Energy Transfer 2010 Annual Report Download - page 77

which also led to a reduction in our reserve for bad debts, and a decrease of $2.9 million related to cost control
initiatives from our operations. These decreases were offset by an increase in payroll costs of $3.9 million due to
an increase related to additional employees from acquisitions in the latter part of 2008, merit increases, and an
increase in medical expenses of $4.2 million. Our business insurance reserves and claims also increased by $5.2
million.
Depreciation and Amortization Expense. The increase in depreciation and amortization expense was primarily
related to assets added through acquisitions in the latter part of 2008.
Selling, General and Administrative. The increase in selling, general and administrative expenses between
comparable periods was primarily due to increased administrative expense allocations of $1.5 million offset by a
reduction in other non-recurring expenses incurred during the prior periods.
Liquidity and Capital Resources
Our ability to satisfy our obligations and pay distributions to our Unitholders will depend on our future
performance, which will be subject to prevailing economic, financial, business and weather conditions, and other
factors, many of which are beyond management’s control.
We currently believe that our business has the following future capital requirements:
• growth capital expenditures for our midstream and intrastate transportation and storage segments primarily
for the construction of new pipelines and compression, for which we expect to spend between $500.0 million
and $550.0 million in 2011;
• growth capital expenditures for our interstate transportation segment, excluding capital contributions to our
joint ventures as discussed below, for the construction of new pipelines for which we expect to spend
between $250.0 million and $300.0 million in 2011;
• growth capital expenditures for our retail propane segment of between $25.0 million and $35.0 million in
2011; and
• maintenance capital expenditures of between $120.0 million and $140.0 million during 2011, which include
(i) capital expenditures for our intrastate operations for pipeline integrity and for connecting additional wells
to our intrastate natural gas systems in order to maintain or increase throughput on existing assets; (ii) capital
expenditures for our interstate operations, primarily for pipeline integrity; and (iii) capital expenditures for
our propane operations to extend the useful lives of our existing propane assets in order to sustain our
operations, including vehicle replacements on our propane vehicle fleet.
In addition to the capital expenditures noted above, we expect to make capital contributions to our joint ventures
of between $200.0 million and $230 million in 2011.
In addition, we may enter into acquisitions, including the potential acquisition of new pipeline systems and
propane operations.
We generally fund our capital requirements with cash flows from operating activities and, to the extent that they
exceed cash flows from operating activities, with proceeds of borrowings under existing credit facilities, long-
term debt, the issuance of additional Common Units or a combination thereof.
During the year ended December 31, 2010, we raised approximately $1.15 billion in net proceeds from Common
Unit issuances, including $239.3 million in net proceeds under an equity distribution program, as described in
Note 7 to our consolidated financial statements. Proceeds from Common Unit issuances were used to repay
amounts outstanding under our revolving credit facility and to fund capital expenditures and capital contributions
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