|UNITED
STATESSECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549
|----------------------------------------------------------------------

|FORM
10-Q
|---------

|[X]     QUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|-----------------------------------------------------------------------------------------------

|For the quarterly period ended March 31, 2003
|---------------------------------------------

|[   ]      TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|---------------------------------------------------------------------------------------------------

|For
the transition period from ________ to ________.
|----------------------------------------------------

|Commission
file numbers: 1-14323                                                      333-93239-01
|--------------------------------------------------------------------------------------------------

|ENTERPRISE PRODUCTS PARTNERS L.P.
ENTERPRISE PRODUCTS OPERATING L.P.
(Exact name of registrants as specified in their charters)
|-------------------------------------------------------------------------------------------------------------------------------

|Delaware                                                       |  | 76-0568219                          
|-------------------------------------------------------------- |  | ------------------------------------
|Delaware                                                       |  | 76-0568220                          
|(State or other jurisdiction of
incorporation of organization) |  | (I.R.S. Employer Identification No.)

|2727
North Loop West, Houston, Texas 77008-1037 (Address of principal executive
offices) (Zip Code)
|---------------------------------------------------------------------------------------------------

|Registrants
telephone number, including area code:   (713) 880-6500
|--------------------------------------------------------------------

Indicate
by check mark whether the registrants: (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 [X]   No [    ]
|-------------------

Indicate
by check mark whether the registrant is an accelerated filer (as defined in Exchange Act
Rule 12b-2).

|Yes [X]   No [    ]
|-------------------

There
were 167,062,202 Common Units, 21,409,868 Subordinated Units and 10,000,000 Special Units
of Enterprise Products Partners L.P.outstanding at May 1, 2003. Enterprise Products
Partners L.P.'s Common Units trade on the New York Stock Exchange under symbol "EPD."
Enterprise Products Operating L.P. is owned 98.9899% by its parent, EPD, and 1.0101% by
the General Partner. No common equity securities of Enterprise Products Operating L.P.
are publicly traded.



---

# EXPLANATORY NOTE

This
report constitutes a combined quarterly report on Form 10-Q for Enterprise Products
Partners L.P. (the "Company")(Commission File No. 1-14323) and its 98.9899% owned
subsidiary, Enterprise Products Operating L.P. (the "Operating Partnership")(Commission
File No. 333-93239-01).  Since the Operating Partnership owns substantially all of the
Company's consolidated assets and conducts substantially all of the Company's business
and operations, the information set forth herein, except for Part I, Item 1, constitutes
combined information for the Company and the Operating Partnership.  In accordance with
Rule 3-10 of Regulation S-X, Part I, Item 1 contains separate financial statements for
the Company and the Operating Partnership.

The Operating Partnerships Form
10-Q for the first quarter of 2003 was filed originally under CIK #0001061219 on May 13,
2003. Per instructions from EDGAR filing support on August 6, 2003, the Form 10-Q for the
Operating Partnership was retransmitted to the Securities and Exchange Commission EDGAR
system on August 6, 2003 to the co-registrant CIK # 0001102995.



---

ENTERPRISE PRODUCTS PARTNERS L.P.
                                                  ENTERPRISE PRODUCTS OPERATING L.P.
                                                           TABLE OF CONTENTS

|                                          |                                                                                         | Page No.
|----------------------------------------- | --------------------------------------------------------------------------------------- | --------
|
|Glossary                                  |                                                                                         |         
|                                          |                                                                                         |         
|Item 1.                                   | Financial Statements.                                                                   |         
|Item 1A.                                  | Enterprise Products Partners L.P.                                                       | 1       
|Item 1B.                                  | Enterprise Products Operating L.P.                                                      | 21      
|                                          |                                                                                         |         
|Item 2.                                   | Management's Discussion and Analysis of Financial Condition   
and Results of Operation | 40      
|                                          |                                                                                         |         
|Item 3.                                   | Quantitative and Qualitative Disclosures about Market Risk                              | 57      
|                                          |                                                                                         |         
|Item 4.                                   | Controls and Procedures                                                                 | 58      
|                                          |                                                                                         |         
|                                          | PART II                                                                                 |         
|                                          |                                                                                         |         
|Item 6.                                   | Exhibits and Reports on Form 8-K.                                                       | 59      
|                                          |                                                                                         |         
|Signature Page                            |                                                                                         | 62      
|Sarbanes-Oxley Section 302 certifications | 63                                                                                     



---

|Glossary                                                                                
|----------------------------------------------------------------------------------------
|                                                                                        
|The following abbreviations, acronyms or terms used in this Form 10-Q are defined below:
|                                                                                        
|                                                                                        
|Acadian Gas                                                                             
|Accum. OCI                                                                              
|BBtus                                                                                   
|BEF                                                                                     
|Belle Rose                                                                              
|BPD                                                                                     
|BRF                                                                                     
|BRPC                                                                                    
|CEO                                                                                     
|CFO                                                                                     
|CMAI                                                                                    
|Company                                                                                 
|CPG                                                                                     
|Diamond-Koch                                                                            
|Dixie                                                                                   
|EPCO                                                                                    
|EPIK                                                                                    
|EPOLP                                                                                   
|EPU                                                                                     
|Evangeline                                                                              
|FASB                                                                                    
|Feedstock                                                                               
|Forward sales contracts                                                                 
|GAAP                                                                                    
|General Partner                                                                         
|La Porte                                                                                
|LIBOR                                                                                   
|MBA                                                                                     
|MBA acquisition                                                                         
|MBFC                                                                                    
|MBPD                                                                                    
|Mid-America                                                                             
|MMBbls                                                                                  
|MMBtu/d                                                                                 
|MMBtus                                                                                  
|Mont Belvieu                                                                            
|Mont Belvieu Storage II                                                                 
|Mont Belvieu Splitter III                                                               
|Moody's                                                                                 



---

|Glossary (continued)                                                                                                                             
|-------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                 
|                                                                                                                                                 
|MTBE                                                                                                                                             
|Nemo                                                                                                                                             
|Neptune                                                                                                                                          
|NGL or NGLs                                                                                                                                      
|NYSE                                                                                                                                             
|OPIS                                                                                                                                             
|Operating Partnership                                                                                                                            
|OTC                                                                                                                                              
|Promix                                                                                                                                           
|SEC                                                                                                                                              
|Seminole                                                                                                                                         
|SFAS                                                                                                                                             
|Shell                                                                                                                                            
|Splitter III                                                                                                                                     
|S & P                                                                                                                                            
|Starfish                                                                                                                                         
|Throughput                                                                                                                                       
|Toca-Western                                                                                                                                     
|Tri-States                                                                                                                                       
|Venice                                                                                                                                           
|Unit                                                                                                                                             
|VESCO                                                                                                                                            
|Williams                                                                                                                                         
|Wilprise                                                                                                                                         
|                                                                                                                                                 
|For definitions of other commonly used terms used in our industry, please refer to the "Glossary" section of our 2002 annual report on Form 10-K.



---

|PART I. FINANCIAL
STATEMENTS.Item 1A. ENTERPRISE PRODUCTS
PARTNERS L.P.CONSOLIDATED BALANCE
SHEETS(Dollars in thousands)
|------------------------------------------------------------------------------------------------------------------------

|ASSETS                                                                        | March 31,
2003 | December 31,
2002
|----------------------------------------------------------------------------- | -------------- | -----------------
|Current Assets                                                                |                |                  
|Cash and cash equivalents  (includes restricted cash of $18,757 at            |                |                  
|March 31, 2003 and $8,751 at December 31, 2002)                               |                |                  
|Accounts and notes receivable - trade, net of allowance for doubtful accounts |                |                  
|of $21,249 at March 31, 2003 and $21,196 at December 31, 2002                 |                |                  
|Accounts receivable - affiliates                                              |                |                  
|Inventories                                                                   |                |                  
|Prepaid and other current assets                                              |                |                  
|                                                                              |               
|Total current assets                                                          |                |                  
|Property, Plant and Equipment, Net                                            |                |                  
|Investments in and Advances to Unconsolidated Affiliates                      |                |                  
|Intangible assets, net of accumulated amortization of $29,136 at              |                |                  
|March 31, 2003 and $25,546 at December 31, 2002                               |                |                  
|Goodwill                                                                      |                |                  
|Deferred Tax Asset                                                            |                |                  
|Other Assets                                                                  |                |                  
|                                                                              |               
|Total                                                                         |                |                  
|                                                                              |               
|LIABILITIES AND PARTNERS' EQUITY                                              |                |                  
|Current Liabilities                                                           |                |                  
|Current maturities of debt                                                    |                |                  
|Accounts payable-trade                                                        |                |                  
|Accounts payable-affiliates                                                   |                |                  
|Accrued gas payables                                                          |                |                  
|Accrued expenses                                                              |                |                  
|Accrued interest                                                              |                |                  
|Other current liabilities                                                     |                |                  
|                                                                              |               
|Total current liabilities                                                     |                |                  
|Long-Term Debt                                                                |                |                  
|Other Long-Term Liabilities                                                   |                |                  
|Minority Interest                                                             |                |                  
|Commitments and Contingencies                                                 |                |                  
|Partners' Equity                                                              |                |                  
|Common Units  (156,357,266 Units outstanding at March 31, 2003                |                |                  
|and 141,694,766 at December 31, 2002)                                         |                |                  
|Subordinated Units (32,114,804 Units outstanding at March 31, 2003            |                |                  
|and December 31, 2002)                                                        |                |                  
|Special Units (10,000,000 Units outstanding at March 31, 2003                 |                |                  
|and December 31, 2002)                                                        |                |                  
|Treasury Units acquired by Trust, at cost (859,200 Common Units               |                |                  
|outstanding at March 31, 2003 and December 31, 2002)                          |                |                  
|General Partner                                                               |                |                  
|Accumulated Other Comprehensive Income (Loss)                                 |                |                  
|                                                                              |               
|Total Partners' Equity                                                        |                |                  
|                                                                              |               
|Total                                                                         |                |                  
|                                                                              |               

|See Notes to Unaudited Consolidated
Financial Statements
|--------------------------------------------------------

1

---

|ENTERPRISE PRODUCTS
PARTNERS L.P.STATEMENTS OF
CONSOLIDATED OPERATIONSAND COMPREHENSIVE
INCOME (LOSS)(Dollars in thousands,
except per Unit amounts)
|----------------------------------------------------------------------------------------------------------------------------------------------------

|                                                                         | For the Three Months
Ended March 31,
|------------------------------------------------------------------------ | ------------------------------------
|
|REVENUES                                                                 |                                     
|Revenues from consolidated operations                                    |                                     
|Third parties                                                            |                                     
|Related parties                                                          |                                     
|                                                                         |                                     
|Total                                                                    |                                     
|                                                                         |                                     
|COST AND EXPENSES                                                        |                                     
|Operating costs and expenses                                             |                                     
|Third parties                                                            |                                     
|Related parties                                                          |                                     
|Selling, general and administrative                                      |                                     
|Third parties                                                            |                                     
|Related parties                                                          |                                     
|                                                                         |                                     
|Total                                                                    |                                     
|                                                                         |                                     
|EQUITY IN INCOME OF UNCONSOLIDATED AFFILIATES                            |                                     
|                                                                         |                                     
|OPERATING INCOME (LOSS)                                                  |                                     
|                                                                         |                                     
|OTHER INCOME (EXPENSE)                                                   |                                     
|Interest expense                                                         |                                     
|Interest income from related parties                                     |                                     
|Dividend income from unconsolidated affiliates                           |                                     
|Interest income - other                                                  |                                     
|Other, net                                                               |                                     
|                                                                         |                                     
|Other income  (expense)                                                  |                                     
|                                                                         |                                     
|INCOME (LOSS) BEFORE PROVISION FOR INCOME                                |                                     
|TAXES AND MINORITY INTEREST                                              |                                     
|PROVISION FOR INCOME TAXES                                               |                                     
|                                                                         |                                     
|INCOME (LOSS) BEFORE MINORITY INTEREST                                   |                                     
|MINORITY INTEREST                                                        |                                     
|                                                                         |                                     
|NET INCOME (LOSS)                                                        |                                     
|Reclassification of change in value of financial instruments             |                                     
|recorded as cash flow hedges                                             |                                     
|Gain on settlement of financial instruments recorded as cash flow hedges |                                     
|Amortization of gain on settlement of financial instruments to earnings  |                                     
|                                                                         |                                     
|COMPREHENSIVE INCOME (LOSS)                                              |                                     
|                                                                         |                                     
|ALLOCATION OF NET INCOME (LOSS) TO:                                      |                                     
|Limited partners                                                         |                                     
|                                                                         |                                     
|General partner                                                          |                                     
|                                                                         |                                     
|BASIC EARNINGS PER UNIT                                                  |                                     
|Income (loss) before minority interest                                   |                                     
|                                                                         |                                     
|Net income (loss) per Common and Subordinated unit                       |                                     
|                                                                         |                                     
|DILUTED EARNINGS PER UNIT                                                |                                     
|Income (loss) before minority interest                                   |                                     
|                                                                         |                                     
|Net income (loss) per Common, Subordinated                               |                                     
|and Special unit                                                         |                                     
|                                                                         |                                     

|See Notes to Unaudited Consolidated
Financial Statements
|--------------------------------------------------------

2

---

|ENTERPRISE PRODUCTS
PARTNERS L.P.STATEMENTS OF
CONSOLIDATED CASH FLOWS(Dollars in thousands)
|--------------------------------------------------------------------------------------------

|                                                                  | For the Three Months
Ended March 31,
|----------------------------------------------------------------- | ------------------------------------
|
|OPERATING ACTIVITIES                                              |                                     
|Net income (loss)                                                 |                                     
|Adjustments to reconcile net income (loss) to cash flows provided |                                     
|by (used for) operating activities:                               |                                     
|Depreciation and amortization in operating costs and expenses     |                                     
|Depreciation in selling, general and administrative costs         |                                     
|Amortization in interest expense                                  |                                     
|Equity in income of unconsolidated affiliates                     |                                     
|Distributions received from unconsolidated affiliates             |                                     
|Operating lease expense paid by EPCO                              |                                     
|Minority interest                                                 |                                     
|Loss on sale of assets                                            |                                     
|Deferred income tax expense                                       |                                     
|Changes in fair market value of financial instruments             |                                     
|Net effect of changes in operating accounts                       |                                     
|                                                                  |                                     
|Operating activities cash flows                                   |                                     
|                                                                  |                                     
|INVESTING ACTIVITIES                                              |                                     
|Capital expenditures                                              |                                     
|Proceeds from sale of assets                                      |                                     
|Business acquisitions, net of cash received                       |                                     
|Investments in and advances to unconsolidated affiliates          |                                     
|                                                                  |                                     
|Investing activities cash flows                                   |                                     
|                                                                  |                                     
|FINANCING ACTIVITIES                                              |                                     
|Borrowings under debt agreements                                  |                                     
|Repayments of debt                                                |                                     
|Debt issuance costs                                               |                                     
|Distributions paid to partners                                    |                                     
|Distributions paid to minority interests                          |                                     
|Contributions from minority interests                             |                                     
|Proceeds from issuance of Common Units                            |                                     
|Treasury Units purchased                                          |                                     
|Settlement of treasury lock financial instruments                 |                                     
|Increase in restricted cash                                       |                                     
|                                                                  |                                     
|Financing activities cash flows                                   |                                     
|                                                                  |                                     
|NET CHANGE IN CASH AND CASH EQUIVALENTS                           |                                     
|CASH AND CASH EQUIVALENTS, JANUARY 1                              |                                     
|                                                                  |                                     
|CASH AND CASH EQUIVALENTS, MARCH 31                               |                                     
|                                                                  |                                     

|See Notes to Unaudited Consolidated

Financial Statements
|---------------------------------------------------------

3

---

|ENTERPRISE PRODUCTS
PARTNERS L.P.STATEMENTS OF
CONSOLIDATED PARTNERS EQUITY(Dollars in thousands,
see Note 9 for Unit History)
|-------------------------------------------------------------------------------------------------------------------------------

|                                           | Limited Partners | 
|------------------------------------------ | ---------------- | 
|
|Balance, December 31, 2002                 |                  | 
|Net income                                 |                  | 
|Leases paid by EPCO                        |                  | 
|Cash distributions to partners             |                  | 
|Proceeds from issuance of                  |                  | 
|Common Units                               |                  | 
|Reclassification of change in              |                  | 
|value of treasury lock financial           |                  | 
|instruments recorded as                    |                  | 
|cash flow hedges (see Note 11)             |                  | 
|Cash gains on settlement of treasury       |                  | 
|lock financial instruments                 |                  | 
|recorded as cash flow hedges (see Note 11) |                  | 
|Amortization of cash gains on              |                  | 
|settlement of treasury lock                |                  | 
|financial instruments to interest          |                  | 
|expense in earnings (see Note 11)          |                  | 
|                                           |                 
|Balance, March 31, 2003                    |                  | 
|                                           |                 

|See Notes to Unaudited Consolidated

Financial Statements
|---------------------------------------------------------

4

---

# ENTERPRISE PRODUCTS
PARTNERS L.P.NOTES TO UNAUDITED
CONSOLIDATED FINANCIAL STATEMENTS

# 1.      GENERAL

In the
opinion of Enterprise Products Partners L.P., the accompanying unaudited consolidated
financial statements include all adjustments consisting of normal recurring accruals
necessary for a fair presentation of its consolidated financial position as of March 31,
2003 and consolidated results of operations and cash flows for the three months ended
March 31, 2003 and 2002. Within these footnote disclosures of Enterprise Products Partners
L.P., references to we, us, our or the
Company shall mean the consolidated financial statements of Enterprise Products
Partners L.P.

References
to Operating Partnership shall mean the consolidated financial statements of
our primary operating subsidiary, Enterprise Products Operating L.P., which are included
elsewhere in this combined report on Form 10-Q. We own 98.9899% of the Operating
Partnership and act as guarantor of certain debt obligations of the Operating Partnership.
Our General Partner, Enterprise Products GP, LLC, owns the remaining 1.0101% of the
Operating Partnership. Essentially all of our assets, liabilities, revenues and expenses
are recorded at the Operating Partnership level in our consolidated financial statements.

Although
we believe the disclosures in these financial statements are adequate to make the
information presented not misleading, certain information and footnote disclosures
normally included in annual financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted pursuant to the rules and
regulations of the SEC. These unaudited financial statements should be read in conjunction
with our annual report on Form 10-K/A (File No. 1-14323) for the year ended December 31,
2002.

The
results of operations for the three months ended March 31, 2003 are not necessarily
indicative of the results to be expected for the full year.

Dollar
amounts presented in the tabular data within these footnote disclosures are stated in
thousands of dollars, unless otherwise indicated.

Certain
abbreviated entity names and other capitalized terms are described within the glossary of
this quarterly report on Form 10-Q.

Certain
reclassifications have been made to the prior years financial statements to conform
to the current year presentation. These reclassifications had no effect on previously
reported results of consolidated operations.

See
Note 14 for the pro forma effects to net income and earnings per Unit as if we had used
the fair-value based method of accounting for Unit options.

# 2.      RECENTLY ISSUED
ACCOUNTING STANDARDS

The
following recently issued accounting standards have been adopted and implemented by us:

| |      
       SFAS No. 143, "Accounting for Asset Retirement Obligations";
| | --------------------------------------------------------------------------

| |      
       SFAS No. 146, "Accounting for Costs Associated with Exit and Disposal Activities";
| | ------------------------------------------------------------------------------------------------

| |      
       SFAS No. 148, "Accounting for Stock-Based Compensation - Transition and
Disclosure"; and,
| | -------------------------------------------------------------------------------------------------------

| |      
       FIN No. 45, "Guarantor's Accounting and Disclosure Requirement from Guarantees,
Including                Indirect Guarantees of Indebtedness
of Others.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------

We
are currently evaluating the provisions of FIN No. 46, Consolidation of Variable
Interest Entities.

SFAS
No. 143. We adopted this standard as of January 1, 2003. This statement establishes
accounting standards for the recognition and measurement of a liability for an asset

5

---

retirement
obligation (ARO) and the associated asset retirement cost. Under the
provisions of this standard, we reviewed our long-lived assets for ARO liabilities and
identified such liabilities in several operational areas. These include ARO liabilities
related to (i) easements over property not currently owned by us and (ii) statutory
regulatory requirements for abandonment or retirement of certain currently operated
facilities.

As
a result of our analysis of the identified AROs, we were not required to recognize such
potential liabilities. Our rights to the easements are renewable and only require
retirement action upon nonrenewal of the easement agreements. We currently plan to renew
all such easement agreements and use these properties indefinitely. Therefore, the ARO
liability is not estimable for such easements. If we decide to not renew these agreements,
an ARO liability would be recorded at that time. ARO liabilities related to statutory
regulatory requirements for abandonment or retirement of certain currently operated
facilities were also identified. We currently have no intention or legal obligation to
abandon or retire such facilities. An ARO liability would be recorded if future
abandonment or retirement occurred. Certain Gulf of Mexico natural gas pipelines, in which
we have an equity interest, have identified AROs relating to regulatory
requirements. There is no current intention to abandon or retire these pipelines. If these
pipelines were abandoned or retired, an ARO liability would then be disclosed.

SFAS
No. 146. We adopted this standard as of January 1, 2003. This statement requires
companies to recognize costs associated with exit or disposal activities when they are
incurred rather than at the date of a commitment to exit or disposal plan. We determined
that this standard had no material impact on our financial statements.

SFAS
No. 148. We adopted this standard as of December 31, 2002. This statement provides
alternative methods of transition from a voluntary change to the fair value based method
of accounting for stock-based employee compensation. In addition, SFAS No. 148 amends the
disclosure requirements of SFAS No. 123 in both annual and interim financial statements.
We have provided the information required by this statement under Note 14.

SFAS
No. 149. On April 30, 2003, the FASB issued SFAS No. 149, Amendment of Statement 133
on Derivative Instruments and Hedging Activities. This statement amends and
clarifies accounting for derivative instruments, including certain derivative instruments
embedded in other contracts, and for hedging activities under SFAS No. 133. This statement
is effective for contracts entered into or modified after June 20, 2003, for hedging
relationships designated after June 30, 2003, and to certain preexisting contracts. We
will adopt SFAS No. 149 on a prospective basis at its effective date on July 1, 2003. We
are currently evaluating the impact that SFAS No. 149 will have on our financial
statements.

FIN
45. We implemented this FASB interpretation as of December 31, 2002. This
interpretation of SFAS No. 5, 57 and 107, and rescission of FASB Interpretation No. 34
elaborates on the disclosures to be made by a guarantor in its interim and annual
financial statements about its obligations under certain guarantees that it has issued. It
also clarifies that a guarantor is required to recognize, at the inception of a guarantee,
a liability for the fair value of the obligation undertaken in issuing the guarantee. We
have provided the information required by this interpretation under Note 8.

FIN
46. In January 2003, FIN 46, an interpretation of ARB No. 51, Consolidated
Financial Statements, was issued to address perceived weaknesses in accounting for
entities commonly known as special-purpose or off-balance-sheet entities, but the guidance
applies to a larger population of entities. FIN 46 provides guidance for identifying the
party with a controlling financial interest resulting from arrangements or financial
interests rather than from voting interests. FIN 46 defines the term variable
interest entity (or VIE) and is based on the premise that if a business
enterprise has a controlling financial interest in a VIE, the assets, liabilities, and
results of the activities of the VIE should be included in the consolidated financial
statements of the business enterprise. FIN 46 applies immediately to VIEs created after
January 31, 2003 and to VIEs in which an enterprise obtains an interest after that date.
For variable interests in VIEs created before February 1, 2003, FIN 46 applies to public
enterprises no later than the beginning of the first interim or annual period beginning
after June 15, 2003. This FIN may be applied prospectively with the cumulative-effect
adjustment as of the date on which it is first applied or by restating previously issued
financial statements for one

6

---

or
more years with the cumulative-effect adjustment as of the beginning of the first year
restated. We are currently studying the provisions of FIN 46. Based upon our initial
interpretation of FIN 46, we do not believe that this guidance will have a material
effect on our financial statements.

# 3.      BUSINESS ACQUISITIONS

During
the three months ended March 31, 2003, we acquired entities owning the Port Neches
Pipeline and purchased the remaining 50% ownership interest in EPIK. We also made minor
adjustments to the allocation of the purchase price we paid to acquire indirect interests
in the Mid-America and Seminole pipelines. Due to the immaterial nature of each,
individually and in the aggregate, our discussion of each of these transactions is limited
to the following:

Acquisition
of Port Neches Pipeline. In March 2003, we acquired two entities owning the Port
Neches Pipeline (formerly known as the Quest Pipeline) for $14.2 million. The 70-mile Port
Neches Pipeline transports high-purity grade isobutane produced at our facilities in Mont
Belvieu to consumers in Port Neches, Texas.

Acquisition
of remaining 50% interest in EPIK. In March 2003, we purchased the remaining 50%
ownership interests in EPIK for $14.4 million (which is net of cash received of $4.6
million). EPIK owns an NGL export terminal located in southeast Texas. As a result of this
acquisition, EPIK became a wholly-owned subsidiary of ours (previously, it had been an
unconsolidated affiliate).

Our
preliminary allocation of the purchase price of each transaction is as follows:

| | 50% interest
in EPIK                                          | Port Neches
Pipeline | Other | Total
| | ------------------------------------------------------------- | -------------------- | ----- | -----
| | Prepaid and other current assets                              |                      |       | $    
| | Property, plant and equipment                                 |                      |       |      
| | Investments in and advances to      unconsolidated affiliates |                      |       |      
| | Accrued expenses                                              |                      |       |      
| | Other current liabilities                                     |                      |       |      
| | Minority interest                                             |                      |       |      
| |                                                              
| | Total purchase price                                          |                      |       | $    
| |                                                              

# 4.      INVENTORIES

Our inventories
were as follows at the dates indicated:

| | March 31,
2003          | December 31,
2002
| | ----------------------- | -----------------
| | Working inventory       |                  
| | Forward-sales inventory |                  
| |                        
| | Inventory               |                  
| |                        

Our
regular trade (or working) inventory is comprised of inventories of natural
gas, NGLs and petrochemical products that are available for sale by our marketing
activities. The forward sales inventory was comprised of segregated NGL volumes dedicated
to the fulfillment of forward sales contracts.

Due
to fluctuating market conditions in the midstream energy industry in which we operate, we
occasionally recognize lower of average cost or market (LCM) adjustments when
the costs of our inventories exceed their net realizable value. These non-cash adjustments
are charged to operating costs and expenses in the period they are recognized. For three
months ended March 31, 2003 and 2002, we recognized $10.4 million and $0.1 million,
respectively, of such LCM adjustments. The majority of these write-downs were taken
against NGL inventories.

7

---

# 5.      PROPERTY, PLANT AND
EQUIPMENT

Our
property, plant and equipment and accumulated depreciation were as follows at the dates
indicated:

| | Estimated
Useful Life
in Years           | March 31,
2003 | December 31,
2002
| | ---------------------------------------- | -------------- | -----------------
| | Plants and pipelines                     |                | 5-35             
| | Underground and other storage facilities |                | 5-35             
| | Transportation equipment                 |                | 3-35             
| | Land                                     |                |                  
| | Construction in progress                 |                |                  
| |                                         
| | Total                                    |                |                  
| | Less accumulated depreciation            |                |                  
| |                                         
| | Property, plant and equipment, net       |                |                  
| |                                         

Depreciation
for the three-month periods ended March 31, 2003 and 2002 was $27.7 million and $17.2
million, respectively.

# 6.      INVESTMENTS IN AND
ADVANCES TO UNCONSOLIDATED AFFILIATES

We
own interests in a number of related businesses that are accounted for under the equity or
cost methods. The investments in and advances to these unconsolidated affiliates are
grouped according to the operating segment to which they relate. For a general discussion
of our business segments, see Note 12. The following table shows our investments in and
advances to unconsolidated affiliates at the dates indicated:

| | Ownership
Percentage           | March 31,
2003 | December 31,
2002
| | ------------------------------ | -------------- | -----------------
| | Accounted for on equity basis: |                |                  
| | Fractionation:                 |                |                  
| | BRF                            |                |                  
| | BRPC                           |                |                  
| | Promix                         |                |                  
| | La Porte                       |                |                  
| | OTC                            |                |                  
| | Pipeline:                      |                |                  
| | EPIK (see Note 3)              |                |                  
| | Wilprise                       |                |                  
| | Tri-States                     |                |                  
| | Belle Rose                     |                |                  
| | Dixie                          |                |                  
| | Starfish                       |                |                  
| | Neptune                        |                |                  
| | Nemo                           |                |                  
| | Evangeline                     |                |                  
| | Octane Enhancement:            |                |                  
| | BEF                            |                |                  
| | Accounted for on cost basis:   |                |                  
| | Processing:                    |                |                  
| | VESCO                          |                |                  
| |                               
| | Total                          |                |                  
| |                               

8

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The following table shows our
equity in income (loss) of unconsolidated affiliates for the periods indicated:

|                    | Ownership | For the Three Months
Ended March 31,
|------------------- | --------- | ------------------------------------
|
|Fractionation:      |           |                                     
|BRF                 |           | 32.25%                              
|BRPC                |           | 30.00%                              
|Promix              |           | 33.33%                              
|La Porte            |           | 50.00%                              
|OTC                 |           | 50.00%                              
|Pipelines:          |          
|EPIK (see Note 3)   |           | 50.00%                              
|Wilprise            |           | 37.35%                              
|Tri-States          |           | 33.33%                              
|Belle Rose          |           | 41.67%                              
|Dixie               |           | 19.88%                              
|Starfish            |           | 50.00%                              
|Neptune             |           | 25.67%                              
|Nemo                |           | 33.92%                              
|Evangeline          |           | 49.50%                              
|Octane Enhancement: |          
|BEF                 |           | 33.33%                              
|                    |          
|Total               |           |                                     
|                    |          

The
following tables represent summarized income statement information for our unconsolidated
affiliates accounted for under the equity method (for the periods indicated on a 100%
basis). We have grouped this information by the business segment to which the entities
relate.

|                   | Summarized Income Statement Information for the Three Months Ended
|------------------ | ------------------------------------------------------------------
|
|
|Pipelines          |                                                                   
|Fractionation      |                                                                   
|Octane Enhancement |                                                                   

Our
initial investment in Promix, La Porte, Dixie, Neptune and Nemo exceeded our share of the
historical cost of the underlying net assets of such entities (the excess
cost). The excess cost of these investments is reflected in our investments in and
advances to unconsolidated affiliates for these entities. That portion of excess cost
attributable to the tangible plant and/or pipeline assets of each entity is amortized
against equity earnings from these entities in a manner similar to depreciation. That
portion of excess cost attributable to goodwill is subject to periodic impairment testing
and is not amortized.

9

---

The
following table summarizes our excess cost information at March 31, 2003 and December 31,
2002 by the business segment to which the unconsolidated affiliates relate:

|                                                                                      |              | Original Excess Cost
attributable to | Unamortized balance at
|------------------------------------------------------------------------------------- | ------------ | ------------------------------------ | ----------------------
|
|Fractionation                                                                         | 20-35 years  | 8,828                                |                       
|Pipelines                                                                             | 35 years (1) | 41,943                               | 9,246                 
|                                                                                     
|(1) Goodwill is not amortized; however, it is subject to
periodic impairment testing.

For
the three months ended March 31, 2003 and 2002, we recorded $0.4 million and $0.5 million,
respectively, of excess cost amortization which is reflected in our equity in income from
unconsolidated affiliates.

Purchase
of remaining 50% interest in EPIK

As
discussed in Note 3, we purchased the remaining 50% ownership interests in EPIK in March
2003. As a result of this acquisition, EPIK became a wholly-owned subsidiary of ours. We
recorded $1.8 million of equity income from EPIK for the two months that it was an
unconsolidated subsidiary during the first quarter of 2003.

# 7.      INTANGIBLE ASSETS AND
GOODWILL

# Intangible assets

The
following table summarizes our intangible assets at March 31, 2003 and December 31, 2002:

|                                                                                                      |  | At March 31, 2003 | At December 31, 2002
|----------------------------------------------------------------------------------------------------- |  | ----------------- | --------------------
|
|Shell natural gas processing agreement                                                                |  |                   | $                   
|Mont Belvieu Storage II contracts                                                                     |  |                   |                     
|Mont Belvieu Splitter III contracts                                                                   |  |                   |                     
|Toca-Western natural gas processing contracts                                                         |  |                   |                     
|Toca-Western NGL fractionation contracts                                                              |  |                   |                     
|Venice contracts (a)                                                                                  |  |                   |                     
|                                                                                                      | 
|Total                                                                                                 |  |                   | $                   
|                                                                                                     
|                                                                                                      | 
|                                                                                                     
|(a) Amortization scheduled to begin when contracted-volumes
begin to be processed in in the late 2003

The following
table shows amortization expense associated with our intangible assets for the three
months ended March 31, 2003 and 2002:

|                                              | For the Three Months
Ended March 31,
|--------------------------------------------- | ------------------------------------
|
|Shell natural gas processing agreement        | $                                   
|Mont Belvieu Storage II contracts             |                                     
|Mont Belvieu Splitter III contracts           |                                     
|Toca-Western natural gas processing contracts |                                     
|Toca-Western NGL fractionation contracts      |                                     
|                                              |                                     
|Total                                         | $                                   
|                                              |                                     

10

---

# Goodwill

Our
goodwill is attributable to the excess of the purchase price over the fair value of assets
acquired and is comprised of the following (at March 31, 2003 and December 31, 2002):

| | Mont Belvieu Splitter III acquisition |  |  | $ | 73,690 | 
| | ------------------------------------- |  |  | - | ------ | 
| | MBA acquisition                       |  |  |   | 7,857  | 
| |                                      
| |                                       |  |  | $ | 81,547 | 
| |                                      

Our
goodwill amounts are classified as part of the Fractionation segment since they are
related to assets recorded within this operating segment.

# 8.      DEBT OBLIGATIONS

Our
debt obligations consisted of the following at the dates indicated:

|                                                         | March 31,
2003 | December 31,
2002
|-------------------------------------------------------- | -------------- | -----------------
|Borrowings under:                                        |                |                  
|364-Day Term Loan, variable rate, due July 2003          |                |                  
|364-Day Revolving Credit facility, variable rate,        |                |                  
|due November 2004                                        |                |                  
|Multi-Year Revolving Credit facility, variable rate,     |                |                  
|due November 2005                                        |                |                  
|Senior Notes A, 8.25% fixed rate, due March 2005         |                |                  
|Seminole Notes, 6.67% fixed rate, $15 million due        |                |                  
|each December, 2002 through 2005                         |                |                  
|MBFC Loan, 8.70% fixed rate, due March 2010              |                |                  
|Senior Notes B, 7.50% fixed rate, due February 2011      |                |                  
|Senior Notes C, 6.375% fixed rate, due February 2013     |                |                  
|Senior Notes D, 6.875% fixed rate, due March 2033        |                |                  
|                                                         |               
|Total principal amount                                   |                |                  
|Unamortized balance of increase in fair value related to |                |                  
|hedging a portion of fixed-rate debt                     |                |                  
|Less unamortized discount on:                            |                |                  
|Senior Notes A                                           |                |                  
|Senior Notes B                                           |                |                  
|Senior Notes D                                           |                |                  
|Less current maturities of debt                          |                |                  
|                                                         |               
|Long-term debt                                           |                |                  
|                                                         |               

Letters
of credit. At March 31, 2003 and December 31, 2002, we had $75 million of standby
letter of credit capacity under our Multi-Year Revolving Credit facility. We had $25.7
million of letters of credit outstanding under this facility at March 31, 2003 and $2.4
million outstanding at December 31, 2002.

Parent-Subsidiary
guarantor relationships. We act as guarantor of certain debt obligations of our
subsidiaries, including all of our Operating Partnerships consolidated debt
obligations, with the exception of the Seminole Notes. The Seminole Notes are unsecured
obligations of Seminole Pipeline Company (of which we own an effective 78.4% of its
ownership interests). If the Operating Partnership were to default on any guaranteed debt
obligation, we would be responsible for full payment of that obligation.

11

---

New
debt obligations issued during first quarter of 2003

During
the first quarter of 2003, we completed the issuance of $850 million of private placement
debt (Senior Notes C and D). Senior Notes C and D are unsecured obligations of our
Operating Partnership and rank equally with its existing and future unsecured and
unsubordinated indebtedness and senior to any future subordinated indebtedness. We
guarantee both Senior Notes C and D for our subsidiary through an unsecured and
unsubordinated guarantee that is non-recourse to the General Partner. These notes were
issued under an indenture containing certain covenants and are subject to a make-whole
redemption right. These covenants restrict our ability, with certain exceptions, to incur
debt secured by liens and engage in sale and leaseback transactions.

Senior
Notes C. In January 2003, we issued $350 million in principal amount of 6.375%
fixed-rate Senior Notes C due February 1, 2013 (Senior Notes C), from which we
received net proceeds before offering expenses of approximately $347.7 million. These
notes were sold at face value with no discount or premium. We used the proceeds from this
offering to repay a portion of the indebtedness outstanding under the 364-Day Term Loan
that we incurred to finance the Mid-America and Seminole acquisitions. In April 2003, we
initiated an offer to exchange the private placement Senior Notes C for
publicly-registered Senior Notes C.

Senior
Notes D. In February 2003, we issued $500 million in principal amount of 6.875%
fixed-rate Senior Notes due March 1, 2033 (Senior Notes D), from which we
received net proceeds before offering expenses of approximately $489.8 million. These
notes were sold at a discount of 98.842% of their face amount. We used $421.4 million from
this offering to repay the remaining principal balance outstanding under the 364-Day Term
Loan. In addition, we applied $60.0 million of the proceeds to reduce the balance
outstanding under the 364-Day Revolving Credit facility. The remaining proceeds were used
for working capital purposes.

Repayment
of 364-Day Term Loan

Our
Operating Partnership entered into a $1.2 billion senior unsecured 364-day term loan to
initially fund the acquisition of indirect interests in Mid-America and Seminole in July
2002. We used $178.5 million of the $182.5 million in proceeds from our October 2002
equity offering to partially repay this loan. We used $252.8 million of the $258.2 million
in proceeds from the January 2003 equity offering (see Note 9), $347.0 million of the
$347.7 million in proceeds from our issuance of Senior Notes C and $421.4 million in
proceeds from our issuance of Senior Notes D to completely repay the 364-Day Term Loan by
February 2003.

Covenants

We
were in compliance with the various covenants of our debt agreements at March 31, 2003 and
December 31, 2002.

Information
regarding variable interest rates paid

The
following table shows the range of interest rates paid and weighted-average interest rate
paid on our variable-rate debt obligations for the three months ended March 31, 2003:

|                                              | Range of
interest rates
paid | Weighted-
average
interest rate
paid
|--------------------------------------------- | ---------------------------- | ------------------------------------
|364-Day Term Loan (a)                         | 2.59% - 2.88%                | 2.85%                               
|364-Day Revolving Credit facility             | 2.47% - 4.25%                | 2.52%                               
|Multi-Year Revolving Credit facility          | 1.92% - 2.00%                | 1.97%                               
|                                             
|                                             
|                                              |                              |                                     
|(a) This facility was repaid in February 2003

12

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# 9.      CAPITAL STRUCTURE

Our
Common Units, Subordinated Units and convertible Special Units represent limited partner
interests in the Company. We are managed by the General Partner. The rights available to
our partners are described in our Third Amended and Restated Agreement of Limited
Partnership (together with any amendments thereto). Our Common Units trade on the New
York Stock Exchange under the symbol EPD.

We
allocate earnings and related amounts to Common and Subordinated Unitholders and the
General Partner in accordance with our partnership agreement. These classes of our
partnership interests are also entitled to receive cash distributions. For financial
accounting and tax purposes, the Special Units are not allocated any portion of net
income; however, for tax purposes, the Special Units are allocated a certain amount of
depreciation until their conversion into Common Units.

In
January 2003, we completed a public offering of 14,662,500 Common Units (including
1,912,500 Common Units sold pursuant to the underwriters over-allotment option) from
which we received net proceeds before offering expenses of approximately $258.2 million,
including our General Partners $5.2 million in capital contributions. We used $252.8
million of the proceeds from this offering to repay a portion of the indebtedness
outstanding under the 364-Day Term Loan. The remaining balance of proceeds was used for
working capital purposes and offering expenses.

Our
partnership agreement stipulates that the Subordinated Units may undergo an early
conversion to Common Units if certain criteria are satisfied. As a result of meeting the
necessary criteria, 10,704,936 of EPCOs Subordinated Units converted to Common Units
on May 1, 2003. The remaining 21,409,868 Subordinated Units will convert to Common Units
on August 1, 2003 if the remaining criteria are met.

The
following table details the Unit activity within each class of our limited partner
interests during the three months ended March 31, 2003 and the outstanding balance of each
at March 31, 2003:

|                                    | Limited Partners |           
|----------------------------------- | ---------------- | ----------
|
|Balance, December 31, 2002          | 141,694,766      | 32,114,804
|Common Units issued in January 2003 | 14,662,500       |           
|                                    |                 
|Balance, March 31, 2003             | 156,357,266      | 32,114,804
|                                    |                 

13

---

# 10.      SUPPLEMENTAL CASH
FLOWS DISCLOSURE

The
net effect of changes in operating accounts and liabilities is as follows:

|                                            | For the Three Months
Ended March 31,
|------------------------------------------- | ------------------------------------
|
|(Increase) decrease in:                     |                                     
|Accounts and notes receivable               |                                     
|Inventories                                 |                                     
|Prepaid and other current assets            |                                     
|Other assets                                |                                     
|Increase (decrease) in:                     |                                     
|Accounts payable                            |                                     
|Accrued gas payable                         |                                     
|Accrued expenses                            |                                     
|Accrued interest                            |                                     
|Other current liabilities                   |                                     
|Other liabilities                           |                                     
|                                            |                                     
|Net effect of changes in operating accounts |                                     
|                                            |                                     

During
the three months ended March 31, 2003, we completed two small business acquisitions and
made minor adjustments to the purchase price allocation of the Mid-America and Seminole
acquisitions. These acquisitions and adjustments affected various balance sheet accounts
(see Note 3). The 2002 period reflects our acquisition of Diamond-Kochs Mont Belvieu
NGL and petrochemical storage business in January 2002 and their adjacent propylene
fractionation business (Splitter III) in February 2002.

We
record certain financial instruments relating to commodity positions and interest rate
hedging activities at their respective fair values using mark-to-market accounting. For
the three months ended March 31, 2002, we recognized a net $30.1 million in non-cash
mark-to-market decreases in the fair value of these instruments, primarily in our
commodity financial instruments portfolio. We had a limited number of such positions
outstanding during the first quarter of 2003 and the non-cash change in fair value of
these instruments was an increase of $28 thousand.

Cash
and cash equivalents (as shown on our Statements of Consolidated Cash Flows) excludes
restricted cash amounts held by a brokerage firm as margin deposits associated with our
financial instruments portfolio and for our physical purchase transactions made on the
NYMEX exchange. The restricted cash balance at March 31, 2003 and December 31, 2002 was
$18.8 million and $8.8 million, respectively.

# 11.      FINANCIAL INSTRUMENTS

We
are exposed to financial market risks, including changes in commodity prices and interest
rates. We may use financial instruments (i.e., futures, forwards, swaps, options, and
other financial instruments with similar characteristics) to mitigate the risks of certain
identifiable and anticipated transactions, primarily within our Processing segment. In
general, the types of risks we attempt to hedge are those relating to the variability of
future earnings and cash flows caused by changes in commodity prices and interest rates.
As a matter of policy, we do not use financial instruments for speculative (or trading)
purposes.

Commodity
hedging financial instruments

During
the first three months of 2002, we recognized a loss of $45.1 million from our Processing
segments commodity hedging activities that was recorded as an operating cost in our
Statements of Consolidated Operations and Comprehensive Income. In March 2002, the
effectiveness of our primary commodity hedging strategy at the time deteriorated due to an

14

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unexpected
rapid increase in natural gas prices whereby the loss in value of our fixed-price
natural gas financial instruments was not offset by increased gas processing margins. We
exited the strategy underlying this loss in 2002.

During
the first three months of 2003, we held a limited number of commodity financial
instruments from which we recorded a loss of $0.9 million ($0.1 million was attributable
to the Processing segment and the remainder to the Pipelines segment). The fair value of
open positions at March 31, 2003 was a receivable of approximately $2 thousand.

Interest
rate hedging financial instruments

During
the fourth quarter of 2002, we entered into seven treasury lock transactions. Each
treasury lock transaction carried a maturity date of either January 31, 2003 or April 15,
2003. The purpose of these transactions was to hedge the underlying U.S. treasury interest
rate associated with our anticipated issuance of debt in early 2003 to refinance the
Mid-America and Seminole acquisitions. The notional amounts of these transactions totaled
$550 million, with a total treasury lock rate of approximately 4%.

Our
treasury lock transactions are accounted for as cash flow hedges under SFAS No. 133. The
fair value of these instruments at December 31, 2002 was a current liability of $3.8
million offset by a current asset of $0.2 million. The net $3.6 million non-cash
mark-to-market liability was recorded as a component of comprehensive income on that date,
with no impact to current earnings.

We
settled all of the treasury locks by early February 2003 in connection with our issuance
of Senior Notes C and D (see Note 8). The settlement of these instruments resulted in our
receipt of $5.4 million of cash. This amount was recorded as a gain in other comprehensive
income during the first quarter of 2003 and represents the effective portion of the
treasury locks.

Of
the $5.4 million recorded in other comprehensive income during the first quarter of 2003,
$4.0 million is attributable to our issuance of Senior Notes C and is being amortized to
earnings as a reduction in interest expense over the 10-year term of this debt. The
remaining $1.4 million is attributable to our issuance of Senior Notes D and is being
amortized to earnings as a reduction in interest expense over the 10-year term of the
anticipated transaction as required by SFAS No. 133. The estimated amount to be
reclassified from accumulated other comprehensive income to earnings during 2003 is $0.4
million. With the settlement of the treasury locks, the $3.6 million non-cash
mark-to-market liability recorded at December 31, 2002 was reclassified out of accumulated
other comprehensive income in Partners Equity to offset the current asset and
liability we recorded at December 31, 2002 with no impact to earnings.

# 12.      SEGMENT INFORMATION

We
have five reportable operating segments: Pipelines, Fractionation, Processing, Octane
Enhancement and Other. The reportable segments are generally organized according to the
type of services rendered (or process employed) and products produced and/or sold, as
applicable. The segments are regularly evaluated by the Chief Executive Officer of the
General Partner. Pipelines consists of NGL, petrochemical and natural gas pipeline
systems, storage and import/export terminal services. Fractionation primarily includes NGL
fractionation, isomerization, and polymer-grade and chemical-grade propylene fractionation
services. Processing includes the natural gas processing business and its related NGL
marketing activities. Octane Enhancement represents our equity interest in BEF, a facility
that produces motor gasoline additives to enhance octane (currently producing MTBE). The
Other operating segment consists of fee-based marketing services and various operational
support activities.

We
evaluate segment performance based on the non-GAAP financial measure of gross operating
margin. We define gross operating margin as operating income before: (1) depreciation and
amortization amounts; (2) operating lease expenses for which the partnership does not
have the payment obligation; (3) gains and losses on the sale of assets; and (4) selling,
general and administrative expenses. Gross operating margin is exclusive of other income
and expense transactions, provision for income taxes, minority interest and extraordinary
charges. Segment gross operating margin is derived by subtracting segment operating costs
and expenses (before depreciation and amortization amounts, operating lease expenses for

15

---

which
the partnership does not have the payment obligation and gains and losses on the sale
of assets) from segment revenues, with both segment totals before elimination of
intercompany transactions. Intercompany accounts and transactions are eliminated in
consolidation in accordance with GAAP. Segment gross operating margin is also exclusive
of other income and expense transactions, provision for income taxes, minority interest
and extraordinary charges. We have provided a reconciliation of total gross operating
margin (a non-GAAP performance measure) to operating income.

The
following table shows our measurement of total segment gross operating margin for the
periods indicated:

|                                                                                                                                                                                                                                                                                                                                                                                 | For the Three Months
Ended March 31,
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------
|
|Revenues (a)                                                                                                                                                                                                                                                                                                                                                                     |                                     
|Less operating costs and expenses (a)                                                                                                                                                                                                                                                                                                                                            |                                     
|Add equity in income of unconsolidated affiliates (b)                                                                                                                                                                                                                                                                                                                            |                                     
|Subtotal                                                                                                                                                                                                                                                                                                                                                                         |                                     
|Add: Depreciation and amortization in operating costs and expenses (c)                                                                                                                                                                                                                                                                                                           |                                     
|Retained lease expense, net in operating expenses allocable to us (d)                                                                                                                                                                                                                                                                                                            |                                     
|Retained lease expense, net in operating expense allocable to                                                                                                                                                                                                                                                                                                                    |                                     
|our General Partner's minority interest in us(e)                                                                                                                                                                                                                                                                                                                                 |                                     
|Loss on sale of assets in operating costs and expenses (c)                                                                                                                                                                                                                                                                                                                       |                                     
|Total segment gross operating margin                                                                                                                                                                                                                                                                                                                                             |                                     
|                                                                                                                                                                                                                                                                                                                                                                                
|a) These amounts are comprised of
both third party and related party totals as shown on our Statements of Consolidated
Operations and Comprehensive Income.                                                                                                                                                                                                                     
|(b) This amount is taken directly from our Statements of Consolidated
Operations and Comprehensive Income.                                                                                                                                                                                                                                                                      
|(c) This amount is taken directly from the operating activities section of our Statements of Consolidated Cash
Flows.                                                                                                                                                                                                                                                           
|(d) This non-cash amount represents our share of the value of the operating leases contributed by EPCO to the
Operating Partnership for which EPCO has retained the cash payment obligation (the "retained leases"). This
amount is taken from the operating activities section ("Operating lease expense paid by EPCO" line item) of our
Statements of Consolidated Cash Flows.
|(e) This non-cash amount represents the minority interest's share of the value of the retained leases. This
amount is a component of "Contributions from minority interests" as shown in the financing activities section of
our Statements of Consolidated Cash Flows                                                                                                          

The
following table reconciles GAAP operating income as shown in our Statements of
Consolidated Operations and Comprehensive Income to total segment gross operating margin
(a non-GAAP financial measure):

|                                                              | For the Three Months
Ended March 31,
|------------------------------------------------------------- | ------------------------------------
|
|Operating income (loss)                                       |                                     
|Adjustments to reconcile operating income (loss)              |                                     
|to total segment gross operating margin:                      |                                     
|Depreciation and amortization in operating costs and expenses |                                     
|Operating lease expenses for which EPCO has retained the cash |                                     
|payment obligation, net in operating costs and expenses       |                                     
|Loss on sale of assets in operating costs and expenses        |                                     
|Selling, general and administrative costs                     |                                     
|                                                              |                                     
|Total segment gross operating margin                          |                                     
|                                                              |                                     

16

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Information
by operating segment, together with reconciliations to the consolidated totals, is
presented in the following table:

|                                                                      | Operating Segments |         
|--------------------------------------------------------------------- | ------------------ | --------
|
|Revenues from   third parties:                                        |                    |         
|Three months ended March 31, 2003                                     |                    | $204,490
|Three months ended March 31, 2002                                     |                    | 103,799 
|                                                                      |                   
|Revenues from   related parties:                                      |                   
|Three months ended March 31, 2003                                     |                    | 623     
|Three months ended March 31, 2002                                     |                    | 5,623   
|                                                                      |                   
|Intersegment and intrasegment   revenues:                             |                   
|Three months ended March 31, 2003                                     |                    | 84,672  
|Three months ended March 31, 2002                                     |                    | 33,397  
|                                                                      |                   
|Total revenues:                                                       |                   
|Three months ended March 31, 2003                                     |                    | 289,785 
|Three months ended March 31, 2002                                     |                    | 142,819 
|                                                                      |                   
|Equity income in   unconsolidated affiliates:                         |                   
|Three months ended March 31, 2003                                     |                    | 284     
|Three months ended March 31, 2002                                     |                    | 1,639   
|                                                                      |                   
|Gross operating margin by individual   business segment and in total: |                   
|Three months ended March 31, 2003                                     |                    | 29,047  
|Three months ended March 31, 2002                                     |                    | 24,377  
|                                                                      |                   
|Segment assets:                                                       |                   
|At March 31, 2003                                                     |                    | 441,213 
|At December 31, 2002                                                  |                    | 444,016 
|                                                                      |                   
|Investments in and advances   to unconsolidated affiliates:           |                   
|At March 31, 2003                                                     |                    | 97,767  
|At December 31, 2002                                                  |                    | 95,467  
|                                                                      |                   
|Intangible Assets:                                                    |                   
|At March 31, 2003                                                     |                    | 70,439  
|At December 31, 2002                                                  |                    | 71,069  
|                                                                      |                   
|Goodwill:                                                             |                   
|At March 31, 2003 and                                                 |                   
|December 31, 2002                                                     |                    | 81,547  

Our
revenues are derived from a wide customer base. All consolidated revenues during the first
quarter of 2003 and first quarter of 2002 were earned in the United States. Total
consolidated revenues for the three months ended March 31, 2003 increased $819.5 million
over those recorded during the same period in 2002. The majority of this increase is
attributable to higher NGL prices, which (on a weighted-average basis for industry index
prices) were 63 CPG during the first quarter of 2003 compared to 33 CPG during the first
quarter of 2002. The higher NGL prices resulted in a significant increase in Processing
segment revenues (particularly those of its NGL marketing activities component).

Also,
higher natural gas prices during the first quarter of 2003 when compared to the first
quarter of 2002 resulted in a substantial increase in Pipeline segment revenues from our
Acadian Gas subsidiary. As part of its normal operations, Acadian Gas purchases natural
gas from producers and suppliers and resells such natural gas to customers such as
electric utility companies. The average index price for natural gas was $6.58 per MMBtu
during the first quarter of 2003 versus $2.34 per MMBtu during the first quarter of 2002.

17

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In
addition to the effect of higher NGL and natural gas prices, consolidated revenues also
increased as a result of acquisitions. Our Mid-America and Seminole pipeline systems
contributed $82.5 million in revenues during the first three months of 2003.

Total
segment gross operating margin was $126.4 million for the first quarter of 2003 compared
to $26.3 million for the first quarter of 2002. The primary reasons for the increase are
(i) the 2003 period includes $47.5 million of gross operating margin from Mid-America and
Seminole (we acquired these operations in July 2002) and (ii) the 2002 period included
$45.1 million in commodity hedging losses. Mid-America and Seminoles gross operating
margin is classified under our Pipelines segment while commodity hedging results are
primarily a function of our Processing segment activities.

# 13.      PROVISION FOR INCOME
TAXES

Provision
for income taxes is primarily applicable to the tax obligation of a consolidated
subsidiary, Seminole Pipeline Company, which is a corporation and subject to income taxes.
Seminole Pipeline Company became a consolidated subsidiary on August 1, 2002. The
following is a summary of our provision for income taxes for the three months ended March
31, 2003:

|Current:                   |  |  |   |       | 
|-------------------------- |  |  | - | ----- | 
|Federal tax benefit        |  |  | $ | 349   | 
|State tax benefit          |  |  |   | 47    | 
|                           | 
|                           |  |  |   | 396   | 
|                           | 
|Deferred:                  |  | 
|Federal                    |  |  |   | 2,409 | 
|State                      |  |  |   | 324   | 
|                           | 
|                           |  |  |   | 2,733 | 
|                           | 
|Provision for income taxes |  |  | $ | 3,129 | 
|                           | 

The
following is a reconciliation of our provision for income taxes at the federal statutory
rate to our recorded provision for income taxes:

| | Taxes computed by applying the federal statutory rate |  |  | $ | 2,888 | 
| | ----------------------------------------------------- |  |  | - | ----- | 
| | State income taxes (net of federal benefit)           |  |  |   | 241   | 
| |                                                      
| | Provision for income taxes                            |  |  | $ | 3,129 | 
| |                                                      

Significant
components of deferred income tax assets and liabilities at March 31, 2003 are as follows:

|                              | 
|----------------------------- | 
|Deferred tax assets:          | 
|Property, plant and equipment | 
|Deferred tax liabilities:     | 
|Other                         | 
|                              | 
|Net deferred tax assets       | 
|                              | 

Based
upon the periods in which taxable temporary differences are anticipated to reverse, we
believe it is more likely than not that the Company will realize the benefits of these
deductible differences. Accordingly, we believe that no valuation allowance is required
for the deferred tax assets. However, the amount of the deferred tax asset considered
realizable could be adjusted in the future if estimates of reversing taxable temporary
differences are revised.

18

---

# 14.      UNIT OPTION PLAN
ACCOUNTING

During
1998, EPCO adopted its 1998 Long-Term Incentive Plan (the 1998 Plan). Under
the 1998 Plan, non-qualified incentive options to purchase a fixed number of our Common
Units (the Units) may be granted to EPCOs key employees who perform
management, administrative or operational functions for us. The exercise price per Unit,
vesting and expiration terms, and rights to receive distributions on Units granted are
determined by EPCO for each grant. EPCO funds the purchase of the Units under the 1998
Plan at fair value in the open market. In general, our responsibility for reimbursing EPCO
for the expense it incurs when these options are exercised is as follows:

| |  | We
pay EPCO for the costs attributable to equity-based awards granted to operations
personnel it employs on our behalf.
| | - | -----------------------------------------------------------------------------------------------------------------------

| |  | We
pay EPCO for the costs attributable to equity-based awards granted to administrative and
management personnel it hires in response to our expansion and business activities.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | We
pay EPCO for our share of the costs attributable to equity-based awards granted to
certain of its employees in administrative and management positions that were active at
the time of our initial public offering in July 1998 who manage our business and affairs.
These costs are reimbursed through the administrative service fees we pay EPCO. EPCO is
responsible for the actual costs of such awards when these options are exercised.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

We
account for our share of the cost of these awards using the intrinsic value-based method
in accordance with APB No. 25, Accounting for Stock Issued to Employees. The
exercise price of each option granted is equivalent to the market price of the Unit at the
date of grant. Accordingly, no compensation expense related to Unit option grants is
recognized in the Statements of Consolidated Operations and Comprehensive Income until the
grants are exercised by the employee.

Accounting
principles require us to illustrate the pro forma effect on our net income (loss) and
earnings per Unit as if the fair value-based method of accounting, based on SFAS No. 123,
Accounting for Stock Based Compensation, had been applied to the 1998 Plan.
The following table shows these pro forma effects for the periods indicated:

|                                          | For the Three Months
Ended March 31,
|----------------------------------------- | ------------------------------------
|
|Net income (loss):                        |                                     
|As reported                               |                                     
|Additional Unit option-based compensation |                                     
|expense estimated using the               |                                     
|fair value-based method                   |                                     
|                                          |                                     
|Pro forma                                 |                                     
|                                          |                                     
|Basic earnings per Unit:                  |                                     
|As reported                               |                                     
|Pro forma                                 |                                     
|Diluted earnings per Unit:                |                                     
|As reported                               |                                     
|Pro forma                                 |                                     

# 15. EARNINGS PER UNIT

Basic
earnings per Unit is computed by dividing net income available to limited partner
interests by the weighted-average number of Common and Subordinated Units outstanding
during the period. In general, diluted earnings per Unit is computed by dividing net
income available to limited partner interests by the weighted-average number of Common,

19

---

Subordinated
and Special Units outstanding during the period. In a period of net operating losses, the
Special Units are excluded from the calculation of diluted earnings per Unit due to their
antidilutive effect (as occurred for the first quarter of 2002). Treasury Units are not
considered to be outstanding Units; therefore, they are excluded from the computation of
both basic and diluted earnings per Unit. The amount of Common Units outstanding in the
following table does not include Treasury Units.

The
following table reconciles the number of Units used in the calculation of basic earnings
per Unit and diluted earnings per Unit for the three months ended March 31, 2003 and 2002:

|                                                | For the Three Months
Ended March 31,
|----------------------------------------------- | ------------------------------------
|
|Income (loss) before minority interest          |                                     
|General partner interest                        |                                     
|                                                |                                     
|Income (loss) before minority interest          |                                     
|available to Limited Partners                   |                                     
|Minority interest                               |                                     
|                                                |                                     
|Net income (loss) available to Limited Partners |                                     
|                                                |                                     
|BASIC EARNINGS PER UNIT                         |                                     
|Numerator                                       |                                     
|Income(loss) before minority interest           |                                     
|available to Limited Partners                   |                                     
|                                                |                                     
|Net income(loss)available                       |                                     
|to Limited Partners                             |                                     
|                                                |                                     
|Denominator                                     |                                     
|Common Units outstanding                        |                                     
|Subordinated Units outstanding                  |                                     
|                                                |                                     
|Total                                           |                                     
|                                                |                                     
|Basic Earnings per Unit                         |                                     
|Income(loss) before minority interest           |                                     
|available to Limited Partners                   |                                     
|                                                |                                     
|Net income(loss)available                       |                                     
|to Limited Partners                             |                                     
|                                                |                                     
|DILUTED EARNINGS PER UNIT                       |                                     
|Numerator                                       |                                     
|Income(loss) before minority interest           |                                     
|available to Limited Partners                   |                                     
|                                                |                                     
|Net income(loss)available                       |                                     
|to Limited Partners                             |                                     
|                                                |                                     
|Denominator                                     |                                     
|Common Units outstanding                        |                                     
|Subordinated Units outstanding                  |                                     
|Special Units outstanding                       |                                     
|                                                |                                     
|Total                                           |                                     
|                                                |                                     
|Diluted Earnings per Unit                       |                                     
|Income(loss) before minority interest           |                                     
|available to Limited Partners                   |                                     
|                                                |                                     
|Net income(loss)available                       |                                     
|to Limited Partners                             |                                     
|                                                |                                     

20

---

# 

|PART I. FINANCIAL
STATEMENTS.Item 1B. ENTERPRISE
PRODUCTS OPERATING L.P.CONSOLIDATED BALANCE
SHEETS(Dollars in thousands) | 
|------------------------------------------------------------------------------------------------------------------------- | 

|ASSETS                                                                                                                                                       | March 31,
2003 | December 31,
2002
|------------------------------------------------------------------------------------------------------------------------------------------------------------ | -------------- | -----------------
|Current Assets                                                                                                                                               |                |                  
|Cash and cash equivalents  (includes restricted cash of $18,757 at                                                                                           |                |                  
|March 31, 2003 and $8,751 at December 31, 2002)                                                                                                              |                |                  
|Accounts and notes receivable - trade, net of allowance for doubtful
        accounts  of $21,249 at March 31, 2003 and $21,196         at December 31, 2002 |                |                  
|Accounts receivable-affiliates                                                                                                                               |                |                  
|Inventories                                                                                                                                                  |                |                  
|Prepaid and other current assets                                                                                                                             |                |                  
|                                                                                                                                                             |               
|Total current assets                                                                                                                                         |                |                  
|Property, Plant and Equipment, Net                                                                                                                           |                |                  
|Investments in and Advances to Unconsolidated Affiliates                                                                                                     |                |                  
|Intangible assets, net of accumulated amortization of $29,136 at                                                                                             |                |                  
|March 31, 2003 and $25,546 at December 31, 2002                                                                                                              |                |                  
|Goodwill                                                                                                                                                     |                |                  
|Deferred Tax Asset                                                                                                                                           |                |                  
|Other Assets                                                                                                                                                 |                |                  
|                                                                                                                                                             |               
|Total                                                                                                                                                        |                |                  
|                                                                                                                                                             |               
|LIABILITIES AND PARTNERS' EQUITY                                                                                                                             |                |                  
|Current Liabilities                                                                                                                                          |                |                  
|Current maturities of debt                                                                                                                                   |                |                  
|Accounts payable - trade                                                                                                                                     |                |                  
|Accounts payable - affiliates                                                                                                                                |                |                  
|Accrued gas payables                                                                                                                                         |                |                  
|Accrued expenses                                                                                                                                             |                |                  
|Accrued interest                                                                                                                                             |                |                  
|Other current liabilities                                                                                                                                    |                |                  
|                                                                                                                                                             |               
|Total current liabilities                                                                                                                                    |                |                  
|Long-Term Debt                                                                                                                                               |                |                  
|Other Long-Term Liabilities                                                                                                                                  |                |                  
|Minority Interest                                                                                                                                            |                |                  
|Commitments and Contingencies                                                                                                                                |                |                  
|Partners' Equity                                                                                                                                             |                |                  
|Limited Partner                                                                                                                                              |                |                  
|General Partner                                                                                                                                              |                |                  
|Parent's Units acquired by Trust                                                                                                                             |                |                  
|Accumulated Other Comprehensive Income (Loss)                                                                                                                |                |                  
|                                                                                                                                                             |               
|Total Partners' Equity                                                                                                                                       |                |                  
|                                                                                                                                                             |               
|Total                                                                                                                                                        |                |                  
|                                                                                                                                                             |               

|See Notes to Unaudited Consolidated
Financial Statements
|--------------------------------------------------------

21

---

|ENTERPRISE PRODUCTS OPERATING L.P.STATEMENTS OF
CONSOLIDATED OPERATIONSAND COMPREHENSIVE INCOME(Dollars in thousands) | 
|--------------------------------------------------------------------------------------------------------------------- | 

|                                                                         | For the Three Months
Ended March 31,
|------------------------------------------------------------------------ | ------------------------------------
|
|REVENUES                                                                 |                                     
|Revenues from consolidated operations                                    |                                     
|Third parties                                                            |                                     
|Related parties                                                          |                                     
|                                                                         |                                     
|Total                                                                    |                                     
|                                                                         |                                     
|COST AND EXPENSES                                                        |                                     
|Operating costs and expenses                                             |                                     
|Third parties                                                            |                                     
|Related parties                                                          |                                     
|Selling, general and administrative                                      |                                     
|Third parties                                                            |                                     
|Related parties                                                          |                                     
|                                                                         |                                     
|Total                                                                    |                                     
|                                                                         |                                     
|EQUITY IN INCOME OF UNCONSOLIDATED AFFILIATES                            |                                     
|                                                                         |                                     
|OPERATING INCOME (LOSS)                                                  |                                     
|                                                                         |                                     
|OTHER INCOME (EXPENSE)                                                   |                                     
|Interest expense                                                         |                                     
|Interest income from related parties                                     |                                     
|Dividend income from unconsolidated affiliates                           |                                     
|Interest income - other                                                  |                                     
|Other, net                                                               |                                     
|                                                                         |                                     
|Other income  (expense)                                                  |                                     
|                                                                         |                                     
|INCOME (LOSS) BEFORE PROVISION FOR INCOME                                |                                     
|TAXES AND MINORITY INTEREST                                              |                                     
|PROVISION FOR INCOME TAXES                                               |                                     
|                                                                         |                                     
|INCOME (LOSS) BEFORE MINORITY INTEREST                                   |                                     
|MINORITY INTEREST                                                        |                                     
|                                                                         |                                     
|NET INCOME (LOSS)                                                        |                                     
|Reclassification of change in value of financial instruments             |                                     
|recorded as cash flow hedges                                             |                                     
|Gain on settlement of financial instruments recorded as cash flow hedges |                                     
|Amortization of gain on settlement of financial instruments to earnings  |                                     
|                                                                         |                                     
|COMPREHENSIVE INCOME (LOSS)                                              |                                     
|                                                                         |                                     

|See Notes to Unaudited Consolidated
Financial Statements
|--------------------------------------------------------

22

---

|ENTERPRISE PRODUCTS OPERATING L.P.STATEMENTS OF
CONSOLIDATED CASH FLOWS(Dollars in thousands) | 
|--------------------------------------------------------------------------------------------- | 

|                                                                  | For the Three Months
Ended March 31,
|----------------------------------------------------------------- | ------------------------------------
|
|OPERATING ACTIVITIES                                              |                                     
|Net income (loss)                                                 |                                     
|Adjustments to reconcile net income (loss) to cash flows provided |                                     
|by (used for) operating activities:                               |                                     
|Depreciation and amortization in operating costs and expenses     |                                     
|Depreciation in selling, general and administrative costs         |                                     
|Amortization in interest expense                                  |                                     
|Equity in income of unconsolidated affiliates                     |                                     
|Distributions received from unconsolidated affiliates             |                                     
|Operating lease expense paid by EPCO                              |                                     
|Minority interest                                                 |                                     
|Loss on sale of assets                                            |                                     
|Deferred income tax expense                                       |                                     
|Changes in fair market value of financial instruments             |                                     
|Net effect of changes in operating accounts                       |                                     
|                                                                  |                                     
|Operating activities cash flows                                   |                                     
|                                                                  |                                     
|INVESTING ACTIVITIES                                              |                                     
|Capital expenditures                                              |                                     
|Proceeds from sale of assets                                      |                                     
|Business acquisitions, net of cash received                       |                                     
|Investments in and advances to unconsolidated affiliates          |                                     
|                                                                  |                                     
|Investing activities cash flows                                   |                                     
|                                                                  |                                     
|FINANCING ACTIVITIES                                              |                                     
|Borrowings under debt agreements                                  |                                     
|Repayments of debt                                                |                                     
|Debt issuance costs                                               |                                     
|Distributions paid to partners                                    |                                     
|Distributions paid to minority interests                          |                                     
|Contributions from partners                                       |                                     
|Contributions from minority interests                             |                                     
|Parent's Units acquired by consolidated Trust                     |                                     
|Settlement of treasury lock financial instruments                 |                                     
|Increase in restricted cash                                       |                                     
|                                                                  |                                     
|Financing activities cash flows                                   |                                     
|                                                                  |                                     
|NET CHANGE IN CASH AND CASH EQUIVALENTS                           |                                     
|CASH AND CASH EQUIVALENTS, JANUARY 1                              |                                     
|                                                                  |                                     
|CASH AND CASH EQUIVALENTS, MARCH 31                               |                                     
|                                                                  |                                     

|See Notes to Unaudited Consolidated
Financial Statements
|--------------------------------------------------------

23

---

|ENTERPRISE PRODUCTS OPERATING L.P.STATEMENTS OF
CONSOLIDATED PARTNERS' EQUITY(Dollars in thousands) | 
|--------------------------------------------------------------------------------------------------- | 

|                                           | Limited
Partner | General
Partner | Parent's
Units | Accum.
OCI | Total
|------------------------------------------ | --------------- | --------------- | -------------- | ---------- | -----
|Balances, December 31, 2002                |                 |                 | $              | 1,211,593  |      
|Net income                                 |                 |                 |                | 40,932     |      
|Leases paid by EPCO                        |                 |                 |                | 2,251      |      
|Contributions from partners                |                 |                 |                | 255,562    |      
|Cash distributions to partners             |                 |                 |                | (69,743    | )    
|Reclassification of change in              |                 |                
|value of treasury lock financial           |                 |                
|instruments recorded as                    |                 |                
|cash flow hedges (see Note 11)             |                 |                 |                |            |      
|Cash gains on settlement of treasury       |                 |                
|lock financial instruments                 |                 |                
|recorded as cash flow hedges (see Note 11) |                 |                 |                |            |      
|Amortization of cash gains on              |                 |                
|settlement of treasury lock                |                 |                
|financial instruments to interest          |                 |                
|expense in earnings (see Note 11)          |                 |                 |                |            |      
|                                           |                
|Balances, March 31, 2003                   |                 |                 | $              | 1,440,595  |      
|                                           |                

|See Notes to Unaudited Consolidated
Financial Statements
|--------------------------------------------------------

24

---

# ENTERPRISE PRODUCTS
OPERATING L.P.NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

# 1.     GENERAL

In the
opinion of Enterprise Products Operating L.P., the accompanying unaudited consolidated
financial statements include all adjustments consisting of normal recurring accruals
necessary for a fair presentation of its consolidated financial position as of March 31,
2003 and consolidated results of operations and cash flows for the three months ended
March 31, 2003 and 2002. Within these footnote disclosures of Enterprise Products
Operating L.P., references to we, us, our or the
Company shall mean the consolidated financial statements of Enterprise Products
Operating L.P. References to Limited Partner shall mean the consolidated
financial statements of our parent, Enterprise Products Partners L.P., which are included
elsewhere in this combined report on Form 10-Q.

Although
we believe the disclosures in these financial statements are adequate to make the
information presented not misleading, certain information and footnote disclosures
normally included in annual financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted pursuant to the rules and
regulations of the SEC. These unaudited financial statements should be read in conjunction
with our annual report on Form 10-K/A (File No. 333-93239-01) for the year ended December
31, 2002.

The
results of operations for the three months ended March 31, 2003 are not necessarily
indicative of the results to be expected for the full year.

Dollar
amounts presented in the tabular data within these footnote disclosures are stated in
thousands of dollars, unless otherwise indicated.

Certain
abbreviated entity names and other capitalized terms are described within the glossary of
this quarterly report on Form 10-Q.

Certain
reclassifications have been made to the prior years financial statements to conform
to the current year presentation. These reclassifications had no effect on previously
reported results of consolidated operations.

See
Note 14 for the pro forma effects to net income and earnings per Unit as if we had used
the fair-value based method of accounting for Unit options.

# 2.     RECENTLY ISSUED
ACCOUNTING STANDARDS

The
following recently issued accounting standards have been adopted and implemented by us:

| |  | SFAS
No. 143, "Accounting for Asset Retirement Obligations";
| | - | ------------------------------------------------------------

| |  | SFAS
No. 146, "Accounting for Costs Associated with Exit and Disposal Activities";
| | - | ----------------------------------------------------------------------------------

| |  | SFAS
No. 148, "Accounting for Stock-Based Compensation - Transition and Disclosure";
and,
| | - | -----------------------------------------------------------------------------------------

| |  | FIN
No. 45, "Guarantor's Accounting and Disclosure Requirement from Guarantees, Including
Indirect Guarantees of Indebtedness of Others.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------

We
are currently evaluating the provisions of FIN No. 46, Consolidation of Variable
Interest Entities.

SFAS
No. 143. We adopted this standard as of January 1, 2003. This statement establishes
accounting standards for the recognition and measurement of a liability for an asset
retirement obligation (ARO) and the associated asset retirement cost. Under
the provisions of this standard, we reviewed our long-lived assets for ARO liabilities and
identified such liabilities in several operational areas. These include ARO liabilities
related to (i) easements over property not currently owned by us and (ii) statutory
regulatory requirements for abandonment or retirement of certain currently operated
facilities.

25

---

As
a result of our analysis of the identified AROs, we were not required to recognize such
potential liabilities. Our rights to the easements are renewable and only require
retirement action upon nonrenewal of the easement agreements. We currently plan to renew
all such easement agreements and use these properties indefinitely. Therefore, the ARO
liability is not estimable for such easements. If we decide to not renew these agreements,
an ARO liability would be recorded at that time. ARO liabilities related to statutory
regulatory requirements for abandonment or retirement of certain currently operated
facilities were also identified. We currently have no intention or legal obligation to
abandon or retire such facilities. An ARO liability would be recorded if future
abandonment or retirement occurred. Certain Gulf of Mexico natural gas pipelines, in which
we have an equity interest, have identified AROs relating to regulatory
requirements. There is no current intention to abandon or retire these pipelines. If these
pipelines were abandoned or retired, an ARO liability would then be disclosed.

SFAS
No. 146. We adopted this standard as of January 1, 2003. This statement requires
companies to recognize costs associated with exit or disposal activities when they are
incurred rather than at the date of a commitment to exit or disposal plan. We determined
that this standard had no material impact on our financial statements.

SFAS
No. 148. We adopted this standard as of December 31, 2002. This statement provides
alternative methods of transition from a voluntary change to the fair value based method
of accounting for stock-based employee compensation. In addition, SFAS No. 148 amends the
disclosure requirements of SFAS No. 123 in both annual and interim financial statements.
We have provided the information required by this statement under Note 14.

SFAS
No. 149. On April 30, 2003, the FASB issued SFAS No. 149, Amendment of Statement 133
on Derivative Instruments and Hedging Activities. This statement amends and
clarifies accounting for derivative instruments, including certain derivative instruments
embedded in other contracts, and for hedging activities under SFAS No. 133. This statement
is effective for contracts entered into or modified after June 20, 2003, for hedging
relationships designated after June 30, 2003, and to certain preexisting contracts. We
will adopt SFAS No. 149 on a prospective basis at its effective date on July 1, 2003. We
are currently evaluating the impact that SFAS No. 149 will have on our financial
statements.

FIN
45. We implemented this FASB interpretation as of December 31, 2002. This
interpretation of SFAS No. 5, 57 and 107, and rescission of FASB Interpretation No. 34
elaborates on the disclosures to be made by a guarantor in its interim and annual
financial statements about its obligations under certain guarantees that it has issued. It
also clarifies that a guarantor is required to recognize, at the inception of a guarantee,
a liability for the fair value of the obligation undertaken in issuing the guarantee. We
have provided the information required by this interpretation under Note 8.

FIN
46. In January 2003, FIN 46, an interpretation of ARB No. 51, Consolidated
Financial Statements, was issued to address perceived weaknesses in accounting for
entities commonly known as special-purpose or off-balance-sheet entities, but the guidance
applies to a larger population of entities. FIN 46 provides guidance for identifying the
party with a controlling financial interest resulting from arrangements or financial
interests rather than from voting interests. FIN 46 defines the term variable
interest entity (or VIE) and is based on the premise that if a business
enterprise has a controlling financial interest in a VIE, the assets, liabilities, and
results of the activities of the VIE should be included in the consolidated financial
statements of the business enterprise. FIN 46 applies immediately to VIEs created after
January 31, 2003 and to VIEs in which an enterprise obtains an interest after that date.
For variable interests in VIEs created before February 1, 2003, FIN 46 applies to public
enterprises no later than the beginning of the first interim or annual period beginning
after June 15, 2003. This FIN may be applied prospectively with the cumulative-effect
adjustment as of the date on which it is first applied or by restating previously issued
financial statements for one or more years with the cumulative-effect adjustment as of the
beginning of the first year restated. We are currently studying the provisions of FIN 46.
Based upon our initial interpretation of FIN 46, we do not believe that this guidance will
have a material effect on our financial statements.

26

---

# 3.     BUSINESS ACQUISITIONS

During
the three months ended March 31, 2003, we acquired entities owning the Port Neches
Pipeline and purchased the remaining 50% ownership interest in EPIK. We also made minor
adjustments to the allocation of the purchase price we paid to acquire indirect interests
in the Mid-America and Seminole pipelines. Due to the immaterial nature of each,
individually and in the aggregate, our discussion of each of these transactions is limited
to the following:

Acquisition
of Port Neches Pipeline. In March 2003, we acquired two entities owning the Port
Neches Pipeline (formerly known as the Quest Pipeline) for $14.2 million. The 70-mile Port
Neches Pipeline transports high-purity grade isobutane produced at our facilities in Mont
Belvieu to consumers in Port Neches, Texas.

Acquisition
of remaining 50% interest in EPIK. In March 2003, we purchased the remaining 50%
ownership interests in EPIK for $14.4 million (which is net of cash received of $4.6
million). EPIK owns an NGL export terminal located in southeast Texas. As a result of this
acquisition, EPIK became a wholly-owned subsidiary of ours (previously, it had been an
unconsolidated affiliate).

Our
preliminary allocation of the purchase price of each transaction is as follows:

|                                 | 50% interest
in EPIK | Port Neches
Pipeline | Other | Total  
|-------------------------------- | -------------------- | -------------------- | ----- | -------
|Prepaid and other current assets |                      |                      | $     | 1,188  
|Property, plant and equipment    |                      |                      |       | 31,585 
|Investments in and advances to   |                      |                     
|unconsolidated affiliates        |                      |                      |       | (17,247
|Accrued expenses                 |                      |                      |       | (1,102 
|Other current liabilities        |                      |                      |       | (35    
|Minority interest                |                      |                      |       |        
|                                 |                     
|Total purchase price             |                      |                      | $     | 14,389 
|                                 |                     

# 4.     INVENTORIES

Our inventories
were as follows at the dates indicated:

|                        | March 31,
2003 | December 31,
2002
|----------------------- | -------------- | -----------------
|Working inventory       |                |                  
|Forward-sales inventory |                |                  
|                        |               
|Inventory               |                |                  
|                        |               

Our
regular trade (or working) inventory is comprised of inventories of natural
gas, NGLs and petrochemical products that are available for sale by our marketing
activities. The forward sales inventory was comprised of segregated NGL volumes dedicated
to the fulfillment of forward sales contracts.

Due
to fluctuating market conditions in the midstream energy industry in which we operate, we
occasionally recognize lower of average cost or market (LCM) adjustments when
the costs of our inventories exceed their net realizable value. These non-cash adjustments
are charged to operating costs and expenses in the period they are recognized. For the
three months ended March 31, 2003 and 2002, we recognized $10.4 million and $0.1 million,
respectively, of such LCM adjustments. The majority of these write-downs were taken
against NGL inventories.

27

---

# 5.     PROPERTY, PLANT AND
EQUIPMENT

Our
property, plant and equipment and accumulated depreciation were as follows at the dates
indicated:

|                                         | Estimated
Useful Life
in Years | March 31,
2003 | December 31,
2002
|---------------------------------------- | ------------------------------ | -------------- | -----------------
|Plants and pipelines                     |                                |                |                  
|Underground and other storage facilities |                                |                |                  
|Transportation equipment                 |                                |                |                  
|Land                                     |                                |                |                  
|Construction in progress                 |                                |                |                  
|                                         |                               
|Total                                    |                                |                |                  
|Less accumulated depreciation            |                                |                |                  
|                                         |                               
|Property, plant and equipment, net       |                                |                |                  
|                                         |                               

Depreciation
for the three-month periods ended March 31, 2003 and 2002 was $27.7 million and $17.2
million, respectively.

# 6.     INVESTMENTS IN AND
ADVANCES TO UNCONSOLIDATED AFFILIATES

We
own interests in a number of related businesses that are accounted for under the equity or
cost methods. The investments in and advances to these unconsolidated affiliates are
grouped according to the operating segment to which they relate. For a general discussion
of our business segments, see Note 12. The following table shows our investments in and
advances to unconsolidated affiliates at the dates indicated:

|                               | Ownership
Percentage | March 31,
2003 | December 31,
2002
|------------------------------ | -------------------- | -------------- | -----------------
|Accounted for on equity basis: |                      |                |                  
|Fractionation:                 |                      |               
|BRF                            |                      |                |                  
|BRPC                           |                      |                |                  
|Promix                         |                      |                |                  
|La Porte                       |                      |                |                  
|OTC                            |                      |                |                  
|Pipeline:                      |                      |               
|EPIK (see Note 3)              |                      |                |                  
|Wilprise                       |                      |                |                  
|Tri-States                     |                      |                |                  
|Belle Rose                     |                      |                |                  
|Dixie                          |                      |                |                  
|Starfish                       |                      |                |                  
|Neptune                        |                      |                |                  
|Nemo                           |                      |                |                  
|Evangeline                     |                      |                |                  
|Octane Enhancement:            |                      |               
|BEF                            |                      |                |                  
|Accounted for on cost basis:   |                      |               
|Processing:                    |                      |               
|VESCO                          |                      |                |                  
|                               |                     
|Total                          |                      |                |                  
|                               |                     

28

---

The
following table shows our equity in income (loss) of unconsolidated affiliates for the
periods indicated:

|                    | Ownership | For the Three Months
Ended March 31,
|------------------- | --------- | ------------------------------------
|
|Fractionation:      |           |                                     
|BRF                 |           |                                     
|BRPC                |           |                                     
|Promix              |           |                                     
|La Porte            |           |                                     
|OTC                 |           |                                     
|Pipelines:          |           |                                     
|EPIK (see Note 3)   |           |                                     
|Wilprise            |           |                                     
|Tri-States          |           |                                     
|Belle Rose          |           |                                     
|Dixie               |           |                                     
|Starfish            |           |                                     
|Neptune             |           |                                     
|Nemo                |           |                                     
|Evangeline          |           |                                     
|Octane Enhancement: |           |                                     
|BEF                 |           |                                     
|                    |          
|Total               |           |                                     
|                    |          

The
following tables represent summarized income statement information for our unconsolidated
affiliates accounted for under the equity method (for the periods indicated on a 100%
basis). We have grouped this information by the business segment to which the entities
relate.

|                   | Summarized Income Statement Information for the Three Months Ended
|------------------ | ------------------------------------------------------------------
|
|
|Pipelines          |                                                                   
|Fractionation      |                                                                   
|Octane Enhancement |                                                                   

Our
initial investment in Promix, La Porte, Dixie, Neptune and Nemo exceeded our share of the
historical cost of the underlying net assets of such entities (the excess
cost). The excess cost of these investments is reflected in our investments in and
advances to unconsolidated affiliates for these entities. That portion of excess cost
attributable to the tangible plant and/or pipeline assets of each entity is amortized
against equity earnings from these entities in a manner similar to depreciation. That
portion of excess cost attributable to goodwill is subject to periodic impairment testing
and is not amortized.

29

---

The
following table summarizes our excess cost information at March 31, 2003 and December 31,
2002 by the business segment to which the unconsolidated affiliates relate:

|                                                                                      |  | Original Excess Cost
attributable to | Unamortized balance at
|------------------------------------------------------------------------------------- |  | ------------------------------------ | ----------------------
|
|Fractionation                                                                         |  |                                      |                       
|Pipelines                                                                             |  |                                      |                       
|                                                                                     
|(1) Goodwill is not amortized; however, it is subject to periodic impairment testing.

For
the three months ended March 31, 2003 and 2002, we recorded $0.4 million and $0.5 million,
respectively, of excess cost amortization which is reflected in our equity in income from
unconsolidated affiliates.

Purchase
of remaining 50% interest in EPIK

As
discussed in Note 3, we purchased the remaining 50% ownership interests in EPIK in March
2003. As a result of this acquisition, EPIK became a wholly-owned subsidiary of ours. We
recorded $1.8 million of equity income from EPIK for the two months that it was an
unconsolidated subsidiary during the first quarter of 2003.

# 7.     INTANGIBLE ASSETS AND
GOODWILL

# Intangible assets

The
following table summarizes our intangible assets at March 31, 2003 and December 31, 2002:

|                                                                                               |  | At March 31, 2003 | At December 31, 2002
|---------------------------------------------------------------------------------------------- |  | ----------------- | --------------------
|
|Shell natural gas processing agreement                                                         |  |                   | $                   
|Mont Belvieu Storage II contracts                                                              |  |                   |                     
|Mont Belvieu Splitter III contracts                                                            |  |                   |                     
|Toca-Western natural gas processing contracts                                                  |  |                   |                     
|Toca-Western NGL fractionation contracts                                                       |  |                   |                     
|Venice contracts (a)                                                                           |  |                   |                     
|                                                                                               | 
|Total                                                                                          |  |                   | $                   
|                                                                                               | 
|                                                                                              
|(a) Amortization scheduled to begin when contracted-volumes begin to be processed in late 2003

The following
table shows amortization expense associated with our intangible assets for the three
months ended March 31, 2003 and 2002:

|                                              | For the Three Months
Ended March 31,
|--------------------------------------------- | ------------------------------------
|
|Shell natural gas processing agreement        |                                     
|Mont Belvieu Storage II contracts             |                                     
|Mont Belvieu Splitter III contracts           |                                     
|Toca-Western natural gas processing contracts |                                     
|Toca-Western NGL fractionation contracts      |                                     
|                                              |                                     
|Total                                         |                                     
|                                              |                                     

30

---

# Goodwill

Our
goodwill is attributable to the excess of the purchase price over the fair value of assets
acquired and is comprised of the following (at March 31, 2003 and December 31, 2002):

|Mont Belvieu Splitter III acquisition |  |  | $ | 73,690 | 
|------------------------------------- |  |  | - | ------ | 
|MBA acquisition                       |  |  |   | 7,857  | 
|                                      | 
|                                      |  |  | $ | 81,547 | 
|                                      | 

Our
goodwill amounts are classified as part of the Fractionation segment since they are
related to assets recorded within this operating segment.

# 8.     DEBT OBLIGATIONS

Our
debt obligations consisted of the following at the dates indicated:

|                                                         | March 31,
2003 | December 31,
2002
|-------------------------------------------------------- | -------------- | -----------------
|Borrowings under:                                        |                |                  
|364-Day Term Loan, variable rate, due July 2003          |                |                  
|364-Day Revolving Credit facility, variable rate,        |                |                  
|due November 2004                                        |                |                  
|Multi-Year Revolving Credit facility, variable rate,     |                |                  
|due November 2005                                        |                |                  
|Senior Notes A, 8.25% fixed rate, due March 2005         |                |                  
|Seminole Notes, 6.67% fixed rate, $15 million due        |                |                  
|each December, 2002 through 2005                         |                |                  
|MBFC Loan, 8.70% fixed rate, due March 2010              |                |                  
|Senior Notes B, 7.50% fixed rate, due February 2011      |                |                  
|Senior Notes C, 6.375% fixed rate, due February 2013     |                |                  
|Senior Notes D, 6.875% fixed rate, due March 2033        |                |                  
|                                                         |               
|Total principal amount                                   |                |                  
|Unamortized balance of increase in fair value related to |                |                  
|hedging a portion of fixed-rate debt                     |                |                  
|Less unamortized discount on:                            |                |                  
|Senior Notes A                                           |                |                  
|Senior Notes B                                           |                |                  
|Senior Notes D                                           |                |                  
|Less current maturities of debt                          |                |                  
|                                                         |               
|Long-term debt                                           |                |                  
|                                                         |               

Letters
of credit. At March 31, 2003 and December 31, 2002, we had $75 million of standby
letter of credit capacity under our Multi-Year Revolving Credit facility. We had $25.7
million of letters of credit outstanding under this facility at March 31, 2003 and $2.4
million outstanding at December 31, 2002.

Parent-Subsidiary
guarantor relationships. Our parent (which is our Limited Partner) is the guarantor of
certain of our consolidated debt obligations. This parent-subsidiary guaranty provision
exists under all of our consolidated debt obligations, with the exception of the Seminole
Notes. The Seminole Notes are unsecured obligations of Seminole Pipeline Company (of which
we own an effective 78.4% of its ownership interests). If we were to default on any
guaranteed debt obligation, our Limited Partner would be responsible for full payment of
that obligation.

31

---

New
debt obligations issued during first quarter of 2003

During
the first quarter of 2003, we completed the issuance of $850 million of private placement
debt (Senior Notes C and D). Senior Notes C and D are unsecured obligations and rank
equally with its existing and future unsecured and unsubordinated indebtedness and senior
to any future subordinated indebtedness. Senior Notes C and D are guaranteed by the
Limited Partner through an unsecured and unsubordinated guarantee that is non-recourse to
the General Partner. These notes were issued under an indenture containing certain
covenants and are subject to a make-whole redemption right. These covenants restrict our
ability, with certain exceptions, to incur debt secured by liens and engage in sale and
leaseback transactions.

Senior
Notes C. In January 2003, we issued $350 million in principal amount of 6.375%
fixed-rate Senior Notes C due February 1, 2013 (Senior Notes C), from which we
received net proceeds before offering expenses of approximately $347.7 million. These
notes were sold at face value with no discount or premium. We used the proceeds from this
offering to repay a portion of the indebtedness outstanding under the 364-Day Term Loan
that we incurred to finance the Mid-America and Seminole acquisitions. In April 2003, we
initiated an offer to exchange the private placement Senior Notes C for
publicly-registered Senior Notes C.

Senior
Notes D. In February 2003, we issued $500 million in principal amount of 6.875%
fixed-rate Senior Notes due March 1, 2033 (Senior Notes D), from which we
received net proceeds before offering expenses of approximately $489.8 million. These
notes were sold at a discount of 98.842% of their face amount. We used $421.4 million from
this offering to repay the remaining principal balance outstanding under the 364-Day Term
Loan. In addition, we applied $60.0 million of the proceeds to reduce the balance
outstanding under the 364-Day Revolving Credit facility. The remaining proceeds were used
for working capital purposes.

Repayment
of 364-Day Term Loan

We
entered into a $1.2 billion senior unsecured 364-day term loan to initially fund the
acquisition of indirect interests in Mid-America and Seminole in July 2002. We used $178.5
million of the $182.5 million in proceeds from our Limited Partners October 2002
equity offering to partially repay this loan. We used $252.8 million of the $258.2 million
in proceeds from our Limited Partners January 2003 equity offering (see Note 9),
$347.0 million of the $347.7 million in proceeds from our issuance of Senior Notes C and
$421.4 million in proceeds from our issuance of Senior Notes D to completely repay the
364-Day Term Loan by February 2003.

Covenants

We
were in compliance with the various covenants of our debt agreements at March 31, 2003 and
December 31, 2002.

Information
regarding variable interest rates paid

The
following table shows the range of interest rates paid and weighted-average interest rate
paid on our variable-rate debt obligations for the three months ended March 31, 2003:

|                                              | Range of
interest rates
paid | Weighted-
average
interest rate
paid
|--------------------------------------------- | ---------------------------- | ------------------------------------
|364-Day Term Loan (a)                         |                              |                                     
|364-Day Revolving Credit facility             |                              |                                     
|Multi-Year Revolving Credit facility          |                              |                                     
|                                             
|(a) This facility was repaid in February 2003

32

---

# 9.     CAPITAL STRUCTURE

We
are owned 98.9899% by our Limited Partner and 1.0101% by our General Partner. The rights
available to our partners are described in our Amended and Restated Agreement of
Limited Partnership dated July 31, 1998. We are managed by our General Partner.

In
January 2003, our Limited Partner completed an equity offering from which we received a
cash contribution of $258.2 million, which includes our General Partners related
capital contribution of $2.6 million. We used $252.8 million of the proceeds from this
offering to repay a portion of the indebtedness outstanding under the 364-Day Term Loan.
The remaining balance of proceeds was used for working capital purposes and offering
expenses.

# 10.     SUPPLEMENTAL CASH
FLOWS DISCLOSURE

The net effect of changes in
operating accounts and liabilities is as follows:

|                                            | For the Three Months
Ended March 31,
|------------------------------------------- | ------------------------------------
|
|(Increase) decrease in:                     |                                     
|Accounts and notes receivable               |                                     
|Inventories                                 |                                     
|Prepaid and other current assets            |                                     
|Other assets                                |                                     
|Increase (decrease) in:                     |                                     
|Accounts payable                            |                                     
|Accrued gas payable                         |                                     
|Accrued expenses                            |                                     
|Accrued interest                            |                                     
|Other current liabilities                   |                                     
|Other liabilities                           |                                     
|                                            |                                     
|Net effect of changes in operating accounts |                                     
|                                            |                                     

During
the three months ended March 31, 2003, we completed two small business acquisitions and
made minor adjustments to the purchase price allocation of the Mid-America and Seminole
acquisitions. These acquisitions and adjustments affected various balance sheet accounts
(see Note 3). The 2002 period reflects our acquisition of Diamond-Kochs Mont Belvieu
NGL and petrochemical storage business in January 2002 and their adjacent propylene
fractionation business (Splitter III) in February 2002.

We
record certain financial instruments relating to commodity positions and interest rate
hedging activities at their respective fair values using mark-to-market accounting. For
the three months ended March 31, 2002, we recognized a net $30.1 million in non-cash
mark-to-market decreases in the fair value of these instruments, primarily in our
commodity financial instruments portfolio. We had a limited number of such positions
outstanding during the first quarter of 2003 and the non-cash change in fair value of
these instruments was an increase of $28 thousand.

Cash
and cash equivalents (as shown on our Statements of Consolidated Cash Flows) excludes
restricted cash amounts held by a brokerage firm as margin deposits associated with our
financial instruments portfolio and for our physical purchase transactions made on the
NYMEX exchange. The restricted cash balance at March 31, 2003 and December 31, 2002 was
$18.8 million and $8.8 million, respectively.

33

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# 11.     FINANCIAL INSTRUMENTS

We
are exposed to financial market risks, including changes in commodity prices and interest
rates. We may use financial instruments (i.e., futures, forwards, swaps, options, and
other financial instruments with similar characteristics) to mitigate the risks of certain
identifiable and anticipated transactions, primarily within our Processing segment. In
general, the types of risks we attempt to hedge are those relating to the variability of
future earnings and cash flows caused by changes in commodity prices and interest rates.
As a matter of policy, we do not use financial instruments for speculative (or trading)
purposes.

Commodity
hedging financial instruments

During
the first three months of 2002, we recognized a loss of $45.1 million from our Processing
segments commodity hedging activities that was recorded as an operating cost in our
Statements of Consolidated Operations and Comprehensive Income. In March 2002, the
effectiveness of our primary commodity hedging strategy at the time deteriorated due to an
unexpected rapid increase in natural gas prices whereby the loss in value of our
fixed-price natural gas financial instruments was not offset by increased gas processing
margins. We exited the strategy underlying this loss in 2002.

During
the first three months of 2003, we held a limited number of commodity financial
instruments from which we recorded a loss of $0.9 million ($0.1 million was attributable
to the Processing segment and the remainder to the Pipelines segment). The fair value of
open positions at March 31, 2003 was a receivable of approximately $2 thousand.

Interest
rate hedging financial instruments

During
the fourth quarter of 2002, we entered into seven treasury lock transactions. Each
treasury lock transaction carried a maturity date of either January 31, 2003 or April 15,
2003. The purpose of these transactions was to hedge the underlying U.S. treasury interest
rate associated with our anticipated issuance of debt in early 2003 to refinance the
Mid-America and Seminole acquisitions. The notional amounts of these transactions totaled
$550 million, with a total treasury lock rate of approximately 4%.

Our
treasury lock transactions are accounted for as cash flow hedges under SFAS No. 133. The
fair value of these instruments at December 31, 2002 was a current liability of $3.8
million offset by a current asset of $0.2 million. The net $3.6 million non-cash
mark-to-market liability was recorded as a component of comprehensive income on that date,
with no impact to current earnings.

We
settled all of the treasury locks by early February 2003 in connection with our issuance
of Senior Notes C and D (see Note 8). The settlement of these instruments resulted in our
receipt of $5.4 million of cash. This amount was recorded as a gain in other comprehensive
income during the first quarter of 2003 and represents the effective portion of the
treasury locks.

Of
the $5.4 million recorded in other comprehensive income during the first quarter of 2003,
$4.0 million is attributable to our issuance of Senior Notes C and is being amortized to
earnings as a reduction in interest expense over the 10-year term of this debt. The
remaining $1.4 million is attributable to our issuance of Senior Notes D and is being
amortized to earnings as a reduction in interest expense over the 10-year term of the
anticipated transaction as required by SFAS No. 133. The estimated amount to be
reclassified from accumulated other comprehensive income to earnings during 2003 is $0.4
million. With the settlement of the treasury locks, the $3.6 million non-cash
mark-to-market liability recorded at December 31, 2002 was reclassified out of accumulated
other comprehensive income in Partners Equity to offset the current asset and
liability we recorded at December 31, 2002 with no impact to earnings.

34

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# 12.     SEGMENT INFORMATION

We
have five reportable operating segments: Pipelines, Fractionation, Processing, Octane
Enhancement and Other. The reportable segments are generally organized according to the
type of services rendered (or process employed) and products produced and/or sold, as
applicable. The segments are regularly evaluated by the Chief Executive Officer of the
General Partner. Pipelines consists of NGL, petrochemical and natural gas pipeline
systems, storage and import/export terminal services. Fractionation primarily includes NGL
fractionation, isomerization, and polymer-grade and chemical-grade propylene fractionation
services. Processing includes the natural gas processing business and its related NGL
marketing activities. Octane Enhancement represents our equity interest in BEF, a facility
that produces motor gasoline additives to enhance octane (currently producing MTBE). The
Other operating segment consists of fee-based marketing services and various operational
support activities.

We
evaluate segment performance based on the non-GAAP financial measure of gross operating
margin. We define gross operating margin as operating income before: (1) depreciation and
amortization amounts; (2) operating lease expenses for which the partnership does not have
the payment obligation; (3) gains and losses on the sale of assets; and (4) selling,
general and administrative expenses. Gross operating margin is exclusive of other income
and expense transactions, provision for income taxes, minority interest and extraordinary
charges. Segment gross operating margin is derived by subtracting segment operating costs
and expenses (before depreciation and amortization amounts, operating lease expenses for
which the partnership does not have the payment obligation and gains and losses on the
sale of assets) from segment revenues, with both segment totals before elimination of
intercompany transactions. Intercompany accounts and transactions are eliminated in
consolidation in accordance with GAAP. Segment gross operating margin is also exclusive of
other income and expense transactions, provision for income taxes, minority interest and
extraordinary charges. We have provided a reconciliation of total gross operating margin
(a non-GAAP performance measure) to operating income.

35

---

The
following table shows our measurement of total segment gross operating margin for the
periods indicated:

|                                                                                                                                                                                                                                                                                                                                              | For the Three Months
Ended March 31,
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------
|
|Revenues (a)                                                                                                                                                                                                                                                                                                                                  |                                     
|Less operating costs and expenses (a)                                                                                                                                                                                                                                                                                                         |                                     
|Add equity in income of unconsolidated affiliates (b)                                                                                                                                                                                                                                                                                         |                                     
|                                                                                                                                                                                                                                                                                                                                              |                                     
|Subtotal                                                                                                                                                                                                                                                                                                                                      |                                     
|Add:   Depreciation and amortization in operating costs and expenses (c)                                                                                                                                                                                                                                                                      |                                     
|Retained lease expense, net in operating expenses allocable to us (d)                                                                                                                                                                                                                                                                         |                                     
|Loss on sale of assets in operating costs and expenses(c)                                                                                                                                                                                                                                                                                     |                                     
|                                                                                                                                                                                                                                                                                                                                              |                                     
|Total segment gross operating margin                                                                                                                                                                                                                                                                                                          |                                     
|                                                                                                                                                                                                                                                                                                                                              |                                     
|                                                                                                                                                                                                                                                                                                                                             
|(a)  These amounts are comprised of both third party and related party totals as shown on our Statements of Consolidated Operations and Comprehensive Income.                                                                                                                                                                                
|(b)  This amount is taken directly from our Statements of Consolidated Operations and Comprehensive Income.                                                                                                                                                                                                                                  
|(c)  This amount is taken directly from the operating activities section of our Statements of Consolidated Cash Flows.                                                                                                                                                                                                                        |                                     
|(d)  This non-cash amount represents the value of the operating leases contributed by EPCO to us for which EPCO has retained the cash payment obligation (the "retained leases"). This amount is taken from the operating activities
section ("Operating lease expense paid by EPCO" line item) of our Statements of Consolidated Cash Flows.
|                                                                                                                                                                                                                                                                                                                                              |                                     
|                                                                                                                                                                                                                                                                                                                                              |                                     

The
following table reconciles GAAP operating income as shown in our Statements of
Consolidated Operations and Comprehensive Income to total segment gross operating margin
(a non-GAAP financial measure):

|                                                              | For the Three Months
Ended March 31,
|------------------------------------------------------------- | ------------------------------------
|
|Operating income (loss)                                       |                                     
|Adjustments to reconcile operating income (loss)              |                                     
|to total segment gross operating margin:                      |                                     
|Depreciation and amortization in operating costs and expenses |                                     
|Operating lease expenses for which EPCO has retained the cash |                                     
|payment obligation, net in operating costs and expenses       |                                     
|Loss on sale of assets in operating costs and expenses        |                                     
|Selling, general and administrative costs                     |                                     
|                                                              |                                     
|Total segment gross operating margin                          |                                     
|                                                              |                                     

36

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Information
by operating segment, together with reconciliations to the consolidated totals, is
presented in the following table:

|                                     | Operating Segments | Adjs. |  
|------------------------------------ | ------------------ | ----- | -
|
|Revenues from                        |                    |       |  
|third parties:                       |                    |      
|Three months ended March 31, 2003    |                    |       | $
|Three months ended March 31, 2002    |                    |       |  
|Revenues from                        |                    |      
|related parties:                     |                    |      
|Three months ended March 31, 2003    |                    |       |  
|Three months ended March 31, 2002    |                    |       |  
|Intersegment and intrasegment        |                    |      
|revenues:                            |                    |      
|Three months ended March 31, 2003    |                    |       |  
|Three months ended March 31, 2002    |                    |       |  
|Total revenues:                      |                    |      
|Three months ended March 31, 2003    |                    |       |  
|Three months ended March 31, 2002    |                    |       |  
|Equity income in                     |                    |      
|unconsolidated affiliates:           |                    |      
|Three months ended March 31, 2003    |                    |       |  
|Three months ended March 31, 2002    |                    |       |  
|Gross operating margin by individual |                    |      
|business segment and in total:       |                    |      
|Three months ended March 31, 2003    |                    |       |  
|Three months ended March 31, 2004    |                    |       |  
|Segment assets:                      |                    |      
|At March 31, 2003                    |                    |       |  
|At December 31, 2002                 |                    |       |  
|Investments in and advances          |                    |      
|to unconsolidated affiliates:        |                    |      
|At March 31, 2003                    |                    |       |  
|At December 31, 2002                 |                    |       |  
|Intangible Assets:                   |                    |      
|At March 31, 2003                    |                    |       |  
|At December 31, 2002                 |                    |       |  
|Goodwill:                            |                    |      
|At March 31, 2003 and                |                    |      
|December 31, 2002                    |                    |       |  

Our
revenues are derived from a wide customer base. All consolidated revenues during the first
quarter of 2003 and first quarter of 2002 were earned in the United States. Total
consolidated revenues for the three months ended March 31, 2003 increased $819.5 million
over those recorded during the same period in 2002. The majority of this increase is
attributable to higher NGL prices, which (on a weighted-average basis for industry index
prices) were 63 CPG during the first quarter of 2003 compared to 33 CPG during the first
quarter of 2002. The higher NGL prices resulted in a significant increase in Processing
segment revenues (particularly those of its NGL marketing activities component).

Also,
higher natural gas prices during the first quarter of 2003 when compared to the first
quarter of 2002 resulted in a substantial increase in Pipeline segment revenues from our
Acadian Gas subsidiary. As part of its normal operations, Acadian Gas purchases natural
gas from producers and suppliers and resells such natural gas to customers such as
electric utility companies. The average index price for natural gas was $6.58 per MMBtu
during the first quarter of 2003 versus $2.34 per MMBtu during the first quarter of 2002.

37

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In
addition to the effect of higher NGL and natural gas prices, consolidated revenues also
increased as a result of acquisitions. Our Mid-America and Seminole pipeline systems
contributed $82.5 million in revenues during the first three months of 2003.

Total
segment gross operating margin was $126.4 million for the first quarter of 2003 compared
to $26.3 million for the first quarter of 2002. The primary reasons for the increase are
(i) the 2003 period includes $47.5 million of gross operating margin from Mid-America and
Seminole (we acquired these operations in July 2002) and (ii) the 2002 period included
$45.1 million in commodity hedging losses. Mid-America and Seminoles gross operating
margin is classified under our Pipelines segment while commodity hedging results are
primarily a function of our Processing segment activities.

# 13.     PROVISION FOR INCOME
TAXES

Provision
for income taxes is primarily applicable to the tax obligation of a consolidated
subsidiary, Seminole Pipeline Company, which is a corporation and subject to income taxes.
Seminole Pipeline Company became a consolidated subsidiary on August 1, 2002. The
following is a summary of our provision for income taxes for the three months ended March
31, 2003:

|Current:                   |  |  |   |       | 
|-------------------------- |  |  | - | ----- | 
|Federal tax benefit        |  |  | $ | 349   | 
|State tax benefit          |  |  |   | 47    | 
|                           | 
|                           |  |  |   | 396   | 
|                           | 
|Deferred:                  |  | 
|Federal                    |  |  |   | 2,409 | 
|State                      |  |  |   | 324   | 
|                           | 
|                           |  |  |   | 2,733 | 
|                           | 
|Provision for income taxes |  |  | $ | 3,129 | 
|                           | 

The
following is a reconciliation of our provision for income taxes at the federal statutory
rate to our recorded provision for income taxes:

|Taxes computed by applying the federal statutory rate |  |  | $ | 2,888 | 
|----------------------------------------------------- |  |  | - | ----- | 
|State income taxes (net of federal benefit)           |  |  |   | 241   | 
|                                                      | 
|Provision for income taxes                            |  |  | $ | 3,129 | 
|                                                      | 

Significant
components of deferred income tax assets and liabilities at March 31, 2003 are as follows:

|Deferred tax assets:          |  |  |   |        |  
|----------------------------- |  |  | - | ------ | -
|Property, plant and equipment |  |  | $ | 13,113 |  
|Deferred tax liabilities:     |  | 
|Other                         |  |  |   | (619   | )
|                              | 
|Net deferred tax assets       |  |  | $ | 12,494 |  
|                              | 

Based
upon the periods in which taxable temporary differences are anticipated to reverse, we
believe it is more likely than not that the Company will realize the benefits of these
deductible differences. Accordingly, we believe that no valuation allowance is required
for the deferred tax assets. However, the amount of the deferred tax asset considered
realizable could be adjusted in the future if estimates of reversing taxable temporary
differences are revised.

38

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# 14.     UNIT OPTION PLAN
ACCOUNTING

During
1998, EPCO adopted its 1998 Long-Term Incentive Plan (the 1998 Plan). Under
the 1998 Plan, non-qualified incentive options to purchase a fixed number of our Common
Units (the Units) may be granted to EPCOs key employees who perform
management, administrative or operational functions for us. The exercise price per Unit,
vesting and expiration terms, and rights to receive distributions on Units granted are
determined by EPCO for each grant. EPCO funds the purchase of the Units under the 1998
Plan at fair value in the open market. In general, our responsibility for reimbursing EPCO
for the expense it incurs when these options are exercised is as follows:

| |  | We pay EPCO for the costs attributable to equity-based awards granted to operations personnel it employs on our
behalf.
| | - | -----------------------------------------------------------------------------------------------------------------------

| |  | We pay EPCO for the costs attributable to equity-based awards granted to
administrative and management personnel it hires in response to our expansion and business activities.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | We pay EPCO for our share of the costs attributable to equity-based awards granted to
certain of its employees in administrative and management positions that were active at
the time of our initial public offering in July 1998 who manage our business and affairs.
These costs are reimbursed through the administrative service fees we pay EPCO. EPCO is
responsible for the actual costs of such awards when these options are exercised.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

We
account for our share of the cost of these awards using the intrinsic value-based method
in accordance with APB No. 25, Accounting for Stock Issued to Employees. The
exercise price of each option granted is equivalent to the market price of the Unit at the
date of grant. Accordingly, no compensation expense related to Unit option grants is
recognized in the Statements of Consolidated Operations and Comprehensive Income until the
grants are exercised by the employee.

Accounting
principles require us to illustrate the pro forma effect on our net income (loss) as if
the fair value-based method of accounting, based on SFAS No. 123, Accounting for
Stock Based Compensation, had been applied to the 1998 Plan. The following table
shows these pro forma effects for the periods indicated:

|                                          | For the Three Months
Ended March 31,
|----------------------------------------- | ------------------------------------
|
|Net income (loss):                        |                                     
|As reported                               |                                     
|Additional Unit option-based compensation |                                     
|expense estimated using the               |                                     
|fair value-based method                   |                                     
|                                          |                                     
|Pro forma                                 |                                     
|                                          |                                     

39

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# Item 2.   
MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION  AND RESULTS OF
OPERATIONS.

# For the three months
ended March 31, 2003 and 2002.

Enterprise
Products Partners L.P. is a publicly-traded limited partnership (NYSE, symbol
EPD) that conducts substantially all of its business through its 98.9899%
owned subsidiary, Enterprise Products Operating L.P.(the Operating
Partnership), the Operating Partnerships subsidiaries, and a number of
investments with industry partners. Since the Operating Partnership owns substantially all
of Enterprise Products Partners L.P.s consolidated assets and conducts substantially
all of its business and operations, the information set forth herein constitutes combined
information for the two registrants. Unless the context requires otherwise, references to
we, us, our or the Company are intended to
mean the consolidated business and operations of Enterprise Products Partners L.P., which
includes Enterprise Products Operating L.P. and its subsidiaries.

The
following discussion and analysis should be read in conjunction with the unaudited
consolidated financial statements and notes thereto of the Company and Operating
Partnership included in Part I of this quarterly report on Form 10-Q.

# Our results of operations

We
have five reportable operating segments: Pipelines, Fractionation, Processing, Octane
Enhancement and Other. Pipelines consists of NGL, petrochemical and natural gas pipeline
systems, storage and import/export terminal services. Fractionation primarily includes NGL
fractionation, isomerization and propylene fractionation. Processing includes our natural
gas processing business and related NGL marketing activities. Octane Enhancement
represents our interest in a facility that produces motor gasoline additives to enhance
octane (currently producing MTBE). The Other operating segment consists of fee-based
marketing services and various operational support activities.

We
evaluate segment performance based on our measurement of gross operating margin (in the
aggregate and by segment). This non-generally accepted accounting principle financial
measure is used in this quarterly report. Amounts included in the calculation of this
measure are computed in accordance with generally accepted accounting principles
(GAAP). As part of our quarterly report, we have provided a reconciliation of
this non-GAAP financial measure to its most comparable financial measure calculated and
presented in accordance with GAAP.

We
believe that investors benefit from having access to the same financial measures being
utilized by management. Gross operating margin is an important performance measure of the
economic success of our core operations and individual asset locations. This measure forms
the basis of our internal financial reporting and is used by senior management in deciding
how to allocate capital resources among segments. The nearest GAAP counterpart to gross
operating margin is operating income. Operating income, however, includes expense items
that management does not consider when evaluating the core profitability of an operation
such as depreciation and selling, general and administrative costs.

We
define gross operating margin as operating income before: (1) depreciation and
amortization amounts; (2) operating lease expenses for which the partnership does not have
the payment obligation; (3) gains and losses on the sale of assets; and (4) selling,
general and administrative expenses. Gross operating margin is exclusive of other income
and expense transactions, provision for income taxes, minority interest and extraordinary
charges. Segment gross operating margin is derived by subtracting segment operating costs
and expenses (before depreciation and amortization amounts, operating lease expenses for
which the partnership does not have the payment obligation and gains and losses on the
sale of assets) from segment revenues, with both segment totals before elimination of
intercompany transactions. Intercompany accounts and transactions are eliminated in
consolidation in accordance with GAAP. Segment gross operating margin is also exclusive of
other income and expense transactions, provision for income taxes, minority interest and
extraordinary charges. We have reconciled total gross operating margin (a non-GAAP
performance measure) to operating income.

40

---

We
include equity earnings from unconsolidated affiliates in our measurement of segment gross
operating margin. Our equity investments with industry partners are a vital component of
our business strategy. They are a means by which we conduct our operations to align our
interests with our customers which may be a supplier of raw materials or a consumer of
finished products. This method of operation also enables us to achieve favorable economies
of scale relative to the level of investment and business risk assumed versus what we
could accomplish on a stand alone basis. Many of these businesses perform supporting or
complementary roles to our other business operations. For additional information regarding
our business segments, see footnote 12 of our Notes to Unaudited Consolidated Financial
Statements included under Item 1 of this quarterly report.

The
following table shows our consolidated revenues, costs and expenses, equity in income of
unconsolidated affiliates and operating income (loss) for the periods indicated (dollars
in thousands):

|                                              | For the Three Months
Ended March 31,
|--------------------------------------------- | ------------------------------------
|
|Revenues                                      |                                     
|Operating costs and expenses                  |                                     
|Selling, general and administrative costs     |                                     
|Equity in income of unconsolidated affiliates |                                     
|Operating income (loss)                       |                                     

The
following table reconciles consolidated operating income (loss) to our measurement of
total gross operating margin for the periods indicated (dollars in thousands):

|                                                              | For the Three Months
Ended March 31,
|------------------------------------------------------------- | ------------------------------------
|
|Operating income (loss)                                       |                                     
|Adjustments to reconcile operating income (loss)              |                                     
|to total segment gross operating margin:                      |                                     
|Depreciation and amortization in operating costs and expenses |                                     
|Operating lease expenses for which EPCO has retained the cash |                                     
|payment obligation, net in operating costs and expenses       |                                     
|Loss on sale of assets in operating costs and expenses        |                                     
|Selling, general and administrative costs                     |                                     
|                                                              |                                     
|Total segment gross operating margin                          |                                     
|                                                              |                                     

EPCO
subleases certain equipment to us located at our Mont Belvieu facility and 100 railroad
tankcars for $1 dollar per year. These subleases (the retained leases) are
part of the EPCO Agreement we executed with EPCO at our formation in 1998. EPCO holds
these items pursuant to operating leases for which it has retained the corresponding cash
lease payment obligation. Operating costs and expenses (as shown in the Statements of
Consolidated Operations and Comprehensive Income) treat the lease payments being made by
EPCO as a non-cash related party operating expense, with the offset to Partners
Equity on the Consolidated Balance Sheets recorded as a general contribution to the
Company. Apart from the partnership interests we granted to EPCO at our formation, EPCO
does not receive any additional ownership rights as a result of its contribution to us of
the retained leases. In addition, EPCO has assigned to us the purchase options associated
with these leases. For additional information regarding the EPCO Agreement and the
retained leases, see Related party transactions on page 50 and
Capital spending on page 49 of this quarterly report.

41

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Our
gross operating margin amounts by segment were as follows for the periods indicated
(dollars in thousands):

|                                   | For the Three Months
Ended March 31,
|---------------------------------- | ------------------------------------
|
|Gross operating margin by segment: |                                     
|Pipelines                          |                                     
|Fractionation                      |                                     
|Processing                         |                                     
|Octane enhancement                 |                                     
|Other                              |                                     
|                                   |                                     
|Gross operating margin total       |                                     
|                                   |                                     

Our
significant plant production and other volumetric data were as follows for the periods
indicated:

|                                             | For the Three Months
Ended March 31,
|-------------------------------------------- | ------------------------------------
|
|MBPD, Net                                    |                                     
|NGL and Petrochemical Pipelines              | 1,348                               
|NGL Fractionation                            | 240                                 
|Propylene Fractionation                      | 61                                  
|Isomerization                                | 80                                  
|Equity NGL Production                        | 54                                  
|Octane Enhancement                           | 3                                   
|                                             |                                     
|BBtus per day, Net                          
|Natural Gas Pipelines                        | 1,055                               
|                                             |                                     
|Equivalent MBPD, Net                        
|NGL, petrochemical and natural gas pipelines | 1,626                               

The
following table illustrates selected average quarterly industry index prices for natural
gas, crude oil and selected NGL and petrochemical products since the beginning of 2002:

|            | Natural
Gas,
$/MMBtu | Crude Oil,
$/barrel | Ethane,
$/gallon | Propane,
$/gallon | Normal
Butane,
$/gallon | Isobutane,
$/gallon | Polymer
Grade
Propylene,
$/pound | Refinery
Grade
Propylene,
$/pound
|----------- | -------------------- | ------------------- | ---------------- | ----------------- | ----------------------- | ------------------- | -------------------------------- | ---------------------------------
|
|2002        |                      |                     |                  |                   |                         |                     |                                  |                                  
|1st Quarter |                      |                     | $                | 2.34              |                         | $                   | 21.41                            |                                  
|2nd Quarter |                      |                     | $                | 3.38              |                         | $                   | 26.26                            |                                  
|3rd Quarter |                      |                     | $                | 3.16              |                         | $                   | 28.30                            |                                  
|4th Quarter |                      |                     | $                | 3.99              |                         | $                   | 28.33                            |                                  
|           
|Average     |                      |                     | $                | 3.22              |                         | $                   | 26.08                            |                                  
|           
|2003        |                      |                    
|1st Quarter |                      |                     | $                | 6.58              |                         | $                   | 34.07                            |                                  

(a)    
          Natural , NGL, polymer grade propylene and refinery grade propylene prices
          represent an average of various commercial index prices including OPIS and CMAI(b)    

          Crude Oil price is representative of the index price for West Texas Intermediate

42

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Three months ended March 31, 2003
compared to three months ended March 31, 2002

Revenues,
operating costs and expenses, operating income and total gross operating margin.

Revenues
for the three months ended March 31, 2003 increased $819.5 million over those recorded
during the same period in 2002. The increase is primarily due to higher NGL, propylene and
natural gas prices (see comparative product prices chart on page 42). The higher NGL
prices resulted in a significant increase in Processing segment revenues (particularly
those of its NGL marketing activities component). The higher propylene prices contributed
to an increase in the revenues we derive from our petrochemical marketing activities.
Also, the higher natural gas prices quarter-to-quarter resulted in an increase in Pipeline
segment revenues from our Acadian Gas subsidiary. As part of its normal operations,
Acadian Gas purchases natural gas from producers and suppliers and resells such natural
gas to customers such as electric utility companies. Lastly, revenues increased as a
result of acquisitions we completed since March 31, 2002 (particularly our acquisition of
indirect interests in Mid-America and Seminole in July 2002).

Operating
costs and expenses for the three months ended March 31, 2003 were $722.2 million higher
than those recorded for the same period in 2002. The increase is primarily due to the same
reasons that caused our revenues to be higher. As a result of the higher NGL, propylene
and natural gas prices, the prices we paid for feedstocks and inventories increased. This
affected our NGL and petrochemical marketing activities as well as our Acadian Gas natural
gas purchases. In addition to the increase in product purchase prices, operating costs and
expenses also increased as a result of acquisitions.

Our
operating costs and expenses for the first three months of 2002 include a $45.1 million
loss we recognized from our commodity hedging activities. In March 2002, the effectiveness
of our primary commodity hedging strategy at the time deteriorated due to an unexpected
rapid increase in natural gas prices whereby the loss in value of our fixed-price natural
gas financial instruments was not offset by increased gas processing margins. We exited
the strategy underlying this loss in 2002. During the first three months of 2003, we
recorded a loss of $0.9 million from our commodity hedging activities.

Operating
income was $85.0 million for the first three months of 2003 compared to a loss of $1.2
million for the first three months of 2002. Total gross operating margin was $126.4
million for the 2003 period versus $26.3 million for the 2002 period. The primary reasons
for the increase in operating income and total gross operating margin are (i) the 2003
period includes results from our recently acquired Mid-America and Seminole pipeline
systems and (ii) the 2002 period includes $45.1 million in commodity hedging losses. From
a gross operating margin standpoint, Mid-America and Seminole contributed $47.5 million
for the first quarter of 2003.

The
following information highlights the significant quarter-to-quarter variances in gross
operating margin by operating segment:

Pipelines.  
          Gross operating margin from our Pipelines segment was $71.9 million for the
          first quarter of 2003 compared to $32.7 million for the first quarter of 2002.
          On an energy-equivalent basis, net pipeline throughput volume was 1,626 MBPD for
          the 2003 period versus 859 MBPD for the 2002 period. The increase in gross
          operating margin and throughput volume is primarily due to the acquisition of
          Mid-America and Seminole. These systems earned gross operating margin of $47.5
          million on volumes of 816 MBPD for the first quarter of 2003. This
          acquisitions-related increase was offset by a decrease in gross operating margin
          from our Louisiana Pipeline System and our storage operations. Gross operating
          margin from our Louisiana Pipeline System declined $2.4 million
          quarter-to-quarter primarily due to lower throughput volumes attributable to a
          decrease in NGL extraction rates at regional gas processing facilities. Gross
          operating margin from our NGL and petrochemical storage operations was $4.7
          million lower quarter-to-quarter as a result of higher storage well charges.

Fractionation.  
          Gross operating margin from our Fractionation segment was $29.0 million for the
          first quarter of 2003 compared to $24.4 million for the first quarter of 2002.
          Gross operating margin from NGL fractionation improved $2.2 million
          quarter-to-quarter primarily due to an increase in in-kind fees at our Norco
          facility due to higher NGL prices. NGL fractionation volumes were 240 MBPD
          during the first three months of 2003 compared to 204 MBPD during the first
          three months of 2002. Gross operating margin from propylene fractionation
          declined $2.8 million quarter-to-quarter primarily due to higher energy-related
          costs, unscheduled

43

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maintenance at one of our propylene
fractionators and lower petrochemical marketing margins. Propylene fractionation volumes
were 61 MBPD during the 2003 period versus 52 MBPD during the 2002 period. Gross operating
margin from isomerization increased $3.6 million quarter-to-quarter primarily due to
higher volumes and NGL by-product revenues. Isomerization volumes increased to 80 MBPD
during the 2003 period from 74 MBPD during the 2002 period. Gross operating margin for our
Fractionation segment also includes a one-time benefit of $1.1 million resulting from the
settlement of a business interruption and related insurance claims involving Fractionation
segment assets used to support our BEF investment.

Processing.  
          Gross operating margin from our Processing segment was $30.0 million for the
          first quarter of 2003 compared to a loss of $33.4 million for the first quarter
          of 2002. As noted under our discussion of operating costs and expenses on page
          43, the 2002 period includes commodity hedging losses of $45.1 million. Our
          commodity hedging results for the first quarter of 2003 were negligible. During
          the first quarter of 2003, our NGL marketing activities benefited from higher
          NGL prices and strong demand for propane and normal butane. This more than
          offset the decrease in gross operating margin caused by a decrease in equity NGL
          production from 81 MBPD during the 2002 period to 54 MBPD in the 2003 period.

The
decrease in equity NGL production was largely attributable to higher natural gas prices
relative to NGL prices, which caused us to minimize the amount of NGLs that were extracted
by our natural gas processing facilities. In order to meet the natural gas processing
needs of Shell (our largest processing customer) in this difficult pricing environment, we
renegotiated certain aspects of the 20-year Shell natural gas processing agreement during
the first quarter of 2003. For a general discussion of this amendment, see our discussion
entitled Related party transactions on page 50.

Octane
enhancement.   Our equity earnings from BEF were a loss of $3.4 million for the first
quarter of 2003 compared to income of $3.0 million for the first quarter of 2002. The
quarter-to-quarter decline in equity earnings is attributable to increased downtime
related to maintenance activities (which contributed to higher maintenance expenses);
lower MTBE sales margins (primarily due to high methanol feedstock prices); and MTBE
inventory valuation adjustments. BEFs gross MTBE production rate declined to 10.1
MBPD during the first quarter of 2003 from 13.5 MBPD during the first quarter of 2002. We
held a 33.3% ownership interest in BEF during both periods.

Selling,
general and administrative expenses.   These expenses were $11.5 million for the first
quarter of 2003 versus $8.0 million for the first quarter of 2002. The increase is
primarily due to the additional staff and resources needed to support our expansion
activities resulting from acquisitions and other business development. The 2003 period
includes a $2.0 million payment we made to Williams for general and administrative
transition services related to our acquisition of the Mid-America and Seminole pipelines.
These payments ceased in February 2003 when we took over the operation of these two
systems.

Interest
expense.   Interest expense increased to $41.9 million for the first quarter of 2003
from $18.5 for the first quarter of 2002. The increase is primarily due to debt
obligations we incurred as a result of business acquisitions, particularly the $1.2
billion in overall financing used to purchase Mid-America and Seminole in July 2002.

Interest
expense for the 2003 period includes a non-cash charge of $11.3 million related to
unamortized costs associated with the 364-Day Term Loan that we used to initially fund the
Mid-America and Seminole acquisitions. In February 2003, we completely repaid this loan.
As a result, all unamortized costs associated with this debt was charged to expense. For
more information regarding our debt obligations and changes since December 31, 2002,
please see Our liquidity and capital resources  Our debt
obligations.

# Our liquidity and
capital resources

The
following represents a combined discussion of our liquidity and capital resources and
those of our Operating Partnership. Within this section, references to partnership equity
pertains to limited partner interests issued by us, whereas references to debt pertains to
those obligations entered into by our Operating Partnership or its subsidiaries.

44

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General

Our
primary cash requirements, in addition to normal operating expenses and debt service, are
for capital expenditures (both sustaining and expansion-related), business acquisitions
and distributions to our partners. We expect to fund our short-term needs for such items
as operating expenses and sustaining capital expenditures with operating cash flows.
Capital expenditures for long-term needs resulting from internal growth projects and
business acquisitions are expected to be funded by a variety of sources including (either
separately or in combination) cash flows from operating activities, borrowings under
commercial bank credit facilities, the issuance of additional partnership equity and
public or private placement debt. We expect to fund cash distributions to partners
primarily with operating cash flows. Our debt service requirements are expected to be
funded by operating cash flows and/or refinancing arrangements.

Operating
cash flows primarily reflect the effects of net income adjusted for depreciation and
amortization, equity income and cash distributions from unconsolidated affiliates,
fluctuations in fair values of financial instruments and changes in operating accounts.
The net effect of changes in operating accounts is generally the result of timing of sales
and purchases near the end of each period. Cash flow from operations is primarily based on
earnings from our business activities. As a result, these cash flows are exposed to
certain risks. The products that we process, sell or transport are principally used as
feedstocks in petrochemical manufacturing, in the production of motor gasoline and as fuel
for residential, agricultural and commercial heating. Reduced demand for our products or
services by industrial customers, whether because of general economic conditions, reduced
demand for the end products made with our products, increased competition from
petroleum-based products due to pricing differences or other reasons, could have a
negative impact on earnings and thus the availability of cash from operating activities.
Other risks include fluctuations in NGL and energy prices, competitive practices in the
midstream energy industry and the impact of operational and systems risks. For a more
complete discussion of these and other risk factors pertinent to our businesses, see
Cautionary Statement regarding Forward-Looking Information and Risk
Factors on page 56 of this quarterly report.

As
noted above, certain of our liquidity and capital resource requirements are fulfilled by
borrowings made under debt agreements and/or proceeds from the issuance of additional
partnership equity. At March 31, 2003, we had approximately $2.0 billion outstanding under
various debt agreements. On that date, total borrowing capacity under our revolving
commercial bank credit facilities was $500 million of which $217.3 million of capacity was
available. For additional information regarding our debt, see Our debt
obligations on page 48.

In
February 2001, we filed a universal shelf registration with the SEC covering the issuance
of up to $500 million of partnership equity or public debt obligations. In October 2002,
we sold 9.8 million Common Units under this shelf registration statement which generated
$182.5 million of cash to us (including related capital contributions from our General
Partner). In January 2003, we sold an additional 14.7 million Common Units under this
shelf registration which generated $258.2 million of cash to us (including related capital
contributions from our General Partner). We used the cash generated by these equity
offerings to reduce debt outstanding under our 364-Day Term Loan and for working capital
purposes. Also, in January and February 2003, we issued $850 million of private placement
debt (Senior Notes C and D). For information regarding our application of cash generated
by these debt offerings, please read the section titled Our debt
obligations within this Our liquidity and capital resources
discussion.

In
January 2003, we filed a new $1.5 billion universal shelf registration statement with the
SEC covering the issuance of an unallocated amount of partnership equity or public debt
obligations (separately or in combination). In accordance with Rule 457(p) promulgated
under the Securities Act of 1933, as amended, the registration fee associated with the
unsold portion of the securities under the shelf registration statement filed in February
2001 was used to offset the registration fee due in connection with our $1.5 billion
universal shelf registration statement. When our new shelf registration was declared
effective by the SEC in April 2003, the securities remaining under the shelf registration
statement filed in February 2001 were deemed deregistered.

We
have the ability to issue an unlimited number of Common Units to finance acquisitions and
capital improvements if Adjusted Operating Surplus (as defined within our partnership
agreement) for each of the four fiscal quarters immediately preceding the expenditure, on
a pro forma basis, would have increased as a result of such expenditure (i.e., would have
been accretive on a pro forma basis for each of the quarters in the test). For those

45

---

acquisitions and other transactions
that do not qualify under the aforementioned pro forma accretive test, we have
54,550,000 Units available for general partnership purposes during the Subordination
Period. The Subordination Period generally extends until the first day of any quarter
beginning after June 30, 2003 when certain financial tests have been satisfied. We expect
the Subordination Period to end on August 1, 2003. After the Subordination Period expires,
we may prudently issue an unlimited number of Units for general partnership purposes that
do not meet the pro forma accretive test.

If
deemed necessary, we believe that additional financing arrangements can be obtained on
reasonable terms. Furthermore, we believe that maintenance of our investment grade credit
ratings combined with a continued ready access to debt and equity capital at reasonable
rates and sufficient trade credit to operate our businesses efficiently provide a solid
foundation to meet our long and short-term liquidity and capital resource requirements.

Three months ended March 31, 2003
compared to three months ended March 31, 2002

The
following discussion highlights significant quarter-to-quarter comparisons regarding our
consolidated operating, investing and financing cash flows:

Operating
cash flows.Cash flow from operating activities was an inflow of $151.6 million during
the first quarter of 2003 compared to an outflow of $10.0 million during the first quarter
of 2002. The following table summarizes the major components of operating cash flows for
first three months of 2003 and 2002 (dollars in thousands):

|                                                                         | For the Three Months
Ended March 31,
|------------------------------------------------------------------------ | ------------------------------------
|
|Net income (loss)                                                        |                                     
|Adjustments to reconcile net income (loss) to cash flows provided by     |                                     
|(used for) operating activities before changes in operating accounts:    |                                     
|Depreciation and amortization                                            |                                     
|Equity in income of unconsolidated affiliates                            |                                     
|Distributions received from unconsolidated affiliates                    |                                     
|Changes in fair market value of financial instruments                    |                                     
|Other                                                                    |                                     
|                                                                         |                                     
|Cash flow from operating activities before changes in operating accounts |                                     
|Net effect of changes in operating accounts                              |                                     
|                                                                         |                                     
|Operating activities cash flows                                          |                                     
|                                                                         |                                     

As
shown in the table above, cash flow before changes in operating accounts was an inflow of
$101.1 million during the first quarter of 2003 versus $38.2 million during the same
period in 2002. We believe that cash flow from operating activities before changes in
operating accounts is an important measure of our liquidity. We believe it provides an
indication of our ability to generate core cash flows from the assets and investments we
own or in which we have an interest. The $62.9 million increase in this element of our
operating cash flows is primarily due to:

| |  | earnings
from acquired businesses present in the 2003 period but not in the 2002 period
(particularly those of Mid-America and Seminole which we acquired in July 2002);
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | the
2002 period including $45.1 million of commodity hedging losses versus practically none
during the 2003 period; offset by,
| | - | ------------------------------------------------------------------------------------------------------------------------------

| |  | higher
interest costs associated with debt we incurred and issued since the first quarter of
2002 to finance acquisitions.
| | - | --------------------------------------------------------------------------------------------------------------------------

The
$21.3 million increase in depreciation and amortization is primarily due to businesses we
acquired since the first quarter of 2002. Changes in operating accounts are generally the
result of timing of cash receipts from sales and cash payments for inventory, purchases
and other expenses near the end of each period. For

46

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additional information regarding
changes in operating accounts, please see footnote 10 in our Notes to Unaudited
Consolidated Financial Statements included under Item 1 of this quarterly report.

Investing
cash flows. During the first three months of 2003, we used $73.1 million in cash for
investing activities compared to $396.5 million during the same period for 2002. We used
$28.8 million and $368.6 million for business acquisitions during the first quarter of
2003 and 2002, respectively. The 2003 period includes our acquisition of the Port Neches
Pipeline and the remaining 50% ownership interests in EPIK. The 2002 period includes our
acquisition of Diamond-Kochs Mont Belvieu NGL and petrochemical storage business and
propylene fractionation business.

Our
capital expenditures were $23.8 million during the first quarter of 2003 and $17.1 million
during the first quarter of 2002. The majority of the expenditures for the 2003 period
related to Processing segment projects whereas the expenditures for the 2002 period
centered on Pipeline segment projects. In addition, we made investments in and advances to
our unconsolidated affiliates of $20.5 million during the first quarter of 2003 compared
to $10.8 million during the first quarter of 2002. The increase is primarily due to
funding our share of the expansion projects of our Gulf of Mexico natural gas pipeline
investments.

Financing
cash flows.Our financing activities were a cash outflow of $69.7 million during the
first quarter of 2003 versus a cash inflow of $304.4 million during the first quarter of
2002. During the 2003 period, we made net payments on our debt obligations of $244.8
million with the aid of $258.2 million from our January 2003 equity offering. The 2003
period reflects our issuance of Senior Notes C ($350 million in principal amount) and
Senior Notes D ($500 million in principal amount) and the final repayment of $1.0 billion
that was outstanding under our 364-Day Term Loan. The 2002 period reflects the borrowings
under our revolving bank credit facilities primarily to fund the acquisition of
Diamond-Kochs propylene fractionation business. Cash distributions to our partners
increased to $69.2 million during the first quarter of 2003 from $47.4 million during the
first quarter of 2002 primarily due to increases in both the declared quarterly
distribution rates and the number of Units eligible for distributions.

47

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Our debt obligations

Our
debt obligations consisted of the following at the dates indicated:

|                                                         | March 31,
2003 | December 31,
2002
|-------------------------------------------------------- | -------------- | -----------------
|Borrowings under:                                        |                |                  
|364-Day Term Loan, variable rate, due July 2003          |                |                  
|364-Day Revolving Credit facility, variable rate,        |                |                  
|due November 2004                                        |                |                  
|Multi-Year Revolving Credit facility, variable rate,     |                |                  
|due November 2005                                        |                |                  
|Senior Notes A, 8.25% fixed rate, due March 2005         |                |                  
|Seminole Notes, 6.67% fixed rate, $15 million due        |                |                  
|each December, 2002 through 2005                         |                |                  
|MBFC Loan, 8.70% fixed rate, due March 2010              |                |                  
|Senior Notes B, 7.50% fixed rate, due February 2011      |                |                  
|Senior Notes C, 6.375% fixed rate, due February 2013     |                |                  
|Senior Notes D, 6.875% fixed rate, due March 2033        |                |                  
|                                                         |               
|Total principal amount                                   |                |                  
|Unamortized balance of increase in fair value related to |                |                  
|hedging a portion of fixed-rate debt                     |                |                  
|Less unamortized discount on:                            |                |                  
|Senior Notes A                                           |                |                  
|Senior Notes B                                           |                |                  
|Senior Notes D                                           |                |                  
|Less current maturities of debt                          |                |                  
|                                                         |               
|Long-term debt                                           |                |                  
|                                                         |               

Letters
of credit. At March 31, 2003 and December 31, 2002, we had $75 million of standby
letter of credit capacity under our Multi-Year Revolving Credit facility. We had $25.7
million of letters of credit outstanding under this facility at March 31, 2003 and $2.4
million outstanding at December 31, 2002.

Parent-Subsidiary
guarantor relationships.We act as guarantor of certain debt obligations of our
subsidiaries including, all of our Operating Partnerships consolidated debt
obligations, with the exception of the Seminole Notes. The Seminole Notes are unsecured
obligations of Seminole Pipeline Company (of which we own an effective 78.4% of its
ownership interests). If the Operating Partnership were to default on any guaranteed debt
obligation, we would be responsible for full payment of that obligation.

New
debt obligations issued during first quarter of 2003

During
the first quarter of 2003, we completed the issuance of $850 million of private placement
debt (Senior Notes C and D). Senior Notes C and D are unsecured obligations of our
Operating Partnership and rank equally with its existing and future unsecured and
unsubordinated indebtedness and senior to any future subordinated indebtedness. We
guarantee both Senior Notes C and D for our subsidiary through an unsecured and
unsubordinated guarantee that is non-recourse to the General Partner. These notes were
issued under an indenture containing certain covenants and are subject to a make-whole
redemption right. These covenants restrict our ability, with certain exceptions, to incur
debt secured by liens and engage in sale and leaseback transactions.

Senior
Notes C. In January 2003, we issued $350 million in principal amount of 6.375%
fixed-rate Senior Notes C due February 1, 2013 (Senior Notes C), from which we
received net proceeds before offering expenses of approximately $347.7 million. These
notes were sold at face value with no discount or premium. We used the proceeds from this
offering to repay a portion of the indebtedness outstanding under the 364-Day Term Loan
that we

48

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incurred to finance the Mid-America
and Seminole acquisitions. In April 2003, we initiated an offer to exchange the private
placement Senior Notes C for publicly-registered Senior Notes C.

Senior
Notes D. In February 2003, we issued $500 million in principal amount of 6.875%
fixed-rate Senior Notes due March 1, 2033 (Senior Notes D), from which we
received net proceeds before offering expenses of approximately $489.8 million. These
notes were sold at a discount of 98.842% of their face amount. We used $421.4 million from
this offering to repay the remaining principal balance outstanding under the 364-Day Term
Loan. In addition, we applied $60.0 million of the proceeds to reduce the balance
outstanding under the 364-Day Revolving Credit facility. The remaining proceeds were used
for working capital purposes.

Repayment
of 364-Day Term Loan

Our
Operating Partnership entered into a $1.2 billion senior unsecured 364-day term loan to
initially fund the acquisition of indirect interests in Mid-America and Seminole in July
2002. We used $178.5 million of the $182.5 million in proceeds from our October 2002
equity offering to partially repay this loan. We used $252.8 million of the $258.2 million
in proceeds from the January 2003 equity offering, $347.0 million of the
$347.7 million in proceeds from our issuance of Senior Notes C and $421.4 million in
proceeds from our issuance of Senior Notes D to completely repay the 364-Day Term Loan by
February 2003.

Covenants

We
were in compliance with the various covenants of our debt agreements at March 31, 2003 and
December 31, 2002.

Credit ratings

Our
current investment grade credit ratings are Baa2 by Moodys Investor Service and BBB
by Standard and Poors. Upon our acquisitions of the Mid-America and Seminole pipelines,
both agencies maintained our ratings; however, each placed us on negative outlook pending
the issuance of an appropriate amount of equity to repay the debt we incurred to fund
these acquisitions. The agencies have responded positively to our recent equity and debt
offerings. We believe that the maintenance of an investment grade credit rating is
important in managing our liquidity and capital resource requirements. We maintain regular
communications with these ratings agencies which independently judge our creditworthiness
based on a variety of quantitative and qualitative factors.

Capital spending

At
March 31, 2003, we had $11.1 million in estimated outstanding purchase commitments
attributable to capital projects. Of this amount, $7.8 million is related to the
construction of assets that will be recorded as property, plant and equipment and $3.3
million is associated with our share of capital projects of our unconsolidated affiliates
which will be recorded as additional investments in unconsolidated affiliates.

During
the remainder of 2003, we expect capital spending on internal growth projects to
approximate $105.9 million, of which $44.5 million is forecasted for various projects
within our Pipelines segment; $35.7 million for the expansion of our Norco NGL
fractionator and $13.3 million for the expansion of our Neptune gas processing facility.
Our unconsolidated affiliates forecast a combined $35.1 million in capital expenditures
during the remainder of 2003, the majority of which relate to expansion projects on our
Gulf of Mexico natural gas pipeline systems. Our share of these forecasted capital
expenditures is estimated at $15.1 million.

EPCO
subleases to us all of the equipment it holds pursuant to operating leases relating to an
isomerization unit, a deisobutanizer tower, two cogeneration units and approximately 100
railcars for one dollar per year and has assigned to us its purchase option under such
leases (the retained leases). EPCO remains liable for the lease payments
associated with these items. We have notified the original lessor of the isomerization
unit of our intent to exercise the purchase option assigned to us. The purchase price of
this equipment is expected to be up to $23.1 million and be payable in 2004.

49

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# Material contractual
obligations

With
regards to our material contractual obligations, there have been no significant changes
outside of the ordinary course of our business since December 31, 2002 except for the
following:

| |  | In February 2003, we completely repaid the $1.0 billion principal balance that was
outstanding under the 364-Day Term Loan at December 31, 2002 using proceeds from the debt
and equity offerings we completed during the first quarter of 2003 (which include our
Senior Notes C and D discussed below).
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | We
issued our $350 million in principal amount Senior Notes C in January 2003. These notes
mature in 2013.
| | - | ----------------------------------------------------------------------------------------------------------

| |  | We
issued our $500 million in principal amount Senior Notes D in February 2003. These notes
mature in 2033.
| | - | -----------------------------------------------------------------------------------------------------------

| |  | Our
letters of credit increased from $2.4 million at December 31, 2002 to $25.7 million at
March 31, 2003. The increase is attributable to letter of credit requirements related to
our import of NGL cargoes during the period.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The
following table summarizes our updated material contractual obligations related to our
debt obligations:

|Contractual Obligations       | Total | 2003 | 2004
through
2005 | 2006
through
2007 | After
2007
|----------------------------- | ----- | ---- | ----------------- | ----------------- | ----------
|Principal payments to be made |       |      |                   |                   |           
|under debt obligations        |       |      | $                 | 2,006,000         |           
|Potential payments due under  |       |     
|letter of credit agreements   |       |      | $                 | 25,695            |           

# Related party
transactions

Relationship with EPCO
and Its Affiliates

We
have an extensive and ongoing relationship with EPCO and its affiliates. EPCO is
controlled by Dan L. Duncan, Chairman and a director (and Chairman of the Board of
Directors) of the General Partner. In addition, three other members of the Board of
Directors (O.S. Andras, Randa D. Williams and Richard H. Bachmann) and the remaining
executive and other officers of the General Partner are employees of EPCO. The principal
business activity of our General Partner is to act as our managing partner. Collectively,
EPCO and its affiliates owned 57.4% of our limited partnership interests and 70.0% of our
General Partner at March 31, 2003.

We
have no employees. All of our management, administrative and operating functions are
performed by employees of EPCO. We reimburse EPCO for the costs of its employees who
perform operating functions for us. In addition, we reimburse EPCO for the costs of
certain of employees who manage our business and affairs.

EPCO
is also the operator of certain facilities we own or have an equity interest in. We have
also entered into an agreement with EPCO to provide trucking services to us for the
loading and transportation of products. Lastly, in the normal course of business, we buy
from and sell NGL products to EPCOs Canadian affiliate.

The
following table shows our related party revenues and operating expenses attributable to
EPCO for the periods indicated:

|                                             | For the Three Months
Ended March 31,
|-------------------------------------------- | ------------------------------------
|
|Revenues from consolidated operations        |                                     
|Operating costs and expenses                 |                                     
|Selling, general and administrative expenses |                                     

50

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Relationship
with Shell

We
have a commercial relationship with Shell as a partner, customer and vendor. At March 31,
2003, Shell owned approximately 20.1% of our limited partnership interests and 30.0% of
our General Partner. Currently, three members of the Board of Directors of the General
Partner (J.A. Berget, J.R. Eagan and A.Y. Noojin, III) are employees of Shell.

Shell
and its affiliates are the Companys single largest customer. During the three months
ended March 31, 2003 and 2002, they accounted for 5.5% and 8.7%, respectively, of our
consolidated revenues. Our revenues from Shell reflect the sale of NGL and petrochemical
products to them and the fees we charge them for pipeline transportation and NGL
fractionation services. Our operating costs and expenses with Shell primarily reflect the
payment of energy-related expenses related to the Shell natural gas processing agreement
and the purchase of NGL products from them.

The
most significant contract affecting our natural gas processing business is the 20-year,
keepwhole Shell processing agreement, which grants us the right to process Shells
current and future production from state and federal waters of the Gulf of Mexico. The
Shell processing agreement includes a life of lease dedication, which may extend the
agreement well beyond 20 years. This contract was amended effective March 1, 2003.
Generally, the amended contract has the following rights and obligations:

| |  | the
exclusive right, but not the obligation in all cases, to process substantially all of
Shell's Gulf of Mexico natural gas production; plus
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------

| |  | the exclusive right,
but not the obligation in all cases, to process all natural gas production from leases
dedicated by Shell for the life of such leases; plus
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | the right to all title, interest and ownership in the mixed NGL stream extracted by our
gas processing plants from Shells natural gas production from such leases; with
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | the obligation to re-deliver to Shell the natural gas stream after the mixed NGL stream is
extracted.
| | - | -----------------------------------------------------------------------------------------------------

In
our natural gas processing activities under this contract, we reimburse Shell for the
energy value of (i) the NGLs we extract and (ii) the natural gas we consume as fuel. This
energy value is referred to as plant thermal reduction (PTR) and is based on
the Btu content of the natural gas taken out of the stream. The amended contract contains
a mechanism (termed Consideration Adjustment Outside of Normal Operations or
CAONO) to adjust the value of the PTR we reimburse to Shell. The CAONO, in
effect, protects us from processing at an economic loss when the value of the NGLs we
extract is less than the sum of the cost of the PTR reimbursement, operating costs of the
gas processing facility and other costs such as NGL fractionation and pipeline fees.

In
general, the CAONO adjustment requires the comparison of our average net gas processing
margin to an upper and lower limit (all as defined within the agreement). If our average
net processing margin is below the lower limit, the PTR reimbursement payable to Shell is
decreased by the product of the absolute value of the difference between our average net
processing margin and the specified lower limit multiplied by the volume of NGLs
extracted. To the extent our average net processing margin is higher than the upper limit
(the probability of which we believe is low), the PTR reimbursement payable to Shell is
increased by the product of the difference between the average net gas processing margin
and the specified upper limit multiplied by the volume of NGLs extracted.

The
underlying purpose of the CAONO mechanism is to provide Shell with relative assurance that
its gas will continue to be processed during periods when natural gas prices are high
relative to NGL prices (times when we would choose not to process) while continuing to
protect us from processing Shells gas at an economic loss.

51

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The
following table shows our related party revenues and operating expenses attributable to
Shell for the periods indicated:

|                                      | For the Three Months
Ended March 31,
|------------------------------------- | ------------------------------------
|
|Revenues from consolidated operations |                                     
|Operating costs and expenses          |                                     

Shell
is also a partner with us in the Gulf of Mexico natural gas pipelines we acquired from El
Paso in 2001. We also lease from Shell its 45.4% interest in our Splitter I propylene
fractionation facility.

# Recent accounting
developments

The
following recently issued accounting standards have been adopted and implemented by us:

| |  | SFAS
No. 143, "Accounting for Asset Retirement Obligations";
| | - | ------------------------------------------------------------

| |  | SFAS
No. 146, "Accounting for Costs Associated with Exit and Disposal Activities";
| | - | ----------------------------------------------------------------------------------

| |  | SFAS
No. 148, "Accounting for Stock-Based Compensation - Transition and Disclosure";
and,
| | - | -----------------------------------------------------------------------------------------

| |  | FIN
No. 45, "Guarantor's Accounting and Disclosure Requirement from Guarantees, Including
Indirect Guarantees of Indebtedness of Others.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------

We
are currently evaluating the provisions of FIN No. 46, Consolidation of Variable
Interest Entities.

SFAS
No. 143. We adopted this standard as of January 1, 2003. This statement establishes
accounting standards for the recognition and measurement of a liability for an asset
retirement obligation (ARO) and the associated asset retirement cost. Under
the provisions of this standard, we reviewed our long-lived assets for ARO liabilities and
identified such liabilities in several operational areas. These include ARO liabilities
related to (i) easements over property not currently owned by us and (ii) statutory
regulatory requirements for abandonment or retirement of certain currently operated
facilities.

As
a result of our analysis of the identified AROs, we were not required to recognize such
potential liabilities. Our rights to the easements are renewable and only require
retirement action upon nonrenewal of the easement agreements. We currently plan to renew
all such easement agreements and use these properties indefinitely. Therefore, the ARO
liability is not estimable for such easements. If we decide not to renew these agreements,
an ARO liability would be recorded at that time. ARO liabilities related to statutory
regulatory requirements for abandonment or retirement of certain currently operated
facilities were also identified. We currently have no intention or legal obligation to
abandon or retire such facilities. An ARO liability would be recorded if future
abandonment or retirement occurred. Certain Gulf of Mexico natural gas pipelines, in which
we have an equity interest, have identified AROs relating to regulatory
requirements. There is no current intention to abandon or retire these pipelines. If these
pipelines were abandoned or retired, an ARO liability would then be disclosed.

SFAS
No. 146. We adopted this standard as of January 1, 2003. This statement requires
companies to recognize costs associated with exit or disposal activities when they are
incurred rather than at the date of a commitment to exit or disposal plan. We determined
that this standard had no material impact on our financial statements.

SFAS
No. 148. We adopted this standard as of December 31, 2002. This statement provides
alternative methods of transition from a voluntary change to the fair value based method
of accounting for stock-based employee compensation. In addition, SFAS No. 148 amends the
disclosure requirements of SFAS No. 123 in both annual and interim financial statements.
We have provided the information required by this statement under footnote 14 of the Notes
to Unaudited Consolidated Financial Statements included elsewhere in this quarterly
report.

52

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SFAS
No. 149. On April 30, 2003, the FASB issued SFAS No. 149, Amendment of Statement 133
on Derivative Instruments and Hedging Activities. This statement amends and
clarifies accounting for derivative instruments, including certain derivative instruments
embedded in other contracts, and for hedging activities under SFAS No. 133. This statement
is effective for contracts entered into or modified after June 20, 2003, for hedging
relationships designated after June 30, 2003, and to certain preexisting contracts. We
will adopt SFAS No. 149 on a prospective basis at its effective date on July 1, 2003. We
are currently evaluating the impact that SFAS No. 149 will have on our financial
statements.

FIN
45. We implemented this FASB interpretation as of December 31, 2002. This
interpretation of SFAS No. 5, 57 and 107, and rescission of FASB Interpretation No. 34
elaborates on the disclosures to be made by a guarantor in its interim and annual
financial statements about its obligations under certain guarantees that it has issued. It
also clarifies that a guarantor is required to recognize, at the inception of a guarantee,
a liability for the fair value of the obligation undertaken in issuing the guarantee. We
have provided the information required by this interpretation under footnote 8 of the
Notes to Unaudited Consolidated Financial Statements included elsewhere in this quarterly
report.

FIN
46. In January 2003, FIN 46, an interpretation of ARB No. 51, Consolidated
Financial Statements, was issued to address perceived weaknesses in accounting for
entities commonly known as special-purpose or off-balance-sheet entities, but the guidance
applies to a larger population of entities. FIN 46 provides guidance for identifying the
party with a controlling financial interest resulting from arrangements or financial
interests rather than from voting interests. FIN 46 defines the term variable
interest entity (or VIE) and is based on the premise that if a business
enterprise has a controlling financial interest in a VIE, the assets, liabilities, and
results of the activities of the VIE should be included in the consolidated financial
statements of the business enterprise. FIN 46 applies immediately to VIEs created after
January 31, 2003 and to VIEs in which an enterprise obtains an interest after that date.
For variable interests in VIEs created before February 1, 2003, FIN 46 applies to public
enterprises no later than the beginning of the first interim or annual period beginning
after June 15, 2003. This FIN may be applied prospectively with the cumulative-effect
adjustment as of the date on which it is first applied or by restating previously issued
financial statements for one or more years with the cumulative-effect adjustment as of the
beginning of the first year restated. We are currently studying the provisions of
FIN 46. Based upon our initial interpretation of FIN 46, we do not believe that this
guidance will have a material effect on our financial statements.

# Our critical accounting
policies

In
our financial reporting process, we employ methods, estimates and assumptions that affect
the reported amounts of assets and liabilities and disclosure of contingent assets and
liabilities as of the date of the financial statements. These methods, estimates and
assumptions also affect the reported amounts of revenues and expenses during the reporting
period. Investors should be aware that actual results could differ from these estimates if
the underlying assumptions prove to be incorrect.

There
have been no significant changes in our critical accounting policies since December 31,
2002. For a detailed discussion of these policies, please see the section titled
Our critical accounting policies under Item 7 of our annual report on
Form 10-K for 2002. The following is a condensed discussion of our critical accounting
policies and the estimates and assumptions underlying them.

Depreciation
methods and estimated useful lives of property, plant and equipment

In
general, depreciation is the systematic and rational allocation of an assets cost,
less its residual value (if any), to the periods it benefits. We use the straight-line
method to depreciate our property, plant and equipment. Our estimate of an assets
useful life is based on a number of assumptions including technological changes that may
affect the assets usefulness and the manner in which we intend to physically use the
asset. If we subsequently change our assumptions regarding these factors, it would result
in an increase or decrease in depreciation expense. Additionally, if we determine that an
assets undepreciated cost may not be recoverable due to impairment, this would
result in a charge against earnings.

53

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At
March 31, 2003 and December 31, 2002, the net book value of our property, plant and
equipment was $2.8 billion. See footnote 5 of the Notes to Unaudited Consolidated
Financial Statements for additional information regarding our property, plant and
equipment.

Amortization
methods and estimated useful lives of qualifying intangible assets

Our
recorded intangible assets primarily consist of the estimated value assigned to certain
contract-based assets representing the rights we own arising from contractual agreements.
A contract-based intangible asset with a finite useful life is amortized over its
estimated useful life. Our estimate of useful life is based on a number of factors
including the expected useful life of related assets (i.e., fractionation facility,
pipeline, etc.) and the effects of obsolescence, demand, competition and other factors. If
our underlying assumptions regarding the useful life of an intangible asset change, we
then might need to adjust the amortization period of such asset which would increase or
decrease amortization expense. Additionally, if we determine that an intangible
assets unamortized cost may not be recoverable due to impairment, this would result
in a charge against earnings.

At
March 31, 2003 and December 31, 2002, the net book value of our intangible assets was
$274.1 million and $277.7 million. See footnote 7 of the Notes to Unaudited Consolidated
Financial Statements for additional information regarding our intangible assets.

Methods
we employ to measure the fair value of goodwill

Our
goodwill is attributable to the excess of the purchase price over the fair value of assets
acquired. Goodwill is not amortized. Instead, goodwill is tested for impairment at a
reporting unit level annually, and more frequently, if circumstances warrant. This testing
involves calculating the fair value of a reporting unit, which in turn is based on our
assumptions regarding the future economic prospects of the reporting unit. If the fair
value of the reporting unit (including related goodwill) is less than its book value, a
charge to earnings would be required to reduce the carrying value of goodwill to its
implied fair value. If our underlying assumptions regarding the future economic prospects
of a reporting unit change, this could impact the fair value of the reporting unit and
result in a charge to earnings to reduce the carrying value of goodwill.

At
March 31, 2003 and December 31, 2002, the carrying value of our goodwill was $81.5
million. See footnote 7 of the Notes to Unaudited Consolidated Financial Statements for
additional information regarding our goodwill.

Our
revenue recognition polices

In
general, we recognize revenue from our customers when all of the following criteria are
met: (i) firm contracts are in place, (ii) delivery has occurred or services have been
rendered, (iii) pricing is fixed and determinable and (iv) collectibility is reasonably
assured. When contracts settle (i.e., either physical delivery of product has taken place
or the services designated in the contract have been performed), we determine if an
allowance is necessary and record it accordingly. The revenues that we record are not
materially based on estimates. We believe the assumptions underlying any revenue estimates
that we use will not prove to be significantly different from actual amounts due to the
routine nature of these estimates and the stability of our operations.

Mark-to-market
accounting for certain financial instruments

Our
earnings are also affected by use of the mark-to-market method of accounting required
under GAAP for certain financial instruments. We use short-term, highly liquid financial
instruments such as swaps, forwards and other contracts to manage price risks associated
with inventories, firm commitments and certain anticipated transactions, primarily within
our Processing segment. The use of mark-to-market accounting for financial instruments may
cause our non-cash earnings to fluctuate based upon changes in underlying indexes,
primarily commodity prices. Fair value for the financial instruments we employ is
determined using price data from highly liquid markets such as the NYMEX commodity
exchange.

During
the first three months of 2002, we recognized a loss of $45.1 million from our commodity
hedging activities. Of this loss, $28.7 million was attributable to the change in fair
value of the portfolio between December

54

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31, 2001 and March 31, 2002. The fair
value of open positions at March 31, 2002 was a payable of $23.1 million. In March 2002,
the effectiveness of our primary commodity hedging strategy deteriorated due to an
unexpected rapid increase in natural gas prices whereby the loss in value of our
fixed-price natural gas financial instruments was not offset by increased gas processing
margins. We exited the strategy underlying this loss.

During
the first three months of 2003, we entered into a limited number of commodity financial
instruments from which we recorded a loss of $0.9 million. The fair value of open
positions at March 31, 2003 was a receivable of approximately $2 thousand. See footnote 11 of
the Notes to Unaudited Consolidated Financial Statements for additional information
regarding our financial instruments.

# Other items

Uncertainties
regarding our investment in BEF

In
recent years, MTBE has been detected in municipal and private water supplies resulting in
various legal actions. BEF has not been named in any MTBE legal action to date. In light
of these developments, we and the other two partners of BEF are formulating a plan for the
BEF facility if MTBE is banned. We are evaluating a possible conversion of the facility
from MTBE production to alkylate production. The carrying value of our investment in BEF
was $50.9 million at March 31, 2003.

Conversion
of EPCO Subordinated Units to Common Units

On
May 1, 2003, 10,704,936 of EPCOs Subordinated Units converted to Common Units as a
result of the Company satisfying certain financial tests. The remaining 21,409,872
Subordinated Units are anticipated to convert to Common Units on August 1, 2003. These
conversions will have no impact upon our earnings per unit or distributions since
Subordinated Units are already included in both the basic and fully-diluted earnings per
unit calculations and are distribution-bearing.

55

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# Cautionary Statement
regarding Forward-Looking Information and Risk Factors

This
quarterly report contains various forward-looking statements and information that are
based on our beliefs and those of our general partner, as well as assumptions made by us
and information currently available to us. When used in this document, words such as
anticipate, project, expect, plan,
goal, forecast, intend, could,
believe, may and similar expressions and statements regarding our
plans and objectives for future operations, are intended to identify forward-looking
statements. Although we and our general partner believe that such expectations reflected
in such forward-looking statements are reasonable, neither we nor our general partner can
give any assurances that such expectations will prove to be correct. Such statements are
subject to a variety of risks, uncertainties and assumptions. If one or more of these
risks or uncertainties materialize, or if underlying assumptions prove incorrect, our
actual results may vary materially from those anticipated, estimated, projected or
expected. You should not put undue reliance on any forward-looking statements. When
considering forward-looking statements, please review our Risk Factors
below.

Risk Factors

Among
the key risk factors that may have a direct impact on our results of operations and
financial condition are:

| |  | A decrease in the difference between NGL product prices and natural gas prices results in
lower margins on volumes processed, which would adversely affect our profitability.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | A reduction in demand for our products by the petrochemical, refining or heating
industries could adversely affect our results of operations.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------

| |  | A
decline in the volume of NGLs delivered to our facilities could adversely affect our
results of operations.
| | - | -------------------------------------------------------------------------------------------------------------

| |  | Our
business requires extensive credit risk management that may not be adequate to protect
against customer nonpayment.
| | - | -----------------------------------------------------------------------------------------------------------------------

| |  | Acquisitions
and expansions may affect our business by substantially increasing the level of our
indebtedness and contingent liabilities and increasing our risks of being unable to effectively integrate these new
operations.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | Our
tax treatment depends on our status as a partnership for federal income tax purposes, as
well as our not being subject to entity-level taxation by states. If the IRS treats us as
a corporation or we become subject to entity-level taxation for state tax purposes, it
would substantially reduce distributions to our Unitholders and our ability to make
payments on our debt securities.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | We
have leverage that may restrict our future financial and operating flexibility.
| | - | ----------------------------------------------------------------------------------

| |  | Terrorist
attacks aimed at our facilities could adversely affect our business.
| | - | ------------------------------------------------------------------------------

56

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# Item 3.   QUANTITATIVE
AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

We
are exposed to financial market risks, including changes in commodity prices and interest
rates. We may use financial instruments (i.e., futures, forwards, swaps, options, and
other financial instruments with similar characteristics) to mitigate the risks of certain
identifiable and anticipated transactions, primarily within our Processing segment. In
general, the types of risks we attempt to hedge are those relating to the variability of
future earnings and cash flows caused by changes in commodity prices and interest rates.
As a matter of policy, we do not use financial instruments for speculative (or trading)
purposes.

There
has been no material change in our commodity financial instruments portfolio since
December 31, 2002. During the first quarter of 2003, we settled all interest rate-related
financial instruments that were outstanding at December 31, 2002 (see the following
discussion titled Interest rate-related financial instruments
portfolio). For additional information regarding our financial instruments, see
footnote 11 of our Notes to Unaudited Consolidated Financial Statements.

Commodity
financial instruments portfolio

At
December 31, 2002, the net fair value of this portfolio was a payable of $26 thousand,
based entirely upon quoted market prices. At March 31, 2003, the net fair value of this
portfolio was a receivable $2 thousand. We continue to have only a limited number of
commodity financial instruments outstanding.

During
the first three months of 2002, we recognized a loss of $45.1 million from our Processing
segments commodity hedging activities that was recorded as an operating cost in our
Statements of Consolidated Operations. In March 2002, the effectiveness of our primary
commodity hedging strategy at the time deteriorated due to an unexpected rapid increase in
natural gas prices whereby the loss in value of our fixed-price natural gas financial
instruments was not offset by increased gas processing margins. We exited the strategy
underlying this loss in 2002.

During
the first three months of 2003, we recorded a loss of $0.9 million from our commodity
hedging activities, of which $0.1 million is attributable to the Processing segment and
the remainder to Pipelines.

Interest
rate-related financial instruments portfolio

Interest
rate swap agreements. At December 31, 2002, we had one interest rate swap outstanding
having a notional amount of $54 million and a fair value at that date of $1.6 million. The
counterparty elected to exercise its option to terminate this swap as of March 1, 2003 and
we received $1.6 million associated with the final settlement of this swap on that date.
The early termination of the swap had no impact on our earnings. At March 31, 2003, we
have no interest rate swap agreements outstanding.

Treasury
Locks. During the fourth quarter of 2002, we entered into seven treasury lock
transactions, each with an original maturity of either January 31, 2003 or April 15, 2003.
A treasury lock is a specialized agreement that fixes the price (or yield) on a specific
U.S. treasury security for an established period of time. The purpose of these
transactions was to hedge the underlying treasury interest rate associated with our
anticipated issuance of debt in early 2003 to partially refinance the Mid-America and
Seminole acquisitions. Our treasury lock transactions are accounted for as cash flow
hedges under SFAS No. 133. The notional amounts of these transactions totaled $550
million, with a total treasury lock rate of approximately 4%.

We
elected to settle all of the treasury locks during the first quarter of 2003 in connection
with our issuance of Senior Notes C and D (see Managements Discussion and
Analysis of Financial Condition and Results of OperationsOur liquidity and capital
resourcesOur debt obligations under Item 2 of this quarterly report). The
settlement of the treasury locks resulted in our receipt of $5.4 million of cash.

The
fair value of these instruments at December 31, 2002 was a current liability of $3.8
million offset by a current asset of $0.2 million. The net $3.6 million net liability was
recorded as a component of comprehensive income on that date, with no impact to current
earnings. With the settlement of the treasury locks, the $3.6 million net liability was
reclassified out of accumulated other comprehensive income in Partners Equity to
offset the

57

---

current asset and liabilities we
recorded at December 31, 2002, with no impact to earnings. For additional information
regarding our treasury lock transactions, see our footnote 11 of our Notes to Unaudited
Consolidated Financial Statements.

# Item 4.   CONTROLS AND
PROCEDURES

In
the 90-day period before the filing of this quarterly report, the CEO and CFO of the
General Partner of Enterprise Products Partners L.P. and Enterprise Products Operating
L.P. (collectively the registrants) have evaluated the effectiveness of the
registrants disclosure controls and procedures. These disclosure controls and
procedures are those controls and other procedures we maintain, which are designed to
insure that all of the information required to be disclosed by the registrants in all of
their combined and separate periodic reports filed with the SEC is recorded, processed,
summarized and reported, within the time periods specified in the SECs rules and
forms. Disclosure controls and procedures include, without limitation, controls and
procedures designed to ensure that information required to be disclosed by the registrants
in their reports filed or submitted under the Securities Exchange Act of 1934 is
accumulated and communicated to our management, including the CEO and CFO of the General
Partner, as appropriate to allow those persons to make timely decisions regarding required
disclosure.

Subsequent
to the date when the disclosure controls and procedures were evaluated, there have not
been any significant changes in the registrants controls or procedures or in other
factors that could significantly affect such controls or procedures. No significant
deficiencies or material weaknesses were detected, so no corrective actions needed to be
taken.

58

---

# PART II. OTHER
INFORMATION.

# Item 6.   EXHIBITS AND
REPORTS ON FORM 8-K.

(a)(1) and (2) Financial
Statements and Financial Statement Schedules.

See Index to Financial
Statements set forth on page F-1.

(a)(3) Exhibits.

|Exhibit No. |    | Exhibit*                                                                                                                                                                                                                                                                                                                                                                                                       
|----------- | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|2.1         | -- | Purchase and Sale Agreement between Coral Energy, LLC and Enterprise Products Operating L.P.
                    dated September 22, 2000 (incorporated by reference to Exhibit 10.1 to Form 8-K filed September
                    26, 2000).                                                                                                                                                                
|2.2         | -- | Purchase and Sale Agreement dated January 16, 2002 by and between Diamond-Koch, L.P. and
                    Diamond-Koch III, L.P. and Enterprise Products Texas Operating L.P. (incorporated by reference to
                    Exhibit 10.1 to Form 8-K filed February 8, 2002.)                                                                                                                           
|2.3         | -- | Purchase and Sale Agreement dated January 31, 2002 by and between D-K Diamond-Koch, L.L.C.,
                    Diamond-Koch, L.P. and Diamond-Koch III, L.P. as Sellers and Enterprise Products Operating L.P.
                    as Buyer (incorporated by reference to Exhibit 10.2 to Form 8-K filed February 8, 2002).                                                                                   
|2.4         | -- | Purchase Agreement by and between E-Birchtree, LLC and Enterprise Products Operating L.P. dated
                    July 31, 2002 (incorporated by reference to Exhibit 2.2 to Form 8-K filed August 12, 2002).                                                                                                                                                                                                
|2.5         | -- | Purchase Agreement by and between E-Birchtree, LLC and E-Cypress, LLC dated July 31, 2002
                    (incorporated by reference to Exhibit 2.1 to Form 8-K filed August 12, 2002).                                                                                                                                                                                                                    
|3.1         | -- | First Amended and Restated Limited Liability Company Agreement of Enterprise Products GP, LLC
                    dated as of September 17, 1999 (incorporated by reference to Exhibit 99.8 to the Form 8-K/A-l
                    filed October 27, 1999).                                                                                                                                                   
|3.2         | -- | Amendment No. 1 to the First Amended and Restated Limited Liability Company Agreement of the
                    General Partner dated as of September 19, 2002 (incorporated by reference to Exhibit 3.2 to Form
                    10-K filed March 31, 2003).                                                                                                                                              
|3.3         | -- | Third Amended and Restated Agreement of Limited Partnership of Enterprise Products Partners L.P.
                    dated May 15, 2002 (incorporated by reference to Exhibit 3.3 to Form 10-Q filed August 13, 2002).                                                                                                                                                                                         
|3.4         | -- | Amendment No. 1 to Third Amended and Restated Agreement of Limited Partnership of Enterprise
                    Products Partners L.P. dated August 7, 2002 (incorporated by reference to Exhibit 3.3 to Form
                    10-Q filed August 13, 2002).                                                                                                                                                
|3.5         | -- | Amendment No. 2 to Third Amended and Restated Agreement of Limited Partnership of Enterprise
                    Products Partners L.P. dated December 17, 2002 (incorporated by reference to Exhibit 3.5 to Form
                    8-K filed December 17, 2002).                                                                                                                                            
|3.6         | -- | Amended and Restated Agreement of Limited Partnership of Enterprise Products Operating L.P. dated
                    as of July 31, 1998 (incorporated by reference to Exhibit 3.2 to Registration Statement on Form
                    S-1/A filed July 21, 1998).                                                                                                                                          
|4.1         | -- | Indenture dated as of March 15, 2000, among Enterprise Products Operating L.P., as Issuer,
                    Enterprise Products Partners L.P., as Guarantor, and First Union National Bank, as Trustee
                    (incorporated by reference to Exhibit 4.1 to Form 8-K filed March 10, 2000).                                                                                                     
|4.2         | -- | First Supplemental Indenture dated as of January 22, 2003, among Enterprise Products Operating
                    L.P., as Issuer, Enterprise Products Partners L.P., as Guarantor, and Wachovia Bank, National
                    Association, as Trustee (incorporated by reference to Exhibit 4.2 to Registration Statement on
                    Form S-4, Reg. No. 333-102776, filed January 28, 2003).
|4.3         | -- | Global Note representing $350 million principal amount of 6.375% Series A Senior Notes due 2013
                    with attached Guarantee (incorporated by reference to Exhibit 4.3 to Registration Statement on
                    Form S-4, Reg. No. 333-102776, filed January 28, 2003).                                                                                                                 

59

---

|4.4  | -- | Global Note representing $350 million principal amount of 6.375% Series B Senior Notes due 2013
                    with attached Guarantee (incorporated by reference to Exhibit 4.4 to Registration Statement on
                    Form S-4, Reg. No. 333-102776, filed January 28, 2003).                                                                                                                                                                                                                                                                                                                              
|---- | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|4.5  | -- | Registration Rights Agreement dated as of January 22, 2003, among Enterprise Products Operating
                    L.P., Enterprise Products Partners L.P. and the Initial Purchasers named therein (incorporated by
                    reference to Exhibit 4.5 to Registration Statement on Form S-4, Reg. No. 333-102776, filed
                    January 28, 2003).                                                                                                                                                                                                                                                 
|4.6  | -- | Second Supplemental Indenture dated as of  February 14, 2003, among Enterprise Products Operating
                    L.P., as Issuer, Enterprise Products Partners L.P., as Guarantor, and Wachovia Bank, National
                    Association, as Trustee (incorporated by reference to Exhibit 4.3 to Form 10-K filed March 31,
                    2003).                                                                                                                                                                                                                                                           
|4.7  | -- | Rule 144 A Global Note representing $499.2 million principal amount of 6.875% Series A Senior
                    Notes due 2033 with attached Guarantee (incorporated by reference to Exhibit 4.5 to Form 10-K
                    filed March 31, 2003).                                                                                                                                                                                                                                                                                                                                                                  
|4.8  | -- | Regulation S Global Note representing $800,000 principal amount of 6.875% Series A Senior Notes
                    due 2033 with attached Guarantee (incorporated by reference to Exhibit 4.6 to Form 10-K filed
                    March 31, 2003).                                                                                                                                                                                                                                                                                                                                                                      
|4.9  | -- | Form of Global Note representing $500 million principal amount of 6.875% Series B Senior Notes
                    due 2033 with attached Guarantee (incorporated by reference to Exhibit 4.8 to Form 10-K filed
                    March 31, 2003).                                                                                                                                                                                                                                                                                                                                                                       
|4.10 | -- | Registration Rights Agreement dated as of February 14, 2003, among Enterprise Products Operating
                    L.P., Enterprise Products Partners L.P. and the Initial Purchasers named therein (incorporated by
                    reference to Exhibit 4.10 to Form 10-K filed March 31, 2003).                                                                                                                                                                                                                                                                                                                    
|4.11 | -- | Global Note representing $350 million principal amount of 8.25% Senior Notes due 2005
                    (incorporated by reference to Exhibit 4.2 to Form 8-K filed March 10, 2000).                                                                                                                                                                                                                                                                                                                                                                                                                                      
|4.12 | -- | Global Note representing $450 million principal amount of 7.50% Senior Notes due 2011
                    (incorporated by reference to Exhibit 4.1 to Form 8-K filed January 25, 2001).                                                                                                                                                                                                                                                                                                                                                                                                                                    
|4.13 | -- | Form of Common Unit certificate (incorporated by reference to Exhibit 4.1 to Registration
                    Statement on Form S-1/A; File No. 333-52537, filed July 21, 1998).                                                                                                                                                                                                                                                                                                                                                                                                                                            
|4.14 | -- | $250 Million Multi-Year Revolving Credit Facility dated as of November 17, 2000, among Enterprise
                    Products Operating L.P., First Union National Bank, as Administrative Agent, Bank One, NA, as
                    Documentation Agent, the Chase Manhattan Bank, as Syndication Agent, and the several banks from
                    time to time parties thereto, with First Union Securities, Inc. and Chase Securities Inc. as
                    Joint Lead Arrangers and Joint Book Managers (incorporated by reference to Exhibit 4.2 to Form
                    8-K filed January 24, 2001).
|4.15 | -- | $150 Million 364-Day Revolving Credit Facility November 17, 2000, among Enterprise Products
                    Operating L.P., First Union National Bank, as Administrative Agent, Bank One, NA, as
                    Documentation Agent, the Chase Manhattan Bank, as Syndication Agent, and the several banks from
                    time to time parties thereto, with First Union Securities, Inc. and Chase Securities Inc. as
                    Joint Lead Arrangers and Joint Book Managers (incorporated by reference to Exhibit 4.3 to Form
                    8-K filed January 24, 2001).               
|4.16 | -- | Guaranty Agreement dated as of November 17, 2000, by Enterprise Products Partners L.P. in favor
                    of First Union National Bank, as Administrative Agent, with respect to the $250 Million
                    Multi-Year Revolving Credit Facility included as Exhibit 4.4 above (incorporated by reference to
                    Exhibit 4.4 to Form 8-K filed January 24, 2001).                                                                                                                                                                                                                       
|4.17 | -- | Guaranty Agreement dated as of November 17, 2000, by Enterprise Products Partners L.P. in favor
                    of First Union National Bank, as Administrative Agent, with respect to the $150 Million 364-Day
                    Revolving Credit Facility (incorporated by reference to Exhibit 4.5 to Form 8-K filed January 24,
                    2001).                                                                                                                                                                                                                                                        
|4.18 | -- | First Amendment to Multi-Year Credit Facility dated April 19, 2001 (incorporated by reference to
                    Exhibit 4.12 to Form 10-Q filed May 14, 2001).                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|4.19 | -- | Second Amendment to Multi-Year Revolving Credit Facility dated April 14, 2002 (incorporated by
                    reference to Exhibit 4.14 to Form 10-Q filed May 14, 2002).                                                                                                                                                                                                                                                                                                                                                                                                                                              
|4.20 | -- | Third Amendment to Multi-Year Revolving Credit Facility dated July 31, 2002 (incorporated by
                    reference to Exhibit 4.1 to Form 10-Q filed August 12, 2002).                                                                                                                                                                                                                                                                                                                                                                                                                                              
|4.21 | -- | Fourth Amendment to Multi-Year Revolving Credit Facility dated effective as of November 15, 2002
                    (incorporated by reference to Exhibit 4.21 to Form 10-Q filed November 13, 2002).                                                                                                                                                                                                                                                                                                                                                                                                                      
|4.22 | -- | First Amendment to 364-Day Credit Facility dated November 6, 2001, effective as of November 16,
                    2001 (incorporated by reference to Exhibit 4.13 to Form 10-Q filed August 13, 2002).                                                                                                                                                                                                                                                                                                                                                                                                                    

60

---

|4.23   | --                                                                                                                                                                                                                                                     | Second Amendment to 364-Day Revolving Credit Facility dated April 24, 2002 (incorporated by
                    reference to Exhibit 4.15 to Form 10-Q filed May 14, 2002).                                                                                                                                                                                                                                                                                                                          
|------ | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|4.24   | --                                                                                                                                                                                                                                                     | Third Amendment to 364-Day Revolving Credit Facility dated July 31, 2002 (incorporated by
                    reference to Exhibit 4.2 to Form 8-K filed August 12, 2002).                                                                                                                                                                                                                                                                                                                           
|4.25   | --                                                                                                                                                                                                                                                     | Contribution Agreement dated September 17, 1999 (incorporated by reference to Exhibit "B" to
                    Schedule 13D filed September 27, 1999 by Tejas Energy, LLC).                                                                                                                                                                                                                                                                                                                        
|4.26   | --                                                                                                                                                                                                                                                     | Registration Rights Agreement dated September 17, 1999 (incorporated by reference to Exhibit "E"
                    to Schedule 13D filed September 27, 1999 by Tejas Energy, LLC).                                                                                                                                                                                                                                                                                                                 
|4.27   | --                                                                                                                                                                                                                                                     | Unitholder Rights Agreement dated September 17, 1999 (incorporated by reference to Exhibit "C" to
                    Schedule 13D filed September 27, 1999 by Tejas Energy, LLC).                                                                                                                                                                                                                                                                                                                   
|10.1** | --                                                                                                                                                                                                                                                     | Sixth Amendment to Conveyance of Gas Processing Rights, dated as of March 1, 2003 among
                    Enterprise Gas Processing, LLC, Shell Oil Company, Shell Exploration & Production Company, Shell
                    Offshore Inc., Shell Consolidated Energy Resources Inc., Shell Land & Energy Company, Shell
                    Frontier Oil & Gas Inc. and Shell Gulf of Mexico Inc. (incorporated by reference to Exhibit 10.1
                    to Form 8-K filed May 9, 2003).
|10.2   | --                                                                                                                                                                                                                                                     | Letter agreement dated April 9, 2003, relating to Sixth Amendment to Conveyance of Gas Processing
                    Rights related to Exhibit 10.14 to this report (incorporated by reference to Exhibit 10.2 to Form
                    8-K filed May 9, 2003).                                                                                                                                                                                                                                  
|99.1#  | --                                                                                                                                                                                                                                                     | Section 1350 Certifications                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|       |                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|*      | With respect to any exhibits incorporated by reference to any Exchange Act
filings, the Commission file number for Enterprise Products Partners L.P. is 1-14323 and the Commission file number for Enterprise Products Operating L.P. is 333-93239-01.
|**     | Portions of this Exhibit have been omitted pursuant to a
request for confidential treatment.                                                                                                                                                          
|#      | Filed with this report.                                                                                                                                                                                                                               

(b) Reports on Form 8-K.

January
10, 2003 filing, Item 5. On January 9, 2003, we entered into an underwriting agreement
for the public offering of 12,750,000 Common Units, including 1,000,000 Common Units to be
offered to four trusts established for the benefit of the children of Dan L. Duncan, the
Chairman of the Board of our General Partner. Closing of the issuance and sale of the
Common Units occurred on January 15, 2003.

61

---

# SIGNATURES

Pursuant
to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the
registrants have duly caused this combined quarterly report on Form 10-Q to be signed on
their behalf by the undersigned thereunto duly authorized, in the City of Houston, State
of Texas on May 13, 2003.

| |  | ENTERPRISE PRODUCTS PARTNERS L.P.(A Delaware Limited Partnership)ENTERPRISE PRODUCTS OPERATING L.P.(A Delaware Limited Partnership)
By:   Enterprise Products GP, LLC,          as General Partner for both registrants
| |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  |                                                                                                                                                                                                                        
| |  |                                                                                                                                                                                                                        
| |  |                                                                                                                                                                                                                        
| |  | By:   /s/ Michael J. Knesek
Name:   Michael J. Knesek
Title:    Vice President, Controller, and Principal Accounting              Officer of
 the General Partner                                                      

62

---

# SARBANES-OXLEY
SECTION 302 CERTIFICATIONS

CERTIFICATION OF O.S.
ANDRAS, PRINCIPAL EXECUTIVE OFFICER OFENTERPRISE PRODUCTS GP,
LLC THE GENERAL PARTNER OFENTERPRISE PRODUCTS
PARTNERS L.P.

I, O.S. Andras, the Principal
Executive Officer of Enterprise Products GP, LLC, the General Partner of Enterprise
Products Partners L.P., certify that:

| | 1. | I have reviewed this quarterly report on Form 10-Q of Enterprise Products
                    Partners L.P.;
| | -- | ------------------------------------------------------------------------------------------------------------

| | 2. | Based on my knowledge, this quarterly 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 quarterly
                    report;
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 3. | Based on my knowledge, the financial statements, and other financial information
                    included in this quarterly 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 quarterly report;
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 4. | The registrants other certifying officers and I are responsible for
                    establishing and maintaining disclosure controls and procedures (as defined in
                    Exchange Act Rules 13a-13 and 15d-14) for the registrant and we have:
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | a) | designed such disclosure controls and procedures 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 quarterly report is being prepared;
| |  | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | b) | evaluated the effectiveness of the registrants disclosure controls and
                    procedures as of a date within 90 days prior to the filing date of this
                    quarterly report (the Evaluation Date); and
| |  | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | c) | presented in this quarterly report our conclusions about the effectiveness of
                    the disclosure controls and procedures based on our evaluation as of the
                    Evaluation Date;
| |  | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 5. | The registrants other certifying officers and I have disclosed, based on
                    our most recent evaluation, to the registrants auditors and audit
                    committee of registrants board of directors (or persons performing the
                    equivalent function):
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | a) | all significant deficiencies in the design or operation of internal controls
                    which could adversely affect the registrants ability to record, process,
                    summarize and report financial data and have identified for the
                    registrants auditors any material weaknesses in internal controls; and
| |  | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | b) | any fraud, whether or not material, that involves management or other employees
                    who have a significant role in the registrants internal controls; and
| |  | -- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 6. | The registrants other certifying officers and I have indicated in this
                    quarterly report whether or not there were significant changes in internal
                    controls or in other factors that could significantly affect internal controls
                    subsequent to the date of our most recent evaluation, including any corrective
                    actions with regard to significant deficiencies and material weaknesses.
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Date: May 13, 2003

| |  | /s/ O.S. Andras                                                                                                                                                  
| |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Name:     O.S. Andras                                                                                                                                            
| |  | Title:       Principal Executive Officer of our General
                                                                     Partner, Enterprise Products GP, LLC

63

---

CERTIFICATION OF MICHAEL A. CREEL, PRINCIPAL FINANCIAL OFFICER OFENTERPRISE PRODUCTS GP,
LLC THE GENERAL PARTNER OFENTERPRISE PRODUCTS
PARTNERS L.P.

I, Michael A. Creel, the Principal
Financial Officer of Enterprise Products GP, LLC, the General Partner of Enterprise
Products Partners L.P., certify that:

| | 1. | I have reviewed this quarterly report on Form 10-Q of Enterprise Products
          Partners L.P.;
| | -- | --------------------------------------------------------------------------------------------------

| | 2. | Based on my knowledge, this quarterly 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 quarterly report;
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 3. | Based on my knowledge, the financial statements, and other financial information
                    included in this quarterly 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 quarterly report;
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 4. | The registrants other certifying officers and I are responsible for
                    establishing and maintaining disclosure controls and procedures (as defined in
                    Exchange Act Rules 13a-13 and 15d-14) for the registrant and we have:
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | a) | designed such disclosure controls and procedures 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 quarterly report is being prepared;
| |  | -- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | b) | evaluated the effectiveness of the registrants disclosure controls and
               procedures as of a date within 90 days prior to the filing date of this
               quarterly report (the Evaluation Date); and
| |  | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | c) | presented in this quarterly report our conclusions about the effectiveness of
               the disclosure controls and procedures based on our evaluation as of the
               Evaluation Date;
| |  | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 5. | The registrants other certifying officers and I have disclosed, based on
               our most recent evaluation, to the registrants auditors and audit
               committee of registrants board of directors (or persons performing the
               equivalent function):
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | a) | all significant deficiencies in the design or operation of internal controls
               which could adversely affect the registrants ability to record, process,
               summarize and report financial data and have identified for the
               registrants auditors any material weaknesses in internal controls; and
| |  | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | b) | any fraud, whether or not material, that involves management or other employees
               who have a significant role in the registrants internal controls; and
| |  | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 6. | The registrants other certifying officers and I have indicated in this
                    quarterly report whether or not there were significant changes in internal
                    controls or in other factors that could significantly affect internal controls
                    subsequent to the date of our most recent evaluation, including any corrective
                    actions with regard to significant deficiencies and material weaknesses.
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Date: May 13, 2003

| |  | /s/ Michael A. Creel                                                                                                                                             
| |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Name:     Michael A. Creel                                                                                                                                       
| |  | Title:       Principal Financial Officer of our General
                                                                     Partner, Enterprise Products GP, LLC

64

---

CERTIFICATION OF O.S.
ANDRAS, PRINCIPAL EXECUTIVE OFFICER OFENTERPRISE PRODUCTS GP, LLC
THE GENERAL PARTNER OF ENTERPRISE PRODUCTS
OPERATING L.P.

I, O.S. Andras, the Principal
Executive Officer of Enterprise Products GP, LLC, the General Partner of Enterprise
Products Operating L.P., certify that:

| | 1. | I have reviewed this quarterly report on Form 10-Q of Enterprise Products
          Operating L.P.;
| | -- | ---------------------------------------------------------------------------------------------------

| | 2. | Based on my knowledge, this quarterly 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 quarterly
                    report;
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 3. | Based on my knowledge, the financial statements, and other financial information
                    included in this quarterly 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 quarterly report;
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 4. | The registrants other certifying officers and I are responsible for
                    establishing and maintaining disclosure controls and procedures (as defined in
                    Exchange Act Rules 13a-13 and 15d-14) for the registrant and we have:
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | a) | designed such disclosure controls and procedures 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 quarterly report is being prepared;
| |  | -- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | b) | evaluated the effectiveness of the registrants disclosure controls and
               procedures as of a date within 90 days prior to the filing date of this
               quarterly report (the Evaluation Date); and
| |  | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | c) | presented in this quarterly report our conclusions about the effectiveness of
               the disclosure controls and procedures based on our evaluation as of the
               Evaluation Date;
| |  | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 5. | The registrants other certifying officers and I have disclosed, based on
                    our most recent evaluation, to the registrants auditors and audit
                    committee of registrants board of directors (or persons performing the
                    equivalent function):
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | a) | all significant deficiencies in the design or operation of internal controls
               which could adversely affect the registrants ability to record, process,
               summarize and report financial data and have identified for the
               registrants auditors any material weaknesses in internal controls; and
| |  | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | b) | any fraud, whether or not material, that involves management or other employees
               who have a significant role in the registrants internal controls; and
| |  | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 6. | The registrants other certifying officers and I have indicated in this
                    quarterly report whether or not there were significant changes in internal
                    controls or in other factors that could significantly affect internal controls
                    subsequent to the date of our most recent evaluation, including any corrective
                    actions with regard to significant deficiencies and material weaknesses.
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Date: May 13, 2003

| |  | /s/ O.S. Andras                                                                                                                                                  
| |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Name:     O.S. Andras                                                                                                                                            
| |  | Title:       Principal Executive Officer of our General
                                                                     Partner, Enterprise Products GP, LLC

65

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CERTIFICATION OF MICHAEL A. CREEL, PRINCIPAL FINANCIAL OFFICER OFENTERPRISE PRODUCTS GP,
LLC THE GENERAL PARTNER OFENTERPRISE PRODUCTS
OPERATING L.P.

I, Michael A. Creel, the Principal
Financial Officer of Enterprise Products GP, LLC, the General Partner of Enterprise
Products Operating L.P., certify that:

| | 1. | I have reviewed this quarterly report on Form 10-Q of Enterprise Products Operating L.P.;
| | -- | -----------------------------------------------------------------------------------------

| | 2. | Based on my knowledge, this quarterly 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 quarterly report;
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 3. | Based on my knowledge, the financial statements, and other financial information
                    included in this quarterly 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 quarterly report;
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 4. | The registrants other certifying officers and I are responsible for
                    establishing and maintaining disclosure controls and procedures (as defined in
                    Exchange Act Rules 13a-13 and 15d-14) for the registrant and we have:
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | a) | designed such disclosure controls and procedures 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 quarterly report is being prepared;
| |  | -- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | b) | evaluated the effectiveness of the registrants disclosure controls and
               procedures as of a date within 90 days prior to the filing date of this
               quarterly report (the Evaluation Date); and
| |  | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | c) | presented in this quarterly report our conclusions about the effectiveness of
               the disclosure controls and procedures based on our evaluation as of the
               Evaluation Date;
| |  | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 5. | The registrants other certifying officers and I have disclosed, based on
                    our most recent evaluation, to the registrants auditors and audit
                    committee of registrants board of directors (or persons performing the
                    equivalent function):
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | a) | all significant deficiencies in the design or operation of internal controls
               which could adversely affect the registrants ability to record, process,
               summarize and report financial data and have identified for the
               registrants auditors any material weaknesses in internal controls; and
| |  | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | b) | any fraud, whether or not material, that involves management or other employees
               who have a significant role in the registrants internal controls; and
| |  | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 6. | The registrants other certifying officers and I have indicated in this
                    quarterly report whether or not there were significant changes in internal
                    controls or in other factors that could significantly affect internal controls
                    subsequent to the date of our most recent evaluation, including any corrective
                    actions with regard to significant deficiencies and material weaknesses.
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Date: May 13, 2003

| |  | /s/ Michael A. Creel                                                                                                                                             
| |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Name:     Michael A. Creel                                                                                                                                       
| |  | Title:       Principal Financial Officer of our General
                                                                     Partner, Enterprise Products GP, LLC

66

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EXHIBIT 99.1

CERTIFICATION OF O.S.
ANDRAS, CHIEF EXECUTIVE OFFICEROF
ENTERPRISE PRODUCTS GP, LLC THE GENERAL PARTNER OF ENTERPRISE PRODUCTS OPERATING L.P. AND
ENTERPRISE PRODUCTS PARTNERS L.P.

In
connection with this combined quarterly report of Enterprise Products Partners L.P. and
Enterprise Products Operating L.P. (collectively, the Registrants) on Form
10-Q for the three months ending March 31, 2003 as filed with the Securities and Exchange
Commission on the date hereof (the Report), I, O.S. Andras, Chief Executive
Officer of Enterprise Products GP, LLC, the General Partner of the Registrants, certify,
pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley
Act of 2002, that:

(1)       
          The Report fully complies with the requirements of Section 13(a) 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 the Registrants.

|/s/ O.S. Andras                                                                                                                                                                                                                                       
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Name:     O.S. Andras                                                                                                                                                                                                                                 
|Title:       Chief Executive Officer of Enterprise Products GP, LLC
                                                                     on behalf of Enterprise Products Operating L.P. and
                        Enterprise Products Partners L.P.
|                                                                                                                                                                                                                                                      
|Date:      May 13, 2003                                                                                                                                                                                                                               

A signed original of this written
statement required by Section 906 has been provided to the Registrants and will be
retained by the Registrants and furnished to Securities and Exchange Commission or its
staff upon request.

---

CERTIFICATION OF MICHAEL A. CREEL, CHIEF FINANCIAL OFFICER OF ENTERPRISE PRODUCTS GP,
LLC THE GENERAL PARTNER OFENTERPRISE PRODUCTS
OPERATING L.P. AND ENTERPRISE PRODUCTS PARTNERS L.P.

In
connection with the combined quarterly report of Enterprise Products Partners L.P. and
Enterprise Products Operating L.P. (collectively, the Registrants) on Form
10-Q for the three months ending March 31, 2003 as filed with the Securities and Exchange
Commission on the date hereof (the Report), I, Michael A. Creel, Chief
Financial Officer of Enterprise Products GP, LLC, the General Partner of the Registrants,
certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the
Sarbanes-Oxley Act of 2002, that:

(1)       
          The Report fully complies with the requirements of Section 13(a) 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 the Registrants.

|/s/ Michael A. Creel                                                                                                                                                                                                                           
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Name:     Michael A. Creel                                                                                                                                                                                                                     
|Title:       Chief Financial Officer of Enterprise Products GP, LLC
                                                                     on behalf of Enterprise Products Operating L.P. and       
          Enterprise Products Partners L.P.
|                                                                                                                                                                                                                                               
|Date:      May 13, 2003                                                                                                                                                                                                                        

A signed original of this written
statement required by Section 906 has been provided to the Registrants and will be
retained by the Registrants and furnished to Securities and Exchange Commission or its
staff upon request.