Question-and-Answer Session
Operator
(Operator Instructions). Your first question comes from Michael Blum - Wells Fargo.
Michael Blum - Wells Fargo
Few questions. First, Stephen can you just walk through on the Preferred Units, what was just, specifically what causes that change in value that most of the income statement?
Stephen L. Arata
Sure, it's little bit complex but it blows down to the fact that there are embedded call options in the security and those have to be mark-to-market every quarter. If you notice on our balance sheet that shows up just above our partner's capital in a separate category.
So, from a accounting perspective, it's treated as temporary equity but because of the accounting rules we have to follow, we have to flow through the change in the value of the options every quarter that are embedded within the actual security itself.
So, it is going to cause some ongoing volatility in our earnings stream effectively if our price of our underlined units goes up, we're going to have a charge and if the price of our underlined units goes down, we're going to have a gain. And there's some other minor impacts, some other items but that's going to be the biggest driver of whether we have a gain or a loss.
Michael Blum - Wells Fargo
And then in terms of the 2010 capital that you laid out there. Where generally are you spending that money?
Stephen L. Arata
A lot of that, well the vast majority of that is in our gathering and processing business. We have some capital in there for completion and packaging of some compression units. But the vast majority of it is to complete projects in North Louisiana and in South Texas.
Michael Blum - Wells Fargo
The last question for me is just in the compression business, can you talk about where utilization is and also, based on with the trends you are seeing do you feel like this -- you've seen the bottom in that business and you are going to see a trend up from here or where do you see that going?
Stephen L. Arata
Michael obviously as seen, utilization rates come down when you go back and look at the chart on page 10 down to 743.
That seemed to have levelized and seemed to have stabilized. With a couple of things ongoing now, we think that it may actually come up a little bit before year end.
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