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EXHIBIT 8.1
[VINSON & ELKINS LETTERHEAD]
September 25, 2000
EOTT Energy Partners, L.P.
1330 Post Oak Boulevard
Houston, Texas 77056
Gentlemen:
We have acted as counsel to EOTT Energy Partners, L.P., a Delaware
limited partnership (the "Partnership"), in connection with the offer and sale
of units representing limited partner interests in the Partnership (the "Common
Units") pursuant to a Registration Statement, as amended, on Form S-1 (the
"Registration Statement") originally filed with the Securities and Exchange
Commission under the Securities Act of 1933 on August 30, 2000. Capitalized
terms not defined herein shall have the meanings ascribed to them in the Amended
and Restated Agreement of Limited Partnership of EOTT Energy Partners, L.P. (the
"Partnership Agreement") filed as an exhibit to the Registration Statement.
The Partnership owns a 99% limited partner interest in EOTT Energy
Operating Limited Partnership ("EEOLP"), a Delaware limited partnership, which
in turn owns 99% limited partnership interests in each of EOTT Energy Pipeline
Limited Partnership ("EEPLP"), a Delaware limited partnership, and EOTT Energy
Canada Limited Partnership ("EECLP" and, together with EEOLP and EEPLP, the
"Operating Limited Partnerships"), a Delaware limited partnership. EOTT Energy
Corp., (the "General Partner") a Delaware corporation, owns a 1% general partner
interest in the Partnership and a 1% general partner interest in each of the
Operating Limited Partnerships. Unless the context otherwise requires,
references to Partnership are references to both the Partnership and the
Operating Limited Partnerships.
You have requested our opinion that (i) each of the Partnership and the
Operating Limited Partnerships will be classified as a partnership for federal
income tax purposes and (ii) each beneficial owner of Common Units will be
treated as a partner of the Partnership for federal income tax purposes. In
addition, you have asked us to review the description of the principal federal
income tax consequences that should arise from the purchase, ownership and
disposition of Common Units found in the "Tax Considerations" section of the
Registration Statement.
In connection with the foregoing request, the Partnership and the
General Partner have made the following representations with respect to the
Partnership and the Operating Limited Partnerships:
(a) Neither the Partnership nor any of the Operating Limited
Partnerships has elected or will elect to be treated as an association
taxable as a corporation;
(b) Except as otherwise required by section 704 of the Code
and regulations promulgated thereunder, the General Partner has had and
will have, in the aggregate, an
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interest in each material item of income, gain, loss, deduction or
credit of the Partnership equal to at least 1% at all times during the
existence of the Partnership;
(c) The General Partner has and will maintain, in the
aggregate, a minimum capital account balance in the Partnership equal
to 1% of the total positive capital account balances of the
Partnership;
(d) For each taxable year, less than 10% of the gross income
of the Partnership will be derived from sources other than (i) the
exploration, development, mining or production, processing, refining,
transportation or marketing of any mineral or natural resource
including oil, gas or products thereof, and naturally occurring carbon
dioxide or (ii) other items of income as to which we have opined or
will opine will be "qualifying income" within the meaning of section
7704(d) of the Code; and
(e) The Partnership and each of the Operating Limited
Partnerships has been and will continue to be operated in accordance
with (i) all applicable partnership statutes, (ii) its respective
partnership agreement, and (iii) its description in the Registration
Statement.
Based upon the foregoing representations and covenants, the General
Partner's continued participation (or the participation of another party
satisfying the foregoing representations and covenants) as general partner of
the Partnership and the Code, existing regulations thereunder, published rulings
and judicial decisions currently outstanding, it is our opinion that (i) each of
the Partnership and the Operating Limited Partnerships will be classified as a
partnership for federal income tax purposes, and (ii) each beneficial owner of
Common Units will be treated as a partner of the Partnership for federal income
tax purposes. As used in this opinion, the term "beneficial owner of Common
Units" refers to (a) the assignees of Common Units who have executed and
delivered Transfer Applications and are awaiting admission as limited partners,
and (b) unitholders whose Common Units are held in street name or by nominee and
who have the right to direct the nominee in the exercise of all substantive
rights attendant to the ownership of their Common Units.
In addition, we have reviewed the description of the principal federal
income tax consequences of the purchase, ownership and disposition of Common
Units contained in the "Tax Considerations" section of the Registration
Statement and, except as otherwise noted therein, all statements contained in
such description relating to matters of law and legal conclusions reflect our
opinion.
Finally, based on our review of the Registration Statement, we have
concluded that the "Tax Considerations" section of the Registration Statement
addresses all material tax consequences to unitholders who are individual
citizens or residents of the United States.
We are rendering this opinion as of the time the Registration Statement
becomes effective. We hereby consent to the use of our name in the Registration
Statement and to the filing of this opinion as an exhibit to the Registration
Statement. This consent does not constitute an admission that we are "experts"
within the meaning of such term as used in the Securities Act of 1933.
/s/ Vinson & Elkins L.L.P.
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