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UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


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

For the quarterly period ended ~~September~~March 3031, ~~2023~~2024


☐			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 1-7414

Northwest Pipeline LLC

(Exact name of registrant as specified in its charter)

Delaware

26-1157701

(State or other jurisdiction of incorporation or organization)

(I.R.S. Employer Identification No.)

One Williams Center

Tulsa, Oklahoma

74172-0172

(Address of principal executive offices)

(Zip Code)

Registrant’s telephone number, including area code: (800) 945-5426

NO CHANGE

(Former name, former address, and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act: None

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

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes þ No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No þ

THE REGISTRANT MEETS THE CONDITIONS SET FORTH IN GENERAL INSTRUCTIONS H(1)(a) AND (b) OF FORM 10-Q AND IS THEREFORE FILING THIS FORM 10-Q WITH THE REDUCED DISCLOSURE FORMAT.


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Northwest Pipeline LLC

Index

			Page
Part I. Financial Information
Item 1. Financial Statements
Statement of Net Income – Three and Nine Months Ended September 30, 2023 and 2022			4
Statement of Net Income – Three Months Ended March 31, 2024 and 2023			4
Balance Sheet – September 30, 2023 and December 31, 2022			5
Balance Sheet – March 31, 2024 and December 31, 2023			5
Statement of Changes in Member’s Equity – Three and Nine Months Ended September 30, 2023 and 2022			7
Statement of Changes in Member’s Equity – Three Months Ended March 31 2024 and 2023			7
Statement of Cash Flows – Nine Months Ended September 30, 2023 and 2022			8
Statement of Cash Flows – Three Months Ended March 31, 2024 and 2023			8
Notes to Financial Statements			9
Note 1 – Basis of Presentation			9
Note 2 – Revenue Recognition			9
Note 3 – Rate and Regulatory Matters			11
Note 4 – Contingent Liabilities and Commitments			11
Note 5 – Debt and Financing Arrangements			13
Note 6 – Fair Value Measurements			13
Note 7 – Transactions with Affiliates			13
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			15
Item 4. Controls and Procedures			16
Part II. Other Information			16
Item 1. Legal Proceedings			16
Item 1A. Risk Factors			17
Item 6. Exhibits			18

FORWARD-LOOKING STATEMENTS

The reports, filings, and other public announcements of Northwest Pipeline LLC may contain or incorporate by reference statements that do not directly or exclusively relate to historical facts. Such statements are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (Securities Act), and Section 21E of the Securities Exchange Act of 1934, as amended (Exchange Act). These forward-looking statements relate to anticipated financial performance, management’s plans and objectives for future operations, business prospects, outcome of regulatory proceedings, market conditions, and other matters.

All statements, other than statements of historical facts, included in this report that address activities, events, or developments that we expect, believe, or anticipate will exist or may occur in the future are forward-looking statements. Forward-looking statements can be identified by various forms of words such as “anticipates,” “believes,” “seeks,” “could,” “may,” “should,” “continues,” “estimates,” “expects,” “forecasts,” “intends,” “might,” “goals,” “objectives,” “targets,” “planned,” “potential,” “projects,” “scheduled,” “will,” “assumes,” “guidance,” “outlook,” “in-service date,” or other similar expressions. These forward-looking statements are based on management’s beliefs and assumptions and on information currently available to management and include, among others, statements regarding:

•Our and our affiliates’ future credit ratings;

•Amounts and nature of future capital expenditures;

•Expansion and growth of our business and operations;

•Expected in-service dates for capital projects;


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•Expected in-service dates for capital projects;

•Financial condition and liquidity;

•Business strategy;

•Cash flow from operations or results of operations;

•Rate case filings;

•Natural gas prices, supply, and demand; and

•Demand for our services.

Forward-looking statements are based on numerous assumptions, uncertainties, and risks that could cause future events or results to be materially different from those stated or implied in this report. Many of the factors that will determine these results are beyond our ability to control or predict. Specific factors that could cause actual results to differ from results contemplated by the forward-looking statements include, among others, the following:

•The impact of operational and developmental hazards and unforeseen interruptions;

•Development and rate of adoption of alternative energy sources;

•The strength and financial resources of our competitors and the effects of competition;

•Availability of supplies, including lower than anticipated volumes from third parties, and market demand;

•Volatility of pricing including the effect of lower than anticipated energy commodity prices;

•Changes in maintenance and construction costs, as well as our ability to obtain sufficient construction-related inputs, including skilled labor;

•The impact of existing and future laws and regulations, the regulatory environment, environmental matters, and litigation, as well as our ability and the ability of other energy companies, with whom we conduct or seek to conduct business, to obtain necessary permits and approvals, and our ability to achieve favorable rate proceeding outcomes;

•Increasing scrutiny and changing expectations from stakeholders with respect to our environmental, social, and governance practices;

•The physical and financial risks associated with climate change;

•Our exposure to the credit risk of our customers and counterparties;

•Our ability to successfully expand our facilities and operations;

•Whether we are able to successfully identify, evaluate, and timely execute our capital projects and investment opportunities;

•Risks related to financing, including restrictions stemming from debt agreements, future changes in credit ratings as determined by nationally recognized credit rating agencies, and the availability and cost of capital;


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•Inflation, interest rates, and general economic conditions (including future disruptions and volatility in the global credit markets and the impact of these events on customers and suppliers);

•Our costs for defined benefit pension plans and other postretirement benefit plans sponsored by our affiliates;

•The risks resulting from outbreaks or other public health crises~~, including COVID-19~~;

•Changes in the current geopolitical situation, including the Russian invasion of Ukraine and conflicts in the ~~developing~~Middle ~~conflict~~East including between Israel and Hamas and conflicts involving Iran and its proxy forces;

•Changes in U.S. governmental administration and policies;

•Risks associated with weather and natural phenomena, including climate conditions and physical damage to our facilities;

•Acts of terrorism, cybersecurity incidents, and related disruptions; and

•Additional risks described in our filings with the Securities and Exchange Commission (SEC).

Given the uncertainties and risk factors that could cause our actual results to differ materially from those contained in any forward-looking statement, we caution investors not to unduly rely on our forward-looking statements. We disclaim any obligations to and do not intend to update the above list or announce publicly the result of any revisions to any of the forward-looking statements to reflect future events or developments.

In addition to causing our actual results to differ, the factors listed above and referred to below may cause our intentions to change from those statements of intention set forth in this report. Such changes in our intentions may also cause our results to differ. We may change our intentions, at any time and without notice, based upon changes in such factors, our assumptions, or otherwise.

Because forward-looking statements involve risks and uncertainties, we caution that there are important factors, in addition to those listed above, that may cause actual results to differ materially from those contained in the forward-looking statements. For a detailed discussion of those factors, see Part I, Item 1A. Risk Factors in our Annual Report on Form 10-K for the year ended December 31, ~~2022~~2023, as filed with the SEC on February 2721, ~~2023 as may be supplemented by disclosure in Part II, Item 1A~~2024. ~~Risk Factors in subsequent Quarterly Reports on Form 10-Q.~~


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PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

Northwest Pipeline LLC

Statement of Net Income

(Unaudited)

Three Months EndedSeptember 30,

Nine Months EndedSeptember 30,

Three Months EndedMarch 31,

2023

2022

2023

2022

2024

2023

~~(Thousands)~~

(Thousands)

Operating Revenues:

Natural gas transportation

~~101,914~~

~~105,193~~

~~308~~109,~~469~~864

~~319~~106,~~113~~096

Natural gas storage

~~3,662~~

~~3,294~~

113,~~700~~718

93,~~701~~475

Other

~~2,307~~

~~1,271~~

73,~~498~~189

2,~~621~~825

Total operating revenues

~~107,883~~

~~109,758~~

~~327~~116,~~667~~771

~~331~~112,~~435~~396

Operating Expenses:

Operation and maintenance

~~24,201~~

~~23,143~~

6322,~~875~~124

6319,~~629~~516

General and administrative

~~11,321~~

~~13,448~~

3611,~~674~~629

3812,~~237~~858

Depreciation and amortization

~~27,799~~

~~28,510~~

8327,~~852~~465

8527,~~659~~877

Taxes — other than income taxes

1,576

4,022

9,212

12,452

Taxes, other than income taxes

3,470

3,619

Regulatory charges resulting from tax rate changes

—

5,944

—

17,637

Other (income) expense, net

(3,893)

(4,572)

Other (income) expense, net

(3,600)

821

(12,609)

1,544

Total operating expenses

60,795

59,298

Total operating expenses

61,297

75,888

181,004

219,158

Operating Income

55,976

53,098

Operating Income

46,586

33,870

146,663

112,277

Other (Income) and Other Expenses:

Interest expense

~~6,849~~

~~7,853~~

217,~~069~~139

237,~~172~~430

Allowance for equity and borrowed funds used during construction (AFUDC)

~~(1,153)~~

~~(885)~~

(21,~~535~~626)

(~~2,354~~846)

Miscellaneous other (income) expense, net

~~(2,239)~~

~~(1,914)~~

(62,~~930~~632)

(32,~~515~~524)

Total other (income) and other expenses

~~3,457~~

~~5,054~~

112,~~604~~881

174,~~303~~060

Net Income

~~43,129~~

~~28,816~~

~~135~~53,~~059~~095

9449,~~974~~038

See accompanying notes.


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Northwest Pipeline LLC

Balance Sheet

(Unaudited)

	September 30,2023		December 31,2022
	March 31,2024		December 31,2023
	(Thousands)
ASSETS
Current Assets:
Cash	$	—	$	—
Receivables:
Advances to affiliate	~~164~~169,~~314~~050		~~310~~157,~~641~~776
Trade	3538,~~140~~360		39,~~746~~080
Affiliates	~~1,549~~788		1,~~829~~375
Other	~~249~~1,242		~~606~~1,485
Materials and supplies, at average cost	87,~~788~~801		87,~~925~~759
Exchange gas due from others	3,623		35,851
Exchange gas receivables	2,841		3,165
Regulatory assets	12,~~991~~111		132,~~565~~054
Prepayments and other	3,033		3,627
Other	2,359		1,801
Total current assets	~~218~~224,~~687~~552		~~414~~214,~~790~~495
Property, plant and equipment	3,~~937~~993,~~178~~717		3,~~836~~974,~~254~~900
Less-Accumulated depreciation and amortization	2,~~005~~038,~~965~~518		12,~~941~~026,~~806~~007
Total property, plant and equipment, net	1,~~931~~955,~~213~~199		1,~~894~~948,~~448~~893
Other Assets:
Other Long-Term Assets:
Regulatory assets	3136,~~175~~475		1535,~~951~~796
Right-of-use assets	8,~~950~~775		98,~~621~~725
Deferred charges and other long-term assets	18,396		15,167
Deferred charges and other	20,454		19,450
Total other assets	58,521		40,739
Total long-term other assets	65,704		63,971
Total assets	$	2,~~208~~245,~~421~~455	$	2,~~349~~227,~~977~~359

(continued)

See accompanying notes.


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Northwest Pipeline LLC

Balance Sheet

(Unaudited)

	September 30,2023		December 31,2022
	March 31,2024		December 31,2023
	(Thousands)
LIABILITIES AND MEMBER’S EQUITY
Current Liabilities:
Payables:
Trade	$	4938,~~970~~968	$	2547,~~761~~822
Affiliates	9,~~083~~865		12,~~115~~780
Accrued liabilities:
Exchange gas due to others	5,032		42,451
Exchange gas payables	1,950		5,553
Regulatory liabilities	2120,~~819~~358		~~145~~21,~~243~~374
Taxes — other than income taxes	8,976		10,853
Taxes, other than income taxes	10,442		7,388
Interest	12,019		5,505
Customer advances	27,~~800~~074		45,~~415~~016
Other	816,~~640~~282		410,~~011~~588
Total current liabilities	~~118~~116,~~339~~958		~~250~~116,~~354~~026
Long-Term Debt	~~580~~581,~~900~~459		~~580~~581,~~083~~178
Other Long-Term Liabilities:
Regulatory liabilities	~~257~~247,~~204~~487		~~271~~252,~~706~~272
Asset retirement obligations	~~134~~138,~~534~~115		~~129~~136,~~306~~263
Lease liability	7,~~304~~266		7,~~857~~193
Other	~~1,604~~879		21,~~394~~231
Total other long-term liabilities	~~400~~393,~~646~~747		~~411~~396,~~263~~959
Contingent Liabilities and Commitments (Note 4)
Member’s Equity:
Member’s capital	1,073,892		1,073,892
Retained earnings	3479,~~644~~399		3459,~~385~~304
Total member’s equity	1,~~108~~153,~~536~~291		1,~~108~~133,~~277~~196
Total liabilities and member’s equity	$	2,~~208~~245,~~421~~455	$	2,~~349~~227,~~977~~359

See accompanying notes.


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Northwest Pipeline LLC

Statement of Changes in Member’s Equity

(Unaudited)

	Three Months EndedSeptember 30,
	Three Months EndedMarch 31,
	2023		2022
	2024		2023
	(Thousands)
Member’s Capital:
Balance at beginning and end of period	$	1,073,892	$	1,073,892
Retained Earnings:
Balance at beginning of period	2859,~~515~~304		2334,~~169~~385
Net income	4353,~~129~~095		2849,~~816~~038
Cash distributions to parent	(3733,000)		(2935,~~500~~800)
Balance at end of period	3479,~~644~~399		2247,~~485~~623
Total Member’s Equity	$	1,~~108~~153,~~536~~291	$	1,~~096~~121,~~377~~515
	Nine Months EndedSeptember 30,
	2023		2022
	(Thousands)
Member’s Capital:
Balance at beginning and end of period	$	1,073,892	$	1,073,892
Retained Earnings:
Balance at beginning of period	34,385		35,511
Net income	135,059		94,974
Cash distributions to parent	(134,800)		(108,000)
Balance at end of period	34,644		22,485
Total Member’s Equity	$	1,108,536	$	1,096,377

See accompanying notes.


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Northwest Pipeline LLC

Statement of Cash Flows

(Unaudited)

	Nine Months EndedSeptember 30,
	Three Months EndedMarch 31,
	2023		2022
	2024		2023
	(Thousands)
OPERATING ACTIVITIES:
Net income	$	~~135~~53,~~059~~095	$	9449,~~974~~038
Adjustments to reconcile net cash provided (used) by operating activities:
Depreciation and amortization	8327,~~852~~465		8527,~~659~~877
Regulatory charges resulting from tax rate changes	—		17,637
Allowance for equity funds used during construction (equity AFUDC)	(1,334)		(693)
Allowance for equity funds used during construction (equity AFUDC)	(2,085)		(1,853)
Changes in current assets and liabilities:
Trade and other accounts receivable	4,963		32,~~911~~497
Affiliate receivables	~~280~~587		~~109~~(24)
Materials and supplies	~~137~~(42)		58(16)
Regulatory assets	(~~260~~54)		(~~374~~71)
Other current assets	~~189~~(552)		~~(75)~~1,188
Trade accounts payable	(~~173~~5,429)		(~~890~~358)
Affiliate payables	(32,~~032~~915)		(21,~~513~~319)
Regulatory liabilities	(~~125,502~~3)		~~137~~(125,~~451~~506)
Other accrued liabilities	915,~~176~~262		65,~~675~~622
Other, including changes in long-term assets and liabilities:
Regulatory assets	(21,870)		(4,458)
Other, net	(6,570)		(10,575)
Regulatory liabilities	(14,647)		(133,578)
Net cash provided (used) by operating activities	80,473		(52,340)
Other, net	3,442		3,678
Net cash provided (used) by operating activities	69,529		206,411
FINANCING ACTIVITIES:
Cash distributions to parent	(~~134~~33,~~800~~000)		(~~108~~35,~~000~~800)
Net cash provided (used) by financing activities	(~~134~~33,~~800~~000)		(~~108~~35,~~000~~800)
INVESTING ACTIVITIES:
Property, plant and equipment:
Capital expenditures (1)	(7740,~~263~~391)		(6022,~~637~~038)
Contributions and advances for construction costs	32,~~445~~995		101,~~042~~657
Disposal of property, plant and equipment, net	(71,~~238)~~197		(~~4,462~~411)
Advances to affiliate, net	~~146~~(11,~~327~~274)		~~(43~~108,~~354)~~932
Net cash provided (used) by investing activities	65(47,~~271~~473)		~~(98~~88,~~411)~~140
Increase (decrease) in cash	—		—
Cash at beginning of period	—		—
Cash at end of period	$	—	$	—
____________________________________
(1) Increases to property, plant and equipment, exclusive of equity AFUDC	$	(9837,~~340~~111)	$	(7310,~~267~~613)
Changes in related accounts payable and accrued liabilities	21(3,~~077~~280)		12(11,~~630~~425)
Capital expenditures	$	(7740,~~263~~391)	$	(6022,~~637~~038)

See accompanying notes.


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Northwest Pipeline LLC

Notes to Financial Statements

(Unaudited)

Note 1 – Basis of Presentation

In this report, Northwest Pipeline LLC (Northwest) is at times referred to in the first person as “we,” “us,” or “our.”

Northwest is indirectly owned by The Williams Companies, Inc. (Williams), a publicly traded Delaware corporation. We own and operate an interstate natural gas pipeline system that is regulated by the Federal Energy Regulatory Commission (FERC).

General

Our accompanying interim financial statements do not include all the notes in our annual financial statements and, therefore, should be read in conjunction with our financial statements and notes thereto for the year ended December 31, ~~2022~~2023, in our Annual Report on Form 10-K. The accompanying unaudited financial statements include all normal recurring adjustments and others that, in the opinion of management, are necessary to present fairly our interim financial statements.

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in our financial statements and accompanying notes. Actual results could differ from those estimates.

Note 2 – Revenue Recognition

Revenue by Category

Our revenue disaggregation by major service line includes Natural gas transportation, Natural gas storage, and Other, which are separately presented on the Statement of Net Income.

Contract Assets

The following table presents a reconciliation of our contract assets:

~~Three Months Ended~~

Three Months Ended

~~Nine Months Ended~~

September 30,

March 31,

2023

2022

2023

2022

2024

2023

~~(Thousands)~~

(Thousands)

Balance at beginning of period

~~14,630~~

~~10,198~~

1216,~~490~~806

712,~~943~~490

Revenue recognized in excess of amounts invoiced

~~1,088~~

~~1,146~~

31,~~228~~076

31,~~401~~064

Balance at end of period

~~15,718~~

~~11,344~~

1517,~~718~~882

1113,~~344~~554


Notes (Continued)			Table of Contents

Contract Liabilities

The following table presents a reconciliation of our contract liabilities:

~~Three Months Ended~~

Three Months Ended

~~Nine Months Ended~~

September 30,

March 31,

2023

2022

2023

2022

2024

2023

~~(Thousands)~~

(Thousands)

Balance at beginning of period

~~2,060~~

~~3,161~~

21,~~643~~468

32,~~672~~643

Recognized in revenue

~~(296)~~

~~(259)~~

(~~879~~293)

(~~770~~290)

Balance at end of period

~~1,764~~

~~2,902~~

1,~~764~~175

2,~~902~~353

Remaining Performance Obligations

Our remaining performance obligations primarily include reservation charges on contracted capacity on our firm transportation and storage contracts with customers. Amounts from certain contracts included in the table below, which are subject to periodic review and approval by the FERC, reflect the rates for such services in our current FERC tariffs for the life of the related contracts; however, these rates may change based on future rate cases or settlements approved by the FERC. This table excludes the variable consideration component for commodity charges. Certain of our contracts contain evergreen and other renewal provisions for periods beyond the initial term of the contract. The remaining performance obligations as of ~~September~~March 3031, ~~2023~~2024 do not consider potential future performance obligations for which the renewal has not been exercised and exclude contracts with customers for which the underlying facilities have not received FERC authorization to be placed into service.

The following table presents the amount of the contract liabilities balance expected to be recognized as revenue when performance obligations are satisfied and the transaction price allocated to the remaining performance obligations under certain contracts as of ~~September~~March 3031, ~~2023~~2024.

	Contract Liabilities		Remaining Performance Obligations
	(Thousands)
2023 (three months)	$	296	$	101,092
2024 (nine months)	$	885	$	285,582
2024 (one year)	1,178		382,253
2025 (one year)	290		379,010
2025 (one year)	290		339,411
2026 (one year)	—		358,499
2026 (one year)	—		323,891
2027 (one year)	—		352,185
2027 (one year)	—		320,119
2028 (one year)	—		346,683
Thereafter	—		2,~~216~~251,~~067~~160
Total	$	1,~~764~~175	$	3,~~682~~973,~~833~~119

Accounts Receivable

Receivables from contracts with customers are included within Receivables - Trade and Receivables - Affiliates, and receivables that are not related to contracts with customers are included within the balance of Receivables - Advances to affiliate and Receivables - Other on our Balance Sheet.


Notes (Continued)			Table of Contents

Note 3 – Rate and Regulatory Matters

Rate Case Settlement

On November 15, 2022, the FERC approved our Petition for Approval of Pre-Filing Stipulation and Settlement Agreement (Settlement) in Docket No. RP22-1155. The Settlement establishes a new general system firm Rate Schedule TF-1 (Large Customer) daily reservation rate of $0.37250 ~~per dekatherm (~~/Dth) with a $0.00935/Dth commodity rate, (which were made effective January 1, 2023), ~~resolves~~resolved other rate issues, ~~establishes~~established a Modernization and Emission Reduction Program and satisfies our rate case filing obligation under our settlement in Docket No. RP17-346. Provisions were included in the Settlement that establish a moratorium on any Natural Gas Act of 1938, as amended (NGA) Section 4 or 5 proceedings that would seek to place new rates in effect any earlier than January 1, 2026. The Settlement also provides that we file an NGA Section 4 general rate case with rates to be effective not later than April 1, 2028, unless (a) we have entered into a pre-filing settlement or (b) a Section 5 general rate case has been filed on or before April 1, 2028.

As a result of the Settlement, in January 2023, we refunded approximately $126 million, including interest, associated with the decrease in federal tax rates due to the Tax Cuts and Jobs Act of 2017 (Tax Reform)~~, which was recorded in Accrued liabilities - Regulatory liabilities on our Balance Sheet~~.

Note 4 – Contingent Liabilities and Commitments

Environmental Matters

Beginning in the mid-1980s, we evaluated many of our facilities for the presence of toxic and hazardous substances to determine to what extent, if any, remediation might be necessary. We identified polychlorinated biphenyl (PCB) contamination in air compressor systems, soils, and related properties at certain compressor station sites. Similarly, we identified hydrocarbon impacts at these facilities due to the former use of earthen pits, lubricating oil leaks or spills, and excess pipe coating released to the environment. In addition, heavy metals have been identified at these sites due to the former use of mercury containing meters and paint and welding rods containing lead, cadmium, and arsenic. The PCBs were remediated pursuant to a Consent Decree with the U.S. Environmental Protection Agency (EPA) in the late 1980s, and we conducted a voluntary clean-up of the hydrocarbon and mercury impacts in the early 1990s. In 2005, the Washington Department of Ecology required us to re-evaluate our previous clean-ups in Washington. During 2006 to 2015, 129 meter stations were evaluated, of which 82 required remediation. As of ~~September~~March 3031, ~~2023~~2024, two meter stations are still being remediated. During 2006 to 2018, 14 compressor stations were evaluated, of which 11 required remediation. As of ~~September~~March 3031, ~~2023~~2024, four compressor stations are still being remediated. At ~~September~~March 3031, ~~2023~~2024, we had accrued liabilities totaling approximately $1.0 million, $0.12 million of which is recorded in Accrued liabilities - Other and $0.98 million of which is recorded in Other Long-Term Liabilities - Other on the Balance Sheet. At December 31, ~~2022~~2023, we had accrued liabilities totaling approximately $1.0 million, $0.12 million of which is recorded in Accrued liabilities - Other and $0.98 million of which is recorded in Other Long-Term Liabilities - Other on the Balance Sheet. We are conducting environmental assessments and implementing a variety of remedial measures that may result in increases or decreases in the total estimated costs.

The EPA and various state regulatory agencies routinely propose and promulgate new rules, and issue updated guidance to existing rules. These rulemakings include, but are not limited to, rules for reciprocating internal combustion engine and combustion turbine maximum achievable control technology, review and updates to the National Ambient Air Quality Standards, and rules for new and existing source performance standards for volatile organic compounds and methane. We continuously monitor these regulatory changes and how they may impact our operations. Implementation of new or modified regulations may result in impacts to our operations and increase the cost of additions to Total property, plant, and equipment, net on the Balance Sheet for both new and existing facilities in affected areas; however, due to regulatory uncertainty on final rule content and applicability timeframes, we are unable to reasonably estimate the cost of these regulatory impacts at this time.


Notes (Continued)			Table of Contents

Environmental expenditures are expensed or capitalized depending on their future economic benefit and potential for rate recovery. We believe that, with respect to any expenditures required to meet applicable standards and regulations, the FERC would grant the requisite rate relief so that substantially all of such expenditures would be permitted to be recovered through rates.

Washington State Climate Commitment Act

In 2021, the state of Washington passed its Climate Commitment Act establishing a market-based cap-and-invest program to reduce carbon emissions. This program took effect on January 1, 2023, and sets a limit, or cap, on overall carbon emissions in the state and requires businesses like ours to obtain allowances equal to their annual covered carbon emissions. The state’s cap will be reduced over time to meet the state’s carbon emissions reduction targets, which means fewer carbon emissions allowances will be available to purchase each year. These allowances can be purchased through quarterly auctions hosted by the state or bought and sold on a secondary market. In 2023, we began purchasing allowances for the carbon emissions from nine of our thirteen compressor stations within the state whose annual carbon emissions exceed 25,000 metric tons of carbon dioxide equivalent. We also began purchasing allowances for our delivery of natural gas to certain of our customers and certain of our facilities in the state whose annual carbon emissions are insufficient to require their direct participation in the program. Our Settlement allows us to recover the costs of purchasing allowances under the program in our next rate case.

WeAt ~~record~~March 31, ~~the~~2024 ~~purchased~~and ~~emission~~December 31, ~~allowances~~2023, ata ~~cost~~total ~~and~~of ~~the~~$23.7 million ~~associated~~and ~~accumulated~~$22.3 million, ~~interest~~respectively, towere aincluded ~~regulatory~~in ~~asset.~~Other ~~The~~Long-Term ~~difference~~Assets ~~between~~- ~~the~~Regulatory ~~allowances~~assets ~~held~~on ~~and~~our ~~the~~Balance ~~allowances~~Sheet ~~required~~and ~~based~~was oncomprised ~~actual~~of ~~emissions~~the ~~for~~cost of the ~~period~~purchased ~~are~~allowances ~~measured~~held, ~~using~~the anestimated ~~estimate~~difference ~~based~~between onthe ~~our~~allowances ~~most~~held ~~recent~~and ~~cost~~the of allowances required, and ~~accrued~~the tointerest aincome ~~current~~component ~~liability~~of ~~and~~the ~~to a~~ regulatory asset. At ~~September~~March 3031, 2024 and December 31, 2023, $31.7 million and $3.7 million, ~~was~~respectively, were included in Accrued liabilities - Other on our Balance Sheet as the estimated difference. AThe ~~total of $17.1 million was included in Other Assets - Regulatory assets on our Balance Sheet, and the~~ interest income ~~component of the regulatory asset~~ is reflected in Miscellaneous other (income) expense, net on our Statement of Net Income and was $0.24 million ~~and $0.3 million~~ for the three months ended March 31, 2024 and ~~nine~~minimal for the three months ended ~~September~~March 3031, 2023~~, respectively~~.

Other Matters

Various other proceedings are pending against us and are considered incidental to our operations.

Summary

We have disclosed all significant matters for which we are unable to reasonably estimate a range of possible loss. We estimate that for all matters for which we are able to reasonably estimate a range of loss, including those noted above and others that are not individually significant, our aggregate reasonably possible losses beyond amounts accrued for all of our contingent liabilities are immaterial to our expected future annual results of operations, liquidity and financial position. These calculations have been made without consideration of any potential recovery from third parties.


Notes (Continued)			Table of Contents

Note 5 – Debt and Financing Arrangements

Credit Facility

We, along with Williams and Transcontinental Gas Pipe Line Company, LLC (Transco), are party to a credit agreement with aggregate commitments available of $3.75 billion, with up to an additional $500 million increase in aggregate commitments available under certain circumstances. In the second quarter of 2023, the maturity date of our credit agreement was extended one year and now expires October 8, 2027. One participating lender, Credit Suisse AG, New York Branch, with a commitment of approximately $194 million did not extend their commitment beyond October 8, 2026. The amended credit agreement allows the co-borrowers to request up to two extensions of the maturity date each for an additional one-year period to allow a maturity date as late as October 8, 2029, under certain circumstances. Additionally, the amended credit agreement replaces the London Interbank Offered Rate with Term Secured Overnight Financing Rate as the benchmark interest rate index. We and Transco are each able to borrow up to $500 million under this credit facility to the extent not otherwise utilized by the other co-borrowers. At ~~September~~March 3031, ~~2023~~2024, no letters of credit have been issued and no loans were outstanding under the credit facility.

Commercial Paper Program

Williams ~~participates~~has in a $3.5 billion commercial paper program,. ~~and~~ Williams’ management considers amounts outstanding under this program to be a reduction of available capacity under the credit facility. At ~~September~~March 3031, ~~2023~~2024, Williams had no outstanding commercial paper.

Note 6 – Fair Value Measurements

Fair Value Methods

The following methods and assumptions were used to estimate the fair value of each class of financial instruments for which it is practicable to estimate that value:

Short-term financial assets: The carrying values of short-term financial assets that have variable interest rates (advances to affiliate), accounts receivable and accounts payable approximate fair value because of the short-term nature of these instruments.

Long-term debt: The disclosed fair value of our long-term debt, which we consider as a level 2 measurement, is determined by a market approach using broker quoted indicative period-end bond prices. The quoted prices are based on observable transactions in less active markets for our debt or similar instruments. The carrying amount and estimated fair value of our long-term debt, including current maturities, were $~~580~~581.95 million and $~~557~~571.46 million, respectively, at ~~September~~March 3031, ~~2023~~2024, and $~~580~~581.12 million and $~~560~~581.21 million, respectively, at December 31, ~~2022~~2023.

Note 7 – Transactions with Affiliates

We are a participant in Williams’ cash management program, and we make advances to and receive advances from Williams. At ~~September~~March 3031, ~~2023~~2024 and December 31, ~~2022~~2023, our advances to Williams totaled approximately $~~164~~169.31 million and $~~310~~157.68 million, respectively. These advances are represented by demand notes and are classified as Receivables - Advances to affiliate on the Balance Sheet. The interest rate on these intercompany demand notes is based upon the daily overnight investment rate paid on Williams’ excess cash at the end of each month, which was approximately 5.2 percent at ~~September~~March 3031, ~~2023~~2024. The interest income from these advances was $2.1.9 million and $62.4 million for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2023,~~2024 ~~respectively,~~ and ~~$1.8 million and $2.3 million for the three and nine months ended September 30~~2023, ~~2022~~respectively. Such interest income is included in Other (Income) and Other Expenses – Miscellaneous other (income) expense, net on the Statement of Net Income.

We have no employees. Services necessary to operate our business are provided to us by Williams and certain affiliates of Williams. We reimburse Williams and its affiliates for all direct and indirect expenses incurred or payments made (including salary, bonus, incentive compensation and benefits) in connection with these services. Employees of Williams also provide general, administrative and management services to us, and we are charged for certain administrative expenses incurred by Williams. These charges are either directly identifiable or allocated to our assets. Direct charges are for goods and services provided by Williams at our request. Allocated charges are based on a three-factor formula, which considers revenues; property, plant, and equipment; and payroll. In management’s estimation, the allocation methodologies used are reasonable and result in a reasonable allocation to us of our costs of doing business incurred by Williams. We have recorded $22.3 million and $22.1 million for the


Notes (Continued)			Table of Contents

Employees of Williams also provide general, administrative and management services to us, and we are charged for certain administrative expenses incurred by Williams. These charges are either directly identifiable or allocated to our assets. Direct charges are for goods and services provided by Williams at our request. Allocated charges are based on a three~~-factor~~ formula, which considers revenues; property, plant, and equipment; and payroll. In management’s estimation, the allocation methodologies used are reasonable and result in a reasonable allocation to us of our costs of doing business incurred by Williams. We have recorded $20.4 million and $63.4 million for the three and nine months ended ~~September~~March 3031, ~~2023,~~2024 ~~respectively~~ and ~~$22.9 million and $65.1 million for the three and nine months ended September 30~~2023, ~~2022,~~ respectively, for these service expenses, which are primarily included in Operation and maintenance and General and administrative expenses on the Statement of Net Income.

During ~~October~~April ~~2023~~2024, we declared and paid a cash distribution of $2042.5 million to our parent.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

General

The following discussion and analysis should be read in conjunction with our historical Financial Statements and accompanying notes and Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in our ~~2022~~2023 Annual Report on Form 10-K and with the Financial Statements and accompanying notes contained in this Form 10-Q.

Results of Operations

This analysis discusses financial results of our operations for the ~~nine~~three-month periods ended ~~September~~March 3031, ~~2023~~2024 and ~~2022~~2023. Variances due to changes in natural gas prices and transportation volumes have little impact on revenues, because under our rate design methodology, the majority of overall cost of service is recovered through firm capacity reservation charges in our transportation rates.

Net Income for the first ~~nine~~three months of ~~2023~~2024 of $~~135~~53.1 million increased by $404.1 million, or 428 percent when compared to the $9549.0 million recognized during the first ~~nine~~three months of ~~2022~~2023 due to the following significant variances:

Operating Revenues ~~decreased~~increased $34.84 million, or 14 percent, primarily driven by:

•$103.68 million ~~decrease~~increase in Natural gas transportation revenues primarily due to ~~new~~an ~~rates~~increase ~~that~~in ~~became~~short-term ~~effective~~firm ~~January~~transportation 1,from ~~2023 as a result of~~ the ~~approval~~sale of ~~our~~new ~~Settlement~~capacity ~~(also~~that ~~see Note 3 – Rate and Regulatory Matters), which~~ was ~~partially~~not ~~offset~~available byin ~~higher~~the ~~short-term~~prior ~~firm transportation~~year;

•$40.94 million increase in Other revenues from higher park and loan services; and

•$2.0.2 million increase in Natural gas storage revenues primarily due to ancapacity ~~increase in storage rates effective January 1, 2023 as a result of our Settlement~~release.

Operating Expenses ~~decreased~~increased $381.25 million, or 173 percent, primarily due to ~~the items below, which were also associated with the approval of our Settlement~~:

•$172.6 million ~~decrease~~increase in ~~Regulatory~~Operation ~~charges~~and ~~resulting~~Maintenance ~~from~~costs ~~tax rate changes~~ due to ~~the~~higher ~~absence~~labor ofcosts, ~~the~~higher ~~accrual~~contract ~~for~~services ~~refund~~ related to ~~the~~pipeline ~~regulatory~~inspection ~~liability associated with Tax Reform that ended in 2022~~ and ~~was~~higher ~~refunded~~storage tofacility ~~customers~~expenses, inpartially ~~January~~offset ~~2023; and~~by

•$141.2 million ~~favorable~~decrease ~~change~~ in ~~Other~~General ~~(income)~~and ~~expense,~~administrative ~~net~~expenses ~~primarily~~due ~~related~~ to ~~the amortization of our regulatory liabilities associated with deferred taxes that were established as~~ a ~~result~~favorable ofchange ~~decreases~~ in ~~the~~allocated ~~estimated~~corporate ~~effective~~expenses ~~federal~~ and ~~state~~lower ~~income~~insurance ~~tax rates~~premiums.

Other (Income) and Other Expenses had a $51.72 million favorable change primarily due to an increase in the allowance for funds used during construction as a result of increased capital expenditures and the absence of interest ~~income~~expense on ~~our~~the ~~advances~~regulatory toliability ~~Williams~~associated with the decrease in federal tax rates due to ~~rising~~Tax ~~interest~~Reform ~~rates~~that was refunded to customers in January 2023 as a result of the approval of our Settlement (also see Note 3 – Rate and Regulatory Matters).

Pipeline Expansion Projects

Ryckman Creek Loop

The Ryckman Creek Loop expansion involves an expansion of our existing natural gas transmission system to provide incremental firm transportation capacity from a receipt point in Northeast Oregon (Stanfield) to multiple delivery points in Southwest Wyoming. We plan to place the project in service as early as the fourth quarter of 2025 assuming timely receipt of all necessary regulatory approvals. The project is expected to increase capacity by 50.5 MDth/d.

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Item 4. Controls and Procedures

Disclosure Controls and Procedures

Our management, including our Senior Vice President and our Vice President and Chief Accounting Officer, does not expect that our disclosure controls and procedures (as defined in Rules 13a - 15(e) and 15d - 15(e) of the Securities Exchange Act, as amended) (Disclosure Controls) or our internal control over financial reporting (Internal Controls) will prevent all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the control. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected. We monitor our Disclosure Controls and Internal Controls and make modifications as necessary; our intent in this regard is that the Disclosure Controls and Internal Controls will be modified as systems change and conditions warrant.

Evaluation of Disclosure Controls and Procedures

An evaluation of the effectiveness of the design and operation of our Disclosure Controls was performed as of the end of the period covered by this report. This evaluation was performed under the supervision and with the participation of our management, including our Senior Vice President and our Vice President and Chief Accounting Officer. Based upon that evaluation, our Senior Vice President and our Vice President and Chief Accounting Officer concluded that these Disclosure Controls are effective at a reasonable assurance level.

Changes in Internal Control over Financial Reporting

There have been no changes during the ~~third~~first quarter of ~~2023~~2024 that have materially affected, or are reasonably likely to materially affect, our Internal Control over Financial Reporting.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

Environmental

While it is not possible for us to predict the final outcome of any pending legal proceedings involving governmental authorities under federal, state, and local laws regulating the discharge of materials into the environment, we do not anticipate a material effect on our financial position if we were to receive an unfavorable outcome in any one or more of such proceedings. Our threshold for disclosing material environmental legal proceedings involving a governmental authority where potential monetary sanctions are involved is $1 million.

Other

The additional information called for by this item is provided in Note 4 – Contingent Liabilities and Commitments, included in the Notes to Financial Statements included under Part I, Item 1. Financial Statements of this Form 10-Q, which information is incorporated by reference into this item.

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Item 1A. Risk Factors

Part I, Item 1A. Risk Factors in our Annual Report on Form 10-K for the year ended December 31, ~~2022~~2023, includes certain risk factors that could materially affect our business, financial condition, or future results. Those Risk Factors have not materially changed.

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Item 6. Exhibits

The following instruments are included as exhibits to this report.


Exhibit						Description

2						Certificate of Conversion of Northwest Pipeline GP (filed July 3, 2013 as Exhibit 2.1 to our current report on Form 8-K (File No. 001-07414) and incorporated herein by reference).

3.1						Certificate of Formation of Northwest Pipeline LLC (filed July 3, 2013 as Exhibit 2.2 to our current report on Form 8-K (File No. 001-07414) and incorporated herein by reference).

3.2						Operating Agreement of Northwest Pipeline LLC (filed July 3, 2013 as Exhibit 3.1 to our current report on Form 8-K (File No. 001-07414) and incorporated herein by reference).

31.1*						Certification of Principal Executive Officer pursuant to Rules 13a-14(a) and 15d-14(a) promulgated under the Securities Exchange Act of 1934, as amended and Item 601(b)(31) of Regulation S-K, as adopted pursuant to Section 302 of The Sarbanes-Oxley Act of 2002.

31.2*						Certification of Principal Financial Officer pursuant to Rules 13a-14(a) and 15d-14(a) promulgated under the Securities Exchange Act of 1934, as amended, and Item 601(b)(31) of Regulation S-K, as adopted pursuant to Section 302 of The Sarbanes-Oxley Act of 2002.

32**						Certification of Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

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*			Filed herewith.
**			Furnished herewith.

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SIGNATURE

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

NORTHWEST PIPELINE LLC(Registrant)

Date:

~~November~~May 16, ~~2023~~2024

By:

/s/ Billeigh W. Mark

Billeigh W. Mark

Controller

(Principal Accounting Officer)

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