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Related Party Debt

12 Months Ended

Dec. 31, 2019

Consolidated related party debt obligations comprise the following as of the dates indicated:


	December 31, 2019										December 31, 2018
	Outstanding Balance		Total Capacity		Available Capacity		Outstanding Balance		Total Capacity		Available Capacity
Ten Year Fixed Facility	$	600	$	600	$	—	$	—	$	—	$	—
Seven Year Fixed Facility	600		600		—		600		600		—
Five Year Revolver due July 2023	494		760		266		494		760		266
Five Year Revolver due December 2022	400		1,000		600		400		1,000		600
Five Year Fixed Facility	600		600		—		600		600		—
2019 Zydeco Revolver ⁽¹⁾	—		30		30		—		30		30
Unamortized debt issuance costs	(2)		n/a		n/a		(3)		n/a		n/a
Debt payable – related party	$	2,692	$	3,590	$	896	$	2,091	$	2,990	$	896

⁽¹⁾ Effective August 6, 2019, the Zydeco Revolver expired. In its place, Zydeco entered into the 2019 Zydeco Revolver. See below for additional information.

Interest and fee expenses associated with our borrowings, net of capitalized interest, were $92 million, $61 million and $29 million for 2019, 2018 and 2017, respectively, of which we paid $88 million, $53 million and $25 million, respectively.

Borrowings under our revolving credit facilities approximate fair value as the interest rates are variable and reflective of market rates, which results in Level 2 instruments. The fair value of our fixed rate credit facilities is estimated based on the published market prices for issuances of similar risk and tenor and is categorized as Level 2 within the fair value hierarchy. As of December 31, 2019, the carrying amount and estimated fair value of total debt (before amortization of issuance costs) was $2,694 million and $2,825 million, respectively. As of December 31, 2018, the carrying amount and estimated fair value of total debt (before amortization of issuance costs) was $2,094 million and $2,099 million, respectively.

The Ten Year Fixed Facility was fully drawn on June 6, 2019 to partially fund the June 2019 Acquisition.

The Seven Year Fixed Facility was fully drawn on August 1, 2018 and the borrowings were used to partially repay borrowings under the Five Year Revolver due December 2022.

On May 11, 2018, we funded the May 2018 Acquisition with $494 million in borrowings under the Five Year Revolver due July 2023 and $726 million in borrowings under the Five Year Revolver due December 2022.

On February 6, 2018, we used net proceeds from sales of common units and from our general partner’s proportionate capital

contribution to repay $247 million of borrowings outstanding under our Five Year Revolver due July 2023 and $726 million

of borrowings outstanding under our Five Year Revolver due December 2022.

On December 1, 2017, we borrowed $1,000 million under the Five Year Revolver due December 2022 and $93 million under our Five Year Fixed Facility. We used $825 million of these proceeds to fund the December 2017 Acquisition and the remaining $268 million to repay borrowings outstanding under our Five Year Revolver due July 2023. Additionally, we paid $1 million of accrued interest on the repaid borrowings with cash on hand.

On September 15, 2017, we used net proceeds from sales of common units to third parties to repay $265 million of borrowings outstanding under our Five Year Revolver due July 2023.

On May 10, 2017, we funded the May 2017 Acquisition with $50 million of cash on hand, $73 million in borrowings under our Five Year Revolver due July 2023 and $507 million in borrowings under our Five Year Fixed Facility.

Credit Facility Agreements

Ten Year Fixed Facility

On June 4, 2019, we entered into a ten-year fixed rate credit facility with STCW with a borrowing capacity of $600 million (the “Ten Year Fixed Facility”). The Ten Year Fixed Facility bears an interest rate of 4.18% per annum and matures on June 4, 2029. No issuance fee was incurred in connection with the Ten Year Fixed Facility. The Ten Year Fixed Facility contains customary representations, warranties, covenants and events of default, the occurrence of which would permit the lender to accelerate the maturity date of amounts borrowed under the Ten Year Fixed Facility.

Seven Year Fixed Facility

On July 31, 2018, we entered into a seven-year fixed rate credit facility with STCW with a borrowing capacity of $600 million (the “Seven Year Fixed Facility”). We incurred an issuance fee of $1 million, which was paid on August 7, 2018. The Seven Year Fixed Facility contains customary representations, warranties, covenants and events of default, the occurrence of which would permit the lender to accelerate the maturity date of amounts borrowed under the Seven Year Fixed Facility.

The Seven Year Fixed Facility bears an interest rate of 4.06% per annum and matures on July 31, 2025.

Five Year Revolver due July 2023

On August 1, 2018, we amended and restated the five year revolving credit facility originally due October 2019 such that the facility will now mature on July 31, 2023 (the “Five Year Revolver due July 2023”). The Five Year Revolver due July 2023 has

a borrowing capacity of $760 million and will continue to bear interest at LIBOR plus a margin and we continue to pay interest of 0.19% on any unused capacity. Commitment fees began to accrue beginning on the date we entered into the agreement.

As of December 31, 2019, the annualized weighted average interest rate for the Five Year Revolver due July 2023 was 3.57%. There is no issuance fee associated with this amendment. All other material terms and conditions of the Five Year Revolver due July 2023 remain unchanged.

The Five Year Revolver due July 2023 was originally entered into on November 3, 2014, and provides that loans advanced under the facility can have a term ending on or before its maturity date.

Five Year Revolver due December 2022

On December 1, 2017, we entered into a five year revolving credit facility with STCW (the “Five Year Revolver due December 2022”) with a borrowing capacity of $1,000 million and paid an issuance fee of $2 million. Borrowings under the Five Year Revolver due December 2022 bear interest at the three-month LIBOR rate plus a margin, or, in the alternative, the percentage rate per annum which is the rate notified to us by STCW in accordance with the terms of the Five Year Revolver due December 2022 as soon as practicable and in any event before interest is due to be paid in respect of a loan. Additionally, we pay interest of 0.19% on any unused capacity. As of December 31, 2019, the weighted average interest rate for the Five Year Revolver due December 2022 was 3.76%. Commitment fees began to accrue beginning on the date we entered into the agreement. The Five Year Revolver due December 2022 matures on December 1, 2022.

Five Year Fixed Facility

On March 1, 2017, we entered into a Loan Facility Agreement with STCW with a borrowing capacity of $600 million (the “Five Year Fixed Facility”) and paid an issuance fee of $1 million. The Five Year Fixed Facility provides that we may not repay or prepay amounts borrowed without the consent of the lender and amounts repaid or prepaid may not be re-borrowed.

The Five Year Fixed Facility bears a fixed interest rate of 3.23% per annum. The Five Year Fixed Facility matures on March 1, 2022.

Zydeco Revolving Credit Facility Agreement

On August 6, 2019, the Zydeco Revolver expired. On August 1, 2019, Zydeco entered into a senior unsecured revolving loan facility agreement with STCW, effective August 6, 2019 (the “2019 Zydeco Revolver”). The 2019 Zydeco Revolver has a borrowing capacity of $30 million and matures on August 6, 2024. Borrowings under the credit facility bear interest at the three-month LIBOR rate plus a margin, or, in certain instances, including if LIBOR is discontinued, STCW may specify another benchmark rate generally accepted in the loan market to apply in relation to the advances in place of LIBOR. No issuance fee was incurred in connection with the 2019 Zydeco Revolver. As of December 31, 2019, the interest rate for the 2019 Zydeco Revolver was 2.59%.

Covenants

Under the Ten Year Fixed Facility, the Seven Year Fixed Facility, the Five Year Revolver due July 2023, the Five Year Revolver due December 2022, the Five Year Fixed Facility, and the 2019 Zydeco Revolver, we (and Zydeco in the case of the 2019 Zydeco Revolver) have, among other things:

•agreed to restrict additional indebtedness not loaned by STCW;

•to give the applicable facility pari passu ranking with any new indebtedness; and

•to refrain from securing our assets except as agreed with STCW.

These facilities also contain customary events of default, such as nonpayment of principal, interest and fees when due and violation of covenants, as well as cross-default provisions under which a default under one credit facility may trigger an event of default in another facility with the same borrower. Any breach of covenants included in our debt agreements which could result in our related party lender demanding payment of the unpaid principal and interest balances will have a material adverse effect upon us and would likely require us to seek to renegotiate these debt arrangements with our related party lender and/or obtain new financing from other sources. As of December 31, 2019, we were in compliance with the covenants contained in the Ten Year Fixed Facility, and as of December 31, 2019 and 2018, we were in compliance with the covenants contained in the Seven Year Fixed Facility, the Five Year Revolver due July 2023, the Five Year Revolver due December 2022 and the Five Year Fixed Facility, and Zydeco was in compliance with the covenants contained in the 2019 Zydeco Revolver.

Borrowings and repayments under our credit facilities for 2019, 2018 and 2017 are disclosed in our consolidated statements of cash flows. See Note 3 — Acquisitions and Divestiture for additional information regarding our use of borrowings. See Note 11 — (Deficit) Equity for additional information regarding the source of our repayments.