Discontinued Operations
Discontinued operations in 2012 and 2011 were mostly comprised of the net effects of a settlement arrangement related to prior liquefied natural gas (LNG) contracts.
The following table summarizes results classified as Income From Discontinued Operations, Net of Tax in the accompanying Consolidated Statements of Operations:
|
| | | | | | | |
| 2012 | | 2011 |
| (in millions) |
Operating revenues | $ | 99 |
| | $ | 251 |
|
Pre-tax earnings | 4 |
| | 39 |
|
Income tax expense | 2 |
| | 14 |
|
Income from discontinued operations, net of tax | 2 |
| | 25 |
|
Spectra Energy LNG Sales, Inc. (Spectra Energy LNG) reached a settlement agreement in 2007 related to an arbitration proceeding regarding Spectra Energy LNG’s claims for the period prior to May 2002 under certain liquefied natural gas LNG transportation contracts with Sonatrach and Sonatrading Amsterdam B.V. (Sonatrach). Spectra Energy LNG was one of the entities contributed to us by Duke Energy in connection with our spin-off from Duke Energy and has been reflected as discontinued operations. In 2008, Sonatrach and Spectra Energy entered into a settlement agreement under which Spectra Energy LNG’s claims for the period after May 2002 were to be satisfied pursuant to commercial transactions involving the purchase of propane by Spectra Energy Propane, LLC (a subsidiary) from Sonatrach. We subsequently entered into associated agreements with what are now affiliates of DCP Midstream for the sale of this propane. Net purchases and sales of propane under these arrangements are reflected as discontinued operations within the “Other” business segment. Purchases and sales of propane under these agreements ended in 2012.
