Quarterly Report (10-q)

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q



ý	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2015



¨	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 1-33556

SPECTRA ENERGY PARTNERS, LP

(Exact Name of Registrant as Specified in its Charter)



Delaware		41-2232463
(State or other jurisdiction of incorporation)		(IRS Employer Identification No.)

5400 Westheimer Court

Houston, Texas 77056

(Address of principal executive offices, including zip code)

713-627-5400

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ý No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ý Accelerated filer ¨ Non-accelerated filer ¨ Smaller reporting company ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No ý

At September 30, 2015, there were 301,976,934 Common Units and 6,162,795 General Partner Units outstanding.

SPECTRA ENERGY PARTNERS, LP

FORM 10-Q FOR THE QUARTER ENDED

September 30, 2015

INDEX




		Page
PART I. FINANCIAL INFORMATION

Item 1.	Financial Statements (Unaudited)	4

	Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2015 and 2014	4

	Condensed Consolidated Statements of Comprehensive Income for the three and nine months ended September 30, 2015 and 2014	5

	Condensed Consolidated Balance Sheets as of September 30, 2015 and December 31, 2014	6

	Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2015 and 2014	8

	Condensed Consolidated Statements of Equity for the nine months ended September 30, 2015 and 2014	9

	Notes to Condensed Consolidated Financial Statements	10

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	18

Item 3.	Quantitative and Qualitative Disclosures about Market Risk	28

Item 4.	Controls and Procedures	28

PART II. OTHER INFORMATION

Item 1.	Legal Proceedings	29

Item 1A.	Risk Factors	29

Item 6.	Exhibits	29

	Signatures	31

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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION

This document includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements represent management’s intentions, plans, expectations, assumptions and beliefs about future events. These forward-looking statements are identified by terms and phrases such as: anticipate, believe, intend, estimate, expect, continue, should, could, may, plan, project, predict, will, potential, forecast, and similar expressions. Forward-looking statements are subject to risks, uncertainties and other factors, many of which are outside our control and could cause actual results to differ materially from the results expressed or implied by those forward-looking statements. Factors used to develop these forward-looking statements and that could cause actual results to differ materially from those indicated in any forward-looking statement include, but are not limited to:


•	state, provincial, federal and foreign legislative and regulatory initiatives that affect cost and investment recovery, have an effect on rate structure, and affect the speed at and degree to which competition enters the natural gas and oil industries;


•	outcomes of litigation and regulatory investigations, proceedings or inquiries;


•	weather and other natural phenomena, including the economic, operational and other effects of hurricanes and storms;


•	the timing and extent of changes in interest rates and foreign currency exchange rates;


•	general economic conditions, including the risk of a prolonged economic slowdown or decline, or the risk of delay in a recovery, which can affect the long-term demand for natural gas and oil and related services;


•	potential effects arising from terrorist attacks and any consequential or other hostilities;


•	changes in environmental, safety and other laws and regulations;


•	the development of alternative energy resources;


•	results and costs of financing efforts, including the ability to obtain financing on favorable terms, which can be affected by various factors, including credit ratings and general market and economic conditions;


•	increases in the cost of goods and services required to complete capital projects;


•	growth in opportunities, including the timing and success of efforts to develop U.S. and Canadian pipeline, storage, gathering and other related infrastructure projects and the effects of competition;


•	the performance of natural gas transmission, storage and gathering facilities, and crude oil transportation and storage;


•	the extent of success in connecting natural gas and oil supplies to transmission and gathering systems and in connecting to expanding gas and oil markets;


•	the effects of accounting pronouncements issued periodically by accounting standard-setting bodies;


•	conditions of the capital markets during the periods covered by forward-looking statements; and


•	the ability to successfully complete merger, acquisition or divestiture plans; regulatory or other limitations imposed as a result of a merger, acquisition or divestiture; and the success of the business following a merger, acquisition or divestiture.

In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements might not occur or might occur to a different extent or at a different time than Spectra Energy Partners, LP has described. Spectra Energy Partners, LP undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

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PART I. FINANCIAL INFORMATION

Item 1. Financial Statements.

SPECTRA ENERGY PARTNERS, LP

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

(In millions, except per-unit amounts)



	Three Months Ended September 30,				Nine Months Ended September 30,
	2015		2014		2015		2014
Operating Revenues
Transportation of natural gas	$	461	$	409	$	1,379	$	1,237
Transportation of crude oil	93		77		267		218
Storage of natural gas and other	58		72		175		215
Total operating revenues	612		558		1,821		1,670
Operating Expenses
Operating, maintenance and other	184		175		543		497
Depreciation and amortization	74		73		220		216
Property and other taxes	35		30		106		120
Total operating expenses	293		278		869		833
Operating Income	319		280		952		837
Other Income and Expenses
Earnings from equity investments	49		36		134		93
Other income and expenses, net	23		10		49		19
Total other income and expenses	72		46		183		112
Interest Expense	59		54		179		183
Earnings Before Income Taxes	332		272		956		766
Income Tax Expense	1		1		8		29
Net Income	331		271		948		737
Net Income—Noncontrolling Interests	10		7		27		16
Net Income—Controlling Interests	$	321	$	264	$	921	$	721
Calculation of Limited Partners’ Interest in Net Income:
Net income—Controlling Interests	$	321	$	264	$	921	$	721
Less: General partner’s interest in net income	66		48		184		135
Limited partners’ interest in net income	$	255	$	216	$	737	$	586
Weighted-average limited partner units outstanding—basic and diluted	301		288		297		286
Net income per limited partner unit—basic and diluted	$	0.85	$	0.75	$	2.48	$	2.05
Distributions paid per limited partner unit	$	0.61375	$	0.56625	$	1.80375	$	1.66875

See Notes to Condensed Consolidated Financial Statements.

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SPECTRA ENERGY PARTNERS, LP

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

(In millions)



	Three Months Ended September 30,						Nine Months Ended September 30,
	2015			2014			2015			2014
Net Income	$	331		$	271		$	948		$	737
Other comprehensive loss:
Foreign currency translation adjustments	(10		)	(9		)	(23		)	(8		)
Total other comprehensive loss	(10		)	(9		)	(23		)	(8		)
Total Comprehensive Income	321			262			925			729
Less: Comprehensive Income—Noncontrolling Interests	10			7			27			16
Comprehensive Income—Controlling Interests	$	311		$	255		$	898		$	713

See Notes to Condensed Consolidated Financial Statements.

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SPECTRA ENERGY PARTNERS, LP

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In millions)



	September 30, 2015		December 31, 2014
ASSETS
Current Assets
Cash and cash equivalents	$	291	$	140
Receivables, net	299		306
Inventory	41		42
Fuel tracker	56		44
Other	33		23
Total current assets	720		555
Investments and Other Assets
Investments in and loans to unconsolidated affiliates	1,619		1,589
Goodwill	3,234		3,244
Other	45		8
Total investments and other assets	4,898		4,841
Property, Plant and Equipment
Cost	16,778		15,594
Less accumulated depreciation and amortization	3,569		3,459
Net property, plant and equipment	13,209		12,135
Regulatory Assets and Deferred Debits	297		262
Total Assets	$	19,124	$	17,793

See Notes to Condensed Consolidated Financial Statements.

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SPECTRA ENERGY PARTNERS, LP

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In millions)



	September 30, 2015			December 31, 2014
LIABILITIES AND EQUITY
Current Liabilities
Accounts payable	$	414		$	246
Commercial paper	—			907
Taxes accrued	66			63
Interest accrued	36			60
Current maturities of long-term debt	287			36
Other	511			170
Total current liabilities	1,314			1,482
Long-term Debt	5,891			5,149
Deferred Credits and Other Liabilities
Deferred income taxes	38			37
Regulatory and other	127			119
Total deferred credits and other liabilities	165			156
Commitments and Contingencies
Equity
Partners’ Capital
Common units (302.0 million and 294.7 million units issued and outstanding at September 30, 2015 and December 31, 2014, respectively)	11,025			10,474
General partner units (6.2 million and 6.0 million units issued and outstanding at September 30, 2015 and December 31, 2014, respectively)	332			284
Accumulated other comprehensive loss	(43		)	(20		)
Total partners’ capital	11,314			10,738
Noncontrolling interests	440			268
Total equity	11,754			11,006
Total Liabilities and Equity	$	19,124		$	17,793

See Notes to Condensed Consolidated Financial Statements.

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SPECTRA ENERGY PARTNERS, LP

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(In millions)



	Nine Months Ended September 30,
	2015			2014
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$	948		$	737
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	226			223
Deferred income tax expense	2			25
Earnings from equity investments	(134		)	(93		)
Distributions received from unconsolidated affiliates	146			92
Other	(58		)	(71		)
Net cash provided by operating activities	1,130			913
CASH FLOWS FROM INVESTING ACTIVITIES
Capital expenditures	(1,161		)	(755		)
Investments in and loans to unconsolidated affiliates	(91		)	(134		)
Purchases of held-to-maturity securities	(33		)	(31		)
Proceeds from sales and maturities of held-to-maturity securities	25			24
Distributions received from unconsolidated affiliates	440			150
Other changes in restricted funds	(15		)	—
Other	—			1
Net cash used in investing activities	(835		)	(745		)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from the issuance of long-term debt	994			—
Payments for the redemption of long-term debt	(16		)	(427		)
Net increase (decrease) in commercial paper	(907		)	475
Distributions to noncontrolling interests	(23		)	(22		)
Contributions from noncontrolling interests	164			139
Proceeds from the issuances of units	358			283
Distributions to partners	(705		)	(601		)
Other	(9		)	—
Net cash used in financing activities	(144		)	(153		)
Net increase in cash and cash equivalents	151			15
Cash and cash equivalents at beginning of period	140			121
Cash and cash equivalents at end of period	$	291		$	136
Supplemental Disclosures
Property, plant and equipment non-cash accruals	$	202		$	106

See Notes to Condensed Consolidated Financial Statements.

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SPECTRA ENERGY PARTNERS, LP

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

(Unaudited)

(In millions)



	Partners’ Capital									Noncontrolling Interests			Total
	Common			General Partner			Accumulated Other Comprehensive Loss			Noncontrolling Interests			Total
December 31, 2014	$	10,474		$	284		$	(20	)	$	268		$	11,006
Net income	737			184			—			27			948
Other comprehensive loss	—			—			(23		)	—			(23		)
Attributed deferred tax benefit	—			25			—			4			29
Issuances of units	351			7			—			—			358
Distributions to partners	(537		)	(168		)	—			—			(705		)
Contributions from noncontrolling interests	—			—			—			164			164
Distributions to noncontrolling interests	—			—			—			(23		)	(23		)
September 30, 2015	$	11,025		$	332		$	(43	)	$	440		$	11,754
December 31, 2013	$	9,778		$	241		$	(5	)	$	127		$	10,141
Net income	586			135			—			16			737
Other comprehensive loss	—			—			(8		)	—			(8		)
Adjustment to purchase price under net acquired assets from dropdowns	11			—			—			—			11
Attributed deferred tax benefit	—			9			—			1			10
Issuances of units	277			6			—			—			283
Distributions to partners	(478		)	(123		)	—			—			(601		)
Contributions from noncontrolling interests	—			—			—			139			139
Distributions to noncontrolling interests	—			—			—			(22		)	(22		)
Other, net	(2		)	—			—			—			(2		)
September 30, 2014	$	10,172		$	268		$	(13	)	$	261		$	10,688

See Notes to Condensed Consolidated Financial Statements.

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SPECTRA ENERGY PARTNERS, LP

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1. General

The terms “we,” “our,” “us” and “Spectra Energy Partners” as used in this report refer collectively to Spectra Energy Partners, LP and its subsidiaries unless the context suggests otherwise. These terms are used for convenience only and are not intended as a precise description of any separate legal entity within Spectra Energy Partners.

Nature of Operations. Spectra Energy Partners, through its subsidiaries and equity affiliates, is engaged in the transmission, storage and gathering of natural gas, the transportation and storage of crude oil, and the transportation of natural gas liquids (NGLs) through interstate pipeline systems. We are a Delaware master limited partnership. As of September 30, 2015, Spectra Energy Corp (Spectra Energy) and its subsidiaries collectively owned 80% of us and the remaining 20% was publicly owned.

Basis of Presentation. The accompanying Condensed Consolidated Financial Statements include our accounts and the accounts of our majority-owned subsidiaries, after eliminating intercompany transactions and balances. These interim financial statements should be read in conjunction with the consolidated financial statements included in our Annual Report on Form 10-K, for the year ended December 31, 2014, and reflect all normal recurring adjustments that are, in our opinion, necessary to fairly present our results of operations and financial position. Amounts reported in the Condensed Consolidated Statements of Operations are not necessarily indicative of amounts expected for the respective annual periods.

Spectra Energy and its affiliates are solely responsible for providing the employees and other personnel necessary to conduct our operations. Our costs of doing business have been reflected in our financial accounting records for the periods presented. These costs include direct charges and allocations from Spectra Energy and its affiliates for business services, such as payroll, accounts payable and facilities management; corporate services, such as finance and accounting, legal, human resources, investor relations, public and regulatory policy, and senior executives; and pension and other post-retirement benefit costs.

Use of Estimates. To conform with generally accepted accounting principles (GAAP) in the United States, we make estimates and assumptions that affect the amounts reported in the Condensed Consolidated Financial Statements and Notes to Condensed Consolidated Financial Statements. Although these estimates are based on our best available knowledge at the time, actual results could differ.

2. Business Segments

We manage our business in two reportable segments: U.S. Transmission and Liquids. The remainder of our business operations is presented as “Other,” and consists of certain corporate costs.

Our chief operating decision maker regularly reviews financial information about both segments in deciding how to allocate resources and evaluate performance. There is no aggregation of segments within our reportable business segments.

The U.S. Transmission segment provides interstate transmission and storage of natural gas. Substantially all of our operations are subject to the Federal Energy Regulatory Commission (FERC) and the Department of Transportation’s (DOT’s) rules and regulations. Our investments in Gulfstream Natural Gas System, LLC (Gulfstream), Southeast Supply Header, LLC (SESH) and Steckman Ridge, LP are included in U.S. Transmission.

The Liquids segment provides transportation of crude oil and NGLs. These operations are primarily subject to the rules and regulations of the FERC, the DOT and the National Energy Board (NEB). The Express-Platte pipeline system (Express-Platte) and our investments in DCP Sand Hills Pipeline, LLC (Sand Hills) and DCP Southern Hills Pipeline, LLC (Southern Hills) are included in Liquids.

Our reportable segments offer different products and services and are managed separately as business units. Management evaluates segment performance based on earnings from continuing operations before interest, taxes, and depreciation and amortization (EBITDA). Cash, cash equivalents and short-term investments are managed centrally, so the associated gains and losses from foreign currency remeasurement, and interest and dividend income are excluded from the segments’ EBITDA. Our segment EBITDA may not be comparable to similarly titled measures of other companies because other companies may not calculate EBITDA in the same manner.

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Business Segment Data



Condensed Consolidated Statements of Operations	Total Operating Revenues		Depreciation and Amortization		Segment EBITDA/Consolidated Earnings Before Income Taxes
	(in millions)
Three Months Ended September 30, 2015
U.S. Transmission	$	515	$	67	$	401
Liquids	97		7		79
Total reportable segments	612		74		480
Other	—		—		(13		)
Depreciation and amortization	—		—		74
Interest expense	—		—		59
Interest income and other	—		—		(2		)
Total consolidated	$	612	$	74	$	332
Three Months Ended September 30, 2014
U.S. Transmission	$	477	$	64	$	352
Liquids	81		9		60
Total reportable segments	558		73		412
Other	—		—		(11		)
Depreciation and amortization	—		—		73
Interest expense	—		—		54
Interest income and other	—		—		(2		)
Total consolidated	$	558	$	73	$	272
Nine Months Ended September 30, 2015
U.S. Transmission	$	1,546	$	197	$	1,186
Liquids	275		23		221
Total reportable segments	1,821		220		1,407
Other	—		—		(48		)
Depreciation and amortization	—		—		220
Interest expense	—		—		179
Interest income and other	—		—		(4		)
Total consolidated	$	1,821	$	220	$	956
Nine Months Ended September 30, 2014
U.S. Transmission	$	1,431	$	192	$	1,046
Liquids	239		24		169
Total reportable segments	1,670		216		1,215
Other	—		—		(48		)
Depreciation and amortization	—		—		216
Interest expense	—		—		183
Interest income and other	—		—		(2		)
Total consolidated	$	1,670	$	216	$	766

3. Transaction with Affiliate

During the third quarter of 2015, Gulfstream issued unsecured debt of $800 million to fund the repayment of its current debt. Gulfstream distributed $396 million of proceeds to us, which we will contribute back to Gulfstream as its current debt

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matures, $248 million in the fourth quarter of 2015 and the remaining $148 million in the first half of 2016. At September 30, 2015, our Condensed Consolidated Balance Sheets include $396 million in Current Liabilities - Other related to this matter.

4. Net Income Per Limited Partner Unit and Cash Distributions

The following table presents our net income per limited partner unit calculations:



	Three Months Ended September 30,				Nine Months Ended September 30,
	2015		2014		2015		2014
	(in millions, except per unit amounts)
Net income—controlling interests	$	321	$	264	$	921	$	721
Less:
General partner’s interest in net income—2%	6		6		18		15
General partner’s interest in net income attributable to incentive distribution rights	60		42		166		120
Limited partners’ interest in net income	$	255	$	216	$	737	$	586
Weighted average limited partner units outstanding—basic and diluted	301		288		297		286
Net income per limited partner unit—basic and diluted	$	0.85	$	0.75	$	2.48	$	2.05

Our partnership agreement requires that, within 60 days after the end of each quarter, we distribute all of our Available Cash, as defined, to unitholders of record on the applicable record date.

Available Cash. Available Cash, for any quarter, consists of all cash and cash equivalents on hand at the end of that quarter:


•	less the amount of cash reserves established by the general partner to:


•	provide for the proper conduct of business,


•	comply with applicable law, any debt instrument or other agreement, or


•	provide funds for minimum quarterly distributions to the unitholders and to the general partner for any one or more of the next four quarters,


•	plus, if the general partner so determines, all or a portion of cash and cash equivalents on hand on the date of determination of Available Cash for the quarter.

Incentive Distribution Rights. The general partner holds incentive distribution rights beyond the first target distribution in accordance with the partnership agreement as follows:



	Total Quarterly Distribution	Marginal Percentage Interest in Distributions
	Target Per-Unit Amount	Common Unitholders		General Partner
Minimum Quarterly Distribution	$0.30	98	%	2	%
First Target Distribution	up to $0.345	98	%	2	%
Second Target Distribution	above $0.345 up to $0.375	85	%	15	%
Third Target Distribution	above $0.375 up to $0.45	75	%	25	%
Thereafter	above $0.45	50	%	50	%

To the extent these incentive distributions are made to the general partner, there will be more Available Cash proportionately allocated to our general partner than to holders of common units. A cash distribution of $0.62625 per limited partner unit was declared on October 19, 2015 and is payable on November 25, 2015 to unitholders of record at the close of business on October 29, 2015.

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5. Goodwill

We perform our goodwill impairment test annually and evaluate goodwill when events or changes in circumstances indicate that its carrying value may not be recoverable. We completed our annual goodwill impairment test as of April 1, 2015 and no impairments were identified.

We perform our annual review for goodwill impairment at the reporting unit level, which is identified by assessing whether the components of our operating segments constitute businesses for which discrete financial information is available, whether segment management regularly reviews the operating results of those components and whether the economic and regulatory characteristics are similar. We determined that our reporting units are equivalent to our reportable segments.

As permitted under accounting guidance on testing goodwill for impairment, we perform either a qualitative assessment or a quantitative assessment of each of our reporting units based on management’s judgment. With respect to our qualitative assessments, we consider events and circumstances specific to us, such as macroeconomic conditions, industry and market considerations, cost factors and overall financial performance, when evaluating whether it is more likely than not that the fair values of our reporting units are less than their respective carrying amounts.

6. Marketable Securities and Restricted Funds

We routinely invest excess cash and various restricted balances in securities such as commercial paper, bankers acceptances, corporate debt securities, treasury bills and money market funds in the United States. We do not purchase marketable securities for speculative purposes, therefore we do not have any securities classified as trading securities. Initial investments in securities are classified as purchases of the respective type of securities (available-for-sale marketable securities or held-to-maturity (HTM) marketable securities). Maturities of securities are classified within proceeds from sales and maturities of securities in the Condensed Consolidated Statements of Cash Flows.

HTM Securities. All of our HTM securities are restricted funds. We had $11 million and $3 million of money market securities classified as Current Assets - Other on the Condensed Consolidated Balance Sheets as of September 30, 2015 and December 31, 2014, respectively. These securities are restricted pursuant to certain Express-Platte debt agreements.

At September 30, 2015, the weighted-average contractual maturity of outstanding HTM securities was less than one year.

There were no material gross unrecognized holding gains or losses associated with investments in HTM securities at September 30, 2015 or December 31, 2014.

Other Restricted Funds. In addition to the HTM securities that were restricted funds as described above, we had other restricted funds totaling $15 million at September 30, 2015 classified as Investments and Other Assets - Other. These restricted funds are related to certain construction projects. Changes in restricted balances are presented within Cash Flows from Investing Activities on our Condensed Consolidated Statements of Cash Flows.

7. Debt and Credit Facility

Available Credit Facility and Restricted Debt Covenants



	Expiration Date	Total Credit Facility Capacity		Commercial Paper Outstanding at September 30, 2015		Available Credit Facility Capacity
		(in millions)
Spectra Energy Partners, LP	2019	$	2,000	$	—	$	2,000

The issuances of commercial paper, letters of credit and revolving borrowings reduce the amount available under the credit facility. As of September 30, 2015, there were no letters of credit issued or revolving borrowings outstanding under the credit facility.

Our credit agreements contain various covenants, including the maintenance of a consolidated leverage ratio, as defined in the agreements. Failure to meet those covenants beyond applicable grace periods could result in accelerated due dates and/or termination of the agreements. As of September 30, 2015, we were in compliance with those covenants. In addition, our credit agreements allow for acceleration of payments or termination of the agreements due to nonpayment, or in some cases, due to the acceleration of our other significant indebtedness or other significant indebtedness of some of our subsidiaries. Our debt

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and credit agreements do not contain provisions that trigger an acceleration of indebtedness based solely on the occurrence of a material adverse change in our financial condition or results of operations.

As noted above, the terms of our credit agreements require us to maintain a ratio of total Consolidated Indebtedness-to-Consolidated EBITDA, as defined in the agreement, of 5.0 to 1 or less. As of September 30, 2015, this ratio was 3.4 to 1.

Debt Issuances. On March 12, 2015, we issued $1.0 billion aggregate principal amount of senior unsecured notes, comprised of $500 million of 3.50% senior notes due in 2025 and $500 million of 4.50% senior notes due in 2045. Net proceeds from the offering were used to repay a portion of outstanding commercial paper, to fund capital expenditures and for general partnership purposes.

8. Fair Value Measurements

The following presents, for each of the fair value hierarchy levels, assets that are measured at fair value on a recurring basis. There were no liabilities measured at fair value on a recurring basis at September 30, 2015 and December 31, 2014.



Description	Condensed Consolidated Balance Sheet Caption	September 30, 2015
Description	Condensed Consolidated Balance Sheet Caption	Total		Level 1		Level 2		Level 3
		(in millions)
Corporate debt securities	Cash and cash equivalents	$	226	$	—	$	226	$	—
Interest rate swaps	Investments and other assets — other	26		—		26		—
Total Assets		$	252	$	—	$	252	$	—



Description	Condensed Consolidated Balance Sheet Caption	December 31, 2014
Description	Condensed Consolidated Balance Sheet Caption	Total		Level 1		Level 2		Level 3
		(in millions)
Corporate debt securities	Cash and cash equivalents	$	43	$	—	$	43	$	—
Interest rate swaps	Investments and other assets — other	5		—		5		—
Total Assets		$	48	$	—	$	48	$	—

Level 1

Level 1 valuations represent quoted unadjusted prices for identical instruments in active markets.

Level 2 Valuation Techniques

Fair values of our financial instruments that are actively traded in the secondary market, including our long-term debt, are determined based on market-based prices. These valuations may include inputs such as quoted market prices of the exact or similar instruments, broker or dealer quotations, or alternative pricing sources that may include models or matrix pricing tools, with reasonable levels of price transparency.

For interest rate swaps, we utilize data obtained from a third-party source for the determination of fair value. Both the future cash flows for the fixed-leg and floating-leg of our swaps are discounted to present value.

Level 3 Valuation Techniques

Level 3 valuation techniques include the use of pricing models, discounted cash flow methodologies or similar techniques where at least one significant model assumption or input is unobservable. Level 3 financial instruments also include those for which the determination of fair value requires significant management judgment or estimation.

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Financial Instruments

The fair values of financial instruments that are recorded and carried at book value are summarized in the following table. Judgment is required in interpreting market data to develop the estimates of fair value. These estimates are not necessarily indicative of the amounts we could have realized in current markets.



	September 30, 2015				December 31, 2014
	Book Value		Approximate Fair Value		Book Value		Approximate Fair Value
	(in millions)
Note receivable, noncurrent (a)	$	71	$	71	$	71	$	71
Long-term debt, including current maturities (b)	6,169		6,217		5,184		5,554

________


(a)	Included within Investments in and Loans to Unconsolidated Affiliates.


(b)	Excludes unamortized items and fair value hedge carrying value adjustments.

The fair value of our long-term debt is determined based on market-based prices as described in the Level 2 valuation technique described above and is classified as Level 2.

The fair values of cash and cash equivalents, restricted cash, short-term investments, accounts receivable, note receivable-noncurrent, accounts payable, commercial paper and short-term money market securities - affiliates are not materially different from their carrying amounts because of the short-term nature of these instruments or because the stated rates approximate market rates.

During the nine months ended September 30, 2015 and 2014, there were no material adjustments to assets and liabilities measured at fair value on a nonrecurring basis.

9. Risk Management and Hedging Activities

Changes in interest rates expose us to risk as a result of our issuance of variable and fixed-rate debt and commercial paper. We are exposed to foreign currency risk from the Canadian portion of Express-Platte (Express Canada). We employ established policies and procedures to manage our risks associated with these market fluctuations, which may include the use of derivatives, mostly around interest rate exposures. For interest rate derivative instruments that are designated and qualify as fair value hedges, the gain or loss on the derivative as well as the offsetting loss or gain on the hedged item attributable to the hedged risk is recognized in the Condensed Consolidated Statements of Operations. There were no significant amounts of gains or losses recognized in net income during the nine months ended September 30, 2015.

At September 30, 2015, we had “pay floating — receive fixed” interest rate swaps outstanding with a total notional amount of $900 million to hedge against changes in the fair value of our fixed-rate debt that arise as a result of changes in market interest rates. These swaps also allow us to transform a portion of the underlying interest payments related to our long-term fixed-rate debt securities into variable-rate interest payments in order to achieve our desired mix of fixed and variable-rate debt.

Information about our interest rate swaps that had netting or rights of offset arrangements are as follows:



	September 30, 2015						December 31, 2014
	Gross Amounts Presented in the Condensed Consolidated Balance Sheets		Amounts Not Offset in the Condensed Consolidated Balance Sheets		Net Amount		Gross Amounts Presented in the Condensed Consolidated Balance Sheets		Amounts Not Offset in the Condensed Consolidated Balance Sheets		Net Amount
Description	(in millions)
Assets	$	26	$	—	$	26	$	5	$	—	$	5

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10. Commitments and Contingencies

Environmental

We are subject to various U.S. federal, state and local laws and regulations, as well as Canadian federal and provincial laws, regarding air and water quality, hazardous and solid waste disposal and other environmental matters. These laws and regulations can change from time to time, imposing new obligations on us.

Like others in the energy industry, we and our affiliates are responsible for environmental remediation at various contaminated sites. These include some properties that are part of our ongoing operations, sites formerly owned or used by us, and sites owned by third parties. Remediation typically involves management of contaminated soils and may involve groundwater remediation. Managed in conjunction with relevant federal, state/provincial and local agencies, activities vary with site conditions and locations, remedial requirements, complexity and sharing of responsibility. If remediation activities involve statutory joint and several liability provisions, strict liability, or cost recovery or contribution actions, we or our affiliates could potentially be held responsible for contamination caused by other parties. In some instances, we may share liability associated with contamination with other potentially responsible parties, and may also benefit from contractual indemnities that cover some or all cleanup costs. All of these sites generally are managed in the normal course of business or affiliated operations. We believe there are no matters outstanding that upon resolution will have a material effect on our consolidated results of operations, financial position or cash flows.

Litigation

Litigation and Legal Proceedings. We are involved in legal, tax and regulatory proceedings in various forums arising in the ordinary course of business, including matters regarding contract and payment claims, some of which involve substantial monetary amounts. We have insurance coverage for certain of these losses should they be incurred. We believe that the final disposition of these proceedings will not have a material effect on our consolidated results of operations, financial position or cash flows.

Legal costs related to the defense of loss contingencies are expensed as incurred. We had no material reserves for legal matters recorded as of September 30, 2015 or December 31, 2014 related to litigation.

11. Issuances of Common Units

During the nine months ended September 30, 2015, we issued 7.3 million common units to the public under our at-the-market program, and approximately 149,000 general partner units to Spectra Energy. Total net proceeds were $358 million, including approximately $7 million of proceeds from Spectra Energy.

12. New Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” which supersedes the revenue recognition requirements of “Revenue Recognition (Topic 605)” and clarifies the principles of recognizing revenue. In July 2015, the FASB decided to defer the effective date of the new revenue standard for one year and to permit entities to early adopt the standard as of the original effective date. This ASU is effective for us January 1, 2018. We are currently evaluating this ASU and its potential impact on us.

In February 2015, the FASB issued ASU No. 2015-02, “Consolidation (Topic 810): Amendments to the Consolidation Analysis,” which makes changes to both the variable interest model and the voting model. These changes will require re-evaluation of certain entities for consolidation and will require us to revise our documentation regarding the consolidation or deconsolidation of such entities. ASU No. 2015-02 is effective for us January 1, 2016. We are currently evaluating this ASU and its potential impact on us.

In April 2015, the FASB issued ASU No. 2015-03, “Interest-Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs,” which requires that debt issuance costs be presented in the balance sheet as a direct deduction from the carrying amount of the related debt liability, rather than as a deferred charge asset. ASU No. 2015-03 is effective for us January 1, 2016 and is to be applied retrospectively. We intend to early adopt the provisions of this ASU as of December 31, 2015. This ASU is not expected to have a material impact on our consolidated results of operations, financial position or cash flow.

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In April 2015, the FASB issued ASU No. 2015-06, “Earnings Per Share (Topic 260): Effects on Historical Earnings per Unit of Master Limited Partnership Dropdown Transactions (a consensus of the FASB Emerging Issues Task Force),” which applies to master limited partnerships that receive net assets through a dropdown transaction. ASU 2015-06 specifies that for purposes of calculating historical earnings per unit under the two-class method, the earnings (losses) of a transferred business before the date of a dropdown transaction should be allocated entirely to the general partner. Qualitative disclosures about how the rights to the earnings (losses) differ before and after the dropdown transaction occurs for purposes of computing earnings per unit under the two-class method also are required. ASU 2015-06 is effective for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years and will be applied retrospectively. We intend to early adopt the provisions of this ASU as of December 31, 2015. We are currently evaluating this ASU and its potential impact on us.

In July 2015, the FASB issued ASU No. 2015-11, “Inventory (Topic 330): Simplifying the Measurement of Inventory,” which simplifies the subsequent measurement of inventory by requiring inventory to be measured at the lower of cost and net realizable value. This ASU is effective for us January 1, 2016. This ASU is not expected to have a material impact on our consolidated results of operations, financial position or cash flow.

In September 2015, the FASB issued ASU No. 2015-16, “Business Combinations (Topic 805): Simplifying the Accounting for Measurement-Period Adjustments,” to simplify accounting for adjustments made to provisional amounts recognized in a business combination and to eliminate the retrospective accounting for those adjustments. This ASU is effective for us January 1, 2016. This ASU is not expected to have a material impact on our consolidated results of operations, financial position or cash flow.

13. Subsequent Events

On October 18, 2015, we entered into a definitive agreement with Spectra Energy to acquire our 33.3% ownership interests in Sand Hills and Southern Hills. In consideration for this transaction, we retired 21,560,000 of our common units and 440,000 of our general partner units held by Spectra Energy, which will result in the reduction of any associated distribution payable to Spectra Energy, beginning in 2016. There will also be a reduction in the aggregate quarterly distributions, if any, to Spectra Energy, (as holder of incentive distribution rights), by $4 million per quarter for a period of 12 consecutive quarters commencing with the quarter ending on December 31, 2015 and ending with the quarter ending on September 30, 2018. This transaction was completed on October 30, 2015.

On November 4, 2015, we acquired the remaining 0.1% ownership interest in SESH from Spectra Energy. Total consideration was 17,114 newly issued common units. This is the last of three planned transactions related to Spectra Energy contributing all of its remaining U.S. transmission, storage, and liquids assets to us (the U.S. Assets Dropdown). Also, in connection with this transaction, we issued 342 of general partner units to Spectra Energy in exchange for the same amount of common units in order to maintain Spectra Energy's 2% general partner interest.

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Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations.

INTRODUCTION

Management’s Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with the accompanying Condensed Consolidated Financial Statements.

EXECUTIVE OVERVIEW

For the three months ended September 30, 2015 and 2014, we reported net income from controlling interests of $321 million and $264 million, respectively. For the nine months ended September 30, 2015 and 2014, we reported net income from controlling interests of $921 million and $721 million, respectively.

The highlights for the three months and nine months ended September 30, 2015 included increased earnings driven by expansion projects, primarily at Texas Eastern Transmission, LP (Texas Eastern), higher crude oil transportation revenues as a result of higher contracted volumes and increased tariff rates mainly on the Express pipeline, and higher equity earnings from Sand Hills as a result of increased volumes.

For the three months ended September 30, 2015 and 2014, distributable cash flow was $270 million and $247 million, respectively. For the nine months ended September 30, 2015 and 2014, distributable cash flow was $945 million and $810 million, respectively.

A cash distribution of $0.62625 per limited partner unit was declared on October 19, 2015 and is payable on November 25, 2015. We intend to increase our quarterly distribution by one and a quarter cents per unit each quarter through 2017. Our Board of Directors evaluates each distribution decision within the confines of the Partnership agreement and based on an assessment of growth in distributable cash flow.

For the nine months ended September 30, 2015, we had $1,252 million of capital and investment expenditures. We currently project $2.5 billion of capital and investment expenditures for the full year, including expansion capital expenditures of $2.2 billion.

We are committed to an investment-grade balance sheet and continued prudent financial management of our capital structure. Therefore, financing growth activities will continue to be based on our strong and growing fee-based earnings and cash flows as well as the issuances of debt and equity securities. As of September 30, 2015, we have access to a $2.0 billion revolving credit facility which is used principally as a back-stop for our commercial paper program.

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RESULTS OF OPERATIONS



	Three Months Ended September 30,				Nine Months Ended September 30,
	2015		2014		2015		2014
	(in millions)
Operating revenues	$	612	$	558	$	1,821	$	1,670
Operating expenses	293		278		869		833
Operating income	319		280		952		837
Earnings from equity investments	49		36		134		93
Other income and expenses, net	23		10		49		19
Interest expense	59		54		179		183
Earnings before income taxes	332		272		956		766
Income tax expense	1		1		8		29
Net income	331		271		948		737
Net income—noncontrolling interests	10		7		27		16
Net income—controlling interests	$	321	$	264	$	921	$	721

Three Months Ended September 30, 2015 Compared to Same Period in 2014

Operating Revenues. The $54 million or 10% increase was driven mainly by:


•	revenues from expansion projects, primarily on Texas Eastern,


•	higher crude oil transportation revenues, as a result of increased tariff rates and higher contracted volumes on the Express pipeline, and


•	higher recoveries of electric power and other costs passed through to gas transmission customers, partially offset by


•	lower processing revenues primarily due to lower prices, net of volume variance.

Operating Expenses. The $15 million or 5% increase was driven mainly by:


•	higher electric power and other costs passed through to gas transmission customers, partially offset by


•	lower project development costs.

Earnings from Equity Investments. The $13 million or 36% increase was mainly attributable to higher earnings from Sand Hills due to increased volumes and the dropdown of an additional 24.95% ownership interest in SESH in November 2014.

Other Income and Expenses, Net. The $13 million increase was mainly attributable to higher allowance for funds used during construction (AFUDC) from higher capital spending on expansion projects.

Interest Expense. The $5 million or 9% increase was driven mainly by higher average long-term debt balances, partially offset by higher capitalized interest.

Nine Months Ended September 30, 2015 Compared to Same Period in 2014

Operating Revenues. The $151 million or 9% increase was driven mainly by:


•	revenues from expansion projects, primarily on Texas Eastern and East Tennessee Natural Gas, LLC (East Tennessee),


•	higher crude oil transportation revenues, as a result of higher contracted volumes and increased tariff rates mainly on the Express pipeline, and


•	higher recoveries of electric power and other costs passed through to gas transmission customers, partially offset by


•	lower processing revenues primarily due to lower prices,


•	lower natural gas transportation revenues mainly from firm margins and interruptible transportation on Texas Eastern and other revenue on East Tennessee, net of higher firm on Algonquin Gas Transmission, L.L.C. (Algonquin), and

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•	lower inventory settlement revenues due to sales of excess tank oil in 2014 and lower oil prices on the Express and Platte pipelines.

Operating Expenses. The $36 million increase was driven mainly by:


•	higher electric power and other costs passed through to gas transmission customers,


•	a non-cash impairment charge on Ozark Gas Gathering, L.L.C. (Ozark Gas Gathering), and


•	higher power costs due to higher usage, net of lower rates on the Express pipeline, partially offset by


•	lower ad valorem tax accruals,


•	lower employee benefit costs, and


•	lower project development costs.

Earnings from Equity Investments. The $41 million or 44% increase was mainly attributable to higher earnings from Sand Hills due to increased volumes and the dropdown of an additional 24.95% ownership interest in SESH in November 2014.

Other Income and Expenses, Net. The $30 million increase was mainly attributable to higher AFUDC from higher capital spending on expansion projects.

Interest Expense. The $4 million decrease was driven mainly by higher capitalized interest due to higher capital spending on expansion projects and lower average interest rates, partially offset by higher average long-term debt balances.

Income Tax Expense. The $21 million decrease mainly reflects a 2014 adjustment to deferred income tax liabilities, as a result of the final purchase price adjustments related to the acquisition of Express-Platte.

Segment Results

Management evaluates segment performance based on EBITDA transactions. Cash, cash equivalents and short-term investments are managed centrally, so the gains and losses from foreign currency remeasurement, and interest and dividend income, are excluded from the segments’ EBITDA. We consider segment EBITDA to be a good indicator of each segment’s operating performance from its continuing operations, as it represents the results of our operations without regard to financing methods or capital structures. Our segment EBITDA may not be comparable to similarly titled measures of other companies because other companies may not calculate EBITDA in the same manner.

Segment EBITDA is summarized in the following table. Detailed discussions follow.

EBITDA by Business Segment



	Three Months Ended September 30,						Nine Months Ended September 30,
	2015			2014			2015			2014
	(in millions)
U.S. Transmission	$	401		$	352		$	1,186		$	1,046
Liquids	79			60			221			169
Total reportable segment EBITDA	480			412			1,407			1,215
Other	(13		)	(11		)	(48		)	(48		)
Total reportable segment and other EBITDA	467			401			1,359			1,167
Depreciation and amortization	74			73			220			216
Interest expense	59			54			179			183
Other income	(2		)	(2		)	(4		)	(2		)
Earnings before income taxes	$	332		$	272		$	956		$	766

The amounts discussed below are after eliminating intercompany transactions.

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U.S. Transmission



	Three Months Ended September 30,						Nine Months Ended September 30,
	2015		2014		Increase (Decrease)		2015		2014		Increase (Decrease)
	(in millions)
Operating revenues	$	515	$	477	$	38	$	1,546	$	1,431	$	115
Operating expenses
Operating, maintenance and other	169		159		10		496		470		26
Other income and expenses	55		34		21		136		85		51
EBITDA	$	401	$	352	$	49	$	1,186	$	1,046	$	140

Three Months Ended September 30, 2015 Compared to Same Period in 2014

Operating Revenues. The $38 million increase was driven by:


•	a $34 million increase due to expansion projects, primarily on Texas Eastern, and


•	a $15 million increase in recoveries of electric power and other costs passed through to customers, partially offset by


•	an $11 million decrease in processing revenues primarily due to lower prices, net of volume variance.

Operating Expenses. The $10 million increase was driven by:


•	a $15 million increase in electric power and other costs passed through to customers, partially offset by


•	a $4 million decrease from project development costs expensed in 2014.

Other Income and Expenses. The $21 million increase was mainly due to higher AFUDC from higher capital spending on expansion projects and higher equity earnings mainly due to the dropdown of an additional 24.95% interest in SESH in November 2014.

Nine Months Ended September 30, 2015 Compared to Same Period in 2014

Operating Revenues. The $115 million increase was driven by:


•	a $99 million increase due to expansion projects, primarily on Texas Eastern and East Tennessee, and


•	a $46 million increase in recoveries of electric power and other costs passed through to customers, partially offset by


•	an $18 million decrease in processing revenues primarily due to lower prices, and


•	a $9 million decrease in natural gas transportation revenues mainly from firm margins and interruptible transportation on Texas Eastern and other revenue on East Tennessee, net of higher firm on Algonquin.

Operating Expenses. The $26 million increase was driven by:


•	a $46 million increase in electric power and other costs passed through to customers, and


•	a $9 million increase due to a non-cash impairment charge on Ozark Gas Gathering, partially offset by


•	a $15 million decrease in ad valorem tax accruals,


•	a $7 million decrease in employee benefit costs, and


•	a $6 million decrease from project development costs expensed in 2014.

Other Income and Expenses. The $51 million increase was mainly due to higher AFUDC from higher capital spending on expansion projects and higher equity earnings mainly due to the dropdown of an additional 24.95% interest in SESH in November 2014.

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Liquids



	Three Months Ended September 30,							Nine Months Ended September 30,
	2015		2014		Increase (Decrease)			2015		2014		Increase (Decrease)
	(in millions)
Operating revenues	$	97	$	81	$	16		$	275	$	239	$	36
Operating expenses
Operating, maintenance and other	37		35		2			105		99		6
Other income and expenses	19		14		5			51		29		22
EBITDA	$	79	$	60	$	19		$	221	$	169	$	52

Express pipeline revenue receipts, MBbl/d (a)	234		221		13			239		217		22
Platte PADD II deliveries, MBbl/d	167		169		(2		)	169		170		(1		)

_______

(a) Thousand barrels per day.

Three Months Ended September 30, 2015 Compared to Same Period in 2014

Operating Revenues. The $16 million increase in operating revenues was primarily driven by higher crude oil transportation revenues, as a result of increased tariff rates and higher contracted volumes on the Express pipeline.

Other Income and Expenses. The $5 million increase was primarily due to higher earnings from Sand Hills due to increased volumes.

Nine Months Ended September 30, 2015 Compared to Same Period in 2014

Operating Revenues. The $36 million increase in operating revenues was driven by:


•	a $48 million increase in crude oil transportation revenues, as a result of higher contracted volumes and increased tariff rates mainly on the Express pipeline, partially offset by


•	a $7 million decrease in inventory settlement revenues due to sales of excess tank oil in 2014 and lower oil prices on the Express and Platte pipelines.

Operating Expenses. The $6 million increase in operating expenses was primarily driven by an increase in power costs due to higher usage in 2015, partially offset by lower rates on the Express pipeline.

Other Income and Expenses. The $22 million increase was primarily due to higher earnings from Sand Hills due to increased volumes.

Other



	Three Months Ended September 30,									Nine Months Ended September 30,
	2015			2014			Increase (Decrease)			2015			2014			Increase (Decrease)
	(in millions)
Operating expenses	$	13		$	11		$	2		$	48		$	48		$	—
EBITDA	$	(13	)	$	(11	)	$	(2	)	$	(48	)	$	(48	)	$	—

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Distributable Cash Flow

We define Distributable Cash Flow as EBITDA plus


•	distributions from equity investments,


•	other non-cash items affecting net income, less


•	earnings from equity investments,


•	interest expense,


•	equity AFUDC,


•	net cash paid for income taxes,


•	distributions to noncontrolling interests, and


•	maintenance capital expenditures, excluding the effect of reimbursable projects.

Distributable Cash Flow does not reflect changes in working capital balances. Distributable Cash Flow should not be viewed as indicative of the actual amount of cash that we plan to distribute for a given period.

Distributable Cash Flow is the primary financial measure used by our management and by external users of our financial statements to assess the amount of cash that is available for distribution.

Distributable Cash Flow is a non-GAAP measure and should not be considered an alternative to Net Income, Operating Income, cash from operations or any other measure of financial performance or liquidity presented in accordance with GAAP. Distributable Cash Flow excludes some, but not all, items that affect Net Income and Operating Income and these measures may vary among other companies. Therefore, Distributable Cash Flow as presented may not be comparable to similarly titled measures of other companies.

Significant drivers of variances in Distributable Cash Flow between the periods presented are substantially the same as those previously discussed under Results of Operations. Other drivers include the timing of certain cash outflows, such as capital expenditures for maintenance.

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Reconciliation of Net Income to Non-GAAP “Distributable Cash Flow”



	Three Months Ended September 30,						Nine Months Ended September 30,
	2015			2014			2015			2014
	(in millions)
Net income	$	331		$	271		$	948		$	737
Add:
Interest expense	59			54			179			183
Income tax expense	1			1			8			29
Depreciation and amortization	74			73			220			216
Foreign currency loss	2			2			5			2
Less:
Third Party interest income	—			—			1			—
EBITDA	467			401			1,359			1,167
Add:
Earnings from equity investments	(49		)	(36		)	(134		)	(93		)
Distributions from equity investments (a)	59			40			183			120
Non-cash impairment on Ozark Gas Gathering	—			—			9			—
Other	2			4			8			10
Less:
Interest expense	59			54			179			183
Equity AFUDC	23			11			50			20
Net cash paid for income taxes	1			—			8			5
Distributions to noncontrolling interests	7			11			23			22
Maintenance capital expenditures (b)	119			86			220			164
Distributable Cash Flow	$	270		$	247		$	945		$	810

________


(a)	Excludes $403 million and $122 million of distributions from equity investments for the nine months ended September 30, 2015 and 2014, respectively.


(b)	Excludes reimbursable expenditures.

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Annual Goodwill Impairment Test

In connection with our quantitative assessments, we primarily use a discounted cash flow analysis to determine fair values of those reporting units. Key assumptions in the determination of fair value include the use of an appropriate discount rate and estimated future cash flows. In estimating cash flows, we incorporate expected long-term growth rates in key markets served by our operations, regulatory stability, the ability to renew contracts, commodity prices (where appropriate) and foreign currency exchange rates, as well as other factors that affect our reporting units’ revenue, expense and capital expenditure projections.

We performed either a quantitative assessment or a qualitative assessment for each of our reporting units to determine whether it is more likely than not that the respective fair values of these reporting units are less than their carrying amounts, including goodwill as of April 1, 2015 (our annual testing date). Based on the results of our annual goodwill impairment testing, no indicators of impairment were noted and the fair values of the reporting units that we assessed at April 1, 2015 were substantially in excess of their respective carrying values.

LIQUIDITY AND CAPITAL RESOURCES

As of September 30, 2015, we had negative working capital of $594 million. This balance includes a payable to an unconsolidated affiliate of $396 million and current maturities of long-term debt of $287 million. We will rely upon cash flows from operations, including cash distributions received from our equity affiliates, and various financing transactions, which may include debt and/or equity issuances, to fund our liquidity and capital requirements for the next 12 months. We have access to a revolving credit facility, with available capacity of $2,000 million at September 30, 2015. This facility is used principally as a back-stop for our commercial paper program, which is used to manage working capital requirements and for temporary funding of our capital expenditures. We expect to be self-funding and plan to continue to pursue expansion opportunities over the next several years. Capital resources may continue to include commercial paper, short-term borrowings under our current credit facility and possibly securing additional sources of capital including debt and/or equity. See Note 7 of Notes to Condensed Consolidated Financial Statements for a discussion of the available credit facility and Financing Cash Flows and Liquidity for a discussion of effective shelf registrations.

Cash Flow Analysis

The following table summarizes the changes in cash flows for each of the periods presented:



	Nine Months Ended September 30,
	2015			2014
	(in millions)
Net cash provided by (used in):
Operating activities	$	1,130		$	913
Investing activities	(835		)	(745		)
Financing activities	(144		)	(153		)
Net increase in cash and cash equivalents	151			15
Cash and cash equivalents at beginning of the period	140			121
Cash and cash equivalents at end of the period	$	291		$	136

Operating Cash Flows

Net cash provided by operating activities increased $217 million to $1,130 million in the nine months ended September 30, 2015 compared to the same period in 2014, driven mainly by higher earnings and higher distributions from unconsolidated affiliates.

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Investing Cash Flows

Net cash used in investing activities increased $90 million to $835 million in the nine months ended September 30, 2015 compared to the same period in 2014. The change was mainly driven by:


•	a $363 million net increase in capital and investment expenditures, partially offset by


•	a $396 million distribution from Gulfstream with proceeds from a Gulfstream debt offering in 2015 compared to a $99 million distribution from SESH with proceeds from a SESH debt offering in 2014.

Capital and Investment Expenditures by Business Segment



	Nine Months Ended September 30,
	2015		2014
	(in millions)
U.S. Transmission	$	1,206	$	838
Liquids	46		51
Total consolidated	$	1,252	$	889

Capital and investment expenditures for the nine months ended September 30, 2015 consisted of $1,038 million for expansion projects and $214 million for maintenance and other projects.

We project 2015 capital and investment expenditures of approximately $2.5 billion, consisting of $2.2 billion of expansion capital expenditures and $0.3 billion for maintenance and upgrades of existing plants, pipelines and infrastructure to serve growth.

Financing Cash Flows and Liquidity

Net cash used in financing activities decreased by $9 million to $144 million in the nine months ended September 30, 2015 compared to the same period in 2014. The change was mainly driven by:


•	$978 million of net issuances of long-term debt in 2015 (which was used primarily to pay down $907 million of commercial paper),


•	a $75 million increase in proceeds from issuances of units, and


•	a $25 million increase in contributions from noncontrolling interests, partially offset by


•	a $104 million increase in distributions to partners.

In the 2015 period, contributions from noncontrolling interests include $32 million from Duke Energy Corporation to purchase a 7.5% equity share in Sabal Trail Transmission, LLC (Sabal Trail). This transaction reduced our ownership in Sabal Trail to 59.5%.

During the nine months ended September 30, 2015, we issued 7.3 million common units to the public under our at-the-market program and approximately 149,000 general partner units to Spectra Energy. Total net proceeds were $358 million, including approximately $7 million of proceeds from Spectra Energy. The net proceeds were used for general partnership purposes, which may have included debt repayment, capital expenditures and/or additions to working capital. In 2015, we have issued 9.6 million common units to the public and approximately 197,000 general partner units to Spectra Energy, for total net proceeds of approximately $458 million, including $9 million of proceeds from Spectra Energy.

On March 12, 2015, we issued $1.0 billion aggregate principal amount of senior unsecured notes, comprised of $500 million of 3.50% senior notes due in 2025 and $500 million of 4.50% senior notes due in 2045. Net proceeds from the offering were used to repay a portion of outstanding commercial paper, to fund capital expenditures and for general partnership purposes.

Available Credit Facility and Restrictive Debt Covenants. See Note 7 of Notes to Condensed Consolidated Financial Statements for a discussion of the available credit facility and related financial and other covenants.

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Cash Distributions. A cash distribution of $0.62625 per limited partner unit was declared on October 19, 2015, payable on November 25, 2015, representing the thirty-second consecutive quarterly increase.

Other Financing Matters. We have an effective shelf registration statement on file with the Securities and Exchange Commission (SEC) to register the issuance of unspecified amounts of limited partner common units and various debt securities and another registration statement on file with the SEC to register the issuance of $500 million, in the aggregate, of limited partner units over time. This registration has $184 million available as of September 30, 2015.

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OTHER ISSUES

New Accounting Pronouncements. See Note 12 of Notes to Condensed Consolidated Financial Statements for discussion.



Item 3.	Quantitative and Qualitative Disclosures about Market Risk.

Our exposure to market risk is described in Item 7A of our Annual Report on Form 10-K, for the year ended December 31, 2014. We believe our exposure to market risk has not changed materially since then.



Item 4.	Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed by us in the reports we file or submit under the Securities Exchange Act of 1934 (Exchange Act) is recorded, processed, summarized, and reported, within the time periods specified by the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to provide reasonable assurance that information required to be disclosed by us in the reports we file or submit under the Exchange Act is accumulated and communicated to management, including the Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

Under the supervision and with the participation of the management of Spectra Energy Partners (DE) GP, LP (our General Partner), including the Chief Executive Officer and Chief Financial Officer, we have evaluated the effectiveness of our disclosure controls and procedures (as such term is defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act) as of September 30, 2015, and, based upon this evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that these controls and procedures are effective at the reasonable assurance level.

Changes in Internal Control over Financial Reporting

Under the supervision and with the participation of the management of our General Partner, including the Chief Executive Officer and Chief Financial Officer, we have evaluated changes in internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during the fiscal quarter ended September 30, 2015 and found no change that has materially affected, or is reasonably likely to materially affect, internal control over financial reporting.

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PART II. OTHER INFORMATION



Item 1.	Legal Proceedings.

We have no material pending legal proceedings that are required to be disclosed hereunder. For information regarding other legal proceedings and environmental matters, see Note 10 of Notes to Condensed Consolidated Financial Statements, which information is incorporated by reference into this Part II.



Item 1A.	Risk Factors.

In addition to the other information set forth in this report, careful consideration should be given to the factors discussed in Part I, “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2014, which could materially affect our financial condition or future results. There have been no material changes to those risk factors.



Item 6.	Exhibits.

Any agreements included as exhibits to this Form 10-Q may contain representations and warranties by each of the parties to the applicable agreement. These representations and warranties have been made solely for the benefit of the other parties to the applicable agreement and:


•	were not intended to be treated as categorical statements of fact, but rather as a way of allocating the risk to one of the parties if those statements prove to be inaccurate;


•	may have been qualified by disclosures that were made to the other party in connection with the negotiation of the applicable agreement;


•	may apply contract standards of “materiality” that are different from “materiality” under the applicable securities laws; and


•	were made only as of the date of the applicable agreement or such other date or dates as may be specified in the agreement.

We acknowledge that, notwithstanding the inclusion of the foregoing cautionary statements, we are responsible for considering whether additional specific disclosures of material information regarding material contractual provisions are required to make the statements in this Form 10-Q not misleading.

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(a) Exhibits
Exhibit Number


3.1		Amendment No. 1, dated July 2, 2015, to the Second Amended and Restated Agreement of Limited Partnership of Spectra Energy Partners, LP, dated as of November 1, 2013 (filed as Exhibit 3.1 to Spectra Energy Partners, LP's Form 8-K dated July 6, 2015).

*3.2		Fourth Amended and Restated Limited Liability Company Agreement of Spectra Energy Partners GP, LLC, dated as of September 17, 2015.

*31.1		Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

*31.2		Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

*32.1		Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

*32.2		Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

*101.INS		XBRL Instance Document.

*101.SCH		XBRL Taxonomy Extension Schema.

*101.CAL		XBRL Taxonomy Extension Calculation Linkbase.

*101.DEF		XBRL Taxonomy Extension Definition Linkbase.

*101.LAB		XBRL Taxonomy Extension Label Linkbase.

*101.PRE		XBRL Taxonomy Extension Presentation Linkbase.



*	Filed herewith

The total amount of securities of the registrant or its subsidiaries authorized under any instrument with respect to long-term debt not filed as an exhibit does not exceed 10% of the total assets of the registrant and its subsidiaries on a consolidated basis. The registrant agrees, upon request of the Securities and Exchange Commission, to furnish copies of any or all of such instruments to it.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.




	SPECTRA ENERGY PARTNERS, LP

	By:	Spectra Energy Partners (DE) GP, LP, its general partner

	By:	Spectra Energy Partners GP, LLC, its general partner

Date: November 5, 2015		/S/ GREGORY L. EBEL
		Gregory L. Ebel President and Chief Executive Officer

Date: November 5, 2015		/S/ J. PATRICK REDDY
		J. Patrick Reddy Chief Financial Officer

EXHIBIT 3.2

FOURTH AMENDED AND RESTATED
LIMITED LIABILITY COMPANY AGREEMENT

SPECTRA ENERGY PARTNERS GP, LLC
A Delaware Limited Liability Company

Dated as of
September 17, 2015

FOURTH AMENDED AND RESTATED LIMITED
LIABILITY COMPANY AGREEMENT
OF
SPECTRA ENERGY PARTNERS GP, LLC

A Delaware Limited Liability Company

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ARTICLE 1
DEFINITIONS
1.01	Definitions	1
1.02	Construction	1
ARTICLE 2
ORGANIZATION
2.01	Formation	2
2.02	Name	2
2.03	Registered Office; Registered Agent; Principal Office; Other Offices	2
2.04	Purpose	2
2.05	Term	2
2.06	No State-law Partnership; Withdrawal	2
2.07	Certain Undertakings Relating to Separateness	3
ARTICLE 3
MATTERS RELATING TO MEMBERS
3.01	Members	4
3.02	Creation of Additional Membership Interest	4
3.03	Liability to Third Parties	5
ARTICLE 4
CAPITAL CONTRIBUTIONS
4.01	Capital Contributions	5
4.02	Loans	5
4.03	Return of Contributions	5
ARTICLE 5
DISTRIBUTIONS
5.01	Distributions	5
ARTICLE 6
MANAGEMENT
6.01	Management	5



6.02	Board of Directors	8
6.03	Officers	10
6.04	Duties of Officers and Directors	12
6.05	Compensation	12
6.06	Indemnification	13
6.07	Liability of Indemnitees	14
ARTICLE 7
TAX MATTERS
7.01	Tax Returns and Tax Characterization	15
ARTICLE 8
BOOKS, RECORDS, REPORTS, AND BANK ACCOUNTS
8.01	Maintenance of Books	15
8.02	Reports	16
8.03	Bank Accounts	16
ARTICLE 9
DISSOLUTION, WINDING-UP AND TERMINATION
9.01	Dissolution	16
9.02	Winding-Up and Termination	16
ARTICLE 10
MERGER, CONSOLIDATION OR CONVERSION
10.01	Authority	17
10.02	Procedure for Merger, Consolidation or Conversion	18
10.03	Approval by Members of Merger or Consolidation	19
10.04	Certificate of Merger, Consolidation or Conversion	19
ARTICLE 11
GENERAL PROVISIONS
11.01	Notices	20
11.02	Entire Agreement; Supersedure	21
11.03	Effect of Waiver or Consent	21
11.04	Amendment or Restatement	21
11.05	Binding Effect	21
11.06	Governing Law; Severability	21
11.07	Further Assurances	22
11.08	Offset	22
11.09	Counterparts	22

FOURTH AMENDED AND RESTATED LIMITED
LIABILITY COMPANY AGREEMENT
OF
SPECTRA ENERGY PARTNERS GP, LLC
A Delaware Limited Liability Company

THIS FOURTH AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT (this “Agreement”) of Spectra Energy Partners GP, LLC, a Delaware limited liability company (the “Company”), executed and effective as of September 17, 2015 (the “Effective Date”), is adopted, executed and agreed to, by Spectra Energy Southeast Pipeline Corporation, a Delaware corporation (“SESPC”), as the sole Member of the Company.

RECITALS

A.Spectra Energy Transmission, LLC (“SET”) formed the Company on March 19, 2007 as the sole member.

B. The Limited Liability Company Agreement of the Company was executed effective March 19, 2007, the First Amended and Restated Limited Liability Company Agreement of the Company was executed effective July 2, 2007, the Second Amended and Restated Limited Liability Company Agreement of the Company was executed effective May 8, 2013, and the Third Amended and Restated Limited Liability Company Agreement of the Company was executed effective November 1, 2013 (the “Existing Agreement”).

C. SET assigned its interest in the Company to SESPC on August 1, 2013 and, effective as of that date, SESPC was admitted as the sole Member of the Company.

D. SESPC, the sole Member of the Company, deems it advisable to amend and restate the limited liability company agreement of the Company in its entirety as set forth herein.

AGREEMENTS

For and in consideration of the premises, the covenants and agreements set forth herein and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, SESPC, as the sole Member of the Company, hereby amends and restates the Existing Agreement in its entirety as follows:

ARTICLE 1

DEFINITIONS

1.01 Definitions. Each capitalized term used herein shall have the meaning given such term in Attachment I.

1.02 Construction. Unless the context requires otherwise: (a) the gender (or lack of gender) of all words used in this Agreement includes the masculine, feminine and neuter; (b) references to Articles and Sections refer to Articles and Sections of this Agreement; (c) references to laws refer to such laws as they may be amended from time to time, and references to particular

provisions of a law include any corresponding provisions of any succeeding law; (d) references to money refer to legal currency of the United States of America; (e) “including” means “including without limitation” and is a term of illustration and not of limitation; (f) all definitions set forth herein shall be deemed applicable whether the words defined are used herein in the singular or the plural; and (g) neither this Agreement nor any other agreement, document or instrument referred to herein or executed and delivered in connection herewith shall be construed against any Person as the principal draftsperson hereof or thereof.

ARTICLE 2
ORGANIZATION

2.01 Formation. The Company was organized as a Delaware limited liability company by the filing of a Certificate of Formation (“Organizational Certificate”) on March 19, 2007 with the Secretary of State of the State of Delaware under and pursuant to the Delaware Act.

2.02 Name. The name of the Company is “Spectra Energy Partners GP, LLC” and all Company business must be conducted in that name or such other names that comply with law as the Board of Directors may select.

2.03 Registered Office; Registered Agent; Principal Office; Other Offices. The registered office of the Company required by the Delaware Act to be maintained in the State of Delaware shall be the office of the initial registered agent for service of process named in the Organizational Certificate or such other office (which need not be a place of business of the Company) as the Board of Directors may designate in the manner provided by law. The registered agent for service of process of the Company in the State of Delaware shall be the initial registered agent for service of process named in the Organizational Certificate or such other Person or Persons as the Board of Directors may designate in the manner provided by law. The principal office of the Company in the United States shall be at such a place as the Board of Directors may from time to time designate, which need not be in the State of Delaware, and the Company shall maintain records there and shall keep the street address of such principal office at the registered office of the Company in the State of Delaware. The Company may have such other offices as the Board of Directors may designate.

2.04 Purpose. The purposes of the Company are the transaction of any or all lawful business for which limited liability companies may be organized under the Delaware Act.

2.05 Term. The period of existence of the Company commenced on March 19, 2007 and shall end at such time as a certificate of cancellation is filed in accordance with Section 9.02(c).

2.06 No State-law Partnership; Withdrawal. It is the intent that the Company shall be a limited liability company formed under the laws of the State of Delaware and shall not be a partnership (including a limited partnership) or joint venture, and that the Members not be a partner or joint venturer of any other party for any purposes other than federal and state tax purposes, and this Agreement may not be construed to suggest otherwise. A Member does not have the right to Withdraw from the Company; provided, however, that a Member shall have the power to Withdraw at any time in violation of this Agreement. If a Member exercises such power in violation of this

Agreement, (a) such Member shall be liable to the Company and its Affiliates for all monetary damages suffered by them as a result of such Withdrawal; and (b) such Member shall not have any rights under Section 18.604 of the Delaware Act. In no event shall the Company have the right, through specific performance or otherwise, to prevent a Member from Withdrawing in violation of this Agreement.

2.07 Certain Undertakings Relating to Separateness.

(a) Separateness Generally. The Company shall, and shall cause SEP GP to, conduct their respective businesses and operations in accordance with this Section 2.07.

(b) Separate Records. The Company shall, and shall cause SEP GP to, (i) maintain their respective books and records and their respective accounts separate from those of any other Person, (ii) maintain their respective financial records, which will be used by them in their ordinary course of business, showing their respective assets and liabilities separate and apart from those of any other Person, except their consolidated Subsidiaries, (iii) not have their respective assets and/or liabilities included in a consolidated financial statement of any Affiliate of the Company unless appropriate notation shall be made on such Affiliate’s consolidated financial statements to indicate the separateness of the Company and SEP GP and their assets and liabilities from such Affiliate and the assets and liabilities of such Affiliate, and to indicate that the assets and liabilities of the Company and SEP GP are not available to satisfy the debts and other obligations of such Affiliate, and (iv) file their respective own tax returns separate from those of any other Person, except (A) to the extent that the Company or SEP GP (x) is treated as a “disregarded entity” for tax purposes or (y) is not otherwise required to file tax returns under applicable law or (B) as may otherwise be required by applicable law.

(c) Separate Assets. The Company shall not commingle or pool, and shall cause SEP GP not to commingle or pool, their respective funds or other assets with those of any other Person, and shall maintain their respective assets in a manner that is not costly or difficult to segregate, ascertain or otherwise identify as separate from those of any other Person.

(d) Separate Name. The Company shall, and shall cause SEP GP to, (i) conduct their respective businesses in their respective own names, (ii) use separate stationery, invoices, and checks, (iii) correct any known misunderstanding regarding their respective separate identities from that of any other Person (including SESPC and its Subsidiaries other than the Company and SEP GP), and (iv) generally hold itself out as an entity separate from any other Person (including SESPC and its Subsidiaries other than the Company and SEP GP).

(e) Separate Credit. The Company shall, and shall cause SEP GP to, (i) pay their respective obligations and liabilities from their respective own funds (whether on hand or borrowed), (ii)maintain adequate capital in light of their respective business operations, (iii) not guarantee or become obligated for the debts of any other Person, other than the Company and SEP GP and except to the extent specified in the Contribution Agreement or the Omnibus Agreement, (iv) not hold out their respective credit as being available to satisfy the obligations or liabilities of any other Person except to the extent specified in the Contribution Agreement or the Omnibus Agreement, (v) not acquire debt obligations or debt securities of SESPC or its Affiliates (other than the Company and

SEP GP), (vi) not pledge their assets for the benefit of any Person or make loans, advances or capital contributions to SESPC or any of its Affiliates (other than the MLP and its Subsidiaries and, with respect to the Company, other than SEP GP), or (vii) use its commercially reasonable efforts to cause the operative documents under which SEP GP borrows money, is an issuer of debt securities, or guarantees any such borrowing or issuance after the Effective Date, to contain provisions to the effect that (A) the lenders or purchasers of debt securities, respectively, acknowledge that they have advanced funds or purchased debt securities, respectively, in reliance upon the separateness of the Company and SEP GP from each other and from any other Persons (including SESPC and its Affiliates, other than the Company and SEP GP) and (B) the Company and SEP GP have assets and liabilities that are separate from those of other persons (including SESPC and its Affiliates, other than the Company and SEP GP); provided that the Company and SEP GP may engage in any transaction described in clauses (v)-(vi) of this Section 2.07(e) if prior Special Approval has been obtained for such transaction and either (A) the Conflicts Committee has determined that the borrower or recipient of the credit support is not then insolvent and will not be rendered insolvent as a result of such transaction or (B) in the case of transactions described in clause 2.07(e)(v), such transaction is completed through a public sale or a National Securities Exchange.

(f) Separate Formalities. The Company shall, and shall cause SEP GP to, (i) observe all limited liability company or partnership formalities and other formalities required by their respective organizational documents, the laws of the jurisdiction of their respective formation, or other laws, rules, regulations and orders of governmental authorities exercising jurisdiction over it, (ii) engage in transactions with SESPC and its Affiliates (other than the Company or SEP GP) in conformity with the requirements of Section 6.09 of this Agreement, and (iii) subject to the terms of the Omnibus Agreement, promptly pay, from their respective own funds and on a timely basis, their respective allocable shares of general and administrative expenses, capital expenditures, and costs for services performed by SESPC or Affiliates of SESPC (other than the Company or SEP GP).

(g) No Effect. Failure by the Company to comply with any of the obligations set forth above shall not affect the status of the Company as a separate legal entity, with its separate assets and separate liabilities or restrict or limit the Company from engaging or contracting with SESPC and its Affiliates for the provision of services or the purchase or sale of products, whether under the Omnibus Agreement or otherwise.

ARTICLE 3
MATTERS RELATING TO MEMBERS

3.01 Members. SESPC has previously been admitted as a Member of the Company.

3.02 Creation of Additional Membership Interest. The Company may issue additional Membership Interests in the Company pursuant to this Section 3.02. The terms of admission or issuance may provide for the creation of different classes or groups of Members having different rights, powers, and duties. The creation of any new class or group of Members approved as required herein may be reflected in an amendment to this Agreement executed in accordance with Section 11.04 indicating the different rights, powers, and duties thereof. Any such admission is effective only after the new Member has executed and delivered to the Members an instrument containing

the notice address of the new Member and the new Member’s ratification of this Agreement and agreement to be bound by it.

3.03 Liability to Third Parties. No Member or beneficial owner of any Membership Interest shall be liable for the Liabilities of the Company.

ARTICLE 4
CAPITAL CONTRIBUTIONS

4.01 Capital Contributions.

(a) The amount of money and the fair market value (as of the date of contribution) of any property (other than money) contributed to the Company by a Member in respect of the issuance of a Membership Interest to such Member shall constitute a “Capital Contribution.” Any reference in this Agreement to the Capital Contribution of a Member shall include a Capital Contribution of its predecessors in interest.

4.02 Loans. If the Company does not have sufficient cash to pay its obligations, any Member that may agree to do so may, upon Special Approval, advance all or part of the needed funds for such obligation to or on behalf of the Company. An advance described in this Section 4.02 constitutes a loan from the Member to the Company, may bear interest at a rate comparable to the rate the Company could obtain from third parties, and is not a Capital Contribution.

4.03 Return of Contributions. A Member is not entitled to the return of any part of its Capital Contributions or to be paid interest in respect of its Capital Contributions. An unrepaid Capital Contribution is not a liability of the Company or of any Member. No Member will be required to contribute or to lend any cash or property to the Company to enable the Company to return any Member’s Capital Contributions.

ARTICLE 5
DISTRIBUTIONS

5.01 Distributions. Subject to Section 9.02, within 60 days following each Quarter other than any Quarter in which the dissolution of the Company has commenced (the “Distribution Date”), the Company shall distribute to the Members the Company’s Available Cash on such Distribution Date.

ARTICLE 6
MANAGEMENT

6.01 Management.

(a) All management powers over the business and affairs of the Company shall be exclusively vested in a Board of Directors (“Board of Directors” or “Board”) and, subject to the direction of the Board of Directors, the Officers. The Officers and Directors shall each constitute a “manager” of the Company within the meaning of the Delaware Act. Except as otherwise specifically provided in this Agreement, no Member, by virtue of having the status of a Member,

shall have or attempt to exercise or assert any management power over the business and affairs of the Company or shall have or attempt to exercise or assert actual or apparent authority to enter into contracts on behalf of, or to otherwise bind, the Company. Except as otherwise specifically provided in this Agreement, the authority and functions of the Board of Directors on the one hand and of the Officers on the other shall be identical to the authority and functions of the board of directors and officers, respectively, of a corporation organized under the Delaware General Corporation law; provided that any authority or function of the Board of Directors may be delegated by the Board of Directors to the Officers. Except as otherwise specifically provided in this Agreement, the business and affairs of the Company shall be managed under the direction of the Board of Directors, and the day-to-day activities of the Company shall be conducted on the Company’s behalf by the Officers, who shall be agents of the Company.

(b) In addition to the powers that now or hereafter can be granted to managers under the Delaware Act and to all other powers granted under any other provision of this Agreement, except as otherwise provided in this Agreement, the Board of Directors and the Officers shall have full power and authority to do all things as are not restricted by this Agreement, the SEP GP Agreement, the Delaware Act or applicable law, on such terms as they may deem necessary or appropriate to conduct, or cause to be conducted, the business and affairs of the Company.

(c) Notwithstanding anything herein to the contrary, without obtaining Extraordinary Approval, the Company shall not, and shall not take any action to cause either SEP GP or the MLP to, (i) make or consent to a general assignment for the benefit of its respective creditors; (ii) file or consent to the filing of any bankruptcy, insolvency or reorganization petition for relief under the United States Bankruptcy Code naming the Company, SEP GP or the MLP, as applicable, or otherwise seek, with respect to the Company, SEP GP or the MLP, relief from debts or protection from creditors generally; (iii) file or consent to the filing of a petition or answer seeking for the Company, SEP GP or the MLP, as applicable, a liquidation, dissolution, arrangement, or similar relief under any law; (iv) file an answer or other pleading admitting or failing to contest the material allegations of a petition filed against the Company, SEP GP or the MLP, as applicable, in a proceeding of the type described in any of clauses (i) – (iii) of this Section 6.01(c); (v) seek, consent to or acquiesce in the appointment of a receiver, liquidator, conservator, assignee, trustee, sequestrator, custodian or any similar official for the Company, SEP GP or the MLP, as applicable, or for all or any substantial portion of either entity’s properties; (vi) sell all or substantially all of the assets of the Company, SEP GP or the MLP; (vii) dissolve or liquidate, except in the case of SEP GP, in accordance with Article VIII of the SEP GP Agreement; (viii) merge or consolidate; (ix) amend the MLP Partnership Agreement; (x) make a material change in the amount of the quarterly distributions made on the MLP Interests or the payment of any material extraordinary distribution on the MLP Interests; or (xi) enter into any agreement or series of related agreements in excess of the maximum authorized amount as set forth in the Delegation of Authority Policy.

(d) Notwithstanding anything herein to the contrary, SESPC, as the sole Member of the Company, shall have exclusive authority over the business and affairs of the Company that do not relate to management and control of the MLP. The type of matter referred to in the prior sentence where SESPC, as the sole Member of the Company, shall have exclusive authority shall include, but not be limited to, (i) the amount and timing of distributions paid by the Company or

SEP GP, (ii) the issuance or repurchase of any equity interests in the Company or SEP GP, (iii) the prosecution, settlement or management of any claim made directly against the Company or SEP GP, (iv) whether to sell, convey, transfer or pledge any asset of the Company or SEP GP, (v) whether to amend, modify or waive any rights relating to the assets of the Company or SEP GP (including the decision to amend or forego distributions in respect of the Incentive Distribution Rights), and (vi) whether to enter into any agreement to incur an obligation of the Company or SEP GP other than an agreement entered into for and on behalf of the MLP for which the Company or SEP GP are liable exclusively by virtue of SEP GP’s capacity as general partner of the MLP or of any of its affiliates. Further, SESPC, as the sole Member of the Company, shall have exclusive authority to cause the Company to exercise the rights of the Company and those of SEP GP, as general partner of the MLP (or those exercisable after SEP GP ceases to be the general partner of the MLP), pursuant to the following provisions of the MLP Partnership Agreement:

(i)Section 2.4 (“Purpose and Business”), with respect to decisions to propose or approve the conduct by the MLP of any business;

(ii) Sections 4.6(a) and (b) (“Transfer of the General Partner’s General Partner Interest”) and Section 4.7 (“Transfer of Incentive Distribution Rights”), solely with respect to the decision by SEP GP to transfer its general partner interest in the MLP or its Incentive Distribution Rights;

(iii) Section 5.2(b) (“Contributions by the General Partner and its Affiliates”), solely with respect to the decision to make additional Capital Contributions to the MLP;

(iv) Section 5.8 (“Limited Preemptive Right”);

(v) Section 5.11 (“Issuance of Class B Units in Connection with Reset of Incentive Distribution Rights”), with respect to any decision by the Company or SEP GP thereunder as a holder of Incentive Distribution Rights or Class B Units;

(vi) Section 7.5(c) (relating to the right of SEP GP and its Affiliates to purchase Units or other Partnership Securities and exercise rights related thereto) and Section 7.11 (“Purchase and Sale of Partnership Securities”), solely with respect to decisions by the Company or SEP GP to purchase or otherwise acquire and sell Partnership Securities for their own account;

(vii) Section 7.6(a) (“Loans from the General Partner; Loans or Contributions from the Partnership or Group Members”), solely with respect to the decision by the Company or SEP GP to lend funds to a Group Member, subject to the provisions of Section 7.9 of the MLP Partnership Agreement;

(viii) Section 7.7 (“Indemnification”), solely with respect to any decision by the Company or SEP GP to exercise their respective rights as “Indemnitees”;

(ix) Section 7.12 (“Registration Rights of the General Partner and its Affiliates”), solely with respect to any decision to exercise registration rights and to take actions in connection therewith;

(x) Section 11.1 (“Withdrawal of the General Partner”), solely with respect to the decision by SEP GP to withdraw as general partner of the MLP and to giving notices required thereunder;

(xi) Section 11.3(a) and (b) (“Interest of Departing General Partner and Successor General Partner”); and

(xii) Section 15.1 (“Right to Acquire Limited Partner Interests”).

6.02 Board of Directors.

(a) Generally. The Board of Directors shall initially consist of six natural persons and, in the discretion of SESPC, may be increased to consist of up to 10 natural persons. The members of the Board of Directors shall be appointed by SESPC; provided that at least three members of the Board of Directors shall be natural persons who meet the independence, qualification and experience requirements of the New York Stock Exchange, the independence, qualification and experience requirements of Section 10A(m)(3) of the Securities Exchange Act of 1934 (or any successor law), the rules and regulations of the SEC and other applicable law (an “Independent Director”),at all times; provided, however, that if at any time the Board of Directors does not include the requisite number of Independent Directors as specified above, the Board of Directors shall still have all powers and authority granted to it hereunder, but SESPC shall endeavor to appoint one or more additional Independent Directors as necessary to come into compliance with this Section 6.02(a).

(b) Term; Resignation; Vacancies; Removal. Each Director shall hold office until his successor is appointed and qualified or until his earlier resignation or removal. Any Director may resign at any time upon written notice to the Board, the Chairman of the Board, to the Chief Executive Officer or to any other Officer. Such resignation shall take effect at the time specified therein, and unless otherwise specified therein no acceptance of such resignation shall be necessary to make it effective. Vacancies and newly created directorships resulting from any increase in the authorized number of Directors or from any other cause shall be filled by SESPC. Any Director may be removed, with or without cause, by SESPC at any time, and the vacancy in the Board caused by any such removal shall be filled by SESPC.

(i) each member of the Board of Directors shall have one vote;

(ii) except for matters requiring Special Approval, the presence at a meeting of a majority of the members of the Board of Directors shall constitute a quorum at any such meeting for the transaction of business; and

(iii) except for matters requiring Special Approval, the act of a majority of the members of the Board of Directors present at a meeting duly called in accordance with Section 6.02(d) at which a quorum is present shall be deemed to constitute the act of the Board of Directors.

(d) Meetings. Regular meetings of the Board of Directors shall be held at such times and places as shall be designated from time to time by resolution of the Board of Directors. Special meetings of the Board of Directors or meetings of any committee thereof may be called by written request authorized by any member of the Board of Directors or a committee thereof on at least 24 hours prior written notice to the other members of such Board or committee. Any such notice, or waiver thereof, need not state the purpose of such meeting, except as may otherwise be required by law. Attendance of a Director at a meeting (including pursuant to the last sentence of this Section 6.02(d)) shall constitute a waiver of notice of such meeting, except where such Director attends the meeting for the express purpose of objecting to the transaction of any business on the ground that the meeting is not lawfully called or convened. Any action required or permitted to be taken at a meeting of the Board of Directors or any committee thereof may be taken without a meeting, without prior notice and without a vote if a consent or consents in writing, setting forth the action so taken, are signed by at least as many members of the Board of Directors or committee thereof as would have been required to take such action at a meeting of the Board of Directors or such committee. Members of the Board of Directors or any committee thereof may participate in and hold a meeting by means of conference telephone, video conference or similar communications equipment by means of which all Persons participating in the meeting can hear each other, and participation in such meetings shall constitute presence in person at the meeting.

(e) Committees.

(i) Subject to compliance with this Article 6, committees of the Board of Directors shall have and may exercise such of the powers and authority of the Board of Directors with respect to the management of the business and affairs of the Company as may be provided in a resolution of the Board of Directors. Any committee designated pursuant to this Section 6.02(e) shall choose its own chairman, shall keep regular minutes of its proceedings and report the same to the Board of Directors when requested, and, subject to Section 6.02(d), shall fix its own rules or procedures and shall meet at such times and at such place or places as may be provided by such rules or by resolution of such committee or resolution of the Board of Directors. At every meeting of any such committee, the presence of a majority of all the members thereof shall constitute a quorum and the affirmative vote of a majority of the members present shall be necessary for the adoption by it of any resolution (except for obtaining Special Approval at meetings of the Conflicts Committee, which requires the affirmative vote of a majority of the members of such committee). The Board of Directors may designate one or more Directors as alternate members of any committee who may replace any absent or disqualified member at any meeting of such committee; provided, however, that any such designated alternate of the Audit Committee or the Conflicts Committee must meet the standards for an Independent Director. In the absence or disqualification of a member of a committee, the member or members present at any meeting and not disqualified from voting, whether or not constituting a quorum, may unanimously appoint another member of the Board of Directors to act at the meeting in the place of the absent or disqualified member; provided, however,

that any such replacement member of the Audit Committee or the Conflicts Committee must meet the standards for an Independent Director.

(ii) In addition to any other committees established by the Board of Directors pursuant to Section 6.02(e)(i), the Board of Directors shall maintain a “Conflicts Committee,” which shall be composed of at least two Independent Directors none of whom is a security holder, officer or employee of the Company or SEP GP; is an officer, director or employee of any Affiliate of the Company or SEP GP; or is a holder of any ownership interest in the MLP Group other than Common Units. The Conflicts Committee shall be responsible for (A) approving or disapproving, as the case may be, any matters regarding the business and affairs of the Company, SEP GP or the MLP considered by, or submitted to, such Conflicts Committee at the request of the Board of Directors pursuant to the terms of this Agreement or the MLP Partnership Agreement, (B) approving any amendment to the Omnibus Agreement requiring the approval of the Conflicts Committee pursuant to Section 4.6 thereof, (C) amending (1) Section 2.07, (2) the definitions of “Independent Director” in Section 6.02(a) or (3) this Section 6.02(e)(ii), and (D) performing such other functions as the Board may assign from time to time or as may be specified in a written charter of the Conflicts Committee.

(iii) In addition to any other committees established by the Board of Directors pursuant to Section 6.02(e)(i), the Board of Directors shall maintain an “Audit Committee,” which shall be composed of at least three Independent Directors at all times. The Audit Committee shall be responsible for (A) assisting the Board in monitoring (1) the quality and integrity of the MLP’s financial statements, (2) the MLP’s compliance with legal and regulatory requirements, (3) the qualifications and independence of the MLP’s independent auditors, (4) the performance the internal audit function and independent auditors of the Company, SEP GP and the MLP, and (5) the implementation and effectiveness of the MLP’s ethics and compliance program and the commitment of the Board of Directors to its ethical and compliance responsibilities and (B) preparing any reports that may be required by the rules of the SEC to be included in the MLP’s annual report on Form 10-K. The Audit Committee shall perform such other functions as the Board may assign from time to time or as may be specified in a written charter for the Audit Committee adopted by the Board.

6.03 Officers.

(a) Generally. The Board of Directors, as set forth below, shall appoint officers of the Company (“Officers”), who shall (together with the Directors) constitute “managers” of the Company for the purposes of the Delaware Act. Unless provided otherwise by resolution of the Board of Directors, the Officers shall have the titles, power, authority and duties described below in this Section 6.03.

(b) Titles and Number. The Company may appoint one or more officers, including a Chairman of the Board (unless the Board of Directors provides otherwise), a President and Chief Executive Officer, a Chief Financial Officer, one or more Vice Presidents, a General Counsel, a Secretary, any Treasurer and one or more Assistant Secretaries and Assistant Treasurers. Any person may hold more than one office.

(c) Appointment and Term of Office. The Officers shall be appointed by the Board of Directors at such time and for such term as the Board of Directors shall determine. Any Officer may be removed, with or without cause, only by the Board of Directors. Vacancies in any office may be filled only by the Board of Directors.

(d) Chairman of the Board. The Chairman of the Board shall preside at all meetings of the Board of Directors and of the unitholders of the MLP; and he shall have such other powers and duties as from time to time may be assigned to him by the Board of Directors.

(e) President and Chief Executive Officer. Subject to the limitations imposed by this Agreement, any employment agreement, any employee plan or any determination of the Board of Directors, the President and Chief Executive Officer, subject to the direction of the Board of Directors, shall be the chief executive officer of the Company and shall be responsible for the management and direction of the day-to-day business and affairs of the Company, its other Officers, employees and agents, shall supervise generally the affairs of the Company and shall have full authority to execute all documents and take all actions that the Company may legally take. In the absence of the Chairman of the Board, the Chief Executive Officer shall preside at all meetings of the unitholders of the MLP and at all meetings of the Board of Directors provided that he is a director of the Company. The Chief Executive Officer shall exercise such other powers and perform such other duties as may be assigned to him by this Agreement or the Board of Directors, including any duties and powers provided for in any employment agreement approved by the Board of Directors.

(f) Chief Financial Officer. The Chief Financial Officer shall keep and maintain, or cause to be kept and maintained, adequate and correct books and records of account of the Company and SEP GP. He shall receive and deposit all moneys and other valuables belonging to the Company in the name and to the credit of the Company and shall disburse the same and only in such manner as the Board of Directors or the appropriate Officer of the Company may from time to time determine. He shall receive and deposit all moneys and other valuables belonging to SEP GP in the name and to the credit of SEP GP and shall disburse the same and only in such manner as the Board of Directors or the Chief Executive Officer may require. He shall render to the Board of Directors and the President and Chief Executive Officer, whenever any of them request it, an account of all his transactions as Chief Financial Officer and of the financial condition of the Company, and shall perform such further duties as the Board of Directors or the President and the Chief Executive Officer may require. The Chief Financial Officer shall have the same power as the President and Chief Executive Officer to execute documents on behalf of the Company.

(g) Vice Presidents. In the absence of a President and Chief Executive Officer, each Vice President appointed by the Board of Directors shall have all of the powers and duties conferred upon the President and Chief Executive Officer, including the same power as the President and Chief Executive Officer to execute documents on behalf of the Company. Each such Vice President shall perform such other duties and may exercise such other powers as may from time to time be assigned to him by the Board of Directors or the President and Chief Executive Officer.

(h) General Counsel. The General Counsel, subject to the discretion of the Board of Directors, shall be responsible for the management and direction of the day-to-day legal affairs of the Company. The General Counsel shall perform such other duties and may exercise such other

powers as may from time to time be assigned to him by the Board of Directors or the President and Chief Executive Officer.

(i) Secretary and Assistant Secretaries. The Secretary shall record or cause to be recorded in books provided for that purpose the minutes of the meetings or actions of the Board of Directors, shall see that all notices are duly given in accordance with the provisions of this Agreement and as required by law, shall be custodian of all records (other than financial), shall see that the books, reports, statements, certificates and all other documents and records required by law are properly kept and filed, and, in general, shall perform all duties incident to the office of Secretary and such other duties as may, from time to time, be assigned to him by this Agreement, the Board of Directors or the President and Chief Executive Officer. The Assistant Secretaries shall exercise the powers of the Secretary during that Officer’s absence or inability or refusal to act.

(j) Treasurer and Assistant Treasurers. The Treasurer shall have such duties as may be specified by the Chief Financial Officer in the performance of his duties. The Assistant Treasurers shall exercise the power of the Treasurer during that Officer’s absence or inability or refusal to act. Each of the Assistant Treasurers shall possess the same power as the Treasurer to sign all certificates, contracts, obligations and other instruments of the Company. If no Treasurer or Assistant Treasurer is appointed and serving or in the absence of the appointed Treasurer and Assistant Treasurer, any Vice President, or such other Officer as the Board of Directors shall select, shall have the powers and duties conferred upon the Treasurer.

(k) Powers of Attorney. The Company may grant powers of attorney or other authority as appropriate to establish and evidence the authority of the Officers and other persons.

(l) Delegation of Authority. Unless otherwise provided by resolution of the Board of Directors, no Officer shall have the power or authority to delegate to any person such Officer’s rights and powers as an Officer to manage the business and affairs of the Company.

(m) Tenure. The Board of Directors shall appoint Officers of the Company to serve from the date of such appointment until the death, resignation or removal by the Board of Directors with or without cause of such Officer.

6.04 Duties of Officers and Directors. Except as otherwise specifically provided in this Agreement or in the MLP Partnership Agreement, the duties and obligations owed to the Company and to the Board of Directors by the Officers of the Company and by members of the Board of Directors of the Company shall be the same as the respective duties and obligations owed to a corporation organized under the Delaware General Corporation law by its officers and directors, respectively.

6.05 Compensation. The members of the Board of Directors who are neither Officers nor employees of the Company shall be entitled to compensation as directors and committee members as approved by the Board and shall be reimbursed for out-of-pocket expenses incurred in connection with attending meetings of the Board of Directors or committees thereof.

6.06 Indemnification.

(a) To the fullest extent permitted by law but subject to the limitations expressly provided in this Agreement, all Indemnitees shall be indemnified and held harmless by the Company from and against any and all losses, claims, damages, liabilities, joint or several, expenses (including legal fees and expenses), judgments, fines, penalties, interest, settlements or other amounts arising from any and all claims, demands, actions, suits or proceedings, whether civil, criminal, administrative or investigative, in which any Indemnitee may be involved, or is threatened to be involved, as a party or otherwise, by reason of its status as an Indemnitee; provided, that the Indemnitee shall not be indemnified and held harmless if there has been a final and non-appealable judgment entered by a court of competent jurisdiction determining that, in respect of the matter for which the Indemnitee is seeking indemnification pursuant to this Section 6.06, the Indemnitee acted in bad faith or engaged in fraud, willful misconduct or, in the case of a criminal matter, acted with knowledge that the Indemnitee’s conduct was unlawful. Any indemnification pursuant to this Section 6.06 shall be made only out of the assets of the Company, it being agreed that the Members shall not be personally liable for such indemnification and shall have no obligation to contribute or loan any monies or property to the Company to enable it to effectuate such indemnification.

(b) To the fullest extent permitted by law, expenses (including legal fees and expenses) incurred by an Indemnitee who is indemnified pursuant to Section 6.06(a) in defending any claim, demand, action, suit or proceeding shall, from time to time, be advanced by the Company prior to a determination that the Indemnitee is not entitled to be indemnified upon receipt by the Company of any undertaking by or on behalf of the Indemnitee to repay such amount if it shall be determined that the Indemnitee is not entitled to be indemnified as authorized in this Section 6.06(b).

(c) The indemnification provided by this Section 6.06 shall be in addition to any other rights to which an Indemnitee may be entitled under any agreement, as a matter of law or otherwise, both as to actions in the Indemnitee’s capacity as an Indemnitee and as to actions in any other capacity (including any capacity under the Underwriting Agreement (as such term is defined in the Partnership Agreement)), and shall continue as to an Indemnitee who has ceased to serve in such capacity and shall inure to the benefit of the heirs, successors, assigns and administrators of the Indemnitee.

(d) The Company may purchase and maintain (or reimburse the General Partner or its Affiliates for the cost of) insurance on behalf of the Indemnitees, the Company and its Affiliates and such other Persons as the Company shall determine, against any liability that may be asserted against or expense that may be incurred by such Person in connection with the Company’s activities or such Person’s activities on behalf of the Company, regardless of whether the Company would have the power to indemnify such Person against such liability under the provisions of this Agreement.

(e) For purposes of this Section 6.06, the Company shall be deemed to have requested an Indemnitee to serve as fiduciary of an employee benefit plan whenever the performance by it of its duties to the Company also imposes duties on, or otherwise involves services by, it to the plan or participants or beneficiaries of the plan; excise taxes assessed on an Indemnitee with respect to an employee benefit plan pursuant to applicable law shall constitute “fines” within the

meaning of Section 6.06; and action taken or omitted by it with respect to any employee benefit plan in the performance of its duties for a purpose reasonably believed by it to be in the best interest of the participants and beneficiaries of the plan shall be deemed to be for a purpose that is in the best interests of the Company.

(f) In no event may an Indemnitee subject the Members to personal liability by reason of the indemnification provisions set forth in this Agreement.

(g) An Indemnitee shall not be denied indemnification in whole or in part under this Section 6.06 because the Indemnitee had an interest in the transaction with respect to which the indemnification applies if the transaction was otherwise permitted by the terms of this Agreement.

(h) The provisions of this Section 6.06 are for the benefit of the Indemnitees, their heirs, successors, assigns and administrators and shall not be deemed to create any rights for the benefit of any other Persons.

(i) No amendment, modification or repeal of this Section 6.06 or any provision hereof shall in any manner terminate, reduce or impair the right of any past, present or future Indemnitee to be indemnified by the Company, nor the obligations of the Company to indemnify any such Indemnitee under and in accordance with the provisions of this Section 6.06 as in effect immediately prior to such amendment, modification or repeal with respect to claims arising from or relating to matters occurring, in whole or in part, prior to such amendment, modification or repeal, regardless of when such claims may arise or be asserted.

(j) THE PROVISIONS OF THE INDEMNIFICATION PROVIDED IN THIS SECTION 6.06 ARE INTENDED BY THE PARTIES TO APPLY EVEN IF SUCH PROVISIONS HAVE THE EFFECT OF EXCULPATING THE INDEMNITEE FROM LEGAL RESPONSIBILITY FOR THE CONSEQUENCES OF SUCH PERSON’S NEGLIGENCE, FAULT OR OTHER CONDUCT.

6.07 Liability of Indemnitees.

(a) Notwithstanding anything to the contrary set forth in this Agreement or the MLP Agreement, no Indemnitee shall be liable for monetary damages to the Company, the MLP, the Members or any other Person, for losses sustained or liabilities incurred as a result of any act or omission of an Indemnitee unless there has been a final and non-appealable judgment entered by a court of competent jurisdiction determining that, in respect of the matter in question, the Indemnitee acted in bad faith or engaged in fraud, willful misconduct or, in the case of a criminal matter, acted with knowledge that the Indemnitee’s conduct was criminal.

(b) Subject to its obligations and duties as set forth in this Article 6, the Board of Directors and any committee thereof may exercise any of the powers granted to it by this Agreement and perform any of the duties imposed upon it hereunder either directly or by or through the Company’s Officers or agents, and neither the Board of Directors nor any committee thereof

shall be responsible for any misconduct or negligence on the part of any such Officer or agent appointed by the Board of Directors or any committee thereof in good faith.

(c) To the extent that, at law or in equity, an Indemnitee has duties (including fiduciary duties) and liabilities relating thereto to the Company or the Members, such Indemnitee acting in connection with the Company’s business or affairs shall not be liable to the Company or to any Member for its good faith reliance on the provisions of this Agreement.

(d) Any amendment, modification or repeal of this Section 6.07 or any provision hereof shall be prospective only and shall not in any way affect the limitations on the liability of the Indemnitees under this Section 6.07 as in effect immediately prior to such amendment, modification or repeal with respect to claims arising from or relating to matters occurring, in whole or in part, prior to such amendment, modification or repeal, regardless of when such claims may arise or be asserted.

ARTICLE 7
TAX MATTERS

7.01 Tax Returns and Tax Characterization.

(a) The Board of Directors shall cause to be prepared and timely filed (on behalf of the Company) all federal, state and local tax returns required to be filed by the Company, including making all elections on such tax returns. The Company shall bear the costs of the preparation and filing of its returns.

(b) Effective as of July 31, 2013, the Company and Member acknowledge that for federal income tax purposes, the Company has the authority to make an election to be treated as an association taxable as a corporation pursuant to Treasury Regulation §301.7701-3.

ARTICLE 8
BOOKS, RECORDS, REPORTS, AND BANK ACCOUNTS

8.01 Maintenance of Books.

(a) The Board of Directors shall keep or cause to be kept at the principal office of the Company or at such other location approved by the Board of Directors complete and accurate books and records of the Company, supporting documentation of the transactions with respect to the conduct of the Company’s business and minutes of the proceedings of the Board of Directors and any other books and records that are required to be maintained by applicable law.

(b) The books of account of the Company shall be maintained on the basis of a fiscal year that is the calendar year and on an accrual basis in accordance with United States generally accepted accounting principles, consistently applied.

8.02 Reports. The Board of Directors shall cause to be prepared and delivered to each Member such reports, forecasts, studies, budgets and other information as the Members may reasonably request from time to time.

8.03 Bank Accounts. Funds of the Company shall be deposited in such banks or other depositories as shall be designated from time to time by the Board of Directors. All withdrawals from any such depository shall be made only as authorized by the Board of Directors and shall be made only by check, wire transfer, debit memorandum or other written instruction.

ARTICLE 9
DISSOLUTION, WINDING-UP AND TERMINATION

9.01 Dissolution.

(a) Subject to compliance with Section 6.01(c), the Company shall dissolve and its affairs shall be wound up on the first to occur of the following events (each a “Dissolution Event”):

(i) the receipt of Extraordinary Approval;

(ii) the entry of a decree of judicial dissolution of the Company under Section 18-802 of the Delaware Act; and

(iii) at any time there are no Members of the Company, unless the Company is continued in accordance with the Delaware Act or this Agreement.

(b) No other event shall cause a dissolution of the Company.

(c) Upon the occurrence of any event that causes there to be no Members of the Company, to the fullest extent permitted by law, the personal representative of the last remaining Member is hereby authorized to, and shall, within 90 days after the occurrence of the event that terminated the continued membership of such Member in the Company, agree in writing (i) to continue the Company and (ii) to the admission of the personal representative or its nominee or designee, as the case may be, as a substitute Member of the Company, effective as of the occurrence of the event that terminated the continued membership of such Member in the Company.

(d) Notwithstanding any other provision of this Agreement, the Bankruptcy of a Member shall not cause such Member to cease to be a member of the Company, and, upon the occurrence of such an event, the Company shall continue without dissolution.

9.02 Winding-Up and Termination.

(a) On the occurrence of a Dissolution Event, the Board of Directors shall select one or more Persons to act as liquidator. The liquidator shall proceed diligently to wind up the affairs of the Company and make final distributions as provided herein and in the Delaware Act. The costs of winding up shall be borne as a Company expense. Until final distribution, the liquidator shall continue to operate the Company properties with all of the power and authority of the Board of Directors. The steps to be accomplished by the liquidator are as follows:

(i) as promptly as possible after dissolution and again after final winding up, the liquidator shall cause a proper accounting to be made by a recognized firm of certified public

accountants of the Company’s assets, liabilities, and operations through the last calendar day of the month in which the dissolution occurs or the final winding up is completed, as applicable;

(ii) the liquidator shall discharge from Company funds all of the debts, liabilities and obligations of the Company or otherwise make adequate provision for payment and discharge thereof (including the establishment of a cash escrow fund for contingent liabilities in such amount and for such term as the liquidator may reasonably determine); and

(iii) all remaining assets of the Company shall be distributed to the Members as follows:

(A) the liquidator may sell any or all Company property, including to Members; and

(B) Company property (including cash) shall be distributed to the Members.

(b) The distribution of cash or property to a Member in accordance with the provisions of this Section 9.02 constitutes a complete return to the Member of its Capital Contributions and a complete distribution to the Member of its share of all the Company’s property and constitutes a compromise to which all Members have consented within the meaning of Section 18-502(b) of the Delaware Act. No Member shall be required to make any Capital Contribution to the Company to enable the Company to make the distributions described in this Section 9.02.

(c) On completion of such final distribution, the liquidator shall file a certificate of cancellation with the Secretary of State of the State of Delaware and take such other actions as may be necessary to terminate the existence of the Company.

ARTICLE 10
MERGER, CONSOLIDATION OR CONVERSION

10.01 Authority. Subject to compliance with Section 6.01(c), the Company may merge or consolidate with one or more corporations, limited liability companies, statutory trusts or associations, real estate investment trusts, common law trusts or unincorporated businesses, including a partnership (whether general or limited (including a limited liability partnership)) or convert into any such entity, whether such entity is formed under the laws of the State of Delaware or any other state of the United States of America, pursuant to a written agreement of merger or consolidation (“Merger Agreement”) or a written plan of conversion (“Plan of Conversion”), as the case may be, in accordance with this Article 10. The surviving entity to any such merger, consolidation or conversion is referred to herein as the “Surviving Business Entity.”

10.02 Procedure for Merger, Consolidation or Conversion.

(a) The merger, consolidation or conversion of the Company pursuant to this Article 10 requires the prior approval of a majority of the Board of Directors and compliance with Section 10.03.

(b) If the Board of Directors shall determine to consent to a merger or consolidation, the Board of Directors shall approve the Merger Agreement, which shall set forth:

(i) the names and jurisdictions of formation or organization of each of the business entities proposing to merge or consolidate;

(ii) the name and jurisdiction of formation or organization of the Surviving Business Entity that is to survive the proposed merger or consolidation;

(iii) the terms and conditions of the proposed merger or consolidation;

(iv) the manner and basis of exchanging or converting the equity securities of each constituent business entity for, or into, cash, property or interests, rights, securities or obligations of the Surviving Business Entity; and (A) if any general or limited partner interests, securities or rights of any constituent business entity are not to be exchanged or converted solely for, or into, cash, property or general or limited partner interests, rights, securities or obligations of the Surviving Business Entity, the cash, property or interests, rights, securities or obligations of any general or limited partnership, corporation, trust, limited liability company, unincorporated business or other entity (other than the Surviving Business Entity) which the holders of such general or limited partner interests, securities or rights are to receive in exchange for, or upon conversion of their interests, securities or rights, and (B) in the case of securities represented by certificates, upon the surrender of such certificates, which cash, property or general or limited partner interests, rights, securities or obligations of the Surviving Business Entity or any general or limited partnership, corporation, trust, limited liability company, unincorporated business or other entity (other than the Surviving Business Entity), or evidences thereof, are to be delivered;

(v) a statement of any changes in the constituent documents or the adoption of new constituent documents (the articles or certificate of incorporation, articles of trust, declaration of trust, certificate or agreement of limited partnership, certificate of formation, limited liability company agreement or other similar charter or governing document) of the Surviving Business Entity to be effected by such merger or consolidation;

(vi) the effective time of the merger, which may be the date of the filing of the certificate of merger pursuant to Section 10.04 or a later date specified in or determinable in accordance with the Merger Agreement (provided, that if the effective time of the merger is to be later than the date of the filing of such certificate of merger, the effective time shall be fixed at a date or time certain at or prior to the time of the filing of such certificate of merger and stated therein); and

(vii) such other provisions with respect to the proposed merger or consolidation as are deemed necessary or appropriate by the Board of Directors.

(c) If the Board of Directors shall determine to consent to the conversion, the Board of Directors shall approve and adopt a Plan of Conversion containing such terms and conditions that the Board of Directors determines to be necessary or appropriate.

10.03 Approval by Members of Merger or Consolidation.

(a) The Board of Directors, upon its approval of the Merger Agreement or Plan of Conversion, as the case may be, shall direct that the Merger Agreement or the Plan of Conversion, as applicable, be submitted to a vote of the Members, whether at a meeting or by written consent. A copy or a summary of the Merger Agreement or the Plan of Conversion, as applicable, shall be included in or enclosed with the notice of a special meeting or the written consent.

(b) The Merger Agreement or the Plan of Conversion, as applicable, shall be approved upon receiving the affirmative vote or consent of the holders of a majority of the Members.

(c) After such approval by vote or consent of the Members, and at any time prior to the filing of the certificate of merger, consolidation or conversion pursuant to Section 10.04, the merger, consolidation or conversion may be abandoned pursuant to provisions therefor, if any, set forth in the Merger Agreement or the Plan of Conversion, as the case may be.

10.04 Certificate of Merger, Consolidation or Conversion.

(a) Upon the required approval, if any, by the Board of Directors and the Members of a Merger Agreement or a Plan of Conversion, as the case may be, a certificate of merger, consolidation or conversion, as applicable, shall be executed and filed with the Secretary of State of the State of Delaware in conformity with the requirements of the Delaware Act.

(b) At the effective time of the certificate of merger or consolidation:

(i) all of the rights, privileges and powers of each of the business entities that has merged or consolidated, and all property, real, personal and mixed, and all debts due to any of those business entities and all other things and causes of action belonging to each of those business entities shall be vested in the Surviving Business Entity and after the merger or consolidation shall be the property of the Surviving Business Entity to the extent they were property of each constituent business entity;

(ii) the title to any real property vested by deed or otherwise in any of those constituent business entities shall not revert and is not in any way impaired because of the merger or consolidation;

(iii) all rights of creditors and all liens on or security interest in property of any of those constituent business entities shall be preserved unimpaired; and

(iv) all debts, liabilities and duties of those constituent business entities shall attach to the Surviving Business Entity, and may be enforced against it to the same extent as if the debts, liabilities and duties had been incurred or contracted by it.

(i) the Company shall continue to exist, without interruption, but in the organizational form of the converted entity rather than in its prior organizational form;

(ii) all rights, title, and interests to all real estate and other property owned by the Company shall continue to be owned by the converted entity in its new organizational form without reversion or impairment, without further act or deed, and without any transfer or assignment having occurred, but subject to any existing liens or other encumbrances thereon;

(iii) all liabilities and obligations of the Company shall continue to be liabilities and obligations of the converted entity in its new organizational form without impairment or diminution by reason of the conversion;

(iv) all rights of creditors or other parties with respect to or against the prior interest holders or other owners of the Company in their capacities as such in existence as of the effective time of the conversion will continue in existence as to those liabilities and obligations and may be pursued by such creditors and obligees as if the conversion did not occur;

(v) a proceeding pending by or against the Company or by or against any of the Members in their capacities as such may be continued by or against the converted entity in its new organizational form and by or against the prior members without any need for substitution of parties; and

(vi) the Company securities that are to be converted into partnership interests, shares, evidences of ownership, or other securities in the converted entity as provided in the Plan of Conversion or certificate of conversion shall be so converted, and the Members shall be entitled only to the rights provided in the Plan of Conversion or certificate of conversion.

(d) A merger, consolidation or conversion effected pursuant to this Article 10 shall not (i) be deemed to result in a transfer or assignment of assets or liabilities from one entity to another having occurred or (ii) require the Company (if it is not the Surviving Business Entity) to wind up its affairs, pay its liabilities or distribute its assets as required under Article 9 of this Agreement or under the applicable provisions of the Delaware Act.

ARTICLE 11
GENERAL PROVISIONS

11.01 Notices. Except as expressly set forth to the contrary in this Agreement, all notices, requests or consents provided for or permitted to be given under this Agreement must be in writing and must be delivered to the recipient in person, by courier or mail or by facsimile or other electronic transmission and a notice, request or consent given under this Agreement is effective on receipt by the Person to receive it; provided, however, that a facsimile or other electronic transmission that is transmitted after the normal business hours of the recipient shall be deemed effective on the next Business Day. All notices, requests and consents to be sent to a Member must be sent to or made at the addresses given for that Member as that Member may specify by notice to the other Members. Any notice, request or consent to the Company must be given to all of the Members. Whenever any notice is required to be given by applicable law, the Organizational Certificate or this Agreement, a written waiver thereof, signed by the Person entitled to notice, whether before or after the time stated therein, shall be deemed equivalent to the giving of such notice. Whenever any notice is required to be given by law, the Organizational Certificate or this Agreement, a written waiver

thereof, signed by the Person entitled to notice, whether before or after the time stated therein, shall be deemed equivalent to the giving of such notice.

11.02 Entire Agreement; Supersedure. This Agreement constitutes the entire agreement of the Members and their respective Affiliates relating to the subject matter hereof and supersedes all prior contracts or agreements with respect to such subject matter, whether oral or written.

11.03 Effect of Waiver or Consent. Except as provided in this Agreement, a waiver or consent, express or implied, to or of any breach or default by any Person in the performance by that Person of its obligations with respect to the Company is not a consent or waiver to or of any other breach or default in the performance by that Person of the same or any other obligations of that Person with respect to the Company. Except as provided in this Agreement, failure on the part of a Person to complain of any act of any Person or to declare any Person in default with respect to the Company, irrespective of how long that failure continues, does not constitute a waiver by that Person of its rights with respect to that default until the applicable statute-of-limitations period has run.

11.04 Amendment or Restatement. This Agreement may be amended or restated only by a written instrument executed by all Members.

11.05 Binding Effect. This Agreement is binding on and shall inure to the benefit of the Members and their respective heirs, legal representatives, successors and assigns.

11.06 Governing Law; Severability. THIS AGREEMENT IS GOVERNED BY AND SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF DELAWARE, EXCLUDING ANY CONFLICT-OF-LAWS RULE OR PRINCIPLE THAT MIGHT REFER THE GOVERNANCE OR THE CONSTRUCTION OF THIS AGREEMENT TO THE LAW OF ANOTHER JURISDICTION. In the event of a direct conflict between the provisions of this Agreement and (a) any provision of the Organizational Certificate, or (b) any mandatory, non-waivable provision of the Delaware Act, such provision of the Organizational Certificate or the Delaware Act shall control. If any provision of the Delaware Act provides that it may be varied or superseded in the limited liability company agreement (or otherwise by agreement of the members or managers of a limited liability company), such provision shall be deemed superseded and waived in its entirety if this Agreement contains a provision addressing the same issue or subject matter. If any provision of this Agreement or the application thereof to any Person or circumstance is held invalid or unenforceable to any extent, (a) the remainder of this Agreement and the application of that provision to other Persons or circumstances is not affected thereby and that provision shall be enforced to the greatest extent permitted by law, and (b) the Members or Directors (as the case may be) shall negotiate in good faith to replace that provision with a new provision that is valid and enforceable and that puts the Members in substantially the same economic, business and legal position as they would have been in if the original provision had been valid and enforceable.

11.07 Further Assurances. In connection with this Agreement and the transactions contemplated hereby, each Member shall execute and deliver any additional documents and instruments and perform any additional acts that may be necessary or appropriate to effectuate and perform the provisions of this Agreement and those transactions.

11.08 Offset. Whenever the Company is to pay any sum to any Member, any amounts that a Member owes the Company may be deducted from that sum before payment.

11.09 Counterparts. This Agreement may be executed in any number of counterparts, including facsimile or e-mail counterparts, with the same effect as if all signing parties had signed the same document. All counterparts shall be construed together and constitute the same instrument.

[Signature Page Follows]

IN WITNESS WHEREOF, this Agreement has been duly executed by the sole Member as of the date first set forth above.

MEMBER:

SPECTRA ENERGY SOUTHEAST PIPELINE CORPORATION

By: /s/ Patricia M. Rice

Name: Patricia M. Rice

Title: Vice President and Secretary

[SIGNATURE PAGE TO FOURTH AMENDED AND RESTATED

LIMITED LIABILITY COMPANY AGREEMENT]

Attachment I

Defined Terms

Affiliate – with respect to any Person, each Person Controlling, Controlled by or under common Control with such first Person.

Agreement – this Fourth Amended and Restated Limited Liability Company Agreement of Spectra Energy Partners GP, LLC, as the same may be amended, modified, supplemented or restated from time to time.

Audit Committee – Section 6.02(e).

Available Cash – as of any Distribution Date, (a) all cash and cash equivalents of the Company on hand on such date, less (b) the amount of any cash reserves determined to be appropriate by the Board of Directors.

Bankruptcy or Bankrupt – with respect to any Person, that (a) such Person (i) makes an assignment for the benefit of creditors; (ii) files a voluntary petition in bankruptcy; (iii) is insolvent, or has entered against such Person an order for relief in any bankruptcy or insolvency proceeding; (iv) files a petition or answer seeking for such Person any reorganization, arrangement, composition, readjustment, liquidation, dissolution or similar relief under any law; (v) files an answer or other pleading admitting or failing to contest the material allegations of a petition filed against such Person in a proceeding of the type described in subclauses (i) through (iv) of this clause (a); or (vi) seeks, consents to or acquiesces in the appointment of a trustee, receiver or liquidator of such Person or of all or any substantial part of such Person’s properties; or (b) 120 Days have passed after the commencement of any proceeding seeking reorganization, arrangement, composition, readjustment, liquidation, dissolution or similar relief under any law, if the proceeding has not been dismissed, or 90 Days have passed after the appointment without such Person’s consent or acquiescence of a trustee, receiver or liquidator of such Person or of all or any substantial part of such Person’s properties, if the appointment is not vacated or stayed, or 90 Days have passed after the date of expiration of any such stay, if the appointment has not been vacated.

Board of Directors or Board – Section 6.01(a).

Business Day – any Day other than a Saturday, a Sunday or a Day on which national banking associations in the State of Texas are authorized or required by law to close.

Capital Contribution – Section 4.01(a).

Class B Units – has the meaning ascribed to such term in the MLP Partnership Agreement.

Commitment – means (a) options, warrants, convertible securities, exchangeable securities, subscription rights, conversion rights, exchange rights, or other contracts, agreements or commitments that could require a Person to issue any of its Equity Interests or to sell any

A-1

Equity Interests it owns in another Person; (b) any other securities convertible into, exchangeable or exercisable for, or representing the right to subscribe for any Equity Interest of a Person or owned by a Person; (c) statutory or contractual pre-emptive rights or pre-emptive rights granted under a Person’s organizational or constitutive documents; and (d) stock appreciation rights, phantom stock, profit participation, or other similar rights with respect to a Person.

Common Unit – has the meaning ascribed to such term in the MLP Partnership Agreement.

Company – initial paragraph of this Agreement.

Conflicts Committee – Section 6.02(e)(ii).

Contribution Agreement – has the meaning ascribed to such term in the MLP Partnership Agreement.

Control – means the possession, directly or indirectly, of the power and authority to direct or cause the direction of the management and policies of a Person, whether through ownership or control of Voting Stock, by contract or otherwise.

Day – a calendar day; provided, however, that, if any period of Days referred to in this Agreement shall end on a Day that is not a Business Day, then the expiration of such period shall be automatically extended until the end of the first succeeding Business Day.

Delaware Act – the Delaware Limited Liability Company Act and any successor statute, as amended from time to time.

Delaware General Corporation Law – Title 8 of the Delaware Code, as amended from time to time.

Delegation of Authority Policy– means the Delegation of Authority Policy adopted by the Board of Directors on November 1, 2013, as amended from time to time.

Director – each member of the Board of Directors elected as provided in Section 6.02.

Dissolution Event – Section 9.01(a).

Distribution Date – Section 5.01.

Effective Date – initial paragraph of this Agreement.

Equity Interest – (a) with respect to a corporation, any and all shares of capital stock and any Commitments with respect thereto, (b) with respect to a partnership, limited liability company, trust or similar Person, any and all units, interests or other partnership, limited liability company, trust or similar interests, and any Commitments with respect thereto, and (c) any other direct or indirect equity ownership or participation in a Person (including any incentive distribution rights).

A-2

Existing Agreement – Recitals.

Extraordinary Approval – written approval of SESPC.

Group Member – means any of the MLP and its Subsidiaries.

Incentive Distribution Rights – has the meaning ascribed thereto in the MLP Partnership Agreement.

Indemnitee – each of (a) the Members, (b) any Person who is or was an Affiliate of the Company (other than SEP GP or any Group Member), (c) any Person who is or was a member, partner, director, officer, fiduciary or trustee of the Company or any Affiliate of the Company, (d) any Person who is or was serving at the request of the Company or any Affiliate of the Company as an officer, director, member, partner, fiduciary or trustee of another Person; provided that a Person shall not be an Indemnitee by reason of providing, on a fee-for-services basis, trustee, fiduciary or custodial services, and (e) any Person the Company designates as an “Indemnitee” for purposes of this Agreement.

Independent Director – Section 6.02(a).

Liability – any liability or obligation, whether known or unknown, asserted or unasserted, absolute or contingent, matured or unmatured, conditional or unconditional, latent or patent, accrued or unaccrued, liquidated or unliquidated, or due or to become due.

Member – any Person executing this Agreement as of the date of this Agreement as a member or hereafter admitted to the Company as a member as provided in this Agreement, but such term does not include any Person who has ceased to be a member in the Company.

Membership Interest – with respect to any Member, (a) that Member’s status as a Member; (b) that Member’s share of the income, gain, loss, deduction and credits of, and the right to receive distributions from, the Company; (c) all other rights, benefits and privileges enjoyed by that Member (under the Delaware Act, this Agreement or otherwise) in its capacity as a Member; and (d) all obligations, duties and liabilities imposed on that Member (under the Delaware Act, this Agreement or otherwise) in its capacity as a Member, including any obligations to make Capital Contributions.

Merger Agreement – Section 10.01.

MLP – Spectra Energy Partners, LP, a Delaware limited partnership.

MLP Interests – the limited partner interests of the MLP, regardless of class or category of limited partner interests.

MLP Partnership Agreement – the First Amended and Restated Agreement of Limited Partnership of the MLP, dated July 2, 2007, as amended, supplemented, amended and restated, or otherwise modified from time to time.

A-3

National Securities Exchange – has the meaning ascribed to such term in the MLP Partnership Agreement.

Officers – any person elected as an officer of the Company as provided in Section 6.03(a), but such term does not include any person who has ceased to be an officer of the Company.

Omnibus Agreement – the Omnibus Agreement, dated July 2, 2007, among the Company, SEP GP, the MLP and Spectra Energy Corp, as amended, supplemented, amended and restated, or otherwise modified from time to time.

Organizational Certificate – Section 2.01.

Partnership Securities – has the meaning ascribed to such term in the MLP Partnership Agreement.

Person – a natural person, partnership (whether general or limited), limited liability company, governmental entity, trust, estate, association, corporation, venture, custodian, nominee or any other individual or entity in its own or any representative capacity.

Plan of Conversion – Section 10.01.

Quarter – unless the context requires otherwise, a calendar quarter.

SEC – the United States Securities and Exchange Commission.

SEP GP – Spectra Energy Partners (DE) GP, LP, as the general partner of the MLP.

SEP GP Agreement – the First Amended and Restated Agreement of Limited Partnership of Spectra Energy Partners (DE) GP, LP, dated effective as of July 2, 2007, as amended, supplemented, amended and restated, or otherwise modified from time to time.

SESPC –initial paragraph of this Agreement.

SET – Recitals of this Agreement.

Special Approval – approval by a majority of the members of the Conflicts Committee acting in good faith.

Subsidiary – with respect to any relevant Person, (a) a corporation of which more than 50% of the Voting Stock is owned, directly or indirectly, at the date of determination, by such relevant Person, by one or more Subsidiaries of such relevant Person or a combination thereof, (b) a partnership (whether general or limited) in which such relevant Person, one or more Subsidiaries of such relevant Person or a combination thereof is, at the date of determination, a general or limited partner of such partnership, but only if more than 50% of the partnership interests of such partnership (considering all of the partnership interests of the partnership as a single class) is owned, directly or indirectly, at the date of determination, by such relevant Person, by one or more Subsidiaries of such relevant Person, or a combination thereof, or (c) any

A-4

other Person (other than a corporation or a partnership) in which such relevant Person, one or more Subsidiaries of such relevant Person, or a combination thereof, directly or indirectly, at the date of determination, has (i) at least a majority ownership interest or (ii) the power to elect or direct the election of a majority of the directors or other governing body of such other Person.

Surviving Business Entity – Section 10.01.

Underwriting Agreement – has the meaning ascribed to such term in the MLP Partnership Agreement. Units – has the meaning ascribed to such term in the MLP Partnership Agreement.

Voting Stock – with respect to any Person, Equity Interests in such Person, the holders of which are ordinarily, in the absence of contingencies, entitled to vote for the election of, or otherwise appoint, directors (or Persons with management authority performing similar functions) of such Person.

Withdraw, Withdrawing and Withdrawal – the withdrawal, resignation or retirement of a Member from the Company as a Member.

A-5

EXHIBIT 31.1

CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Gregory L. Ebel, certify that:


1)	I have reviewed this quarterly report on Form 10-Q of Spectra Energy Partners, LP;


2)	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;


3)	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;


4)	The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:


a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;


b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;


c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and


d)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and


5)	The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):


a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and


b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.



Date: November 5, 2015			/s/ Gregory L. Ebel
			Gregory L. Ebel President and Chief Executive Officer Spectra Energy Partners GP, LLC General Partner of Spectra Energy Partners (DE) GP, LP General Partner of Spectra Energy Partners, LP

EXHIBIT 31.2

CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, J. Patrick Reddy, certify that:


1)	I have reviewed this quarterly report on Form 10-Q of Spectra Energy Partners, LP;


2)	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;


3)	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;


4)	The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:


a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;


b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;


c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and


d)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and


5)	The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):


a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and


b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.



Date: November 5, 2015			/s/ J. Patrick Reddy
			J. Patrick Reddy Chief Financial Officer Spectra Energy Partners GP, LLC General Partner of Spectra Energy Partners (DE) GP, LP General Partner of Spectra Energy Partners, LP

EXHIBIT 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Spectra Energy Partners, LP on Form 10-Q for the period ending September 30, 2015 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Gregory L. Ebel, President and Chief Executive Officer of Spectra Energy Partners GP, LLC, general partner of Spectra Energy Partners (DE) GP, LP, general partner of Spectra Energy Partners, LP, certify, pursuant to 18 U.S.C. section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002, that:


(1)	The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and


(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Spectra Energy Partners, LP.



Date: November 5, 2015			/s/ Gregory L. Ebel
			Gregory L. Ebel President and Chief Executive Officer Spectra Energy Partners GP, LLC General Partner of Spectra Energy Partners (DE) GP, LP General Partner of Spectra Energy Partners, LP

EXHIBIT 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Spectra Energy Partners, LP on Form 10-Q for the period ending September 30, 2015 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, J. Patrick Reddy, Chief Financial Officer of Spectra Energy Partners GP, LLC, general partner of Spectra Energy Partners (DE) GP, LP, general partner of Spectra Energy Partners, LP, certify, pursuant to 18 U.S.C. section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002, that:


(1)	The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and


(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Spectra Energy Partners, LP.



Date: November 5, 2015			/s/ J. Patrick Reddy
			J. Patrick Reddy Chief Financial Officer Spectra Energy Partners GP, LLC General Partner of Spectra Energy Partners (DE) GP, LP General Partner of Spectra Energy Partners, LP

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