DCP MIDSTREAM PARTNERS, LP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Years Ended December 31, 2011, 2010 and 2009 — (Continued)
construct the Keathley Canyon Connector, a 20-inch diameter, 215-mile subsea natural gas gathering pipeline
for production from the Keathley Canyon, Walker Ridge and Green Canyon areas in the central deepwater Gulf
of Mexico. The Keathley Canyon Connector will originate in the southeast portion of the Keathley Canyon area
and terminate into Discovery’s 30-inch diameter mainline near South Timbalier Block 283. The pipeline will be
capable of gathering more than 400 MMcf/d of natural gas. Discovery has signed long-term fee-based
agreements with the Lucius and Hadrian South owners for natural gas gathering and processing for production
from those fields. Construction on the project is expected to begin in 2013, with a mid-2014 expected in-service
date. Total capital expenditures for the Keathley Canyon Connector are estimated to be approximately $600
million.
On January 26, 2012, the board of directors of the general partner declared a quarterly distribution of $0.65
per unit, payable on February 14, 2012 to unitholders of record on February 7, 2012.
On February 27, 2012, we entered into agreements with DCP Midstream, LLC, to acquire the remaining
66.67% interest in Southeast Texas, and natural gas commodity derivatives associated with the storage
business, for aggregate consideration of $240.0 million, subject to certain working capital and other customary
purchase price adjustments. DCP Midstream, LLC also provided fixed price NGL commodity derivatives for
the three year period subsequent to closing the newly acquired interest. Prior to the acquisition of the additional
interest in Southeast Texas, we owned a 33.33% interest which we account for as an unconsolidated affiliate
using the equity method. The acquisition of the remaining 66.67% interest in Southeast Texas represents a
transaction between entities under common control and a change in reporting entity. Accordingly, we will
include the results of the remaining 66.67% interest in Southeast Texas retrospectively similar to the pooling
method. This acquisition is expected to close by the second quarter of 2012.
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