Related Party Transactions	9 Months Ended
Sep. 30, 2016
Related Party Transactions
Related Party Transactions	12. RELATED PARTY TRANSACTIONS We are controlled by our general partner. The sole member of our general partner is Manager, which has no officers. In May 2014, we entered into the Services Agreement with Manager pursuant to which Manager provides services that we require to operate our business, including overhead, technical, administrative, marketing, accounting, operational, information systems, financial, compliance, insurance, professionals, acquisition, disposition and financing services. In connection with providing services under the Services Agreement, Manager receives compensation consisting of: (i) a quarterly fee equal to 0.375% of the value of our properties other than our assets located in the Mid-Continent region, (ii) reimbursement for all allocated overhead costs as well as any direct third-party costs incurred and (iii) for each asset acquisition, asset disposition and financing, a fee not to exceed 2% of the value of such transaction. Each of these fees, not including the reimbursement of costs, is paid in cash unless Manager elects for such fee to be paid in our equity. The Services Agreement has a ten-year term and will be automatically renewed for an additional ten years unless both Manager and the Partnership provide notice to terminate the agreement. During the nine months ended September 30, 2016, we expensed $4.9 million to Manager pursuant to the Services Agreement. During the nine months ended September 30, 2015, we paid $5.3 million to Manager under the Services Agreement. Manager utilizes SOG to provide the services under the Services Agreement. In May 2014, we entered into a Contract Operating Agreement with SOG pursuant to which SOG either provides services to operate, develop and produce our oil and natural gas properties or engages a third-party operator to do so, other than with respect to our properties in the Mid-Continent Region. We also have entered into the Geophysical Seismic Data Use License Agreement with SOG pursuant to which SOG provides us a non-exclusive, royalty-free license to use seismic, geophysical and geological information relating to our oil and natural gas properties that is proprietary to SOG and not restricted by agreements that SOG has with landowners or seismic data vendors. The Partnership has entered into a Firm Gathering and Processing Agreement with SN for an initial term of 15 years under which production from approximately 35,000 acres in Dimmit County and Webb County, Texas will be dedicated for gathering by Catarina Midstream, LLC. In addition, for the first five years of the Gathering Agreement, SN Catarina will be required to meet a minimum quarterly volume delivery commitment of 10,200 barrels per day of crude oil and condensate and 142,000 Mcf per day of natural gas, subject to certain adjustments. As of September 30, 2016 and December 31, 2015, the Partnership had a net receivable from related parties of $6.5 million and $1.5 million, respectively, which are included in “Accounts receivable – related entities” in the condensed consolidated balance sheets. As of September 30, 2016 and December 31, 2015, the Partnership also had a net payable from related parties of $3.8 million and $1.0 million, respectively. The net receivables/payable as of September 30, 2016 and December 31, 2015 consist primarily of revenues receivable from oil and natural gas production, offset by costs associated with that production and obligations for general and administrative costs. On March 31, 2015, the Partnership and SN entered into a Purchase and Sale Agreement for the Eagle Ford Acquisition for total consideration of $85.0 million. After $1.4 million in normal and customary closing adjustments, consideration paid at closing consisted of $81.6 million cash paid by us to SN and 105,263 of our common units issued to SN with an aggregate consideration value of $2.0 million. All 105,263 common units issued as consideration for the Eagle Ford Acquisition were repurchased in connection with the Western Catarina Midstream Acquisition in October 2015. See further discussion of the transaction in Note 3, “Acquisitions and Divestitures.” In October 2015, the Partnership and SN consummated the Western Catarina Midstream Acquisition for total consideration of approximately $345.8 million in cash, subject to closing and post-closing adjustments. Concurrently with the signing of the Western Catarina Midstream Acquisition purchase and sale agreement, we entered into a 15-year gas gathering and processing agreement with SN. For the nine months ended September 30, 2016, SN paid us approximately $37.4 million pursuant to the terms of the gathering and processing agreement. See further discussion of the transaction in Note 3, “Acquisitions and Divestitures.” On July 5, 2016, the Partnership entered into an agreement with SN and SN Midstream to purchase 50% of the issued and outstanding membership interests in Carnero Gathering for total consideration of approximately $37.0 million, plus the assumption of approximately $7.4 million of remaining capital contribution commitments. In addition, the Partnership is required to pay an earnout based on gas received at the delivery points from SN Catarina and other producers. The membership interests acquired constitute 50% of the outstanding membership interests in Carnero Gathering, with the other 50% of the membership interests being owned by TPL SouthTex Processing Company LP. Carnero Gathering operates a gas gathering pipeline from an interconnection in Webb County, Texas to interconnection(s) with a gas processing facility being developed and constructed by Carnero Processing. The Partnership made capital contributions to Carnero Gathering totaling $3.0 million between July 5, 2016 and September 30, 2016.See further discussion of the transaction in Note 3, “Acquisitions and Divestitures.” On October 6, 2016, the Partnership entered into a Purchase and Sale Agreement with SN and SN Midstream to purchase all of SN Midstream issued and outstanding membership interests in Carnero Processing (see further discussion in Note 18, “Subsequent Events”). On October 6, 2016, SEP Holdings IV, LLC, a wholly-owned subsidiary of the Partnership, and the Partnership entered into a Purchase and Sale Agreement with SN Cotulla Assets, LLC and SN Palmetto, LLC, each a wholly-owned subsidiary of SN, to purchase oil and gas properties (see further discussion in Note 18, “Subsequent Events”). On October 6, 2016, the Partnership entered into a Purchase and Sale Agreement with SN and SN Terminal, LLC, a wholly-owned subsidiary of SN, pursuant to which the Partnership obtained an option to acquire a ground lease to which SN Terminal, LLC is a party for a tract of land leased from the Calhoun Port Authority in Point Comfort, Texas (see further discussion in Note 18, “Subsequent Events”).

12. RELATED PARTY TRANSACTIONS

We are controlled by our general partner. The sole member of our general partner is Manager, which has no officers. In May 2014, we entered into the Services Agreement with Manager pursuant to which Manager provides services that we require to operate our business, including overhead, technical, administrative, marketing, accounting, operational, information systems, financial, compliance, insurance, professionals, acquisition, disposition and financing services. In connection with providing services under the Services Agreement, Manager receives compensation consisting of: (i) a quarterly fee equal to 0.375% of the value of our properties other than our assets located in the Mid-Continent region, (ii) reimbursement for all allocated overhead costs as well as any direct third-party costs incurred and (iii) for each asset acquisition, asset disposition and financing, a fee not to exceed 2% of the value of such transaction. Each of these fees, not including the reimbursement of costs, is paid in cash unless Manager elects for such fee to be paid in our equity. The Services Agreement has a ten-year term and will be automatically renewed for an additional ten years unless both Manager and the Partnership provide notice to terminate the agreement. During the nine months ended September 30, 2016, we expensed $4.9 million to Manager pursuant to the Services Agreement. During the nine months ended September 30, 2015, we paid $5.3 million to Manager under the Services Agreement.

Manager utilizes SOG to provide the services under the Services Agreement. In May 2014, we entered into a Contract Operating Agreement with SOG pursuant to which SOG either provides services to operate, develop and produce our oil and natural gas properties or engages a third-party operator to do so, other than with respect to our properties in the Mid-Continent Region. We also have entered into the Geophysical Seismic Data Use License Agreement with SOG pursuant to which SOG provides us a non-exclusive, royalty-free license to use seismic, geophysical and geological information relating to our oil and natural gas properties that is proprietary to SOG and not restricted by agreements that SOG has with landowners or seismic data vendors.

The Partnership has entered into a Firm Gathering and Processing Agreement with SN for an initial term of 15 years under which production from approximately 35,000 acres in Dimmit County and Webb County, Texas will be dedicated for gathering by Catarina Midstream, LLC. In addition, for the first five years of the Gathering Agreement, SN Catarina will be required to meet a minimum quarterly volume delivery commitment of 10,200 barrels per day of crude oil and condensate and 142,000 Mcf per day of natural gas, subject to certain adjustments.

As of September 30, 2016 and December 31, 2015, the Partnership had a net receivable from related parties of $6.5 million and $1.5 million, respectively, which are included in “Accounts receivable – related entities” in the condensed consolidated balance sheets. As of September 30, 2016 and December 31, 2015, the Partnership also had a net payable from related parties of $3.8 million and $1.0 million, respectively. The net receivables/payable as of September 30, 2016 and December 31, 2015 consist primarily of revenues receivable from oil and natural gas production, offset by costs associated with that production and obligations for general and administrative costs.

On March 31, 2015, the Partnership and SN entered into a Purchase and Sale Agreement for the Eagle Ford Acquisition for total consideration of $85.0 million. After $1.4 million in normal and customary closing adjustments, consideration paid at closing consisted of $81.6 million cash paid by us to SN and 105,263 of our common units issued to SN with an aggregate consideration value of $2.0 million. All 105,263 common units issued as consideration for the Eagle Ford Acquisition were repurchased in connection with the Western Catarina Midstream Acquisition in October 2015. See further discussion of the transaction in Note 3, “Acquisitions and Divestitures.”

In October 2015, the Partnership and SN consummated the Western Catarina Midstream Acquisition for total consideration of approximately $345.8 million in cash, subject to closing and post-closing adjustments. Concurrently with the signing of the Western Catarina Midstream Acquisition purchase and sale agreement, we entered into a 15-year gas gathering and processing agreement with SN. For the nine months ended September 30, 2016, SN paid us approximately $37.4 million pursuant to the terms of the gathering and processing agreement. See further discussion of the transaction in Note 3, “Acquisitions and Divestitures.”

On July 5, 2016, the Partnership entered into an agreement with SN and SN Midstream to purchase 50% of the issued and outstanding membership interests in Carnero Gathering for total consideration of approximately $37.0 million, plus the assumption of approximately $7.4 million of remaining capital contribution commitments. In addition, the Partnership is required to pay an earnout based on gas received at the delivery points from SN Catarina and other producers. The membership interests acquired constitute 50% of the outstanding membership interests in Carnero Gathering, with the other 50% of the membership interests being owned by TPL SouthTex Processing Company LP. Carnero Gathering operates a gas gathering pipeline from an interconnection in Webb County, Texas to interconnection(s) with a gas processing facility being developed and constructed by Carnero Processing. The Partnership made capital contributions to Carnero Gathering totaling $3.0 million between July 5, 2016 and September 30, 2016.See further discussion of the transaction in Note 3, “Acquisitions and Divestitures.”

On October 6, 2016, the Partnership entered into a Purchase and Sale Agreement with SN and SN Midstream to purchase all of SN Midstream issued and outstanding membership interests in Carnero Processing (see further discussion in Note 18, “Subsequent Events”).

On October 6, 2016, SEP Holdings IV, LLC, a wholly-owned subsidiary of the Partnership, and the Partnership entered into a Purchase and Sale Agreement with SN Cotulla Assets, LLC and SN Palmetto, LLC, each a wholly-owned subsidiary of SN, to purchase oil and gas properties (see further discussion in Note 18, “Subsequent Events”).

On October 6, 2016, the Partnership entered into a Purchase and Sale Agreement with SN and SN Terminal, LLC, a wholly-owned subsidiary of SN, pursuant to which the Partnership obtained an option to acquire a ground lease to which SN Terminal, LLC is a party for a tract of land leased from the Calhoun Port Authority in Point Comfort, Texas (see further discussion in Note 18, “Subsequent Events”).