<PAGE>   1

--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

                                 UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                             ---------------------

                                   FORM 10-Q

(MARK ONE)

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

                 FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2001

                                       OR

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

             FOR THE TRANSITION PERIOD FROM           TO

                          COMMISSION FILE NO. 1-11680

                         EL PASO ENERGY PARTNERS, L.P.
             (Exact Name of Registrant as Specified in its Charter)

<TABLE>
<S>                                            <C>
                   DELAWARE                                      76-0396023
         (State or Other Jurisdiction                         (I.R.S. Employer
      of Incorporation or Organization)                     Identification No.)

               EL PASO BUILDING
            1001 LOUISIANA STREET
                HOUSTON, TEXAS                                     77002
   (Address of Principal Executive Offices)                      (Zip Code)
</TABLE>

       Registrant's Telephone Number, Including Area Code: (713) 420-2600

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

     The registrant had 34,062,814 common units outstanding as of May 9, 2001.

--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<PAGE>   2

                        PART I -- FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

                         EL PASO ENERGY PARTNERS, L.P.

                CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                    (IN THOUSANDS, EXCEPT PER UNIT AMOUNTS)
                                  (UNAUDITED)

<TABLE>
<CAPTION>
                                                                QUARTER ENDED
                                                                  MARCH 31,
                                                              ------------------
                                                                2001      2000
                                                              --------   -------
<S>                                                           <C>        <C>
Operating revenues..........................................  $ 54,502   $18,950
                                                              --------   -------
Operating expenses
  Purchased natural gas costs...............................    22,290     1,072
  Operations and maintenance, net...........................     6,380     2,008
  Depreciation, depletion and amortization..................     8,302     6,476
  Asset impairment charge...................................     3,921        --
                                                              --------   -------
                                                                40,893     9,556
                                                              --------   -------
Operating income............................................    13,609     9,394
                                                              --------   -------
Other income (loss)
  Earnings (loss) from unconsolidated affiliates............    (4,712)    3,850
  Net loss on sales of assets...............................   (10,381)       --
  Other income..............................................    25,981        82
                                                              --------   -------
                                                                10,888     3,932
                                                              --------   -------
Income before interest, income taxes and other charges......    24,497    13,326
                                                              --------   -------
Interest and debt expense...................................    11,483    11,380
Minority interest...........................................        41        10
Income tax benefit..........................................        --        (3)
                                                              --------   -------
                                                                11,524    11,387
                                                              --------   -------
Net income..................................................    12,973     1,939
Net income allocated to General Partner.....................     4,695     3,232
Net income allocated to Series B unitholders................     4,322        --
                                                              --------   -------
Net income (loss) allocated to limited partners.............  $  3,956   $(1,293)
                                                              ========   =======
Basic and diluted net income (loss) per unit................  $   0.12   $ (0.05)
                                                              ========   =======
Weighted average number of units outstanding................    32,471    27,029
                                                              ========   =======
</TABLE>

                            See accompanying notes.

                                        1
<PAGE>   3

                         EL PASO ENERGY PARTNERS, L.P.

                     CONDENSED CONSOLIDATED BALANCE SHEETS
                      (IN THOUSANDS, EXCEPT UNIT AMOUNTS)
                                  (UNAUDITED)

<TABLE>
<CAPTION>
                                                              MARCH 31,    DECEMBER 31,
                                                                 2001          2000
                                                              ----------   ------------
<S>                                                           <C>          <C>
                                        ASSETS

Current assets
  Cash and cash equivalents.................................   $ 93,211      $ 20,281
  Accounts receivable, net..................................     43,209        32,734
  Other current assets......................................        675           633
                                                               --------      --------
          Total current assets..............................    137,095        53,648

Property, plant, and equipment, net.........................    748,546       631,695
Investments in unconsolidated affiliates....................     79,689       182,734
Other noncurrent assets.....................................     30,558        11,182
                                                               --------      --------
          Total assets......................................   $995,888      $879,259
                                                               ========      ========

                           LIABILITIES AND PARTNERS' CAPITAL

Current liabilities
  Accounts payable..........................................   $ 10,813      $ 14,425
  Accrued interest..........................................      8,113         3,107
  Other current liabilities.................................      9,117         2,171
                                                               --------      --------
          Total current liabilities.........................     28,043        19,703

Revolving credit facility...................................    338,000       318,000
Long-term debt..............................................    175,000       175,000
Project financing...........................................     70,000        45,000
Other noncurrent liabilities................................     11,955        12,851
                                                               --------      --------
          Total liabilities.................................    622,998       570,554
                                                               --------      --------
Commitments and contingencies
Minority interest...........................................     (2,390)       (2,366)
Partners' capital
  Limited partners
     Series B preference units; 170,000 units issued and
      outstanding...........................................    179,989       175,668
     Common units; 34,042,814 and 31,550,314 units issued
      and outstanding.......................................    192,705       132,802
  General partner...........................................      2,586         2,601
                                                               --------      --------
          Total partners' capital...........................    375,280       311,071
                                                               --------      --------
          Total liabilities and partners' capital...........   $995,888      $879,259
                                                               ========      ========
</TABLE>

                            See accompanying notes.

                                        2
<PAGE>   4

                         EL PASO ENERGY PARTNERS, L.P.

                CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (IN THOUSANDS)
                                  (UNAUDITED)

<TABLE>
<CAPTION>
                                                                 QUARTER ENDED
                                                                   MARCH 31,
                                                              --------------------
                                                                2001        2000
                                                              ---------   --------
<S>                                                           <C>         <C>
Cash flows from operating activities
  Net income................................................  $  12,973   $  1,939
  Adjustments to reconcile net income to net cash from
     operating activities
     Depreciation, depletion and amortization...............      8,302      6,476
     Asset impairment charge................................      3,921         --
     Net loss on sales of assets............................     10,381         --
     Distributed earnings of unconsolidated affiliates
       (Earnings) loss from unconsolidated affiliates.......      4,712     (3,850)
       Distributions from unconsolidated affiliates.........      6,922      8,740
  Other noncash items.......................................      1,063        701
  Working capital changes, net of non-cash transactions.....    (22,375)     6,447
                                                              ---------   --------
          Net cash provided by operating activities.........     25,899     20,453
                                                              ---------   --------
Cash flows from investing activities
  Additions to property, plant and equipment................   (156,975)    (6,086)
  Proceeds from sales of assets.............................    108,233         --
  Additions to investments in unconsolidated affiliates.....         --     (3,015)
  Cash paid for acquisitions, net of cash acquired..........         --    (26,476)
  Other.....................................................        140       (280)
                                                              ---------   --------
          Net cash used in investing activities.............    (48,602)   (35,857)
                                                              ---------   --------
Cash flows from financing activities
  Net proceeds from revolving credit facility...............    140,620     43,000
  Revolving credit repayments...............................   (121,000)    (6,000)
  Net proceeds from project financing.......................     24,962         --
  Net proceeds from issuance of common units................     73,358         --
  Distributions to partners.................................    (22,307)   (17,652)
                                                              ---------   --------
          Net cash provided by financing activities.........     95,633     19,348
                                                              ---------   --------
Increase in cash and cash equivalents.......................     72,930      3,944
Cash and cash equivalents
  Beginning of period.......................................     20,281      4,202
                                                              ---------   --------
  End of period.............................................  $  93,211   $  8,146
                                                              =========   ========
</TABLE>

                            See accompanying notes.

                                        3
<PAGE>   5

                         EL PASO ENERGY PARTNERS, L.P.

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                  (UNAUDITED)

1. BASIS OF PRESENTATION

     Our 2000 Annual Report on Form 10-K includes a summary of our significant
accounting policies and other disclosures. You should read it in conjunction
with this Quarterly Report on Form 10-Q. The condensed consolidated financial
statements at March 31, 2001, and for the quarters ended March 31, 2001 and
2000, are unaudited. The condensed consolidated balance sheet at December 31,
2000, is derived from the audited financial statements. These financial
statements do not include all disclosures required by accounting principles
generally accepted in the United States, but have been prepared pursuant to the
rules and regulations of the United States Securities and Exchange Commission
(SEC). In our opinion, all material adjustments, all of which are of a normal
recurring nature, have been made to fairly present our results of operations.
Information for any interim period may not necessarily indicate the results of
operations for the entire year due to the seasonal nature of our businesses. The
prior period information includes reclassifications, which were made to conform
to the current presentation. These reclassifications have no effect on our
reported net income, cash flows or partners' capital.

  Adoption of SFAS No. 133

     We adopted Statement of Financial Accounting Standards (SFAS) No. 133,
Accounting for Derivative Instruments and Hedging Activities, on January 1,
2001. All of our existing derivative instruments expired in December 2000 and
accordingly, there was no impact as a result of our adoption.

     During the normal course of our business, we may enter into contracts that
qualify as derivatives according to SFAS No. 133's definition of a derivative.
Accordingly, we evaluate our contracts to see if derivative accounting is
necessary. Contracts that meet the criteria of a derivative are then evaluated
for the normal purchases and normal sales exception. Contracts qualifying as
normal purchases and normal sales are documented in order to be excluded from
accounting under SFAS No. 133.

     We may also purchase and sell instruments to economically hedge price
fluctuations in the commodity markets. These instruments are not documented as
hedges due to their short-term nature, or do not qualify under SFAS No. 133 for
hedge accounting due to the terms in the instruments. Where such derivatives do
not qualify, they are marked to market with the earnings impact recognized in
operating income.

2. ACQUISITIONS AND DISPOSITIONS

  EPN Texas

     In February 2001, we acquired the south Texas fee-based natural gas liquids
(NGL) transportation and fractionation assets (EPN Texas) from a subsidiary of
El Paso Corporation for $133 million. We funded the acquisition of these assets
by borrowing from our revolving credit facility. These assets include more than
600 miles of NGL gathering and transportation pipelines. The NGL pipeline system
gathers and transports unfractionated and fractionated products. We also
acquired three fractionation plants with a capacity of approximately 96 MBbls/d.
These plants fractionate NGLs into ethane, propane, and butane products which
are used by refineries and petrochemical plants along the Texas Gulf Coast. We
accounted for the acquisition as a purchase and assigned the purchase price to
the assets acquired based upon the estimated fair value of the assets as of the
acquisition date. The values assigned are preliminary and may be revised based
on additional information.

---------------
As generally used in the energy industry and in this document, the following
terms have the following meanings:

<TABLE>
<S>        <C>                                          <C>        <C>
Bbl        = barrel                                     Mcf        = thousand cubic feet
MBbls(/d)  = thousand barrels (per day)                 MMcf       = million cubic feet
</TABLE>

When we refer to cubic feet measurements, all measurements are at 14.73 pounds
per square inch.
                                        4
<PAGE>   6

     The following selected unaudited pro forma information represents our
consolidated results of operations on a pro forma basis for the first quarters
ended March 31, 2001 and 2000, as if we acquired EPN Texas on January 1, 2000:

<TABLE>
<CAPTION>
                                                                2001          2000
                                                              --------      --------
                                                              (IN THOUSANDS, EXCEPT
                                                                PER UNIT AMOUNTS)
<S>                                                           <C>           <C>
Operating revenues..........................................  $59,544       $27,338
Operating income............................................  $16,553       $14,914
Net income..................................................  $14,195       $ 4,782
Basic and diluted net income per unit.......................  $  0.16       $  0.05
</TABLE>

  Gulf of Mexico assets

     In accordance with a Federal Trade Commission (FTC) order related to El
Paso Corporation's merger with The Coastal Corporation, we, along with Deepwater
Holdings L.L.C., agreed to sell several of our offshore Gulf of Mexico assets to
third parties in January 2001. Total consideration paid for these assets was
approximately $158 million consisting of approximately $108 million for the
assets we sold and approximately $50 million for the assets Deepwater Holdings
sold. The offshore assets sold include interests in Stingray, Nautilus, Manta
Ray Offshore, Nemo, Tarpon and the Green Canyon pipeline assets, as well as
interests in two offshore platforms and one dehydration facility. We recognized
net losses from the asset sales of approximately $10.4 million, and Deepwater
Holdings recognized losses of approximately $14.9 million. Our share of
Deepwater Holdings' losses was approximately $10 million, which has been
reflected in earnings (loss) from unconsolidated affiliates in the accompanying
statements of operations. Also related to the same FTC order, Deepwater Holdings
sold its interest in UTOS in April 2001. The proceeds from this sale were
approximately $4 million and Deepwater Holdings recognized a loss of $6.1
million, of which $4.2 million represents our share.

     As additional consideration for the above transactions, El Paso Corporation
will make payments to us totaling $29 million. These payments will be made in
quarterly installments of $2.25 million for the next three years and $2 million
in the first quarter of 2004. From this additional consideration, we realized
income of approximately $25.4 million, which has been reflected in other income
in the accompanying statements of operations.

3. PARTNERS' CAPITAL

  Public offering of common units

     In March 2001, we completed a public offering of 2,250,000 common units. We
used the net cash proceeds of $66.8 million to reduce indebtedness under our
revolving credit facility. In addition, our General Partner contributed $0.7
million to us in order to satisfy its one percent contribution requirement.

  Cash distributions

     In February 2001, we paid cash distributions of $0.55 per common unit and
our General Partner received incentive distributions of $4.6 million. In April
2001, we declared a cash distribution of $0.575 per common unit for the quarter
ended March 31, 2001, which we will pay on May 15, 2001, to holders of record as
of April 30, 2001. In addition, we will pay our General Partner $5.8 million in
incentive distributions. At the current distribution rates, our General Partner
receives approximately 24 percent of total cash distributions we pay.

  Other

     During the quarter ended March 31, 2001, we received net proceeds of $6.6
million related to the exercise of 242,500 common unit options.

                                        5
<PAGE>   7

4. PROPERTY, PLANT AND EQUIPMENT

     Our property, plant and equipment consisted of the following:

<TABLE>
<CAPTION>
                                                              MARCH 31,   DECEMBER 31,
                                                                2001          2000
                                                              ---------   ------------
                                                                   (IN THOUSANDS)
<S>                                                           <C>         <C>
Property, plant and equipment, at cost
  Pipelines.................................................  $363,226      $239,920
  Platforms and facilities..................................    96,118       127,639
  Oil and natural gas properties............................   156,320       156,320
  Natural gas storage facilities............................   144,142       147,294
  Construction work-in-progress.............................   150,804       127,811
                                                              --------      --------
                                                               910,610       798,984
Less accumulated depreciation, depletion, and
  amortization..............................................   162,064       167,289
                                                              --------      --------
     Property, plant and equipment, net.....................  $748,546      $631,695
                                                              ========      ========
</TABLE>

     Due to the sale of our interest in the Manta Ray Offshore system in January
2001, we lost a primary connecting point to our Manta Ray pipeline. As a result,
we abandoned the Manta Ray pipeline and recorded an impairment of approximately
$3.9 million which is reflected in the Gathering, Transportation and Platforms
segment.

5. DEBT AND OTHER CREDIT FACILITIES

  8.50% Senior subordinated notes

     In May 2001, we issued $250 million aggregate principal amount of 8.50%
Senior Subordinated Notes due 2011. Proceeds of approximately $243 million, net
of issuance costs, were used to reduce indebtedness under our revolving credit
facility.

  Credit facility

     As of March 31, 2001, we had $338 million outstanding under our revolving
credit facility and $145 million available under the borrowing base limitations,
and the average interest rate was 7.68%. We pay a commitment fee of 0.25 percent
per annum on the unused and unavailable portion of the credit facility and 0.50
percent per annum on the unused and available portion. We are currently
negotiating with a syndicated bank group to increase the size of our credit
facility from $500 million to $600 million and extend the maturity through May
2004.

  Project finance loan

     In August 2000, Argo L.L.C., one of our subsidiaries, obtained a $95
million limited recourse project finance loan from a group of commercial
lenders. This loan is a syndication of a construction loan that is convertible
into a term loan upon completion of the construction project. As of March 31,
2001, Argo had $70 million outstanding, and the average interest rate was 6.9%.

  Other credit facilities

     Deepwater Holdings and Poseidon Oil Pipeline Company, L.L.C. are parties to
credit agreements under which each has outstanding obligations that may restrict
their ability to pay distributions to their respective owners.

     Deepwater Holdings has a revolving credit facility with a syndicate of
commercial banks to provide up to $175 million. As of March 31, 2001, Deepwater
Holdings had $110 million outstanding under its credit facility at an average
floating interest rate of 6.43% and $16 million available under its borrowing
base limitations. The proceeds from the sale of Stingray and the West Cameron
dehydration facility in January 2001 of approximately $50 million were used to
reduce the revolving credit facility. The proceeds from the sale of UTOS in
April 2001 were also used to reduce the revolving credit facility.

                                        6
<PAGE>   8

     As of March 31, 2001, Poseidon had $150 million outstanding under its
revolving credit facility at an average floating interest rate of 6.56%. In
April 2001, Poseidon amended and restated its credit facility to provide up to
$185 million with a maturity of April 2004.

6. COMMITMENTS AND CONTINGENCIES

     We, along with several subsidiaries of El Paso, have been named defendants
in actions brought by Jack Grynberg on behalf of the United States Government
under the False Claims Act. Generally, these complaints allege an industry-wide
conspiracy to under report the heating value as well as the volumes of the
natural gas produced from federal and Native American lands, which deprived the
United States Government of royalties. These matters have been consolidated for
pretrial purposes (In re: Natural Gas Royalties Qui Tam Litigation, United
States District Court for the District of Wyoming).

     We have also been named a defendant in Quinque Operating Company, et al v.
Gas Pipelines and Their Predecessors, et al, filed in 1999 in the District Court
of Stevens County, Kansas. This class action complaint alleges that the
defendants mismeasured natural gas volumes and heating content of natural gas on
non-federal and non-Native American lands. The Quinque complaint, was
transferred to the same court handling the Grynberg complaint, and has now been
sent back to Kansas State Court for further proceedings.

     We are also a named defendant in numerous lawsuits and a named party in
numerous governmental proceedings arising in the ordinary course of our
business.

     While the outcome of the matters discussed above cannot be predicted with
certainty, we do not expect the ultimate resolution of these matters to have a
material adverse effect on our financial position, results of operations, or
cash flows.

  Environmental

     We are subject to extensive federal, state, and local laws and regulations
governing environmental quality and pollution control. These laws and
regulations require us to remove or remedy the effect on the environment of the
disposal or release of specified substances at current and former operating
sites.

     It is possible that new information or future developments could require us
to reassess our potential exposure to environmental matters. We may incur
significant costs and liabilities in order to comply with existing environmental
laws and regulations. It is also possible that other developments, such as
increasingly strict environmental laws, regulations and claims for damages to
property, employees, other persons and the environment resulting from current or
past operations, could result in substantial costs and liabilities in the
future. As this information becomes available, or other relevant developments
occur, we will make accruals accordingly.

7. SEGMENT INFORMATION

     We segregate our business activities into four distinct operating segments:

     - Gathering, Transportation and Platforms;

     - Liquid Transportation and Fractionation;

     - Natural Gas Storage; and

     - Oil and Natural Gas Production.

     As a result of our acquisition of EPN Texas in February 2001, we began
providing NGL transportation and fractionation services and have shown these
activities as a separate segment called Liquid Transportation and Fractionation.
This segment also includes the liquid transportation services of the Allegheny
and Poseidon oil pipelines which were previously reflected in the Gathering,
Transportation and Platforms segment. Accordingly, to the extent practicable, we
have restated the prior period to conform to the current business segment
presentation. The restated results of operations for the quarter ended March 31,
2000, are not

                                        7
<PAGE>   9

necessarily indicative of the results which would have been achieved had the
revised business structure been in effect during the period.

     Each of our segments are business units that offer different services and
products. They are managed separately, as each requires different technology and
marketing strategies. We measure segment performance using performance cash
flows, or an asset's ability to generate cash flow. Performance cash flow should
not be considered an alternate to earnings before interest expense and taxes
(EBIT) as an indicator of operating performance. Following are results as of and
for the quarters ending March 31:

<TABLE>
<CAPTION>
                                                     LIQUID
                                 GATHERING,      TRANSPORTATION    NATURAL      OIL AND
                               TRANSPORTATION          AND           GAS      NATURAL GAS
                                AND PLATFORMS     FRACTIONATION    STORAGE    PRODUCTION    OTHER(1)    TOTAL
                               ---------------   ---------------   --------   -----------   --------   --------
                                                                (IN THOUSANDS)
<S>                            <C>               <C>               <C>        <C>           <C>        <C>
2001
  Revenue from external
     customers...............     $ 34,819          $  4,271       $  4,957     $10,455     $     --   $ 54,502
  Intersegment revenue.......        3,288                --             23          --       (3,311)        --
  Depreciation, depletion and
     amortization............        4,013               248          1,401       2,386          254      8,302
  Asset impairment charge....        3,921                --             --          --           --      3,921
  Operating income (loss)....        4,763             2,940          2,513       3,906         (513)    13,609
  Earnings (loss) from
     unconsolidated
     affiliates..............       (8,805)            4,093             --          --           --     (4,712)
  EBIT.......................      (14,290)            7,033          2,513       3,906       25,335     24,497
  Performance cash
     flows(2)................       17,975             6,860          3,914       6,292          186     35,227
  Assets.....................      432,684           202,906        180,050      55,231      125,017    995,888

2000
  Revenue from external
     customers...............     $ 11,627          $  1,531       $     --     $ 5,792     $     --   $ 18,950
  Intersegment revenue.......        3,166                --             --          --       (3,166)        --
  Depreciation, depletion and
     amortization............        2,831               530             --       3,060           55      6,476
  Operating income (loss)....        9,745               998             --      (1,294)         (55)     9,394
  Earnings from
     unconsolidated
     affiliates..............        2,680             1,170             --          --           --      3,850
  EBIT.......................       12,426             2,168             --      (1,294)          26     13,326
  Performance cash
     flows(2)................       19,877             2,967             --       1,402           82     24,328
  Assets.....................      456,877            69,636             --      65,038       19,137    610,688
</TABLE>

---------------------

(1) Represents intersegment eliminations and other income or assets not
    associated with our segment activities.

(2) Performance cash flows are determined by taking operating income, and adding
    or subtracting as appropriate, cash distributions from equity investments,
    depreciation, depletion and amortization, and other non-cash items.

                                        8
<PAGE>   10

8. INVESTMENTS IN UNCONSOLIDATED AFFILIATES

     We hold investments in various affiliates which we account for using the
equity method of accounting. Summarized financial information for these
investments is as follows:
                          QUARTER ENDED MARCH 31, 2001
                                 (IN THOUSANDS)

<TABLE>
<CAPTION>
                                                        DEEPWATER
                                                       HOLDINGS(1)   POSEIDON   OTHER(2)    TOTAL
                                                       -----------   --------   --------   -------
<S>                                                    <C>           <C>        <C>        <C>
OWNERSHIP INTEREST...................................        50%         36%     25.67%
                                                        ========     =======     ======
OPERATING RESULTS DATA:
  Operating revenues.................................   $ 14,779     $18,568     $1,982
  Other income.......................................         --         366        (85)
  Operating expenses.................................     (6,484)     (1,497)      (590)
  Depreciation.......................................     (2,886)     (2,837)      (953)
  Other expenses.....................................     (2,978)     (2,821)       222
  Loss on sale.......................................    (14,925)         --         --
                                                        --------     -------     ------
  Net income (loss)..................................   $(12,494)    $11,779     $  576
                                                        ========     =======     ======
OUR SHARE:
  Allocated income (loss)............................   $ (6,247)    $ 4,240     $  148
  Adjustments(3).....................................     (2,697)       (147)        (9)
                                                        --------     -------     ------
  Earnings (loss) from unconsolidated affiliates.....   $ (8,944)    $ 4,093     $  139    $(4,712)
                                                        ========     =======     ======    =======
  Allocated distributions............................   $  3,250     $ 3,672     $   --    $ 6,922
                                                        ========     =======     ======    =======
</TABLE>

                          QUARTER ENDED MARCH 31, 2000
                                 (IN THOUSANDS)

<TABLE>
<CAPTION>
                                                         DEEPWATER
                                                         HOLDINGS     POSEIDON   OTHER(2)   TOTAL
                                                        -----------   --------   --------   ------
<S>                                                     <C>           <C>        <C>        <C>
OWNERSHIP INTEREST....................................        50%         36%     25.67%
                                                          =======     =======    =======
OPERATING RESULTS DATA:
  Operating revenues..................................    $15,086     $11,130    $ 7,327
  Other income........................................         87         195        705
  Operating expenses..................................     (8,354)     (1,678)    (1,455)
  Depreciation........................................     (4,039)     (1,941)    (2,275)
  Other expenses......................................     (1,494)     (2,827)      (108)
                                                          -------     -------    -------
  Net income..........................................    $ 1,286     $ 4,879    $ 4,194
                                                          =======     =======    =======
OUR SHARE:
  Allocated income....................................    $   643     $ 1,756    $ 1,077
  Adjustments(4)......................................        903        (586)        57
                                                          -------     -------    -------
  Earnings from unconsolidated affiliates.............    $ 1,546     $ 1,170    $ 1,134    $3,850
                                                          =======     =======    =======    ======
  Allocated distributions.............................    $ 5,100     $ 1,440    $ 2,200    $8,740
                                                          =======     =======    =======    ======
</TABLE>

---------------

(1) In January 2001, Deepwater Holdings sold its Stingray and West Cameron
    subsidiaries. Deepwater Holdings sold its interest in its UTOS subsidiary in
    April 2001.
(2) Other contains Manta Ray Offshore Gathering Company, L.L.C. and Nautilus
    Pipeline Company L.L.C. In January 2001, we sold our 25.67% interest in
    Manta Ray Offshore and our 25.67% interest in Nautilus.
(3) We recorded adjustments primarily for differences from estimated year end
    2000 earnings reported in our Annual Report on Form 10-K and actual earnings
    reported in the 2000 audited annual reports of our unconsolidated
    affiliates. For the quarter ended March 31, 2001, we recorded an additional
    adjustment relating to the sale of Stingray and West Cameron. The loss on
    these sales was not allocated proportionately with Deepwater Holdings'
    ownership percentages because the capital contributed by us was a larger
    amount of capital at the formation and therefore we were allocated a larger
    portion of the loss. Our total share of the loss relating to these sales was
    approximately $10 million.
(4) We recorded adjustments primarily for differences from estimated year end
    1999 earnings reported in our Annual Report on Form 10-K and actual earnings
    reported in the 1999 audited annual reports of our unconsolidated
    affiliates, and for purchase price adjustments under Accounting Principles
    Board (APB) Opinion No. 16, "Business Combinations."

                                        9
<PAGE>   11

9. RELATED PARTY TRANSACTIONS

     Our transactions with related parties and affiliates are as follows:

<TABLE>
<CAPTION>
                                                               QUARTER ENDED
                                                                 MARCH 31,
                                                              ----------------
                                                               2001      2000
                                                              -------   ------
                                                               (IN THOUSANDS)
<S>                                                           <C>       <C>
Revenues received from related parties:
  Oil and natural gas sales.................................  $ 2,689   $5,696
  Liquid transportation and fractionation services..........    2,306       --
  Gathering, transportation and platform services...........      837       --
                                                              -------   ------
                                                              $ 5,832   $5,696
                                                              =======   ======
Expenses paid to related parties:
  Purchased natural gas costs...............................  $12,795   $   --
  Operating expenses........................................    7,582    4,529
                                                              -------   ------
                                                              $20,377   $4,529
                                                              =======   ======
Reimbursements received from related parties:
  Operating expenses........................................  $ 4,909   $5,021
                                                              =======   ======
</TABLE>

     There have been no changes to our related party relationships, except as
described below, from our 2000 Annual Report on Form 10-K.

     At March 31, 2001, and December 31, 2000, our accounts receivable balances
due from related parties was $30.4 million and $1.6 million, respectively. Our
accounts receivable due from related parties at March 31, 2001, included El Paso
Corporation's payment of approximately $25.4 million in connection with the
sales of our Gulf of Mexico assets in January 2001. At March 31, 2001, our
accounts payable due to related parties was $1.2 million. At December 31, 2000,
we had no accounts payable due to related parties.

     In connection with our acquisition of EPN Texas, we entered into a
twenty-year transportation and fractionation agreement with El Paso NGL
Marketing, L.P., an affiliate of our General Partner. In this agreement, El Paso
NGL Marketing has agreed to deliver all of the NGL's derived from processing
operations at seven natural gas processing plants in south Texas owned by
affiliates of El Paso NGL Marketing to our south Texas NGL gathering and
fractionation facilities. We have dedicated 100 percent of the capacity of these
facilities to El Paso NGL Marketing.

10. GUARANTOR FINANCIAL INFORMATION

     On May 1, 2001, we purchased our General Partner's 1.01% non-managing
interest owned in twelve of our subsidiaries for $8 million. As a result of this
acquisition, all of our subsidiaries, excluding our joint ventures, are
wholly-owned by us. Our revolving credit facility is guaranteed by us and each
of our subsidiaries (excluding our Argo, L.L.C. and Argo I, L.L.C. subsidiaries)
and is collateralized by our management agreement, substantially all of our
assets, and our General Partner's one percent general partner interest. In
addition, our 10 3/8% Senior Subordinated Notes are guaranteed by all of our
subsidiaries except Argo and Argo I. In accordance with Rule 3-10(e) of
Regulation S-X, we are providing the following condensed consolidating financial
information of us (as the Issuer) and our subsidiaries as if our current
organizational structure were in place for all periods presented. The
consolidating eliminations column eliminates our investment in consolidated
subsidiaries, intercompany payables and receivables and other transactions
between subsidiaries.

                                        10
<PAGE>   12

                CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS
                      FOR THE QUARTER ENDED MARCH 31, 2001

<TABLE>
<CAPTION>
                                               NON-GUARANTOR     GUARANTOR     CONSOLIDATING   CONSOLIDATED
                                    ISSUER    SUBSIDIARIES(1)   SUBSIDIARIES   ELIMINATIONS       TOTAL
                                    -------   ---------------   ------------   -------------   ------------
                                                                (IN THOUSANDS)
<S>                                 <C>       <C>               <C>            <C>             <C>
Operating revenues................  $    --        $  --          $ 57,813        $(3,311)       $ 54,502
                                    -------        -----          --------        -------        --------
Operating expenses
  Purchased natural gas costs.....       --           --            22,638           (348)         22,290
  Operations and maintenance,
     net..........................    1,791          183             7,393         (2,987)          6,380
  Depreciation, depletion and
     amortization.................      254           --             8,048             --           8,302
  Asset impairment charge.........       --           --             3,921             --           3,921
                                    -------        -----          --------        -------        --------
                                      2,045          183            42,000         (3,335)         40,893
                                    -------        -----          --------        -------        --------
Operating income (loss)...........   (2,045)        (183)           15,813             24          13,609
                                    -------        -----          --------        -------        --------
Other income (loss)
  Earnings (loss) from
     unconsolidated affiliates....     (168)          --            (4,712)           168          (4,712)
  Net loss on sales of assets.....       --           --           (10,381)            --         (10,381)
  Other income....................   25,848           --               133             --          25,981
                                    -------        -----          --------        -------        --------
                                     25,680           --           (14,960)           168          10,888
                                    -------        -----          --------        -------        --------
Income (loss) before interest,
  income taxes and other
  charges.........................   23,635         (183)              853            192          24,497
Interest and debt expense.........   10,898          560                --             25          11,483
Minority interest.................       --           --                41             --              41
                                    -------        -----          --------        -------        --------
  Net income (loss)...............  $12,737        $(743)         $    812        $   167        $ 12,973
                                    =======        =====          ========        =======        ========
</TABLE>

                CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS
                      FOR THE QUARTER ENDED MARCH 31, 2000

<TABLE>
<CAPTION>
                                                    NON-GUARANTOR     GUARANTOR     CONSOLIDATING   CONSOLIDATED
                                         ISSUER    SUBSIDIARIES(1)   SUBSIDIARIES   ELIMINATIONS       TOTAL
                                        --------   ---------------   ------------   -------------   ------------
                                                                     (IN THOUSANDS)
<S>                                     <C>        <C>               <C>            <C>             <C>
Operating revenues....................  $     --         $--           $22,116         $(3,166)       $18,950
                                        --------         ---           -------         -------        -------
Operating expenses
  Purchased natural gas costs.........        --          --             1,072              --          1,072
  Operations and maintenance, net.....     3,128          --             2,071          (3,191)         2,008
  Depreciation, depletion and
     amortization.....................        55          --             6,421              --          6,476
                                        --------         ---           -------         -------        -------
                                           3,183          --             9,564          (3,191)         9,556
                                        --------         ---           -------         -------        -------
Operating income (loss)...............    (3,183)         --            12,552              25          9,394
                                        --------         ---           -------         -------        -------
Other income (loss)
  Earnings from unconsolidated
     affiliates.......................        --          --             3,850              --          3,850
  Other income........................        81          --                26             (25)            82
                                        --------         ---           -------         -------        -------
                                              81          --             3,876             (25)         3,932
                                        --------         ---           -------         -------        -------
Income (loss) before interest, income
  taxes and other charges.............    (3,102)         --            16,428              --         13,326
Interest and debt expense.............    11,380          --                --              --         11,380
Minority interest.....................        10          --                --              --             10
Income tax benefit....................        --          --                 3              --              3
                                        --------         ---           -------         -------        -------
  Net income (loss)...................  $(14,492)        $--           $16,431         $    --        $ 1,939
                                        ========         ===           =======         =======        =======
</TABLE>

---------------

(1) This represents Argo and Argo I, which were formed in August 2000.

                                        11
<PAGE>   13

                     CONDENSED CONSOLIDATING BALANCE SHEETS
                                 MARCH 31, 2001

<TABLE>
<CAPTION>
                                               NON-GUARANTOR     GUARANTOR     CONSOLIDATING   CONSOLIDATED
                                    ISSUER    SUBSIDIARIES(1)   SUBSIDIARIES   ELIMINATIONS       TOTAL
                                   --------   ---------------   ------------   -------------   ------------
                                                                (IN THOUSANDS)
<S>                                <C>        <C>               <C>            <C>             <C>
Current assets
  Cash and cash equivalents......  $ 84,435       $  8,776       $      --       $      --       $ 93,211
  Accounts receivable, net.......   528,901         (2,165)       (479,392)         (4,135)        43,209
  Other current assets...........       350             --             347             (22)           675
                                   --------       --------       ---------       ---------       --------
     Total current assets........   613,686          6,611        (479,045)         (4,157)       137,095
Property, plant and equipment,
  net............................     1,545        106,562         646,391          (5,952)       748,546
Investments in unconsolidated
  affiliates.....................   276,515         44,542         619,256        (860,624)        79,689
Other noncurrent assets..........    28,966          1,332             260              --         30,558
                                   --------       --------       ---------       ---------       --------
  Total assets...................  $920,712       $159,047       $ 786,862       $(870,733)      $995,888
                                   ========       ========       =========       =========       ========
Current liabilities
  Accounts payable...............  $    872       $    341       $  13,633       $  (4,033)      $ 10,813
  Accrued interest...............     7,747            366              --              --          8,113
  Other current liabilities......     3,756             --           5,362              (1)         9,117
                                   --------       --------       ---------       ---------       --------
     Total current liabilities...    12,375            707          18,995          (4,034)        28,043
Long-term debt...................   513,000         70,000              --              --        583,000
Other noncurrent liabilities.....        --             --          12,250            (295)        11,955
Minority interest................        --             --          (2,551)            161         (2,390)
Partners' capital................   395,337         88,340         758,168        (866,565)       375,280
                                   --------       --------       ---------       ---------       --------
  Total liabilities and partners'
     capital.....................  $920,712       $159,047       $ 786,862       $(870,733)      $995,888
                                   ========       ========       =========       =========       ========
</TABLE>

                     CONDENSED CONSOLIDATING BALANCE SHEETS
                               DECEMBER 31, 2000

<TABLE>
<CAPTION>
                                               NON-GUARANTOR     GUARANTOR     CONSOLIDATING   CONSOLIDATED
                                    ISSUER    SUBSIDIARIES(1)   SUBSIDIARIES   ELIMINATIONS       TOTAL
                                   --------   ---------------   ------------   -------------   ------------
                                                                (IN THOUSANDS)
<S>                                <C>        <C>               <C>            <C>             <C>
Current assets
  Cash and cash equivalents......  $ 18,865       $  1,416       $      --       $      --       $ 20,281
  Accounts receivable, net.......   618,652           (875)       (581,702)         (3,341)        32,734
  Other current assets...........       390             --             243              --            633
                                   --------       --------       ---------       ---------       --------
     Total current assets........   637,907            541        (581,459)         (3,341)        53,648
Property, plant and equipment,
  net............................     1,798         88,356         541,541              --        631,695
Investments in unconsolidated
  affiliates.....................   156,176         44,542         629,404        (647,388)       182,734
Other noncurrent assets..........     9,498          1,445             239              --         11,182
                                   --------       --------       ---------       ---------       --------
  Total assets...................  $805,379       $134,884       $ 589,725       $(650,729)      $879,259
                                   ========       ========       =========       =========       ========
Current liabilities
  Accounts payable...............  $ (1,507)      $    508       $  18,765       $  (3,341)      $ 14,425
  Accrued interest...............     2,815            292              --              --          3,107
  Other current liabilities......        --             --           2,171              --          2,171
                                   --------       --------       ---------       ---------       --------
     Total current liabilities...     1,308            800          20,936          (3,341)        19,703
Long-term debt...................   493,000         45,000              --              --        538,000
Other noncurrent liabilities.....        --             --          12,851              --         12,851
Minority interest................        --             --          (2,366)             --         (2,366)
Partners' capital................   311,071         89,084         558,304        (647,388)       311,071
                                   --------       --------       ---------       ---------       --------
  Total liabilities and partners'
     capital.....................  $805,379       $134,884       $ 589,725       $(650,729)      $879,259
                                   ========       ========       =========       =========       ========
</TABLE>

---------------

(1) This represents Argo and Argo I, which were formed in August 2000.

                                        12
<PAGE>   14

                CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOW
                      FOR THE QUARTER ENDED MARCH 31, 2001

<TABLE>
<CAPTION>
                                                    NON-GUARANTOR     GUARANTOR     CONSOLIDATING   CONSOLIDATED
                                         ISSUER    SUBSIDIARIES(1)   SUBSIDIARIES   ELIMINATIONS       TOTAL
                                        --------   ---------------   ------------   -------------   ------------
                                                                     (IN THOUSANDS)
<S>                                     <C>        <C>               <C>            <C>             <C>
Cash flows from operating activities
  Net income (loss)...................  $ 19,484       $   (743)      $  (5,936)      $     168      $  12,973
  Adjustments to reconcile net income
     to net cash from operating
     activities
     Depreciation, depletion and
       amortization...................       254             --           8,048              --          8,302
     Asset impairment charge..........        --             --           3,921              --          3,921
     Net loss on sales of assets......        --             --          10,381              --         10,381
     Distributed earnings of
       unconsolidated affiliates
       Loss from unconsolidated
          affiliates..................      (168)            --           4,712             168          4,712
       Distributions from
          unconsolidated affiliates...        --             --           6,922              --          6,922
  Other noncash items.................       950            113              --              --          1,063
  Working capital changes, net of
     non-cash transactions............    80,990          1,235        (104,259)           (341)       (22,375)
                                        --------       --------       ---------       ---------      ---------
          Net cash provided by (used
            in) operating
            activities................   101,510            605         (76,211)             (5)        25,899
                                        --------       --------       ---------       ---------      ---------
Cash flows from investing activities
  Additions to property, plant and
     equipment........................        --        (18,207)       (144,721)          5,953       (156,975)
  Proceeds from sales of assets.......        --             --         108,233              --        108,233
  Other...............................        --             --             140              --            140
                                        --------       --------       ---------       ---------      ---------
          Net cash provided by (used
            in) investing
            activities................        --        (18,207)        (36,348)          5,953        (48,602)
                                        --------       --------       ---------       ---------      ---------
Cash flows from financing activities
  Net proceeds from revolving credit
     facility.........................   140,620             --              --              --        140,620
  Revolving credit repayments.........  (121,000)            --              --              --       (121,000)
  Net proceeds from project
     financing........................        --         24,962              --              --         24,962
  Net proceeds from issuance of common
     units............................    73,358             --              --              --         73,358
  Advances with affiliates............  (120,342)            --         (92,894)        213,236             --
  Distributions to partners...........    (8,576)            --         205,453        (219,184)       (22,307)
                                        --------       --------       ---------       ---------      ---------
          Net cash provided by (used
            in) financing
            activities................   (35,940)        24,962         112,559          (5,948)        95,633
                                        --------       --------       ---------       ---------      ---------
Increase in cash and cash
  equivalents.........................  $ 65,570       $  7,360       $      --       $      --         72,930
                                        ========       ========       =========       =========
Cash and cash equivalents
  Beginning of period.................                                                                  20,281
                                                                                                     ---------
  End of period.......................                                                               $  93,211
                                                                                                     =========
</TABLE>

---------------

(1) This represents Argo and Argo I, which were formed in August 2000.

                                        13
<PAGE>   15

                CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOW
                      FOR THE QUARTER ENDED MARCH 31, 2000

<TABLE>
<CAPTION>
                                                    NON-GUARANTOR     GUARANTOR     CONSOLIDATING   CONSOLIDATED
                                         ISSUER    SUBSIDIARIES(1)   SUBSIDIARIES   ELIMINATIONS       TOTAL
                                        --------   ---------------   ------------   -------------   ------------
                                                                     (IN THOUSANDS)
<S>                                     <C>        <C>               <C>            <C>             <C>
Cash flows from operating activities
  Net income (loss)...................  $(14,492)        $--           $ 16,431       $     --        $  1,939
  Adjustments to reconcile net income
     to net cash from operating
     activities
     Depreciation, depletion and
       amortization...................        55          --              6,421             --           6,476
     Distributed earnings of
       unconsolidated affiliates
       Earnings from unconsolidated
          affiliates..................        --          --             (3,850)            --          (3,850)
       Distributions from
          unconsolidated affiliates...        --          --              8,740             --           8,740
  Other noncash items.................       705          --                 (4)            --             701
  Working capital changes, net of
     non-cash transactions............     4,088          --              2,359             --           6,447
                                        --------         ---           --------       --------        --------
          Net cash provided by (used
            in) operating
            activities................    (9,644)         --             30,097             --          20,453
                                        --------         ---           --------       --------        --------
Cash flows from investing activities
  Additions to property, plant and
     equipment........................      (140)         --             (5,946)            --          (6,086)
  Proceeds from sale of equity
     investments......................        --          --             (3,015)            --          (3,015)
  Cash paid for acquisitions, net of
     cash acquired....................        --          --            (26,476)            --         (26,476)
  Other...............................      (280)         --                 --             --            (280)
                                        --------         ---           --------       --------        --------
          Net cash used in investing
            activities................      (420)         --            (35,437)            --         (35,857)
                                        --------         ---           --------       --------        --------
Cash flows from financing activities
  Net proceeds from revolving credit
     facility.........................    43,000          --                 --             --          43,000
  Revolving credit repayments.........    (6,000)         --                 --             --          (6,000)
  Advances with affiliates............   (23,664)         --                 --         23,664              --
  Distributions to partners...........     1,152          --              4,860        (23,664)        (17,652)
                                        --------         ---           --------       --------        --------
          Net cash provided by
            financing activities......    14,488          --              4,860             --          19,348
                                        --------         ---           --------       --------        --------
Increase in cash and cash
  equivalents.........................  $  4,424         $--           $   (480)      $     --           3,944
                                        ========         ===           ========       ========
Cash and cash equivalents
  Beginning of period.................                                                                   4,202
                                                                                                      --------
  End of period.......................                                                                $  8,146
                                                                                                      ========
</TABLE>

---------------

(1) This represents Argo and Argo I which were formed in August 2000.

                                        14
<PAGE>   16

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

     The information contained in Item 2 updates, and you should read it in
conjunction with, information disclosed in Part II, Items 7, 7A and 8, in our
Annual Report on Form 10-K for the year ended December 31, 2000, in addition to
the interim financial statements and notes presented in Item 1 of this Quarterly
Report on Form 10-Q.

                              RECENT DEVELOPMENTS

EPN TEXAS

     In February 2001, we purchased EPN Texas from a subsidiary of El Paso
Corporation for approximately $133 million. We funded the acquisition of these
assets by borrowing from our revolving credit facility. These assets include
more than 600 miles of NGL gathering and transportation pipelines. The NGL
pipeline system gathers and transports unfractionated and fractionated products.
We also acquired three fractionation plants with a capacity of approximately 96
MBbls/d. These plants fractionate NGLs into ethane, propane, and butane products
which are used by refineries and petrochemical plants along the Texas Gulf
Coast.

GULF OF MEXICO ASSETS

     In accordance with an FTC order related to El Paso Corporation's merger
with The Coastal Corporation, we, along with Deepwater Holdings, agreed to sell
several of our offshore Gulf of Mexico assets to third parties in January 2001.
Total consideration paid for these assets was approximately $158 million
consisting of approximately $108 million for the assets we sold and
approximately $50 million for the assets Deepwater Holdings sold. The offshore
assets sold include interests in Stingray, Nautilus, Manta Ray Offshore, Nemo,
Tarpon and the Green Canyon pipeline assets, as well as interests in two
offshore platforms and one dehydration facility. We recognized net losses from
the asset sales of approximately $10.4 million, and Deepwater Holdings
recognized losses of approximately $14.9 million. Our share of Deepwater
Holdings' losses was $10 million, which has been reflected in earnings (loss)
from unconsolidated affiliates in the accompanying statements of operations.
Also related to the same FTC order, Deepwater Holdings sold its interest in UTOS
in April 2001. The proceeds from this sale were approximately $4 million and
Deepwater Holdings recognized a loss of $6.1 million, of which $4.2 million
represents our share.

     As additional consideration for the above transactions, El Paso Corporation
will make payments to us totaling $29 million. These payments will be made in
quarterly installments of $2.25 million for the next three years and $2 million
in the first quarter of 2004. From this additional consideration, we realized
income of approximately $25.4 million, which has been reflected in other income
in the accompanying statements of operations.

                                        15
<PAGE>   17

                                SEGMENT RESULTS

     As a result of our acquisition of EPN Texas in February 2001, we began
providing NGL transportation and fractionation services and have shown these
activities as a separate segment called Liquid Transportation and Fractionation.
This segment also includes the liquid transportation services of the Allegheny
and Poseidon oil pipelines which were previously reflected in the Gathering,
Transportation and Platforms segment. Accordingly, to the extent practicable, we
have restated the prior period to conform to the current business segment
presentation. The restated results of operations for the quarter ended March 31,
2000, are not necessarily indicative of the results which would have been
achieved had the revised business structure been in effect during the period.

     Each of our segments are business units that offer different services and
products. They are managed separately, as each requires different technology and
marketing strategies. The following table presents EBIT by segment and in total
for each of the quarters ended March 31:

<TABLE>
<CAPTION>
                                                                2001         2000
                                                              --------      -------
                                                                 (IN THOUSANDS)
<S>                                                           <C>           <C>
EARNINGS BEFORE INTEREST EXPENSE AND INCOME TAXES
Gathering, transportation and platforms.....................  $(14,290)     $12,426
Liquid transportation and fractionation.....................     7,033        2,168
Natural gas storage.........................................     2,513           --
Oil and natural gas production..............................     3,906       (1,294)
                                                              --------      -------
  Segment EBIT..............................................      (838)      13,300
Non-segment activity, net...................................    25,335           26
                                                              --------      -------
  Consolidated EBIT.........................................  $ 24,497      $13,326
                                                              ========      =======
</TABLE>

  EBIT variances are discussed in the segment results below.

GATHERING, TRANSPORTATION AND PLATFORMS

<TABLE>
<CAPTION>
                                                                 QUARTER ENDED
                                                                   MARCH 31,
                                                              -------------------
                                                                2001       2000
                                                              --------    -------
                                                                (IN THOUSANDS)
<S>                                                           <C>         <C>
Gathering and transportation................................  $  6,470    $ 8,774
Platform services...........................................     7,032      6,019
Natural gas sales...........................................    24,605         --
                                                              --------    -------
  Total operating revenues..................................    38,107     14,793
Purchased natural gas costs.................................   (22,971)        --
Operating expenses..........................................   (10,373)    (5,048)
Other income (loss).........................................   (19,053)     2,681
                                                              --------    -------
  EBIT......................................................  $(14,290)   $12,426
                                                              ========    =======
</TABLE>

     Gathering and transportation revenues for the quarter ended March 31, 2001,
were $2.3 million lower than the same period in 2000 primarily due to the sale
of Tarpon and the Green Canyon pipeline assets in January 2001. Also
contributing to the decrease were slightly lower volumes from the Viosca Knoll
system. Natural gas sales revenues for the quarter ended March 31, 2001, were
$24.6 million which resulted from the purchase of the El Paso Intrastate-Alabama
(EPIA) system in March 2000. In addition to providing transportation services,
EPIA provides marketing services through the purchase and resale of natural gas.
EPIA buys natural gas from regional producers and others, and sells natural gas
to local distribution companies and others. The revenue from the sale of natural
gas is reflected above as "natural gas sales" and the cost of natural gas
acquired for resale is reflected as "purchased natural gas costs."

     Operating expenses for the quarter ended March 31, 2001, were $5.3 million
higher than the same period in 2000 primarily due to the impairment of the Manta
Ray pipeline in January 2001.

                                        16
<PAGE>   18

     Other income (loss) for the quarter ended March 31, 2001, was $21.7 million
lower than the same period in 2000 primarily due to lower earnings from
unconsolidated affiliates and net losses recognized on the sales of assets.
Earnings from unconsolidated affiliates were $11.5 million lower primarily due
to our share of the losses recognized by Deepwater Holdings' sale of Stingray
and the West Cameron dehydration facility in January 2001. Net losses on sales
of assets were $10.4 million due to the sales of our interests in Nautilus,
Manta Ray Offshore, Nemo, Tarpon and the Green Canyon pipeline assets, as well
as our interests in two offshore platforms in January 2001.

LIQUID TRANSPORTATION AND FRACTIONATION

<TABLE>
<CAPTION>
                                                                QUARTER ENDED
                                                                  MARCH 31,
                                                              ------------------
                                                               2001        2000
                                                              -------     ------
                                                                (IN THOUSANDS)
<S>                                                           <C>         <C>
Liquid transportation and fractionation revenue.............  $ 4,271     $1,531
Operating expenses..........................................   (1,331)      (533)
Other income................................................    4,093      1,170
                                                              -------     ------
  EBIT......................................................  $ 7,033     $2,168
                                                              =======     ======
</TABLE>

     For the quarter ended March 31, 2001, operating revenues were $2.7 million
higher and operating expenses were $0.8 million higher than the same period in
2000, primarily as a result of the purchase of EPN Texas in February 2001.

     Other income for the quarter ended March 31, 2001, was $2.9 million higher
than the same period in 2000 primarily due to an increase in earnings from
unconsolidated affiliates attributable to higher earnings from Poseidon.
Earnings from Poseidon in the first quarter of 2000 were unfavorably impacted by
the pipeline rupture in January 2000.

NATURAL GAS STORAGE

<TABLE>
<CAPTION>
                                                                 QUARTER ENDED
                                                                   MARCH 31,
                                                              --------------------
                                                               2001         2000
                                                              -------      -------
                                                                 (IN THOUSANDS)
<S>                                                           <C>          <C>
Natural gas storage revenue.................................  $ 4,980      $    --
Operating expenses..........................................   (2,467)          --
                                                              -------      -------
  EBIT......................................................  $ 2,513      $    --
                                                              =======      =======
</TABLE>

     In August 2000, we acquired the Crystal natural gas storage businesses. For
the quarter ended March 31, 2001, the revenues from these businesses consisted
primarily of fixed reservation fees for natural gas storage capacity. Natural
gas storage capacity revenues are recognized and due during the month in which
capacity is reserved by the customer, regardless of the amount of capacity
actually used. Operating expenses consist of management and operating fees and
depreciation on the storage facilities.

                                        17
<PAGE>   19

OIL AND NATURAL GAS PRODUCTION

<TABLE>
<CAPTION>
                                                                 QUARTER ENDED
                                                                   MARCH 31,
                                                              --------------------
                                                               2001         2000
                                                              -------      -------
                                                                 (IN THOUSANDS,
                                                                EXCEPT VOLUMES)
<S>                                                           <C>          <C>
Natural gas.................................................  $ 8,339      $ 4,518
Oil, condensate, and liquids................................    2,116        1,274
                                                              -------      -------
  Total operating revenues..................................   10,455        5,792
Operating expenses..........................................   (6,549)      (7,086)
                                                              -------      -------
  EBIT......................................................  $ 3,906      $(1,294)
                                                              =======      =======
Volumes
  Natural gas sales (MMcf)..................................    1,137        1,887
                                                              =======      =======
  Oil, condensate, and liquid sales (MBbls).................       80           59
                                                              =======      =======
Weighted average realized prices
  Natural gas ($/Mcf).......................................  $  7.33      $  2.36
                                                              =======      =======
  Oil, condensate, and liquids ($/Bbl)......................  $ 26.40      $ 20.74
                                                              =======      =======
</TABLE>

     Oil and natural gas operating revenues for the quarter ended March 31,
2001, were $4.7 million higher compared to the same period in 2000. The increase
is a result of higher realized oil and natural gas prices and an increase in oil
production. Oil production in the first quarter of 2000 was lowered by the shut
in of Garden Banks Blocks 72 and 117 due to the Poseidon pipeline rupture. The
increase in 2001 was partially offset by a decrease in natural gas production
due to normal depletion of existing reserves.

     Operating expenses for the quarter ended March 31, 2001, were approximately
$0.5 million lower than in the same period in 2000 primarily due to lower
depletion from oil and natural gas production.

NON-SEGMENT ACTIVITY, NET

     Non-segment activity, net of $25.3 million for the quarter ended March 31,
2001, related to other income recognized from consideration received from El
Paso Corporation in connection with the sale of our Gulf of Mexico assets.

                        LIQUIDITY AND CAPITAL RESOURCES

CASH FROM OPERATING ACTIVITIES

     Net cash provided by operating activities was $25.9 million for the quarter
ended March 31, 2001, compared to $20.5 million for the same period in 2000. The
increase was primarily associated with higher earnings, partially offset by
lower distributions from unconsolidated affiliates and higher interest payments
in 2001, as well as other working capital changes.

CASH FROM INVESTING ACTIVITIES

     Net cash used in investing activities was approximately $48.6 million for
the quarter ended March 31, 2001, compared to $35.9 million for the same period
in 2000. The increase was primarily due to the purchase of EPN Texas and
expenditures related to our expansion of the Petal natural gas storage facility
and the Prince tension leg platform construction, partially offset by proceeds
from the sale of some of our Gulf of Mexico assets in January 2001.

                                        18
<PAGE>   20

CASH FROM FINANCING ACTIVITIES

     Net cash provided by financing activities was approximately $95.6 million
for the quarter ended March 31, 2001, compared to $19.3 million for the same
period in 2000. In the first quarter of 2001, we received net proceeds of
approximately $45 million from borrowings under our revolving credit facility
and from a project finance loan. In addition, we issued 2,250,000 common units
in March 2001 in a public offering and 242,500 common units related to options
exercised for net proceeds of approximately $73 million. These increases were
partially offset by distributions to our partners of approximately $22 million.

     We expect that future funding for capital expenditures, acquisitions, and
other investing activities and for long-term debt retirements, distributions,
and other financing activities will be provided by internally generated funds,
available capacity under existing credit facilities, and the issuance of
long-term debt or equity.

LIQUIDITY

     For a discussion of our financing arrangements and transactions, see Part
I, Financial Information, Note 5, which is incorporated herein by reference.

COMMITMENTS AND CONTINGENCIES

     See Part I, Financial Information, Note 6, which is incorporated herein by
reference.

                                        19
<PAGE>   21

                         CAUTIONARY STATEMENT REGARDING
                           FORWARD-LOOKING STATEMENTS

     We have made statements in this document that constitute forward-looking
statements, as that term is defined in the Private Securities Litigation Reform
Act of 1995. These statements are subject to risks and uncertainties.
Forward-looking statements include information concerning possible or assumed
future results of operations. These statements may relate to information or
assumptions about:

     - earnings per unit;

     - capital and other expenditures;

     - cash distributions;

     - financing plans;

     - capital structure;

     - cash flow;

     - pending legal proceedings and claims, including environmental matters;

     - future economic performance;

     - operating income;

     - cost savings;

     - management's plans; and

     - goals and objectives for future operations.

     Important factors that could cause actual results to differ materially from
estimates or projections contained in forward-looking statements include, among
others, the following:

     - the increasing competition within our industry;

     - the timing and extent of changes in commodity prices for natural gas and
       oil;

     - the uncertainties associated with customer contract expirations on our
       pipeline systems; and

     - the conditions of equity and other capital markets.

     These risk factors are more fully described in our other filings with the
Securities and Exchange Commission, including our Annual Report on Form 10-K for
the year ended December 31, 2000.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     There are no material changes in our quantitative and qualitative
disclosures about market risks from those reported in our Annual Report on Form
10-K for the year ended December 31, 2000.

                                        20
<PAGE>   22

                          PART II -- OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

     See Part I, Financial Information, Note 6, which is incorporated herein by
reference.

ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS

     None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

     None.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     None.

ITEM 5. OTHER INFORMATION

     None.

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

     (a) Exhibits

     None.

     (b) Report on Form 8-K

     We filed a Current Report on Form 8-K, dated January 29, 2001, announcing
the divestiture of various Gulf of Mexico assets.

     We filed a Current Report on Form 8-K/A dated February 13, 2001, providing
pro forma financial statements relating to the divestiture of various Gulf of
Mexico assets.

     We filed a Current Report on Form 8-K, dated March 6, 2001, to report the
Second Amendment and Restatement of our Agreement of Limited Partnership,
effective as of August 31, 2000.

     We filed a Current Report on Form 8-K dated March 15, 2001, announcing the
purchase of natural gas liquids transportation and fractionation assets.

     We filed a Current Report on Form 8-K dated March 21, 2001, providing
additional risk factors relating to our new fractionation and storage
businesses.

     We filed a Current Report on Form 8-K dated March 27, 2001, providing the
underwriting agreement for our March 2001 prospectus supplement.

                                        21
<PAGE>   23

                                   SIGNATURES

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

                                          EL PASO ENERGY PARTNERS, L.P.

                                          By: EL PASO ENERGY PARTNERS COMPANY,
                                            its General Partner

Date: May 14, 2001                        By:      /s/ KEITH B. FORMAN
                                            ------------------------------------
                                                      Keith B. Forman
                                             Vice President and Chief Financial
                                                           Officer

Date: May 14, 2001                        By:      /s/ D. MARK LELAND
                                            ------------------------------------
                                                       D. Mark Leland
                                            Senior Vice President and Controller
                                               (Principal Accounting Officer)

                                        22