Organization and Business Description

9 Months Ended

Sep. 30, 2023

Disclosure Partnership Organization And Basis Of Presentation Narrative [Abstract]

Organization and Business Description

Organization and Business Description

The accompanying notes to the consolidated financial statements apply to Crestwood Equity Partners LP (Crestwood Equity or CEQP) and Crestwood Midstream Partners LP (Crestwood Midstream or CMLP).

The accompanying consolidated financial statements and related notes should be read in conjunction with our 2022 Annual Report on Form 10-K filed with the Securities and Exchange Commission (SEC) on February 27, 2023. The financial information as of September 30, 2023 and for the three and nine months ended September 30, 2023 and 2022, is unaudited. The consolidated balance sheets as of December 31, 2022 were derived from the audited balance sheets filed in our 2022 Annual Report on Form 10-K.

Unless otherwise indicated, references in this report to “we,” “us,” “our,” “ours,” “our company,” the “Partnership,” the “Company,” “Crestwood Equity,” “CEQP,” and similar terms refer to either Crestwood Equity Partners LP itself or Crestwood Equity Partners LP and its consolidated subsidiaries, as the context requires. Unless otherwise indicated, references to “Crestwood Midstream” and “CMLP” refer to Crestwood Midstream Partners LP and its consolidated subsidiaries, as the context requires.

Organization

Energy Transfer LP Merger. On November 3, 2023, Crestwood Equity is expected to merge with and into a direct wholly-owned subsidiary of Energy Transfer LP (Energy Transfer) in an all-equity transaction valued at approximately $7.1 billion (the Energy Transfer Merger). On August 16, 2023, Crestwood Equity entered into a merger agreement with Energy Transfer pursuant to which each Crestwood Equity common unit representing limited partner interests in Crestwood Equity issued and outstanding immediately prior to the Energy Transfer Merger will be converted into the right to receive 2.07 common units representing limited partner interests in Energy Transfer. Each preferred unit representing limited partner interests in Crestwood Equity issued and outstanding immediately prior to the Energy Transfer Merger will, at the election of the holder of such preferred unit, be (i) converted into a preferred unit of Energy Transfer that has substantially similar terms, including with respect to economics and structural protections, as the preferred units of Crestwood Equity, (ii) redeemed in exchange for cash, at a price of 108% of the preferred unit price plus accrued and unpaid distributions to the date of such redemption, or (iii) converted into common units, at the then-applicable conversion ratio (one common unit for 10 preferred), subject to the payment of any accrued but unpaid distributions prior to Energy Transfer Merger. In connection with the Energy Transfer Merger and at the direction of Energy Transfer, Crestwood Equity conducted a consent solicitation pursuant to which Crestwood Equity solicited consent from the preferred unitholders to approve an amendment to its Sixth Amended and Restated Agreement of Limited Partnership. Pursuant to the proposed amendment, among other things, (i) the preferred unitholders electing a cash redemption in the Energy Transfer Merger would receive such cash redemption price as increased from 101% to 108% of the preferred unit price; and (ii) the preferred unitholders electing to receive preferred units of Energy Transfer would receive such preferred units of Energy Transfer with terms similar to Energy Transfer’s other outstanding series of preferred units. Crestwood Equity received the consents from the preferred unitholders necessary to approve the proposed amendment and therefore, the proposed amendment will be adopted at the closing of the Energy Transfer Merger.

For more information regarding the merger and the merger agreement, see our Current Report on Form 8-K filed with the SEC on August 16, 2023 and our definitive merger proxy statement on Schedule 14A filed with the SEC on September 29, 2023.

Crestwood Equity Partners LP. CEQP is a publicly-traded Delaware limited partnership, and its common units are listed on the New York Stock Exchange (NYSE) under the ticker symbol “CEQP” and its preferred units are listed on the NYSE under the ticker symbol “CEQP-P.” In connection with the consummation of the Energy Transfer Merger, we requested that the NYSE delist our common and preferred units and, as a result, trading of our common and preferred units will be suspended on November 3, 2023. We also requested that the NYSE file a Form 25 with the SEC notifying the SEC of the delisting of our common and preferred units and the withdrawal of registration of our common and preferred units under Section 12(b) of the Exchange Act. Following the effectiveness of the Form 25, we intend to file with the SEC a Form 15 regarding the termination of registration of our common and preferred units under the Exchange Act and the suspension of reporting obligations with respect to our common and preferred units.

Crestwood Midstream Partners LP. Crestwood Equity owns a 99.9% limited partnership interest in Crestwood Midstream and Crestwood Gas Services GP LLC, a wholly-owned subsidiary of Crestwood Equity, owns a 0.1% limited partnership interest in Crestwood Midstream. Crestwood Midstream GP LLC, a wholly-owned subsidiary of Crestwood Equity, owns the non-economic general partnership interest of Crestwood Midstream.

Business Description

Crestwood Equity develops, acquires, owns or controls, and operates primarily fee-based assets and operations within the energy midstream sector. We provide broad-ranging infrastructure solutions across the value chain to service premier liquids-rich natural gas and crude oil shale plays across North America. We own and operate a diversified portfolio of natural gas liquids (NGLs), crude oil, natural gas and produced water gathering, processing, storage, disposal and transportation assets that connect fundamental energy supply with energy demand across the United States. Crestwood Equity is a holding company and all of its consolidated operating assets are owned by or through its wholly-owned subsidiary, Crestwood Midstream.

See Note 13 for information regarding our operating and reporting segments.