##### Table of Contents



UNITED STATESSECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended September 30, 2007
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from to .
 Commission file number: 1-32610
 ENTERPRISE GP HOLDINGS L.P.
  Delaware
(State or Other Jurisdiction of 
Incorporation or Organization)
    
    13-4297064
(I.R.S. Employer Identification No.)
 1100 Louisiana, 10th Floor
 Houston, Texas 77002
  (713) 381-6500
   þ o
  o þ o
  o þ




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##### 



ENTERPRISE GP HOLDINGS L.P.
TABLE OF CONTENTS
  
 Page No.PART I. FINANCIAL INFORMATION.Item 1.
    
    Financial Statements.
    
    
    2Unaudited Condensed Consolidated Balance Sheets
    
    
    2Unaudited Condensed Statements of Consolidated Operations
    
    
    3Unaudited Condensed Statements of Consolidated Comprehensive Income
    
    
    4Unaudited Condensed Statements of Consolidated Cash Flows
    
    
    5Unaudited Condensed Statements of Consolidated Partners Equity
    
    
    6Notes to Unaudited Condensed Consolidated Financial Statements:
    
    
    71. Partnership Organization and Basis of Financial Statement Presentation
    
    
    72. General Accounting Policies and Related Matters
    
    
    103. Parent Company Financial Information
    
    
    154. Business Segments
    
    
    215. Accounting for Unit-Based Awards
    
    
    246. Financial Instruments
    
    
    317. Inventories
    
    
    348. Property, Plant and Equipment
    
    
    359. Investments in and Advances to Unconsolidated Affiliates
    
    
    3710. Intangible Assets and Goodwill
    
    
    4011. Debt Obligations
    
    
    4212. Partners Equity and Distributions
    
    
    4813. Related Party Transactions
    
    
    5014. Earnings Per Unit
    
    
    5215. Commitments and Contingencies
    
    
    5316. Significant Risks and Uncertainties  Weather-Related Risks
    
    
    5717. Supplemental Cash Flow Information
    
    
    5818. Subsequent Events
    
    
    59Item 2.
    
    Managements Discussion and Analysis of Financial Condition
and Results of Operations.
    
    
    60Item 3.
    
    Quantitative and Qualitative Disclosures about Market Risk.
    
    
    80Item 4.
    
    Controls and Procedures.
    
    
    83PART II. OTHER INFORMATION.Item 1.
    
    Legal Proceedings.
    
    
    83Item 1A.
    
    Risk Factors.
    
    
    83Item 2.
    
    Unregistered Sales of Equity Securities and Use of Proceeds.
    
    
    86Item 3.
    
    Defaults upon Senior Securities.
    
    
    86Item 4.
    
    Submission of Matters to a Vote of Security Holders.
    
    
    86Item 5.
    
    Other Information.
    
    
    86Item 6.
    
    Exhibits.
    
    
    86Signatures
    
    
    
    
    88Third Amended and Restated Limited Liability Company AgreementCertification Pursuant to Section 302Certification Pursuant to Section 302Certification Pursuant to Section 1350Certification Pursuant to Section 1350
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PART I. FINANCIAL INFORMATION.
 
 Item 1. Financial Statements .
 ENTERPRISE GP HOLDINGS L.P.
 
 UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
 (See Note 3 for Parent Company Financial Information)
 (Dollars in thousands)
 September 30,
    
    
    December 31,2007
    
    
    2006*ASSETSCurrent assets:Cash and cash equivalents
    
    $
    46,641
    
    
    $
    23,290Restricted cash
    
    
    66,788
    
    
    
    23,667Accounts and notes receivable  trade (net of allowance for doubtful accounts
of $22,111 at September 30, 2007 and $23,506 at December 31, 2006)
    
    
    2,726,545
    
    
    
    2,202,507Accounts receivable  related parties
    
    
    3,129
    
    
    
    2,008Inventories
    
    
    635,363
    
    
    
    489,007Prepaid and other current assets
    
    
    214,576
    
    
    
    162,758Total current assets
    
    
    3,693,042
    
    
    
    2,903,237Property, plant and equipment at cost, net
    
    
    13,739,534
    
    
    
    12,112,973Investments in and advances to unconsolidated affiliates
    
    
    2,547,287
    
    
    
    784,756Intangible assets(net of accumulated amortization of $513,770 at
September 30, 2007 and $420,800 at December 31, 2006)
    
    
    1,839,913
    
    
    
    1,938,953Goodwill
    
    
    808,073
    
    
    
    806,971Deferred tax asset
    
    
    2,453
    
    
    
    1,855Other assets
    
    
    227,578
    
    
    
    151,146Total assets
    
    $
    22,857,880
    
    
    $
    18,699,891LIABILITIES AND PARTNERS EQUITYCurrent liabilities:Accounts payable  trade
    
    $
    385,489
    
    
    $
    334,001Accounts payable  related parties
    
    
    15,437
    
    
    
    18,598Accrued product payables
    
    
    2,867,725
    
    
    
    2,172,228Accrued expenses
    
    
    57,092
    
    
    
    42,927Accrued interest
    
    
    132,867
    
    
    
    126,904Other current liabilities
    
    
    315,032
    
    
    
    270,317Total current liabilities
    
    
    3,773,642
    
    
    
    2,964,975Long-term debt(See Note 11)
    
    
    9,642,949
    
    
    
    7,053,877Deferred tax liabilities
    
    
    16,960
    
    
    
    14,375Other long-term liabilities
    
    
    114,349
    
    
    
    107,596Minority interest
    
    
    7,165,679
    
    
    
    7,118,819Commitments and contingenciesPartners equity:(see Note 12)Limited partners:Units (123,191,640 Units outstanding at September 30, 2007 and
88,884,116 Units outstanding at December 31, 2006)
    
    
    1,725,393
    
    
    
    680,922Class B Units (14,173,304 Units outstanding at December 31, 2006)
    
    
    
    
    
    
    357,082Class C Units (16,000,000 Units outstanding at September 30, 2007 and
December 31, 2006)
    
    
    380,665
    
    
    
    380,665General partner
    
    
    12
    
    
    
    14Accumulated other comprehensive income
    
    
    38,231
    
    
    
    21,566Total partners equity
    
    
    2,144,301
    
    
    
    1,440,249Total liabilities and partners equity
    
    $
    22,857,880
    
    
    $
    18,699,891
 
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##### Table of Contents



ENTERPRISE GP HOLDINGS L.P.
 
 UNAUDITED CONDENSED STATEMENTS OF CONSOLIDATED OPERATIONS
 (See Note 3 for Parent Company Financial Information)
 (Dollars in thousands, except per unit amounts)
 For the Three Months
    
    
    For the Nine MonthsEnded September 30,
    Ended September 30,2007
    2006*
    2007
    2006*Revenues:Third parties
    
    $
    6,555,424
    
    
    $
    6,333,023
    
    
    $
    18,019,727
    
    
    $
    17,854,321Related parties
    
    
    166,300
    
    
    
    118,415
    
    
    
    336,542
    
    
    
    305,046Total (see Note 4)
    
    
    6,721,724
    
    
    
    6,451,438
    
    
    
    18,356,269
    
    
    
    18,159,367Costs and expenses:Operating costs and expenses:Third parties
    
    
    6,310,960
    
    
    
    5,985,716
    
    
    
    17,089,119
    
    
    
    16,926,292Related parties
    
    
    109,198
    
    
    
    107,041
    
    
    
    326,752
    
    
    
    336,250Total
    
    
    6,420,158
    
    
    
    6,092,757
    
    
    
    17,415,871
    
    
    
    17,262,542General and administrative costs:Third parties
    
    
    9,603
    
    
    
    9,041
    
    
    
    32,566
    
    
    
    25,509Related parties
    
    
    18,222
    
    
    
    15,381
    
    
    
    64,746
    
    
    
    49,656Total
    
    
    27,825
    
    
    
    24,422
    
    
    
    97,312
    
    
    
    75,165Total costs and expenses
    
    
    6,447,983
    
    
    
    6,117,179
    
    
    
    17,513,183
    
    
    
    17,337,707Equity earnings
    
    
    6,571
    
    
    
    2,277
    
    
    
    5,128
    
    
    
    17,982Operating income
    
    
    280,312
    
    
    
    336,536
    
    
    
    848,214
    
    
    
    839,642Other income (expense):Interest expense
    
    
    (137,602
    )
    
    
    (88,533
    )
    
    
    (341,949
    )
    
    
    (247,661
    )Interest income
    
    
    3,079
    
    
    
    3,180
    
    
    
    8,840
    
    
    
    6,981Other, net
    
    
    (223
    )
    
    
    80
    
    
    
    60,312
    
    
    
    3,023Total
    
    
    (134,746
    )
    
    
    (85,273
    )
    
    
    (272,797
    )
    
    
    (237,657
    )Income before taxes and minority interest
    
    
    145,566
    
    
    
    251,263
    
    
    
    575,417
    
    
    
    601,985Provision for income taxes
    
    
    (2,056
    )
    
    
    (3,428
    )
    
    
    (9,208
    )
    
    
    (13,105
    )Minority interest
    
    
    (131,233
    )
    
    
    (210,793
    )
    
    
    (478,975
    )
    
    
    (490,332
    )Income before the cumulative effect of
change in accounting principle
    
    
    12,277
    
    
    
    37,042
    
    
    
    87,234
    
    
    
    98,548Cumulative effect of change in
accounting principle (see Note 2)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    96Net income
    
    $
    12,277
    
    
    $
    37,042
    
    
    $
    87,234
    
    
    $
    98,644Net income allocation:(see Note 14)Limited partners
    
    $
    12,276
    
    
    $
    37,038
    
    
    $
    87,225
    
    
    $
    98,634General partner
    
    $
    1
    
    
    $
    4
    
    
    $
    9
    
    
    $
    10Earnings per Unit:(see Note 14)Basic and diluted income per Unit
before change
in accounting principle
    
    $
    0.10
    
    
    $
    0.36
    
    
    $
    0.80
    
    
    $
    0.96Basic and diluted income per Unit
    
    $
    0.10
    
    
    $
    0.36
    
    
    $
    0.80
    
    
    $
    0.96
 
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ENTERPRISE GP HOLDINGS L.P.
 
 UNAUDITED CONDENSED STATEMENTS OF CONSOLIDATED
 COMPREHENSIVE INCOME
 (Dollars in thousands)
 For the Three Months
    
    
    For the Nine MonthsEnded September 30,
    
    Ended September 30,2007
    2006 *
2007
    2006 *Net income
    
    $
    12,277
    
    
    $
    37,042
    
    
    $
    87,234
    
    
    $
    98,644Other comprehensive income:Cash flow hedges:Net commodity financial instrument gains
(losses)
    
    
    (25,416
    )
    
    
    13,086
    
    
    
    (24,815
    )
    
    
    5,114Foreign currency hedge gains
    
    
    2,879
    
    
    
    
    
    
    
    2,879
    
    
    
    Net interest rate financial instrument
gains (losses)
    
    
    (3,018
    )
    
    
    (2,222
    )
    
    
    38,552
    
    
    
    (584
    )Less: Amortization of cash flow financing
hedges
    
    
    (1,398
    )
    
    
    (1,065
    )
    
    
    (3,402
    )
    
    
    (3,158
    )Total cash flow hedges
    
    
    (26,953
    )
    
    
    9,779
    
    
    
    13,214
    
    
    
    1,372Foreign currency translation adjustment
    
    
    1,832
    
    
    
    
    
    
    
    2,381
    
    
    
    Total other comprehensive income (loss)
    
    
    (25,121
    )
    
    
    9,779
    
    
    
    15,595
    
    
    
    1,372Comprehensive income (loss)
    
    $
    (12,844
    )
    
    $
    46,841
    
    
    $
    102,829
    
    
    $
    100,016
 
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ENTERPRISE GP HOLDINGS L.P.
 
 UNAUDITED CONDENSED STATEMENTS OF CONSOLIDATED CASH FLOWS
 (See Note 3 for Parent Company Financial Information)
 (Dollars in thousands)
 For the Nine MonthsEnded September 30,2007


2006*Operating activities:Net income
    
    $
    87,234
    
    
    $
    98,644Adjustments to reconcile net income to net cash
flows provided by operating activities:Depreciation, amortization and accretion in operating costs and expenses
    
    
    471,344
    
    
    
    413,012Depreciation and amortization in general and administrative costs
    
    
    9,194
    
    
    
    5,559Amortization in interest expense
    
    
    1,469
    
    
    
    (423
    )Equity earnings
    
    
    (5,128
    )
    
    
    (17,982
    )Distributions received from unconsolidated affiliates
    
    
    82,603
    
    
    
    53,631Cumulative effect of change in accounting principle
    
    
    
    
    
    
    (96
    )Operating lease expense paid by EPCO, Inc.
    
    
    1,579
    
    
    
    1,584Minority interest
    
    
    478,975
    
    
    
    490,332Unamortized debt issue costs
    
    
    566
    
    
    
    Gain on sale of assets
    
    
    (67,359
    )
    
    
    (4,812
    )Deferred income tax expense
    
    
    4,885
    
    
    
    13,034Changes in fair market value of financial instruments
    
    
    4,712
    
    
    
    39Net effect of changes in operating accounts (see Note 17)
    
    
    66,521
    
    
    
    179,083Net cash flows provided by operating activities
    
    
    1,136,595
    
    
    
    1,231,605Investing activities:Capital expenditures
    
    
    (2,102,103
    )
    
    
    (1,311,528
    )Contributions in aid of construction costs
    
    
    53,429
    
    
    
    63,670Proceeds from sale of assets
    
    
    159,032
    
    
    
    4,793Increase in restricted cash
    
    
    (82,413
    )
    
    
    (6,203
    )Cash used for business combinations
    
    
    (3,285
    )
    
    
    (155,948
    )Investments in unconsolidated affiliates
    
    
    (1,879,721
    )
    
    
    (22,659
    )Advances (to) from unconsolidated affiliates
    
    
    (18,946
    )
    
    
    10,288Cash used in investing activities
    
    
    (3,874,007
    )
    
    
    (1,417,587
    )Financing activities:Borrowings under debt agreements
    
    
    8,953,625
    
    
    
    3,196,534Repayments of debt
    
    
    (6,372,131
    )
    
    
    (3,160,650
    )Debt issuance costs
    
    
    (26,782
    )
    
    
    (1,019
    )Distributions paid to partners
    
    
    (110,376
    )
    
    
    (78,670
    )Proceeds
from issuance of our Units, net
    
    
    739,866
    
    
    
    Repurchase of unit-based awards from former officer
    
    
    (1,568
    )
    
    
    Settlement of cash flow hedging financial instruments
    
    
    49,103
    
    
    
    Distributions paid to minority interests
    
    
    (796,127
    )
    
    
    (692,645
    )Cash distribution paid to former owners of TEPPCO interests
    
    
    (29,760
    )
    
    
    (42,898
    )Contributions from minority interests
    
    
    354,566
    
    
    
    1,040,727Cash provided by financing activities
    
    
    2,760,416
    
    
    
    261,379Effect of exchange rate changes on cash flows
    
    
    347
    
    
    
    Net change in cash and cash equivalents
    
    
    23,004
    
    
    
    75,397Cash and cash equivalents, January 1
    
    
    23,290
    
    
    
    42,769Cash and cash equivalents, September 30
    
    $
    46,641
    
    
    $
    118,166
 
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ENTERPRISE GP HOLDINGS L.P.
 
 UNAUDITED CONDENSED
STATEMENTS OF CONSOLIDATED PARTNERS EQUITY
 (See Note 12 for Unit History and Detail of Changes in Limited Partners Equity)
(Dollars in thousands)
 Limited
    
    GeneralPartners
    
    Partner
    
    AOCI
    
    Total|
    
    | | |Balance, December 31, 2006 *
    
    $
    1,418,669
    
    
    $
    14
    
    
    $
    21,566
    
    
    $
    1,440,249Net income
    
    
    87,225
    
    
    
    9
    
    
    
    
    
    
    
    87,234Operating leases paid by EPCO, Inc.
    
    
    80
    
    
    
    
    
    
    
    
    
    
    
    80Cash distributions to partners
    
    
    (110,365
    )
    
    
    (11
    )
    
    
    
    
    
    
    (110,376
    )Cash distributions to former owners of TEPPCO interests
    
    
    (29,760
    )
    
    
    
    
    
    
    
    
    
    
    (29,760
    )Proceeds
from issuance of our Units, net
    
    
    739,866
    
    
    
    
    
    
    
    
    
    
    
    739,866Change in funded status of pension and
postretirement plans, net of tax
    
    
    
    
    
    
    
    
    
    
    1,070
    
    
    
    1,070Amortization of equity awards
    
    
    343
    
    
    
    
    
    
    
    
    
    
    
    343Foreign currency translation adjustment
    
    
    
    
    
    
    
    
    
    
    2,381
    
    
    
    2,381Cash flow hedges
    
    
    
    
    
    
    
    
    
    
    13,214
    
    
    
    13,214Balance, September 30, 2007
    
    $
    2,106,058
    
    
    $
    12
    
    
    $
    38,231
    
    
    $
    2,144,301
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ENTERPRISE GP HOLDINGS L.P.
 
 NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
 
 Note 1. Partnership Organization and Basis of Financial Statement Presentation
 Partnership Organization
        7




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Basis of Financial Statement Presentation
      Basis of Financial Information pertaining to EPGP and Enterprise Products Partners
 8




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Basis of Financial Information pertaining to TEPPCO GP and TEPPCO
    §
    
    Ownership of 100% of the membership interests in TEPPCO GP and associated TEPPCO IDRs
for all periods presented. TEPPCO GP is entitled to 2% of the quarterly cash
distributions paid by TEPPCO and its percentage interest in TEPPCOs quarterly cash
distributions is increased through its ownership of the associated TEPPCO IDRs, after
certain specified target levels of distribution rates are met by TEPPCO. Currently,
TEPPCO GPs quarterly general partner and associated incentive distribution thresholds are
as follows:
 §
    
    2% of quarterly cash distributions up to $0.275 per unit paid by TEPPCO;§
    
    15% of quarterly cash distributions from $0.276 per unit up to $0.325 per unit
paid by TEPPCO; and§
    
    25% of quarterly cash distributions that exceed $0.325 per unit paid by TEPPCO.
   9




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§
    
    Ownership of 4,400,000 common units of TEPPCO since the date of issuance to affiliates
of EPCO in December 2006.
  Basis of Financial Information pertaining to ETEGP and Energy Transfer Equity
 Revised Business Segments
  
 Note 2. General Accounting Policies and Related Matters
 Consolidation Policy
   10




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Cumulative Effect of Change in Accounting Principle
  Employee Benefit Plans
   Defined Contribution Plan.
 Pension and Postretirement Benefit Plans .
 Environmental Costs
  11




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Estimates
  Income Taxes
   Minority Interest
  12




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September 30,
    
    December 31,2007
    
    2006Limited partners of Enterprise Products Partners:Third-party owners of Enterprise Products Partners (1)
    
    $
    5,048,968
    
    
    $
    5,219,349Related party owners of Enterprise Products Partners (2)
    
    
    303,837
    
    
    
    395,591Limited partners of Duncan Energy Partners:Third-party owners of Duncan Energy Partners (3)
    
    
    290,195
    
    
    
    Related party former owners of TEPPCO GP (4)
    
    
    
    
    
    
    (13,098
    )Limited partners of TEPPCO:Third-party owners of TEPPCO (1)
    
    
    1,390,873
    
    
    
    1,384,557Related party owners of TEPPCO (2)
    
    
    (8,798
    )
    
    
    3,290Joint venture partners (5)
    
    
    140,604
    
    
    
    129,130Total minority interest on consolidated balance sheet
    
    $
    7,165,679
    
    
    $
    7,118,819
 
 (1)
    
    Consists of non-affiliate public unitholders of Enterprise Products Partners and TEPPCO.(2)
    
    Consists of unitholders of Enterprise Products Partners and TEPPCO that are related party affiliates of the parent company. This group is primarily
comprised of EPCO and certain of its private company consolidated subsidiaries.(3)
    
    Consists of non-affiliate public unitholders of Duncan Energy Partners. On February 5, 2007, Duncan Energy Partners completed its initial public
offering of 14,950,000 common units. A wholly owned operating subsidiary of Enterprise Products Partners owns the general partner of Duncan Energy
Partners; therefore, Enterprise Products Partners consolidates the financial statements of Duncan Energy Partners with those of its own. For financial
accounting and reporting purposes, the public owners of Duncan Energy Partners are presented as minority interest in our consolidated financial statements
effective February 1, 2007.(4)
    
    Represents ownership interests in the top 25% of TEPPCO GP incentive distribution rights held by DFI and DFIGP (see Note 1, Basis of Financial
Statement Presentation).(5)
    
    Represents third-party ownership interests in joint ventures that we consolidate, including Seminole, Dixie, Tri-States Pipeline L.L.C. (Tri-States),
Independence Hub, LLC (Independence Hub), Wilprise Pipeline Company, L.L.C. (Wilprise) and Belle Rose NGL Pipeline, L..L.C. (Belle Rose).  For the Three Months
    
    For the Nine MonthsEnded September 30,
    
    Ended September 30,2007
    
    2006
    
    2007
    
    2006Limited partners of Enterprise Products Partners
    
    $
    85,669
    
    
    $
    176,341
    
    
    $
    278,077
    
    
    $
    383,312Limited partners of Duncan Energy Partners
    
    
    3,242
    
    
    
    
    
    
    
    9,356
    
    
    
    Related party former owners of TEPPCO GP
    
    
    
    
    
    
    3,465
    
    
    
    
    
    
    
    12,253Limited partners of TEPPCO
    
    
    37,783
    
    
    
    29,048
    
    
    
    181,716
    
    
    
    90,092Joint venture partners
    
    
    4,539
    
    
    
    1,939
    
    
    
    9,826
    
    
    
    4,675Total
    
    $
    131,233
    
    
    $
    210,793
    
    
    $
    478,975
    
    
    $
    490,332
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For the Nine MonthsEnded September 30,2007
    
    2006Distributions paid to minority interests:Limited partners of Enterprise Products Partners
    
    $
    600,947
    
    
    $
    524,727Limited partners of Duncan Energy Partners
    
    
    9,628
    
    
    
    Related party former owners of TEPPCO GP
    
    
    
    
    
    
    17,718Limited partners of TEPPCO
    
    
    174,697
    
    
    
    145,558Joint venture partners
    
    
    10,855
    
    
    
    4,642Total distributions paid to minority interests
    
    $
    796,127
    
    
    $
    692,645Contributions from minority interests:Limited partners of Enterprise Products Partners
    
    $
    51,541
    
    
    $
    822,565Limited partners of Duncan Energy Partners
    
    
    290,466
    
    
    
    Limited partners of TEPPCO
    
    
    54
    
    
    
    195,071Joint venture partners
    
    
    12,505
    
    
    
    23,091Total contributions from minority interests
    
    $
    354,566
    
    
    $
    1,040,727
   Recent Accounting Developments
   14




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##### Table of Contents



Reclassifications
  
 Note 3. Parent Company Financial Information
   Investment in Enterprise Products Partners
   §
    
    2% of quarterly cash distributions up to $0.253 per unit paid by Enterprise
Products Partners;§
    
    15% of quarterly cash distributions from $0.253 per unit up to $0.3085 per unit
paid by Enterprise Products Partners; and§
    
    25% of quarterly cash distributions that exceed $0.3085 per unit paid by Enterprise
Products Partners.
  Investment in TEPPCO
  15




---



##### Table of Contents



Investment in TEPPCO (4,400,000 common units)
    
    $
    148,098Investment in TEPPCO GP (100% membership interest)
    
    
    591,636Investment in TEPPCO
    
    $
    739,734
  §
    
    2% of quarterly cash distributions up to $0.275 per unit paid by TEPPCO;§
    
    15% of quarterly cash distributions from $0.276 per unit up to $0.325 per unit paid
by TEPPCO; and§
    
    25% of quarterly cash distributions that exceed $0.325 per unit paid by TEPPCO.
   Investment in Energy Transfer Equity
    Energy Transfer Equity (38,976,090 common units)
    
    $
    1,636,996ETEGP (approximately 34.9% membership interest)
    
    
    12,338Total invested by the parent company
    
    $
    1,649,334
 16




---



##### Table of Contents



§
    
    2% of quarterly cash distributions up to $0.275 per unit paid by ETP;§
    
    15% of quarterly cash distributions from $0.275 per unit up to $0.3175 per unit
paid by ETP;§
    
    25% of quarterly cash distributions from $0.3175 per unit up to $0.4125 per unit
paid by ETP; and§
    
    50% of quarterly cash distributions that exceed $0.4125 per unit paid by ETP.
    17




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##### Table of Contents



Parent Company Statements of Cash Flows
  For the Nine MonthsEnded September 30,2007
    
    2006Operating activities:Net income
    
    $
    87,234
    
    
    $
    98,644Adjustments to reconcile net income to net cash flows
provided by operating activities:Amortization in interest expense
    
    
    3,972
    
    
    
    255Amortization of equity awards
    
    
    67
    
    
    
    21Cumulative effect of change in accounting principle
    
    
    
    
    
    
    (18
    )Amortization of fair value of debt
    
    
    1,298
    
    
    
    Equity earnings
    
    
    (139,851
    )
    
    
    (107,044
    )Cash distributions received from unconsolidated affiliates
    
    
    167,497
    
    
    
    132,492Net effect of changes in operating accounts
    
    
    9,614
    
    
    
    (4,276
    )Net cash flows provided by operating activities
    
    
    129,831
    
    
    
    120,074Investing activities:Investments in unconsolidated affiliates
    
    
    (1,650,467
    )
    
    
    (18,920
    )Cash used in investing activities
    
    
    (1,650,467
    )
    
    
    (18,920
    )Financing activities:Net borrowings under parent company credit facility
    
    
    928,000
    
    
    
    21,500Debt issuance costs
    
    
    (7,751
    )
    
    
    (1,019
    )Proceeds
from issuance of our Units, net
    
    
    739,866
    
    
    
    Cash distribution paid by former owners of TEPPCO interests
    
    
    (29,760
    )
    
    
    (42,898
    )Distributions paid to partners
    
    
    (110,376
    )
    
    
    (78,670
    )Cash provided by (used in) financing activities
    
    
    1,519,979
    
    
    
    (101,087
    )Net change in cash and cash equivalents
    
    
    (657
    )
    
    
    67Cash and cash equivalents, January 1
    
    
    783
    
    
    
    508Cash and cash equivalents, September 30
    
    $
    126
    
    
    $
    575
   18




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##### Table of Contents



For the Nine MonthsEnded September 30,2007
    
    2006Cash distributions from investees:Investment in Enterprise Products Partners (EPD):From 13,454,498 common units of EPD
    
    $
    19,173
    
    
    $
    17,962From 2% general partner interest in EPD
    
    
    12,597
    
    
    
    11,041From general partner incentive distribution rights in distributions of EPD
    
    
    76,266
    
    
    
    60,591Investment in TEPPCO:From 4,400,000 common units of TEPPCO
    
    
    8,998
    
    
    
    8,045From 2% general partner interest in TEPPCO
    
    
    3,748
    
    
    
    2,971From general partner incentive distribution rights in distributions of TEPPCO
    
    
    32,106
    
    
    
    31,882Investment in Energy Transfer Equity:From 38,976,090 common units of Energy Transfer Equity
    
    
    14,519
    
    
    
    From 34.9% general partner interest in Energy Transfer Equity
    
    
    90
    
    
    
    Total cash distributions from unconsolidated affiliates
    
    $
    167,497
    
    
    $
    132,492Distributions by the parent company:EPCO and affiliates
    
    $
    89,813
    
    
    $
    68,097Public
    
    
    20,552
    
    
    
    10,565General partner interest
    
    
    11
    
    
    
    8Total distributions by the parent company
    
    $
    110,376
    
    
    $
    78,670
 Parent Company Balance Sheets
  September 30,
    
    December 31,2007
    
    2006ASSETSCurrent assets
    
    $
    4,525
    
    
    $
    2,928Investments:Investment in Enterprise Products Partners
    
    
    827,064
    
    
    
    840,933Investment in TEPPCO
    
    
    740,855
    
    
    
    730,823Investment in Energy Transfer Equity
    
    
    1,634,917
    
    
    
    Total investments
    
    
    3,202,836
    
    
    
    1,571,756Other assets
    
    
    1,070
    
    
    
    340Total assets
    
    $
    3,208,431
    
    
    $
    1,575,024LIABILITIES AND PARTNERS EQUITYCurrent liabilities
    
    $
    9,500
    
    
    $
    1,023Long term debt(see Note 11)
    
    
    1,083,000
    
    
    
    155,000Other long term liabilities
    
    
    2,732
    
    
    
    Partners equity
    
    
    2,113,199
    
    
    
    1,419,001Total liabilities and partners equity
    
    $
    3,208,431
    
    
    $
    1,575,024
   19




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##### Table of Contents



Parent Company Income Statements
  For the Three Months
    
    
    For the Nine MonthsEnded September 30,

    
    Ended September 30,2007
    
    
    2006
    
    
    2007
    
    
    2006Equity earnings:Investment in Enterprise Products Partners
    
    $
    31,831
    
    
    $
    31,635
    
    
    $
    93,427
    
    
    $
    82,085Investment in TEPPCO
    
    
    9,911
    
    
    
    8,345
    
    
    
    46,692
    
    
    
    24,959Investment in Energy Transfer Equity
    
    
    (3,042
    )
    
    
    
    
    
    
    (268
    )
    
    
    Total equity earnings
    
    
    38,700
    
    
    
    39,980
    
    
    
    139,851
    
    
    
    107,044General and administrative costs
    
    
    891
    
    
    
    395
    
    
    
    2,420
    
    
    
    1,524Operating income
    
    
    37,809
    
    
    
    39,585
    
    
    
    137,431
    
    
    
    105,520Other income (expense):Interest expense
    
    
    (25,627
    )
    
    
    (2,558
    )
    
    
    (50,345
    )
    
    
    (6,935
    )Interest income
    
    
    92
    
    
    
    15
    
    
    
    145
    
    
    
    41Total
    
    
    (25,535
    )
    
    
    (2,543
    )
    
    
    (50,200
    )
    
    
    (6,894
    )Income before provision of income tax and
cumulative effect of change in accounting principle
    
    
    12,274
    
    
    
    37,042
    
    
    
    87,231
    
    
    
    98,626Provision for income tax
    
    
    3
    
    
    
    
    
    
    
    3
    
    
    
    Cumulative effect of change in
accounting principle
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    18Net income
    
    $
    12,277
    
    
    $
    37,042
    
    
    $
    87,234
    
    
    $
    98,644
 20




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##### Table of Contents



Note 4. Business Segments
     21




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##### Table of Contents



Reportable SegmentInvestment
    
    
    
    
    
    Investmentin
    
    
    
    
    
    inEnterprise
    
    Investment
    
    Energy
    
    AdjustmentsProducts
    
    in
    
    Transfer
    
    and
    
    ConsolidatedPartners
    
    TEPPCO
    
    Equity
    
    Eliminations
    
    TotalsRevenues from external customers:Three months ended September 30, 2007
    
    $
    3,933,157
    
    
    $
    2,622,267
    
    
    $
    
    
    
    $
    
    
    
    $
    6,555,424Three months ended September 30, 2006
    
    
    3,740,162
    
    
    
    2,592,861
    
    
    
    
    
    
    
    
    
    
    
    6,333,023Nine months ended September 30, 2007
    
    
    11,268,342
    
    
    
    6,751,385
    
    
    
    
    
    
    
    
    
    
    
    18,019,727Nine months ended September 30, 2006
    
    
    10,304,580
    
    
    
    7,549,741
    
    
    
    
    
    
    
    
    
    
    
    17,854,321Revenues from related parties:Three months ended September 30, 2007
    
    
    178,839
    
    
    
    5,801
    
    
    
    
    
    
    
    (18,340
    )
    
    
    166,300Three months ended September 30, 2006
    
    
    132,363
    
    
    
    8,139
    
    
    
    
    
    
    
    (22,087
    )
    
    
    118,415Nine months ended September 30, 2007
    
    
    379,314
    
    
    
    7,834
    
    
    
    
    
    
    
    (50,606
    )
    
    
    336,542Nine months ended September 30, 2006
    
    
    335,872
    
    
    
    16,623
    
    
    
    
    
    
    
    (47,449
    )
    
    
    305,046Total revenues:Three months ended September 30, 2007
    
    
    4,111,996
    
    
    
    2,628,068
    
    
    
    
    
    
    
    (18,340
    )
    
    
    6,721,724Three months ended September 30, 2006
    
    
    3,872,525
    
    
    
    2,601,000
    
    
    
    
    
    
    
    (22,087
    )
    
    
    6,451,438Nine months ended September 30, 2007
    
    
    11,647,656
    
    
    
    6,759,219
    
    
    
    
    
    
    
    (50,606
    )
    
    
    18,356,269Nine months ended September 30, 2006
    
    
    10,640,452
    
    
    
    7,566,364
    
    
    
    
    
    
    
    (47,449
    )
    
    
    18,159,367Equity earnings (loss):Three months ended September 30, 2007
    
    
    11,604
    
    
    
    (1,991
    )
    
    
    (3,042
    )
    
    
    
    
    
    
    6,571Three months ended September 30, 2006
    
    
    2,265
    
    
    
    12
    
    
    
    
    
    
    
    
    
    
    
    2,277Nine months ended September 30, 2007
    
    
    9,516
    
    
    
    (4,120
    )
    
    
    (268
    )
    
    
    
    
    
    
    5,128Nine months ended September 30, 2006
    
    
    14,306
    
    
    
    3,676
    
    
    
    
    
    
    
    
    
    
    
    17,982Operating income:Three months ended September 30, 2007
    
    
    208,368
    
    
    
    75,998
    
    
    
    (3,042
    )
    
    
    (1,012
    )
    
    
    280,312Three months ended September 30, 2006
    
    
    273,857
    
    
    
    63,201
    
    
    
    
    
    
    
    (522
    )
    
    
    336,536Nine months ended September 30, 2007
    
    
    608,599
    
    
    
    251,815
    
    
    
    (268
    )
    
    
    (11,932
    )
    
    
    848,214Nine months ended September 30, 2006
    
    
    652,146
    
    
    
    189,144
    
    
    
    
    
    
    
    (1,648
    )
    
    
    839,642Segment assets:At September 30, 2007
    
    
    15,781,552
    
    
    
    5,507,265
    
    
    
    1,649,984
    
    
    
    (80,921
    )
    
    
    22,857,880At December 31, 2006
    
    
    13,867,693
    
    
    
    4,870,662
    
    
    
    
    
    
    
    (38,464
    )
    
    
    18,699,891Investments in and advances
to unconsolidated affiliates (see Note 9):At September 30, 2007
    
    
    630,450
    
    
    
    266,853
    
    
    
    1,649,984
    
    
    
    
    
    
    
    2,547,287At December 31, 2006
    
    
    444,189
    
    
    
    340,567
    
    
    
    
    
    
    
    
    
    
    
    784,756Intangible Assets (see Note 10):At September 30, 2007
    
    
    910,550
    
    
    
    929,363
    
    
    
    
    
    
    
    
    
    
    
    1,839,913At December 31, 2006
    
    
    986,304
    
    
    
    952,649
    
    
    
    
    
    
    
    
    
    
    
    1,938,953Goodwill (see Note 10):At September 30, 2007
    
    
    591,643
    
    
    
    216,430
    
    
    
    
    
    
    
    
    
    
    
    808,073At December 31, 2006
    
    
    590,541
    
    
    
    216,430
    
    
    
    
    
    
    
    
    
    
    
    806,971
  Enterprise Products Partners
  22




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##### Table of Contents



TEPPCO
     For the Three Months
    
    For the Nine MonthsEnded September 30,
    
    Ended September 30,2007
    
    2006
    
    2007
    
    2006Revenues from external customers
    
    $
    46,331
    
    
    $
    41,636
    
    
    $
    142,797
    
    
    $
    108,253Revenues from related parties
    
    
    1,028
    
    
    
    3,320
    
    
    
    7,485
    
    
    
    8,164Total revenues
    
    $
    47,359
    
    
    $
    44,956
    
    
    $
    150,282
    
    
    $
    116,417Operating income
    
    $
    23,223
    
    
    $
    18,572
    
    
    $
    66,766
    
    
    $
    72,526
 23




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##### Table of Contents



September 30,
    
    December 31,2007
    
    2006Segment assets
    
    $
    1,054,112
    
    
    $
    834,554Intangible assets
    
    
    152,261
    
    
    
    160,313Goodwill
    
    
    2,776
    
    
    
    2,776
 Energy Transfer Equity
    
 Note 5. Accounting for Unit-Based Awards
  24




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##### Table of Contents



For the Three Months
    
    
    For the Nine MonthsEnded September 30,
    
    
    Ended September 30,2007
    
    
    2006
    
    
    2007
    
    
    2006Parent Company:EPGP Unit Appreciation Rights
    
    $
    26
    
    
    $
    2
    
    
    $
    90
    
    
    $
    2EPCO Employee Partnerships
    
    
    36
    
    
    
    6
    
    
    
    67
    
    
    
    21EPCO 1998 Long-Term Incentive Plan (1998 Plan)
    
    
    37
    
    
    
    11
    
    
    
    70
    
    
    
    84Total parent company
    
    
    99
    
    
    
    19
    
    
    
    227
    
    
    
    107Enterprise Products Partners:EPCO Employee Partnerships
    
    
    1,364
    
    
    
    517
    
    
    
    2,542
    
    
    
    1,646EPCO 1998 Plan (1)
    
    
    2,120
    
    
    
    1,225
    
    
    
    9,887
    
    
    
    4,269DEPGP Unit Appreciation Rights
    
    
    23
    
    
    
    
    
    
    
    58
    
    
    
    Total Enterprise Products Partners
    
    
    3,507
    
    
    
    1,742
    
    
    
    12,487
    
    
    
    5,915TEPPCO:EPCO Employee Partnerships (2)
    
    
    150
    
    
    
    
    
    
    
    276
    
    
    
    EPCO 1998 Plan(2)
    
    
    207
    
    
    
    53
    
    
    
    434
    
    
    
    119TEPPCO 1999 Phantom Unit Retention Plan (1999 Plan)
    
    
    (51
    )
    
    
    374
    
    
    
    731
    
    
    
    555TEPPCO 2000 Long-Term Incentive Plan (2000 LTIP)
    
    
    (25
    )
    
    
    115
    
    
    
    277
    
    
    
    434TEPPCO 2005 Phantom Unit Plan (2005 Phantom Unit Plan)
    
    
    (112
    )
    
    
    343
    
    
    
    429
    
    
    
    846EPCO 2006 TPP Long-Term Incentive Plan (2006 LTIP)
    
    
    185
    
    
    
    
    
    
    
    289
    
    
    
    Total TEPPCO
    
    
    354
    
    
    
    885
    
    
    
    2,436
    
    
    
    1,954Total consolidated expense
    
    $
    3,960
    
    
    $
    2,646
    
    
    $
    15,150
    
    
    
    7,976
 
 (1)
    
    Amounts presented for the nine months ended September 30, 2007 include $4.6 million associated with the resignation
of a former chief executive officer of Enterprise Products Partners.(2)
    
    Represents amounts allocated to TEPPCO in connection with the use of shared services under the EPCO Administrative
Services Agreement. EPGP Unit Appreciation Rights
  EPCO Employee Partnerships
   EPE Unit III.
 25




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##### Table of Contents



§
    
    Distributions of Cash flow Each quarter, 100% of the cash distributions received by
EPE Unit III from the parent company will be distributed to the Class A limited partner
until it has received an amount equal to the pro rata Class A preferred return (as defined
below), and any remaining distributions received by EPE Unit III will be distributed to
the Class B limited partners. The Class A preferred return equals 3.797% per annum of the
Class A limited partners capital base. The Class A limited partners capital base equals
approximately $170.0 million plus any unpaid Class A preferred return from prior periods,
less any distributions made by EPE Unit III of proceeds from the sale of the parent
companys Units owned by EPE Unit III (as described below).§
    
    Liquidating Distributions Upon liquidation of EPE Unit III, Units having a fair
market value equal to the Class A limited partner capital base will be distributed to a
private company affiliate of EPCO, plus any accrued Class A preferred return for the
quarter in which liquidation occurs. Any remaining Units will be distributed to the Class
B limited partners.§
    
    Sale Proceeds If EPE Unit III sells any of the 4,421,326 parent companys Units that
it owns, the sale proceeds will be distributed to the Class A limited partner and the
Class B limited partners in the same manner as liquidating distributions described above.
  EPCO 1998 Plan
  26




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##### Table of Contents



Enterprise Products Partners unit options
 Weighted-Weighted-
    
    
    averageaverage
    
    
    remaining
    
    
    AggregateNumber of
    
    
    strike price
    
    
    contractual
    
    
    IntrinsicUnits
    
    
    (dollars/unit)
    
    
    term (in years)
    
    
    Value (1)Outstanding at December 31, 2006
    
    
    2,416,000
    
    
    $
    23.32Granted (2)
    
    
    895,000
    
    
    
    30.62Exercised
    
    
    (241,000
    )
    
    
    19.06Settled (3)
    
    
    (710,000
    )
    
    
    24.35Outstanding at September 30, 2007
    
    
    2,360,000
    
    
    
    26.22
    
    
    
    7.98
    
    
    $
    2,861Options exercisable at:September 30, 2007
    
    
    350,000
    
    
    $
    22.08
    
    
    
    4.26
    
    
    $
    2,861
 
 (1)
    
    Aggregate intrinsic value reflects fully vested option awards at September 30, 2007.(2)
    
    These awards cliff vest in May 2011. The total grant date value of these awards was $2.4 million based on the
following assumptions (i) expected life of the option of seven years; (ii) weighted-average risk-free interest rate of
4.80%; (iii) weighted-average expected distribution yield on Enterprise Products Partners common units of 8.40%; and
(iv) weighted-average expected unit price volatility on Enterprise Products Partners common units of 23.22%.(3)
    
    Reflects the settlement of options in connection with the resignation of a former chief executive officer of
Enterprise Products Partners.    27




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##### Table of Contents



Enterprise Products Partners restricted units
 Weighted-Average GrantNumber of
    
    
    Date Fair ValueUnits
    
    
    per Unit (1)Restricted units at December 31, 2006
    
    
    1,105,237Granted (2)
    
    

704,740
    
    
    $
    25.57Vested
    
    
    (500)
    
    
    
    25.70Forfeited
    
    
    (22,700)
    
    
    
    23.86Settled (3)
    
    
    (113,053)
    
    
    
    23.24Restricted units at September 30, 2007
    
    
    1,673,724
 
 (1)
    
    Determined by dividing the aggregate grant date fair value of awards
(including an allowance for forfeitures) by the number of awards issued.(2)
    
    These awards cliff vest in May 2011. Aggregate grant date fair value of
restricted unit awards issued during 2007 was $18.0 million based on a grant
date market price of Enterprise Products Partners common units ranging from
$28.00 to $30.96 per unit and estimated forfeiture rates ranging from 4.6% to
17.0%.(3)
    
    Reflects the settlement of restricted units in connection with the
resignation of a former chief executive officer of Enterprise Products Partners.  DEPGP Unit Appreciation Rights
  TEPPCO 1999 Plan
  TEPPCO 2000 LTIP
  28




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##### Table of Contents



TEPPCO 2005 Phantom Unit Plan
  TEPPCO 2006 LTIP
  TEPPCO unit options
 Weighted-Weighted-
    
    averageaverage
    
    remainingNumber of
    
    strike price
    
    contractualUnits
    
    (dollars/unit)
    
    term (in years)Option award activity during 2007:Granted in May 2007 (1)
    
    
    155,000
    
    
    $
    45.35Outstanding at September 30, 2007
    
    
    155,000
    
    
    
    45.35
    
    
    
    9.65
 
 (1)
    
    The total grant date fair value of these awards was $0.4 million based on the
following assumptions: (i) expected life of option of 7 years, (ii) risk-free interest
rate of 4.78%; (iii) expected distribution yield on TEPPCOs common units of 7.92%; and
(iv) expected unit price volatility on TEPPCOs common units of 18.03%.  29




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##### Table of Contents



TEPPCO restricted units .
 Weighted-Average GrantNumber of
    
    
    Date Fair ValueUnits
    
    
    per Unit (1)Restricted unit activity during 2007:Granted (2)
    
    
    62,900
    
    
    $
    37.64Forfeited
    
    
    (500
    )
    
    
    37.64Restricted units at September 30, 2007
    
    
    62,400
 
 (1)
    
    Determined by dividing the aggregate grant date fair value of awards
(including an allowance for forfeitures) by the number of awards issued.(2)
    
    Aggregate grant date fair value of restricted unit awards issued during
2007 was $2.4 million based on a grant date market price of TEPPCOs common
units of $45.35 per unit and an estimated forfeiture rate of 17.0%.  TEPPCO unit appreciation rights
 TEPPCO phantom units
 30




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##### Table of Contents



Note 6. Financial Instruments
  Interest Rate Risk Hedging Program
 Parent company.
  Enterprise Products Partners .
   31




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##### Table of Contents



Notional
    
    CashAmount
    
    Gain (Loss)Treasury lock portfolio, December 31, 2006 (1)
    
    $
    562.5First quarter of 2007 additions to portfolio (1)
    
    
    437.5Second quarter of 2007 terminations (2)
    
    
    (875.0
    )
    
    $
    42.3Third quarter of 2007 additions to portfolio (3)
    
    
    875.0Third quarter of 2007 terminations (4)
    
    
    (750.0
    )
    
    
    6.6Treasury lock portfolio, September 30, 2007 (5)
    
    $
    250.0
    
    
    $
    48.9
 
 (1)
    
    EPO entered into these transactions related to its anticipated issuances of debt in 2007.(2)
    
    Terminations relate to the issuance of the EPO Junior Notes B ($500.0 million) and EPO Senior Notes L ($375.0
million). Of the $42.3 million gain, $10.6 million relates to the EPO Junior Notes B and the remainder to the EPO Senior
Notes L and its successor debt.(3)
    
    EPO entered into these transactions related to its issuance of its Senior Notes L (including its successor debt) in
August 2007 ($500.0 million) and anticipated issuance of debt during the first half of 2008 ($250.0 million)(4)
    
    Terminations relate to the issuance of the EPO Senior Notes L and its successor debt.(5)
    
    The fair value of these financial instruments at September 30, 2007 was $2.9 million.  Duncan Energy Partners
 TEPPCO .
   Commodity Risk Hedging Program
 Enterprise Products Partners
 32




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##### Table of Contents



TEPPCO .
  Foreign Currency Hedging Program  Enterprise Products Partners
  33




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##### Table of Contents



Note 7. Inventories
  September 30,
    
    December 31,2007
    
    2006Investment in Enterprise Products Partners:Working inventory (1)
    
    $
    496,030
    
    
    $
    387,973Forward-sales inventory(2)
    
    
    13,858
    
    
    
    35,871Subtotal
    
    
    509,888
    
    
    
    423,844Investment in TEPPCO:Working inventory(3)
    
    
    48,486
    
    
    
    21,203Forward-sales inventory (4)
    
    
    77,950
    
    
    
    43,960Subtotal
    
    
    126,436
    
    
    
    65,163Eliminations
    
    
    (961
    )
    
    
    Total inventory
    
    $
    635,363
    
    
    $
    489,007
 
 (1)
    
    Working inventory is comprised of inventories of natural gas, NGLs and
certain petrochemical products that are either available-for-sale or used in
the provision for services.(2)
    
    Forward sales inventory consists of segregated NGL and natural gas volumes
dedicated to the fulfillment of forward-sales contracts.(3)
    
    Working inventory is comprised of inventories of crude oil, refined
products, LPGs, lubrication oils, and specialty chemicals that are either
available-for-sale or used in the provision for services.(4)
    
    Forward sales inventory primarily consists of segregated crude oil volumes
dedicated to the fulfillment of forward-sales contracts.    For the Three Months
    
    For the Nine MonthsEnded September 30,
    
    Ended September 30,2007
    
    2006
    
    2007
    
    2006Investment in Enterprise Products Partners (1)
    
    $
    3,527,776
    
    
    $
    3,248,533
    
    
    $
    9,886,949
    
    
    $
    8,986,599Investment in TEPPCO (2)
    
    
    2,438,094
    
    
    
    2,429,884
    
    
    
    6,187,071
    
    
    
    7,057,898Eliminations
    
    
    (17,270
    )
    
    
    (21,165
    )
    
    
    (43,905
    )
    
    
    (45,733
    )Total cost of sales
    
    $
    5,948,600
    
    
    $
    5,657,252
    
    
    $
    16,030,115
    
    
    $
    15,998,764
 
 (1)
    
    Includes LCM adjustments of $0.2 million and $5.7 million recognized during the three months ended September
30, 2007 and 2006, respectively. In addition, LCM adjustments of $13.3 million and $17.7 million were recognized
during the nine months ended September 30, 2007 and 2006, respectively.(2)
    
    Includes no LCM adjustment during the three months ended September 30, 2007. LCM adjustments of approximately
$0.3 million, $0.6 million and $0.3 million were recognized during the three months ended September 30, 2006, and
the nine months ended September 30, 2007 and 2006, respectively. 34




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##### Table of Contents



Note 8. Property, Plant and Equipment
  EstimatedUseful Life
    
    September 30,
    
    December 31,In Years
    
    2007
    
    2006Investment in Enterprise Products Partners:Plants, pipelines, buildings and related assets (1)
    
    
    3-35
    (5)
    
    $
    10,228,684
    
    
    $
    8,769,392Storage facilities(2)
    
    
    5-35
    (6)
    
    
    708,827
    
    
    
    596,649Offshore platforms and related facilities (3)
    
    
    20-31
    
    
    
    634,980
    
    
    
    161,839Transportation equipment(4)
    
    
    3-10
    
    
    
    30,558
    
    
    
    27,008Land
    
    
    
    
    
    
    45,353
    
    
    
    40,010Construction in progress
    
    
    
    
    
    
    1,287,350
    
    
    
    1,734,083Total historical cost
    
    
    
    
    
    
    12,935,752
    
    
    
    11,328,981Less accumulated depreciation
    
    
    
    
    
    
    1,802,357
    
    
    
    1,501,725Total carrying value, net
    
    
    
    
    
    $
    11,133,395
    
    
    $
    9,827,256Investment in TEPPCO:Plants, pipelines, buildings and related assets(1)
    
    
    5-40
    (5)
    
    $
    2,437,490
    
    
    $
    1,998,374Storage facilities(2)
    
    
    5-40
    (6)
    
    
    250,250
    
    
    
    202,336Transportation equipment(4)
    
    
    5-10
    
    
    
    6,193
    
    
    
    8,204Land
    
    
    
    
    
    
    192,549
    
    
    
    149,706Construction in progress
    
    
    
    
    
    
    336,267
    
    
    
    479,676Total historical cost
    
    
    
    
    
    
    3,222,749
    
    
    
    2,838,296Less accumulated depreciation
    
    
    
    
    
    
    616,610
    
    
    
    552,579Total carrying value, net
    
    
    
    
    
    $
    2,606,139
    
    
    $
    2,285,717Total property, plant and equipment, net
    
    
    
    
    
    $
    13,739,534
    
    
    $
    12,112,973
 
 (1)
    
    Includes processing plants; NGL, crude oil, natural gas and other pipelines; terminal loading and unloading facilities; buildings; office furniture and
equipment; laboratory and shop equipment; and related assets.(2)
    
    Includes underground product storage caverns, above ground storage tanks, water wells and related assets.(3)
    
    Includes offshore platforms and related facilities and assets.(4)
    
    Includes vehicles used and similar assets used in our operations.(5)
    
    In general, the estimated useful lives of major components of this category approximate the following: processing plants, 20-35 years; pipelines and related
equipment, 5-40 years; terminal facilities, 10-35 years; delivery facilities, 20-40 years; buildings, 20-40 years; office furniture and equipment, 3-20 years; and
laboratory and shop equipment, 5-35 years.(6)
    
    In general, the estimated useful lives of major components of this category approximate the following: underground storage facilities, 5-35 years; storage
tanks 10-40 years; and water wells, 5-35 years.  For the Three Months
    
    For the Nine MonthsEnded September 30,
    
    Ended September 30,2007
    
    2006
    
    2007
    
    2006Investment in Enterprise Products Partners:Depreciation expense(1)
    
    $
    108,692
    
    
    $
    88,929
    
    
    $
    302,758
    
    
    $
    259,361Capitalized interest(2)
    
    
    18,656
    
    
    
    15,015
    
    
    
    59,795
    
    
    
    36,570Investment in TEPPCO:Depreciation expense (1)
    
    
    26,017
    
    
    
    21,922
    
    
    
    72,306
    
    
    
    63,373Capitalized interest(2)
    
    
    2,010
    
    
    
    1,703
    
    
    
    8,813
    
    
    
    8,120
 
 (1)
    
    Depreciation expense is a component of operating costs and expenses as presented in our Unaudited
Condensed Statements of Consolidated Operations.(2)
    
    Capitalized interest increases the carrying value of the associated asset and reduces interest expense
during the period it is recorded. 35




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##### Table of Contents



Asset retirement obligations
  Investment inEnterpriseProducts
    
    Investment inPartners
    
    TEPPCO
    
    TotalARO liability balance, December 31, 2006
    
    $
    24,403
    
    
    $
    1,419
    
    
    $
    25,822Liabilities incurred
    
    
    1,673
    
    
    
    20
    
    
    
    1,693Liabilities settled
    
    
    (2,260
    )
    
    
    
    
    
    
    (2,260
    )Revisions in estimated cash flows
    
    
    8,693
    
    
    
    
    
    
    
    8,693Accretion expense
    
    
    3,397
    
    
    
    136
    
    
    
    3,533ARO liability balance, September 30, 2007(unaudited)
    
    $
    35,906
    
    
    $
    1,575
    
    
    $
    37,481
  36




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##### Table of Contents



Note 9. Investments In and Advances to Unconsolidated Affiliates
  Ownership
    
    Investments in and advances toPercentage at
    
    unconsolidated affiliates atSeptember 30,
    
    September 30,
    
    December 31,2007
    
    2007
    
    2006Investment in Enterprise Products Partners:Venice Energy Service Company L.L.C. (VESCO)
    
    
    13.1
    %
    
    $
    44,071
    
    
    $
    39,618K/D/S Promix, L.L.C. (Promix)
    
    
    50
    %
    
    
    51,186
    
    
    
    46,140Baton Rouge Fractionators LLC (BRF)
    
    
    32.3
    %
    
    
    25,037
    
    
    
    25,471Evangeline (1)
    
    
    49.5
    %
    
    
    3,968
    
    
    
    4,221Poseidon Oil Pipeline Company, L.L.C. (Poseidon)
    
    
    36
    %
    
    
    60,207
    
    
    
    62,324Cameron Highway Oil Pipeline Company (Cameron Highway)
    
    
    50
    %
    
    
    257,551
    
    
    
    60,216Deepwater Gateway, L.L.C. (Deepwater Gateway)
    
    
    50
    %
    
    
    111,865
    
    
    
    117,646Neptune Pipeline Company, L.L.C. (Neptune)
    
    
    25.7
    %
    
    
    55,906
    
    
    
    58,789Nemo Gathering Company, LLC (Nemo)
    
    
    33.9
    %
    
    
    2,610
    
    
    
    11,161Baton Rouge Propylene Concentrator, LLC (BRPC)
    
    
    30
    %
    
    
    13,712
    
    
    
    13,912Other
    
    
    50
    %
    
    
    4,337
    
    
    
    4,691Total Investment in Enterprise Products Partners
    
    
    
    
    
    
    630,450
    
    
    
    444,189Investment in TEPPCO:Seaway Crude Pipeline Company (Seaway)
    
    
    50
    %
    
    
    187,858
    
    
    
    194,587Centennial Pipeline LLC (Centennial) (2)
    
    
    50
    %
    
    
    78,646
    
    
    
    62,321MB Storage (3)
    
    
    
    
    
    
    
    
    
    
    83,290Other
    
    
    25
    %
    
    
    349
    
    
    
    369Total Investment in TEPPCO
    
    
    
    
    
    
    266,853
    
    
    
    340,567Investment in Energy Transfer Equity:(4)Energy Transfer Equity
    
    
    17.6
    %
    
    
    1,637,758
    
    
    
    ETEGP
    
    
    34.9
    %
    
    
    12,226
    
    
    
    Total Investment in Energy Transfer Equity
    
    
    
    
    
    
    1,649,984
    
    
    
    Total consolidated
    
    
    
    
    
    $
    2,547,287
    
    
    $
    784,756
 
 (1)
    
    Refers to ownership interests in Evangeline Gas Pipeline Company, L.P. and Evangeline Gas Corp., collectively.(2)
    
    At September 30, 2007, Centennial had $140.0 million of project debt outstanding due in April 2024. A wholly-owned subsidiary of TEPPCO has guaranteed 50% of this debt.
TEPPCO has a stand-ready obligation of $9.7 million in connection with this guarantee at September 30, 2007.(3)
    
    Refers to TEPPCOs ownership interests in Mont Belvieu Storage Partners, L.P. and Mont Belvieu Venture, LLC, collectively. On March 1, 2007, TEPPCO sold its ownership
interests in these entities.(4)
    
    See Note 4 for information regarding the business of Energy Transfer Equity.  37




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##### Table of Contents



Investment in
    
    
    
    
    
    Investment inEnterprise
    
    
    
    
    
    EnergyProducts
    
    Investment in
    
    TransferPartners
    
    TEPPCO
    
    Equity
    
    TotalInitial excess cost amounts attributable to:Fixed Assets
    
    $
    52,233
    
    
    $
    30,277
    
    
    $
    572,588
    
    
    $
    655,098Goodwill
    
    
    
    
    
    
    
    
    
    
    294,640
    
    
    
    294,640Intangibles  finite life
    
    
    
    
    
    
    30,021
    
    
    
    289,851
    
    
    
    319,872Intangibles  indefinite life
    
    
    
    
    
    
    
    
    
    
    513,508
    
    
    
    513,508Total
    
    $
    52,233
    
    
    $
    60,298
    
    
    $
    1,670,587
    
    
    $
    1,783,118Excess cost amounts, net of amortization at:September 30, 2007
    
    $
    36,627
    
    
    $
    35,265
    
    
    $
    1,653,902
    
    
    $
    1,725,794December 31, 2006
    
    $
    38,655
    
    
    $
    39,269
    
    
    $
    
    
    
    $
    77,924
     For the Three Months
    
    For the Nine MonthsEnded September 30,
    
    Ended September 30,2007
    
    2006
    
    2007
    
    2006Investment in Enterprise Products Partners
    
    $
    11,604
    
    
    $
    2,265
    
    
    $
    9,516
    
    
    $
    14,306Investment in TEPPCO
    
    
    (1,991
    )
    
    
    12
    
    
    
    (4,120
    )
    
    
    3,676Investment in Energy Transfer Equity
    
    
    (3,042
    )
    
    
    
    
    
    
    (268
    )
    
    
    Total
    
    $
    6,571
    
    
    $
    2,277
    
    
    $
    5,128
    
    
    $
    17,982
  38




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##### Table of Contents



Summarized Financial Information of Unconsolidated Affiliates
  Summarized Income Statement Information for the Three Months EndedSeptember 30, 2007
    
    September 30, 2006Operating
    
    Net
    
    
    
    
    
    Operating
    
    NetRevenues
    
    Income
    
    Income
    
    Revenues
    
    Income
    
    IncomeInvestment in Enterprise Products Partners
    
    $
    172,487
    
    
    $
    39,714
    
    
    $
    37,576
    
    
    $
    192,284
    
    
    $
    20,898
    
    
    $
    13,495Investment in TEPPCO
    
    
    32,350
    
    
    
    12,577
    
    
    
    9,985
    
    
    
    39,960
    
    
    
    10,749
    
    
    
    8,188
 Summarized Income Statement Information for the Nine Months EndedSeptember 30, 2007
    
    September 30, 2006Operating
    
    Net
    
    
    
    
    
    Operating
    
    NetRevenues
    
    Income
    
    Income
    
    Revenues
    
    Income
    
    Income (Loss)Investment in
Enterprise Products
Partners
    
    $
    492,530
    
    
    $
    92,619
    
    
    $
    59,275
    
    
    $
    513,188
    
    
    $
    34,167
    
    
    $
    11,305Investment in TEPPCO
    
    
    94,769
    
    
    
    30,142
    
    
    
    22,210
    
    
    
    122,742
    
    
    
    33,958
    
    
    
    26,030
 MB Storage.
 Cameron Highway.
 Nemo.
   39




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##### Table of Contents



Energy Transfer Equity
  
 Note 10. Intangible Assets and Goodwill
 Identifiable Intangible Assets
  September 30, 2007Gross
    
    Accum.
    
    CarryingValue
    
    Amort.
    
    ValueInvestment in Enterprise Products Partners:Customer relationship intangibles
    
    $
    845,607
    
    
    
    (197,952
    )
    
    
    647,655Contract-based intangibles
    
    
    384,004
    
    
    
    (121,109
    )
    
    
    262,895Subtotal
    
    
    1,229,611
    
    
    
    (319,061
    )
    
    
    910,550Investment in TEPPCO:Incentive distribution rights
    
    
    606,926
    
    
    
    
    
    
    
    606,926Gas gathering agreements
    
    
    462,448
    
    
    
    (172,386
    )
    
    
    290,062Other contract-based intangibles
    
    
    54,698
    
    
    
    (22,323
    )
    
    
    32,375Subtotal
    
    
    1,124,072
    
    
    
    (194,709
    )
    
    
    929,363Total
    
    $
    2,353,683
    
    
    
    (513,770
    )
    
    
    1,839,913
 December 31, 2006Gross
    
    Accum.
    
    CarryingValue
    
    Amort.
    
    ValueInvestment in Enterprise Products Partners:Customer relationship intangibles
    
    $
    854,176
    
    
    $
    (150,065
    )
    
    $
    704,111Contract-based intangibles
    
    
    384,004
    
    
    
    (101,811
    )
    
    
    282,193Subtotal
    
    
    1,238,180
    
    
    
    (251,876
    )
    
    
    986,304Investment in TEPPCO:Incentive distribution rights
    
    
    606,926
    
    
    
    
    
    
    
    606,926Gas gathering agreements
    
    
    462,447
    
    
    
    (149,024
    )
    
    
    313,423Other contract-based intangibles
    
    
    52,200
    
    
    
    (19,900
    )
    
    
    32,300Subtotal
    
    
    1,121,573
    
    
    
    (168,924
    )
    
    
    952,649Total
    
    $
    2,359,753
    
    
    $
    (420,800
    )
    
    $
    1,938,953
  For the Three Months
    
    For the Nine MonthsEnded September 30,
    
    Ended September 30,2007
    
    2006
    
    2007
    
    2006Investment in Enterprise Products Partners
    
    $
    22,059
    
    
    $
    23,621
    
    
    $
    67,294
    
    
    $
    65,555Investment in TEPPCO
    
    
    8,824
    
    
    
    8,348
    
    
    
    25,786
    
    
    
    24,330Total
    
    $
    30,883
    
    
    $
    31,969
    
    
    $
    93,080
    
    
    $
    89,885
  40




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##### Table of Contents



§
    
    2% of quarterly cash distributions up to $0.275 per unit paid by TEPPCO;§
    
    15% of quarterly cash distributions from $0.276 per unit up to $0.325 per unit paid
by TEPPCO; and§
    
    25% of quarterly cash distributions that exceed $0.325 per unit paid by TEPPCO.
 Goodwill
  September 30,
    
    December 31,2007
    
    2006Investment in Enterprise Products Partners
    
    $
    591,643
    
    
    $
    590,541Investment in TEPPCO
    
    
    216,430
    
    
    
    216,430Totals
    
    $
    808,073
    
    
    $
    806,971
  41




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##### Table of Contents



Note 11. Debt Obligations
  September 30,
    
    December 31,2007
    
    2006Debt obligations of the Parent Company:EPE August Revolver, variable rate, due September 2012
    
    $
    108,000
    
    
    $
    Term Loan A,
variable rate, due September 2012
    
    
    125,000
    
    
    
    Term Loan
A-2, variable rate, refinanced November 2007 (1)
    
    
    850,000
    
    
    
    EPE Revolver, variable rate, repaid May 2007
    
    
    
    
    
    
    155,000Total debt obligations of the Parent Company
    
    
    1,083,000
    
    
    
    155,000Senior debt obligations of Enterprise Products Partners:EPO Revolver, variable rate, due October 2011
    
    
    105,000
    
    
    
    410,000EPO Senior Notes B, 7.50% fixed-rate, due February 2011
    
    
    450,000
    
    
    
    450,000EPO Senior Notes C, 6.375% fixed-rate, due February 2013
    
    
    350,000
    
    
    
    350,000EPO Senior Notes D, 6.875% fixed-rate, due March 2033
    
    
    500,000
    
    
    
    500,000EPO Senior Notes E, 4.00% fixed-rate, refinanced October 2007 (1)
    
    
    500,000
    
    
    
    500,000EPO Senior Notes F, 4.625% fixed-rate, due October 2009
    
    
    500,000
    
    
    
    500,000EPO Senior Notes G, 5.60% fixed-rate, due October 2014
    
    
    650,000
    
    
    
    650,000EPO Senior Notes H, 6.65% fixed-rate, due October 2034
    
    
    350,000
    
    
    
    350,000EPO Senior Notes I, 5.00% fixed-rate, due March 2015
    
    
    250,000
    
    
    
    250,000EPO Senior Notes J, 5.75% fixed-rate, due March 2035
    
    
    250,000
    
    
    
    250,000EPO Senior Notes K, 4.950% fixed-rate, due June 2010
    
    
    500,000
    
    
    
    500,000EPO Senior Notes L, 6.30%, fixed-rate, due September 2017
    
    
    800,000
    
    
    
    Petal GO Zone Bonds, variable rate, due August 2034
    
    
    57,500
    
    
    
    Pascagoula MBFC Loan, 8.70% fixed-rate, due March 2010
    
    
    54,000
    
    
    
    54,000Dixie Revolver, variable rate, due June 2010
    
    
    10,000
    
    
    
    10,000Duncan Energy Partners Revolver, variable rate, variable rate, due February 2011
    
    
    215,000
    
    
    
    Other senior subordinated notes, 8.75% fixed-rate, redeemed in November 2007
    
    
    5,068
    
    
    
    5,068Total senior debt obligations of Enterprise Products Partners
    
    
    5,546,568
    
    
    
    4,779,068Senior debt obligations of TEPPCO:TEPPCO Revolver, variable rate, due December 2011
    
    
    377,000
    
    
    
    490,000TEPPCO Senior Notes, 7.625% fixed rate, due February 2012
    
    
    500,000
    
    
    
    500,000TEPPCO Senior Notes, 6.125% fixed rate, due February 2013
    
    
    200,000
    
    
    
    200,000TE Products Senior Notes, 6.45% fixed-rate, due January 2008 (1)
    
    
    180,000
    
    
    
    180,000TE Products Senior Notes, 7.51% fixed-rate, due January 2028
    
    
    210,000
    
    
    
    210,000Total senior debt obligations of TEPPCO
    
    
    1,467,000
    
    
    
    1,580,000Total principal amount of senior debt obligations
    
    
    8,096,568
    
    
    
    6,514,068Subordinated debt obligations of Enterprise Products Partners:EPO Junior Notes A, fixed/variable rates, due August 2066
    
    
    550,000
    
    
    
    550,000EPO Junior Notes B, fixed/variable rates, due January 2068
    
    
    700,000
    
    
    
    Total subordinated debt obligations of Enterprise Products Partners
    
    
    1,250,000
    
    
    
    550,000Subordinated debt obligations of TEPPCO:TEPPCO Junior Subordinated Notes, fixed/variable rates, due June 2067
    
    
    300,000
    
    
    
    Total principal amount of senior and subordinated debt obligations
    
    
    9,646,568
    
    
    
    7,064,068Other, non-principal amounts:Changes in fair value of debt-related financial instruments (2)
    
    
    (11,497
    )
    
    
    (22,852
    )Unamortized discounts, net of premiums
    
    
    (15,293
    )
    
    
    (15,291
    )Unamortized deferred gains related to terminated interest rate swap
    
    
    23,171
    
    
    
    27,952Total other, non-principal amounts
    
    
    (3,619
    )
    
    
    (10,191
    )Total long-term debt
    
    $
    9,642,949
    
    
    $
    7,053,877Standby letters of credit outstanding
    
    $
    19,255
    
    
    $
    58,858
 
 (1)
    
    In accordance with SFAS 6, long-term and current maturities of debt reflects the classification of such obligations at September 30, 2007 and December 31,
2006. Term Loan A-2 was refinanced in November 2007 (see Note 18). With respect to the EPO Senior Notes E due in October 2007, EPO used borrowings under its
long-term Revolver to fund the repayment of this debt at maturity. With respect to TE Products 6.45% Senior Notes due in January 2008, TEPPCO has the ability to
use available credit capacity under its Revolver to fund the repayment of this debt at maturity.(2)
    
    See Note 6 for information regarding our financial instruments. 42




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##### Table of Contents



Guarantor Relationships
   Debt Obligations of the Parent Company
  EPE Interim Credit Facility
  §
    
    $155.0 million to repay principal outstanding under the EPE Revolver; and§
    
    $1.2 billion under the EPE Term Loan (Debt Bridge) and $500.0 million under the EPE
Term Loan (Equity Bridge) to fund the $1.65 billion cash purchase price for the
acquisition of membership interests in ETEGP and common units of Energy Transfer
Equity.
   EPE August 2007 Credit Agreement
  43




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Consolidated Debt Obligations of Enterprise Products Partners
  EPO Junior Notes B
   44




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##### Table of Contents



EPO Senior Notes L
  Canadian Revolver
   Duncan Energy Partners Revolver
  45




---



##### Table of Contents



1 2
  Petal MBFC Loan.
 Petal GO Zone Bonds .
 Consolidated Debt Obligations of TEPPCO
  TEPPCO Junior Subordinated Notes
 46




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##### Table of Contents



Covenants
  Information regarding variable interest rates paid
  Range of
    
    Weighted-averageinterest rates
    
    interest ratepaid
    
    paidEPE August 2007 Revolver
    
    7.25% to 9.25%
    
    
    7.26
    %EPE Term Loan A
    
    
    7.25
    %
    
    
    7.25
    %EPE Term Loan A-2
    
    
    7.25
    %
    
    
    7.25
    %EPE Interim Credit Facility
    
    7.07% to 8.50%
    
    
    7.09
    %EPE Revolver
    
    6.32% to 6.35%
    
    
    6.32
    %EPO Revolver
    
    5.82% to 8.25%
    
    
    5.87
    %Canadian Revolver
    
    4.95% to 5.82%
    
    
    5.68
    %Dixie Revolver
    
    5.66% to 5.67%
    
    
    5.66
    %Petal GO Zone Bonds
    
    3.76% to 4.15%
    
    
    3.89
    %Duncan Energy Partners Revolver
    
    5.99% to 6.48%
    
    
    6.21
    %TEPPCO Revolver
    
    5.64% to 6.31%
    
    
    5.94
    %
 47




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##### Table of Contents



Consolidated debt maturity table
  2007
    
    $
    2008
    
    
    2009
    
    
    500,0002010
    
    
    569,0682011
    
    
    1,647,000Thereafter
    
    
    6,930,500Total scheduled principal payments
    
    $
    9,646,568
  
 Note 12. Partners Equity and Distributions
     Class B and C Units
   48




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##### Table of Contents



Private Placement of Parent Company Units
    Unit History
  Class B
    
    Class CUnits
    
    Units
    
    UnitsBalance, December 31, 2006(Restated)
    
    
    88,884,116
    
    
    
    14,173,304
    
    
    
    16,000,000Conversion of Class B Units to Units in July 2007
    
    
    14,173,304
    
    
    
    (14,173,304
    )
    
    
    Units issued in connection private placement in July 2007
    
    
    20,134,220
    
    
    
    
    
    
    
    Balance, September 30, 2007
    
    
    123,191,640
    
    
    
    
    
    
    
    16,000,000
 Summary of Changes in Limited Partners Equity
  Class B
    
    Class CUnits
    
    Units
    
    Units
    
    TotalBalance, December 31, 2006
    
    $
    680,922
    
    
    $
    357,082
    
    
    $
    380,665
    
    
    $
    1,418,669Net income
    
    
    53,839
    
    
    
    33,386
    
    
    
    
    
    
    
    87,225Operating leases paid by EPCO
    
    
    80
    
    
    
    
    
    
    
    
    
    
    
    80Cash distributions to partners
    
    
    (110,365
    )
    
    
    
    
    
    
    
    
    
    
    (110,365
    )Cash distributions to former owners of TEPPCO interests
    
    
    
    
    
    
    (29,760
    )
    
    
    
    
    
    
    (29,760
    )Conversion of Class B Units
    
    
    360,708
    
    
    
    (360,708
    )
    
    
    
    
    
    
    Proceeds
from issuance of our Units, net
    
    
    739,866
    
    
    
    
    
    
    
    
    
    
    
    739,866Amortization of equity awards
    
    
    343
    
    
    
    
    
    
    
    
    
    
    
    343Balance, September 30, 2007
    
    $
    1,725,393
    
    
    $
    
    
    
    $
    380,665
    
    
    $
    2,106,058
  49




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##### Table of Contents



Distributions to Partners
  Cash Distribution HistoryDistribution
    
    Record
    
    Paymentper Unit
    
    Date
    
    Date20061st Quarter
    
    $
    0.295
    
    
    Apr. 28, 2006
    
    May 11, 20062nd Quarter
    
    $
    0.310
    
    
    Jul. 31, 2006
    
    Aug. 11, 20063rd Quarter
    
    $
    0.335
    
    
    Oct. 31, 2006
    
    Nov. 9, 20064th Quarter
    
    $
    0.350
    
    
    Jan. 31, 2007
    
    Feb. 9, 200720071st Quarter
    
    $
    0.365
    
    
    Apr. 30, 2007
    
    May 11, 20072nd Quarter
    
    $
    0.380
    
    
    Jul. 31, 2007
    
    Aug. 10, 20073rd Quarter
    
    $
    0.395
    
    
    Oct. 31, 2007
    
    Nov. 9, 2007
 
 Note 13. Related Party Transactions
  For the Three Months
    
    For the Nine MonthsEnded September 30,
    
    Ended September 30,2007
    
    2006
    
    2007
    
    2006Revenues from consolidated operations:EPCO and affiliates
    
    $
    2
    
    
    $
    33,775
    
    
    $
    5
    
    
    $
    55,808Energy Transfer Equity
    
    
    79,017
    
    
    
    
    
    
    
    121,625
    
    
    
    Other unconsolidated affiliates
    
    
    87,281
    
    
    
    84,640
    
    
    
    214,912
    
    
    
    249,238Total
    
    $
    166,300
    
    
    $
    118,415
    
    
    $
    336,542
    
    
    $
    305,046Operating costs and expenses:EPCO and affiliates
    
    $
    96,099
    
    
    $
    99,326
    
    
    $
    290,652
    
    
    $
    311,496Energy Transfer Equity
    
    
    2,614
    
    
    
    
    
    
    
    8,385
    
    
    
    Other unconsolidated affiliates
    
    
    10,485
    
    
    
    7,715
    
    
    
    27,715
    
    
    
    24,754Total
    
    $
    109,198
    
    
    $
    107,041
    
    
    $
    326,752
    
    
    $
    336,250General and administrative costs:EPCO and affiliates
    
    $
    18,222
    
    
    $
    15,381
    
    
    $
    64,746
    
    
    $
    49,656
   
    
    EPCO and its consolidated private company subsidiaries;
    
    EPE Holdings, our general partner; and
    
    the Employee Partnerships.
 50




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EPCO Administrative Services Agreement
   51




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##### Table of Contents



Relationships with Unconsolidated Affiliates
 Enterprise Products Partners
 TEPPCO
 Energy Transfer Equity
    
 Note 14. Earnings Per Unit
   52




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##### Table of Contents



For the Three Months
    
    For the Nine MonthsEnded September 30,
    
    Ended September 30,2007
    
    2006
    
    2007
    
    2006Net income
    
    $
    12,277
    
    
    $
    37,042
    
    
    $
    87,234
    
    
    $
    98,644Multiplied by general partner ownership interest
    
    
    0.01
    %
    
    
    0.01
    %
    
    
    0.01
    %
    
    
    0.01
    %General partner interest in net income
    
    $
    1
    
    
    $
    4
    
    
    $
    9
    
    
    $
    10
  For the Three Months
    
    For the Nine MonthsEnded September 30,
    
    Ended September 30,2007
    
    2006
    
    2007
    
    2006Income before change in accounting principle
and general partner interest
    
    $
    12,277
    
    
    $
    37,042
    
    
    $
    87,234
    
    
    $
    98,548Cumulative effect of change in accounting principle
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    96Net income
    
    
    12,277
    
    
    
    37,042
    
    
    
    87,234
    
    
    
    98,644General partner interest in net income
    
    
    (1
    )
    
    
    (4
    )
    
    
    (9
    )
    
    
    (10
    )Net income available to limited partners
    
    $
    12,276
    
    
    $
    37,038
    
    
    $
    87,225
    
    
    $
    98,634BASIC AND DILUTED EARNINGS PER UNITNumeratorIncome before change in accounting principle
and general partner interest
    
    $
    12,277
    
    
    $
    37,042
    
    
    $
    87,234
    
    
    $
    98,548Cumulative effect of change in accounting principle
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    96General partner interest in net income
    
    
    (1
    )
    
    
    (4
    )
    
    
    (9
    )
    
    
    (10
    )Limited partners interest in net income
    
    $
    12,276
    
    
    $
    37,038
    
    
    $
    87,225
    
    
    $
    98,634DenominatorUnits
    
    
    117,995
    
    
    
    88,884
    
    
    
    98,695
    
    
    
    88,884Class B Units
    
    
    1,695
    
    
    
    14,173
    
    
    
    9,968
    
    
    
    14,173Total
    
    
    119,690
    
    
    
    103,057
    
    
    
    108,663
    
    
    
    103,057Basic and diluted earnings per unitIncome before change in accounting principle
and general partner interest
    
    $
    0.10
    
    
    $
    0.36
    
    
    $
    0.80
    
    
    $
    0.96Cumulative effect of change in accounting principle
    
    
    *
    
    
    
    *
    
    
    
    *
    
    
    
    *General partner interest in net income
    
    
    *
    
    
    
    *
    
    
    
    *
    
    
    
    *Limited partners interest in net income
    
    $
    0.10
    
    
    $
    0.36
    
    
    $
    0.80
    
    
    $
    0.96
 
 *
    Amount is negligible 
 Note 15. Commitments and Contingencies
 Litigation
  53




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Enterprise Products Partners matters .
   TEPPCO matters .
  54




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##### Table of Contents



Energy Transfer Equity matters
   55




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##### Table of Contents



Contractual Obligations
  Payment or Settlement due by PeriodContractual Obligations
    
    Total
    
    2007
    
    2008
    
    2009
    
    2010
    
    2011
    
    ThereafterScheduled maturities of long-term debtParent Company (1)
    
    $
    1,083
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    1,083Enterprise Products Partners (2)

    
    6,796
    
    
    
    
    
    
    
    
    
    
    
    500
    
    
    
    569
    
    
    
    1,270
    
    
    
    4,457TEPPCO (3)
    
    
    1,767
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    377
    
    
    
    1,390
 
 (1)
    
    See Note 11 for information regarding the parent companys debt obligations.(2)
    
    Represents consolidated debt obligations of Enterprise Products Partners, including EPO, Duncan Energy Partners, Dixie and Canadian Enterprise.(3)
    
    Represents payment obligations under the TEPPCO Revolver, junior subordinated notes and senior notes as of September 30, 2007 (see Note 11). Scheduled Maturities of Long-Term Debt
 Operating Lease Obligations.
 Performance Guaranty
  Other Claims
  56




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Note 16. Significant Risks and Uncertainties  Weather-Related Risks
   For the Three Months
    
    
    For the Nine MonthsEnded September 30,
    
    
    Ended September 30,2007
    
    
    2006
    
    
    2007
    
    
    2006Business interruption (BI) proceeds:Hurricane Ivan
    
    $
    
    
    
    $
    5,157
    
    
    $
    377
    
    
    $
    17,383Hurricane Katrina
    
    
    1,301
    
    
    
    24,325
    
    
    
    14,500
    
    
    
    24,325Hurricane Rita
    
    
    743
    
    
    
    20,740
    
    
    
    9,000
    
    
    
    20,740Other
    
    
    
    
    
    
    
    
    
    
    996
    
    
    
    Total BI proceeds
    
    $
    2,044
    
    
    $
    50,222
    
    
    $
    24,873
    
    
    $
    62,448Property damage (PD) proceeds:Hurricane Ivan
    
    $
    
    
    
    $
    
    
    
    $
    1,273
    
    
    $
    24,104Hurricane Katrina
    
    
    
    
    
    
    6,975
    
    
    
    6,563
    
    
    
    6,975Hurricane Rita
    
    
    
    
    
    
    2,730
    
    
    
    
    
    
    
    2,730Other
    
    
    
    
    
    
    
    
    
    
    184
    
    
    
    Total PD proceeds
    
    $
    
    
    
    $
    9,705
    
    
    $
    8,020
    
    
    $
    33,809Total
    
    $
    2,044
    
    
    $
    59,927
    
    
    $
    32,893
    
    
    $
    96,257
  57




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Note 17. Supplemental Cash Flow Information
   For the Nine MonthsEnded September 30,2007
    
    
    2006Decrease (increase) in:Accounts and notes receivable
    
    $
    (540,036
    )
    
    $
    91,014Inventories
    
    
    (245,354
    )
    
    
    (121,333
    )Prepaid and other current assets
    
    
    (48,971
    )
    
    
    (49,189
    )Other assets
    
    
    (3,610
    )
    
    
    (12,540
    )Increase (decrease) in:Accounts payable
    
    
    45,975
    
    
    
    48,920Accrued
product payables
    
    
    695,497
    
    
    
    83,306Accrued expenses
    
    
    153,254
    
    
    
    69,173Accrued interest
    
    
    5,963
    
    
    
    (7,081
    )Other current liabilities
    
    
    9,484
    
    
    
    79,118Other long-term liabilities
    
    
    (5,681
    )
    
    
    (2,305
    )Net effect of changes in operating accounts
    
    $
    66,521
    
    
    $
    179,083
 Contributions in aid of construction costs
  TEPPCO gain on sale of MB Storage and related assets
  Cash used for business combinations  Encinal Acquisition in July 2006
  58




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##### Table of Contents



Note 18. Subsequent Events
 Parent Company Term Loan B
  Dixie Pipeline Matter
  59




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##### Table of Contents



Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations .
 For the three and nine months ended September 30, 2007 and 2006
   §
    
    Cautionary Note Regarding Forward-Looking Statements.§
    
    Overview of Critical Accounting Policies and Estimates.§
    
    Overview of Business.§
    
    Recent Developments  Discusses significant developments affecting the parent company
since December 31, 2006.§
    
    Basis of Presentation  Discusses key considerations in the presentation of financial
and operating results as a result of recent investing activities.§
    
    Results of Operations  Discusses material period-to-period variances for the parent
company and by reportable segment.§
    
    Liquidity and Capital Resources  Addresses available sources of liquidity and capital
resources for the parent company and its subsidiaries.§
    
    Other Items  Includes information related to contractual obligations, off-balance
sheet arrangements, related party transactions, recent accounting pronouncements and
similar disclosures.
  Significant Relationships Referenced in this Discussion and Analysis
     60




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Cautionary Note Regarding Forward-Looking Statements
  Overview of Critical Accounting Policies and Estimates
  61




---



##### Table of Contents



Overview of Business
      Enterprise Products Partners
    62




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##### Table of Contents



TEPPCO
   Energy Transfer Equity
     63




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##### Table of Contents



Recent Developments
  §
    
    In May 2007, the parent company entered into a securities purchase agreement pursuant
to which it acquired 38,976,090 common units of Energy Transfer Equity and approximately
34.9% of the membership interests in ETEGP for $1.65 billion in cash (see Note 1 of the
Notes to Unaudited Condensed Consolidated Financial Statements included under Item 1 of
this quarterly report). These partnership and membership interests represent
non-controlling interests in each entity. Energy Transfer Equity owns common units of ETP
and the general partner of ETP, which is entitled to 2% of the quarterly cash
distributions of ETP as well as the associated IDRs of ETP. This acquisition was
initially financed using borrowings under a short-term credit agreement, which was
replaced in stages by long-term financing by November 2007 (see following highlights).§
    
    In July 2007, the parent company completed a private placement of 20,134,220 Units to
third party investors at $37.25 per Unit. The net proceeds of this private placement were
approximately $740.0 million and were used to repay $738.0 million of principal and $2.0 million of
related accrued interest associated with borrowings made in May 2007 to acquire ownership
interests in Energy Transfer Equity and ETEGP. See Note 12 of the Notes to Unaudited
Condensed Consolidated Financial Statements included under Item 1 of this quarterly report
for additional information regarding this offering. These Units were registered for
resale in October 2007.§
    
    In November 2007, the parent company executed a seven-year, $850 million senior
secured term loan (Term Loan B) due November 2014 in the institutional loan market. Proceeds from the
Term Loan B were used to permanently refinance borrowings outstanding under the parent
companys $850.0 million Term Loan A-2 that had a maturity date in May 2008. This
transaction completed the permanent financing related to the parent companys $1.65
billion acquisition of ownership interests in Energy Transfer Equity and ETEGP in May
2007. The remaining debt was refinanced in August 2007 using borrowings under the parent
companys August 2007 Credit Agreement. See Notes 11 and 18 of the Notes to Unaudited
Condensed Consolidated Financial Statements included under Item 1 of this quarterly report
for additional information regarding the parent companys debt obligations and associated
maturities.
 Basis of Presentation
   64




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65




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Results of Operations
 Parent Company Information
  For the Three Months
    
    For the Nine MonthsEnded September 30,
    
    Ended September 30,2007
    
    2006
    
    2007
    
    2006Equity earnings:Investment in Enterprise Products Partners
    
    $
    31,831
    
    
    $
    31,635
    
    
    $
    93,427
    
    
    $
    82,085Investment in TEPPCO
    
    
    9,911
    
    
    
    8,345
    
    
    
    46,692
    
    
    
    24,959Investment in Energy Transfer Equity
    
    
    (3,042
    )
    
    
    
    
    
    
    (268
    )
    
    
    Total equity earnings
    
    
    38,700
    
    
    
    39,980
    
    
    
    139,851
    
    
    
    107,044General and administrative costs
    
    
    891
    
    
    
    395
    
    
    
    2,420
    
    
    
    1,524Operating income
    
    
    37,809
    
    
    
    39,585
    
    
    
    137,431
    
    
    
    105,520Other income (expense):Interest expense
    
    
    (25,627
    )
    
    
    (2,558
    )
    
    
    (50,345
    )
    
    
    (6,935
    )Interest income
    
    
    92
    
    
    
    15
    
    
    
    145
    
    
    
    41Total
    
    
    (25,535
    )
    
    
    (2,543
    )
    
    
    (50,200
    )
    
    
    (6,894
    )Income before provision of income tax and
cumulative effect of change in accounting principle
    
    
    12,274
    
    
    
    37,042
    
    
    
    87,231
    
    
    
    98,626Provision for income tax
    
    
    3
    
    
    
    
    
    
    
    3
    
    
    
    Cumulative effect of change in
accounting principle
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    18Net income
    
    $
    12,277
    
    
    $
    37,042
    
    
    $
    87,234
    
    
    $
    98,644
      66




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Consolidated Information
      67




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##### Table of Contents



For the Three Months
    
    For the Nine MonthsEnded September 30,
    
    Ended September 30,2007
    
    
    
    2006
    
    
    
    2007
    
    
    
    2006Revenues:Investment in Enterprise Products Partners
    
    $
    4,111,996
    
    
    $
    3,872,525
    
    
    $
    11,647,656
    
    
    $
    10,640,452Investment in TEPPCO
    
    
    2,628,068
    
    
    
    2,601,000
    
    
    
    6,759,219
    
    
    
    7,566,364Eliminations
    
    
    (18,340
    )
    
    
    (22,087
    )
    
    
    (50,606
    )
    
    
    (47,449
    )Total revenues
    
    
    6,721,724
    
    
    
    6,451,438
    
    
    
    18,356,269
    
    
    
    18,159,367Costs and expenses:Investment in Enterprise Products Partners
    
    
    3,915,232
    
    
    
    3,600,933
    
    
    
    11,048,573
    
    
    
    10,002,612Investment in TEPPCO
    
    
    2,550,079
    
    
    
    2,537,811
    
    
    
    6,503,284
    
    
    
    7,380,896Other, non-segment including parent
    
    
    (17,328
    )
    
    
    (21,565
    )
    
    
    (38,674
    )
    
    
    (45,801
    )Total costs and expenses
    
    
    6,447,983
    
    
    
    6,117,179
    
    
    
    17,513,183
    
    
    
    17,337,707Equity earnings (loss):Investment in Enterprise Products Partners
    
    
    11,604
    
    
    
    2,265
    
    
    
    9,516
    
    
    
    14,306Investment in TEPPCO
    
    
    (1,991
    )
    
    
    12
    
    
    
    (4,120
    )
    
    
    3,676Investment in Energy Transfer Equity
    
    
    (3,042
    )
    
    
    
    
    
    
    (268
    )
    
    
    Total equity earnings (loss)
    
    
    6,571
    
    
    
    2,277
    
    
    
    5,128
    
    
    
    17,982Operating income:Investment in Enterprise Products Partners
    
    
    208,368
    
    
    
    273,857
    
    
    
    608,599
    
    
    
    652,146Investment in TEPPCO
    
    
    75,998
    
    
    
    63,201
    
    
    
    251,815
    
    
    
    189,144Investment in Energy Transfer Equity
    
    
    (3,042
    )
    
    
    
    
    
    
    (268
    )
    
    
    Other, non-segment including parent
    
    
    (1,012
    )
    
    
    (522
    )
    
    
    (11,932
    )
    
    
    (1,648
    )Total operating income
    
    
    280,312
    
    
    
    336,536
    
    
    
    848,214
    
    
    
    839,642Interest expense
    
    
    (137,602
    )
    
    
    (88,533
    )
    
    
    (341,949
    )
    
    
    (247,661
    )Provision for income taxes
    
    
    (2,056
    )
    
    
    (3,428
    )
    
    
    (9,208
    )
    
    
    (13,105
    )Other income, net
    
    
    2,856
    
    
    
    3,260
    
    
    
    69,152
    
    
    
    10,004Income before minority interest and accounting change
    
    
    143,510
    
    
    
    247,835
    
    
    
    566,209
    
    
    
    588,880Minority interest
    
    
    (131,233
    )
    
    
    (210,793
    )
    
    
    (478,975
    )
    
    
    (490,332
    )Cumulative effect of change in accounting principle
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    96Net income
    
    $
    12,277
    
    
    $
    37,042
    
    
    $
    87,234
    
    
    $
    98,644
  Comparison of Segment Results for the Three Months Ended September 30, 2007 with the Three Months Ended September 30, 2006
 Investment in Enterprise Products Partners
   68




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Investment in TEPPCO
     69




---



##### Table of Contents



Investment in Energy Transfer Equity
 Comparison of Segment Results for the Nine Months Ended September 30, 2007 with the Nine Months Ended September 30, 2006
 Investment in Enterprise Products Partners
       Investment in TEPPCO
 70




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Investment in Energy Transfer Equity
 Interest Expense
  For the Three Months
    
    For the Nine MonthsEnded September 30,
    
    Ended September 30,2007
    
    
    
    2006
    
    
    
    2007
    
    
    
    2006Interest expense attributable to:Consolidated debt obligations of Enterprise Products Partners
    
    $
    85,075
    
    
    $
    62,793
    
    
    $
    219,708
    
    
    $
    177,203Consolidated debt obligations of TEPPCO
    
    
    26,900
    
    
    
    23,182
    
    
    
    71,896
    
    
    
    63,523Parent company debt obligations
    
    
    25,627
    
    
    
    2,558
    
    
    
    50,345
    
    
    
    6,935Total interest expense
    
    $
    137,602
    
    
    $
    88,533
    
    
    $
    341,949
    
    
    $
    247,661
   Other Income, Net
  71




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##### Table of Contents



Minority
Interest Expense
  For the Three Months
    
    For the Nine MonthsEnded September 30,
    
    Ended September 30,2007
    
    
    
    2006
    
    
    
    2007
    
    
    
    2006Limited partners of Enterprise Products Partners
    
    $
    85,669
    
    
    $
    176,341
    
    
    $
    278,077
    
    
    $
    383,312Limited partners of Duncan Energy Partners
    
    
    3,242
    
    
    
    
    
    
    
    9,356
    
    
    
    Related party former owners of TEPPCO GP
    
    
    
    
    
    
    3,465
    
    
    
    
    
    
    
    12,253Limited partners of TEPPCO
    
    
    37,783
    
    
    
    29,048
    
    
    
    181,716
    
    
    
    90,092Joint venture partners
    
    
    4,539
    
    
    
    1,939
    
    
    
    9,826
    
    
    
    4,675Total
    
    $
    131,233
    
    
    $
    210,793
    
    
    $
    478,975
    
    
    $
    490,332
  Significant
Risks and Uncertainties
 Weather-Related Risks  Enterprise Products Partners
 FERC Investigation  Energy Transfer Equity
  72




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##### Table of Contents



Liquidity and Capital Resources
 Parent
Company Information
    For the Nine MonthsEnded September 30,2007
    
    2006Net cash provided by operating activities (1)
    
    $
    129,831
    
    
    $
    120,074Cash used in investing activities(2)
    
    
    1,650,467
    
    
    
    18,920Cash provided by (used in) financing activities (3)
    
    
    1,519,979
    
    
    
    (101,087
    )Cash and cash equivalents, end of period
    
    
    126
    
    
    
    575
 
 (1)
    
    Primarily represents distributions received from unconsolidated affiliates less cash payments for
interest and general and administrative amounts. See following table for detailed information regarding
distributions from unconsolidated affiliates.(2)
    
    Primarily represents investments in unconsolidated affiliates.(3)
    
    Primarily represents net cash proceeds from borrowings and equity offerings offset by repayments of
debt principal and distribution payments to unitholders.  For the Nine MonthsEnded September 30,2007
    
    2006Cash distributions from investees:Investment in Enterprise Products Partners (EPD):From 13,454,498 common units of EPD
    
    $
    19,173
    
    
    $
    17,962From 2% general partner interest in EPD
    
    
    12,597
    
    
    
    11,041From general partner incentive distribution rights in distributions of EPD
    
    
    76,266
    
    
    
    60,591Investment in TEPPCO:From 4,400,000 common units of TEPPCO
    
    
    8,998
    
    
    
    8,045From 2% general partner interest in TEPPCO
    
    
    3,748
    
    
    
    2,971From general partner incentive distribution rights in distributions of TEPPCO
    
    
    32,106
    
    
    
    31,882Investment in Energy Transfer Equity:From 38,976,090 common units of Energy Transfer Equity
    
    
    14,519
    
    
    
    From 34.9% general partner interest in Energy Transfer Equity
    
    
    90
    
    
    
    Total cash distributions from unconsolidated affiliates
    
    $
    167,497
    
    
    $
    132,492Distributions by the parent company:EPCO and affiliates
    
    $
    89,813
    
    
    $
    68,097Public
    
    
    20,552
    
    
    
    10,565General partner interest
    
    
    11
    
    
    
    8Total distributions by the parent company
    
    $
    110,376
    
    
    $
    78,670
 73




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##### Table of Contents



§
    
    $155.0 million to repay principal outstanding under the EPE Revolver; and§
    
    $1.20 billion under the EPE Term Loan (Debt Bridge) and $500.0 million under the
EPE Term Loan (Equity Bridge) to fund the $1.65 billion cash purchase for the
acquisition of membership interests in ETEGP and common units of Energy Transfer
Equity.
   Consolidated Information
  74




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##### Table of Contents



For the Nine MonthsEnded September 30,2007
    
    2006Net cash flow provided by operating activities:EPGP and subsidiaries (1)
    
    $
    935,756
    
    
    $
    985,410TEPPCO GP and subsidiaries(2)
    
    
    219,161
    
    
    
    232,602Parent company(3)
    
    
    129,831
    
    
    
    120,074Eliminations and adjustments (4)
    
    
    (148,153
    )
    
    
    (106,481
    )Net cash provided by operating activities
    
    $
    1,136,595
    
    
    $
    1,231,605Cash used in investing activities:EPGP and subsidiaries (1)
    
    $
    2,039,495
    
    
    $
    1,217,238TEPPCO GP and subsidiaries(2)
    
    
    182,641
    
    
    
    174,559Parent company(3)
    
    
    1,650,467
    
    
    
    18,920Eliminations and adjustments
    
    
    1,404
    
    
    
    6,870Cash used in investing activities
    
    $
    3,874,007
    
    
    $
    1,417,587Cash provided by (used in) financing activities:EPGP and subsidiaries (1)
    
    $
    1,124,729
    
    
    $
    307,120TEPPCO GP and subsidiaries (2)
    
    
    (36,520
    )
    
    
    (58,004
    )Parent company
    
    
    1,519,979
    
    
    
    (101,087
    )Eliminations and adjustments (4)
    
    
    152,228
    
    
    
    113,350Cash provided by financing activities
    
    $
    2,760,416
    
    
    $
    261,379Cash on hand at end of period (unrestricted):EPGP and subsidiaries(1)
    
    $
    43,956
    
    
    $
    117,433TEPPCO GP and subsidiaries
    
    
    2,559
    
    
    
    158Parent company
    
    
    126
    
    
    
    575Total
    
    $
    46,641
    
    
    $
    118,166
 
 (1)
    
    Represents consolidated cash flow information reported by EPGP and subsidiaries, which includes Enterprise Products Partners.(2)
    
    Represents consolidated cash flow information reported by TEPPCO GP and subsidiaries, which includes TEPPCO.(3)
    
    Equity earnings and distributions from our Investment in Energy Transfer Equity are reflected as net cash flows from operating
activities and our initial investment is reflected in investing activities.(4)
    
    Distributions received by the Parent Company from its Investments in Enterprise Products Partners and TEPPCO and reflected as
operating cash flows are eliminated against cash distributions paid to owners by EPGP, TEPPCO GP and their respective subsidiaries
(as reflected in financing activities).   75




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##### Table of Contents



EPGP and Subsidiaries
  Comparison of Nine Months Ended September 30, 2007 with Nine Months Ended September 30, 2006
 Operating Activities.
 76




---



##### Table of Contents



Investing Activities.
   Financing Activities.
    TEPPCO GP and Subsidiaries
  77




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##### Table of Contents



Comparison of Nine Months Ended September 30, 2007 with Nine Months Ended September 30, 2006
 Operating Activities.
 Investing Activities.
 Financing Activities.
 Other Items
 Contractual Obligations
  Payment or Settlement due by PeriodLess than
    
    1-3
    
    3-5
    
    More thanContractual Obligations
    
    Total
    
    1 year
    
    years
    
    years
    
    5 yearsScheduled maturities of long-term debt:Parent Company(1)
    
    $
    1,083.0
    
    
    $
    
    
    
    $
    
    
    
    $
    233.0
    
    
    $
    850.0Enterprise Products Partners(2)
    
    
    6,796.6
    
    
    
    
    
    
    
    1,069.1
    
    
    
    1,270.0
    
    
    
    4,457.5TEPPCO(3)
    
    
    1,767.0
    
    
    
    
    
    
    
    
    
    
    
    377.0
    
    
    
    1,390.0Estimated cash payments for interest:Parent Company(1)
    
    
    521.0
    
    
    
    78.6
    
    
    
    157.0
    
    
    
    157.0
    
    
    
    128.4Enterprise Products Partners (2)
    
    
    9,133.4
    
    
    
    435.1
    
    
    
    840.5
    
    
    
    652.3
    
    
    
    7,205.5TEPPCO (3)
    
    
    1,928.8
    
    
    
    116.2
    
    
    
    219.1
    
    
    
    187.9
    
    
    
    1,405.6Total
    
    $
    21,229.8
    
    
    $
    629.9
    
    
    $
    2,285.7
    
    
    $
    2,877.2
    
    
    $
    15,437.0
 
 (1)
    
    In August 2007 the parent company completed the refinancing of the amounts then outstanding under the EPE Interim Credit Facility.
For information regarding the parent company debt obligations, see Note 11 of the Notes to Unaudited Condensed Consolidated Financial
Statements included under Item 1 of this quarterly report.(2)
    
    In May 2007, EPO issued $700.0 million of its Junior Notes B. In August 2007, EPO issued $800.0 million of additional senior
notes. The proceeds from these debt offerings were used to temporarily reduce amounts then outstanding under the EPO Revolver and
for EPOs general partnership purposes.(3)
    
    In May 2007, TEPPCO issued $300.0 million of Junior Notes. The proceeds from this debt offering was used to temporarily reduce
amounts then outstanding under the TEPPCO Revolver and for TEPPCOs general partnership purposes. 78




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##### Table of Contents



Off-Balance Sheet Arrangements
   Summary of Related Party Transactions
    Cumulative effect of change in accounting principle
  Recent Accounting Pronouncements
  Amendment to EPE Holdings Limited Liability Company Agreement
  §
    
    to the fullest extent permitted by law, any action (or inaction) taken (or omitted) by
its independent directors consistent with the parent companys Partnership Agreement shall
be permitted and deemed approved by Dan Duncan LLC, the sole member of our general
partner, and shall not constitute a breach of EPE Holdings limited liability company
agreement, the parent companys Partnership Agreement or of any duty stated or implied by
law or equity; and
 79




---



##### Table of Contents



§
    
    the duties and obligations that EPE Holdings officers and directors owe to the parent
company are limited as set forth in the parent companys
Partnership Agreement.
  
 
 Item 3. Quantitative and Qualitative Disclosures about Market Risk.
  Interest Rate Risk Hedging Program
  Parent company.
  Enterprise Products Partners .
   80




---



##### Table of Contents



Resulting
    
    Swap Fair Value atScenario
    
    Classification
    
    Sept. 30, 2007
    
    Oct. 29, 2007FV assuming no change in underlying interest rates
    
    Liability
    
    $
    (19,720
    )
    
    $
    (10,710
    )FV assuming 10% increase in underlying interest rates
    
    Liability
    
    
    (44,353
    )
    
    
    (33,049
    )FV assuming 10% decrease in underlying interest rates
    
    Asset
    
    
    4,914
    
    
    
    11,629
  Notional
    
    CashAmount
    
    Gain (Loss)Treasury lock portfolio, December 31, 2006 (1)
    
    $
    562.5First quarter of 2007 additions to portfolio (1)
    
    
    437.5Second quarter of 2007 terminations (2)
    
    
    (875.0
    )
    
    $
    42.3Third quarter of 2007 additions to portfolio (3)
    
    
    875.0Third quarter of 2007 terminations (4)
    
    
    (750.0
    )
    
    
    6.6Treasury lock portfolio, September 30, 2007 (5)
    
    $
    250.0
    
    
    $
    48.9
  (1)
    
    EPO entered into these transactions related to its anticipated issuances of debt in
2007.(2)
    
    Terminations relate to the issuance of the EPO Junior Notes B ($500.0 million) and EPO
Senior Notes L ($375.0 million). Of the $42.3 million gain, $10.6 million relates to the
EPO Junior Notes B and the remainder to the EPO Senior Notes L and its successor debt.(3)
    
    EPO entered into these transactions related to its issuance of its Senior Notes L
(including its successor debt) in August 2007 ($500.0 million) and anticipated issuance of
debt during the first half of 2008 ($250.0 million)(4)
    
    Terminations relate to the issuance of the EPO Senior Notes L and its successor debt.(5)
    
    The fair value of these financial instruments at September 30, 2007 was $2.9 million.
  TEPPCO .
   Resulting
    
    Swap Fair Value atScenario
    
    Classification
    
    Sept. 30, 2007
    
    Oct. 29, 2007FV assuming no change in underlying interest rates
    
    Asset
    
    $
    609,878
    
    
    $
    251,732FV assuming 10% increase in underlying interest rates
    
    Asset
    
    
    871,198
    
    
    
    251,732FV assuming 10% decrease in underlying interest rates
    
    Asset
    
    
    348,559
    
    
    
    251,732
  81




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##### Table of Contents



Commodity Risk Hedging Program
 Enterprise Products Partners
    Resulting
    
    Portfolio Fair Value atScenario
    
    Classification
    
    Sept. 30, 2007
    
    Oct. 29, 2007FV assuming no change in underlying commodity prices
    
    Liability
    
    $
    (23,392
    )
    
    $
    (21,765
    )FV assuming 10% increase in underlying commodity prices
    
    Liability
    
    
    (10,839
    )
    
    
    (12,724
    )FV assuming 10% decrease in underlying commodity prices
    
    Liability
    
    
    (35,945
    )
    
    
    (30,805
    )
 TEPPCO .
  82




---



##### Table of Contents



Foreign Currency Hedging Program  Enterprise Products Partners
  
 Item 4. Controls and Procedures .
     
 PART II. OTHER INFORMATION.
 
 Item 1. Legal Proceedings .
  
 Item 1A. Risk Factors .
  83




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##### Table of Contents



The FERC and CFTC are pursuing legal actions against ETP relating to certain natural gas trading
and transportation activities, and related third party claims have been filed against Energy
Transfer Equity and ETP.
 Inside FERC
    84




---



##### Table of Contents



Platts Inside
  85




---



##### Table of Contents



Item 2. Unregistered Sales of Equity Securities and Use of Proceeds .
   
 Item 3. Defaults Upon Senior Securities .
  
 Item 4. Submission of Matters to a Vote of Security Holders .
  
 Item 5. Other Information .
  
 Item 6. Exhibits .
 ExhibitNumber
    
    Exhibit*2.1
    
    Securities Purchase Agreement, dated as of May
7, 2007, by and among Enterprise GP Holdings
L.P., Natural Gas Partners VI, L.P., Ray C.
Davis, Avatar Holdings, LLC, Avatar
Investments, LP, Lon Kile, MHT Properties,
Ltd., P. Brian Smith Holdings, LP., and LE GP,
LLC (incorporated by reference to Exhibit 10.1
to Enterprise GP Holdings Form 8-K filed on
May 10, 2007).2.2
    
    Securities Purchase Agreement, dated as of May
7, 2007, by and among Enterprise GP Holdings
L.P., DFI GP Holdings L.P. and Duncan Family
Interests, Inc. (incorporated by reference to
Exhibit 10.4 to Enterprise GP Holdings Form
8-K filed on May 10, 2007).3.1
    
    First Amended and Restated Agreement of
Limited Partnership of Enterprise GP Holdings
L.P., dated as of August 29, 2005
(incorporated by reference to Exhibit 3.1 to
Enterprise GP Holdings Form 10-Q filed
November 4, 2005).3.2
    
    Amendment No. 1 to First Amended and Restated
Agreement of Limited Partnership of Enterprise
GP Holdings L.P., dated as of May 7, 2007
(incorporated by reference to Exhibit 3.1 to
Enterprise GP Holdings Form 8-K filed on May
10, 2007).3.3 #
    
    Third Amended and Restated Limited Liability
Company Agreement of EPE Holdings, LLC, dated
as of November 7, 2007.3.4
    
    Certificate of Limited Partnership of
Enterprise GP Holdings L.P. (incorporated by
reference to Exhibit 3.1 to Amendment No. 2 to
Enterprise GP Holdings Form S-1 Registration
Statement, Reg. No. 333-124320, filed July 21,
2005).3.5
    
    Certificate of Formation of EPE Holdings, LLC
(incorporated by reference to Exhibit 3.2 to
Amendment No. 2 to Enterprise GP Holdings
Form S-1 Registration Statement, Reg. No.
333-124320, filed July 21, 2005).3.6
    
    Fifth Amended and Restated Agreement of
Limited Partnership of Enterprise Products
Partners L.P., dated effective as of August 8,
2005 (incorporated by reference to Exhibit 3.1
to Enterprise Products Partners Form 8-K
filed August 10, 2005).3.7
    
    Fifth Amended and Restated Limited Liability
Company Agreement of Enterprise Products GP,
LLC, dated as of November 7, 2007
(incorporated by reference to Exhibit 3.2 to
Enterprise Products Partners Form 10-Q filed
November 9, 2007).3.8
    
    Amended and Restated Limited Liability Company
Agreement of Texas Eastern Products
 86




---



##### Table of Contents



ExhibitNumber
    
    Exhibit*Pipeline
Company, LLC dated May 7, 2007 (incorporated
by reference to Exhibit 3 to the Current
Report on Form 8-K of TEPPCO Partners, L.P.
(commission File No. 1-10403) filed on May 10,
2007).3.9
    
    Fourth Amended and Restated Agreement of
Limited Partnership of TEPPCO Partners, L.P.,
dated December 8, 2006 (Filed as Exhibit 3 to
the Current Report on Form 8-K of TEPPCO
Partners, L.P. (Commission File No. 1-10403)
filed on December 13, 2006).4.1
    
    Specimen Unit certificate (incorporated by
reference to Exhibit 4.1 to Amendment No. 3 to
Enterprise GP Holdings Form S-1 Registration
Statement, Reg. No. 333-124320, filed August
11, 2005).4.2
    
    Registration Rights Agreement dated as of July
17, 2007 by and among Enterprise GP Holdings
L.P. and the Purchasers named therein
(incorporated by reference to Exhibit 10.2 to
Enterprise GP Holdings Form 8-K filed on July
12, 2007).4.3
    
    Second Amended and Restated Credit Agreement,
dated as of May 1, 2007, by and among
Enterprise GP Holdings L.P., as Borrower, the
Lenders named therein, Citicorp North America,
Inc., as Administrative Agent, Lehman
Commercial Paper Inc., as Syndication Agent,
Citibank, N.A., as Issuing Bank, and The Bank
of Nova Scotia, Sun Trust Bank and Mizuho
Corporate Bank, Ltd., as Co-Documentation
Agent (incorporated by reference to Exhibit
10.5 to Enterprise GP Holdings Form 8-K filed
on May 10, 2007).4.4
    
    Unit Purchase Agreement dated as of July 13,
2007 by and among Enterprise GP Holdings L.P.,
EPE Holdings, LLC and the Purchasers named
therein (incorporated by reference to Exhibit
10.1 to Form 8-K filed on July 18, 2007).4.5
    
    Registration Rights Agreement dated as of July
17, 2007 by and among Enterprise GP Holdings
L.P. and the Purchasers named therein
(incorporated by reference to Exhibit 10.2 to
Form 8-K filed on July 18, 2007).31.1 #
    
    Sarbanes-Oxley Section 302 certification of
Dr. Ralph S. Cunningham for Enterprise GP
Holdings L.P. with respect to the September
30, 2007 Quarterly Report on Form 10-Q.31.2 #
    
    Sarbanes-Oxley Section 302 certification of W.
Randall Fowler for Enterprise GP Holdings L.P.
with respect to the September 30, 2007
Quarterly Report on Form 10-Q.32.1 #
    
    Section 1350 certification of Dr. Ralph S.
Cunningham for the September 30, 2007
Quarterly Report on Form 10-Q.32.2 #
    
    Section 1350 certification of W. Randall
Fowler for the September 30, 2007 Quarterly
Report on Form 10-Q.
 
 *
    
    With respect to any exhibits incorporated by reference to any Exchange Act filings, the
Commission file numbers for Enterprise Products Partners, Duncan Energy Partners and TEPPCO are
1-14323, 1-33266 and 1-10403, respectively.#
    
    Filed with this report. 87




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##### Table of Contents



SIGNATURES
  ENTERPRISE GP HOLDINGS L.P.
(A Delaware Limited Partnership)By:
    
    EPE Holdings, LLC,
as General PartnerBy:
    
    /s/ Michael J. KnesekName:
    
    Michael J. KnesekTitle:
    
    Senior Vice President, Controller
and Principal Accounting Officer
of the General Partner
 88




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##### Table of Contents



Index to Exhibits
 ExhibitNumber
    
    Exhibit*2.1
    
    Securities Purchase Agreement, dated as of May
7, 2007, by and among Enterprise GP Holdings
L.P., Natural Gas Partners VI, L.P., Ray C.
Davis, Avatar Holdings, LLC, Avatar
Investments, LP, Lon Kile, MHT Properties,
Ltd., P. Brian Smith Holdings, LP., and LE GP,
LLC (incorporated by reference to Exhibit 10.1
to Enterprise GP Holdings Form 8-K filed on
May 10, 2007).2.2
    
    Securities Purchase Agreement, dated as of May
7, 2007, by and among Enterprise GP Holdings
L.P., DFI GP Holdings L.P. and Duncan Family
Interests, Inc. (incorporated by reference to
Exhibit 10.4 to Enterprise GP Holdings Form
8-K filed on May 10, 2007).3.1
    
    First Amended and Restated Agreement of
Limited Partnership of Enterprise GP Holdings
L.P., dated as of August 29, 2005
(incorporated by reference to Exhibit 3.1 to
Enterprise GP Holdings Form 10-Q filed
November 4, 2005).3.2
    
    Amendment No. 1 to First Amended and Restated
Agreement of Limited Partnership of Enterprise
GP Holdings L.P., dated as of May 7, 2007
(incorporated by reference to Exhibit 3.1 to
Enterprise GP Holdings Form 8-K filed on May
10, 2007).3.3 #
    
    Third Amended and Restated Limited Liability
Company Agreement of EPE Holdings, LLC, dated
as of November 7, 2007.3.4
    
    Certificate of Limited Partnership of
Enterprise GP Holdings L.P. (incorporated by
reference to Exhibit 3.1 to Amendment No. 2 to
Enterprise GP Holdings Form S-1 Registration
Statement, Reg. No. 333-124320, filed July 21,
2005).3.5
    
    Certificate of Formation of EPE Holdings, LLC
(incorporated by reference to Exhibit 3.2 to
Amendment No. 2 to Enterprise GP Holdings
Form S-1 Registration Statement, Reg. No.
333-124320, filed July 21, 2005).3.6
    
    Fifth Amended and Restated Agreement of
Limited Partnership of Enterprise Products
Partners L.P., dated effective as of August 8,
2005 (incorporated by reference to Exhibit 3.1
to Enterprise Products Partners Form 8-K
filed August 10, 2005).3.7
    
    Fifth Amended and Restated Limited Liability
Company Agreement of Enterprise Products GP,
LLC, dated as of November 7, 2007
(incorporated by reference to Exhibit 3.2 to
Enterprise Products Partners Form 10-Q filed
November 9, 2007).3.8
    
    Amended and Restated Limited Liability Company
Agreement of Texas Eastern Products Pipeline
Company, LLC dated May 7, 2007 (incorporated
by reference to Exhibit 3 to the Current
Report on Form 8-K of TEPPCO Partners, L.P.
(commission File No. 1-10403) filed on May 10,
2007).3.9
    
    Fourth Amended and Restated Agreement of
Limited Partnership of TEPPCO Partners, L.P.,
dated December 8, 2006 (Filed as Exhibit 3 to
the Current Report on Form 8-K of TEPPCO
Partners, L.P. (Commission File No. 1-10403)
filed on December 13, 2006).4.1
    
    Specimen Unit certificate (incorporated by
reference to Exhibit 4.1 to Amendment No. 3 to
Enterprise GP Holdings Form S-1 Registration
Statement, Reg. No. 333-124320, filed August
11, 2005).4.2
    
    Registration Rights Agreement dated as of July
17, 2007 by and among Enterprise GP Holdings
L.P. and the Purchasers named therein
(incorporated by reference to Exhibit 10.2 to
Enterprise GP Holdings Form 8-K filed on July
12, 2007).4.3
    
    Second Amended and Restated Credit Agreement,
dated as of May 1, 2007, by and among
Enterprise GP Holdings L.P., as Borrower, the
Lenders named therein, Citicorp North America,
Inc., as Administrative Agent, Lehman
Commercial Paper Inc., as Syndication Agent,
Citibank, N.A., as Issuing Bank, and The Bank
of Nova Scotia, Sun Trust Bank and Mizuho
Corporate Bank, Ltd., as Co-Documentation
Agent (incorporated by reference to Exhibit
10.5 to Enterprise GP Holdings Form 8-K filed
on May 10, 2007).4.4
    
    Unit Purchase Agreement dated as of July 13,
2007 by and among Enterprise GP Holdings L.P.,
EPE Holdings, LLC and the Purchasers named
therein (incorporated by reference to Exhibit
10.1 to Form 8-K filed on July 18, 2007).4.5
    
    Registration Rights Agreement dated as of July
17, 2007 by and among Enterprise GP Holdings
L.P. and the Purchasers named therein
(incorporated by reference to Exhibit 10.2 to
Form 8-K




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##### Table of Contents



ExhibitNumber
    
    Exhibit*filed on July 18, 2007).31.1 #
    
    Sarbanes-Oxley Section 302 certification of
Dr. Ralph S. Cunningham for Enterprise GP
Holdings L.P. with respect to the September
30, 2007 Quarterly Report on Form 10-Q.31.2 #
    
    Sarbanes-Oxley Section 302 certification of W.
Randall Fowler for Enterprise GP Holdings L.P.
with respect to the September 30, 2007
Quarterly Report on Form 10-Q.32.1 #
    
    Section 1350 certification of Dr. Ralph S.
Cunningham for the September 30, 2007
Quarterly Report on Form 10-Q.32.2 #
    
    Section 1350 certification of W. Randall
Fowler for the September 30, 2007 Quarterly
Report on Form 10-Q.
 
 *
    
    With respect to any exhibits incorporated by reference to any Exchange Act filings, the
Commission file numbers for Enterprise Products Partners, Duncan Energy Partners and TEPPCO are
1-14323, 1-33266 and 1-10403, respectively.#
    
    Filed with this report.