PARTNERS' CAPITAL

3 Months Ended

Mar. 31, 2014

Partners' Capital Notes [Abstract]

PARTNERS' CAPITAL

PARTNERS’ CAPITAL

Common Units

In February 2014, we completed a public equity offering of 9,200,000 additional common units and we received a capital contribution from our General Partner to maintain its 2.0% interest in us. The net proceeds from the public offering of common units were $144.7 million. The net proceeds from the offering are being used to fund the construction of our new pipeline extending into Webb County, Texas, were used for our acquisition in March 2014 and are being used for general partnership purposes. Pending use of the funds, we temporarily repaid borrowings under our Credit Facility, which we are redrawing to fund the construction of the new pipeline and for other general purposes.

Our common units represent limited partner interests in us. The holders of our common units are entitled to participate in partnership distributions and are entitled to exercise the rights and privileges available to limited partners under our Partnership Agreement. We had 21,454,119 and 12,253,985 common units issued and outstanding as of March 31, 2014 and December 31, 2013, respectively.

Subordinated Units

Subordinated units represent limited partner interests in us and convert to common units at the end of the subordination period (as defined in our Partnership Agreement). The principal difference between our common units and our subordinated units is that in any quarter during the subordination period, holders of the subordinated units are not entitled to receive any distribution of available cash until the common units have received the minimum quarterly distribution plus any arrearages in the payment of the minimum quarterly distribution from prior quarters. Subordinated units do not accrue arrearages. We had 12,213,713 subordinated units issued and outstanding as of March 31, 2014 and December 31, 2013.

General Partner Interests

Our general partner interest consisted of 723,852 general partner units as of March 31, 2014 and 534,638 general partner units as of December 31, 2013. In connection with other equity issuances, our General Partner has made capital contributions in exchange for an issuance of additional general partner units to maintain its 2.0% ownership interest in us. Also, the General Partner has received general partner unit PIK distributions from the general partner units purchased in connection with the Private Placement (See Note 3).