Related Party Transactions

3 Months Ended

Mar. 31, 2025

Related Party Transactions [Abstract]

Related Party Transactions [Text Block]

Note 4 – Related Party Transactions

Transco and NWP Affiliate Transactions

Cash Management Program

Transco and NWP are participants in Williams’ cash management program, and thus make advances to and receive advances from Williams. At March 31, 2025 and December 31, 2024, Transco’s advances to Williams totaled approximately $567 million and $638 million, respectively. These advances are represented by demand notes and are classified as Trade accounts and other receivables - Advances to affiliate in the Balance Sheet. Advances to Williams from NWP totaled approximately $62 million at March 31, 2025. These advances are represented by demand notes and are classified as Trade accounts and other receivables - Advances to affiliate in the Balance Sheet. NWP’s advances from Williams totaled approximately $26 million at December 31, 2024. These advances from Williams are classified as Payables - Advances from affiliate. Advances are stated at the historical carrying amounts. Interest expense and income are recognized when earned and the collectability is reasonably assured. The interest rate on these intercompany demand notes is based upon the daily overnight investment rate paid on Williams’ excess cash at the end of each month, which was approximately 4 percent at March 31, 2025. The net interest income from these advances was $6 million and $16 million for the three months ended March 31, 2025 and March 31, 2024, for Transco respectively, and $2 million for the three months ended March 31, 2024 for NWP. The net interest income from these advances for NWP was immaterial for the three months ended March 31, 2025. Such interest income is included in Interest income in the Statement of Net Income for Transco and Other income (expense) – net in the Statement of Net Income for NWP.

Other Affiliate Transactions

Included in Transco’s Total revenues in the Statement of Net Income for the three months ended March 31, 2025 and March 31, 2024, are revenues received from affiliates of $20 million and $19 million, respectively.

Included in Transco’s Natural gas product costs in the Statement of Net Income for the three months ended March 31, 2025 and March 31, 2024, are costs of gas purchased from affiliates of $2 million and $2 million, respectively. All gas purchases are made at market or contract prices.

Services necessary to operate Transco and NWP are provided by Williams and certain affiliates of Williams. Transco and NWP reimburse Williams and its affiliates for all direct and indirect expenses incurred or payments made (including salary, bonus, incentive compensation, and benefits) in connection with these services. Employees of Williams also provide general, administrative, and management services, and Transco and NWP are charged for certain administrative expenses incurred by Williams. These charges are either directly assigned or allocated. Allocated charges are specific or general. Specific allocations are based on a relationship with the delivery of services and general allocations are based on a three-factor formula, which considers revenues; property, plant, and equipment; and payroll. In management’s estimation, the allocation methodologies used are reasonable and result in a reasonable allocation of costs of doing business incurred by Williams. For the three months ended March 31, 2025 and March 31, 2024, Transco has recorded $92 million and $85 million, respectively, and NWP has recorded $24 million and $22 million, respectively, for these service expenses, which are primarily included in Operating and maintenance expenses and Selling, general, and administrative expenses in the Statement of Net Income.

Transco provided services to certain of its affiliates. Transco recorded reductions in operating expenses for services provided to and reimbursed by affiliates of $2 million for the three months ended March 31, 2024. No such costs were incurred for the three months ended March 31, 2025.

During April 2025, Transco and NWP declared and paid cash distributions of $360 million and $40 million, respectively, to Williams, and Williams made a cash contribution to NWP of $46 million.