10. DEBT AND INTEREST EXPENSE

At March 31, 2018, WGP’s debt consisted of borrowings under the WGP RCF and WES’s 2.600% Senior Notes due 2018 (the “2018 Notes”), 5.375% Senior Notes due 2021 (the “2021 Notes”), 4.000% Senior Notes due 2022 (the “2022 Notes”), 3.950% Senior Notes due 2025 (the “2025 Notes”), 4.650% Senior Notes due 2026 (the “2026 Notes”), 4.500% Senior Notes due 2028 (the “2028 Notes”), 5.450% Senior Notes due 2044 (the “2044 Notes”) and 5.300% Senior Notes due 2048 (the “2048 Notes”).

The following table presents WES and WGP’s outstanding debt:



	March 31, 2018						December 31, 2017
thousands	Principal		Carrying Value		Fair Value ⁽¹⁾		Principal		Carrying Value		Fair Value ⁽¹⁾
Short-term debt
WGP RCF	$	28,000	$	28,000	$	28,000	$	—	$	—	$	—

Long-term debt
WGP RCF	$	—	$	—	$	—	$	28,000	$	28,000	$	28,000
2018 Notes	350,000		349,810		349,542		350,000		349,684		350,631
2021 Notes	500,000		496,095		522,069		500,000		495,815		530,647
2022 Notes	670,000		668,906		670,857		670,000		668,849		684,043
2025 Notes	500,000		492,120		487,240		500,000		491,885		500,885
2026 Notes	500,000		495,360		508,551		500,000		495,245		520,144
2028 Notes	400,000		394,285		401,807		—		—		—
2044 Notes	600,000		593,262		605,816		600,000		593,234		637,827
2048 Notes	700,000		686,508		698,234		—		—		—
WES RCF	—		—		—		370,000		370,000		370,000
Total long-term debt	$	4,220,000	$	4,176,346	$	4,244,116	$	3,518,000	$	3,492,712	$	3,622,177


⁽¹⁾	Fair value is measured using the market approach and Level 2 inputs.

Debt activity. The following table presents WES and WGP’s debt activity for the three months ended March 31, 2018:



thousands	Carrying Value
Balance at December 31, 2017	$	3,492,712
WES RCF borrowings	260,000
Issuance of 2028 Notes	400,000
Issuance of 2048 Notes	700,000
Repayments of WES RCF borrowings	(630,000		)
Other	(18,366		)
Balance at March 31, 2018	$	4,204,346

WGP RCF. In February 2018, WGP voluntarily reduced the aggregate commitments of the lenders under the WGP RCF, which matures in March 2019, to $35.0 million. As of March 31, 2018, the outstanding borrowings under the WGP RCF were classified as short-term debt on the consolidated balance sheet.

As of March 31, 2018, WGP had $28.0 million outstanding borrowings and $7.0 million available for borrowing under the WGP RCF. As of March 31, 2018 and 2017, the interest rate on the outstanding WGP RCF borrowings was 3.88% and 2.99%, respectively. The commitment fee rate was 0.30% at March 31, 2018 and 2017. At March 31, 2018, WGP was in compliance with all covenants under the WGP RCF.

10. DEBT AND INTEREST EXPENSE (CONTINUED)

WES Senior Notes. The 2018 Notes, which are due in August 2018, were classified as long-term debt on the consolidated balance sheet at March 31, 2018, as WES has the ability and intent to refinance these obligations using long-term debt.

The 2028 Notes and 2048 Notes issued in March 2018 were offered at prices to the public of 99.435% and 99.169%, respectively, of the face amount. Including the effects of the issuance and underwriting discounts, the effective interest rates of the 2028 Notes and 2048 Notes are 4.682% and 5.431%, respectively. Interest is paid on each such series semi-annually on March 1 and September 1 of each year, beginning September 1, 2018. A portion of the proceeds (net of underwriting discounts, original issue discounts and debt issuance costs) was used to repay amounts outstanding under the WES RCF and for WES’s general partnership purposes, including to fund capital expenditures.

At March 31, 2018, WES was in compliance with all covenants under the indentures governing its outstanding notes.

WES RCF. In February 2018, WES entered into the five-year $1.5 billion WES RCF by amending and restating the $1.2 billion credit facility that was originally entered into in February 2014. The WES RCF is expandable to a maximum of $2.0 billion, matures in February 2023, with options to extend maturity by up to two additional one year increments, and bears interest at the London Interbank Offered Rate (“LIBOR”), plus applicable margins ranging from 1.00% to 1.50%, or an alternate base rate equal to the greatest of (a) the Prime Rate, (b) the Federal Funds Effective Rate plus 0.50%, or (c) LIBOR plus 1.00%, in each case plus applicable margins currently ranging from zero to 0.50%, based upon WES’s senior unsecured debt rating. WES is required to pay a quarterly facility fee ranging from 0.125% to 0.250% of the commitment amount (whether used or unused), also based upon its senior unsecured debt rating.

As of March 31, 2018, WES had no outstanding WES RCF borrowings and $4.6 million in outstanding letters of credit, resulting in $1,495.4 million available borrowing capacity under the RCF. As of March 31, 2018 and 2017, the interest rate on any outstanding WES RCF borrowings was 3.18% and 2.28%, respectively. The facility fee rate was 0.20% at March 31, 2018 and 2017. At March 31, 2018, WES was in compliance with all covenants under the WES RCF.

Interest expense. The following table summarizes the amounts included in interest expense:



	Three Months Ended March 31,
thousands	2018			2017
Third parties
Long-term and short-term debt	$	(41,536	)	$	(34,814	)
Amortization of debt issuance costs and commitment fees	(2,864		)	(1,964		)
Capitalized interest	4,054			816
Total interest expense – third parties	(40,346		)	(35,962		)
Affiliates
Deferred purchase price obligation – Anadarko ⁽¹⁾	—			(71		)
Total interest expense – affiliates	—			(71		)
Interest expense	$	(40,346	)	$	(36,033	)


⁽¹⁾	See Note 3 for a discussion of the Deferred purchase price obligation - Anadarko.