Accounts Receivable Sales Programs

9 Months Ended

Sep. 30, 2011

Accounts Receivable Sales Programs [Abstract]

Accounts Receivable Sales Programs

14. Accounts Receivable Sales Programs

     Accounts Receivable Sales Programs. We participate in accounts receivable sales programs where several of our pipeline subsidiaries sell receivables in their entirety to a third-party financial institution (through wholly-owned special purpose entities). The sale of these accounts receivable (which are short-term assets that generally settle within 60 days) qualify for sale accounting. The third party financial institution involved in these accounts receivable sales programs acquires interests in various financial assets and issues commercial paper to fund those acquisitions. We do not consolidate the third party financial institution because we do not have the power to control, direct, or exert significant influence over its overall activities since our receivables do not comprise a significant portion of its operations.

     In connection with our accounts receivable sales, we receive a portion of the sales proceeds up front and receive an additional amount upon the collection of the underlying receivables (which we refer to as a deferred purchase price). Our ability to recover the deferred purchase price is based solely on the collection of the underlying receivables. The table below contains information related to our accounts receivable sales programs.

	Quarters Ended				Nine Months Ended
	September 30,				September 30,
	2011		2010		2011		2010
	(In millions)
Accounts receivable sold to the third-party financial institution(1)	$	647	$	599	$	1,851	$	1,805
Cash received for accounts receivable sold under the programs		356		338		1,051		1,124
Deferred purchase price related to accounts receivable sold		291		261		800		681
Cash received related to the deferred purchase price		295		266		793		746
Amount paid in conjunction with terminated programs (2)		—		—		—		90

(1)	During the quarters and nine months ended September 30, 2011 and 2010, losses recognized on the sale of accounts receivable were immaterial.
(2)	In January 2010, we terminated our previous accounts receivable sales programs and paid $90 million to acquire the related senior interests in certain receivables under those programs. See our 2010 Annual Report on Form 10-K for further information.

	September 30,		December 31,
	2011		2010
	(In millions)
Accounts receivable sold and held by third-party financial institution	$	213	$	210
Uncollected deferred purchase price related to accounts receivable sold (1)		96		89

⁽¹⁾   Initially recorded at an amount which approximates its fair value as a Level 2 measurement.

     The deferred purchase price related to the accounts receivable sold is reflected as other accounts receivable on our balance sheet. Because the cash received up front and the deferred purchase price relate to the sale or ultimate collection of the underlying receivables, and are not subject to significant other risks given their short term nature, we reflect all cash flows under the accounts receivable sales programs as operating cash flows on our statement of cash flows. Under the accounts receivable sales programs, we service the underlying receivables for a fee. The fair value of these servicing agreements, as well as the fees earned, were not material to our financial statements for the quarters and nine months ended September 30, 2011 and 2010.