consideration of any priority allocations of earnings. For the diluted net income per limited partner unit calculation, the preferred units are assumed to be converted at the beginning of the period into common limited partner units on a one-for-one basis, and the distribution formula for available cash in our partnership agreement is recalculated, using the original available cash amount increased only for the preferred distributions which would not have been paid after conversion. Millions of Dollars Three Months Ended 2019 2018 Net income $ 198 172 Less: General partner’s distributions declared (including IDRs)* 69 51 Limited partners’ distributions declared on preferred units* 10 9 Limited partners’ distributions declared on common units* 105 88 Distributions less than net income $ 14 24 *Distributions declared attributable to the indicated periods. Limited Partners’ Common Units General Partner (including IDRs) Limited Partners’ Preferred Units Total Three Months Ended March 31, 2019 Net income (millions) : Distributions declared $ 105 69 10 184 Distributions less than net income 14 — — 14 Net income (basic) 119 69 10 198 Dilutive effect of preferred units* 8 Net income (diluted) $ 127 Weighted-average units outstanding—basic 124,257,933 Dilutive effect of preferred units* 13,819,791 Weighted-average units outstanding—diluted 138,077,724 Net income per limited partner unit—basic (dollars) $ 0.96 Net income per limited partner unit—diluted (dollars) 0.92 *The dilutive effect of preferred units assumes the reallocation of net income to the limited and general partners, including a reallocation associated with IDRs, pursuant to the available cash formula in the partnership agreement. Limited Partners’ General Partner Limited Partners’ Total Three Months Ended March 31, 2018 Net income (millions) : Distributions declared $ 88 51 9 148 Distributions less than net income 22 2 — 24 Net income (basic) 110 53 9 172 Dilutive effect of preferred units* 7 Net income (diluted) $ 117 Weighted-average units outstanding—basic 121,609,520 Dilutive effect of preferred units* 13,819,791 Weighted-average units outstanding—diluted 135,429,311 Net income per limited partner unit—basic (dollars) $ 0.91 Net income per limited partner unit—diluted (dollars) 0.87 *The dilutive effect of preferred units assumes the reallocation of net income to the limited and general partners, including a reallocation associated with IDRs, pursuant to the available cash formula in the partnership agreement. On April 17, 2019 , the Board of Directors of our General Partner declared a quarterly cash distribution of $0.845 per common unit attributable to the first quarter of 2019. This distribution is payable on May 14, 2019 , to unitholders of record as of April 30, 2019 . |
Properties, Plants and Equipmen
Properties, Plants and Equipment | 3 Months Ended |
Mar. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Properties, Plants and Equipment | Note 8—Properties, Plants and Equipment Our investment in properties, plants and equipment (PP&E), with the associated accumulated depreciation, was: Millions of Dollars March 31 December 31 Land $ 19 19 Buildings and improvements 91 89 Pipelines and related assets * 1,400 1,398 Terminals and related assets * 711 710 Rail racks and related assets * 137 137 Processing and related assets * 863 842 Caverns and related assets * 584 584 Construction-in-progress 271 216 Gross PP&E 4,076 3,995 Less: accumulated depreciation 972 943 Net PP&E $ 3,104 3,052 *Assets for which we are the lessor. |
Debt
Debt | 3 Months Ended |
Mar. 31, 2019 | |
Debt Disclosure [Abstract] | |
Debt | Note 9—Debt Millions of Dollars March 31 December 31 2.646% Senior Notes due February 2020 $ 300 300 3.605% Senior Notes due February 2025 500 500 3.550% Senior Notes due October 2026 500 500 3.750% Senior Notes due March 2028 500 500 4.680% Senior Notes due February 2045 450 450 4.900% Senior Notes due October 2046 625 625 Term loans due March 2020 at 3.491% at March 31, 2019 250 — Tax-exempt bonds due April 2020 and April 2021 at 1.655% and 1.885% at March 31, 2019, and December 31, 2018, respectively 75 75 Revolving credit facility due April 2019 at 3.680% and 3.669% at March 31, 2019, and December 31, 2018, respectively 15 125 Debt at face value 3,215 3,075 Net unamortized discounts and debt issuance costs (27 ) (27 ) Total debt 3,188 3,048 Short-term debt (15 ) (50 ) Long-term debt $ 3,173 2,998 On March 22, 2019, we entered into a senior unsecured term loan facility with a borrowing capacity of $400 million that matures on March 20, 2020. At March 31, 2019, term loans totaling $250 million were outstanding under this facility. Borrowings under this facility bear interest at a floating rate based on either the Eurodollar rate or the reference rate, plus a margin determined by our credit ratings. Proceeds from term loans made under this facility were used for general partnership purposes, including repayment of amounts borrowed under our $750 million revolving credit facility. On April 1, 2019, we borrowed an additional $120 million under this term loan facility. At March 31, 2019, $550 million of debt due within a year was classified as long-term debt based on our intent to refinance the obligation on a long-term basis and ability to do so under our revolving credit facility. The fair value of our fixed-rate and floating-rate debt is estimated based on observable market prices and is classified in level 2 of the fair value hierarchy. The fair value of our fixed-rate debt amounted to $2,847 million and $2,660 million at March 31, 2019 , and December 31, 2018 , respectively. The fair value of our floating-rate debt approximated carrying value of $340 million and $200 million at March 31, 2019 , and December 31, 2018 , respectively. |
Equity
Equity | 3 Months Ended |
Mar. 31, 2019 | |
Equity [Abstract] | |
Equity | Note 10—Equity ATM Programs Our initial $250 million continuous offering of common units, or at-the-market (ATM) program, was completed in June 2018. At that time, we commenced issuing common units under our second $250 million ATM program. For the three months ended March 31, 2019 , on a settlement date basis, we issued an aggregate of 622,032 common units under our ATM programs, generating net proceeds of $32 million . For the three months ended March 31, 2018 , we issued an aggregate of 188,815 common units under our ATM programs, generating net proceeds of $9 million . Since inception in June 2016 through March 31, 2019 , we issued an aggregate of 6,872,996 common units under our ATM programs, generating net proceeds of $352 million , after broker commissions of $4 million . The net proceeds from sales under the ATM programs are used for general partnership purposes, which may include debt repayment, acquisitions, capital expenditures and additions to working capital. |
Contingencies
Contingencies | 3 Months Ended |
Mar. 31, 2019 | |
Contingencies [Abstract] | |
Contingencies | Note 11—Contingencies From time to time, lawsuits involving a variety of claims that arise in the ordinary course of business are filed against us. We also may be required to remove or mitigate the effects on the environment of the placement, storage, disposal or release of certain chemical, mineral and petroleum substances at various sites. We regularly assess the need for accounting recognition or disclosure of these contingencies. In the case of all known contingencies (other than those related to income taxes), we accrue a liability when the loss is probable and the amount is reasonably estimable. If a range of amounts can be reasonably estimated and no amount within the range is a better estimate than any other amount, then the minimum of the range is accrued. We do not reduce these liabilities for potential insurance or third-party recoveries. If applicable, we accrue receivables for probable insurance or other third-party recoveries. In the case of income-tax-related contingencies, we use a cumulative probability-weighted loss accrual in cases where sustaining a tax position is less than certain. Based on currently available information, we believe it is remote that future costs related to known contingent liability exposures will exceed current accruals by an amount that would have a material adverse impact on our consolidated financial statements. As we learn new facts concerning contingencies, we reassess our position both with respect to accrued liabilities and other potential exposures. Estimates particularly sensitive to future changes include any contingent liabilities recorded for environmental remediation, tax and legal matters. Estimated future environmental remediation costs are subject to change due to such factors as the uncertain magnitude of cleanup costs, the unknown time and extent of such remedial actions that may be required, and the determination of our liability in proportion to that of other potentially responsible parties. Estimated future costs related to tax and legal matters are subject to change as events evolve and as additional information becomes available during the administrative and litigation processes. Environmental We are subject to federal, state and local environmental laws and regulations. We record accruals for contingent environmental liabilities based on management’s best estimates, using all information that is available at the time. We measure estimates and base liabilities on currently available facts, existing technology, and presently enacted laws and regulations, taking into account stakeholder and business considerations. When measuring environmental liabilities, we also consider our prior experience in remediation of contaminated sites, other companies’ cleanup experience, and data released by the U.S. Environmental Protection Agency or other organizations. We consider unasserted claims in our determination of environmental liabilities, and we accrue them in the period they are both probable and reasonably estimable. In the future, we may be involved in additional environmental assessments, cleanups and proceedings. Legal Proceedings Under our amended omnibus agreement, Phillips 66 provides certain services for our benefit, including legal support services, and we pay an operational and administrative support fee for these services. Phillips 66’s legal organization applies its knowledge, experience and professional judgment to the specific characteristics of our cases, employing a litigation management process to manage and monitor the legal proceedings against us. The process facilitates the early evaluation and quantification of potential exposures in individual cases and enables tracking of those cases that have been scheduled for trial and/or mediation. Based on professional judgment and experience in using these litigation management tools and available information about current developments in all our cases, Phillips 66’s legal organization regularly assesses the adequacy of current accruals and determines if adjustment of existing accruals, or establishment of new accruals, is required. As of March 31, 2019 , and December 31, 2018 , we did not have any material accrued contingent liabilities associated with litigation matters. Indemnification and Excluded Liabilities Under our amended omnibus agreement and pursuant to the terms of various agreements under which we acquired assets from Phillips 66, Phillips 66 will indemnify us, or assume responsibility, for certain environmental liabilities, tax liabilities, litigation and any other liabilities attributable to the ownership or operation of the assets contributed to us and that arose prior to the effective date of each acquisition. These indemnifications and exclusions from liability have, in some cases, time limits and deductibles. When Phillips 66 performs under any of these indemnifications or exclusions from liability, we recognize noncash expenses and associated noncash capital contributions from our General Partner, as these are considered liabilities paid for by a principal unitholder. |
Cash Flow Information
Cash Flow Information | 3 Months Ended |
Mar. 31, 2019 | |
Supplemental Cash Flow Information [Abstract] | |
Cash Flow Information | Note 12—Cash Flow Information Capital Expenditures and Investments Our capital expenditures and investments consisted of: Millions of Dollars Three Months Ended 2019 2018 Cash capital expenditures and investments $ 634 74 Change in capital expenditure accruals (2 ) (5 ) Total capital expenditures and investments $ 632 69 |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2019 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Note 13—Related Party Transactions Commercial Agreements We have entered into long-term, fee-based commercial agreements with Phillips 66 to provide transportation, terminaling, storage, stevedoring, fractionation, processing, and rail terminal services. Under these agreements, Phillips 66 commits to provide us with minimum transportation, throughput or storage volumes, or minimum monthly service fees. If Phillips 66 does not meet its minimum volume commitments, Phillips 66 pays us a deficiency payment based on the calculation described in the agreement. Amended and Restated Operational Services Agreement Under our amended and restated operational services agreement, we reimburse Phillips 66 for providing certain operational services to us in support of our pipelines, terminaling, processing, and storage facilities. These services include routine and emergency maintenance and repair services, routine operational activities, routine administrative services, construction and related services and such other services as we and Phillips 66 may mutually agree upon from time to time. Amended Omnibus Agreement The amended omnibus agreement addresses our payment of an operating and administrative support fee and our obligation to reimburse Phillips 66 for all other direct or allocated costs and expenses incurred by Phillips 66 in providing general and administrative services. Additionally, the omnibus agreement addresses Phillips 66’s indemnification to us and our indemnification to Phillips 66 for certain environmental and other liabilities. Further, it addresses the granting of a license from Phillips 66 to us with respect to the use of certain Phillips 66 trademarks. Tax Sharing Agreement Under our tax sharing agreement, we reimburse Phillips 66 for our share of state and local income and other taxes incurred by Phillips 66 due to our results of operations being included in a combined or consolidated tax return filed by Phillips 66. Any reimbursement is limited to the tax that we (and our subsidiaries) would have paid had we not been included in a combined group with Phillips 66. Phillips 66 may use its tax attributes to cause its combined or consolidated group to owe no tax; however, we would nevertheless reimburse Phillips 66 for the tax we would have owed, even though Phillips 66 had no cash expense for that period. Related Party Transactions Significant related party transactions included in our total costs and expenses were: Millions of Dollars Three Months Ended 2019 2018 Operating and maintenance expenses $ 105 65 General and administrative expenses 17 15 Total $ 122 80 We pay Phillips 66 a monthly operational and administrative support fee under the terms of our amended omnibus agreement in the amount of $8 million . The operational and administrative support fee is for the provision of certain services, including: logistical services; asset oversight, such as operational management and supervision; corporate engineering services, including asset integrity and regulatory services; business development services; executive services; financial and administrative services (including treasury and accounting); information technology; legal services; corporate health, safety and environmental services; facility services; human resources services; procurement services; investor relations; tax matters; and public company reporting services. We also reimburse Phillips 66 for all other direct or allocated costs incurred on behalf of us, pursuant to the terms of our amended omnibus agreement. The classification of these charges between operating and maintenance expenses and general and administrative expenses is based on the functional nature of the services performed for our operations. Under our amended and restated operational services agreement, we reimburse Phillips 66 for the provision of certain operational services to us in support of our operating assets. Additionally, we pay Phillips 66 for insurance services provided to us and recoveries under these policies are recorded as an offset to our expenses. Operating and maintenance expenses also include volumetric gains and losses associated with volumes transported by Phillips 66. Other related party balances were included in the following line items on our consolidated balance sheet, all of which were related to commercial agreements with Phillips 66: Millions of Dollars March 31 December 31 Prepaid expenses and other current assets $ 4 4 Other assets 45 — Deferred revenues 22 60 Other current liabilities 1 — Other liabilities 71 18 Equity Affiliate Guarantee In 2018, we guaranteed the payment of our portion of certain purchase obligations of Gray Oak. At March 31, 2019 , our maximum potential amount of future payments to third parties under the guarantee was estimated to be $30 million . Payment would be required if Gray Oak defaults on these obligations. |
Changes in Accounting Princip_2
Changes in Accounting Principles (Policies) | 3 Months Ended |
Mar. 31, 2019 | |
Changes in Accounting Principles [Abstract] | |
New Accounting Pronouncements | Changes in Accounting Principles Effective January 1, 2019, we elected to adopt Financial Accounting Standards Board (FASB) Accounting Standards Update (ASU) 2016-13, “Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments,” which amends the impairment model to utilize an expected loss methodology in place of the incurred loss methodology for financial instruments and off-balance sheet credit exposures. The amendment requires entities to consider a broader range of information to estimate expected credit losses, which may result in earlier recognition of losses. The adoption of the ASU did not have a material impact on our consolidated financial statements. Effective January 1, 2019, we adopted ASU 2016-02, “Leases (Topic 842)” using the modified retrospective transition method. The new standard establishes a right-of-use (ROU) model that requires a lessee to record a ROU asset and corresponding lease liability on the consolidated balance sheet for all operating leases with terms longer than 12 months. Leases will continue to be classified as either finance or operating, with classification affecting the pattern of expense recognition in the consolidated income statement. We elected the package of practical expedients that allowed us to carry forward the determination of whether an arrangement contains a lease and lease classification, as well as our accounting for initial direct costs for existing contracts. We recorded a noncash cumulative effect adjustment to our opening consolidated balance sheet as of January 1, 2019, to record an aggregate operating lease ROU asset and a corresponding lease liability of $45 million . See Note 5—Lease Assets and Liabilities , for the new lease disclosures required by this ASU for lessees. Effective for periods after January 1, 2019, we elected to account for lease and service elements of contracts classified as leases on a combined basis under the provisions of ASU No. 2016-02, except for leases of processing-type assets, which contain non-ratable fees related to turnaround activity. For these types of leases, we continued to separate the lease and service elements based on relative standalone prices and applied the new lease standard to the lease element and the revenue standard to the service element. We recorded a noncash cumulative effect adjustment of $1 million to decrease our opening equity balance as of January 1, 2019. See Note 4—Operating Revenues , for additional impacts of adopting this ASU, including new lease disclosures required for lessors. |
Earnings Per Share | Net income per limited partner unit applicable to common units is computed by dividing the limited partners’ interest in net income by the weighted-average number of common units outstanding for the period. Because we have more than one class of participating securities, we use the two-class method to calculate the net income per unit applicable to the limited partners. As of March 31, 2019 , the classes of participating securities included common units, general partner units and incentive distribution rights (IDRs). For the three months ended March 31, 2019 and 2018 , our preferred units are potentially dilutive securities and were dilutive to net income per limited partner unit. |
Operating Revenues (Tables)
Operating Revenues (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | Total operating revenues disaggregated by asset type were as follows: Millions of Dollars Three Months Ended 2019 2018 Pipelines $ 109 102 Terminals 40 39 Storage, processing and other revenues 153 115 Total operating revenues $ 302 256 Total operating revenues disaggregated by lease and service revenues were as follows: Millions of Dollars Three Months Ended 2019 2018 Lease revenues $ 257 144 Service revenues 45 112 Total operating revenues $ 302 256 |
Accounts Receivable | Total accounts receivable by revenue type was as follows: Millions of Dollars March 31 2019 December 31 2018 Lease receivables $ 72 53 Service receivables 17 41 Other receivables 1 1 Total accounts receivables $ 90 95 |
Deferred Revenues | Total deferred revenues under our lease and service agreements were as follows: Millions of Dollars March 31 2019 December 31 2018 Deferred lease revenues $ 48 73 Deferred service revenues 1 6 Total deferred revenues $ 49 79 |
Schedule of future minimum payments receivable | Future Minimum Lease Payments from Customers At March 31, 2019, future minimum payments to be received under our lease agreements with customers were estimated to be: Millions of Dollars Remainder of 2019 $ 506 2020 644 2021 639 2022 627 2023 585 Remaining years 1,559 Total future minimum lease payments from customers $ 4,560 |
Expected Timing of Satisfaction | At March 31, 2019 , future service revenues expected to be recognized for the fixed component of the transaction price of our remaining performance obligations from service contracts with our customers that have an original expected duration of greater than one year were: Millions of Dollars Remainder of 2019 $ 107 2020 139 2021 131 2022 130 2023 130 Remaining years 742 Total future service revenues $ 1,379 |
Lease Assets and Liabilities (T
Lease Assets and Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Leases [Abstract] | |
Operating lease, liability | Future minimum lease payments and recorded short- and long-term lease liabilities at March 31, 2019, for operating leases were: Millions of Dollars Remainder of 2019 $ 2 2020 3 2021 3 2022 3 2023 3 Remaining years 91 Future minimum lease payments 105 Amount representing interest or discounts (60 ) Total lease liabilities 45 Short-term lease liabilities (1 ) Long-term lease liabilities $ 44 |
Equity Investments and Loans (T
Equity Investments and Loans (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Schedule of Equity Investments | The following table summarizes the carrying value of our equity investments: Millions of Dollars Percentage Ownership March 31 December 31 Dakota Access, LLC and Energy Transfer Crude Oil Company, LLC (Bakken Pipeline) 25.00 % $ 597 608 Bayou Bridge Pipeline, LLC (Bayou Bridge) 40.00 286 277 DCP Sand Hills Pipeline, LLC (Sand Hills) 33.34 601 601 DCP Southern Hills Pipeline, LLC (Southern Hills) 33.34 209 206 Explorer Pipeline Company (Explorer) 21.94 110 115 Gray Oak Pipeline, LLC (Gray Oak) 65.00 741 288 Paradigm Pipeline LLC (Paradigm) 50.00 144 145 Phillips 66 Partners Terminal LLC (Phillips 66 Partners Terminal) 70.00 71 71 South Texas Gateway Terminal LLC (South Texas Gateway Terminal) 25.00 24 20 STACK Pipeline LLC (STACK) 50.00 114 117 Total equity investments $ 2,897 2,448 Earnings from our equity investments were as follows: Millions of Dollars Three Months Ended 2019 2018 Bakken Pipeline $ 51 32 Bayou Bridge 4 5 Sand Hills 36 25 Southern Hills 13 7 Explorer 3 16 Gray Oak — — Paradigm 3 2 Phillips 66 Partners Terminal 6 9 South Texas Gateway Terminal — — STACK 3 2 Total equity in earnings of affiliates $ 119 98 |
Net Income Per Limited Partne_2
Net Income Per Limited Partner Unit (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Partners' Capital Notes [Abstract] | |
Schedule of Distributions Declared, Partners Interest in Partnership Net Income and Net Income per Unit by Class | Millions of Dollars Three Months Ended 2019 2018 Net income $ 198 172 Less: General partner’s distributions declared (including IDRs)* 69 51 Limited partners’ distributions declared on preferred units* 10 9 Limited partners’ distributions declared on common units* 105 88 Distributions less than net income $ 14 24 *Distributions declared attributable to the indicated periods. Limited Partners’ Common Units General Partner (including IDRs) Limited Partners’ Preferred Units Total Three Months Ended March 31, 2019 Net income (millions) : Distributions declared $ 105 69 10 184 Distributions less than net income 14 — — 14 Net income (basic) 119 69 10 198 Dilutive effect of preferred units* 8 Net income (diluted) $ 127 Weighted-average units outstanding—basic 124,257,933 Dilutive effect of preferred units* 13,819,791 Weighted-average units outstanding—diluted 138,077,724 Net income per limited partner unit—basic (dollars) $ 0.96 Net income per limited partner unit—diluted (dollars) 0.92 *The dilutive effect of preferred units assumes the reallocation of net income to the limited and general partners, including a reallocation associated with IDRs, pursuant to the available cash formula in the partnership agreement. Limited Partners’ General Partner Limited Partners’ Total Three Months Ended March 31, 2018 Net income (millions) : Distributions declared $ 88 51 9 148 Distributions less than net income 22 2 — 24 Net income (basic) 110 53 9 172 Dilutive effect of preferred units* 7 Net income (diluted) $ 117 Weighted-average units outstanding—basic 121,609,520 Dilutive effect of preferred units* 13,819,791 Weighted-average units outstanding—diluted 135,429,311 Net income per limited partner unit—basic (dollars) $ 0.91 Net income per limited partner unit—diluted (dollars) 0.87 *The dilutive effect of preferred units assumes the reallocation of net income to the limited and general partners, including a reallocation associated with IDRs, pursuant to the available cash formula in the partnership agreement. |
Properties, Plants and Equipm_2
Properties, Plants and Equipment (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Summary of Property, Plant and Equipment | Our investment in properties, plants and equipment (PP&E), with the associated accumulated depreciation, was: Millions of Dollars March 31 December 31 Land $ 19 19 Buildings and improvements 91 89 Pipelines and related assets * 1,400 1,398 Terminals and related assets * 711 710 Rail racks and related assets * 137 137 Processing and related assets * 863 842 Caverns and related assets * 584 584 Construction-in-progress 271 216 Gross PP&E 4,076 3,995 Less: accumulated depreciation 972 943 Net PP&E $ 3,104 3,052 *Assets for which we are the lessor. |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | Millions of Dollars March 31 December 31 2.646% Senior Notes due February 2020 $ 300 300 3.605% Senior Notes due February 2025 500 500 3.550% Senior Notes due October 2026 500 500 3.750% Senior Notes due March 2028 500 500 4.680% Senior Notes due February 2045 450 450 4.900% Senior Notes due October 2046 625 625 Term loans due March 2020 at 3.491% at March 31, 2019 250 — Tax-exempt bonds due April 2020 and April 2021 at 1.655% and 1.885% at March 31, 2019, and December 31, 2018, respectively 75 75 Revolving credit facility due April 2019 at 3.680% and 3.669% at March 31, 2019, and December 31, 2018, respectively 15 125 Debt at face value 3,215 3,075 Net unamortized discounts and debt issuance costs (27 ) (27 ) Total debt 3,188 3,048 Short-term debt (15 ) (50 ) Long-term debt $ 3,173 2,998 |
Cash Flow Information (Tables)
Cash Flow Information (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Supplemental Cash Flow Information [Abstract] | |
Summary of Capital Expenditures and Noncash Investing and Financing Activities | Our capital expenditures and investments consisted of: Millions of Dollars Three Months Ended 2019 2018 Cash capital expenditures and investments $ 634 74 Change in capital expenditure accruals (2 ) (5 ) Total capital expenditures and investments $ 632 69 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Related Party Transactions [Abstract] | |
Summary of Related Party Transactions | Significant related party transactions included in our total costs and expenses were: Millions of Dollars Three Months Ended 2019 2018 Operating and maintenance expenses $ 105 65 General and administrative expenses 17 15 Total $ 122 80 Other related party balances were included in the following line items on our consolidated balance sheet, all of which were related to commercial agreements with Phillips 66: Millions of Dollars March 31 December 31 Prepaid expenses and other current assets $ 4 4 Other assets 45 — Deferred revenues 22 60 Other current liabilities 1 — Other liabilities 71 18 |
Description of the Business (De
Description of the Business (Details) | Mar. 31, 2019refinery |
Phillips 66 | |
Property, Plant and Equipment [Line Items] | |
Number of refineries | 9 |
Changes in Accounting Princip_3
Changes in Accounting Principles (Details) - USD ($) $ in Millions | Mar. 31, 2019 | Jan. 01, 2019 | Jan. 01, 2018 |
Item Effected [Line Items] | |||
ROU asset | $ 45 | $ 45 | |
Lease, liability | $ 45 | 45 | |
Cumulative effect of accounting change | (1) | $ 30 | |
Accounting Standards Update 2014-09 | |||
Item Effected [Line Items] | |||
Cumulative effect of accounting change | $ (1) |
Operating Revenues (Revenues Di
Operating Revenues (Revenues Disaggregated) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Operating revenues | $ 302 | $ 256 |
Pipelines | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Operating revenues | 109 | 102 |
Terminals | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Operating revenues | 40 | 39 |
Storage, processing and other revenues | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Operating revenues | $ 153 | $ 115 |
Operating Revenues (Narrative)
Operating Revenues (Narrative) (Details) | Mar. 31, 2019 | Mar. 31, 2019 |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Customer contracts, average remaining duration | 11 years | |
Minimum | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Customer contracts, term | 5 years | |
Maximum | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Customer contracts, term | 15 years |
Operating Revenues (Operating R
Operating Revenues (Operating Revenues) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Operating revenues | $ 302 | $ 256 |
Lease revenues | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Operating revenues | 257 | 144 |
Service revenues | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Operating revenues | $ 45 | $ 112 |
Operating Revenues (Accounts Re
Operating Revenues (Accounts Receivable) (Details) - USD ($) $ in Millions | Mar. 31, 2019 | Dec. 31, 2018 |
Revenue from External Customer [Line Items] | ||
Accounts receivable—third parties | $ 90 | $ 95 |
Lease receivables | ||
Revenue from External Customer [Line Items] | ||
Accounts receivable—third parties | 72 | 53 |
Service revenues | ||
Revenue from External Customer [Line Items] | ||
Accounts receivable—third parties | 17 | 41 |
Other receivables | ||
Revenue from External Customer [Line Items] | ||
Accounts receivable—third parties | $ 1 | $ 1 |
Operating Revenues (Deferred Re
Operating Revenues (Deferred Revenue) (Details) - USD ($) $ in Millions | Mar. 31, 2019 | Dec. 31, 2018 |
Revenue from External Customer [Line Items] | ||
Total deferred revenues | $ 49 | $ 79 |
Lease revenues | ||
Revenue from External Customer [Line Items] | ||
Total deferred revenues | 48 | 73 |
Service revenues | ||
Revenue from External Customer [Line Items] | ||
Total deferred revenues | $ 1 | $ 6 |
Operating Revenues (Schedule of
Operating Revenues (Schedule of Future Minimum Operating Lease Income) (Details) $ in Millions | Mar. 31, 2019USD ($) |
Revenue from Contract with Customer [Abstract] | |
Remainder of 2019 | $ 506 |
2020 | 644 |
2021 | 639 |
2022 | 627 |
2023 | 585 |
Remaining years | 1,559 |
Total future minimum lease payments from customers | $ 4,560 |
Operating Revenues (Performance
Operating Revenues (Performance Obligations) (Details) $ in Millions | Mar. 31, 2019USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-04-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation, amount | $ 107 |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 9 months |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation, amount | $ 139 |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation, amount | $ 131 |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation, amount | $ 130 |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation, amount | $ 130 |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation, amount | $ 1,379 |
Revenue, remaining performance obligation, expected timing of satisfaction, period |
Lease Assets and Liabilities (N
Lease Assets and Liabilities (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2019 | Jan. 01, 2019 | |
Leases [Abstract] | ||
ROU asset | $ 45 | $ 45 |
Operating lease cost | $ 1 | |
Weighted Average remaining lease term | 36 years | |
Weighted average discount rate | 5.70% |
Lease Assets and Liabilities (F
Lease Assets and Liabilities (Future Minimum Lease Payments) (Details) - USD ($) $ in Millions | Mar. 31, 2019 | Jan. 01, 2019 |
Leases [Abstract] | ||
Remainder of 2019 | $ 2 | |
2020 | 3 | |
2021 | 3 | |
2022 | 3 | |
2023 | 3 | |
Remaining years | 91 | |
Future minimum lease payments | 105 | |
Amount representing interest or discounts | (60) | |
Total lease liabilities | 45 | $ 45 |
Short-term lease liabilities | (1) | |
Long-term lease liabilities | $ 44 |
Equity Investments and Loans (S
Equity Investments and Loans (Schedule of Carrying Value Equity Investments) (Details) - USD ($) $ in Millions | Mar. 31, 2019 | Dec. 31, 2018 |
Schedule of Equity Method Investments [Line Items] | ||
Carrying Value | $ 2,897 | $ 2,448 |
Dakota Access, LLC and Energy Transfer Crude Oil Company, LLC (Bakken Pipeline) | ||
Schedule of Equity Method Investments [Line Items] | ||
Percentage Ownership | 25.00% | |
Carrying Value | $ 597 | 608 |
Bayou Bridge Pipeline, LLC (Bayou Bridge) | ||
Schedule of Equity Method Investments [Line Items] | ||
Percentage Ownership | 40.00% | |
Carrying Value | $ 286 | 277 |
DCP Sand Hills Pipeline, LLC (Sand Hills) | ||
Schedule of Equity Method Investments [Line Items] | ||
Percentage Ownership | 33.34% | |
Carrying Value | $ 601 | 601 |
DCP Southern Hills Pipeline, LLC (Southern Hills) | ||
Schedule of Equity Method Investments [Line Items] | ||
Percentage Ownership | 33.34% | |
Carrying Value | $ 209 | 206 |
Explorer Pipeline Company (Explorer) | ||
Schedule of Equity Method Investments [Line Items] | ||
Percentage Ownership | 21.94% | |
Carrying Value | $ 110 | $ 115 |
Gray Oak Pipeline, LLC (Gray Oak) | ||
Schedule of Equity Method Investments [Line Items] | ||
Percentage Ownership | 65.00% | 75.00% |
Carrying Value | $ 741 | $ 288 |
Paradigm Pipeline LLC (Paradigm) | ||
Schedule of Equity Method Investments [Line Items] | ||
Percentage Ownership | 50.00% | |
Carrying Value | $ 144 | 145 |
Phillips 66 Partners Terminal LLC (Phillips 66 Partners Terminal) | ||
Schedule of Equity Method Investments [Line Items] | ||
Percentage Ownership | 70.00% | |
Carrying Value | $ 71 | 71 |
South Texas Gateway Terminal LLC (South Texas Gateway Terminal) | ||
Schedule of Equity Method Investments [Line Items] | ||
Percentage Ownership | 25.00% | |
Carrying Value | $ 24 | 20 |
STACK Pipeline LLC (STACK) | ||
Schedule of Equity Method Investments [Line Items] | ||
Percentage Ownership | 50.00% | |
Carrying Value | $ 114 | $ 117 |
Equity Investments and Loans _2
Equity Investments and Loans (Schedule of Equity Investment Earnings (Losses) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Schedule of Equity Method Investments [Line Items] | ||
Equity in earnings (losses) of affiliates | $ 119 | $ 98 |
Dakota Access, LLC and Energy Transfer Crude Oil Company, LLC (Bakken Pipeline) | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity in earnings (losses) of affiliates | 51 | 32 |
Bayou Bridge Pipeline, LLC (Bayou Bridge) | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity in earnings (losses) of affiliates | 4 | 5 |
DCP Sand Hills Pipeline, LLC (Sand Hills) | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity in earnings (losses) of affiliates | 36 | 25 |
DCP Southern Hills Pipeline, LLC (Southern Hills) | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity in earnings (losses) of affiliates | 13 | 7 |
Explorer Pipeline Company (Explorer) | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity in earnings (losses) of affiliates | 3 | 16 |
Gray Oak Pipeline, LLC (Gray Oak) | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity in earnings (losses) of affiliates | 0 | 0 |
Paradigm Pipeline LLC (Paradigm) | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity in earnings (losses) of affiliates | 3 | 2 |
Phillips 66 Partners Terminal LLC (Phillips 66 Partners Terminal) | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity in earnings (losses) of affiliates | 6 | 9 |
South Texas Gateway Terminal LLC (South Texas Gateway Terminal) | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity in earnings (losses) of affiliates | 0 | 0 |
STACK Pipeline LLC (STACK) | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity in earnings (losses) of affiliates | $ 3 | $ 2 |
Equity Investments and Loans (N
Equity Investments and Loans (Narrative) (Details) - USD ($) | 2 Months Ended | 3 Months Ended | |||||
Feb. 28, 2019 | Mar. 31, 2019 | Mar. 31, 2018 | Apr. 01, 2019 | Mar. 29, 2019 | Dec. 31, 2018 | Apr. 30, 2018 | |
Schedule of Equity Method Investments [Line Items] | |||||||
Proceeds from sale of equity interest | $ 81,000,000 | ||||||
Proceeds for other financing activities | 341,000,000 | $ 0 | |||||
Equity investments | $ 2,897,000,000 | $ 2,448,000,000 | |||||
Gray Oak Pipeline, LLC (Gray Oak) | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Co-venture ownership interest | 25.00% | ||||||
Ownership interest acquired, percentage | 65.00% | 75.00% | |||||
Effective ownership interest | 42.25% | ||||||
Maximum loss exposure, amount | $ 771,000,000 | ||||||
Maximum exposure | $ 30,000,000 | ||||||
Equity investments | 741,000,000 | 288,000,000 | |||||
Maximum loan, amount | $ 520,000,000 | ||||||
Dakota Access and ETCO | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Maximum exposure, undiscounted | $ 631,000,000 | ||||||
South Texas Gateway Terminal LLC (South Texas Gateway Terminal) | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Ownership interest acquired, percentage | 25.00% | ||||||
Equity investments | $ 24,000,000 | $ 20,000,000 | |||||
Common Control Transaction | Gray Oak Holdings LLC | Phillips 66 PDI | Gray Oak Pipeline, LLC (Gray Oak) | Phillips 66 | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Controlling interest acquired, percentage | 100.00% | ||||||
Gray Oak Pipeline, LLC (Gray Oak) | Related Party Loan | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Maximum loan, amount with co-venturers | $ 1,230,000,000 | ||||||
Dakota Access and ETCO | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Maximum exposure, undiscounted, co-venturers | 2,525,000,000 | ||||||
Third Party | Gray Oak Pipeline, LLC (Gray Oak) | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Percentage of ownership | 10.00% | ||||||
Third Party | Gray Oak Holdings LLC | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Percentage of ownership | 35.00% | ||||||
Gray Oak Holdings LLC | Third Party | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Proceeds from sale of equity interest | $ 81,000,000 | ||||||
Proceeds for other financing activities | 341,000,000 | ||||||
Subsequent Event | Gray Oak Pipeline, LLC (Gray Oak) | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Due from related parties | $ 53,000,000 | ||||||
Subsequent Event | Gray Oak Pipeline, LLC (Gray Oak) | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Due to related parties | $ 125,000,000 | ||||||
Senior Notes | Dakota Access, LLC | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Debt instrument, face amount | $ 2,500,000,000 |
Net Income Per Limited Partne_3
Net Income Per Limited Partner Unit (Schedule of Earnings Per unit of our Limited Partners) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Limited Partners' Capital Account [Line Items] | ||
Net income | $ 198 | $ 172 |
Distributions declared | 184 | 148 |
Distributions less than net income | 14 | 24 |
General Partner | ||
Limited Partners' Capital Account [Line Items] | ||
Net income | 69 | 53 |
Distributions declared | 69 | 51 |
Preferred Units | ||
Limited Partners' Capital Account [Line Items] | ||
Net income | 9 | |
Preferred Units | Limited Partner | ||
Limited Partners' Capital Account [Line Items] | ||
Net income | 10 | 9 |
Distributions declared | 10 | 9 |
Common Units | Limited Partner | ||
Limited Partners' Capital Account [Line Items] | ||
Net income | 119 | 110 |
Distributions declared | $ 105 | $ 88 |
Net Income Per Limited Partne_4
Net Income Per Limited Partner Unit (Schedule of Net Income By Class of Participating Securities) (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Partners' Capital [Abstract] | ||
Distributions declared | $ 184 | $ 148 |
Distributions less than net income | 14 | 24 |
Net income (basic) | $ 198 | $ 172 |
Dilutive effect of preferred units (in shares) | 13,819,791 | 13,819,791 |
Common Units | ||
Partners' Capital [Abstract] | ||
Weighted-average units outstanding—basic (in shares) | 124,257,933 | 121,609,520 |
Weighted-average units outstanding—diluted (in shares) | 138,077,724 | 135,429,311 |
Net income attributable to the Partnership per limited partner unit—basic (in dollars per share) | $ 0.96 | $ 0.91 |
Net income attributable to the Partnership per limited partner unit—diluted (in dollars per share) | $ 0.92 | $ 0.87 |
Preferred Units | ||
Partners' Capital [Abstract] | ||
Net income (basic) | $ 9 | |
General Partner | ||
Partners' Capital [Abstract] | ||
Distributions declared | $ 69 | 51 |
Distributions less than net income | 0 | 2 |
Net income (basic) | 69 | 53 |
Limited Partner | ||
Partners' Capital [Abstract] | ||
Dilutive effect of preferred units | 8 | 7 |
Limited Partner | Common Units | ||
Partners' Capital [Abstract] | ||
Distributions declared | 105 | 88 |
Distributions less than net income | 14 | 22 |
Net income (basic) | 119 | 110 |
Net income (diluted) | 127 | 117 |
Limited Partner | Preferred Units | ||
Partners' Capital [Abstract] | ||
Distributions declared | 10 | 9 |
Distributions less than net income | 0 | 0 |
Net income (basic) | $ 10 | $ 9 |
Net Income Per Limited Partne_5
Net Income Per Limited Partner Unit (Narrative) (Details) | Apr. 17, 2019$ / shares |
Common Units | Cash Distribution | Subsequent Event | |
Subsequent Events [Abstract] | |
Quarterly cash distribution declared per limited partner unit (in dollars per share) | $ 0.845 |
Properties, Plants and Equipm_3
Properties, Plants and Equipment (Details) - USD ($) $ in Millions | Mar. 31, 2019 | Dec. 31, 2018 |
Property, Plant and Equipment [Line Items] | ||
Gross PP&E | $ 4,076 | $ 3,995 |
Less: accumulated depreciation | 972 | 943 |
Net PP&E | 3,104 | 3,052 |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Gross PP&E | 19 | 19 |
Buildings and improvements | ||
Property, Plant and Equipment [Line Items] | ||
Gross PP&E | 91 | 89 |
Pipelines and related assets | ||
Property, Plant and Equipment [Line Items] | ||
Gross PP&E | 1,400 | 1,398 |
Terminals and related assets | ||
Property, Plant and Equipment [Line Items] | ||
Gross PP&E | 711 | 710 |
Rail racks and related assets | ||
Property, Plant and Equipment [Line Items] | ||
Gross PP&E | 137 | 137 |
Processing and related assets | ||
Property, Plant and Equipment [Line Items] | ||
Gross PP&E | 863 | 842 |
Caverns and related assets | ||
Property, Plant and Equipment [Line Items] | ||
Gross PP&E | 584 | 584 |
Construction-in-progress | ||
Property, Plant and Equipment [Line Items] | ||
Gross PP&E | $ 271 | $ 216 |
Debt (Summary of Long-Term Debt
Debt (Summary of Long-Term Debt) (Details) - USD ($) | Mar. 31, 2019 | Dec. 31, 2018 |
Debt Instrument [Line Items] | ||
Debt at face value | $ 3,215,000,000 | $ 3,075,000,000 |
Net unamortized discounts and debt issuance costs | (27,000,000) | (27,000,000) |
Total debt | 3,188,000,000 | 3,048,000,000 |
Short-term debt | (15,000,000) | (50,000,000) |
Long-term debt | 3,173,000,000 | 2,998,000,000 |
Term Loan Due March 2020 | ||
Debt Instrument [Line Items] | ||
Term loan | $ 250,000,000 | 0 |
Interest rate, stated percentage | 3.491% | |
Tax-exempt bonds | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | $ 75,000,000 | $ 75,000,000 |
Interest rate, stated percentage | 1.655% | 1.885% |
Senior Notes | 2.646% Senior Notes due February 2020 | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | $ 300,000,000 | $ 300,000,000 |
Interest rate, stated percentage | 2.646% | 2.646% |
Senior Notes | 3.605% Senior Notes due February 2025 | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | $ 500,000,000 | $ 500,000,000 |
Interest rate, stated percentage | 3.605% | 3.605% |
Senior Notes | 3.550% Senior Notes due October 2026 | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | $ 500,000,000 | $ 500,000,000 |
Interest rate, stated percentage | 3.55% | 3.55% |
Senior Notes | 3.750% Senior Notes due March 2028 | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | $ 500,000,000 | $ 500,000,000 |
Interest rate, stated percentage | 3.75% | 3.75% |
Senior Notes | 4.680% Senior Notes due February 2045 | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | $ 450,000,000 | $ 450,000,000 |
Interest rate, stated percentage | 4.68% | 4.68% |
Senior Notes | 4.900% Senior Notes due October 2046 | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | $ 625,000,000 | $ 625,000,000 |
Interest rate, stated percentage | 4.90% | 4.90% |
Revolving Credit Facility | ||
Debt Instrument [Line Items] | ||
Long-term line of credit | $ 15,000,000 | $ 125,000,000 |
Debt, weighted average interest rate | 3.68% | 3.669% |
Debt (Narrative) (Details)
Debt (Narrative) (Details) - USD ($) | Apr. 01, 2019 | Mar. 31, 2019 | Mar. 22, 2019 | Dec. 31, 2018 |
Debt Instrument [Line Items] | ||||
Long-term debt | $ 3,173,000,000 | $ 2,998,000,000 | ||
Fair Value, Inputs, Level 2 | Senior Notes | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, fair value disclosure | 2,847,000,000 | 2,660,000,000 | ||
Tax-exempt bonds | Fair Value, Inputs, Level 2 | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, fair value disclosure | 340,000,000 | 200,000,000 | ||
Term Loan Due March 2020 | ||||
Debt Instrument [Line Items] | ||||
Maximum borrowing capacity | $ 400,000,000 | |||
Long-term debt | 250,000,000 | $ 0 | ||
Senior Notes and Term Loan Due 2020 | Senior Notes | ||||
Debt Instrument [Line Items] | ||||
Long-term debt | 550,000,000 | |||
Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Maximum borrowing capacity | $ 750,000,000 | |||
Subsequent Event | Term Loan Due March 2020 | ||||
Debt Instrument [Line Items] | ||||
Proceeds from line of credit | $ 120,000,000 |
Equity (Details)
Equity (Details) - USD ($) | 3 Months Ended | 34 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2019 | Jun. 30, 2018 | |
Limited Partners' Capital Account [Line Items] | ||||
Number of common units issued in public offering (in shares) | 622,032 | 188,815 | ||
At The Market Offering Program | Common Units | ||||
Limited Partners' Capital Account [Line Items] | ||||
Number of common units issued in public offering (in shares) | 622,032 | 188,815 | 6,872,996 | |
Issuance of common units | $ 32,000,000 | $ 9,000,000 | $ 352,000,000 | |
Brokers commissions | 4,000,000 | |||
Maximum | At The Market Offering Program | Common Units | ||||
Limited Partners' Capital Account [Line Items] | ||||
Maximum aggregate amount of continuous units issuance authorized | $ 250,000,000 | $ 250,000,000 | $ 250,000,000 |
Cash Flow Information (Details)
Cash Flow Information (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Capital Expenditures And Investments [Abstract] | ||
Cash capital expenditures and investments | $ 634 | $ 74 |
Change in capital expenditure accruals | (2) | (5) |
Total capital expenditures and investments | $ 632 | $ 69 |
Related Party Transactions (Sum
Related Party Transactions (Summary of Related Party Transactions) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Related Party Transactions [Abstract] | ||
Operating and maintenance expenses | $ 105 | $ 65 |
General and administrative expenses | 17 | 15 |
Total | $ 122 | $ 80 |
Related Party Transactions (Nar
Related Party Transactions (Narrative) (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Phillips 66 | Amended Omnibus Agreement | Phillips 66 | |
Related party agreements and fees | |
Monthly operational and administrative support fee | $ 8 |
Gray Oak Pipeline, LLC (Gray Oak) | |
Related party agreements and fees | |
Maximum exposure | $ 30 |
Related Party Transactions (Oth
Related Party Transactions (Other Related Party Balances) (Details) - USD ($) $ in Millions | Mar. 31, 2019 | Dec. 31, 2018 |
Related Party Transaction [Line Items] | ||
Prepaid expenses and other current assets | $ 11 | $ 20 |
Other assets | 51 | 5 |
Deferred revenues | 22 | 60 |
Other current liabilities | 3 | 5 |
Other liabilities | 97 | 42 |
Phillips 66 | ||
Related Party Transaction [Line Items] | ||
Prepaid expenses and other current assets | 4 | 4 |
Other assets | 45 | 0 |
Deferred revenues | 22 | 60 |
Other current liabilities | 1 | 0 |
Other liabilities | $ 71 | $ 18 |
Uncategorized Items - psx-20190
Label | Element | Value |
General Partner [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ 1,000,000 |
Common Units [Member] | Non-public Designator [Member] | Majority Shareholder [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | 16,000,000 |
Common Units [Member] | Public Designator [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | 13,000,000 |
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ (1,000,000) |