FORM 10-Q

                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549


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

                  For the quarterly period ended June 30, 1999

                                       OR

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

                For the transition period from _______ to _______


Commission file number: 1-14323

                        Enterprise Products Partners L.P.
             (Exact name of Registrant as specified in its charter)

               Delaware                                           76-0568219
(State or other jurisdiction of                               (I.R.S. Employer
incorporation or organization)                               Identification No.)

                              2727 North Loop West
                                 Houston, Texas
                                   77008-1037
               (Address of principal executive offices) (Zip code)

                                 (713) 880-6500
               (Registrant's telephone number including area code)

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

     The  registrant had  45,552,915  Common Units  outstanding as of August 9,
1999.


<PAGE>
               Enterprise Products Partners L.P. and Subsidiaries

                                TABLE OF CONTENTS
<TABLE>
<CAPTION>
                                                                                          Page
                                                                                           No.
<S>                                                                                       <C>
Part I.  Financial Information

Item 1.  Financial Statements

Enterprise Products Partners L.P. Unaudited Consolidated Financial Statements:

         Consolidated Balance Sheets,  June 30, 1999 and December 31, 1998                1

         Statements of Consolidated Operations
                  for the Three and Six Months ended June 30, 1999 and 1998               2

         Statements of Consolidated Cash Flows
                  for the Three and Six Months ended June 30, 1999 and 1998               3

         Notes to Unaudited Consolidated Financial Statements                             4-8

Item 2.  Management's Discussion and Analysis of Financial Condition and
         Results of Operations                                                            9-20

Item 3.  Quantitative and Qualitative Disclosures about Market Risk                      21

Part II. Other Information

Item 6.  Exhibits and Reports on Form 8-K                                                22-24

         Signature Page                                                                   25

</TABLE>
<PAGE>
                         PART 1. FINANCIAL INFORMATION.
                          Item 1. FINANCIAL STATEMENTS.

                        Enterprise Products Partners L.P.
                           Consolidated Balance Sheets
                             (Amounts in thousands)
<TABLE>
<CAPTION>
                                                                                                                    June 30,
                                                                                               December 31,           1999
                                           ASSETS                                                  1998           (Unaudited)
                                                                                             -------------------------------------
<S>                                                                                              <C>                <C>
Current Assets
       Cash and cash equivalents                                                                 $ 24,103           $  3,959
       Accounts receivable - trade                                                                 57,288             57,644
       Accounts receivable - affiliates                                                            15,546             21,764
       Inventories                                                                                 17,574             55,526
       Current maturities of participation in notes receivable from
           unconsolidated affiliates                                                               14,737             14,737
        Prepaid and other current assets                                                            8,445              7,475
                                                                                             -------------------------------------
                        Total current assets                                                      137,693            161,105
Property, Plant and Equipment, Net                                                                499,793            492,788
Investments in and Advances to Unconsolidated Affiliates                                           91,121            132,005
Participation in Notes Receivable from Unconsolidated Affiliates                                   11,760              4,391
Other Assets                                                                                          670                236
                                                                                             =====================================
                        Total                                                                    $741,037           $790,525
                                                                                             =====================================

                              LIABILITIES AND PARTNERS' EQUITY

Current Liabilities
       Accounts payable - trade                                                                  $ 36,586           $ 36,422
       Accrued gas payables                                                                        27,183             50,047
       Accrued expenses                                                                             7,540              5,591
       Other current liabilities                                                                   11,462              7,819
                                                                                             -------------------------------------
                        Total current liabilities                                                  82,771             99,879
Long-Term Debt                                                                                     90,000            145,000
Minority Interest                                                                                   5,730              5,548
Commitments and Contingencies
Partners' Equity
       Common Units                                                                               433,082            410,958
       Subordinated Units                                                                         123,829            123,693
       General Partner                                                                              5,625              5,447
                                                                                             -------------------------------------
                        Total Partners' Equity                                                    562,536            540,098
                                                                                             =====================================
                        Total                                                                    $741,037           $790,525
                                                                                             =====================================
</TABLE>
            See Notes to Unaudited Consolidated Financial Statements
                                       1
<PAGE>
                    PART 1. FINANCIAL INFORMATION (continued)
                    Item 1. FINANCIAL STATEMENTS (continued)

                        Enterprise Products Partners L.P.
                      Statement of Consolidated Operations
                                   (Unaudited)
                 (Amounts in thousands, except per Unit amounts)
<TABLE>
<CAPTION>
                                                                  Three Months Ended                    Six Months Ended
                                                                       June 30,                             June 30,
                                                               1998               1999              1998               1999
                                                         --------------------------------------------------------------------------
<S>                                                            <C>                <C>               <C>                <C>
REVENUES                                                       $207,566           $174,599          $398,083           $321,913
COST AND EXPENSES
Operating costs and expenses                                    186,784            153,283           368,231            287,095
Selling, general and administrative                               5,857              3,000            11,611              6,000
                                                         --------------------------------------------------------------------------
         Total                                                  192,641            156,283           379,842            293,095
                                                         --------------------------------------------------------------------------
OPERATING INCOME                                                 14,925             18,316            18,241             28,818
                                                         --------------------------------------------------------------------------
OTHER INCOME (EXPENSE)
Interest expense                                                 (4,070)            (1,913)          (10,804)            (3,959)
Equity income in unconsolidated affiliates                        3,831              2,880             6,653              4,443
Interest income from unconsolidated affiliates                        -                292                 -                689
Interest income - other                                             285                148               560                432
Other, net                                                          428               (373)              430               (512)
                                                         --------------------------------------------------------------------------
          Other income  (expense)                                   474              1,034            (3,161)             1,093
                                                         --------------------------------------------------------------------------
INCOME BEFORE MINORITY INTEREST                                  15,399             19,350            15,080             29,911
MINORITY INTEREST                                                  (154)              (196)             (151)              (302)
                                                         ==========================================================================
NET INCOME                                                   $   15,245         $   19,154        $   14,929         $   29,609
                                                         ==========================================================================
ALLOCATION OF NET INCOME TO:
          Limited partners                                   $   15,093         $   18,962        $   14,780         $   29,313
          General partner                                    $      152         $      192        $      149         $      296
                                                         ==========================================================================
NET INCOME PER UNIT                                          $     0.27         $     0.28        $     0.27         $     0.44
                                                         ==========================================================================
WEIGHTED-AVERAGE NUMBER OF UNITS
          OUTSTANDING                                            54,963             66,696            54,963             66,725
                                                         ==========================================================================
</TABLE>
            See Notes to Unaudited Consolidated Financial Statements
                                       2
<PAGE>
                    PART 1. FINANCIAL INFORMATION (continued)
                    Item 1. FINANCIAL STATEMENTS (continued)

                        Enterprise Products Partners L.P.
                      Statements of Consolidated Cash Flows
                                   (Unaudited)
                             (Dollars in Thousands)
<TABLE>
<CAPTION>

                                                                               Six Months Ended
                                                                                   June 30,
                                                                             1998           1999
                                                                         -----------------------------
<S>                                                                          <C>            <C>
OPERATING ACTIVITIES
Net income                                                                   $14,929        $29,609
Adjustments to reconcile net income to cash flows provided by
      (used for) operating activities:
      Depreciation and amortization                                            9,403          9,790
      Equity in income of unconsolidated affiliates                           (6,653)        (4,443)
      Leases paid by EPCO                                                          -          5,278
      Minority interest                                                          151            302
      (Gain) loss on sale of assets                                             (252)           124
      Net effect of changes in operating accounts                            (36,667)       (26,417)
                                                                         -----------------------------
Operating activities cash flows                                              (19,089)        14,243
                                                                         -----------------------------
INVESTING ACTIVITIES
Capital expenditures                                                          (7,388)        (2,513)
Proceeds from sale of assets                                                   3,704              7
Collection of notes receivable from unconsolidated affiliates                      -          7,369
Unconsolidated affiliates:
      Investments in and advances to                                         (14,471)       (40,432)
      Distributions received                                                   4,891          3,991
                                                                         -----------------------------
Investing activities cash flows                                              (13,264)       (31,578)
                                                                         -----------------------------
FINANCING ACTIVITIES
Long-term debt borrowings                                                          -         85,000
Long-term debt repayments                                                    (12,174)       (30,000)
Net decrease in restricted cash                                               (1,212)             -
Cash dividends paid to partners                                                    -        (52,718)
Cash dividends paid to minority interest                                           -           (538)
Units acquired by consolidated trusts                                              -         (4,607)
Cash contributions from EPCO to minority interest                                  -             54
                                                                         -----------------------------
Financing activities cash flows                                              (13,386)        (2,809)
                                                                         -----------------------------
CASH CONTRIBUTIONS FROM (TO) EPCO                                             35,974              -
NET CHANGE IN CASH AND CASH EQUIVALENTS                                       (9,765)       (20,144)
CASH AND CASH EQUIVALENTS, JANUARY 1                                          18,941         24,103
                                                                          =============================
CASH AND CASH EQUIVALENTS , JUNE 30                                         $  9,176       $  3,959
                                                                         =============================
</TABLE>
            See Notes to Unaudited Consolidated Financial Statements
                                       3
<PAGE>
                        Enterprise Products Partners L.P.
                   Notes to Consolidated Financial Statements
                                   (Unaudited)



1.   GENERAL

In the  opinion of  Enterprise  Products  Partners  L.P.  (the  "Company"),  the
accompanying unaudited consolidated financial statements include all adjustments
consisting of normal recurring accruals necessary for a fair presentation of the
Company's   consolidated  financial  position  as  of  June  30,  1999  and  its
consolidated  results of  operations  and cash flows for the three and six month
periods  ended  June 30,  1999 and  1998.  Although  the  Company  believes  the
disclosures in these  financial  statements are adequate to make the information
presented not misleading,  certain information and footnote disclosures normally
included in annual  financial  statements  prepared in accordance with generally
accepted  accounting  principles have been condensed or omitted  pursuant to the
rules and regulations of the Securities and Exchange Commission. These unaudited
financial statements should be read in conjunction with the financial statements
and notes thereto  included in the Company's  Annual Report on Form 10-K for the
year ended December 31, 1998 ("Form 10-K").

The results of  operations  for the three and six months ended June 30, 1999 are
not necessarily indicative of the results to be expected for the full year.

Dollar amounts presented in the tabulations within the notes to the consolidated
financial  statements  are stated in  thousands  of  dollars,  unless  otherwise
indicated.

2.   INVESTMENTS IN AND ADVANCES TO UNCONSOLIDATED AFFILIATES

At June 30, 1999, the Company's significant  unconsolidated affiliates accounted
for by the equity method included the following:

     Belvieu  Environmental  Fuels  ("BEF") - a 33-1/3%  economic  interest in a
     Methyl Tertiary Butyl Ether ("MTBE") production facility.

     Mont  Belvieu  Associates  ("MBA") - a 49%  economic  interest in an entity
     which owns a 50% interest in a NGL fractionation  facility.  See Note 7 for
     subsequent event.

     Entell NGL  Services,  LLC  ("Entell") - a 50%  economic  interest in a NGL
     transportation  and distribution  system located in Louisiana and southeast
     Texas.

     Baton Rouge  Fractionators LLC ("BRF") - a 27.5% economic interest in a NGL
     fractionation  facility which is scheduled to begin  production  during the
     third quarter of 1999.

     EPIK Terminalling L.P. and EPIK Gas Liquids, LLC (collectively, "EPIK") - a
     50%  aggregate  economic  interest in a  refrigerated  NGL marine  terminal
     loading facility which is under  construction and scheduled to become fully
     operational in the fourth quarter of 1999.

     Wilprise Pipeline  Company,  LLC ("Wilprise") - a 33-1/3% economic interest
     in a NGL pipeline  system that is scheduled to become fully  operational in
     the third  quarter of 1999 in  conjunction  with the startup of the BRF NGL
     fractionation facility.

The Company's  investments  in and advances to  unconsolidated  affiliates  also
includes Tri-States NGL Pipeline, LLC ("Tri-States").  The Tri-States investment
consists of a 16-2/3%  economic  interest in a NGL pipeline  system which became
operational on March 26, 1999.  This  investment is accounted for using the cost
method in accordance with generally accepted accounting principles.
                                       4
<PAGE>
Other joint ventures  included  various  entities in the formation stage at June
30, 1999.

Investments in and advances to unconsolidated affiliates at:
<TABLE>
<CAPTION>
                                                     December 31,      June 30,
                                                          1998            1999
                                                    ---------------------------------
<S>                                                   <C>               <C>
BEF................................................   $  50,079         $  51,712
MBA................................................      12,551            14,373
BRF................................................      17,896            28,148
EPIK...............................................       5,667            11,773
Wilprise...........................................       4,873             7,540
Entell.............................................           -               773
Tri-States.........................................          55            14,794
Other..............................................           -             2,892
                                                    =================================
Total..............................................   $  91,121         $ 132,005
                                                    =================================
</TABLE>
Equity in income of unconsolidated affiliates for the:
<TABLE>
<CAPTION>
                                        Three Months ended                Six Months ended
                                             June 30,                         June 30,
                                      1998             1999            1998             1999
                                 ------------------------------------------------------------------
<S>                                   <C>              <C>             <C>              <C>
BEF............................       $2,381           $1,936          $3,254           $2,237
MBA............................        1,494              424           3,443            1,184
BRF............................            -             (143)              -             (286)
EPIK...........................          (44)            (220)            (44)             177
Entell.........................            -              883               -            1,131
                                 ==================================================================
Total..........................       $3,831           $2,880          $6,653           $4,443
                                 ==================================================================
</TABLE>

3.   SUPPLEMENTAL CASH FLOW DISCLOSURE

The net effect of changes in operating assets and liabilities is as follows:
<TABLE>
<CAPTION>
                                                                 Six Months Ended
                                                                     June 30,
                                                               1998            1999
                                                         ---------------------------------
<S>                                                            <C>             <C>
(Increase) decrease in:
      Accounts receivable...............................      $ 4,805          $ (6,574)
      Inventories.......................................      (19,015)          (37,952)
      Prepaid and other current assets..................          425               970
      Other assets......................................         (906)                -
Increase (decrease) in:
      Accounts payable - trade..........................      (34,203)             (164)
      Accrued gas payable...............................       23,699            22,864
      Accrued expenses..................................       (4,849)           (1,949)
      Other current liabilities.........................       (6,623)           (3,612)
                                                         =================================
Net effect of changes in operating accounts                 $ (36,667)         $(26,417)
                                                         =================================
</TABLE>
                                       5
<PAGE>

4.   RECENTLY ISSUED ACCOUNTING STANDARDS

On June 6, 1999,  the  Financial  Accounting  Standards  Board  ("FASB")  issued
Statement of Financial  Accounting  Standard  ("SFAS) No. 137,  "Accounting  for
Derivative Instruments and Hedging  Activities-Deferral of the Effective Date of
FASB Statement No. 133-an amendment of FASB Statement No. 133" which effectively
delays and amends the  application  of SFAS No. 133  "Accounting  for Derivative
Instruments  and Hedging  Activities"  for one year,  to fiscal years  beginning
after June 15, 2000. Management is currently studying both SFAS No. 137 and SFAS
No. 133 for possible impact on the consolidated financial statements.

On April 3, 1998, the American  Institute of Certified Public Accountants issued
Statement  of  Position  ("SOP")  98-5, "Reporting  on the  Costs  of  Start-Up
Activities."  For years  beginning  after  December 15, 1998, SOP 98-5 generally
requires that all start-up costs of a business activity be charged to expense as
incurred and any start-up costs  previously  deferred should be written off as a
cumulative  effect of a change in  accounting  principle.  Adoption  of SOP 98-5
during  1999  did not  have a  material  impact  on the  consolidated  financial
statements  except for a $4.5 million noncash write-off that occurred on January
1, 1999 of the unamortized  balance of deferred  start-up costs of BEF, in which
the  Company  owns a 33-1/3%  interest.  This  write-off  caused a $1.5  million
reduction in the equity in income of  unconsolidated  affiliates  for 1999 and a
corresponding   reduction  in  the  Company's   investment   in   unconsolidated
affiliates.

5.   CAPITAL STRUCTURE

At June 30, 1999, the Company had 33,552,915  Common Units  outstanding  held by
Enterprise  Products  Company  (the  Company's  ultimate  parent or "EPCO")  and
12,000,000  Common Units  outstanding  held by third  parties.  During the first
quarter of 1999, the Company established a revocable grantor trust (the "Trust")
to  fund  future  liabilities  of  a  Long-Term  Incentive  Plan  (the  "Plan").
Provisions  of the Plan were not  finalized  as of August 9,  1999.  At June 30,
1999,  the Trust had  purchased  a total of 267,200  Common  Units  (the  "Trust
Units") which are accounted for in a manner  similar to treasury stock under the
cost method of accounting.  The Trust Units are considered  outstanding and will
receive  distributions;  however,  they are excluded from the calculation of net
income per Unit in accordance with generally accepted accounting principles.

6.  DISTRIBUTIONS

On January 12, 1999, the Company  declared a quarterly  distribution of $.45 per
Unit for the fourth quarter of 1998,  which was paid on February 11, 1999 to all
Unitholders of record on January 29, 1999. The Company declared its distribution
for the first quarter of 1999 on April 16, 1999 in the amount of $.45 per Common
Unit.  The first  quarter 1999  distribution  was paid on May 12, 1999 to Common
Unitholders of record on April 30, 1999. The Company  declared a $.45 per Common
Unit  distribution  for the second  quarter of 1999 on July 16, 1999. The second
quarter 1999 distribution will be paid on August 11, 1999 to Common  Unitholders
of record on July 30, 1999.

7.   SUBSEQUENT EVENTS

Acquisition of Tejas Assets

On April 20, 1999, the Company and Tejas Energy, LLC ("Tejas"),  an affiliate of
Shell Oil Company ("Shell"), announced that they had agreed to general terms for
a business  combination  encompassing  the Company and a substantial  portion of
Tejas' natural gas liquids ("NGL")  business.  The agreed upon terms contemplate
Tejas  contributing  certain  NGL assets to the  Company  for which  Tejas would
receive  an  equity  interest  in  the  Company  and  other  consideration.  The
completion of this transaction  would form a business  combination  comprising a
fully  integrated  Gulf  Coast  NGL  processing,   fractionation,  storage,  and
transportation business. It would also establish an alliance between the Company
and Shell whereby the Company would have the rights to process  Shell's  current
and future Gulf of Mexico natural gas production and market the NGLs  recovered.
Any  transaction  resulting  from the agreed  upon terms would be subject to the
Company and Tejas successfully executing a definitive agreement;  satisfactorily
completing  their  respective  due  diligence   reviews;   receiving   requisite
regulatory  approvals  and  receiving  approvals  from each  company's  board of
directors.  The parties  anticipate  the closing of this  transaction  in August
1999.

                                       6
<PAGE>

Purchase of Lou-Tex Pipeline

On July 27, 1999,  the Company  announced the execution of a letter of intent to
acquire a  Louisiana  and Texas  pipeline  asset from Concha  Chemical  Pipeline
Company ("Concha"), an affiliate of Shell Oil Company, for an undisclosed amount
of cash. The pipeline being acquired,  referred to as the Lou-Tex  pipeline,  is
263 miles of 10" pipeline from Sorrento,  Louisiana to Mont Belvieu,  Texas. The
Lou-Tex pipeline is currently  dedicated to the transportation of chemical grade
propylene from Sorrento to the Mont Belvieu area.  Enterprise plans to convert a
portion of the  Lou-Tex  pipeline  into batch  service.  In batch  service,  the
pipeline will be able to transport refinery and chemical grade propylene,  mixed
NGLs and NGL products:  ethane,  propane,  normal butane,  isobutane and natural
gasoline.  In  conjunction  with the  plans to  convert  the  pipeline  to batch
service, the capacity of the Lou-Tex pipeline will be increased to approximately
75,000  barrels  per  day.  The  acquisition  of the  Lou-Tex  pipeline  and its
conversion into batch service is the first step in the Company's  development of
a $245 million,  160,000 barrel per day gas liquids pipeline system. This larger
system will link growing  supplies of NGLs produced in Louisiana and Mississippi
with the principal NGL markets on the United States Gulf Coast.  The  completion
of  the  Lou-Tex  transaction  is  subject  to  the  successful  negotiation  of
definitive   agreements,   approval  of  those   agreements  by  the  respective
managements  and  regulatory  approvals.  This  transaction  is  expected  to be
completed  by the end of the third  quarter of 1999.  Conversion  of the Lou-Tex
system to batch  service with 75,000  barrels per day of capacity is expected in
the second half of 2000.

The Company  will  acquire the Lou-Tex  pipeline  asset  through its  affiliate,
Entell NGL Services,  LLC ("Entell").  Entell,  formed in early 1999, is a 50/50
joint  venture  between  the  Company and Tejas  Natural  Gas  Liquids,  LLC, an
affiliate of Shell Oil Company.  Upon completion of the previously announced NGL
alliance  between  Shell  Oil  Company  and  the  Company,   Entell  will  be  a
wholly-owned subsidiary of the Company.

Acquisition of Kinder Morgan interest in Fractionation facility

On July 28, 1999, the Company  announced that it had agreed to general terms and
conditions for the Company to purchase  Kinder Morgan Energy Partners L.P.'s 25%
indirect  ownership  interest  in a  210,000  barrel  per day NGL  fractionating
facility   located  in  Mont  Belvieu,   Texas  for  $41  million  in  cash  and
approximately  $4  million  in  debt   assumption.   In  conjunction  with  this
transaction,  the  Company  will  acquire  EPCO's  1%  interest  in  MBA  for an
undisclosed amount of cash. Upon completion of these transactions, the Company's
ownership interest in the Mont Belvieu fractionation facility will increase from
37.0% to 62.5%.  This  fractionator  is located in the  Company's  Mont  Belvieu
processing  complex.  The Company  serves as the operator of the  facility.  The
parties anticipate closing this transaction in August 1999.

New Bank Credit facility

Also on July 28,  1999,  Enterprise  Products  Operating  L.P.  (the  "Operating
Partnership") entered into a $350.0 million bank credit facility that includes a
$50.0 million working capital facility and a $300.0 million  revolving term loan
facility. The $300.0 million revolving term loan facility includes a sublimit of
$10.0  million  for  letters of credit.  The  proceeds of this loan will be used
principally for the acquisition of the Tejas assets,  the Lou-Tex pipeline,  and
Kinder Morgan's interest in the fractionation facility.

Borrowings  under the bank  credit  facility  will bear  interest  at either the
bank's prime rate or the Eurodollar  rate plus the applicable  margin as defined
in the  facility.  The bank credit  facility will expire after two years and all
amounts borrowed thereunder shall be due and payable on such date. There must be
no  amount  outstanding  under  the  working  capital  facility  for at least 15
consecutive days during each fiscal year.

The credit  agreement  relating to the new facility  contains a  prohibition  on
distributions  on, or purchases or  redemptions of Units if any event of default
is  continuing.   In  addition,   the  bank  credit  facility  contains  various
affirmative and negative covenants  applicable to the ability of the Company to,
among  other  things,  (i) incur  certain  additional  indebtedness,  (ii) grant
certain  liens,  (iii) sell assets in excess of certain  limitations,  (iv) make
investments,  (v) engage in  transactions  with affiliates and (vi) enter into a
merger, consolidation, or sale of assets. The bank credit facility requires that
the Operating  Partnership  satisfy the following financial covenants at the end
of each fiscal quarter: (i) maintain Consolidated Tangible Net Worth (as defined
in the bank credit facility) of at least $250,000,000,  (ii) maintain a ratio of
EBITDA (as defined in the bank credit facility) to Consolidated Interest Expense
(as defined in the bank credit facility) for the previous  12-month period of at
least 3.5 to 1.0 and (iii) maintain a ratio of Total Indebtedness (as defined in
the bank credit facility) to EBITDA of no more than 3.0 to 1.0.

                                       7
<PAGE>

A "Change of  Control"  constitutes  an Event of Default  under the bank  credit
facility.  A Change of Control includes any of the following events:  (i) Dan L.
Duncan  (and  certain  affiliates)  cease  to own (a) at  least  51% (on a fully
converted, fully diluted basis) of the economic interest in the capital stock of
EPCO or (b) an aggregate number of shares of capital stock of EPCO sufficient to
elect a majority  of the board of  directors  of EPCO;  (ii) EPCO ceases to own,
through a wholly owned  subsidiary,  at least 65% of the outstanding  membership
interest  in the  General  Partner  and at least a majority  of the  outstanding
Common Units;  (iii) any person or group  beneficially owns more than 20% of the
outstanding  Common  Units;  (iv) the General  Partner  ceases to be the general
partner of the Company or the Operating  Partnership;  or (v) the Company ceases
to be the sole limited partner of the Operating Partnership.








                                       8
<PAGE>
       Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                           AND RESULTS OF OPERATIONS.

              For the Interim Periods ended June 30, 1999 and 1998

     The following  discussion and analysis  should be read in conjunction  with
the unaudited  consolidated financial statements and notes thereto of Enterprise
Products  Partners  L.P.  ("Enterprise"  or the  "Company")  included  elsewhere
herein.

The Company

     The Company is a leading  integrated North American  provider of processing
and  transportation  services to domestic  and foreign  producers of natural gas
liquids  ("NGLs")  and  other  liquid  hydrocarbons  and  domestic  and  foreign
consumers of NGLs and liquid hydrocarbon  products.  The Company manages a fully
integrated and diversified  portfolio of midstream  energy assets and is engaged
in NGL processing and  transportation  through direct and indirect ownership and
operation  of NGL  fractionators.  It also  manages NGL  processing  facilities,
storage facilities,  pipelines, and rail transportation  facilities,  and methyl
tertiary  butyl ether  ("MTBE")  and  propylene  production  and  transportation
facilities in which it has a direct and indirect ownership.

     The Company is a publicly traded master limited  partnership (NYSE,  symbol
"EPD")  that  conducts  substantially  all of its  business  through  Enterprise
Products   Operating   L.P.  (the   "Operating   Partnership"),   the  Operating
Partnership's  subsidiaries,  and a  number  of  joint  ventures  with  industry
partners.  The Company was formed in April 1998 to acquire, own, and operate all
of the NGL processing and  distribution  assets of Enterprise  Products  Company
("EPCO").

     The principal executive office of the Company is located at 2727 North Loop
West,  Houston,  Texas,  77008-1038,  and the telephone number of that office is
713-880-6500.  References to, or  descriptions  of, assets and operations of the
Company in this  quarterly  report  include  the assets  and  operations  of the
Operating  Partnership and its  subsidiaries as well as the  predecessors of the
Company.

General

     The Company (i)  fractionates  for a processing  fee mixed NGLs produced as
by-products of oil and natural gas  production  into their  component  products:
ethane,  propane,  isobutane,  normal butane and natural gasoline; (ii) converts
normal butane to isobutane through the process of isomerization;  (iii) produces
MTBE from isobutane and methanol;  and (iv) transports NGL products to end users
by pipeline and railcar.  The Company also separates high purity  propylene from
refinery-sourced  propane/propylene  mix and transports high purity propylene to
plastics manufacturers by pipeline.  Products processed by the Company generally
are used as  feedstocks in  petrochemical  manufacturing,  in the  production of
motor gasoline and as fuel for residential and commercial heating.

     The  Company's  processing  operations  are  concentrated  in Mont Belvieu,
Texas,  which is the hub of the  domestic  NGL  industry  and is adjacent to the
largest  concentration  of  refineries  and  petrochemical  plants in the United
States. The facilities operated by the Company at Mont Belvieu include:  (i) one
of the largest NGL fractionation facilities in the United States with an average
production  capacity  of  210,000  barrels  per  day;  (ii) the  largest  butane
isomerization  complex in the United States with an average isobutane production
capacity of 116,000  barrels per day;  (iii) one of the largest MTBE  production
facilities  in the United States with an average  production  capacity of 14,800
barrels  per day;  and (iv) two  propylene  fractionation  units with an average
combined  production capacity of 31,000 barrels per day. The Company owns all of
the  assets  at its  Mont  Belvieu  facility  except  for the NGL  fractionation
facility,  in  which  it owns an  effective  37.0%  economic  interest  (see NGL
Fractionation below); one of the propylene fractionation units, in which it owns
a 54.6% interest and controls the remaining  interest through a long-term lease;
the MTBE production  facility,  in which it owns a 33-1/3% interest;  and one of
its three  isomerization  units  and one  deisobutanizer  which  are held  under
long-term  leases with  purchase  options.  The Company  also owns and  operates
approximately  35 million  barrels  of  storage  capacity  at Mont  Belvieu  and
elsewhere that are an integral part of its processing  operations,  a network of
approximately   500  miles  of  pipelines   along  the  Gulf  Coast  and  a  NGL
fractionation facility in Petal, Mississippi with an average production capacity
of 7,000  barrels per day.  The Company also leases and operates one of only two
commercial NGL import/export terminals on the Gulf Coast.

                                       9
<PAGE>

         Industry Environment

     Because certain NGL products compete with other refined petroleum  products
in the fuel and petrochemical  feedstock markets,  NGL product prices are set by
or in competition  with refined  petroleum  products.  Increased  production and
importation  of NGLs and NGL  products  in the United  States may  decrease  NGL
product  prices in  relation  to  refined  petroleum  alternatives  and  thereby
increase  consumption of NGL products as NGL products are  substituted for other
more  expensive  refined  petroleum  products.  Conversely,  a  decrease  in the
production  and  importation of NGLs and NGL products could increase NGL product
prices in  relation to refined  petroleum  product  prices and thereby  decrease
consumption  of NGLs.  However,  because  of the  relationship  of crude oil and
natural gas production to NGL production,  the Company believes any imbalance in
the prices of NGLs and NGL products and alternative products would be temporary.

     Historically,  when the price of crude oil is a multiple  of ten or more to
the price of natural gas (i.e.,  crude oil $20 per barrel and natural gas $2 per
thousand cubic feet  ("MCF")),  NGL pricing has been strong due to increased use
in manufacturing petrochemicals. In 1998, the industry experienced an annualized
multiple of approximately six (i.e., crude oil $12 per barrel and natural gas $2
per MCF),  which  caused  petrochemical  manufacturing  demand  to  change  from
reliance on NGLs to a preference for crude oil derivatives. This change resulted
in the lowering of both the production and pricing of NGLs. In the NGL industry,
revenues and cost of goods sold can fluctuate  significantly up or down based on
current NGL prices.  However,  operating  margins will generally remain constant
except for the effect of inventory  price  adjustments  or  increased  operating
expenses.

         NGL Fractionation

     The profitability of this business unit depends on the volume of mixed NGLs
that  the  Company  processes  for its  toll  customers  and the  level  of toll
processing fees charged to its customers.  The most significant variable cost of
fractionation  is the cost of energy  required  to operate the units and to heat
the mixed NGLs to effect separation of the NGL products.  The Company is able to
reduce  its  energy  costs  by  capturing  excess  heat and  re-using  it in its
operations.  Additionally,  the Company's NGL fractionation processing contracts
typically  contain  escalation  provisions  for cost  increases  resulting  from
increased variable costs,  including energy costs. The Company's interest in the
operations of its NGL  fractionation  facilities  at Mont Belvieu  consists of a
directly-owned  12.5% undivided  interest and a 49.0% economic  interest in MBA,
which in turn owns a 50.0% undivided interest in such facilities.  The Company's
12.5%  interest is recorded as part of revenues and expenses,  and its effective
24.5% economic interest is recorded as an equity investment in an unconsolidated
subsidiary.

     On July 28, 1999, the Company announced that it had agreed to general terms
and  conditions  for the purchase of Kinder  Morgan Energy  Partners  L.P.'s 50%
economic interest in MBA for $41 million in cash and approximately $4 million in
debt assumption. In conjunction with this transaction,  the Company will acquire
EPCO's 1% interest in MBA for an undisclosed  amount of cash. Upon completion of
this  transaction,   the  Company's  ownership  interest  in  the  Mont  Belvieu
fractionation facility will increase from 37.0% to 62.5%. The parties anticipate
closing this transaction in August 1999.

         Isomerization

     The  profitability  of this  business  unit depends on the volume of normal
butane that the Company isomerizes (i.e.,  converts) into isobutane for its toll
processing  customers,  the  level  of  toll  processing  fees  charged  to  its
customers,  and  the  margins  generated  from  selling  isobutane  to  merchant
customers.  The Company's  toll  processing  customers pay the Company a fee for
isomerizing their normal butane into isobutane.  In addition,  the Company sells
isobutane  that  it  obtains  by  isomerizing   normal  butane  into  isobutane,
fractionating  mixed butane into  isobutane  and normal  butane,  or  purchasing
isobutane in the spot market.  The Company  determines  the optimal  sources for
isobutane to meet sales  obligations based on current and expected market prices
for isobutane and normal butane, volumes of mixed butane held in inventory,  and
estimated costs of isomerization and mixed butane fractionation.

                                       10
<PAGE>

     The Company purchases most of its imported mixed butanes between the months
of February and October.  During these  months,  the Company is able to purchase
imported  mixed  butanes at prices that are often at a discount to posted market
prices.  Because of its  storage  capacity,  the  Company is able to store these
imports  until the summer  months when the spread  between  isobutane and normal
butane  typically widens or until winter months when the prices of isobutane and
normal butane typically rise. As a result,  inventory investment is generally at
its  highest  level at the end of the third  quarter  of the year.  Should  this
spread  not  materialize,  or in the  event  absolute  prices  decline,  margins
generated  from  selling  isobutane  to  merchant  customers  may be  negatively
affected.

         Propylene Fractionation

     The  profitability  of  this  business  unit  depends  on  the  volumes  of
refinery-sourced  propane/propylene  mix that the Company processes for its toll
customers,  the level of toll  processing  fees charged to its customers and the
margins  associated  with  buying  refinery-sourced  propane/propylene  mix  and
selling  high  purity   propylene  to  meet  sales  contracts  with  non-tolling
customers.

         Pipelines

     The  Company  operates  both  interstate  and  intrastate  NGL  product and
propylene pipelines.  The Company's interstate pipelines are common carriers and
must  provide  service to any shipper who  requests  transportation  services at
rates regulated by the Federal Energy Regulatory Commission ("FERC"). One of the
Company's  intrastate  pipelines is a common  carrier  regulated by the State of
Louisiana.  The  profitability  of this business unit is primarily  dependent on
pipeline throughput volumes.

         Unconsolidated Affiliates

     At June 30, 1999, the Company's significant  unconsolidated affiliates were
BEF,  MBA,  EPIK,  BRF,  Tri-States,  Wilprise,  and  Entell.  BEF owns the MTBE
production  facility  operated by the Company at its Mont Belvieu  complex.  MBA
owns a 50%  interest  in a NGL  fractionation  facility  at the  Company's  Mont
Belvieu  complex.  EPIK owns a refrigerated NGL marine terminal loading facility
located on the Houston ship channel.  An expansion of EPIK's NGL marine terminal
loading  facility is under way and is  scheduled  for  completion  in the fourth
quarter  of 1999.  BRF owns a NGL  fractionation  facility  in  Louisiana.  This
facility is expected to begin  operations in August 1999.  Tri-States owns a NGL
pipeline in  Louisiana,  Mississippi,  and Alabama which became  operational  in
March 1999.  Wilprise owns a NGL pipeline in Louisiana.  Management  anticipates
that the Wilprise pipeline will become fully operational in the third quarter of
1999 in conjunction with the startup of the BRF fractionation facility.


Results of Operations

     The  Company's  operating  margins by  business  unit for the three and six
month periods ended June 30, 1998 and 1999 were as follows:
<TABLE>
<CAPTION>

                                                      Three Months Ended            Six Months Ended
                                                           June 30,                     June 30,
                                                      1998          1999          1998           1999
                                                 ----------------------------------------------------------
<S>                                                   <C>           <C>           <C>            <C>
Operating Margin:
      NGL Fractionation.........................      $   697       $   726       $ 1,544       $ 1,532
      Isomerization.............................       10,808        12,359        13,462        17,996
      Propylene Fractionation...................        2,454         6,354         4,466        11,440
      Pipeline .................................        3,772         1,621         7,047         3,715
      Storage and Other Plants..................        3,051           256         3,339           135
                                                 ==========================================================
Total                                                 $20,782       $21,316       $29,858       $34,818
                                                 ==========================================================
</TABLE>

                                       11
<PAGE>

     The Company's  plant  production data (in thousands of barrels per day) for
the three and six month periods ended June 30, 1998 and 1999 were as follows:
<TABLE>
<CAPTION>
                                                      Three Months Ended            Six Months Ended
                                                           June 30,                     June 30,
                                                      1998          1999          1998           1999
                                                 ----------------------------------------------------------
<S>                                                   <C>           <C>           <C>            <C>
Plant Production Data:
      NGL Fractionation                               205           166           206            158
      Isomerization                                    67            74            65             71
      MTBE                                             14            15            12             13
      Propylene Fractionation                          27            31            26             27
</TABLE>

     The Company's equity in income of unconsolidated  affiliates (in thousands)
for the  three  and six  month  periods  ended  June 30,  1998 and 1999  were as
follows:
<TABLE>
<CAPTION>
                                        Three Months ended                Six Months ended
                                             June 30,                         June 30,
                                      1998             1999            1998             1999
                                 ------------------------------------------------------------------
<S>                                    <C>              <C>             <C>              <C>
BEF                                    $2,381           $1,936          $3,254           $2,237
MBA                                     1,494              424           3,443            1,184
BRF                                         -             (143)              -             (286)
EPIK                                      (44)            (220)            (44)             177
Entell                                      -              883               -            1,131
                                 ==================================================================
Total                                  $3,831           $2,880          $6,653           $4,443
                                 ==================================================================
</TABLE>

Three Months Ended June 30, 1999 Compared with Three Months Ended June 30, 1998

     Revenues; Costs and Expenses

     The Company's  revenues decreased by 16% to $174.6 million in 1999 compared
to $207.6 million in 1998. The Company's costs and expenses  decreased by 18% to
$153.3 million in 1999 compared to $186.8 million in 1998.  Revenues and cost of
goods sold for the second  quarter of 1998 were $32.4 million higher than in the
second  quarter of 1999 due to higher  than  normal  sales of normal  butane and
contained propylene  inventories.  Excess inventory volumes of these commodities
were sold in  anticipation  of  forecasted  declines in NGL  prices.  In the NGL
industry,  revenues and costs and expenses can fluctuate  significantly based on
the level of NGL prices without necessarily  affecting margin.  Operating margin
increased by 2% to $21.3 million in 1999 compared to $20.8 million in 1998.

     NGL  Fractionation..  The Company's  operating margin for NGL fractionation
was $0.7 million for both 1999 and 1998.  Excluding the positive  effect of $0.5
million in overhead expenses and support facility cost reimbursements from joint
venture  partners in 1999,  the Company's  NGL  fractionation  operating  margin
decreased  71% to $0.2 million in 1999 from $0.7 million in 1998.  Average daily
fractionation  volumes  decreased from 205 MBPD ("thousands of barrels per day")
in 1998 to 166 MBPD in 1999. The lower  fractionation  rates are attributable to
decreased  volumes from joint owners and third party  customers  stemming partly
from  reduced  drilling  activity  (and  thus  natural  gas  production)  in the
producing  regions  brought  on by a  decrease  in oil  and gas  prices  and the
short-term  diversion of customer  volumes to a  competitor.  The Company  fully
expects  that the  diverted  volumes will be recovered in the next six to twelve
months.

     Isomerization.  The Company's operating margin for isomerization  increased
15% to $12.4  million  in 1999  compared  to $10.8  million  in 1998.  Isobutane
volumes  from  tolling and merchant  activities  for the second  quarter of 1999
averaged  107 MBPD as  compared  to 106 MBPD for the same  period  in 1998.  The
operating  margin for 1999 included a $0.7 million benefit from the amortization
of the  deferred  gain  associated  with the sale  and  leaseback  of one of the
Company's  isomerization units. Excluding this benefit, the operating margin for
1999 would have been $11.7 million as compared to $10.8 million in 1998.

                                       12
<PAGE>

     Average daily toll  processing  volumes were 58 MBPD in 1999 compared to 56
MBPD in 1998.  Isobutane volumes related to merchant  activities were 49 MBPD in
1999 and 1998.  Isobutane  volumes were slightly higher in the second quarter of
1999  compared to second  quarter of 1998 due to  increased  export  volumes and
higher isobutane prices.

     Propylene  Fractionation.  The Company's operating margin increased 156% to
$6.4 million in 1999 from $2.5 million in 1998.  Propylene production during the
second  quarter  averaged 31 MBPD in 1999 as  compared  to 27 MBPD in 1998.  The
earnings  improvement  was primarily  attributable  to the Company's  actions to
maximize  earnings while  minimizing  price risk in the merchant portion of this
business by matching the volume,  timing and price of feedstock  purchases  with
sales of the product.  Earnings  also  benefited  from an increase in production
volumes  associated  with spot business  caused by increased  demand for polymer
grade propylene.

     Pipeline.  The Company's operating margin from pipeline operations was $1.6
million in 1999  compared  to $3.8  million in 1998.  The  decrease  in Pipeline
margin for the quarter was primarily  attributable to the Company's contribution
of certain  wholly-owned  pipeline assets, in the first quarter of 1999, and its
export  loading  facility,  in June 1998, to joint ventures in which the Company
owns a 50% interest.  As a result, the earnings from these assets since the time
of  their  contribution  are  included  in  equity  income  from  unconsolidated
affiliates  as  prescribed  by the equity  method of  accounting  rather than in
earnings  from  consolidated  Pipeline  operations.  This  change in  accounting
treatment  accounts for approximately  $1.9 million of the decrease.  Throughput
for the second quarter of 1999 averaged 189 MBPD as compared to 220 MBPD for the
same period in 1998.

     Selling, General and Administrative Expenses

     Selling, general and administrative expenses decreased $2.9 million to $3.0
million in 1999 from $5.9 million in 1998.  This  decrease was  primarily due to
the  adoption  of the  EPCO  Agreement  in July  1998 in  conjunction  with  the
Company's  initial public  offering  ("IPO") which fixed  reimbursable  selling,
general,  and  administrative  expenses at an initial amount of $1.0 million per
month.

     Interest Expense

     Interest  expense for the second  quarter was $1.9 million in 1999 and $4.1
million in 1998.  This  decrease  was  principally  due to the reduced  level of
average debt  outstanding  during the first quarter of 1999  attributable to the
retirement of debt in July 1998 using proceeds from the Company's IPO.

     Equity Income in Unconsolidated Affiliates

     Equity  income  in  unconsolidated  affiliates  was  $2.9  million  in 1999
compared to $3.8 million in 1998. Equity income from BEF decreased 21% from $2.4
million in 1998 to $1.9  million  in 1999.  Equity  income  from BEF in 1999 was
affected by  contractual  spot sales of MTBE in April 1999 and May 1999 . Equity
income from MBA  decreased 73% to $0.4 million in 1999 from $1.5 million in 1998
due to decreased  throughput from joint owners and third party customers.  Among
the Company's new projects, equity income from Entell was $0.9 million with EPIK
showing a loss of $0.2  million.  Equity  income from EPIK is seasonal  based on
export needs which are at a peak during the  September to February  time period.
BRF,  which is  still in the  development  stage,  showed a slight  loss of $0.1
million.

                                       13
<PAGE>

Six Months Ended June 30, 1999 Compared with Six Months Ended June 30, 1998


Revenues; Costs and Expenses

     The Company's  revenues decreased by 19% to $321.9 million in 1999 compared
to $398.1 million in 1998. The Company's costs and expenses  decreased by 22% to
$287.1  million in 1999  compared to $368.2  million in 1998.  Both revenues and
cost of  goods  sold  decreased  from  1998 to 1999 due to  merchant  activities
associated with reductions of excess inventories in 1998 and declines in average
NGL prices.  Operating margin increased by 16% to $34.8 million in 1999 compared
to $29.9 million in 1998.

     NGL Fractionation. The Company's operating margin for NGL fractionation was
$1.5  million  for both 1999 and 1998.  Excluding  the  positive  effect of $1.1
million in overhead expenses and support facility cost reimbursements from joint
venture  partners in 1999,  the Company's  NGL  fractionation  operating  margin
decreased  73% to $0.4 million in 1999 from $1.5 million in 1998.  Average daily
fractionation  volumes  decreased  from  201  MBPD in 1998 to 180  MBPD in 1999.
Fractionation  volumes are lower in 1999 as compared  to 1998 due  primarily  to
ethane rejection,  downtime associated with preventative maintenance activities,
lower natural gas  production  caused by depressed  oil and gas prices,  and the
short-term  diversion  of  customer  volumes to a  competitor.  During the first
quarter  of 1999,  natural  gas prices  remained  higher  than the  energy  unit
equivalent of ethane; therefore, upstream natural gas processing plants rejected
ethane  which  reduced  the  volumes   delivered  to  Company   facilities   for
fractionation services. The Company took advantage of the reduced demand for its
fractionation  services  during the first  quarter  of 1999 to  perform  certain
preventative  maintenance procedures on one of its fractionation facilities that
are generally  required  every two to three years.  During the second quarter of
1999,  volumes were reduced due to the short-term  diversion of customer volumes
to a competitor.  Management  expects that these volumes will be fully recovered
in the next six to twelve months.

     Isomerization.  The Company's operating margin for isomerization  increased
33% to $18.0  million  in 1999  compared  to $13.5  million  in 1998.  Isobutane
volumes  from  tolling and  merchant  activities  for 1999  averaged 101 MBPD as
compared to 99 MBPD for the same period in 1998.  The operating  margin for 1999
included a $1.3 million  benefit  from the  amortization  of the  deferred  gain
associated  with the sale and  leaseback of one of the  Company's  isomerization
units.  Excluding  this benefit,  the operating  margin for 1999 would have been
$16.7 million as compared to $13.5 million in 1998.

     Average daily toll processing volumes were 57 MBPD in 1999, or 80% of total
volumes produced, compared to 55 MBPD in 1998, or 85% of total volumes produced.
Isobutane volumes related to merchant  activities were 44 MBPD in 1999 and 1998.
Isobutane  volumes are higher in 1999  compared to 1998 due to increased  export
volumes and higher isobutane prices.

     Propylene  Fractionation.  The Company's operating margin increased 153% to
$11.4 million in 1999 from $4.5 million in 1998.  Propylene  production averaged
27 MBPD in 1999 as compared to 26 MBPD in 1998.  The  earnings  improvement  was
primarily attributable to the Company's actions to minimize risk in the merchant
portion of this  business by matching the volume,  timing and price of feedstock
purchases with sales of end products.  The operating  margin also benefited from
an  increase in  production  volumes  associated  with spot  business  caused by
increased demand for polymer grade propylene.

     Pipeline.  The Company's operating margin from pipeline operations was $3.7
million in 1999 compared to $7.0 million in 1998.  Throughput  for 1999 averaged
180 MBPD as compared to 201 MBPD for the same  period in 1998.  The  decrease in
throughput  was  primarily  attributable  to a decrease in import  volumes.  The
decrease in Pipeline margin is principally related to the Company's contribution
of certain  wholly-owned  pipeline assets, in the first quarter of 1999, and its
export  loading  facility,  in June 1998 to joint  ventures in which the Company
owns a 50% interest.  As a result, the earnings from these assets since the time
of  their  contribution  are  included  in  equity  income  from  unconsolidated
affiliates  as  prescribed  by the equity  method of  accounting  rather than in
earnings  from  consolidated  pipeline  operations.  This  change in  accounting
treatment accounts for $2.8 million of the decrease.

                                       14

<PAGE>

     Selling, General and Administrative Expenses

     Selling, general and administrative expenses decreased $5.6 million to $6.0
million in 1999 from $11.6  million in 1998.  This decrease was primarily due to
the  adoption  of the  EPCO  Agreement  in July  1998 in  conjunction  with  the
Company's  initial public  offering  ("IPO") which fixed  reimbursable  selling,
general, and administrative expenses at $1.0 million per month.

     On July 7, 1999, the Audit and Conflicts  Committee of Enterprise  Products
GP, LLC (the  general  partner of the  Company)  authorized  an  increase in the
administrative  services  fee to $1.1 million per month in  accordance  with the
EPCO Agreement. The increased fees are effective August 1, 1999.

     Interest Expense

     Interest  expense was $4.0 million in 1999 and $10.8 million in 1998.  This
decrease was  principally  due to the reduced level of average debt  outstanding
during the first quarter of 1999  attributable to the retirement of debt in July
1998 using proceeds from the Company's IPO.

     Equity Income in Unconsolidated Affiliates

     Equity  income  in  unconsolidated  affiliates  was  $4.4  million  in 1999
compared to $26.7  million in 1998.  Equity  income from BEF  decreased 33% from
$3.3  million in 1998 to $2.2 million in 1999.  Equity  income from BEF for both
periods was  affected by  required  annual  maintenance  on the  Company's  MTBE
facility that generally takes the unit out of production for approximately three
weeks.  Equity income from BEF during 1999 also includes a $1.5 million non-cash
charge for the cumulative effect of a change in accounting  principal related to
the write-off of deferred  start-up  costs as  prescribed by generally  accepted
accounting  principles.  Equity income from MBA decreased 65% to $1.2 million in
1999 from $3.4 million in 1998 due primarily to decreased  throughput  caused by
ethane  rejection  and  downtime   associated  with   preventative   maintenance
activities.  Among the Company's new projects,  equity income from EPIK was $0.2
million  and Entell was $1.1  million.  BRF,  which is still in the  development
stage, showed a slight loss of $0.3 million.


Financial Condition and Liquidity

General

     The Company's  primary cash  requirements,  in addition to normal operating
expenses, are debt service, maintenance capital expenditures,  expansion capital
expenditures,  and quarterly  distributions to the partners. The Company expects
to fund future cash distributions and maintenance capital expenditures with cash
flows from operating  activities.  Expansion  capital  expenditures  for current
projects are expected to be funded with working capital and borrowings under the
revolving bank credit facility  described below while capital  expenditures  for
future  expansion  activities  are  expected  to be funded  with cash flows from
operating activities and borrowings under the revolving bank credit facility.

     Cash flows from  operating  activities  were a $14.2 million inflow for the
first six months of 1999 compared to a $19.1 million  outflow for the comparable
period of 1998.  Cash flows from  operating  activities  primarily  reflect  the
effects of net  income,  depreciation  and  amortization,  extraordinary  items,
equity  income of  unconsolidated  affiliates  and  changes in working  capital.
Depreciation and  amortization  increased by $0.4 million in 1999 as a result of
additional capital expenditures. The net effect of changes in operating accounts
from year to year is generally  the result of timing of NGL sales and  purchases
near the end of the period.

                                       15

<PAGE>

     Cash  outflows  from  investing  activities  were $31.6 million in 1999 and
$13.3 million for the comparable  period of 1998. Cash outflows included capital
expenditures of $2.5 million for 1999 and $7.4 million for 1998. Included in the
capital  expenditures  amounts  are  maintenance  capital  expenditures  of $0.7
million for 1999 and $3.5 million for 1998. Investing cash outflows in 1999 also
included  $40.4  million  in  advances  to  and  investments  in  unconsolidated
affiliates  versus $14.5 million for the  comparable  period of 1998.  The $25.9
million  increase  stems  primarily  from  contributions  made to the  Wilprise,
Tri-States,  and BRF joint  ventures  located in  Louisiana.  Also,  the Company
received $7.4 million in payments on notes receivable from the BEF and MBA notes
purchased during 1998 with the proceeds of the Company's IPO.

     Cash flows from financing  activities  were a $2.8 million  outflow in 1999
versus a $13.4 million  outflow for the  comparable  period of 1998.  Cash flows
from  financing  activities  are affected  primarily by  repayments of long-term
debt,  borrowings  under the long-term debt agreements and  distributions to the
partners.  Cash flows from  financing  activities  for 1999 also  reflected  the
purchase of $4.6 million of Common Units by a consolidated trust.

     Future Capital Expenditures

     The Company  currently  estimates that its share of remaining  expenditures
for  significant  capital  projects in fiscal 1999 will be  approximately  $14.8
million. These expenditures relate to the construction of joint venture projects
which will be recorded as additional  investments in unconsolidated  affiliates.
The Company  forecasts that an additional  $6.7 million will be spent in 1999 on
capital projects that will be recorded as property,  plant,  and equipment.  The
Company  expects to finance these  expenditures  out of operating cash flows and
borrowings  under its bank credit  facilities.  As of June 30, 1999, the Company
had $8.7 million in outstanding purchase commitments attributable to its capital
projects.  Of this amount,  $6.1 million is associated with significant  capital
projects  which will be recorded as  additional  investments  in  unconsolidated
affiliates for accounting purposes.

     Distributions from Unconsolidated Affiliates; Loan Participations

     Distributions  to the Company  from MBA were $1.1  million in 1999 and $1.2
million in 1998.  Distributions  from BEF in 1999 were $0.3 million  versus $1.4
million in 1998.  Prior to the first quarter of 1998, BEF was  prohibited  under
the terms of its bank indebtedness from making  distributions to its owners. The
restrictions  lapsed  during the first quarter of 1998 as a result of BEF having
repaid 50% of the principal on such indebtedness, with the Company receiving its
first  distribution from BEF in April 1998. The April 1998 distribution from BEF
included a special  one-time  disbursement of $1.5 million in debt reserve funds
allowed by its lenders.  Distributions from EPIK in 1999 were $1.1 million. EPIK
was formed in the  second  quarter  of 1998 and had no  distributions  until the
third quarter of 1998.

     In  connection   with  the  IPO  in  July  1998,   the  Company   purchased
participation  interests  in a bank  loan  to MBA and a bank  loan  to BEF.  The
Company acquired an approximate $7.7 million participation  interest in the bank
debt of MBA,  which bears  interest  at a floating  rate per annum of LIBOR plus
0.75% and  matures on  December  31,  2001.  The  Company is  receiving  monthly
principal  payments,  aggregating  approximately  $1.7  million  per year,  plus
interest from MBA during the term of the loan.  The Company will receive a final
payment of principal  and interest of $1.8  million upon  maturity.  The Company
acquired an approximate $26.1 million  participation  interest in a bank loan to
BEF,  which  bears  interest  at a floating  rate per annum at either the bank's
prime  rate,  CD rate,  or the  Eurodollar  rate plus the  applicable  margin as
defined in the facility  and matures on May 31,  2000.  The Company is receiving
quarterly  principal  payments of approximately  $3.3 million plus interest from
BEF during the term of the loan.

Bank Credit Facility

     Existing Bank Credit facility.  In July 1998, Enterprise Products Operating
L.P. (the  "Operating  Partnership")  entered into a $200.0  million bank credit
facility  that includes a $50.0 million  working  capital  facility and a $150.0
million  revolving  term loan facility.  The $150.0 million  revolving term loan
facility  includes a sublimit of $30.0 million for letters of credit. As of June
30,  1999,  the  Company  has  borrowed  $145.0  million  under the bank  credit
facility.

                                       16

<PAGE>

     The  Company's  obligations  under the bank credit  facility are  unsecured
general  obligations  and are  non-recourse to the General  Partner.  Borrowings
under the bank credit  facility  will bear  interest at either the bank's  prime
rate or the  Eurodollar  rate  plus the  applicable  margin  as  defined  in the
facility.  The bank credit  facility will expire after two years and all amounts
borrowed  thereunder  shall be due and  payable on such  date.  There must be no
amount   outstanding  under  the  working  capital  facility  for  at  least  15
consecutive days during each fiscal year.

     The credit  agreement  relating to the facility  contains a prohibition  on
distributions  on, or purchases or redemptions of, Units if any event of default
is  continuing.   In  addition,   the  bank  credit  facility  contains  various
affirmative and negative covenants  applicable to the ability of the Company to,
among  other  things,  (i) incur  certain  additional  indebtedness,  (ii) grant
certain  liens,  (iii) sell assets in excess of certain  limitations,  (iv) make
investments,  (v) engage in  transactions  with affiliates and (vi) enter into a
merger,  consolidation or sale of assets. The bank credit facility requires that
the Operating  Partnership  satisfy the following financial covenants at the end
of each fiscal quarter: (i) maintain Consolidated Tangible Net Worth (as defined
in the bank credit facility) of at least  $257,000,000  plus 75% of the net cash
proceeds from the sale of equity  securities of the Company that are contributed
to the Operating Partnership, (ii) maintain a ratio of EBITDA (as defined in the
bank credit  facility) to Consolidated  Interest Expense (as defined in the bank
credit  facility) for the previous  12-month  period of at least 3.50 to 1.0 and
(iii)  maintain a ratio of Total  Indebtedness  (as  defined in the bank  credit
facility) to EBITDA of no more than 2.25 to 1.0.

     A "Change of Control" constitutes an Event of Default under the bank credit
facility.  A Change of Control includes any of the following events:  (i) Dan L.
Duncan  (and  certain  affiliates)  cease  to own (a) at  least  51% (on a fully
converted, fully diluted basis) of the economic interest in the capital stock of
EPCO or (b) an aggregate number of shares of capital stock of EPCO sufficient to
elect a majority  of the board of  directors  of EPCO;  (ii) EPCO ceases to own,
through a wholly owned  subsidiary,  at least 95% of the outstanding  membership
interest  in the  General  Partner  and at least 51% of the  outstanding  Common
Units;  (iii)  any  person  or  group  beneficially  owns  more  than 20% of the
outstanding  Common  Units;  (iv) the General  Partner  ceases to be the general
partner of the Company or the Operating  Partnership;  or (v) the Company ceases
to be the sole limited partner of the Operating Partnership.

     New Bank Credit facility.  On July  28,  1999,  the  Operating  Partnership
entered into a $350.0 million bank credit facility that includes a $50.0 million
working capital facility and a $300.0 million revolving term loan facility.  The
$300.0 million revolving term loan facility includes a sublimit of $10.0 million
for letters of credit.  The proceeds of this loan will be used  principally  for
the acquisition of the Tejas assets,  the Lou-Tex pipeline,  and Kinder Morgan's
interest in the fractionation facility.

     Borrowings  under the bank credit facility will bear interest at either the
bank's prime rate or the Eurodollar  rate plus the applicable  margin as defined
in the  facility.  The bank credit  facility will expire after two years and all
amounts borrowed thereunder shall be due and payable on such date. There must be
no  amount  outstanding  under  the  working  capital  facility  for at least 15
consecutive days during each fiscal year.

     The credit agreement relating to the new facility contains a prohibition on
distributions  on, or purchases or  redemptions of Units if any event of default
is  continuing.   In  addition,   the  bank  credit  facility  contains  various
affirmative and negative covenants  applicable to the ability of the Company to,
among  other  things,  (i) incur  certain  additional  indebtedness,  (ii) grant
certain  liens,  (iii) sell assets in excess of certain  limitations,  (iv) make
investments,  (v) engage in  transactions  with affiliates and (vi) enter into a
merger, consolidation, or sale of assets. The bank credit facility requires that
the Operating  Partnership  satisfy the following financial covenants at the end
of each fiscal quarter: (i) maintain Consolidated Tangible Net Worth (as defined
in the bank credit facility) of at least $250,000,000,  (ii) maintain a ratio of
EBITDA (as defined in the bank credit facility) to Consolidated Interest Expense
(as defined in the bank credit facility) for the previous  12-month period of at
least 3.5 to 1.0 and (iii) maintain a ratio of Total Indebtedness (as defined in
the bank credit facility) to EBITDA of no more than 3.0 to 1.0.

     A "Change of Control" constitutes an Event of Default under the bank credit
facility.  A Change of Control includes any of the following events:  (i) Dan L.
Duncan  (and  certain  affiliates)  cease  to own (a) at  least  51% (on a fully
converted, fully diluted basis) of the economic interest in the capital stock of
EPCO or (b) an aggregate number of shares of capital stock of EPCO sufficient to
elect a majority  of the board of  directors  of EPCO;  (ii) EPCO ceases to own,
through a wholly owned  subsidiary,  at least 65% of the outstanding  membership
interest  in the  General  Partner  and at least a majority  of the  outstanding
Common Units;  (iii) any person or group  beneficially owns more than 20% of the
outstanding  Common  Units;  (iv) the General  Partner  ceases to be the general
partner of the Company or the Operating  Partnership;  or (v) the Company ceases
to be the sole limited partner of the Operating Partnership.

                                       17

<PAGE>

MTBE Production

     The Company owns a 33-1/3%  economic  interest in the BEF partnership  that
owns the MTBE  production  facility  located  within the Company's  Mont Belvieu
complex.  The production of MTBE is driven by oxygenated  fuels programs enacted
under the federal Clean Air Act  Amendments of 1990 and other  legislation.  Any
changes to these programs that enable  localities to opt out of these  programs,
lessen the requirements  for oxygenates or favor the use of non-isobutane  based
oxygenated  fuels reduce the demand for MTBE and could have an adverse effect on
the Company's results of operations.

     On March 25, 1999, the Governor of California ordered the phase-out of MTBE
in that state by the end of 2002 due to allegations  by several public  advocacy
and protest groups that MTBE contaminates water supplies, causes health problems
and  has not  been  as  beneficial  in  reducing  air  pollution  as  originally
contemplated.  The  order  also  seeks  to  obtain  a  waiver  of the  oxygenate
requirement from the federal Environmental Protection Agency ("EPA") in order to
facilitate  the phase-out.  In addition,  legislation to amend the federal Clean
Air Act of 1990 has been introduced in the U.S. House of  Representatives to ban
the use of MTBE as a fuel additive within three years. Legislation introduced in
the U.S.  Senate would  eliminate the Clean Air Act's  oxygenate  requirement in
order to assist the elimination of MTBE in fuel. No assurance can be given as to
whether  this or  similar  federal  legislation  ultimately  will be  adopted or
whether  Congress  or the EPA  might  takes  steps to  override  the MTBE ban in
California.

     In November 1998, U.S. EPA Administrator  Carol M. Browner appointed a Blue
Ribbon Panel (the  "Panel") to  investigate  the air quality  benefits and water
quality  concerns  associated  with  oxygenates  in  gasoline,  and  to  provide
independent  advice and  recommendations  on ways to maintain air quality  while
protecting  water  quality.  The  Panel  issued a report on their  findings  and
recommendations  in July 1999. The Panel urged the  widespread  reduction in the
use of MTBE due to the growing  threat to drinking  water  sources  despite that
fact that use of  reformulated  gasolines have  contributed  to significant  air
quality improvements. The Panel credited reformulated gasoline with "substantial
reductions"  in  toxic  emissions  from  vehicles  and  recommended  that  those
reductions  be  maintained  by the use of  cleaner-burning  fuels  that  rely on
additives  other than MTBE and  improvements  in refining  processes.  The Panel
stated  that  the  problems  associated  with  MTBE  can be  characterized  as a
low-level, widespread problem that had not reached the state of a being a public
health threat. The Panel's  recommendations  are geared towards  confronting the
problems  associated  with MTBE now rather  than  letting  the issue grow into a
larger and worse problem. The Panel did not call for an outright ban on MTBE but
stated that its use should be curtailed significantly. The Panel also encouraged
a public  educational  campaign on the potential  harm posed by gasoline when it
leaks into ground water from storage tanks or while in use. Based on the Panel's
recommendations,  the EPA will ask  Congress for a revision of the Clean Air Act
of 1990 that  maintains  air  quality  gains and allows  for the  removal of the
oxygenate demand in gasoline.

     In light of these  developments,  the Company is  formulating a contingency
plan for use of the BEF MTBE  facility  if MTBE  were  banned  or  significantly
curtailed.  Management  is exploring a possible  conversion  of the BEF facility
from MTBE  production  to alkylate  production.  At present the forecast cost of
this  conversion  would be in the $15 million to $20 million  range.  Management
anticipates that if MTBE is banned alkylate demand will rise as producers use it
to replace MTBE as an octane enhancer.  Alkylate production would be expected to
generate margins comparable to those of MTBE. Greater alkylate  production would
be expected to increase isobutane consumption  nationwide and result in improved
isomerization margins for the Company.

Year 2000 Readiness Disclosure

     Pursuant to the EPCO  Agreement,  any selling,  general and  administrative
expenses  related  to Year 2000  compliance  issues  are  covered  by the annual
administrative  services  fee paid by the  Company to EPCO.  Consequently,  only
those costs  incurred in connection  with Year 2000  compliance  which relate to
operational  information  systems  and  hardware  will be paid  directly  by the
Company.

                                       18

<PAGE>

     Since  1997,  EPCO has been  assessing  the impact of Year 2000  compliance
issues on the software and hardware used by the Company. A team was assembled to
review and document the status of EPCO's and the Company's systems for Year 2000
compliance.  The key information systems reviewed include the Company's pipeline
Supervisory Control and Data Acquisition  ("SCADA") system,  plant, storage, and
other  pipeline  operating  systems.  In  connection  with each of these  areas,
consideration was given to hardware, operating systems, applications,  data base
management,  system interfaces,  electronic  transmission,  and outside vendors.
Work is nearly  complete in all areas  except for the SCADA  system.  Management
anticipates  that work on all  systems  (including  SCADA)  will be  complete by
October 1, 1999.

     As of June 30, 1999,  EPCO had spent  approximately  $264,500 in connection
with Year 2000  compliance  and has  estimated  the future costs to  approximate
$74,000. This cost estimate does not include internal costs of EPCO's previously
existing  resources  and  personnel  that might be partially  used for Year 2000
compliance or cost of normal system  upgrades  which also included  various Year
2000 compliance  features or fixes.  Such internal costs have been determined to
be materially insignificant to the total estimated cost of Year 2000 compliance.

     At this time, the Company  believes its total cost for known or anticipated
remediation of its information systems to make them Year 2000 compliant will not
be material to its financial position or its ability to sustain  operations.  As
of June 30, 1999, the Company had incurred expenditures  aggregating $154,250 in
connection  with Year 2000  compliance.  The Company  expects future spending to
approximate $871,800  (principally for the SCADA system) to complete the project
and become fully  compliant with all Year 2000 issues.  This estimated cost does
not  include  the  Company's  internal  costs  related  to  previously  existing
resources and personnel  that might be partially  used for  remediation  of Year
2000  compliance  issues.  Such  internal  costs  have  been  determined  to  be
materially  insignificant  to the total estimated cost of Year 2000  compliance.
These  amounts  are  current  cost  estimates  and  actual  future  costs  could
potentially be higher or lower than the estimates.

     The Company relies on third-party  suppliers for certain systems,  products
and services, including  telecommunications.  There can be no assurance that the
systems of other companies on which the Company's  systems rely also will timely
be compliant or that any such failure to be compliant by another  company  would
not have an adverse  effect on the Company's  systems.  The Company has received
some information concerning Year 2000 compliance status from a group of critical
suppliers and vendors, and anticipates  receiving additional  information in the
near future.  This information will assist the Company in determining the extent
to which it may be vulnerable to those third  parties'  failure to address their
Year 2000  compliance  issues.  Based on the  responses  received  to date,  the
Company  believes  that its  critical  suppliers  and vendors  will be Year 2000
compliant.

     Management  believes it has a program to address  the Year 2000  compliance
issue in a timely  manner.  Completion of the plan and testing of replacement or
modified  systems is anticipated by October 1, 1999.  Nevertheless,  since it is
not possible to anticipate all possible future  outcomes,  especially when third
parties are involved, there could be circumstances in which the Company would be
unable to  invoice  customers  or  collect  payments.  The  failure to correct a
material  Year 2000  compliance  problem could result in an  interruption  in or
failure of certain normal business activities or operations of the Company. Such
failures  could have a material  adverse  effect on the  Company.  The amount of
potential liability and lost revenue has not been estimated.

     The  Company  and  EPCO  have  developed  a  contingency  plan  to  address
unavoidable  risks associated with Year 2000 compliance  issues.  Management has
examined  the Year  2000  compliance  issue  and  determined  that a  worst-case
scenario would be a total,  unexpected  facility shutdown caused by a disruption
of  third-party  utilities   (principally  a  total  electrical  power  outage).
Enterprise  personnel  are  trained to respond  timely and  effectively  to such
emergencies;  however,  because  of the  uncertainty  surrounding  the Year 2000
problem,  the Company  will have  additional  resources  available to assist the
operations,  maintenance,  and various  other  groups on  December  31, 1999 and
January 1, 2000.  The Company will have extra  operating,  maintenance,  process
control, computer support,  environmental and safety personnel on site and/or on
standby in the event that a Year 2000 problem arises.  The Company and EPCO will
have a defined team of trained personnel available for the rollover into January
1, 2000, so that any disruption to Company or EPCO facilities can handled safely
and so  that a  return  to  normal  operations  can be  commenced  as soon as is
practicable.

                                       19

<PAGE>

Accounting Standards

     On June 6, 1999, the Financial  Accounting  Standards Board ("FASB") issued
Statement of Financial  Accounting  Standard  ("SFAS) No. 137,  "Accounting  for
Derivative Instruments and Hedging  Activities-Deferral of the Effective Date of
FASB Statement No. 133-an amendment of FASB Statement No. 133" which effectively
delays and amends the  application  of SFAS No. 133  "Accounting  for Derivative
Instruments  and Hedging  Activities"  for one year,  to fiscal years  beginning
after June 15, 2000. Management is currently studying both SFAS No. 137 and SFAS
No. 133 for possible impact on the consolidated financial statements.

     On April 3, 1998, the American  Institute of Certified  Public  Accountants
issued Statement of Position  ("SOP") 98-5,  "Reporting on the Costs of Start-Up
Activities."  For years  beginning  after  December 15, 1998, SOP 98-5 generally
requires that all start-up costs of a business activity be charged to expense as
incurred and any start-up costs  previously  deferred should be written off as a
cumulative  effect of a change in  accounting  principle.  Adoption  of SOP 98-5
during  1999  did not  have a  material  impact  on the  consolidated  financial
statements  except for a $4.5 million noncash write-off that occurred on January
1, 1999 of the unamortized  balance of deferred  start-up costs of BEF, in which
the  Company  owns a 33-1/3%  interest.  This  write-off  caused a $1.5  million
reduction in the equity in income of  unconsolidated  affiliates  for 1999 and a
corresponding   reduction  in  the  Company's   investment   in   unconsolidated
affiliates.

Uncertainty of Forward-Looking Statements and Information.

     This  quarterly  report  contains  various  forward-looking  statements and
information that are based on the belief of the Company and the General Partner,
as well  as  assumptions  made by and  information  currently  available  to the
Company  and the  General  Partner.  When used in this  document,  words such as
"anticipate,"  "estimate,"  "project,"  "expect," "plan," "forecast,"  "intend,"
"could," and "may," and similar  expressions and statements  regarding the plans
and  objectives of the Company for future  operations,  are intended to identify
forward-looking statements. Although the Company and the General Partner believe
that  the  expectations   reflected  in  such  forward-looking   statements  are
reasonable,  they can give no assurance that such  expectations will prove to be
correct.  Such  statements  are  subject to certain  risks,  uncertainties,  and
assumptions.  If one or more of these risks or uncertainties materialize,  or if
underlying assumptions prove incorrect,  actual results may vary materially from
those anticipated, estimated, projected, or expected. Among the key risk factors
that may have a direct  bearing  on the  Company's  results  of  operations  and
financial  condition are: (a)  competitive  practices in the industries in which
the Company  competes,  (b)  fluctuations  in oil,  natural gas, and NGL product
prices and  production,  (c) operational  and systems risks,  (d)  environmental
liabilities  that are not covered by indemnity or  insurance,  (e) the impact of
current and future laws and governmental  regulations  (including  environmental
regulations) affecting the NGL industry in general, and the Company's operations
in particular,  (f) loss of a significant customer,  and (g) failure to complete
one or more new projects on time or within budget.

                                       20

<PAGE>

Item 3.    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

     The Company is exposed to  financial  market  risks,  including  changes in
interest  rates with respect to its  investments  in financial  instruments  and
changes in  commodity  prices.  The Company  may,  but  generally  does not, use
derivative financial instruments (i.e., futures,  forwards,  swaps, options, and
other  financial   instruments  with  similar   characteristics)  or  derivative
commodity instruments (i.e., commodity futures, forwards, swaps, or options, and
other commodity  instruments with similar  characteristics that are permitted by
contract  or  business  custom to be settled in cash or with  another  financial
instrument)  to  mitigate  either of these  risks.  The return on the  Company's
financial   investments   is  generally   not   affected  by  foreign   currency
fluctuations.  The Company does not use  derivative  financial  instruments  for
speculative   purposes.  At  June  30,  1999,  the  Company  had  no  derivative
instruments in place to cover any potential  interest rate,  foreign currency or
other financial instrument risk.

     At June 30, 1999,  the Company had $4.0  million  invested in cash and cash
equivalents.  All cash equivalent investments other than cash are highly liquid,
have original  maturities of less than three months,  and are considered to have
insignificant  interest  rate  risk.  The  Company's  inventory  of NGLs and NGL
products at June 30, 1999,  was $57.6  million.  Inventories  are carried at the
lower of cost or market.  A 10% adverse change in commodity  prices would result
in an  approximate  $5.8  million  decrease  in the fair value of the  Company's
inventory,  based on a sensitivity analysis at June 30, 1999. Actual results may
differ  materially.  All the Company's  long-term  debt is at variable  interest
rates;  a 10% change in the base rate selected  would have an  approximate  $0.7
million effect on the amount of interest expense for the year based upon amounts
outstanding at June 30, 1999.

                                       21
<PAGE>

PART II.    OTHER INFORMATION

Item 6.   Exhibits and Reports on Form 8-K

          (a) Exhibits

     *3.1 Form  of  Amended  and  Restated  Agreement of Limited Partnership of
          Enterprise  Products  Partners  L. P. ( Exhibit 3.1 to Registration
          Statement on Form S-1,File No. 333-52537, filed on May 13, 1998).

     *3.2 Form of Amended  and  Restated  Agreement  of Limited  Partnership  of
          Enterprise  Products  Operating  L.P.  (Exhibit  3.2  to  Registration
          Statement on Form S-1/A, File No. 333-52537, filed on July 21, 1998).

     *3.3 LLC Agreement of Enterprise  Products GP (Exhibit 3.3 to  Registration
          Statement on Form S-1/A, File No. 333-52537, filed on July 21, 1998).

     *4.1 Form of Common Unit certificate (Exhibit 4.1 to Registration Statement
          on Form S-1/A, File No. 333-52537, filed on July 21, 1998).

     *4.2 Credit Agreement among Enterprise Products Operating L.P., the Several
          Banks from Time to Time Parties Hereto,  Den Norske Bank ASA, and Bank
          of Tokyo-Mitsubishi, Ltd., Houston Agency as Co-Arrangers, The Bank of
          Nova Scotia,  as Co-Arranger and as Documentation  Agent and The Chase
          Manhattan Bank as  Co-Arranger  and as Agent dated as of July 27, 1998
          as Amended and Restated as of September 30, 1998. (Exhibit 4.2 on Form
          10-K for year ended December 31, 1998, filed March 17, 1999).

     *10.1 Articles  of Merger  of  Enterprise  Products  Company,  HSC Pipeline
          Partnership, L.P., Chunchula Pipeline Company, LLC, Propylene Pipeline
          Partnership, L.P., Cajun Pipeline Company, LLC and Enterprise Products
          Texas  Operating L.P. dated June 1, 1998 (Exhibit 10.1 to Registration
          Statement on Form S-1/A, File No: 333-52537, filed on July 8, 1998).

     *10.2 Form of EPCO  Agreement  between  Enterprise Products  Partners L.P.,
          Enterprise  Products Operating L.P.,  Enterprise  Products GP, LLC and
          Enterprise Products Company (Exhibit 10.2 to Registration Statement on
          Form S-1/A, File No. 333-52537, filed on July 21, 1998).

     *10.3Transportation  Contract between  Enterprise  Products  Operating L.P.
          and Enterprise Transportation Company dated June 1, 1998 (Exhibit 10.3
          to Registration Statement on Form S-1/A, File No. 333-52537,  filed on
          July 8, 1998).

     *10.4Venture  Participation  Agreement  between Sun  Company,  Inc.  (R&M),
          Liquid Energy Corporation and Enterprise Products Company dated May 1,
          1992  (Exhibit  10.4 to  Registration  Statement on Form S-1, File No.
          333-52537, filed on May 13, 1998).

     *10.5Partnership  Agreement  between Sun BEF,  Inc.,  Liquid  Energy  Fuels
          Corporation and Enterprise Products Company dated May 1, 1992 (Exhibit
          10.5 to Registration Statement on Form S-1, File No. 333-52537,  filed
          on May 13, 1998).

                                       22

<PAGE>

     *10.6Amended  and  Restated  MTBE  Off-Take   Agreement   between   Belvieu
          Environmental Fuels and Sun Company,  Inc. (R&M) dated August 16, 1995
          (Exhibit  10.6  to  Registration  Statement  on  Form  S-1,  File  No.
          333-52537, filed on May 13, 1998).

     *10.7Articles of Partnership of Mont Belvieu Associates dated July 17, 1985
          (Exhibit  10.7  to  Registration  Statement  on  Form  S-1,  File  No.
          333-52537, filed on May 13, 1998).

     *10.8First Amendment to Articles of Partnership of Mont Belvieu  Associates
          dated July 15, 1996  (Exhibit 10.8 to  Registration  Statement on Form
          S-1, File No. 333-52537, filed on May 13, 1998).

     *10.9Propylene   Facility  and  Pipeline   Agreement   between   Enterprise
          Petrochemical  Company and Hercules  Incorporated  dated  December 13,
          1978  (Exhibit  10.9 to  Registration  Statement on Form S-1, File No.
          333-52537, dated May 13, 1998).

     *10.10 Restated  Operating  Agreement  for the Mont  Belvieu  Fractionation
          Facilities Chambers County, Texas between Enterprise Products Company,
          Texaco  Producing  Inc.,  El Paso  Hydrocarbons  Company and  Champlin
          Petroleum  Company dated July 17, 1985 (Exhibit 10.10 to  Registration
          Statement on Form S-1/A, File No. 333-52537, filed on July 8, 1998).

     *10.11  Ratification  and  Joinder  Agreement   relating  to  Mont  Belvieu
          Associates  Facilities  between  Enterprise  Products Company,  Texaco
          Producing  Inc.,  El Paso  Hydrocarbons  Company,  Champlin  Petroleum
          Company and Mont Belvieu Associates dated July 17, 1985 (Exhibit 10.11
          to Registration Statement on Form S-1/A, File No. 333-52537,  filed on
          July 8, 1998).

     *10.12Amendment to Propylene  Facility and Pipeline Sales Agreement between
          HIMONT U.S.A.,  Inc. and Enterprise  Products Company dated January 1,
          1993 (Exhibit 10.12 to Registration  Statement on Form S-1/A, File No.
          333-52537, filed on July 8, 1998).

     *10.13Amendment to Propylene Facility and Pipeline Agreement between HIMONT
          U.S.A.,  Inc. and  Enterprise  Products  Company dated January 1, 1995
          (Exhibit  10.13 to  Registration  Statement  on Form  S-1/A,  File No.
          333-52537, filed on July 8, 1998).

     27.1 Financial Data Schedule

         * Asterisk indicates exhibits incorporated by reference as indicated

                                       23

<PAGE>

         (b) Reports on Form 8-K

         One report on Form 8-K was filed during the second quarter of 1999.

          Form 8-K dated April 20, 1999,  reporting  that the Company  announced
          the general  terms of an agreement  to form a major NGL alliance  with
          Tejas Energy ("Tejas"),  an affiliate of Shell Oil Company  ("Shell").
          Under the terms of the alliance  Shell will  contribute  its ownership
          interests  in its  natural  gas  processing,  NGL  fractionation,  NGL
          storage and NGL transportation  assets in Mississippi and Louisiana to
          the  Company in  exchange  for an equity  interest  in the Company and
          other  consideration.  The completion of this transaction would form a
          strategic  business  combination  comprising a fully  integrated  Gulf
          Coast  NGL  processing,   fractionation,  storage  and  transportation
          business. It also establishes a strategic alliance between the Company
          and Shell whereby the Company would have the rights to process Shell's
          current and future Gulf of Mexico  natural gas  production  and market
          the NGLs recovered.

          All of Tejas' NGL assets in  Louisiana  and  Mississippi  are included
          under  the  terms  of  the  combination.  This  includes  its  varying
          interests in 11 natural gas  processing  plants  (including  one under
          construction)  with a combined  gross  capacity  of  approximately  11
          billion cubic feet per day; four NGL  fractionation  facilities with a
          combined gross capacity of approximately  240,000 barrels per day; NGL
          storage  facilities  with  approximately  29 million  barrels of gross
          capacity; and over 1,800 miles of NGL pipelines (including an interest
          in the Dixie Pipeline).

          The  transaction  is subject  to the  Company  and Tejas  successfully
          executing a  definitive  agreement;  satisfactorily  completing  their
          respective  due  diligence  reviews;  receiving  requisite  regulatory
          approvals  and  receiving  approvals  from  each  company's  board  of
          directors.  The parties anticipate closing of the transaction to occur
          by the end of the third quarter of 1999.

                                       24
<PAGE>

                                   Signatures


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


                                           Enterprise Products Partners L.P.
                                           (A Delaware Limited Partnership)

                                       By: Enterprise Products GP, LLC
                                           as General Partner


Date:   August 9, 1999                 By:      /s/  Gary L. Miller
                                           _____________________________________
                                           Executive Vice President
                                           Chief Financial Officer and Treasurer




                                       25
[{"type": "10-Q", "sequence": "1", "description": "FORM 10-Q", "secsgml_size_bytes": 104107}]
{"company-data": {"conformed-name": "ENTERPRISE PRODUCTS PARTNERS L P", "cik": "0001061219", "assigned-sic": "1311", "irs-number": "760568219", "state-of-incorporation": "DE", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "10-Q", "act": "34", "file-number": "001-14323", "film-number": "99681701"}, "business-address": {"street1": "2727 NORTH LOOP WEST", "city": "HOUSTON", "state": "TX", "zip": "77008", "phone": "7138806500"}}
FORM 10-Q

                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

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

                  For the quarterly period ended June 30, 1999

                                       OR

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

                For the transition period from _______ to _______

Commission file number: 1-14323

                        Enterprise Products Partners L.P.
             (Exact name of Registrant as specified in its charter)

               Delaware                                           76-0568219
(State or other jurisdiction of                               (I.R.S. Employer
incorporation or organization)                               Identification No.)

                              2727 North Loop West
                                 Houston, Texas
                                   77008-1037
               (Address of principal executive offices) (Zip code)

                                 (713) 880-6500
               (Registrant's telephone number including area code)

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

     The  registrant had  45,552,915  Common Units  outstanding as of August 9,
1999.
Enterprise Products Partners L.P. and Subsidiaries

                                TABLE OF CONTENTS
Page
                                                                                           No.
Part I.  Financial Information

Item 1.  Financial Statements

Enterprise Products Partners L.P. Unaudited Consolidated Financial Statements:

         Consolidated Balance Sheets,  June 30, 1999 and December 31, 1998                1

         Statements of Consolidated Operations
                  for the Three and Six Months ended June 30, 1999 and 1998               2

         Statements of Consolidated Cash Flows
                  for the Three and Six Months ended June 30, 1999 and 1998               3

         Notes to Unaudited Consolidated Financial Statements                             4-8

Item 2.  Management's Discussion and Analysis of Financial Condition and
         Results of Operations                                                            9-20

Item 3.  Quantitative and Qualitative Disclosures about Market Risk                      21

Part II. Other Information

Item 6.  Exhibits and Reports on Form 8-K                                                22-24

         Signature Page                                                                   25
PART 1. FINANCIAL INFORMATION.
                          Item 1. FINANCIAL STATEMENTS.

                        Enterprise Products Partners L.P.
                           Consolidated Balance Sheets
                             (Amounts in thousands)
June 30,
                                                                                               December 31,           1999
                                           ASSETS                                                  1998           (Unaudited)
                                                                                             -------------------------------------
Current Assets
       Cash and cash equivalents                                                                 $ 24,103           $  3,959
       Accounts receivable - trade                                                                 57,288             57,644
       Accounts receivable - affiliates                                                            15,546             21,764
       Inventories                                                                                 17,574             55,526
       Current maturities of participation in notes receivable from
           unconsolidated affiliates                                                               14,737             14,737
        Prepaid and other current assets                                                            8,445              7,475
                                                                                             -------------------------------------
                        Total current assets                                                      137,693            161,105
Property, Plant and Equipment, Net                                                                499,793            492,788
Investments in and Advances to Unconsolidated Affiliates                                           91,121            132,005
Participation in Notes Receivable from Unconsolidated Affiliates                                   11,760              4,391
Other Assets                                                                                          670                236
                                                                                             =====================================
                        Total                                                                    $741,037           $790,525
                                                                                             =====================================

                              LIABILITIES AND PARTNERS' EQUITY

Current Liabilities
       Accounts payable - trade                                                                  $ 36,586           $ 36,422
       Accrued gas payables                                                                        27,183             50,047
       Accrued expenses                                                                             7,540              5,591
       Other current liabilities                                                                   11,462              7,819
                                                                                             -------------------------------------
                        Total current liabilities                                                  82,771             99,879
Long-Term Debt                                                                                     90,000            145,000
Minority Interest                                                                                   5,730              5,548
Commitments and Contingencies
Partners' Equity
       Common Units                                                                               433,082            410,958
       Subordinated Units                                                                         123,829            123,693
       General Partner                                                                              5,625              5,447
                                                                                             -------------------------------------
                        Total Partners' Equity                                                    562,536            540,098
                                                                                             =====================================
                        Total                                                                    $741,037           $790,525
                                                                                             =====================================
See Notes to Unaudited Consolidated Financial Statements
                                       1
PART 1. FINANCIAL INFORMATION (continued)
                    Item 1. FINANCIAL STATEMENTS (continued)

                        Enterprise Products Partners L.P.
                      Statement of Consolidated Operations
                                   (Unaudited)
                 (Amounts in thousands, except per Unit amounts)
Three Months Ended                    Six Months Ended
                                                                       June 30,                             June 30,
                                                               1998               1999              1998               1999
                                                         --------------------------------------------------------------------------
REVENUES                                                       $207,566           $174,599          $398,083           $321,913
COST AND EXPENSES
Operating costs and expenses                                    186,784            153,283           368,231            287,095
Selling, general and administrative                               5,857              3,000            11,611              6,000
                                                         --------------------------------------------------------------------------
         Total                                                  192,641            156,283           379,842            293,095
                                                         --------------------------------------------------------------------------
OPERATING INCOME                                                 14,925             18,316            18,241             28,818
                                                         --------------------------------------------------------------------------
OTHER INCOME (EXPENSE)
Interest expense                                                 (4,070)            (1,913)          (10,804)            (3,959)
Equity income in unconsolidated affiliates                        3,831              2,880             6,653              4,443
Interest income from unconsolidated affiliates                        -                292                 -                689
Interest income - other                                             285                148               560                432
Other, net                                                          428               (373)              430               (512)
                                                         --------------------------------------------------------------------------
          Other income  (expense)                                   474              1,034            (3,161)             1,093
                                                         --------------------------------------------------------------------------
INCOME BEFORE MINORITY INTEREST                                  15,399             19,350            15,080             29,911
MINORITY INTEREST                                                  (154)              (196)             (151)              (302)
                                                         ==========================================================================
NET INCOME                                                   $   15,245         $   19,154        $   14,929         $   29,609
                                                         ==========================================================================
ALLOCATION OF NET INCOME TO:
          Limited partners                                   $   15,093         $   18,962        $   14,780         $   29,313
          General partner                                    $      152         $      192        $      149         $      296
                                                         ==========================================================================
NET INCOME PER UNIT                                          $     0.27         $     0.28        $     0.27         $     0.44
                                                         ==========================================================================
WEIGHTED-AVERAGE NUMBER OF UNITS
          OUTSTANDING                                            54,963             66,696            54,963             66,725
                                                         ==========================================================================
See Notes to Unaudited Consolidated Financial Statements
                                       2
PART 1. FINANCIAL INFORMATION (continued)
                    Item 1. FINANCIAL STATEMENTS (continued)

                        Enterprise Products Partners L.P.
                      Statements of Consolidated Cash Flows
                                   (Unaudited)
                             (Dollars in Thousands)
Six Months Ended
                                                                                   June 30,
                                                                             1998           1999
                                                                         -----------------------------
OPERATING ACTIVITIES
Net income                                                                   $14,929        $29,609
Adjustments to reconcile net income to cash flows provided by
      (used for) operating activities:
      Depreciation and amortization                                            9,403          9,790
      Equity in income of unconsolidated affiliates                           (6,653)        (4,443)
      Leases paid by EPCO                                                          -          5,278
      Minority interest                                                          151            302
      (Gain) loss on sale of assets                                             (252)           124
      Net effect of changes in operating accounts                            (36,667)       (26,417)
                                                                         -----------------------------
Operating activities cash flows                                              (19,089)        14,243
                                                                         -----------------------------
INVESTING ACTIVITIES
Capital expenditures                                                          (7,388)        (2,513)
Proceeds from sale of assets                                                   3,704              7
Collection of notes receivable from unconsolidated affiliates                      -          7,369
Unconsolidated affiliates:
      Investments in and advances to                                         (14,471)       (40,432)
      Distributions received                                                   4,891          3,991
                                                                         -----------------------------
Investing activities cash flows                                              (13,264)       (31,578)
                                                                         -----------------------------
FINANCING ACTIVITIES
Long-term debt borrowings                                                          -         85,000
Long-term debt repayments                                                    (12,174)       (30,000)
Net decrease in restricted cash                                               (1,212)             -
Cash dividends paid to partners                                                    -        (52,718)
Cash dividends paid to minority interest                                           -           (538)
Units acquired by consolidated trusts                                              -         (4,607)
Cash contributions from EPCO to minority interest                                  -             54
                                                                         -----------------------------
Financing activities cash flows                                              (13,386)        (2,809)
                                                                         -----------------------------
CASH CONTRIBUTIONS FROM (TO) EPCO                                             35,974              -
NET CHANGE IN CASH AND CASH EQUIVALENTS                                       (9,765)       (20,144)
CASH AND CASH EQUIVALENTS, JANUARY 1                                          18,941         24,103
                                                                          =============================
CASH AND CASH EQUIVALENTS , JUNE 30                                         $  9,176       $  3,959
                                                                         =============================
See Notes to Unaudited Consolidated Financial Statements
                                       3
Enterprise Products Partners L.P.
                   Notes to Consolidated Financial Statements
                                   (Unaudited)

1.   GENERAL

In the  opinion of  Enterprise  Products  Partners  L.P.  (the  "Company"),  the
accompanying unaudited consolidated financial statements include all adjustments
consisting of normal recurring accruals necessary for a fair presentation of the
Company's   consolidated  financial  position  as  of  June  30,  1999  and  its
consolidated  results of  operations  and cash flows for the three and six month
periods  ended  June 30,  1999 and  1998.  Although  the  Company  believes  the
disclosures in these  financial  statements are adequate to make the information
presented not misleading,  certain information and footnote disclosures normally
included in annual  financial  statements  prepared in accordance with generally
accepted  accounting  principles have been condensed or omitted  pursuant to the
rules and regulations of the Securities and Exchange Commission. These unaudited
financial statements should be read in conjunction with the financial statements
and notes thereto  included in the Company's  Annual Report on Form 10-K for the
year ended December 31, 1998 ("Form 10-K").

The results of  operations  for the three and six months ended June 30, 1999 are
not necessarily indicative of the results to be expected for the full year.

Dollar amounts presented in the tabulations within the notes to the consolidated
financial  statements  are stated in  thousands  of  dollars,  unless  otherwise
indicated.

2.   INVESTMENTS IN AND ADVANCES TO UNCONSOLIDATED AFFILIATES

At June 30, 1999, the Company's significant  unconsolidated affiliates accounted
for by the equity method included the following:

     Belvieu  Environmental  Fuels  ("BEF") - a 33-1/3%  economic  interest in a
     Methyl Tertiary Butyl Ether ("MTBE") production facility.

     Mont  Belvieu  Associates  ("MBA") - a 49%  economic  interest in an entity
     which owns a 50% interest in a NGL fractionation  facility.  See Note 7 for
     subsequent event.

     Entell NGL  Services,  LLC  ("Entell") - a 50%  economic  interest in a NGL
     transportation  and distribution  system located in Louisiana and southeast
     Texas.

     Baton Rouge  Fractionators LLC ("BRF") - a 27.5% economic interest in a NGL
     fractionation  facility which is scheduled to begin  production  during the
     third quarter of 1999.

     EPIK Terminalling L.P. and EPIK Gas Liquids, LLC (collectively, "EPIK") - a
     50%  aggregate  economic  interest in a  refrigerated  NGL marine  terminal
     loading facility which is under  construction and scheduled to become fully
     operational in the fourth quarter of 1999.

     Wilprise Pipeline  Company,  LLC ("Wilprise") - a 33-1/3% economic interest
     in a NGL pipeline  system that is scheduled to become fully  operational in
     the third  quarter of 1999 in  conjunction  with the startup of the BRF NGL
     fractionation facility.

The Company's  investments  in and advances to  unconsolidated  affiliates  also
includes Tri-States NGL Pipeline, LLC ("Tri-States").  The Tri-States investment
consists of a 16-2/3%  economic  interest in a NGL pipeline  system which became
operational on March 26, 1999.  This  investment is accounted for using the cost
method in accordance with generally accepted accounting principles.
                                       4
Other joint ventures  included  various  entities in the formation stage at June
30, 1999.

Investments in and advances to unconsolidated affiliates at:
December 31,      June 30,
                                                          1998            1999
                                                    ---------------------------------
BEF................................................   $  50,079         $  51,712
MBA................................................      12,551            14,373
BRF................................................      17,896            28,148
EPIK...............................................       5,667            11,773
Wilprise...........................................       4,873             7,540
Entell.............................................           -               773
Tri-States.........................................          55            14,794
Other..............................................           -             2,892
                                                    =================================
Total..............................................   $  91,121         $ 132,005
                                                    =================================
Equity in income of unconsolidated affiliates for the:
Three Months ended                Six Months ended
                                             June 30,                         June 30,
                                      1998             1999            1998             1999
                                 ------------------------------------------------------------------
BEF............................       $2,381           $1,936          $3,254           $2,237
MBA............................        1,494              424           3,443            1,184
BRF............................            -             (143)              -             (286)
EPIK...........................          (44)            (220)            (44)             177
Entell.........................            -              883               -            1,131
                                 ==================================================================
Total..........................       $3,831           $2,880          $6,653           $4,443
                                 ==================================================================
3.   SUPPLEMENTAL CASH FLOW DISCLOSURE

The net effect of changes in operating assets and liabilities is as follows:
Six Months Ended
                                                                     June 30,
                                                               1998            1999
                                                         ---------------------------------
(Increase) decrease in:
      Accounts receivable...............................      $ 4,805          $ (6,574)
      Inventories.......................................      (19,015)          (37,952)
      Prepaid and other current assets..................          425               970
      Other assets......................................         (906)                -
Increase (decrease) in:
      Accounts payable - trade..........................      (34,203)             (164)
      Accrued gas payable...............................       23,699            22,864
      Accrued expenses..................................       (4,849)           (1,949)
      Other current liabilities.........................       (6,623)           (3,612)
                                                         =================================
Net effect of changes in operating accounts                 $ (36,667)         $(26,417)
                                                         =================================
5
4.   RECENTLY ISSUED ACCOUNTING STANDARDS

On June 6, 1999,  the  Financial  Accounting  Standards  Board  ("FASB")  issued
Statement of Financial  Accounting  Standard  ("SFAS) No. 137,  "Accounting  for
Derivative Instruments and Hedging  Activities-Deferral of the Effective Date of
FASB Statement No. 133-an amendment of FASB Statement No. 133" which effectively
delays and amends the  application  of SFAS No. 133  "Accounting  for Derivative
Instruments  and Hedging  Activities"  for one year,  to fiscal years  beginning
after June 15, 2000. Management is currently studying both SFAS No. 137 and SFAS
No. 133 for possible impact on the consolidated financial statements.

On April 3, 1998, the American  Institute of Certified Public Accountants issued
Statement  of  Position  ("SOP")  98-5, "Reporting  on the  Costs  of  Start-Up
Activities."  For years  beginning  after  December 15, 1998, SOP 98-5 generally
requires that all start-up costs of a business activity be charged to expense as
incurred and any start-up costs  previously  deferred should be written off as a
cumulative  effect of a change in  accounting  principle.  Adoption  of SOP 98-5
during  1999  did not  have a  material  impact  on the  consolidated  financial
statements  except for a $4.5 million noncash write-off that occurred on January
1, 1999 of the unamortized  balance of deferred  start-up costs of BEF, in which
the  Company  owns a 33-1/3%  interest.  This  write-off  caused a $1.5  million
reduction in the equity in income of  unconsolidated  affiliates  for 1999 and a
corresponding   reduction  in  the  Company's   investment   in   unconsolidated
affiliates.

5.   CAPITAL STRUCTURE

At June 30, 1999, the Company had 33,552,915  Common Units  outstanding  held by
Enterprise  Products  Company  (the  Company's  ultimate  parent or "EPCO")  and
12,000,000  Common Units  outstanding  held by third  parties.  During the first
quarter of 1999, the Company established a revocable grantor trust (the "Trust")
to  fund  future  liabilities  of  a  Long-Term  Incentive  Plan  (the  "Plan").
Provisions  of the Plan were not  finalized  as of August 9,  1999.  At June 30,
1999,  the Trust had  purchased  a total of 267,200  Common  Units  (the  "Trust
Units") which are accounted for in a manner  similar to treasury stock under the
cost method of accounting.  The Trust Units are considered  outstanding and will
receive  distributions;  however,  they are excluded from the calculation of net
income per Unit in accordance with generally accepted accounting principles.

6.  DISTRIBUTIONS

On January 12, 1999, the Company  declared a quarterly  distribution of $.45 per
Unit for the fourth quarter of 1998,  which was paid on February 11, 1999 to all
Unitholders of record on January 29, 1999. The Company declared its distribution
for the first quarter of 1999 on April 16, 1999 in the amount of $.45 per Common
Unit.  The first  quarter 1999  distribution  was paid on May 12, 1999 to Common
Unitholders of record on April 30, 1999. The Company  declared a $.45 per Common
Unit  distribution  for the second  quarter of 1999 on July 16, 1999. The second
quarter 1999 distribution will be paid on August 11, 1999 to Common  Unitholders
of record on July 30, 1999.

7.   SUBSEQUENT EVENTS

Acquisition of Tejas Assets

On April 20, 1999, the Company and Tejas Energy, LLC ("Tejas"),  an affiliate of
Shell Oil Company ("Shell"), announced that they had agreed to general terms for
a business  combination  encompassing  the Company and a substantial  portion of
Tejas' natural gas liquids ("NGL")  business.  The agreed upon terms contemplate
Tejas  contributing  certain  NGL assets to the  Company  for which  Tejas would
receive  an  equity  interest  in  the  Company  and  other  consideration.  The
completion of this transaction  would form a business  combination  comprising a
fully  integrated  Gulf  Coast  NGL  processing,   fractionation,  storage,  and
transportation business. It would also establish an alliance between the Company
and Shell whereby the Company would have the rights to process  Shell's  current
and future Gulf of Mexico natural gas production and market the NGLs  recovered.
Any  transaction  resulting  from the agreed  upon terms would be subject to the
Company and Tejas successfully executing a definitive agreement;  satisfactorily
completing  their  respective  due  diligence   reviews;   receiving   requisite
regulatory  approvals  and  receiving  approvals  from each  company's  board of
directors.  The parties  anticipate  the closing of this  transaction  in August
1999.

                                       6
Purchase of Lou-Tex Pipeline

On July 27, 1999,  the Company  announced the execution of a letter of intent to
acquire a  Louisiana  and Texas  pipeline  asset from Concha  Chemical  Pipeline
Company ("Concha"), an affiliate of Shell Oil Company, for an undisclosed amount
of cash. The pipeline being acquired,  referred to as the Lou-Tex  pipeline,  is
263 miles of 10" pipeline from Sorrento,  Louisiana to Mont Belvieu,  Texas. The
Lou-Tex pipeline is currently  dedicated to the transportation of chemical grade
propylene from Sorrento to the Mont Belvieu area.  Enterprise plans to convert a
portion of the  Lou-Tex  pipeline  into batch  service.  In batch  service,  the
pipeline will be able to transport refinery and chemical grade propylene,  mixed
NGLs and NGL products:  ethane,  propane,  normal butane,  isobutane and natural
gasoline.  In  conjunction  with the  plans to  convert  the  pipeline  to batch
service, the capacity of the Lou-Tex pipeline will be increased to approximately
75,000  barrels  per  day.  The  acquisition  of the  Lou-Tex  pipeline  and its
conversion into batch service is the first step in the Company's  development of
a $245 million,  160,000 barrel per day gas liquids pipeline system. This larger
system will link growing  supplies of NGLs produced in Louisiana and Mississippi
with the principal NGL markets on the United States Gulf Coast.  The  completion
of  the  Lou-Tex  transaction  is  subject  to  the  successful  negotiation  of
definitive   agreements,   approval  of  those   agreements  by  the  respective
managements  and  regulatory  approvals.  This  transaction  is  expected  to be
completed  by the end of the third  quarter of 1999.  Conversion  of the Lou-Tex
system to batch  service with 75,000  barrels per day of capacity is expected in
the second half of 2000.

The Company  will  acquire the Lou-Tex  pipeline  asset  through its  affiliate,
Entell NGL Services,  LLC ("Entell").  Entell,  formed in early 1999, is a 50/50
joint  venture  between  the  Company and Tejas  Natural  Gas  Liquids,  LLC, an
affiliate of Shell Oil Company.  Upon completion of the previously announced NGL
alliance  between  Shell  Oil  Company  and  the  Company,   Entell  will  be  a
wholly-owned subsidiary of the Company.

Acquisition of Kinder Morgan interest in Fractionation facility

On July 28, 1999, the Company  announced that it had agreed to general terms and
conditions for the Company to purchase  Kinder Morgan Energy Partners L.P.'s 25%
indirect  ownership  interest  in a  210,000  barrel  per day NGL  fractionating
facility   located  in  Mont  Belvieu,   Texas  for  $41  million  in  cash  and
approximately  $4  million  in  debt   assumption.   In  conjunction  with  this
transaction,  the  Company  will  acquire  EPCO's  1%  interest  in  MBA  for an
undisclosed amount of cash. Upon completion of these transactions, the Company's
ownership interest in the Mont Belvieu fractionation facility will increase from
37.0% to 62.5%.  This  fractionator  is located in the  Company's  Mont  Belvieu
processing  complex.  The Company  serves as the operator of the  facility.  The
parties anticipate closing this transaction in August 1999.

New Bank Credit facility

Also on July 28,  1999,  Enterprise  Products  Operating  L.P.  (the  "Operating
Partnership") entered into a $350.0 million bank credit facility that includes a
$50.0 million working capital facility and a $300.0 million  revolving term loan
facility. The $300.0 million revolving term loan facility includes a sublimit of
$10.0  million  for  letters of credit.  The  proceeds of this loan will be used
principally for the acquisition of the Tejas assets,  the Lou-Tex pipeline,  and
Kinder Morgan's interest in the fractionation facility.

Borrowings  under the bank  credit  facility  will bear  interest  at either the
bank's prime rate or the Eurodollar  rate plus the applicable  margin as defined
in the  facility.  The bank credit  facility will expire after two years and all
amounts borrowed thereunder shall be due and payable on such date. There must be
no  amount  outstanding  under  the  working  capital  facility  for at least 15
consecutive days during each fiscal year.

The credit  agreement  relating to the new facility  contains a  prohibition  on
distributions  on, or purchases or  redemptions of Units if any event of default
is  continuing.   In  addition,   the  bank  credit  facility  contains  various
affirmative and negative covenants  applicable to the ability of the Company to,
among  other  things,  (i) incur  certain  additional  indebtedness,  (ii) grant
certain  liens,  (iii) sell assets in excess of certain  limitations,  (iv) make
investments,  (v) engage in  transactions  with affiliates and (vi) enter into a
merger, consolidation, or sale of assets. The bank credit facility requires that
the Operating  Partnership  satisfy the following financial covenants at the end
of each fiscal quarter: (i) maintain Consolidated Tangible Net Worth (as defined
in the bank credit facility) of at least $250,000,000,  (ii) maintain a ratio of
EBITDA (as defined in the bank credit facility) to Consolidated Interest Expense
(as defined in the bank credit facility) for the previous  12-month period of at
least 3.5 to 1.0 and (iii) maintain a ratio of Total Indebtedness (as defined in
the bank credit facility) to EBITDA of no more than 3.0 to 1.0.

                                       7
A "Change of  Control"  constitutes  an Event of Default  under the bank  credit
facility.  A Change of Control includes any of the following events:  (i) Dan L.
Duncan  (and  certain  affiliates)  cease  to own (a) at  least  51% (on a fully
converted, fully diluted basis) of the economic interest in the capital stock of
EPCO or (b) an aggregate number of shares of capital stock of EPCO sufficient to
elect a majority  of the board of  directors  of EPCO;  (ii) EPCO ceases to own,
through a wholly owned  subsidiary,  at least 65% of the outstanding  membership
interest  in the  General  Partner  and at least a majority  of the  outstanding
Common Units;  (iii) any person or group  beneficially owns more than 20% of the
outstanding  Common  Units;  (iv) the General  Partner  ceases to be the general
partner of the Company or the Operating  Partnership;  or (v) the Company ceases
to be the sole limited partner of the Operating Partnership.

                                       8
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                           AND RESULTS OF OPERATIONS.

              For the Interim Periods ended June 30, 1999 and 1998

     The following  discussion and analysis  should be read in conjunction  with
the unaudited  consolidated financial statements and notes thereto of Enterprise
Products  Partners  L.P.  ("Enterprise"  or the  "Company")  included  elsewhere
herein.

The Company

     The Company is a leading  integrated North American  provider of processing
and  transportation  services to domestic  and foreign  producers of natural gas
liquids  ("NGLs")  and  other  liquid  hydrocarbons  and  domestic  and  foreign
consumers of NGLs and liquid hydrocarbon  products.  The Company manages a fully
integrated and diversified  portfolio of midstream  energy assets and is engaged
in NGL processing and  transportation  through direct and indirect ownership and
operation  of NGL  fractionators.  It also  manages NGL  processing  facilities,
storage facilities,  pipelines, and rail transportation  facilities,  and methyl
tertiary  butyl ether  ("MTBE")  and  propylene  production  and  transportation
facilities in which it has a direct and indirect ownership.

     The Company is a publicly traded master limited  partnership (NYSE,  symbol
"EPD")  that  conducts  substantially  all of its  business  through  Enterprise
Products   Operating   L.P.  (the   "Operating   Partnership"),   the  Operating
Partnership's  subsidiaries,  and a  number  of  joint  ventures  with  industry
partners.  The Company was formed in April 1998 to acquire, own, and operate all
of the NGL processing and  distribution  assets of Enterprise  Products  Company
("EPCO").

     The principal executive office of the Company is located at 2727 North Loop
West,  Houston,  Texas,  77008-1038,  and the telephone number of that office is
713-880-6500.  References to, or  descriptions  of, assets and operations of the
Company in this  quarterly  report  include  the assets  and  operations  of the
Operating  Partnership and its  subsidiaries as well as the  predecessors of the
Company.

General

     The Company (i)  fractionates  for a processing  fee mixed NGLs produced as
by-products of oil and natural gas  production  into their  component  products:
ethane,  propane,  isobutane,  normal butane and natural gasoline; (ii) converts
normal butane to isobutane through the process of isomerization;  (iii) produces
MTBE from isobutane and methanol;  and (iv) transports NGL products to end users
by pipeline and railcar.  The Company also separates high purity  propylene from
refinery-sourced  propane/propylene  mix and transports high purity propylene to
plastics manufacturers by pipeline.  Products processed by the Company generally
are used as  feedstocks in  petrochemical  manufacturing,  in the  production of
motor gasoline and as fuel for residential and commercial heating.

     The  Company's  processing  operations  are  concentrated  in Mont Belvieu,
Texas,  which is the hub of the  domestic  NGL  industry  and is adjacent to the
largest  concentration  of  refineries  and  petrochemical  plants in the United
States. The facilities operated by the Company at Mont Belvieu include:  (i) one
of the largest NGL fractionation facilities in the United States with an average
production  capacity  of  210,000  barrels  per  day;  (ii) the  largest  butane
isomerization  complex in the United States with an average isobutane production
capacity of 116,000  barrels per day;  (iii) one of the largest MTBE  production
facilities  in the United States with an average  production  capacity of 14,800
barrels  per day;  and (iv) two  propylene  fractionation  units with an average
combined  production capacity of 31,000 barrels per day. The Company owns all of
the  assets  at its  Mont  Belvieu  facility  except  for the NGL  fractionation
facility,  in  which  it owns an  effective  37.0%  economic  interest  (see NGL
Fractionation below); one of the propylene fractionation units, in which it owns
a 54.6% interest and controls the remaining  interest through a long-term lease;
the MTBE production  facility,  in which it owns a 33-1/3% interest;  and one of
its three  isomerization  units  and one  deisobutanizer  which  are held  under
long-term  leases with  purchase  options.  The Company  also owns and  operates
approximately  35 million  barrels  of  storage  capacity  at Mont  Belvieu  and
elsewhere that are an integral part of its processing  operations,  a network of
approximately   500  miles  of  pipelines   along  the  Gulf  Coast  and  a  NGL
fractionation facility in Petal, Mississippi with an average production capacity
of 7,000  barrels per day.  The Company also leases and operates one of only two
commercial NGL import/export terminals on the Gulf Coast.

                                       9
Industry Environment

     Because certain NGL products compete with other refined petroleum  products
in the fuel and petrochemical  feedstock markets,  NGL product prices are set by
or in competition  with refined  petroleum  products.  Increased  production and
importation  of NGLs and NGL  products  in the United  States may  decrease  NGL
product  prices in  relation  to  refined  petroleum  alternatives  and  thereby
increase  consumption of NGL products as NGL products are  substituted for other
more  expensive  refined  petroleum  products.  Conversely,  a  decrease  in the
production  and  importation of NGLs and NGL products could increase NGL product
prices in  relation to refined  petroleum  product  prices and thereby  decrease
consumption  of NGLs.  However,  because  of the  relationship  of crude oil and
natural gas production to NGL production,  the Company believes any imbalance in
the prices of NGLs and NGL products and alternative products would be temporary.

     Historically,  when the price of crude oil is a multiple  of ten or more to
the price of natural gas (i.e.,  crude oil $20 per barrel and natural gas $2 per
thousand cubic feet  ("MCF")),  NGL pricing has been strong due to increased use
in manufacturing petrochemicals. In 1998, the industry experienced an annualized
multiple of approximately six (i.e., crude oil $12 per barrel and natural gas $2
per MCF),  which  caused  petrochemical  manufacturing  demand  to  change  from
reliance on NGLs to a preference for crude oil derivatives. This change resulted
in the lowering of both the production and pricing of NGLs. In the NGL industry,
revenues and cost of goods sold can fluctuate  significantly up or down based on
current NGL prices.  However,  operating  margins will generally remain constant
except for the effect of inventory  price  adjustments  or  increased  operating
expenses.

         NGL Fractionation

     The profitability of this business unit depends on the volume of mixed NGLs
that  the  Company  processes  for its  toll  customers  and the  level  of toll
processing fees charged to its customers.  The most significant variable cost of
fractionation  is the cost of energy  required  to operate the units and to heat
the mixed NGLs to effect separation of the NGL products.  The Company is able to
reduce  its  energy  costs  by  capturing  excess  heat and  re-using  it in its
operations.  Additionally,  the Company's NGL fractionation processing contracts
typically  contain  escalation  provisions  for cost  increases  resulting  from
increased variable costs,  including energy costs. The Company's interest in the
operations of its NGL  fractionation  facilities  at Mont Belvieu  consists of a
directly-owned  12.5% undivided  interest and a 49.0% economic  interest in MBA,
which in turn owns a 50.0% undivided interest in such facilities.  The Company's
12.5%  interest is recorded as part of revenues and expenses,  and its effective
24.5% economic interest is recorded as an equity investment in an unconsolidated
subsidiary.

     On July 28, 1999, the Company announced that it had agreed to general terms
and  conditions  for the purchase of Kinder  Morgan Energy  Partners  L.P.'s 50%
economic interest in MBA for $41 million in cash and approximately $4 million in
debt assumption. In conjunction with this transaction,  the Company will acquire
EPCO's 1% interest in MBA for an undisclosed  amount of cash. Upon completion of
this  transaction,   the  Company's  ownership  interest  in  the  Mont  Belvieu
fractionation facility will increase from 37.0% to 62.5%. The parties anticipate
closing this transaction in August 1999.

         Isomerization

     The  profitability  of this  business  unit depends on the volume of normal
butane that the Company isomerizes (i.e.,  converts) into isobutane for its toll
processing  customers,  the  level  of  toll  processing  fees  charged  to  its
customers,  and  the  margins  generated  from  selling  isobutane  to  merchant
customers.  The Company's  toll  processing  customers pay the Company a fee for
isomerizing their normal butane into isobutane.  In addition,  the Company sells
isobutane  that  it  obtains  by  isomerizing   normal  butane  into  isobutane,
fractionating  mixed butane into  isobutane  and normal  butane,  or  purchasing
isobutane in the spot market.  The Company  determines  the optimal  sources for
isobutane to meet sales  obligations based on current and expected market prices
for isobutane and normal butane, volumes of mixed butane held in inventory,  and
estimated costs of isomerization and mixed butane fractionation.

                                       10
The Company purchases most of its imported mixed butanes between the months
of February and October.  During these  months,  the Company is able to purchase
imported  mixed  butanes at prices that are often at a discount to posted market
prices.  Because of its  storage  capacity,  the  Company is able to store these
imports  until the summer  months when the spread  between  isobutane and normal
butane  typically widens or until winter months when the prices of isobutane and
normal butane typically rise. As a result,  inventory investment is generally at
its  highest  level at the end of the third  quarter  of the year.  Should  this
spread  not  materialize,  or in the  event  absolute  prices  decline,  margins
generated  from  selling  isobutane  to  merchant  customers  may be  negatively
affected.

         Propylene Fractionation

     The  profitability  of  this  business  unit  depends  on  the  volumes  of
refinery-sourced  propane/propylene  mix that the Company processes for its toll
customers,  the level of toll  processing  fees charged to its customers and the
margins  associated  with  buying  refinery-sourced  propane/propylene  mix  and
selling  high  purity   propylene  to  meet  sales  contracts  with  non-tolling
customers.

         Pipelines

     The  Company  operates  both  interstate  and  intrastate  NGL  product and
propylene pipelines.  The Company's interstate pipelines are common carriers and
must  provide  service to any shipper who  requests  transportation  services at
rates regulated by the Federal Energy Regulatory Commission ("FERC"). One of the
Company's  intrastate  pipelines is a common  carrier  regulated by the State of
Louisiana.  The  profitability  of this business unit is primarily  dependent on
pipeline throughput volumes.

         Unconsolidated Affiliates

     At June 30, 1999, the Company's significant  unconsolidated affiliates were
BEF,  MBA,  EPIK,  BRF,  Tri-States,  Wilprise,  and  Entell.  BEF owns the MTBE
production  facility  operated by the Company at its Mont Belvieu  complex.  MBA
owns a 50%  interest  in a NGL  fractionation  facility  at the  Company's  Mont
Belvieu  complex.  EPIK owns a refrigerated NGL marine terminal loading facility
located on the Houston ship channel.  An expansion of EPIK's NGL marine terminal
loading  facility is under way and is  scheduled  for  completion  in the fourth
quarter  of 1999.  BRF owns a NGL  fractionation  facility  in  Louisiana.  This
facility is expected to begin  operations in August 1999.  Tri-States owns a NGL
pipeline in  Louisiana,  Mississippi,  and Alabama which became  operational  in
March 1999.  Wilprise owns a NGL pipeline in Louisiana.  Management  anticipates
that the Wilprise pipeline will become fully operational in the third quarter of
1999 in conjunction with the startup of the BRF fractionation facility.

Results of Operations

     The  Company's  operating  margins by  business  unit for the three and six
month periods ended June 30, 1998 and 1999 were as follows:
Three Months Ended            Six Months Ended
                                                           June 30,                     June 30,
                                                      1998          1999          1998           1999
                                                 ----------------------------------------------------------
Operating Margin:
      NGL Fractionation.........................      $   697       $   726       $ 1,544       $ 1,532
      Isomerization.............................       10,808        12,359        13,462        17,996
      Propylene Fractionation...................        2,454         6,354         4,466        11,440
      Pipeline .................................        3,772         1,621         7,047         3,715
      Storage and Other Plants..................        3,051           256         3,339           135
                                                 ==========================================================
Total                                                 $20,782       $21,316       $29,858       $34,818
                                                 ==========================================================
11
The Company's  plant  production data (in thousands of barrels per day) for
the three and six month periods ended June 30, 1998 and 1999 were as follows:
Three Months Ended            Six Months Ended
                                                           June 30,                     June 30,
                                                      1998          1999          1998           1999
                                                 ----------------------------------------------------------
Plant Production Data:
      NGL Fractionation                               205           166           206            158
      Isomerization                                    67            74            65             71
      MTBE                                             14            15            12             13
      Propylene Fractionation                          27            31            26             27
The Company's equity in income of unconsolidated  affiliates (in thousands)
for the  three  and six  month  periods  ended  June 30,  1998 and 1999  were as
follows:
Three Months ended                Six Months ended
                                             June 30,                         June 30,
                                      1998             1999            1998             1999
                                 ------------------------------------------------------------------
BEF                                    $2,381           $1,936          $3,254           $2,237
MBA                                     1,494              424           3,443            1,184
BRF                                         -             (143)              -             (286)
EPIK                                      (44)            (220)            (44)             177
Entell                                      -              883               -            1,131
                                 ==================================================================
Total                                  $3,831           $2,880          $6,653           $4,443
                                 ==================================================================
Three Months Ended June 30, 1999 Compared with Three Months Ended June 30, 1998

     Revenues; Costs and Expenses

     The Company's  revenues decreased by 16% to $174.6 million in 1999 compared
to $207.6 million in 1998. The Company's costs and expenses  decreased by 18% to
$153.3 million in 1999 compared to $186.8 million in 1998.  Revenues and cost of
goods sold for the second  quarter of 1998 were $32.4 million higher than in the
second  quarter of 1999 due to higher  than  normal  sales of normal  butane and
contained propylene  inventories.  Excess inventory volumes of these commodities
were sold in  anticipation  of  forecasted  declines in NGL  prices.  In the NGL
industry,  revenues and costs and expenses can fluctuate  significantly based on
the level of NGL prices without necessarily  affecting margin.  Operating margin
increased by 2% to $21.3 million in 1999 compared to $20.8 million in 1998.

     NGL  Fractionation..  The Company's  operating margin for NGL fractionation
was $0.7 million for both 1999 and 1998.  Excluding the positive  effect of $0.5
million in overhead expenses and support facility cost reimbursements from joint
venture  partners in 1999,  the Company's  NGL  fractionation  operating  margin
decreased  71% to $0.2 million in 1999 from $0.7 million in 1998.  Average daily
fractionation  volumes  decreased from 205 MBPD ("thousands of barrels per day")
in 1998 to 166 MBPD in 1999. The lower  fractionation  rates are attributable to
decreased  volumes from joint owners and third party  customers  stemming partly
from  reduced  drilling  activity  (and  thus  natural  gas  production)  in the
producing  regions  brought  on by a  decrease  in oil  and gas  prices  and the
short-term  diversion of customer  volumes to a  competitor.  The Company  fully
expects  that the  diverted  volumes will be recovered in the next six to twelve
months.

     Isomerization.  The Company's operating margin for isomerization  increased
15% to $12.4  million  in 1999  compared  to $10.8  million  in 1998.  Isobutane
volumes  from  tolling and merchant  activities  for the second  quarter of 1999
averaged  107 MBPD as  compared  to 106 MBPD for the same  period  in 1998.  The
operating  margin for 1999 included a $0.7 million benefit from the amortization
of the  deferred  gain  associated  with the sale  and  leaseback  of one of the
Company's  isomerization units. Excluding this benefit, the operating margin for
1999 would have been $11.7 million as compared to $10.8 million in 1998.

                                       12
Average daily toll  processing  volumes were 58 MBPD in 1999 compared to 56
MBPD in 1998.  Isobutane volumes related to merchant  activities were 49 MBPD in
1999 and 1998.  Isobutane  volumes were slightly higher in the second quarter of
1999  compared to second  quarter of 1998 due to  increased  export  volumes and
higher isobutane prices.

     Propylene  Fractionation.  The Company's operating margin increased 156% to
$6.4 million in 1999 from $2.5 million in 1998.  Propylene production during the
second  quarter  averaged 31 MBPD in 1999 as  compared  to 27 MBPD in 1998.  The
earnings  improvement  was primarily  attributable  to the Company's  actions to
maximize  earnings while  minimizing  price risk in the merchant portion of this
business by matching the volume,  timing and price of feedstock  purchases  with
sales of the product.  Earnings  also  benefited  from an increase in production
volumes  associated  with spot business  caused by increased  demand for polymer
grade propylene.

     Pipeline.  The Company's operating margin from pipeline operations was $1.6
million in 1999  compared  to $3.8  million in 1998.  The  decrease  in Pipeline
margin for the quarter was primarily  attributable to the Company's contribution
of certain  wholly-owned  pipeline assets, in the first quarter of 1999, and its
export  loading  facility,  in June 1998, to joint ventures in which the Company
owns a 50% interest.  As a result, the earnings from these assets since the time
of  their  contribution  are  included  in  equity  income  from  unconsolidated
affiliates  as  prescribed  by the equity  method of  accounting  rather than in
earnings  from  consolidated  Pipeline  operations.  This  change in  accounting
treatment  accounts for approximately  $1.9 million of the decrease.  Throughput
for the second quarter of 1999 averaged 189 MBPD as compared to 220 MBPD for the
same period in 1998.

     Selling, General and Administrative Expenses

     Selling, general and administrative expenses decreased $2.9 million to $3.0
million in 1999 from $5.9 million in 1998.  This  decrease was  primarily due to
the  adoption  of the  EPCO  Agreement  in July  1998 in  conjunction  with  the
Company's  initial public  offering  ("IPO") which fixed  reimbursable  selling,
general,  and  administrative  expenses at an initial amount of $1.0 million per
month.

     Interest Expense

     Interest  expense for the second  quarter was $1.9 million in 1999 and $4.1
million in 1998.  This  decrease  was  principally  due to the reduced  level of
average debt  outstanding  during the first quarter of 1999  attributable to the
retirement of debt in July 1998 using proceeds from the Company's IPO.

     Equity Income in Unconsolidated Affiliates

     Equity  income  in  unconsolidated  affiliates  was  $2.9  million  in 1999
compared to $3.8 million in 1998. Equity income from BEF decreased 21% from $2.4
million in 1998 to $1.9  million  in 1999.  Equity  income  from BEF in 1999 was
affected by  contractual  spot sales of MTBE in April 1999 and May 1999 . Equity
income from MBA  decreased 73% to $0.4 million in 1999 from $1.5 million in 1998
due to decreased  throughput from joint owners and third party customers.  Among
the Company's new projects, equity income from Entell was $0.9 million with EPIK
showing a loss of $0.2  million.  Equity  income from EPIK is seasonal  based on
export needs which are at a peak during the  September to February  time period.
BRF,  which is  still in the  development  stage,  showed a slight  loss of $0.1
million.

                                       13
Six Months Ended June 30, 1999 Compared with Six Months Ended June 30, 1998

Revenues; Costs and Expenses

     The Company's  revenues decreased by 19% to $321.9 million in 1999 compared
to $398.1 million in 1998. The Company's costs and expenses  decreased by 22% to
$287.1  million in 1999  compared to $368.2  million in 1998.  Both revenues and
cost of  goods  sold  decreased  from  1998 to 1999 due to  merchant  activities
associated with reductions of excess inventories in 1998 and declines in average
NGL prices.  Operating margin increased by 16% to $34.8 million in 1999 compared
to $29.9 million in 1998.

     NGL Fractionation. The Company's operating margin for NGL fractionation was
$1.5  million  for both 1999 and 1998.  Excluding  the  positive  effect of $1.1
million in overhead expenses and support facility cost reimbursements from joint
venture  partners in 1999,  the Company's  NGL  fractionation  operating  margin
decreased  73% to $0.4 million in 1999 from $1.5 million in 1998.  Average daily
fractionation  volumes  decreased  from  201  MBPD in 1998 to 180  MBPD in 1999.
Fractionation  volumes are lower in 1999 as compared  to 1998 due  primarily  to
ethane rejection,  downtime associated with preventative maintenance activities,
lower natural gas  production  caused by depressed  oil and gas prices,  and the
short-term  diversion  of  customer  volumes to a  competitor.  During the first
quarter  of 1999,  natural  gas prices  remained  higher  than the  energy  unit
equivalent of ethane; therefore, upstream natural gas processing plants rejected
ethane  which  reduced  the  volumes   delivered  to  Company   facilities   for
fractionation services. The Company took advantage of the reduced demand for its
fractionation  services  during the first  quarter  of 1999 to  perform  certain
preventative  maintenance procedures on one of its fractionation facilities that
are generally  required  every two to three years.  During the second quarter of
1999,  volumes were reduced due to the short-term  diversion of customer volumes
to a competitor.  Management  expects that these volumes will be fully recovered
in the next six to twelve months.

     Isomerization.  The Company's operating margin for isomerization  increased
33% to $18.0  million  in 1999  compared  to $13.5  million  in 1998.  Isobutane
volumes  from  tolling and  merchant  activities  for 1999  averaged 101 MBPD as
compared to 99 MBPD for the same period in 1998.  The operating  margin for 1999
included a $1.3 million  benefit  from the  amortization  of the  deferred  gain
associated  with the sale and  leaseback of one of the  Company's  isomerization
units.  Excluding  this benefit,  the operating  margin for 1999 would have been
$16.7 million as compared to $13.5 million in 1998.

     Average daily toll processing volumes were 57 MBPD in 1999, or 80% of total
volumes produced, compared to 55 MBPD in 1998, or 85% of total volumes produced.
Isobutane volumes related to merchant  activities were 44 MBPD in 1999 and 1998.
Isobutane  volumes are higher in 1999  compared to 1998 due to increased  export
volumes and higher isobutane prices.

     Propylene  Fractionation.  The Company's operating margin increased 153% to
$11.4 million in 1999 from $4.5 million in 1998.  Propylene  production averaged
27 MBPD in 1999 as compared to 26 MBPD in 1998.  The  earnings  improvement  was
primarily attributable to the Company's actions to minimize risk in the merchant
portion of this  business by matching the volume,  timing and price of feedstock
purchases with sales of end products.  The operating  margin also benefited from
an  increase in  production  volumes  associated  with spot  business  caused by
increased demand for polymer grade propylene.

     Pipeline.  The Company's operating margin from pipeline operations was $3.7
million in 1999 compared to $7.0 million in 1998.  Throughput  for 1999 averaged
180 MBPD as compared to 201 MBPD for the same  period in 1998.  The  decrease in
throughput  was  primarily  attributable  to a decrease in import  volumes.  The
decrease in Pipeline margin is principally related to the Company's contribution
of certain  wholly-owned  pipeline assets, in the first quarter of 1999, and its
export  loading  facility,  in June 1998 to joint  ventures in which the Company
owns a 50% interest.  As a result, the earnings from these assets since the time
of  their  contribution  are  included  in  equity  income  from  unconsolidated
affiliates  as  prescribed  by the equity  method of  accounting  rather than in
earnings  from  consolidated  pipeline  operations.  This  change in  accounting
treatment accounts for $2.8 million of the decrease.

                                       14
Selling, General and Administrative Expenses

     Selling, general and administrative expenses decreased $5.6 million to $6.0
million in 1999 from $11.6  million in 1998.  This decrease was primarily due to
the  adoption  of the  EPCO  Agreement  in July  1998 in  conjunction  with  the
Company's  initial public  offering  ("IPO") which fixed  reimbursable  selling,
general, and administrative expenses at $1.0 million per month.

     On July 7, 1999, the Audit and Conflicts  Committee of Enterprise  Products
GP, LLC (the  general  partner of the  Company)  authorized  an  increase in the
administrative  services  fee to $1.1 million per month in  accordance  with the
EPCO Agreement. The increased fees are effective August 1, 1999.

     Interest Expense

     Interest  expense was $4.0 million in 1999 and $10.8 million in 1998.  This
decrease was  principally  due to the reduced level of average debt  outstanding
during the first quarter of 1999  attributable to the retirement of debt in July
1998 using proceeds from the Company's IPO.

     Equity Income in Unconsolidated Affiliates

     Equity  income  in  unconsolidated  affiliates  was  $4.4  million  in 1999
compared to $26.7  million in 1998.  Equity  income from BEF  decreased 33% from
$3.3  million in 1998 to $2.2 million in 1999.  Equity  income from BEF for both
periods was  affected by  required  annual  maintenance  on the  Company's  MTBE
facility that generally takes the unit out of production for approximately three
weeks.  Equity income from BEF during 1999 also includes a $1.5 million non-cash
charge for the cumulative effect of a change in accounting  principal related to
the write-off of deferred  start-up  costs as  prescribed by generally  accepted
accounting  principles.  Equity income from MBA decreased 65% to $1.2 million in
1999 from $3.4 million in 1998 due primarily to decreased  throughput  caused by
ethane  rejection  and  downtime   associated  with   preventative   maintenance
activities.  Among the Company's new projects,  equity income from EPIK was $0.2
million  and Entell was $1.1  million.  BRF,  which is still in the  development
stage, showed a slight loss of $0.3 million.

Financial Condition and Liquidity

General

     The Company's  primary cash  requirements,  in addition to normal operating
expenses, are debt service, maintenance capital expenditures,  expansion capital
expenditures,  and quarterly  distributions to the partners. The Company expects
to fund future cash distributions and maintenance capital expenditures with cash
flows from operating  activities.  Expansion  capital  expenditures  for current
projects are expected to be funded with working capital and borrowings under the
revolving bank credit facility  described below while capital  expenditures  for
future  expansion  activities  are  expected  to be funded  with cash flows from
operating activities and borrowings under the revolving bank credit facility.

     Cash flows from  operating  activities  were a $14.2 million inflow for the
first six months of 1999 compared to a $19.1 million  outflow for the comparable
period of 1998.  Cash flows from  operating  activities  primarily  reflect  the
effects of net  income,  depreciation  and  amortization,  extraordinary  items,
equity  income of  unconsolidated  affiliates  and  changes in working  capital.
Depreciation and  amortization  increased by $0.4 million in 1999 as a result of
additional capital expenditures. The net effect of changes in operating accounts
from year to year is generally  the result of timing of NGL sales and  purchases
near the end of the period.

                                       15
Cash  outflows  from  investing  activities  were $31.6 million in 1999 and
$13.3 million for the comparable  period of 1998. Cash outflows included capital
expenditures of $2.5 million for 1999 and $7.4 million for 1998. Included in the
capital  expenditures  amounts  are  maintenance  capital  expenditures  of $0.7
million for 1999 and $3.5 million for 1998. Investing cash outflows in 1999 also
included  $40.4  million  in  advances  to  and  investments  in  unconsolidated
affiliates  versus $14.5 million for the  comparable  period of 1998.  The $25.9
million  increase  stems  primarily  from  contributions  made to the  Wilprise,
Tri-States,  and BRF joint  ventures  located in  Louisiana.  Also,  the Company
received $7.4 million in payments on notes receivable from the BEF and MBA notes
purchased during 1998 with the proceeds of the Company's IPO.

     Cash flows from financing  activities  were a $2.8 million  outflow in 1999
versus a $13.4 million  outflow for the  comparable  period of 1998.  Cash flows
from  financing  activities  are affected  primarily by  repayments of long-term
debt,  borrowings  under the long-term debt agreements and  distributions to the
partners.  Cash flows from  financing  activities  for 1999 also  reflected  the
purchase of $4.6 million of Common Units by a consolidated trust.

     Future Capital Expenditures

     The Company  currently  estimates that its share of remaining  expenditures
for  significant  capital  projects in fiscal 1999 will be  approximately  $14.8
million. These expenditures relate to the construction of joint venture projects
which will be recorded as additional  investments in unconsolidated  affiliates.
The Company  forecasts that an additional  $6.7 million will be spent in 1999 on
capital projects that will be recorded as property,  plant,  and equipment.  The
Company  expects to finance these  expenditures  out of operating cash flows and
borrowings  under its bank credit  facilities.  As of June 30, 1999, the Company
had $8.7 million in outstanding purchase commitments attributable to its capital
projects.  Of this amount,  $6.1 million is associated with significant  capital
projects  which will be recorded as  additional  investments  in  unconsolidated
affiliates for accounting purposes.

     Distributions from Unconsolidated Affiliates; Loan Participations

     Distributions  to the Company  from MBA were $1.1  million in 1999 and $1.2
million in 1998.  Distributions  from BEF in 1999 were $0.3 million  versus $1.4
million in 1998.  Prior to the first quarter of 1998, BEF was  prohibited  under
the terms of its bank indebtedness from making  distributions to its owners. The
restrictions  lapsed  during the first quarter of 1998 as a result of BEF having
repaid 50% of the principal on such indebtedness, with the Company receiving its
first  distribution from BEF in April 1998. The April 1998 distribution from BEF
included a special  one-time  disbursement of $1.5 million in debt reserve funds
allowed by its lenders.  Distributions from EPIK in 1999 were $1.1 million. EPIK
was formed in the  second  quarter  of 1998 and had no  distributions  until the
third quarter of 1998.

     In  connection   with  the  IPO  in  July  1998,   the  Company   purchased
participation  interests  in a bank  loan  to MBA and a bank  loan  to BEF.  The
Company acquired an approximate $7.7 million participation  interest in the bank
debt of MBA,  which bears  interest  at a floating  rate per annum of LIBOR plus
0.75% and  matures on  December  31,  2001.  The  Company is  receiving  monthly
principal  payments,  aggregating  approximately  $1.7  million  per year,  plus
interest from MBA during the term of the loan.  The Company will receive a final
payment of principal  and interest of $1.8  million upon  maturity.  The Company
acquired an approximate $26.1 million  participation  interest in a bank loan to
BEF,  which  bears  interest  at a floating  rate per annum at either the bank's
prime  rate,  CD rate,  or the  Eurodollar  rate plus the  applicable  margin as
defined in the facility  and matures on May 31,  2000.  The Company is receiving
quarterly  principal  payments of approximately  $3.3 million plus interest from
BEF during the term of the loan.

Bank Credit Facility

     Existing Bank Credit facility.  In July 1998, Enterprise Products Operating
L.P. (the  "Operating  Partnership")  entered into a $200.0  million bank credit
facility  that includes a $50.0 million  working  capital  facility and a $150.0
million  revolving  term loan facility.  The $150.0 million  revolving term loan
facility  includes a sublimit of $30.0 million for letters of credit. As of June
30,  1999,  the  Company  has  borrowed  $145.0  million  under the bank  credit
facility.

                                       16
The  Company's  obligations  under the bank credit  facility are  unsecured
general  obligations  and are  non-recourse to the General  Partner.  Borrowings
under the bank credit  facility  will bear  interest at either the bank's  prime
rate or the  Eurodollar  rate  plus the  applicable  margin  as  defined  in the
facility.  The bank credit  facility will expire after two years and all amounts
borrowed  thereunder  shall be due and  payable on such  date.  There must be no
amount   outstanding  under  the  working  capital  facility  for  at  least  15
consecutive days during each fiscal year.

     The credit  agreement  relating to the facility  contains a prohibition  on
distributions  on, or purchases or redemptions of, Units if any event of default
is  continuing.   In  addition,   the  bank  credit  facility  contains  various
affirmative and negative covenants  applicable to the ability of the Company to,
among  other  things,  (i) incur  certain  additional  indebtedness,  (ii) grant
certain  liens,  (iii) sell assets in excess of certain  limitations,  (iv) make
investments,  (v) engage in  transactions  with affiliates and (vi) enter into a
merger,  consolidation or sale of assets. The bank credit facility requires that
the Operating  Partnership  satisfy the following financial covenants at the end
of each fiscal quarter: (i) maintain Consolidated Tangible Net Worth (as defined
in the bank credit facility) of at least  $257,000,000  plus 75% of the net cash
proceeds from the sale of equity  securities of the Company that are contributed
to the Operating Partnership, (ii) maintain a ratio of EBITDA (as defined in the
bank credit  facility) to Consolidated  Interest Expense (as defined in the bank
credit  facility) for the previous  12-month  period of at least 3.50 to 1.0 and
(iii)  maintain a ratio of Total  Indebtedness  (as  defined in the bank  credit
facility) to EBITDA of no more than 2.25 to 1.0.

     A "Change of Control" constitutes an Event of Default under the bank credit
facility.  A Change of Control includes any of the following events:  (i) Dan L.
Duncan  (and  certain  affiliates)  cease  to own (a) at  least  51% (on a fully
converted, fully diluted basis) of the economic interest in the capital stock of
EPCO or (b) an aggregate number of shares of capital stock of EPCO sufficient to
elect a majority  of the board of  directors  of EPCO;  (ii) EPCO ceases to own,
through a wholly owned  subsidiary,  at least 95% of the outstanding  membership
interest  in the  General  Partner  and at least 51% of the  outstanding  Common
Units;  (iii)  any  person  or  group  beneficially  owns  more  than 20% of the
outstanding  Common  Units;  (iv) the General  Partner  ceases to be the general
partner of the Company or the Operating  Partnership;  or (v) the Company ceases
to be the sole limited partner of the Operating Partnership.

     New Bank Credit facility.  On July  28,  1999,  the  Operating  Partnership
entered into a $350.0 million bank credit facility that includes a $50.0 million
working capital facility and a $300.0 million revolving term loan facility.  The
$300.0 million revolving term loan facility includes a sublimit of $10.0 million
for letters of credit.  The proceeds of this loan will be used  principally  for
the acquisition of the Tejas assets,  the Lou-Tex pipeline,  and Kinder Morgan's
interest in the fractionation facility.

     Borrowings  under the bank credit facility will bear interest at either the
bank's prime rate or the Eurodollar  rate plus the applicable  margin as defined
in the  facility.  The bank credit  facility will expire after two years and all
amounts borrowed thereunder shall be due and payable on such date. There must be
no  amount  outstanding  under  the  working  capital  facility  for at least 15
consecutive days during each fiscal year.

     The credit agreement relating to the new facility contains a prohibition on
distributions  on, or purchases or  redemptions of Units if any event of default
is  continuing.   In  addition,   the  bank  credit  facility  contains  various
affirmative and negative covenants  applicable to the ability of the Company to,
among  other  things,  (i) incur  certain  additional  indebtedness,  (ii) grant
certain  liens,  (iii) sell assets in excess of certain  limitations,  (iv) make
investments,  (v) engage in  transactions  with affiliates and (vi) enter into a
merger, consolidation, or sale of assets. The bank credit facility requires that
the Operating  Partnership  satisfy the following financial covenants at the end
of each fiscal quarter: (i) maintain Consolidated Tangible Net Worth (as defined
in the bank credit facility) of at least $250,000,000,  (ii) maintain a ratio of
EBITDA (as defined in the bank credit facility) to Consolidated Interest Expense
(as defined in the bank credit facility) for the previous  12-month period of at
least 3.5 to 1.0 and (iii) maintain a ratio of Total Indebtedness (as defined in
the bank credit facility) to EBITDA of no more than 3.0 to 1.0.

     A "Change of Control" constitutes an Event of Default under the bank credit
facility.  A Change of Control includes any of the following events:  (i) Dan L.
Duncan  (and  certain  affiliates)  cease  to own (a) at  least  51% (on a fully
converted, fully diluted basis) of the economic interest in the capital stock of
EPCO or (b) an aggregate number of shares of capital stock of EPCO sufficient to
elect a majority  of the board of  directors  of EPCO;  (ii) EPCO ceases to own,
through a wholly owned  subsidiary,  at least 65% of the outstanding  membership
interest  in the  General  Partner  and at least a majority  of the  outstanding
Common Units;  (iii) any person or group  beneficially owns more than 20% of the
outstanding  Common  Units;  (iv) the General  Partner  ceases to be the general
partner of the Company or the Operating  Partnership;  or (v) the Company ceases
to be the sole limited partner of the Operating Partnership.

                                       17
MTBE Production

     The Company owns a 33-1/3%  economic  interest in the BEF partnership  that
owns the MTBE  production  facility  located  within the Company's  Mont Belvieu
complex.  The production of MTBE is driven by oxygenated  fuels programs enacted
under the federal Clean Air Act  Amendments of 1990 and other  legislation.  Any
changes to these programs that enable  localities to opt out of these  programs,
lessen the requirements  for oxygenates or favor the use of non-isobutane  based
oxygenated  fuels reduce the demand for MTBE and could have an adverse effect on
the Company's results of operations.

     On March 25, 1999, the Governor of California ordered the phase-out of MTBE
in that state by the end of 2002 due to allegations  by several public  advocacy
and protest groups that MTBE contaminates water supplies, causes health problems
and  has not  been  as  beneficial  in  reducing  air  pollution  as  originally
contemplated.  The  order  also  seeks  to  obtain  a  waiver  of the  oxygenate
requirement from the federal Environmental Protection Agency ("EPA") in order to
facilitate  the phase-out.  In addition,  legislation to amend the federal Clean
Air Act of 1990 has been introduced in the U.S. House of  Representatives to ban
the use of MTBE as a fuel additive within three years. Legislation introduced in
the U.S.  Senate would  eliminate the Clean Air Act's  oxygenate  requirement in
order to assist the elimination of MTBE in fuel. No assurance can be given as to
whether  this or  similar  federal  legislation  ultimately  will be  adopted or
whether  Congress  or the EPA  might  takes  steps to  override  the MTBE ban in
California.

     In November 1998, U.S. EPA Administrator  Carol M. Browner appointed a Blue
Ribbon Panel (the  "Panel") to  investigate  the air quality  benefits and water
quality  concerns  associated  with  oxygenates  in  gasoline,  and  to  provide
independent  advice and  recommendations  on ways to maintain air quality  while
protecting  water  quality.  The  Panel  issued a report on their  findings  and
recommendations  in July 1999. The Panel urged the  widespread  reduction in the
use of MTBE due to the growing  threat to drinking  water  sources  despite that
fact that use of  reformulated  gasolines have  contributed  to significant  air
quality improvements. The Panel credited reformulated gasoline with "substantial
reductions"  in  toxic  emissions  from  vehicles  and  recommended  that  those
reductions  be  maintained  by the use of  cleaner-burning  fuels  that  rely on
additives  other than MTBE and  improvements  in refining  processes.  The Panel
stated  that  the  problems  associated  with  MTBE  can be  characterized  as a
low-level, widespread problem that had not reached the state of a being a public
health threat. The Panel's  recommendations  are geared towards  confronting the
problems  associated  with MTBE now rather  than  letting  the issue grow into a
larger and worse problem. The Panel did not call for an outright ban on MTBE but
stated that its use should be curtailed significantly. The Panel also encouraged
a public  educational  campaign on the potential  harm posed by gasoline when it
leaks into ground water from storage tanks or while in use. Based on the Panel's
recommendations,  the EPA will ask  Congress for a revision of the Clean Air Act
of 1990 that  maintains  air  quality  gains and allows  for the  removal of the
oxygenate demand in gasoline.

     In light of these  developments,  the Company is  formulating a contingency
plan for use of the BEF MTBE  facility  if MTBE  were  banned  or  significantly
curtailed.  Management  is exploring a possible  conversion  of the BEF facility
from MTBE  production  to alkylate  production.  At present the forecast cost of
this  conversion  would be in the $15 million to $20 million  range.  Management
anticipates that if MTBE is banned alkylate demand will rise as producers use it
to replace MTBE as an octane enhancer.  Alkylate production would be expected to
generate margins comparable to those of MTBE. Greater alkylate  production would
be expected to increase isobutane consumption  nationwide and result in improved
isomerization margins for the Company.

Year 2000 Readiness Disclosure

     Pursuant to the EPCO  Agreement,  any selling,  general and  administrative
expenses  related  to Year 2000  compliance  issues  are  covered  by the annual
administrative  services  fee paid by the  Company to EPCO.  Consequently,  only
those costs  incurred in connection  with Year 2000  compliance  which relate to
operational  information  systems  and  hardware  will be paid  directly  by the
Company.

                                       18
Since  1997,  EPCO has been  assessing  the impact of Year 2000  compliance
issues on the software and hardware used by the Company. A team was assembled to
review and document the status of EPCO's and the Company's systems for Year 2000
compliance.  The key information systems reviewed include the Company's pipeline
Supervisory Control and Data Acquisition  ("SCADA") system,  plant, storage, and
other  pipeline  operating  systems.  In  connection  with each of these  areas,
consideration was given to hardware, operating systems, applications,  data base
management,  system interfaces,  electronic  transmission,  and outside vendors.
Work is nearly  complete in all areas  except for the SCADA  system.  Management
anticipates  that work on all  systems  (including  SCADA)  will be  complete by
October 1, 1999.

     As of June 30, 1999,  EPCO had spent  approximately  $264,500 in connection
with Year 2000  compliance  and has  estimated  the future costs to  approximate
$74,000. This cost estimate does not include internal costs of EPCO's previously
existing  resources  and  personnel  that might be partially  used for Year 2000
compliance or cost of normal system  upgrades  which also included  various Year
2000 compliance  features or fixes.  Such internal costs have been determined to
be materially insignificant to the total estimated cost of Year 2000 compliance.

     At this time, the Company  believes its total cost for known or anticipated
remediation of its information systems to make them Year 2000 compliant will not
be material to its financial position or its ability to sustain  operations.  As
of June 30, 1999, the Company had incurred expenditures  aggregating $154,250 in
connection  with Year 2000  compliance.  The Company  expects future spending to
approximate $871,800  (principally for the SCADA system) to complete the project
and become fully  compliant with all Year 2000 issues.  This estimated cost does
not  include  the  Company's  internal  costs  related  to  previously  existing
resources and personnel  that might be partially  used for  remediation  of Year
2000  compliance  issues.  Such  internal  costs  have  been  determined  to  be
materially  insignificant  to the total estimated cost of Year 2000  compliance.
These  amounts  are  current  cost  estimates  and  actual  future  costs  could
potentially be higher or lower than the estimates.

     The Company relies on third-party  suppliers for certain systems,  products
and services, including  telecommunications.  There can be no assurance that the
systems of other companies on which the Company's  systems rely also will timely
be compliant or that any such failure to be compliant by another  company  would
not have an adverse  effect on the Company's  systems.  The Company has received
some information concerning Year 2000 compliance status from a group of critical
suppliers and vendors, and anticipates  receiving additional  information in the
near future.  This information will assist the Company in determining the extent
to which it may be vulnerable to those third  parties'  failure to address their
Year 2000  compliance  issues.  Based on the  responses  received  to date,  the
Company  believes  that its  critical  suppliers  and vendors  will be Year 2000
compliant.

     Management  believes it has a program to address  the Year 2000  compliance
issue in a timely  manner.  Completion of the plan and testing of replacement or
modified  systems is anticipated by October 1, 1999.  Nevertheless,  since it is
not possible to anticipate all possible future  outcomes,  especially when third
parties are involved, there could be circumstances in which the Company would be
unable to  invoice  customers  or  collect  payments.  The  failure to correct a
material  Year 2000  compliance  problem could result in an  interruption  in or
failure of certain normal business activities or operations of the Company. Such
failures  could have a material  adverse  effect on the  Company.  The amount of
potential liability and lost revenue has not been estimated.

     The  Company  and  EPCO  have  developed  a  contingency  plan  to  address
unavoidable  risks associated with Year 2000 compliance  issues.  Management has
examined  the Year  2000  compliance  issue  and  determined  that a  worst-case
scenario would be a total,  unexpected  facility shutdown caused by a disruption
of  third-party  utilities   (principally  a  total  electrical  power  outage).
Enterprise  personnel  are  trained to respond  timely and  effectively  to such
emergencies;  however,  because  of the  uncertainty  surrounding  the Year 2000
problem,  the Company  will have  additional  resources  available to assist the
operations,  maintenance,  and various  other  groups on  December  31, 1999 and
January 1, 2000.  The Company will have extra  operating,  maintenance,  process
control, computer support,  environmental and safety personnel on site and/or on
standby in the event that a Year 2000 problem arises.  The Company and EPCO will
have a defined team of trained personnel available for the rollover into January
1, 2000, so that any disruption to Company or EPCO facilities can handled safely
and so  that a  return  to  normal  operations  can be  commenced  as soon as is
practicable.

                                       19
Accounting Standards

     On June 6, 1999, the Financial  Accounting  Standards Board ("FASB") issued
Statement of Financial  Accounting  Standard  ("SFAS) No. 137,  "Accounting  for
Derivative Instruments and Hedging  Activities-Deferral of the Effective Date of
FASB Statement No. 133-an amendment of FASB Statement No. 133" which effectively
delays and amends the  application  of SFAS No. 133  "Accounting  for Derivative
Instruments  and Hedging  Activities"  for one year,  to fiscal years  beginning
after June 15, 2000. Management is currently studying both SFAS No. 137 and SFAS
No. 133 for possible impact on the consolidated financial statements.

     On April 3, 1998, the American  Institute of Certified  Public  Accountants
issued Statement of Position  ("SOP") 98-5,  "Reporting on the Costs of Start-Up
Activities."  For years  beginning  after  December 15, 1998, SOP 98-5 generally
requires that all start-up costs of a business activity be charged to expense as
incurred and any start-up costs  previously  deferred should be written off as a
cumulative  effect of a change in  accounting  principle.  Adoption  of SOP 98-5
during  1999  did not  have a  material  impact  on the  consolidated  financial
statements  except for a $4.5 million noncash write-off that occurred on January
1, 1999 of the unamortized  balance of deferred  start-up costs of BEF, in which
the  Company  owns a 33-1/3%  interest.  This  write-off  caused a $1.5  million
reduction in the equity in income of  unconsolidated  affiliates  for 1999 and a
corresponding   reduction  in  the  Company's   investment   in   unconsolidated
affiliates.

Uncertainty of Forward-Looking Statements and Information.

     This  quarterly  report  contains  various  forward-looking  statements and
information that are based on the belief of the Company and the General Partner,
as well  as  assumptions  made by and  information  currently  available  to the
Company  and the  General  Partner.  When used in this  document,  words such as
"anticipate,"  "estimate,"  "project,"  "expect," "plan," "forecast,"  "intend,"
"could," and "may," and similar  expressions and statements  regarding the plans
and  objectives of the Company for future  operations,  are intended to identify
forward-looking statements. Although the Company and the General Partner believe
that  the  expectations   reflected  in  such  forward-looking   statements  are
reasonable,  they can give no assurance that such  expectations will prove to be
correct.  Such  statements  are  subject to certain  risks,  uncertainties,  and
assumptions.  If one or more of these risks or uncertainties materialize,  or if
underlying assumptions prove incorrect,  actual results may vary materially from
those anticipated, estimated, projected, or expected. Among the key risk factors
that may have a direct  bearing  on the  Company's  results  of  operations  and
financial  condition are: (a)  competitive  practices in the industries in which
the Company  competes,  (b)  fluctuations  in oil,  natural gas, and NGL product
prices and  production,  (c) operational  and systems risks,  (d)  environmental
liabilities  that are not covered by indemnity or  insurance,  (e) the impact of
current and future laws and governmental  regulations  (including  environmental
regulations) affecting the NGL industry in general, and the Company's operations
in particular,  (f) loss of a significant customer,  and (g) failure to complete
one or more new projects on time or within budget.

                                       20
Item 3.    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

     The Company is exposed to  financial  market  risks,  including  changes in
interest  rates with respect to its  investments  in financial  instruments  and
changes in  commodity  prices.  The Company  may,  but  generally  does not, use
derivative financial instruments (i.e., futures,  forwards,  swaps, options, and
other  financial   instruments  with  similar   characteristics)  or  derivative
commodity instruments (i.e., commodity futures, forwards, swaps, or options, and
other commodity  instruments with similar  characteristics that are permitted by
contract  or  business  custom to be settled in cash or with  another  financial
instrument)  to  mitigate  either of these  risks.  The return on the  Company's
financial   investments   is  generally   not   affected  by  foreign   currency
fluctuations.  The Company does not use  derivative  financial  instruments  for
speculative   purposes.  At  June  30,  1999,  the  Company  had  no  derivative
instruments in place to cover any potential  interest rate,  foreign currency or
other financial instrument risk.

     At June 30, 1999,  the Company had $4.0  million  invested in cash and cash
equivalents.  All cash equivalent investments other than cash are highly liquid,
have original  maturities of less than three months,  and are considered to have
insignificant  interest  rate  risk.  The  Company's  inventory  of NGLs and NGL
products at June 30, 1999,  was $57.6  million.  Inventories  are carried at the
lower of cost or market.  A 10% adverse change in commodity  prices would result
in an  approximate  $5.8  million  decrease  in the fair value of the  Company's
inventory,  based on a sensitivity analysis at June 30, 1999. Actual results may
differ  materially.  All the Company's  long-term  debt is at variable  interest
rates;  a 10% change in the base rate selected  would have an  approximate  $0.7
million effect on the amount of interest expense for the year based upon amounts
outstanding at June 30, 1999.

                                       21
PART II.    OTHER INFORMATION

Item 6.   Exhibits and Reports on Form 8-K

          (a) Exhibits

     *3.1 Form  of  Amended  and  Restated  Agreement of Limited Partnership of
          Enterprise  Products  Partners  L. P. ( Exhibit 3.1 to Registration
          Statement on Form S-1,File No. 333-52537, filed on May 13, 1998).

     *3.2 Form of Amended  and  Restated  Agreement  of Limited  Partnership  of
          Enterprise  Products  Operating  L.P.  (Exhibit  3.2  to  Registration
          Statement on Form S-1/A, File No. 333-52537, filed on July 21, 1998).

     *3.3 LLC Agreement of Enterprise  Products GP (Exhibit 3.3 to  Registration
          Statement on Form S-1/A, File No. 333-52537, filed on July 21, 1998).

     *4.1 Form of Common Unit certificate (Exhibit 4.1 to Registration Statement
          on Form S-1/A, File No. 333-52537, filed on July 21, 1998).

     *4.2 Credit Agreement among Enterprise Products Operating L.P., the Several
          Banks from Time to Time Parties Hereto,  Den Norske Bank ASA, and Bank
          of Tokyo-Mitsubishi, Ltd., Houston Agency as Co-Arrangers, The Bank of
          Nova Scotia,  as Co-Arranger and as Documentation  Agent and The Chase
          Manhattan Bank as  Co-Arranger  and as Agent dated as of July 27, 1998
          as Amended and Restated as of September 30, 1998. (Exhibit 4.2 on Form
          10-K for year ended December 31, 1998, filed March 17, 1999).

     *10.1 Articles  of Merger  of  Enterprise  Products  Company,  HSC Pipeline
          Partnership, L.P., Chunchula Pipeline Company, LLC, Propylene Pipeline
          Partnership, L.P., Cajun Pipeline Company, LLC and Enterprise Products
          Texas  Operating L.P. dated June 1, 1998 (Exhibit 10.1 to Registration
          Statement on Form S-1/A, File No: 333-52537, filed on July 8, 1998).

     *10.2 Form of EPCO  Agreement  between  Enterprise Products  Partners L.P.,
          Enterprise  Products Operating L.P.,  Enterprise  Products GP, LLC and
          Enterprise Products Company (Exhibit 10.2 to Registration Statement on
          Form S-1/A, File No. 333-52537, filed on July 21, 1998).

     *10.3Transportation  Contract between  Enterprise  Products  Operating L.P.
          and Enterprise Transportation Company dated June 1, 1998 (Exhibit 10.3
          to Registration Statement on Form S-1/A, File No. 333-52537,  filed on
          July 8, 1998).

     *10.4Venture  Participation  Agreement  between Sun  Company,  Inc.  (R&M),
          Liquid Energy Corporation and Enterprise Products Company dated May 1,
          1992  (Exhibit  10.4 to  Registration  Statement on Form S-1, File No.
          333-52537, filed on May 13, 1998).

     *10.5Partnership  Agreement  between Sun BEF,  Inc.,  Liquid  Energy  Fuels
          Corporation and Enterprise Products Company dated May 1, 1992 (Exhibit
          10.5 to Registration Statement on Form S-1, File No. 333-52537,  filed
          on May 13, 1998).

                                       22
*10.6Amended  and  Restated  MTBE  Off-Take   Agreement   between   Belvieu
          Environmental Fuels and Sun Company,  Inc. (R&M) dated August 16, 1995
          (Exhibit  10.6  to  Registration  Statement  on  Form  S-1,  File  No.
          333-52537, filed on May 13, 1998).

     *10.7Articles of Partnership of Mont Belvieu Associates dated July 17, 1985
          (Exhibit  10.7  to  Registration  Statement  on  Form  S-1,  File  No.
          333-52537, filed on May 13, 1998).

     *10.8First Amendment to Articles of Partnership of Mont Belvieu  Associates
          dated July 15, 1996  (Exhibit 10.8 to  Registration  Statement on Form
          S-1, File No. 333-52537, filed on May 13, 1998).

     *10.9Propylene   Facility  and  Pipeline   Agreement   between   Enterprise
          Petrochemical  Company and Hercules  Incorporated  dated  December 13,
          1978  (Exhibit  10.9 to  Registration  Statement on Form S-1, File No.
          333-52537, dated May 13, 1998).

     *10.10 Restated  Operating  Agreement  for the Mont  Belvieu  Fractionation
          Facilities Chambers County, Texas between Enterprise Products Company,
          Texaco  Producing  Inc.,  El Paso  Hydrocarbons  Company and  Champlin
          Petroleum  Company dated July 17, 1985 (Exhibit 10.10 to  Registration
          Statement on Form S-1/A, File No. 333-52537, filed on July 8, 1998).

     *10.11  Ratification  and  Joinder  Agreement   relating  to  Mont  Belvieu
          Associates  Facilities  between  Enterprise  Products Company,  Texaco
          Producing  Inc.,  El Paso  Hydrocarbons  Company,  Champlin  Petroleum
          Company and Mont Belvieu Associates dated July 17, 1985 (Exhibit 10.11
          to Registration Statement on Form S-1/A, File No. 333-52537,  filed on
          July 8, 1998).

     *10.12Amendment to Propylene  Facility and Pipeline Sales Agreement between
          HIMONT U.S.A.,  Inc. and Enterprise  Products Company dated January 1,
          1993 (Exhibit 10.12 to Registration  Statement on Form S-1/A, File No.
          333-52537, filed on July 8, 1998).

     *10.13Amendment to Propylene Facility and Pipeline Agreement between HIMONT
          U.S.A.,  Inc. and  Enterprise  Products  Company dated January 1, 1995
          (Exhibit  10.13 to  Registration  Statement  on Form  S-1/A,  File No.
          333-52537, filed on July 8, 1998).

     27.1 Financial Data Schedule

         * Asterisk indicates exhibits incorporated by reference as indicated

                                       23
(b) Reports on Form 8-K

         One report on Form 8-K was filed during the second quarter of 1999.

          Form 8-K dated April 20, 1999,  reporting  that the Company  announced
          the general  terms of an agreement  to form a major NGL alliance  with
          Tejas Energy ("Tejas"),  an affiliate of Shell Oil Company  ("Shell").
          Under the terms of the alliance  Shell will  contribute  its ownership
          interests  in its  natural  gas  processing,  NGL  fractionation,  NGL
          storage and NGL transportation  assets in Mississippi and Louisiana to
          the  Company in  exchange  for an equity  interest  in the Company and
          other  consideration.  The completion of this transaction would form a
          strategic  business  combination  comprising a fully  integrated  Gulf
          Coast  NGL  processing,   fractionation,  storage  and  transportation
          business. It also establishes a strategic alliance between the Company
          and Shell whereby the Company would have the rights to process Shell's
          current and future Gulf of Mexico  natural gas  production  and market
          the NGLs recovered.

          All of Tejas' NGL assets in  Louisiana  and  Mississippi  are included
          under  the  terms  of  the  combination.  This  includes  its  varying
          interests in 11 natural gas  processing  plants  (including  one under
          construction)  with a combined  gross  capacity  of  approximately  11
          billion cubic feet per day; four NGL  fractionation  facilities with a
          combined gross capacity of approximately  240,000 barrels per day; NGL
          storage  facilities  with  approximately  29 million  barrels of gross
          capacity; and over 1,800 miles of NGL pipelines (including an interest
          in the Dixie Pipeline).

          The  transaction  is subject  to the  Company  and Tejas  successfully
          executing a  definitive  agreement;  satisfactorily  completing  their
          respective  due  diligence  reviews;  receiving  requisite  regulatory
          approvals  and  receiving  approvals  from  each  company's  board  of
          directors.  The parties anticipate closing of the transaction to occur
          by the end of the third quarter of 1999.

                                       24
Signatures

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

                                           Enterprise Products Partners L.P.
                                           (A Delaware Limited Partnership)

                                       By: Enterprise Products GP, LLC
                                           as General Partner

Date:   August 9, 1999                 By:      /s/  Gary L. Miller
                                           _____________________________________
                                           Executive Vice President
                                           Chief Financial Officer and Treasurer

                                       25