16. REPORTING SEGMENTS

“Midstream” and “Production” best describe the operating segments of the businesses that we separately report. The factors used to identify these reporting segments are based on the nature of the operations that are undertaken by each segment. The Midstream segment operates the gathering, processing and transportation of natural gas, NGLs and crude oil. The Production segment operates to produce crude oil and natural gas. These segments are broadly understood across the petroleum and petrochemical industries.

These functions have been defined as the operating segments of the Partnership because they are the segments (1) that engage in business activities from which revenues are earned and expenses are incurred; (2) whose operating results are regularly reviewed by the Partnership’s chief operating decision maker (“CODM”) to make decisions about resources to be allocated to the segment and to assess its performance; and (3) for which discrete financial information is available. Operating segments are evaluated for their contribution to the Partnership’s consolidated results based on operating income, which is defined as segment operating revenues less expenses.

The following tables present financial information for each operating segment for the periods indicated based on our operating segments (in thousands):


	Three Months Ended March 31,
	2020				2019
	Production		Midstream		Production		Midstream
Segment revenues
Natural gas sales	$	234	$	—	$	110	$	—
Oil sales		7,187		—		(739)		—
Natural gas liquid sales		31		—		179		—
Gathering and transportation sales		—		785		—		1,683
Gathering and transportation lease revenues		—		12,606		—		16,257
Total segment revenues		7,452		13,391		(450)		17,940

Segment operating costs
Lease operating expenses		1,858		51		1,319		396
Transportation operating expenses		—		2,558		—		2,676
Production taxes		106		—		183		—
Depreciation, depletion and amortization		772		5,143		1,095		5,334
Asset impairments		23,247		—		—		—
Accretion expense		52		86		54		79
Total segment operating costs		26,035		7,838		2,651		8,485

Segment other income
Earnings (losses) from equity investments		—		(1,202)		—		1,442
Total segment other income		—		(1,202)		—		1,442
Segment operating income (loss)	$	(18,583)	$	4,351	$	(3,101)	$	10,897


	Three Months Ended
	March 31,
	2020		2019
Reconciliation of segment operating income (loss) to net loss
Total production operating loss	$	(18,583)	$	(3,101)
Total midstream operating income		4,351		10,897
Total segment operating income (loss)		(14,232)		7,796

General and administrative expense		(3,775)		(4,749)
Unit-based compensation expense		(398)		(635)
Interest expense, net		(23,009)		(2,786)
Other income		—		46
Income tax benefit (expense)		73		(46)
Net loss	$	(41,341)	$	(374)

The following table summarizes the total assets by operating segment as of March 31, 2020 and December 31, 2019 and total capital expenditures for the three months ended March 31, 2020 and the year ended December 31, 2019 (in thousands):


	March 31, 2020
	Production		Midstream		Corporate (a)		Total
Other financial information
Total assets	$	24,243	$	356,635	$	2,905	$	383,783
Capital expenditures(b)	$	(5)	$	121	$	—	$	116


	December 31, 2019
	Production		Midstream		Corporate (a)		Total
Other financial information
Total assets	$	45,550	$	362,961	$	5,929	$	414,440
Capital expenditures(b)	$	130	$	775	$	—	$	905

(a)

Corporate assets not reviewed by the CODM on a segment basis consists of cash, certain prepaid expenses, office furniture, and other assets.

(b)

Inclusive of capital contributions made to equity method investments.