XML 39 R25.htm IDEA: XBRL DOCUMENT v2.4.0.8
Subsidiary Guarantors
 9 Months Ended
Sep. 30, 2013
Subsidiary Guarantors [Abstract]  
Subsidiary Guarantors

NOTE 18 – SUBSIDIARY GUARANTORS 

 

The Senior Notes, issued on July 30, 2012 by the Partnership and QRE FC (the “Subsidiary Co-Issuer”), are guaranteed by OLLC, a 100% owned subsidiary of the Partnership (the “Guarantor”), and may be guaranteed by certain other future subsidiaries. The Guarantor is 100% owned by the Partnership and its guarantee of the Senior Notes is full and unconditional. The Partnership has no assets or operations independent of its subsidiaries and there are no significant restrictions upon the ability of the Guarantor to distribute funds to the Partnership. The guarantee constitutes a joint and several obligation with any additional future guarantees. The Partnership’s only other subsidiary is ETSWDC, which does not guarantee the Senior Notes (the “Non-Guarantor”). Refer to Note 10 – Long-Term Debt for details on the conditions under which guarantees of the Senior Notes may be released. ETSWDC is a non-minor subsidiary and we are providing condensed consolidated financial statements prospectively in accordance with SEC regulations.

 

The following condensed consolidated financial information is presented in accordance with Rule 3-10 of the Securities and Exchange Commission’s Regulation S-X, and uses the same accounting policies used to prepare the financial information located elsewhere in our consolidated financial statements and related footnotes.  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Condensed Consolidating Balance Sheets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

September 30, 2013

 

 

Parent Co-Issuer

 

 

Subsidiary Co-Issuer

 

 

 

Guarantor

 

 

Non-Guarantor

 

 

Eliminations

 

 

Consolidated

Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash

$

 -

 

$

 -

 

 

$
21,851 

 

$
4,213 

 

$

 -

 

$
26,064 

Accounts receivable

 

 -

 

 

 -

 

 

 
56,055 

 

 
2,941 

 

 
(319)

 

 
58,677 

Due from affiliates

 
237,235 

 

 

 -

 

 

 
3,323 

 

 

 -

 

 
(238,011)

 

 
2,547 

Derivative instruments

 

 -

 

 

 -

 

 

 
30,399 

 

 

 -

 

 

 -

 

 
30,399 

Prepaid and other current assets

 

 -

 

 

 -

 

 

 
1,705 

 

 
489 

 

 

 -

 

 
2,194 

Total current assets

 
237,235 

 

 

 -

 

 

 
113,333 

 

 
7,643 

 

 
(238,330)

 

 
119,881 

Noncurrent assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Oil and natural gas properties and other property and equipment, net

 

 -

 

 

 -

 

 

 
1,562,752 

 

 
13,056 

 

 

 -

 

 
1,575,808 

Derivative instruments

 

 -

 

 

 -

 

 

 
63,070 

 

 

 -

 

 

 -

 

 
63,070 

Investment in subsidiaries

 
708,451 

 

 

 -

 

 

 
13,194 

 

 

 -

 

 
(721,645)

 

 

 -

Other assets

 
4,840 

 

 

 -

 

 

 
17,673 

 

 
17,265 

 

 

 -

 

 
39,778 

Total noncurrent assets

 
713,291 

 

 

 -

 

 

 
1,656,689 

 

 
30,321 

 

 
(721,645)

 

 
1,678,656 

Total assets

$
950,526 

 

$

 -

 

 

$
1,770,022 

 

$
37,964 

 

$
(959,975)

 

$
1,798,537 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities and Partners' Capital

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current portions of asset retirement obligations

$

 -

 

$

 -

 

 

$
1,729 

 

$

 -

 

$

 -

 

$
1,729 

Due to affiliates

 
775 

 

 

 -

 

 

 
237,235 

 

 

 -

 

 
(238,010)

 

 

 -

Derivative instruments

 

 -

 

 

 -

 

 

 
15,306 

 

 

 -

 

 

 -

 

 
15,306 

Accrued and other liabilities

 
8,125 

 

 

 -

 

 

 
54,781 

 

 
1,998 

 

 
(319)

 

 
64,585 

Total current liabilities

 
8,900 

 

 

 -

 

 

 
309,051 

 

 
1,998 

 

 
(238,329)

 

 
81,620 

Noncurrent liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Long-term debt

 
296,464 

 

 

 -

 

 

 
600,000 

 

 

 -

 

 

 -

 

 
896,464 

Derivative instruments

 

 -

 

 

 -

 

 

 
9,247 

 

 

 -

 

 

 -

 

 
9,247 

Asset retirement obligations

 

 -

 

 

 -

 

 

 
136,194 

 

 
4,659 

 

 

 -

 

 
140,853 

Other liabilities

 

 -

 

 

 -

 

 

 
7,079 

 

 
11,855 

 

 

 -

 

 
18,934 

Total noncurrent liabilities

 
296,464 

 

 

 -

 

 

 
752,520 

 

 
16,514 

 

 

 -

 

 
1,065,498 

Partners' capital

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

QR Energy, LP partners' capital

 
645,162 

 

 

 -

 

 

 
708,451 

 

 
19,452 

 

 
(727,903)

 

 
645,162 

Noncontrolling interest

 

 -

 

 

 -

 

 

 

 -

 

 

 -

 

 
6,257 

 

 
6,257 

Total partners' capital

 
645,162 

 

 

 -

 

 

 
708,451 

 

 
19,452 

 

 
(721,646)

 

 
651,419 

Total liabilities and partners' capital

$
950,526 

 

$

 -

 

 

$
1,770,022 

 

$
37,964 

 

$
(959,975)

 

$
1,798,537 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Condensed Consolidating Statements of Operations

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Parent Co-Issuer

 

 

Subsidiary Co-Issuer

 

 

Guarantor

 

 

Non-Guarantor

 

 

Eliminations

 

 

Consolidated

Three Months Ended September 30, 2013

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total revenues

$

 -

 

$

 -

 

$
122,150 

 

$
4,506 

 

$
(649)

 

$
126,007 

Expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Production and disposal and related expenses

 

 -

 

 

 -

 

 
44,010 

 

 
3,895 

 

 
(649)

 

 
47,256 

Depreciation, depletion and amortization

 

 -

 

 

 -

 

 
27,961 

 

 
57 

 

 

 -

 

 
28,018 

General and administrative

 
1,939 

 

 

 -

 

 
9,265 

 

 

 -

 

 

 -

 

 
11,204 

Accretion of asset retirement obligations and acquisition and transaction costs

 

 -

 

 

 -

 

 
2,312 

 

 
44 

 

 

 -

 

 
2,356 

Total expenses

 
1,939 

 

 

 -

 

 
83,548 

 

 
3,996 

 

 
(649)

 

 
88,834 

Operating income

 
(1,939)

 

 

 -

 

 
38,602 

 

 
510 

 

 

 -

 

 
37,173 

Loss on commodity derivative contracts

 

 -

 

 

 -

 

 
(45,377)

 

 

 -

 

 

 -

 

 
(45,377)

Interest expense, net, income tax expense and other income, net

 
(7,244)

 

 

 -

 

 
(6,044)

 

 
(5)

 

 

 -

 

 
(13,293)

Equity in earnings

 
(12,536)

 

 

 -

 

 
281 

 

 

 -

 

 
12,255 

 

 

 -

Net (loss) income

 
(21,719)

 

 

 -

 

 
(12,538)

 

 
505 

 

 
12,255 

 

 
(21,497)

Less: Net income attributable to noncontrolling interest

 

 -

 

 

 -

 

 

 -

 

 

 -

 

 
222 

 

 
222 

Net income (loss) attributable to QR Energy, LP

$
(21,719)

 

$

 -

 

$
(12,538)

 

$
505 

 

$
12,033 

 

$
(21,719)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Condensed Consolidating Statements of Operations

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Parent Co-Issuer

 

 

Subsidiary Co-Issuer

 

 

Guarantor

 

 

Non-Guarantor

 

 

Eliminations

 

 

Consolidated

Nine Months Ended September 30, 2013

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total revenues

$

 -

 

$

 -

 

$
332,466 

 

$
4,506 

 

$
(649)

 

$
336,323 

Expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Production and disposal and related expenses

 

 -

 

 

 -

 

 
129,247 

 

 
3,895 

 

 
(649)

 

 
132,493 

Depreciation, depletion and amortization

 

 -

 

 

 -

 

 
85,439 

 

 
57 

 

 

 -

 

 
85,496 

General and administrative

 
5,125 

 

 

 -

 

 
26,273 

 

 

 -

 

 

 -

 

 
31,398 

Accretion of asset retirement obligations and acquisition and transaction costs

 

 -

 

 

 -

 

 
6,422 

 

 
44 

 

 

 -

 

 
6,466 

Total expenses

 
5,125 

 

 

 -

 

 
247,381 

 

 
3,996 

 

 
(649)

 

 
255,853 

Operating income

 
(5,125)

 

 

 -

 

 
85,085 

 

 
510 

 

 

 -

 

 
80,470 

Loss on commodity derivative contracts

 

 -

 

 

 -

 

 
(11,860)

 

 

 -

 

 

 -

 

 
(11,860)

Interest expense, net, income tax expense and other income, net

 
(22,224)

 

 

 -

 

 
(12,438)

 

 
(5)

 

 

 -

 

 
(34,667)

Equity in earnings

 
61,070 

 

 

 -

 

 
281 

 

 

 -

 

 
(61,351)

 

 

 -

Net (loss) income

 
33,721 

 

 

 -

 

 
61,068 

 

 
505 

 

 
(61,351)

 

 
33,943 

Less: Net income attributable to noncontrolling interest

 

 -

 

 

 -

 

 

 -

 

 

 -

 

 
222 

 

 
222 

Net income (loss) attributable to QR Energy, LP

$
33,721 

 

$

 -

 

$
61,068 

 

$
505 

 

$
(61,573)

 

$
33,721 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Condensed Consolidating Statements of Comprehensive Income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Parent Co-Issuer

 

 

Subsidiary Co-Issuer

 

 

Guarantor

 

 

Non-Guarantor

 

 

Eliminations

 

 

Consolidated

Three Months Ended September 30, 2013

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss)

$
(21,719)

 

$

 -

 

$
(12,538)

 

$
505 

 

$
12,255 

 

$
(21,497)

Other comprehensive income, net of tax:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Change in fair value of available-for-sale securities

 
100 

 

 

 -

 

 
100 

 

 
179 

 

 
(200)

 

 
179 

Total other comprehensive income

 
100 

 

 

 -

 

 
100 

 

 
179 

 

 
(200)

 

 
179 

Total comprehensive income (loss)

 
(21,619)

 

 

 -

 

 
(12,438)

 

 
684 

 

 
12,055 

 

 
(21,318)

Less: Comprehensive income attributable to noncontrolling interest

 

 -

 

 

 -

 

 

 -

 

 

 -

 

 
301 

 

 
301 

Comprehensive income (loss) attributable to QR Energy, LP

$
(21,619)

 

$

 -

 

$
(12,438)

 

$
684 

 

$
11,754 

 

$
(21,619)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Condensed Consolidating Statements of Comprehensive Income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Parent Co-Issuer

 

 

Subsidiary Co-Issuer

 

 

Guarantor

 

 

Non-Guarantor

 

 

Eliminations

 

 

Consolidated

Nine Months Ended September 30, 2013

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss)

$
33,721 

 

$

 -

 

$
61,068 

 

$
505 

 

$
(61,351)

 

$
33,943 

Other comprehensive income, net of tax:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Change in fair value of available-for-sale securities

 
100 

 

 

 -

 

 
100 

 

 
179 

 

 
(200)

 

 
179 

Total other comprehensive income

 
100 

 

 

 -

 

 
100 

 

 
179 

 

 
(200)

 

 
179 

Total comprehensive income (loss)

 
33,821 

 

 

 -

 

 
61,168 

 

 
684 

 

 
(61,551)

 

 
34,122 

Less: Comprehensive income attributable to noncontrolling interest

 

 -

 

 

 -

 

 

 -

 

 

 -

 

 
301 

 

 
301 

Comprehensive income (loss) attributable to QR Energy, LP

$
33,821 

 

$

 -

 

$
61,168 

 

$
684 

 

$
(61,852)

 

$
33,821 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Condensed Consolidating Statements of Cash Flows

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Parent Co-Issuer

 

 

Subsidiary Co-Issuer

 

 

Guarantor

 

 

Non-Guarantor

 

 

Eliminations

 

 

Consolidated

Nine Months Ended September 30, 2013

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net cash (used in) provided by operating activities

$
(28,050)

 

$

 -

 

$
169,511 

 

$
357 

 

$

 -

 

$
141,818 

Cash flows from investing activities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Additions to oil and natural gas properties

 

 -

 

 

 -

 

 
(65,898)

 

 

 -

 

 

 -

 

 
(65,898)

Acquisitions

 

 -

 

 

 -

 

 
(105,177)

 

 
3,481 

 

 

 -

 

 
(101,696)

Distributions from subsidiaries

 
136,449 

 

 

 -

 

 

 -

 

 

 -

 

 
(136,449)

 

 

 -

Proceeds from sale of available-for-sale securities

 

 -

 

 

 -

 

 

 -

 

 
4,643 

 

 

 -

 

 
4,643 

Purchases of available-for-sale securities

 

 -

 

 

 -

 

 

 -

 

 
(4,268)

 

 

 -

 

 
(4,268)

Net cash (used in) provided by investing activities

 
136,449 

 

 

 -

 

 
(171,075)

 

 
3,856 

 

 
(136,449)

 

 
(167,219)

Cash flows from financing activities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Distributions to unitholders

 
(106,226)

 

 

 -

 

 

 -

 

 

 -

 

 

 -

 

 
(106,226)

Proceeds from bank borrowings

 

 -

 

 

 -

 

 
150,000 

 

 

 -

 

 

 -

 

 
150,000 

Repayments on bank/intercompany borrowings

 

 -

 

 

 -

 

 
(20,000)

 

 

 -

 

 

 -

 

 
(20,000)

Repayments on intercompany borrowings

 

 -

 

 

 -

 

 
(33,213)

 

 

 -

 

 
33,213 

 

 

 -

Distributions to Parent

 

 -

 

 

 -

 

 
(103,236)

 

 

 -

 

 
103,236 

 

 

 -

Other

 
(2,241)

 

 

 -

 

 
(1,904)

 

 

 -

 

 

 -

 

 
(4,145)

Net cash (used in) provided by financing activities

 
(108,467)

 

 

 -

 

 
(8,353)

 

 

 -

 

 
136,449 

 

 
19,629 

Net increase (decrease) in cash

 
(68)

 

 

 -

 

 
(9,917)

 

 
4,213 

 

 

 -

 

 
(5,772)

Cash at beginning of period

 
68 

 

 

 -

 

 
31,768 

 

 

 -

 

 

 -

 

 
31,836 

Cash at end of period

$

 -

 

$

 -

 

$
21,851 

 

$
4,213 

 

$

 -

 

$
26,064