Published: 2022-08-12 00:00:00 ET

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a)Statement of Compliance

These unaudited interim condensed and consolidated financial statements (“interim financial statements”) of our company and its subsidiaries have been prepared in accordance with International Accounting Standard 34, Interim Financial Reporting (“IAS 34”) as issued by the International Accounting Standards Board (“IASB”) and using the accounting policies our company applied in its consolidated financial statements as of and for the year-ended December 31, 2021 (“consolidated financial statements”). The accounting policies that our company applied in its consolidated financial statements are disclosed in Note 3 of such financial statements, of which reference should be made in reading these interim financial statements. In addition to the accounting policies disclosed in Note 3 of our consolidated financial statements, our interim financial statements have been prepared in accordance with the accounting policies described below .

These interim financial statements were authorized for issuance by the Board of Directors of our company on August 11, 2022.

b)Basis of presentation

The interim financial statements are prepared on a going concern basis.

Associates

Associates are entities over which our company has significant influence. Significant influence is the power to participate in the financial and operating policy decisions of the investee but does not constitute control. Our company accounts for investments over which it has significant influence using the equity method, and are recorded as Investments in associates on the unaudited interim condensed and consolidated statements of financial position.

Interests in investments accounted for using the equity method are initially recorded at cost. If the cost of the associate is lower than the proportionate share of the investment’s underlying fair value, our company records a gain on the difference between the cost and the underlying fair values of the identifiable net assets of the associate. If the cost of the associate is greater than our company’s proportionate share of the underlying fair value, goodwill and other adjustments arising from the purchase price allocation relating to the associate is included in the carrying amount of the investment. Subsequent to initial recognition, the carrying value of our company’s interest in an investee is adjusted for our company’s share of comprehensive income or loss and distributions from the investee.

Profits or losses resulting from transactions with an associate are recognized in the interim financial statements based on the interests of unrelated investors in the associate.

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Dispositions Completed in 2021

a) Disposition of our U.K. regulated distribution business’s portfolio of smart meters

On May 12, 2021, our U.K. regulated distribution business sold its smart meters business for gross consideration of approximately $820 million. After the repayment of debt and working capital requirements at the business, our company received net proceeds of approximately $340 million. The business recognized a gain of approximately $195 million in Other income (expense) on the Consolidated Statements of Operating Results, of which approximately $155 million is attributable to our company. Our company’s share of accumulated revaluation surplus of $142 million was reclassified from accumulated other comprehensive income directly to retained earnings and recorded within Other items on the Consolidated Statements of Equity. Our company’s share of net losses relating to previous foreign exchange movements of $17 million was reclassified from accumulated other comprehensive income to Other income (expense) on the Consolidated Statements of Operating Results.

Acquisitions Completed in 2021

a) Acquisition of additional interest in our Brazilian regulated gas transmission operation

On April 30, 2021, Brookfield Infrastructure, alongside institutional partners (the “NTS consortium”), acquired an additional 3% interest (NTS consortium total of 10%) in our Brazilian regulated gas transmission operation, increasing our company’s ownership of the business to approximately 31%. Total consideration paid was $87 million (NTS consortium total of $283 million), all of which was funded using asset level debt raised on closing. As a result of the purchase price exceeding the previous carrying value of non-controlling interests, a loss of $32 million was recognized directly in ownership changes and recorded within Other items on the Consolidated Statements of Equity.

The fair value of a financial instrument is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair values are determined by reference to quoted bid or ask prices, as appropriate. Where bid and ask prices are unavailable, the closing price of the most recent transaction of that instrument is used. In the absence of an active market, fair values are determined based on prevailing market rates such as bid and ask prices, as appropriate for instruments with similar characteristics and risk profiles or internal or external valuation models, such as option pricing models and discounted cash flow analyses, using observable market inputs.

Fair values determined using valuation models require the use of assumptions concerning the amount and timing of estimated future cash flows and discount rates. In determining those assumptions, our company looks primarily to external readily observable market inputs such as interest rate yield curves, currency rates, and price and rate volatilities as applicable. The fair value of interest rate swap contracts which form part of financing arrangements is calculated by way of discounted cash flows using market interest rates and applicable credit spreads.

Classification of Financial Instruments

Financial instruments classified as fair value through profit or loss are carried at fair value on the unaudited interim condensed and consolidated statements of financial position. Changes in the fair values of financial instruments classified as fair value through profit or loss are recognized in profit or loss. Mark-to-market adjustments on hedging items for those in an effective hedging relationship and changes in the fair value of securities designated as fair value through other comprehensive income are recognized in other comprehensive income.

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Carrying Value and Fair Value of Financial Instruments

The following table provides the allocation of financial instruments and their associated financial instrument classifications as at June 30, 2022:

US$ MILLIONS Financial Instrument Classification
MEASUREMENT BASIS			Fair value through profit or loss												Amortized Cost						Total
Financial assets
Cash and cash equivalents			$	—											$	512					$	512
Accounts receivable and other (current and non-current)			—												423						423
Financial assets(1)			168												—						168
Due from Brookfield Infrastructure			—												558						558
Total			$	168											$	1,493					$	1,661
Financial liabilities
Accounts payable and other (current and non-current)			$	—											$	467					$	467
Non-recourse borrowings (current and non-current)			—												4,473						4,473
Exchangeable and class B shares(2)			—												4,222						4,222
Loans payable to Brookfield Infrastructure			—												131						131
Total			$	—											$	9,293					$	9,293

1.Derivative instruments which are elected for hedge accounting totaling $98 million are included in financial assets and $nil of derivative instruments are included in financial liabilities.

2.Class C shares are also classified as financial liabilities due to their cash redemption feature. However, the class C shares meet certain qualifying criteria and are presented as equity. See Note 15, Equity.

The following table provides the allocation of financial instruments and their associated financial instrument classifications as at December 31, 2021:

US$ MILLIONS Financial Instrument Classification
MEASUREMENT BASIS			Fair value through profit or loss												Amortized Cost						Total
Financial assets
Cash and cash equivalents			$	—											$	469					$	469
Accounts receivable and other (current and non-current)			—												402						402
Financial assets(1)			30												—						30
Due from Brookfield Infrastructure			—												1,093						1,093
Total			$	30											$	1,964					$	1,994
Financial liabilities
Accounts payable and other (current and non-current)			$	—											$	416					$	416
Non-recourse borrowings (current and non-current)			—												3,556						3,556
Exchangeable and class B shares(2)			—												4,466						4,466
Financial liabilities (current and non-current)(1)			—												995						995
Loans payable to Brookfield Infrastructure			—												131						131
Total			$	—											$	9,564					$	9,564

1.Derivative instruments which are elected for hedge accounting totaling $30 million are included in financial assets and $nil of derivative instruments are included in financial liabilities.

2.Class C shares are also classified as financial liabilities due to their cash redemption feature. However, the class C shares meet certain qualifying criteria and are presented as equity. See Note 15, Equity.

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The following table provides the carrying values and fair values of financial instruments as at June 30, 2022 and December 31, 2021:

			June 30, 2022												December 31, 2021
US$ MILLIONS			Carrying Value						Fair Value						Carrying Value						Fair Value
Financial assets
Cash and cash equivalents			$	512					$	512					$	469					$	469
Accounts receivable and other (current and non-current)			423						423						402						402
Financial assets			168						168						30						30
Due from Brookfield Infrastructure			558						558						1,093						1,093
Total			$	1,661					$	1,661					$	1,994					$	1,994
Financial liabilities
Accounts payable and other (current and non-current)			$	467					$	467					$	416					$	416
Non-recourse borrowings (current and non-current)(1)			4,473						4,375						3,556						3,627
Exchangeable and class B shares(2)			4,222						4,222						4,466						4,466
Financial liabilities (current and non-current)			—						—						995						995
Loans payable to Brookfield Infrastructure			131						131						131						131
Total			$	9,293					$	9,195					$	9,564					$	9,635

1.Non-recourse borrowings are classified under level 2 of the fair value hierarchy. For level 2 fair values, future cash flows are estimated based on observable forward interest rates at the end of the reporting period.

2.Class C shares are also classified as financial liabilities due to their cash redemption feature. However, the class C shares meet certain qualifying criteria and are presented as equity. For the purpose of the disclosure above, the class C shares have a fair value of $80 million as at June 30, 2022.

Hedging Activities

Our company uses derivatives and non-derivative financial instruments to manage or maintain exposures to interest and currency risks. For certain derivatives which are used to manage exposures, our company determines whether hedge accounting can be applied. When hedge accounting can be applied, a hedge relationship can be designated as a fair value hedge, cash flow hedge or a hedge of foreign currency exposure of a net investment in a foreign operation with a functional currency other than the U.S. dollar. To qualify for hedge accounting, the derivative must be designated as a hedge of a specific exposure and the hedging relationship must meet all of the hedge effectiveness requirements in accomplishing the objective of offsetting changes in the fair value or cash flows attributable to the hedged risk both at inception and over the life of the hedge. If it is determined that the hedging relationship does not meet all of the hedge effectiveness requirements, hedge accounting is discontinued prospectively.

Cash Flow Hedges

Our company uses interest rate swaps to hedge the variability in cash flows related to a variable rate asset or liability and highly probable forecasted issuances of debt. The settlement dates coincide with the dates on which the interest is payable on the underlying debt, and the amount accumulated in equity is reclassified to profit or loss over the period that the floating rate interest payments on debt affect profit or loss. For the three and six-month periods ended June 30, 2022, pre-tax net unrealized losses of $1 million and $3 million, respectively (2021: $nil and $nil, respectively), were recorded in other comprehensive income for the effective portion of the cash flow hedges. As of June 30, 2022, there was a net derivative asset balance of $98 million relating to derivative contracts designated as cash flow hedges (December 31, 2021: $30 million).

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Fair Value Hierarchical Levels—Financial Instruments

Fair value hierarchical levels are directly determined by the amount of subjectivity associated with the valuation inputs of these assets and liabilities, and are as follows:

Level 1

—

Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date.

Level 2

—

Inputs other than quoted prices included in Level 1 are either directly or indirectly observable for the asset or liability through correlation with market data at the measurement date and for the duration of the instrument’s anticipated life. Fair valued assets and liabilities that are included in this category are primarily certain derivative contracts and other financial assets carried at fair value in an inactive market.

Level 3

—

Inputs reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to determining the estimate. Fair valued assets and liabilities that are included in this category are interest rate swap contracts, derivative contracts, certain equity securities carried at fair value which are not traded in an active market and the non-controlling interest’s share of net assets of limited life funds.

The fair value of our company’s financial assets and financial liabilities are measured at fair value on a recurring basis. The following table summarizes the valuation techniques and significant inputs for our company’ financial assets and financial liabilities:

US$ MILLIONS			Fair value hierarchy						June 30, 2022						December 31, 2021
Interest rate swaps & other			Level 2(1)
Financial assets									$	98					$	30
Financial liabilities									—						—
Other instruments			Level 3(2)
Financial assets									$	70					$	—
Financial liabilities									—						—

1.Valuation technique: Discounted cash flow. Future cash flows are estimated based on forward exchange and interest rates (from observable forward exchange and interest rates at the end of the reporting period) and contract forward rates, discounted at a rate that reflects our credit risk and the credit risk of various counterparties.

2.Valuation technique: Discounted cash flow. Future cash flows primarily driven by assumptions concerning the amount and timing of estimated future cash flows and discount rates

During the six-month period ended June 30, 2022, no transfers were made between level 1 and 2 or level 2 and 3.

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US$ MILLIONS			Gross carrying amount						Accumulated depreciation						Accumulated fair value adjustments						Total
Balance at January 1, 2021			$	4,197					$	(719)					$	1,633					$	5,111
Additions, net of disposals			367						10						—						377
Assets held by subsidiaries disposed during the period			(599)						163						(217)						(653)
Non-cash disposals			(1)						(3)						—						(4)
Depreciation expense			—						(128)						—						(128)
Fair value adjustments			—						—						134						134
Net foreign currency exchange differences			(29)						4						(9)						(34)
Balance at December 31, 2021			$	3,935					$	(673)					$	1,541					$	4,803
Additions, net of disposals			209						3						—						212
Non-cash additions			2						(2)						—						—
Depreciation expense			—						(57)						—						(57)
Net foreign currency exchange differences			(407)						71						(155)						(491)
Balance at June 30, 2022			$	3,739					$	(658)					$	1,386					$	4,467

Property, plant and equipment of our company is predominantly comprised of last mile utility connections at our U.K. regulated distribution operation which provides essential services and generate regulated cash flows. Tariffs are set on the basis of a regulated asset base, provides inflation protection, and are typically adjusted annually. Our U.K. operation has a diverse customer base throughout England, Scotland, and Wales, which underpins its cash flows.

			As of
US$ MILLIONS			June 30, 2022						December 31, 2021
Cost			$	3,575					$	3,332
Accumulated amortization			(729)						(645)
Total			$	2,846					$	2,687

Intangible assets are allocated to the following cash generating units:

			As of
US$ MILLIONS			June 30, 2022						December 31, 2021
Brazilian regulated gas transmission operation			$	2,812					$	2,645
U.K. regulated distribution operation			34						42
Total			$	2,846					$	2,687

Our company’s intangible assets are primarily related to concession arrangements with the local energy regulator, Agência Nacional do Petróleo, Gás Natural e Biocombustíveis (“ANP”), at our Brazilian regulated gas transmission operation. Total capacity is fully contracted under long-term “ship-or-pay” gas transportation agreements (“GTA”) and therefore the business is exposed to no volume or price risk. Each GTA takes into account a return on regulatory asset base (“RAB”), and the tariffs are calculated on an inflation adjusted regulatory weighted average cost of capital (“WACC”) fixed for the life of GTAs. On April 8, 2021, new legislation was passed in Brazil which provides our Brazilian regulated gas transmission operation the right to operate the gas pipelines perpetually.

The intangible assets at our U.K. regulated distribution operation relate to customer order backlogs, which represents the present value of future earnings derived from the build out of contracted connections at the acquisition date of the U.K. regulated distribution operation.

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The following table presents the change in the cost balance of intangible assets:

US$ MILLIONS			For the six-month period ended June 30, 2022						For the 12 month period ended December 31, 2021
Cost at beginning of the period			$	3,332					$	3,527
Additions, net of disposals			41						38
Non cash additions			—						5
Foreign currency translation			202						(238)
Ending Balance			$	3,575					$	3,332

The following table presents the accumulated amortization for our company’s intangible assets:

US$ MILLIONS			For the six-month period ended June 30, 2022						For the 12 month period ended December 31, 2021
Accumulated amortization at beginning of the period			$	(645)					$	(579)
Amortization			(51)						(108)
Foreign currency translation			(33)						42
Ending Balance			$	(729)					$	(645)

The following table represents the change in balance of investments in associates:

US$ MILLIONS			For the six-month period ended June 30, 2022
Balance at the beginning of the period			$	—
Acquisitions			455
Share of losses for the period			(4)
Foreign currency translation and other			(19)
Share of other comprehensive income			4
Distributions			(17)
Ending Balance			$	419

In February 2022, our company acquired an approximate 8% interest in an Australian regulated utility, AusNet Services Ltd (“AusNet”) for $455 million. Based on our ownership interest and governance rights retained, our company equity accounts for the entity.

The following tables summarize the aggregate balances of investments in associates on a 100% basis:

			As of
US$ MILLIONS			June 30, 2022
Financial position:
Total assets			13,868
Total liabilities			(8,462)
Net assets			$	5,406

US$ MILLIONS			For the three-month period ended June 30, 2022						For the six-month period ended June 30, 2022
Financial performance:
Total revenue			$	361											$	521
Total net income for the period(1)			36												(52)
Our company’s share of net income			$	2											$	(4)

1.Total net income for the six-month period ended June 30, 2022 includes acquisition-related transaction costs of $105 million.

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The following table presents the carrying amount for our company’s goodwill:

			As of
US$ MILLIONS			June 30, 2022						December 31, 2021
Balance at beginning of the period			$	489					$	528
Foreign currency translation and other			27						(39)
Ending Balance			$	516					$	489

Non-Recourse Borrowings

			As of
US$ MILLIONS			June 30, 2022						December 31, 2021
Current			$	1,315					$	—
Non-current			3,158						3,556
Total			$	4,473					$	3,556

Non-recourse borrowings have increased by $917 million since year-end. The increase is primarily attributable to debt raised by our Brazilian regulated gas transmission business in connection with financing our deferred consideration obligation, partially offset by the impact of foreign exchange.

						As of
US$ MILLIONS						June 30, 2022						December 31, 2021
Current:
Deferred consideration						—						995
Total current financial liabilities						$	—					$	995

Deferred consideration

Deferred consideration is related to the April 4, 2017 acquisition of Nova Transportadora do Sudeste S.A. (“NTS”), our Brazilian regulated gas transmission business. The deferred consideration was denominated in U.S. dollars and accrued interest at 3.35% compounded annually. The financial liability was measured at amortized cost and was settled on April 4, 2022, the fifth anniversary of the date of acquisition.

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Exchangeable shares, class B shares and class C shares

The exchangeable and class B shares are classified as liabilities due to their exchangeable and cash redemption features. Upon issuance, exchangeable and class B shares are recognized at their fair value. Subsequent to initial recognition, the exchangeable and class B shares are recognized at amortized cost and remeasured to reflect changes in the contractual cash flows associated with the shares. These contractual cash flows are based on the price of one unit of the partnership.

In August 2021, the partnership acquired a controlling interest in Inter Pipeline Limited (“IPL”) for consideration comprised of cash, exchangeable shares and class B exchangeable limited partnership units (“BIPC exchangeable LP units”) of Brookfield Infrastructure Corporation Exchange Limited Partnership (“BIPC Exchange LP”). BIPC Exchange LP is a subsidiary of the partnership and holders of BIPC exchangeable LP units have the right to require the partnership to purchase BIPC exchangeable LP units and deliver one exchangeable share for each BIPC exchangeable LP unit purchased. During the six-month period ended June 30, 2022, our company issued 317,595 exchangeable shares in connection with exchange requests from BIPC Exchange LP unit holders. Upon issuance, the exchangeable shares were recognized at their fair value.

During the six-month period ended June 30, 2022, our shareholders exchanged 6,332 exchangeable shares for an equal number of partnership units. As at June 30, 2022, the exchangeable and class B shares were remeasured to reflect the NYSE closing price of one unit, $38.22 per share. Remeasurement gains or losses associated with these shares are recorded in the unaudited interim condensed and consolidated statements of operating results. Our company declared and paid dividends of $39 million and $79 million on its exchangeable shares outstanding during the three and six-month periods ended June 30, 2022, respectively (2021: $23 million and $46 million, respectively). Dividends paid on exchangeable shares are presented as interest expense in the unaudited interim condensed and consolidated statements of operating results.

On June 10, 2022, Brookfield Infrastructure completed a three-for-two stock split of partnership units, BIPC exchangeable LP units, exchangeable shares, class B shares and class C shares, by way of a subdivision whereby unitholders/shareholders received an additional one-half of a unit/share for each unit/share held. All historical units/shares and per unit/share disclosures have been adjusted to effect for the change in units/shares due to the stock split.

The following table provides a continuity schedule of outstanding exchangeable shares and class B shares along with our corresponding liability and remeasurement gains and losses:

			Exchangeable shares outstanding (Shares)						Class B shares outstanding (Shares)												Exchangeable and class B shares (US$ Millions)
Balance at January 1, 2021			67,441,451						2												$	2,221
Share issuance(1)			42,195,641						—												1,776
Share issuance - BIPC exchangeable LP unit exchanges			556,997						—												23
Shares exchanged to units			(36,549)						—												(1)
Remeasurement of liability			—						—												447
Balance at December 31, 2021			110,157,540						2												$	4,466
Share issuance - BIPC exchangeable LP unit exchanges			317,595						—												15
Shares exchanged to units			(6,332)						—												—
Remeasurement of liability			—						—												(259)
Balance as at June 30, 2022			110,468,803						2												$	4,222

1.During the year ended December 31, 2021, our company issued 3.2 million shares in exchange for net cash consideration of $128 million. The remaining shares were issued to subsidiaries of the partnership in exchange for non-cash consideration including loans receivable and settlements of loan payable.

Similar to class B shares, class C shares are classified as liabilities due to their cash redemption feature. However, class C shares, the most subordinated class of all common shares, meet certain qualifying criteria and are presented as equity instruments given the narrow scope presentation exceptions existing in IAS 32. Refer to Note 15, Equity, for further details related to class C shares.

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a)Revenues by service line

Substantially all of these revenues are recognized over time as services are rendered. The following table disaggregates revenues by service line:

			For the three-month period ended June 30												For the six-month period ended June 30
US$ MILLIONS			2022						2021						2022						2021
Gas Transmission			$	343					$	272					$	663					$	530
Distribution			86						92						177						196
Connections			45						45						85						78
Other			5						7						15						11
Total			$	479					$	416					$	940					$	815

During the three and six-month periods ended June 30, 2022, revenues benefited from inflationary tariff increases and capital commissioned into rate base.

b)Revenues from external customers

The following table disaggregates revenues by geographical region:

			For the three-month period ended June 30												For the six-month period ended June 30
US$ MILLIONS			2022						2021						2022						2021
Brazil			$	343					$	272					$	663					$	530
United Kingdom			136						144						277						285
Total			$	479					$	416					$	940					$	815

Our company’s revenues are generated from a diverse customer base, with only one customer that makes up greater than 10% of our company’s consolidated revenues. For the three and six-month periods ended June 30, 2022, revenue generated from this customer was $343 million and $663 million, respectively (2021: $272 million and $530 million). Our company has completed a review of the credit risk of key counterparties. Based on their liquidity position, business performance, and aging of our accounts receivable, we do not have any significant changes in expected credit losses at this time. Our company continues to monitor the credit risk of our counterparties in light of the current economic environment.

Direct operating costs are costs incurred to earn revenue and include all attributable expenses. The following table lists direct operating costs for the three and six-month periods ended June 30, 2022, and 2021. Comparative figures have been reclassified to conform to the current period’s presentation:

						For the three-month period ended June 30												For the six-month period ended June 30
US$ MILLIONS						2022						2021						2022						2021
Depreciation and amortization						$	54					$	70					$	108					$	145
Transportation and distribution						40						40						80						80
Operations and maintenance						14						12						29						24
Compensation						15						11						30						20
Cost of inventory						1						2						4						3
Other						7						7						14						14
Total						$	131					$	142					$	265					$	286

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For the three and six-month periods ended June 30, 2022, net income included a $90 million deferred tax recovery due to an internal restructuring at our Brazilian regulated gas transmission business.

On May 24, 2021, Finance Bill 2021 in the U.K. became substantively enacted. As a result, effective April 2023, the U.K. tax rate will increase from 19% to 25%. During the three and six-month periods ended June 30, 2021, net income and accumulated other comprehensive income included $96 million and $87 million of deferred tax expenses, respectively, related to the rate change. There was no corresponding impact to the results for the three and six-month periods ended June 30, 2022.

Our company’s equity is comprised of the following shares:

			Class C shares
			Shares outstanding (Shares)1						Share capital (US$ Millions)
Balance at January 1, 2021			2,103,677						$	53
Share issuance			—						—
Balance at December 31, 2021 and June 30, 2022			2,103,677						$	53

1.Shares outstanding have been adjusted to effect for the change in shares due to the stock split. See Note 11, Financial Liabilities.

Our company’s share capital is comprised of exchangeable shares, class B shares and class C shares. Due to the exchange feature of the exchangeable shares and the cash redemption feature of the class B and class C shares, the exchangeable shares, the class B shares, and the class C shares are classified as financial liabilities. However, class C shares, the most subordinated of all common shares, meet certain qualifying criteria and are presented as equity instruments given the narrow scope presentation exceptions existing in IAS 32. Refer to Note 11, Financial Liabilities, for further details related to exchangeable and class B shares.

In the normal course of operations, our company entered into the transactions below with related parties. The ultimate parent of our company is Brookfield. Other related parties of our company represent Brookfield’s subsidiary and operating entities.

Since inception, our partnership has had a management agreement (the “Master Services Agreement”), with certain service providers (the “Service Providers”) which are wholly-owned subsidiaries of Brookfield.

Pursuant to the Master Services Agreement, on a quarterly basis, the partnership pays a base management fee, referred to as the Base Management Fee, to the Service Provider equal to 0.3125% per quarter (1.25% annually) of the combined market value of the partnership and our company. Our company reimburses the partnership for our proportionate share of the management fee. For purposes of calculating the base management fee, the market value of the partnership is equal to the aggregate value of all the outstanding units (assuming full conversion of Brookfield’s Redeemable Partnership Units in Brookfield Infrastructure into units), preferred units and securities of the other Service Recipients (as defined in the Master Services Agreement) that are not held by Brookfield Infrastructure, plus all outstanding third-party debt with recourse to a Service Recipient, less all cash held by such entities. The amount attributable to our company is based on weighted average units and shares outstanding, after retroactively adjusting for the special distribution.

The Base Management Fee attributable to our company was $16 million and $34 million for the three and six-month periods ended June 30, 2022, respectively (2021: $9 million and $18 million, respectively) and has been recorded as part of general and administrative expenses in the interim financial statements.

Our company’s affiliates provide connection services in the normal course of operations on market terms to affiliates and associates of Brookfield Property Partners L.P. For the three and six-month periods ended June 30, 2022, revenues of less than $1 million were generated (2021: less than $1 million) and $nil expenses were incurred (2021: $nil).

Our company is party to two credit agreements with Brookfield Infrastructure, one as borrower and one as lender, each providing for a ten-year revolving $1 billion credit facility for purposes of providing our company and Brookfield Infrastructure with access to debt financing on an as-needed basis and to maximize our flexibility and facilitate the movement of cash within our group. We intend to use the liquidity provided by the credit facilities for working capital purposes and to fund growth capital investments and acquisitions. The determination of which of these sources of funding our company will access in any particular situation will be a matter of optimizing needs and opportunities at that time.

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The credit facilities are available in U.S. or Canadian dollars, and advances will be made by way of LIBOR, base rate, CDOR, or prime rate loans. Both operating facilities bear interest at the benchmark rate plus an applicable spread, in each case subject to adjustment from time to time as the parties may agree. In addition, each credit facility contemplates potential deposit arrangements pursuant to which the lender thereunder would, with the consent of a borrower, deposit funds on a demand basis to such borrower’s account at market interest rate. As of June 30, 2022, $nil (December 31, 2021: $nil) was drawn on the credit facilities under the credit agreements with Brookfield Infrastructure.

Brookfield Infrastructure provided our company an equity commitment in the amount of $1 billion. The equity commitment may be called by our company in exchange for the issuance of a number of class C shares or preferred shares, as the case may be, to Brookfield Infrastructure, corresponding to the amount of the equity commitment called divided (i) in the case of a subscription for class C shares, by the volume-weighted average of the trading price for one exchangeable share on the principal stock exchange on which our exchangeable shares are listed for the five (5) days immediately preceding the date of the call, and (ii) in the case of a subscription for preferred shares, $25.00. The equity commitment will be reduced permanently by the amount so called. As at June 30, 2022, $nil (December 31, 2021: $nil) was called on the equity commitment.

BIPC Holdings Inc., a wholly owned subsidiary of our company, fully and unconditionally guaranteed (i) any unsecured debt securities issued by Brookfield Infrastructure Finance ULC, Brookfield Infrastructure Finance LLC, Brookfield Infrastructure Finance Limited and Brookfield Infrastructure Finance Pty Ltd., which we refer to collectively as the “Co-Issuers”, in each case as to payment of principal, premium (if any) and interest when and as the same will become due and payable under or in respect of the trust indenture dated October 10, 2012 among the Co-Issuers and Computershare Trust Company of Canada under which such securities are issued, (ii) the senior preferred shares of BIP Investment Corporation (“BIPIC”), as to the payment of dividends when due, the payment of amounts due on redemption and the payment of amounts due on the liquidation, dissolution or winding up of BIPIC, (iii) certain of the partnership’s preferred units, as to payment of distributions when due, the payment of amounts due on redemption and the payment of amounts due on the liquidation, dissolution or winding up of the partnership, and (iv) the obligations of Brookfield Infrastructure under its bilateral credit facilities. These arrangements do not have or are not reasonably likely to have a material current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors. In addition, BIPC Holdings Inc. guaranteed (i) subordinated debt securities issued by Brookfield Infrastructure Finance ULC or BIP Bermuda Holdings I Limited on a subordinated basis, as to payment of principal, premium (if any) and interest when and as the same will become due and payable under or in respect of the trust indenture under which such securities are issued, and (ii) the obligations of Brookfield Infrastructure Holdings (Canada) Inc. under its commercial paper program.

As at June 30, 2022, the balance outstanding on our deposit with Brookfield Infrastructure was $558 million (December 31, 2021: $1,093 million). The balance decreased from December 31, 2021 due to net repayments from Brookfield Infrastructure of $535 million. The deposit accrues interest at 0.2% per annum. As at June 30, 2022, the demand deposit payable to Brookfield Infrastructure was $131 million (December 31, 2021: $131 million). The deposit accrues interest at 0.2% per annum. Interest incurred on the deposit payable to Brookfield Infrastructure during the three and six-month periods ended June 30, 2022 was less than $1 million (2021: $13 million and $26 million, respectively).

As at June 30, 2022, our company had accounts payable of $9 million (December 31, 2021: $5 million) to subsidiaries of Brookfield Infrastructure and accounts receivable of $9 million (December 31, 2021: $20 million) from subsidiaries of Brookfield Infrastructure.

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						For the three-month period ended June 30												For the six-month period ended June 30
US$ MILLIONS						2022						2021						2022						2021
Interest paid						$	136					$	76					$	203					$	127
Income taxes paid						$	32					$	34					$	242					$	145

Amounts paid and received for interest were reflected as operating cash flows in the unaudited interim condensed and consolidated statements of cash flows. Interest paid is net of debt related hedges.

Amounts paid for income taxes were reflected as either operating cash flows or investing cash flows in the unaudited interim condensed and consolidated statements of cash flows depending upon the nature of the underlying transaction.

Details of “Changes in non-cash working capital, net” on the unaudited interim condensed and consolidated statements of cash flows are as follows:

						For the three-month period ended June 30												For the six-month period ended June 30
US$ MILLIONS						2022						2021						2022						2021
Accounts receivable						$	(25)					$	(16)					$	(44)					$	(56)
Accounts payable and other						85						32						39						(5)
Changes in non-cash working capital, net						$	60					$	16					$	(5)					$	(61)

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