VARIABLE INTEREST ENTITIES

6 Months Ended

Jun. 30, 2018

VARIABLE INTEREST ENTITIES

VARIABLE INTEREST ENTITIES

VARIABLE INTEREST ENTITIES

Spectra Energy Partners, LP (SEP) owns a 50% interest in Sabal Trail Transmission, LLC (Sabal Trail), a joint venture that operates a pipeline originating in Alabama that transports natural gas to Florida and has been classified as a variable interest entity.

On April 30, 2018, Sabal Trail issued US$500 million in aggregate principal amount of 4.246% senior notes due in 2028, US$600 million in aggregate principal amount of 4.682% senior notes due in 2038 and US$400 million in aggregate principal amount of 4.832% senior notes due in 2048. Sabal Trail distributed net proceeds from the offering to the partners as a partial reimbursement of construction and development costs incurred by the partners. The net distribution made to SEP was US$744 million and was used to pay down indebtedness and is included within Distributions from equity investments in excess of cumulative earnings on the Consolidated Statement of Cash Flows for the six months ended June 30, 2018.

As at June 30, 2018, Sabal Trail is no longer a variable interest entity due to sufficient equity at risk to finance its activities based on reconsideration events related to Sabal Trail's debt issuance and the distributions made to its partners.