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Business Segment Information
 12 Months Ended
Dec. 31, 2013
Segment Reporting [Abstract]  
Business Segment Information
12. Business Segment Information
Our operations consist of three operating segments:
•
Pipeline Transportation – interstate, intrastate and offshore crude oil, and to a lesser extent, CO2;
•
Refinery Services – processing high sulfur (or “sour”) gas streams as part of refining operations to remove the sulfur and selling the related by-product, NaHS and;
•
Supply and Logistics – terminaling, blending, storing, marketing, and transporting crude oil and petroleum products (primarily fuel oil, asphalt, and other heavy refined products) and, on a smaller scale, CO2.
Substantially all of our revenues are derived from, and substantially all of our assets are located in, the United States.
We define Segment Margin as revenues less product costs, operating expenses (excluding non-cash charges, such as depreciation and amortization), and segment general and administrative expenses, plus our equity in distributable cash generated by our equity investees. In addition, our Segment Margin definition excludes the non-cash effects of our legacy stock appreciation rights plan and includes the non-income portion of payments received under direct financing leases.
Our chief operating decision maker (our Chief Executive Officer) evaluates segment performance based on a variety of measures including Segment Margin, segment volumes, where relevant, and capital investment.
Segment information for each year presented below is as follows:
 
Pipeline
Transportation
 
Refinery
Services
 
Supply &
Logistics(a)
 
Total
Year Ended December 31, 2013
 
 
 
 
 
 
 
Segment Margin (b)
$
108,879

 
$
75,361

 
$
96,120

 
$
280,360

Capital expenditures (c)
$
225,073

 
$
3,258

 
$
475,874

 
$
704,205

Revenues:
 
 
 
 
 
 
 
External customers
$
69,375

 
$
216,860

 
$
3,848,595

 
$
4,134,830

Intersegment (d)
17,133

 
(10,875
)
 
(6,258
)
 
—

Total revenues of reportable segments
$
86,508

 
$
205,985

 
$
3,842,337

 
$
4,134,830

Year Ended December 31, 2012
 
 
 
 
 
 
 
Segment Margin (b)
$
96,539

 
$
72,883

 
$
92,911

 
$
262,333

Capital expenditures (c)
$
328,710

 
$
2,692

 
$
94,896

 
$
426,298

Revenues:
 
 
 
 
 
 
 
External customers
$
61,706

 
$
205,110

 
$
3,100,545

 
$
3,367,361

Intersegment (d)
14,584

 
(9,093
)
 
(5,491
)
 
—

Total revenues of reportable segments
$
76,290

 
$
196,017

 
$
3,095,054

 
$
3,367,361

Year Ended December 31, 2011
 
 
 
 
 
 
 
Segment Margin (b)
$
67,908

 
$
74,618

 
$
59,975

 
$
202,501

Capital expenditures (c)
$
14,501

 
$
1,846

 
$
170,647

 
$
186,994

Revenues:
 
 
 
 
 
 
 
External customers
$
50,391

 
$
210,394

 
$
2,177,012

 
$
2,437,797

Intersegment (d)
11,799

 
(8,683
)
 
(3,116
)
 
—

Total revenues of reportable segments
$
62,190

 
$
201,711

 
$
2,173,896

 
$
2,437,797

Total assets by reportable segment were as follows:
 
December 31, 2013
 
December 31, 2012
 
December 31, 2011
Pipeline transportation
$
1,075,235

 
$
890,652

 
$
594,728

Refinery services
417,121

 
414,170

 
426,993

Supply and logistics
1,312,461

 
750,347

 
658,393

Other assets
57,385

 
54,495

 
50,730

Total consolidated assets
$
2,862,202

 
$
2,109,664

 
$
1,730,844


(a)
Discontinued operations are included in Segment Margin but excluded from revenues for all periods presented.
(b)
A reconciliation of Segment Margin to income from continuing operations before income taxes for each year presented is as follows:
 
Year Ended December 31,
 
2013
 
2012
 
2011
Segment Margin
$
280,360

 
$
262,333

 
$
202,501

Corporate general and administrative expenses
(43,353
)
 
(38,372
)
 
(31,685
)
Depreciation and amortization
(64,784
)
 
(61,150
)
 
(62,161
)
Interest expense
(48,583
)
 
(40,923
)
 
(35,771
)
Distributable cash from equity investees in excess of equity in earnings
(23,889
)
 
(24,464
)
 
(16,681
)
Non-cash items not included in Segment Margin
(7,551
)
 
(5,280
)
 
(1,531
)
Cash payments from direct financing leases in excess of earnings
(5,110
)
 
(5,016
)
 
(4,615
)
Discontinued operations
(2,241
)
 
1,004

 
97

Income from continuing operations before income taxes
$
84,849

 
$
88,132

 
$
50,154


(c) Capital expenditures include maintenance and growth capital expenditures, such as fixed asset additions (including enhancements to existing facilities and construction of internal growth projects) as well as acquisitions of businesses and interests in equity investees. In addition to construction of internal growth projects, capital spending in our pipeline transportation segment included $94.3 million and $63.7 million during the years ended December 31, 2013 and December 31, 2012 representing capital contributions to our SEKCO equity investee to fund our share of the construction costs for its pipeline. During 2013, capital spending in our supply and logistics segment also included $230.9 million for the acquisition of our offshore marine transportation assets. During 2012, capital spending in our pipeline transportation segment also included $205.6 million for the acquisition of interests in several Gulf of Mexico pipelines.
(d) Intersegment sales were conducted under terms that we believe were no more or less favorable than then-existing market conditions.