Organization and Summary of Significant Agreement

12 Months Ended

Dec. 31, 2012

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Organization and Summary of Significant Agreements

CROSSTEX ENERGY,INC.

Notes to Consolidated Financial Statements

December 31, 2012 and 2011

(1)Organization and Summary of Significant Agreements

(a)Description of Business

Crosstex Energy, Inc., a Delaware corporation formed on April 28, 2000, is engaged, through its subsidiaries, in providing midstream energy services, including gathering, processing, transmission and marketing, to producers of natural gas, NGLs and crude oil. The Company also provides crude oil, condensate and brine water services to producers. The Company connects the wells of natural gas producers in its market areas to its gathering systems, processes natural gas for the removal of NGLs, fractionates NGLs into purity products and markets those products for a fee, transports natural gas and ultimately provides natural gas to a variety of markets. The Company purchases natural gas from natural gas producers and other supply sources and sells that natural gas to utilities, industrial consumers, other marketers and pipelines. The Company operates processing plants that process gas transported to the plants by major interstate pipelines or from its own gathering systems under a variety of fee arrangements. In addition, the Company purchases natural gas from producers not connected to its gathering systems for resale and sells natural gas on behalf of producers for a fee. The Company provides a variety of crude services throughout the Ohio River Valley (ORV) which include crude oil gathering via pipelines and trucks and oilfield brine disposal. The Company also has crude oil terminal facilities in south Louisiana that provide access for crude oil producers to the premium markets in this area. The Company's gas gathering systems consist of networks of pipelines that collect natural gas from points near producing wells and transport it to larger pipelines for further transmission. The Company's transmission pipelines primarily receive natural gas from its gathering systems and from third party gathering and transmission systems and deliver natural gas to industrial end-users, utilities and other pipelines. The Company's oil gathering and transmission systems consist of trucking facilities, pipelines and barges that, in exchange for a fee, transport oil from a producer site to an end user. The Company's processing plants remove NGLs and CO2 from a natural gas stream and its fractionators separate the NGLs into separate NGL products, including ethane, propane, iso-butane, normal butanes and natural gasoline.

(b) Organization

On July 12, 2002, the Company formed Crosstex Energy, L.P. (herein referred to as the Partnership or CELP), a Delaware limited partnership. Crosstex Energy GP, LLC, a wholly owned subsidiary of the Company, is the general partner of the Partnership. As of December 31, 2012, the Company owned16,414,830common units in the Partnership through its wholly owned subsidiary, which represented 19.7% (17.3% effective following the Partnership's January 2013 equity offerings) of the limited partner interests in the Partnership and a1.9% (1.6% effective following the Partnership's January 2013 offerings) general partner interest. On September 13, 2012, the board of directors of the general partner amended the partnership agreement to convert the general partner's obligation to make capital contributions to the Partnership to maintain its 2% interest in connection with the issuance of additional limited interests by the Partnership to an option of the general partner to make future capital contributions to maintain its then current general partner percentage interest.

(c) Basis of Presentation

The accompanying consolidated financial statements include the assets, liabilities and results of operations of the Company and its wholly-owned subsidiaries, including the Partnership. The Partnership proportionately consolidates its undivided 50.0% interest in a gas processing plant located in the Permian Basin and its undivided 64.29% interest in a gas plant located in south Louisiana. The Company also consolidates its majority interest in Crosstex DC Gathering, J.V. (CDC), until October 2012 when it acquired the remaining interest for $0.4 million. The consolidated operations are hereafter referred to collectively as the “Company.” All material intercompany balances and transactions have been eliminated.

The weighted average amortization period for intangible assets is 18.0 years. Amortization expense for intangibles was approximately $64.1million, $47.5million and $35.9million for the years ended December 31, 2012, 2011 and 2010, respectively.

The following table summarizes the Company's estimated aggregate amortization expense for the next five years (in thousands):