Breitburn Energy Partners LP (NASDAQ:BBEP) today announced financial and operating results for the third quarter 2015.

Key Highlights

  • Reported third quarter total production of 5 MMBoe, in line with Breitburn's guidance.
  • Reported pre-tax lease operating expenses of $99.3 million, or $19.83 per Boe, in line with Breitburn's guidance.
  • Reported Adjusted EBITDA, a non-GAAP financial measure, of $156.3 million.
  • Reported G&A expenses, excluding unit-based compensation, of $16.9 million in the third quarter compared to $16.8 million in the second quarter. Excluding $3.1 million of integration and acquisition costs in the third quarter and $2.7 million of integration and acquisition costs in the second quarter, G&A expenses improved to $2.76 per Boe in the third quarter compared to $2.81 per Boe in the second quarter.
  • Reported distributable cash flow of $51.5 million, or $0.24 per common unit, and distribution coverage ratio of 1.9x based on current monthly distribution of $0.04166 per common unit, or $0.50 per common unit on an annualized basis.
  • Based on Breitburn's current commodity hedge portfolio and assuming second half 2015 guidance production rate, total estimated production is 77% hedged for the remainder of 2015, 72% in 2016, and 45% in 2017 at attractive prices. The estimated value of Breitburn's commodity hedge portfolio was approximately $668 million as of September 30th.
  • Borrowing base of $1.8 billion on bank credit facility remains unchanged through April 2016, resulting in liquidity of approximately $526 million as of quarter end.

Management Commentary

Halbert S. Washburn, Breitburn’s Chief Executive Officer, said: "I am pleased with our third straight quarter of solid operating results since we acquired QR Energy last November. Our production is on track to achieve our 20 million Boe full year 2015 production target with our reduced $200 million capital program. We remain focused on reducing our lease operating and G&A expenses, and those third quarter results are in line with our expectations. Earlier this year, we laid out a strategy of operating within our cash flow, reducing and high grading capital spending, lowering operating and G&A costs, decreasing debt, and increasing liquidity, and we continue to execute on all aspects of our plan."

Third Quarter 2015 Operating and Financial Results Compared to Second Quarter 2015

  • Total production was 5,008 MBoe in the third quarter of 2015 compared to 5,015 MBoe in the second quarter of 2015. Average daily production was 54.4 MBoe/day in the third quarter of 2015 compared to 55.1 MBoe/day in the second quarter of 2015.
    • Oil production decreased to 2,741 MBbl compared to 2,822 MBbl in the second quarter of 2015.
    • NGL production increased to 485 MBbl compared to 483 MBbl in the second quarter of 2015.
    • Natural gas production increased to 10,689 MMcf compared to 10,264 MMcf in the second quarter of 2015.
  • Adjusted EBITDA was $156.3 million in the third quarter of 2015 compared to $162.9 million (including $1.1 million of restructuring costs) in the second quarter of 2015, a 4% decrease primarily due to lower commodity prices, lower oil production, and one less Florida oil shipment, partially offset by higher commodity derivative settlements and higher gas production.
  • Net loss attributable to common unitholders was $1,339 million, or $6.17 per diluted common unit, in the third quarter of 2015, which included non-cash impairments of long-lived assets of $1,440 million, or $6.80 per unit, primarily related to the impact of the drop in commodity prices on our projected net revenues for certain of our oil and gas properties, compared to net loss of $316.2 million, or $1.46 per diluted common unit, in the second quarter of 2015, which included a non-cash goodwill impairment charge of approximately $95.9 million, or $0.45 per unit.
  • Oil, NGL and natural gas sales revenues were $153.3 million in the third quarter of 2015 compared to $189.6 million in the second quarter of 2015, primarily reflecting lower realized oil and NGL prices, lower oil production, and one less Florida oil shipment, partially offset by higher gas production.
  • Lease operating expenses, which include district expenses, processing fees and transportation costs but exclude taxes, were $19.83 per Boe in the third quarter of 2015 compared to $18.72 per Boe in the second quarter of 2015, a 6% increase primarily due to additional spending of $5 million for a well reactivation program in the Midland Basin.
  • General and administrative expenses, excluding non-cash unit-based compensation costs, were $16.9 million in the third quarter of 2015 compared to $16.8 million in the second quarter of 2015. Excluding $3.1 million of integration and acquisition costs in the third quarter and $2.7 million of integration and acquisition costs in the second quarter, G&A expenses improved to $13.8 million, or $2.76 per Boe, in the third quarter compared to $14.1 million, or $2.81 per Boe, in the second quarter.
  • Gains on commodity derivative instruments were $253 million in the third quarter of 2015 compared to losses of $93.4 million in the second quarter of 2015, primarily due to a decrease in oil and natural gas futures prices during the third quarter of 2015. Derivative instrument settlement receipts were $129 million in the third quarter of 2015 compared to receipts of $100.6 million in the second quarter of 2015, primarily due to lower oil prices.
  • NYMEX WTI oil spot prices averaged $46.64 per Bbl and Brent oil spot prices averaged $50.41 per Bbl in the third quarter of 2015 compared to $57.85 per Bbl and $61.65 per Bbl, respectively, in the second quarter of 2015. Henry Hub natural gas spot prices averaged $2.76 per Mcf in the third quarter of 2015 compared to $2.75 per Mcf in the second quarter of 2015.
  • Average realized crude oil, NGL and natural gas prices, excluding the effects of commodity derivative settlements, were $43.38 per Bbl, $12.44 per Bbl and $2.76 per Mcf, respectively, in the third quarter of 2015 compared to $53.29 per Bbl, $18.35 per Bbl and $2.57 per Mcf, respectively, in the second quarter of 2015.
  • Oil, NGL and natural gas capital expenditures were $46 million in the third quarter of 2015 compared to $58 million in the second quarter of 2015.
  • Distributable cash flow, a non-GAAP financial measure, was $51.5 million in the third quarter of 2015 compared to $58.5 million in the second quarter of 2015.

Impact of Derivative Instruments

Breitburn uses commodity derivative instruments to mitigate risks associated with commodity price volatility and to help maintain cash flows for operating activities, acquisitions, capital expenditures and distributions. Breitburn does not enter into derivative instruments for speculative trading purposes. Since Breitburn does not use hedge accounting to account for its derivative instruments, changes in the fair value of derivative instruments are recorded in Breitburn’s earnings during each reporting period. These non-cash changes in the fair value of derivatives do not affect Adjusted EBITDA, cash flow from operations, distributable cash flow or Breitburn’s ability to pay cash distributions for the reporting periods presented.

Production, Statement of Operations, and Realized Price Information

The following table presents production, selected income statement and realized price information for the three months ended September 30, 2015 and 2014, and the three months ended June 30, 2015:

    Three Months Ended September 30,     June 30,     September 30, Thousands of dollars, except as indicated 2015 2015 2014 Oil sales $ 117,743 $ 154,425 $ 176,986 NGL sales 6,032 8,861 9,582 Natural gas sales 29,550 26,350 29,578 Gain (loss) on commodity derivative instruments 253,012 (93,432 ) 146,171

Other revenues, net (a)

5,922   6,504   1,585 Total revenues $ 412,259   $ 102,708   $ 363,902 Lease operating expenses before taxes (b) $ 99,318 $ 93,858 $ 62,714 Production and property taxes (c) 13,249   15,348   16,327 Total lease operating expenses 112,567   109,206   79,041 Purchases and other operating costs 367 421 102 Salt water disposal costs 4,205 4,053 — Change in inventory (2,004 ) 2,157   3,761 Total operating costs $ 115,135   $ 115,837   $ 82,904 Lease operating expenses before taxes per Boe (b) $ 19.83 $ 18.72 $ 18.70 Production and property taxes per Boe (c) 2.65   3.06   4.87 Total lease operating expenses per Boe $ 22.48   $ 21.78   $ 23.57 General and administrative expenses (excluding non-cash unit-based compensation) $ 16,916   $ 16,778   $ 12,908 Net (loss) income attributable to the partnership $ (1,327,929 ) $ (305,707 ) $ 130,643 Less: Distributions to Series A preferred unitholders 4,125 4,125 4,125 Less: Non-cash distributions to Series B preferred unitholders 7,145 6,408 — Less: Net (loss) income attributable to participating units (31,662 ) (7,858 ) 1,868 Net (loss) income attributable to common unitholders $ (1,307,537 ) $ (308,382 ) $ 124,650   Total production (MBoe) (d) 5,008 5,015 3,353 Oil (MBbl) 2,741 2,822 1,904 NGLs (MBbl) 485 483 253 Natural gas (MMcf) 10,689 10,264 7,178 Average daily production (Boe/d) 54,435   55,110   36,450 Sales volumes (MBoe) (e) 4,980   5,089   3,412 Average realized sales price (per Boe) (f) (g) $ 30.78 $ 37.24 $ 63.33 Oil (per Bbl) (f) (g) 43.38 53.29 90.12 NGLs (per Bbl) (f) 12.44 18.35 37.87 Natural gas (per Mcf) (f) $ 2.76   $ 2.57   $ 4.12 (a)   Includes revenue from the East Texas Salt Water Disposal System of $4.1 million, $4.0 million and zero for the three months ended September 30, 2015, June 30, 2015, and September 30, 2014, respectively. (b) Includes district expenses, processing fees and transportation costs. (c) Includes ad valorem and severance taxes. (d) Natural gas is converted on the basis of six Mcf of gas per one Bbl of oil equivalent. This ratio reflects an energy content equivalency and not a price or revenue equivalency. Given commodity price disparities, the price for a Bbl of oil equivalent for natural gas is significantly less than the price for a Bbl of oil. (e) Oil sales were 2,713 MBbl, 2,896 MBbl and 1,964 MBbl for the three months ended September 30, 2015, June 30, 2015 and September 30, 2014, respectively. (f) Excludes the effect of commodity derivative settlements. (g) Includes the per Boe effect of crude oil purchases.  

Non-GAAP Financial Measures

This press release, including the financial tables and other supplemental information, including the reconciliations of certain non-generally accepted accounting principles (“non-GAAP”) measures to their nearest comparable generally accepted accounting principles (“GAAP”) measures, may be used periodically by management when discussing Breitburn’s financial results with investors and analysts, and they are also available at www.breitburn.com.

“Adjusted EBITDA” and “distributable cash flow” are among the non-GAAP financial measures used in this press release. These non-GAAP financial measures should not be considered as alternatives to GAAP measures such as net income, operating income, cash flow from operating activities or any other GAAP measure of liquidity or financial performance. Management believes that these non-GAAP financial measures enhance comparability to prior periods.

Adjusted EBITDA is presented because management believes it provides additional information relative to the performance of Breitburn’s assets, without regard to financing methods or capital structure. Distributable cash flow is used by management as a tool to measure the cash distributions we could pay to our unitholders, and this financial measure indicates to investors whether or not we are generating cash flow at a level that can support our distribution rate to our unitholders. These non-GAAP financial measures may not be comparable to similarly titled measures of other publicly traded partnerships or limited liability companies because all companies may not calculate Adjusted EBITDA or distributable cash flow in the same manner.

Adjusted EBITDA

The following table presents a reconciliation of net loss and net cash flows from operating activities, our most directly comparable GAAP financial performance and liquidity measures, to Adjusted EBITDA for each of the periods indicated.

    Three Months Ended September 30,     June 30,     September 30, Thousands of dollars, except as indicated 2015 2015 2014 Reconciliation of net income to Adjusted EBITDA: Net (loss) income attributable to the partnership $ (1,327,929 ) $ (305,707 ) $ 130,643 Gain (loss) on commodity derivative instruments (253,012 ) 93,432 (146,171 ) Commodity derivative instrument settlement receipts (payments) (a) (b) 128,969 100,576 (3,704 ) Depletion, depreciation and amortization expense 117,464 109,447 72,671 Impairments of oil and natural gas properties 1,440,167 — 29,434 Impairments of goodwill — 95,947 — Interest expense and other financing costs 51,915 62,007 29,494 (Gain) loss on sale of assets (7,459 ) 122 (63 ) Income tax expense 14 259 532 Unit-based compensation expense (c) 6,360 6,084 5,829 Restructuring costs - unit-based compensation (192 ) 721   —   Adjusted EBITDA $ 156,297 $ 162,888 $ 118,665 Less: Maintenance capital (d) $ 52,000 $ 52,000 $ 33,434 Cash interest expense 48,654 48,250 27,849 Distributions to Series A preferred unitholders (e) 4,125   4,125   4,125   Distributable cash flow available to common unitholders $ 51,518   $ 58,513   $ 53,257     Distributable cash flow available per common unit (f) $ 0.237 $ 0.270 $ 0.390 Common unit distribution coverage (g) 1.90x 2.16x 0.78x   Reconciliation of net cash flows from operating activities to Adjusted EBITDA:   Net cash provided by operating activities $ 136,239 $ 73,796 $ 103,807 Increase (decrease) in assets net of liabilities relating to operating activities (29,063 ) 40,736 (13,160 ) Interest expense (h) 48,562 48,197 27,729 Income from equity affiliates, net 163 172 191 Noncontrolling interest (91 ) (126 ) — Income taxes 488 259 98 Gain on marketable securities —   (146 ) —   Adjusted EBITDA $ 156,297   $ 162,888   $ 118,665   (a)   Excludes premiums paid at contract inception related to those derivative contracts that settled during the applicable periods of: $ 1,681 $ 1,663

$

2,141

(b) Includes net cash settlements on derivative instruments for: - Oil settlements received (paid): $ 112,437 $ 83,265

$

(7,940

) - Natural gas settlements received: $ 16,532 $ 17,311

$

4,236

(c) Represents non-cash long-term unit-based incentive compensation expense. (d) Maintenance capital is management's estimate of the investment in capital projects and obligatory spending on existing facilities and operations needed to hold production approximately flat over a multi-year period. (e) Does not include paid-in-kind distributions on Series B Preferred Units. (f) Based on common units outstanding (including outstanding LTIP grants) at each distribution record date within the periods. (g) Does not include Series B Preferred Units on an as converted basis. (h) Excludes amortization of debt issuance costs and amortization of senior note discount/premium.  

Summary of Commodity Derivative Instruments

The table below summarizes Breitburn’s commodity derivative hedge portfolio as of November 5, 2015. For an overview of Breitburn's commodity hedge portfolio, please refer to the Summary of Commodity Price Protection Portfolio at www.breitburn.com.

    Year 2015     2016     2017     2018       2019 Oil Positions: Fixed Price Swaps - NYMEX WTI Volume (Bbl/d) 20,043 17,504 14,519 1,493 1,000 Average Price ($/Bbl) $ 93.27 $ 83.62 $ 82.81 $ 64.02 $ 56.35 Fixed Price Swaps - ICE Brent Volume (Bbl/d) 3,300 4,300 298 — — Average Price ($/Bbl) $ 97.73 $ 95.17 $ 97.50 $ — $ — Collars - NYMEX WTI Volume (Bbl/d) 2,025 1,500 — — — Average Floor Price ($/Bbl) $ 90.00 $ 80.00 $ — $ — $ — Average Ceiling Price ($/Bbl) $ 111.73 $ 102.00 $ — $ — $ — Collars - ICE Brent Volume (Bbl/d) 500 500 — — — Average Floor Price ($/Bbl) $ 90.00 $ 90.00 $ — $ — $ —

Average Ceiling Price ($/Bbl)

$ 109.50 $ 101.25 $ — $ — $ — Puts - NYMEX WTI Volume (Bbl/d) 500 1,000 — — — Average Price ($/Bbl) $ 90.00 $ 90.00 $ — $ — $ — Total: Volume (Bbl/d) 26,368 24,804 14,817 1,493 1,000 Average Price ($/Bbl) $ 93.46 $ 85.79 $ 83.11 $ 64.02 $ 56.35   Gas Positions: Fixed Price Swaps - MichCon City-Gate Volume (MMBtu/d) 17,500 29,000 24,000 17,500 10,000 Average Price ($/MMBtu) $ 4.26 $ 3.91 $ 3.71 $ 3.10 $ 3.15 Fixed Price Swaps - Henry Hub Volume (MMBtu/d) 54,891 42,050 21,016 2,870 — Average Price ($/MMBtu) $ 4.84 $ 4.02 $ 4.29 $ 3.74 $ — Collars - Henry Hub Volume (MMBtu/d) 18,000 630 595 — — Average Floor Price ($/MMBtu) $ 5.00 $ 4.00 $ 4.00 $ — $ — Average Ceiling Price ($/MMBtu) $ 7.48 $ 5.55 $ 6.15 $ — $ — Puts - Henry Hub Volume (MMBtu/d) 1,920 11,350 10,445 — — Average Price ($/MMBtu) $ 4.78 $ 4.00 $ 4.00 $ — $ — Deferred Premium ($/MMBtu) $

0.64

(a) $ 0.66 (b) $ 0.69 (c) $ — $ — Total: Volume (MMBtu/d) 92,311 83,030 56,056 20,370 10,000 Average Price ($/MMBtu) $ 4.76 $ 3.98 $ 3.98 $ 3.19 $ 3.15 (a)   Deferred premiums of $0.64 apply to 420 MMBtu/d of the 2015 volume. (b) Deferred premiums of $0.66 apply to 11,350 MMBtu/d of the 2016 volume. (c) Deferred premiums of $0.69 apply to 10,445 MMBtu/d of the 2017 volume.  

Premiums paid in 2012 related to oil and natural gas derivatives to be settled after September 30, 2015, are as follows:

        Year Thousands of dollars 2015     2016     2017 Oil $ 1,180 $ 7,438 $ 734 Natural gas $ 501 $ 952 $ —  

Other Information

Breitburn will host a conference call Thursday, November 5, 2015, at 11:00 am (EST) to discuss Breitburn’s third quarter 2015 results. The conference call may be accessed by calling 888-389-5988 (international callers dial 719-325-2464) or via webcast at http://ir.breitburn.com/. An archived edition of the conference call will also be available through November 12th by calling 877-870-5176 (international callers dial 858-384-5517) and entering replay PIN 9034747 or by visiting http://ir.breitburn.com/. Breitburn will take questions from securities analysts and institutional portfolio managers; the call is open to all other interested parties on a listen-only basis.

About Breitburn Energy Partners LP

Breitburn Energy Partners LP is a publicly traded, independent oil and gas master limited partnership focused on the acquisition, development, and production of oil and gas properties throughout the United States. Breitburn’s producing and non-producing crude oil and natural gas reserves are located in the following seven producing areas: Ark-La-Tex, Michigan/Indiana/Kentucky, the Permian Basin, the Mid-Continent, the Rockies, Florida, and California. See www.breitburn.com for more information.

Cautionary Statement Regarding Forward-Looking Information

This press release contains forward-looking statements relating to Breitburn's operations that are based on management’s current expectations, estimates and projections about its operations. Words and phrases such as “believes,” “expect,” “future,” “impact,” “guidance,” “will be,” and variations of such words and similar expressions are intended to identify such forward-looking statements. These statements are not guarantees of future performance and are subject to certain risks, uncertainties and other factors, some of which are beyond our control and are difficult to predict. These include risks relating to Breitburn's financial performance and results, availability of sufficient cash flow and other sources of liquidity to execute our business plan, prices and demand for natural gas and oil, increases in operating costs, uncertainties inherent in estimating our reserves and production, our ability to replace reserves and efficiently develop our current reserves, political and regulatory developments relating to taxes, derivatives and our oil and gas operations, risks relating to our acquisitions and the factors set forth under the heading “Risk Factors” incorporated by reference from our Annual Report on Form 10-K filed with the Securities and Exchange Commission, and if applicable, our Quarterly Reports on Form 10-Q and our Current Reports on Form 8-K. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements. The reader should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Unless legally required, Breitburn undertakes no obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise. Unpredictable or unknown factors not discussed herein also could have material adverse effects on forward-looking statements.

BBEP-IR

  Breitburn Energy Partners LP and Subsidiaries Unaudited Consolidated Balance Sheets       September 30,     December 31, Thousands of dollars 2015 2014 ASSETS Current assets Cash $ 12,091 $ 12,628 Accounts and other receivables, net 135,479 166,436 Derivative instruments 400,857 408,151 Related party receivables 2,069 2,462 Inventory 3,371 3,727 Prepaid expenses 12,654   7,304   Total current assets 566,521 600,708 Equity investments 6,473 6,463 Property, plant and equipment Oil and natural gas properties 7,908,709 7,736,409 Other property, plant and equipment 141,047   60,533   8,049,756 7,796,942 Accumulated depletion and depreciation (3,161,636 ) (1,342,741 ) Net property, plant and equipment 4,888,120 6,454,201 Other long-term assets Intangibles, net 1,538 8,336 Goodwill — 92,024 Derivative instruments 267,681 319,560 Other long-term assets 119,715   157,042   Total assets $ 5,850,048   $ 7,638,334     LIABILITIES AND EQUITY Current liabilities Accounts payable $ 63,921 $ 129,270 Current portion of long-term debt 603 105,000 Derivative instruments 5,289 5,457 Distributions payable 733 733 Current portion of asset retirement obligation 2,390 4,948 Revenue and royalties payable 42,454 40,452 Wages and salaries payable 22,264 22,322 Accrued interest payable 42,989 20,672 Production and property taxes payable 30,838 25,207 Other current liabilities 6,644   7,495   Total current liabilities 218,125 361,556 Credit facility 1,253,000 2,089,500 Senior notes, net 1,788,466 1,156,560 Other long-term debt 2,397   1,100   Total long-term debt 3,043,863 3,247,160 Deferred income taxes 2,269 2,575 Asset retirement obligation 247,317 233,463 Derivative instruments 1,421 2,269 Other long-term liabilities 24,615   25,135   Total liabilities 3,537,610 3,872,158   Equity Series A preferred units, 8.0 million units issued and outstanding at each of September 30, 2015 and December 31, 2014 193,215 193,215 Series B preferred units, 48.0 million and 0 units issued and outstanding at September 30, 2015 and December 31, 2014, respectively 347,454 — Common units, 211.8 million and 210.9 million units issued and outstanding at September 30, 2015 and December 31, 2014, respectively 1,765,689 3,566,468 Accumulated other comprehensive loss (576 ) (392 ) Total partners' equity 2,305,782 3,759,291 Noncontrolling interest 6,656   6,885   Total equity 2,312,438   3,766,176     Total liabilities and equity $ 5,850,048   $ 7,638,334       Breitburn Energy Partners LP and Subsidiaries Unaudited Consolidated Statements of Operations       Three Months Ended     Nine Months Ended September 30, September 30, Thousands of dollars, except per unit amounts 2015     2014 2015     2014   Revenues and other income items Oil, natural gas and natural gas liquid sales $ 153,325 $ 216,146 $ 505,584 $ 658,753 Gain (loss) on commodity derivative instruments, net 253,012 146,171 296,772 (21,057 ) Other revenue, net 5,922   1,585   18,895   4,240   Total revenues and other income items 412,259 363,902 821,251 641,936   Operating costs and expenses Operating costs 115,135 82,904 348,950 248,161 Depletion, depreciation and amortization 117,464 72,671 336,735 204,417 Impairments of oil and natural gas properties 1,440,167 29,434 1,499,280 29,434 Impairments of goodwill — — 95,947 — General and administrative expenses 23,276 18,737 78,400 53,886 Restructuring costs (278 ) — 6,413 — (Gain) loss on sale of assets (7,459 ) (63 ) (7,322 ) 357   Total operating costs and expenses 1,688,305   203,683   2,358,403   536,255     Operating (loss) income (1,276,046 ) 160,219 (1,537,152 ) 105,681   Interest expense, net of capitalized interest 50,919 29,494 151,988 90,360 Loss on interest rate swaps 996 — 3,411 — Other expenses (income), net (137 ) (450 ) (579 ) (1,223 ) Total other expense 51,778   29,044   154,820   89,137     (Loss) income before taxes (1,327,824 ) 131,175 (1,691,972 ) 16,544   Income tax expense 14   532   365   384     Net (loss) income (1,327,838 ) 130,643 (1,692,337 ) 16,160   Less: Net income attributable to noncontrolling interest 91   —   124   —     Net (loss) income attributable to the partnership (1,327,929 ) 130,643   (1,692,461 ) 16,160     Less: Distributions to Series A preferred unitholders 4,125 4,125 12,375 5,958 Less: Non-cash distributions to Series B preferred unitholders 7,145 — 13,553 — Less: Net (loss) income attributable to participating units (31,662 ) 1,868   (40,612 ) 40     Net (loss) income attributable to common unitholders $ (1,307,537 ) $ 124,650   $ (1,677,777 ) $ 10,162     Basic net (loss) income per common unit $ (6.17 ) $ 1.03   $ (7.94 ) $ 0.08   Diluted net (loss) income per common unit $ (6.17 ) $ 1.03   $ (7.94 ) $ 0.08     Weighted average number of units used to calculate basic and diluted net (loss) income per unit (in thousands): Basic 211,766 120,473 211,369 119,806 Diluted 211,766 121,250 211,369 120,544     Breitburn Energy Partners LP and Subsidiaries Unaudited Consolidated Statements of Comprehensive (Loss) Income      

Three Months EndedSeptember 30,

   

Nine Months EndedSeptember 30,

Thousands of dollars, except per unit amounts 2015     2014 2015     2014 Net (loss) income $ (1,327,838 ) $ 130,643 $ (1,692,337 ) $ 16,160   Other comprehensive loss, net of tax: Change in fair value of available-for-sale securities (a) (463 ) —   (537 ) — Total other comprehensive loss (463 ) —   (537 ) —   Total comprehensive (loss) income (1,328,301 ) 130,643 (1,692,874 ) 16,160   Less: Comprehensive loss attributable to noncontrolling interest (303 ) —   (229 ) —   Comprehensive (loss) income attributable to the partnership $ (1,327,998 ) $ 130,643   $ (1,692,645 ) $ 16,160 (a)   Net of income tax benefit of $0.4 million and $0.3 million for the three months and nine months ended September 30, 2015.     Breitburn Energy Partners LP and Subsidiaries Unaudited Consolidated Statements of Cash Flows       Nine Months Ended September 30, Thousands of dollars 2015     2014   Cash flows from operating activities Net (loss) income $ (1,692,337 ) $ 16,160 Adjustments to reconcile to cash flow from operating activities: Depletion, depreciation and amortization 336,735 204,417 Impairment of oil and natural gas properties 1,499,280 29,434 Impairment of goodwill 95,947 — Unit-based compensation expense 20,714 18,440 (Gain) loss on derivative instruments (293,361 ) 21,057 Derivative instrument settlement receipts (payments) 351,518 (34,228 ) Income from equity affiliates, net (10 ) 90 Deferred income taxes (306 ) 153 (Gain) loss on sale of assets (7,322 ) 357 Other 14,348 5,172 Changes in net assets and liabilities

 

Accounts receivable and other assets 22,251 (3,345 ) Inventory 356 (528 ) Net change in related party receivables and payables 393 1,095 Accounts payable and other liabilities 2,978   36,642   Net cash provided by operating activities 351,184   294,916   Cash flows from investing activities Property acquisitions (17,160 ) (6,422 ) Capital expenditures (226,718 ) (293,275 ) Proceeds from sale of assets 9,441 366 Proceeds from sale of available-for-sale securities 3,631 — Purchases of available-for-sale securities (3,803 ) — Other (853 ) (9,242 ) Net cash used in investing activities (235,462 ) (308,573 ) Cash flows from financing activities

Proceeds from issuance of preferred units, net

337,895 193,215

Proceeds from issuance of common units, net

4,768 25,917 Distributions to preferred unitholders (12,375 ) (5,225 ) Distributions to common unitholders (108,283 ) (181,430 ) Proceeds from issuance of long-term debt, net 1,203,400 693,000 Repayments of long-term debt (1,512,500 ) (707,000 ) Change in bank overdraft (39 ) (2,417 ) Debt issuance costs (29,125 ) (1,634 ) Net cash (used in) provided by financing activities (116,259 ) 14,426   (Decrease) increase in cash (537 ) 769 Cash beginning of period 12,628   2,458   Cash end of period $ 12,091   $ 3,227  

Breitburn Energy Partners LPAntonio D'AmicoVice President, Investor Relations & Government AffairsorJessica TangInvestor Relations Manager213-225-0390