Business Activities and Related Party Transactions

3 Months Ended

Mar. 31, 2012

Business Activities and Related Party Transactions [Abstract]

Business Activities and Related Party Transactions

4.   Business Activities and Related Party Transactions

We do not receive a fee for our services under the delegation of control agreement, nor do we receive any margin or profit when we are reimbursed for expenses incurred. We incurred, on behalf of KMP, approximately $79 million and $73 million of expenses during the three months ended March 31, 2012 and 2011, respectively. The expense reimbursements by KMP to us are accounted for as a reduction to the expense incurred by us. At both March 31, 2012 and December 31, 2011, $10 million, primarily receivables from KMP, is recorded in the caption “Accounts receivable, related party” in the accompanying interim consolidated balance sheets.

One of our affiliates provides, and incurs expense with respect to, payroll services to KMP. These expenses are reimbursed by KMP at cost. These expenses totaled approximately $114 million and $106 million during the three months ended March 31, 2012 and 2011, respectively.