Property, Plant and Equipment and Intangible Assets


	December 31, 2022			December 31, 2021			Estimated Useful Lives (In Years)
Gathering systems	$	10,403.1		$	9,318.2		5 to 20
Processing and fractionation facilities		7,421.2			6,388.8		5 to 25
Terminaling and storage facilities		1,341.6			1,313.8		5 to 25
Transportation assets		2,919.3			2,671.0		10 to 50
Other property, plant and equipment		387.6			340.9		3 to 50
Land		163.3			160.8		—
Construction in progress		1,011.0			347.0		—
Finance lease right-of-use assets		266.1			55.6		5 to 14
Property, plant and equipment		23,913.2			20,596.1
Accumulated depreciation, amortization and impairment		(9,698.6	)		(8,928.4	)
Property, plant and equipment, net	$	14,214.6		$	11,667.7

Intangible assets		4,379.7			2,642.9		10 to 20
Accumulated amortization and impairment		(1,645.1	)		(1,548.1	)
Intangible assets, net	$	2,734.6		$	1,094.8

During the preparation of the Company's 2020 consolidated financial statements, the Company identified certain gathering pipelines that should not have had value ascribed to them as part of a prior acquisition as these assets were inactive. The Company does not believe this error is material to its previously issued historical consolidated financial statements for any of the periods impacted and accordingly, has not adjusted the historical financial statements. The Company wrote these assets down in 2020 and recognized a non-cash loss of $32.4 million in Other operating (income) expense in our Consolidated Statements of Operations.

For each of the years ended December 31, 2022, 2021 and 2020 depreciation expense was $853.8 million, $739.6 million and $721.1 million, respectively.

Intangible assets consist of customer relationships acquired in the Delaware Basin Acquisition, and customer contracts and customer relationships acquired in prior business combinations. The fair value of these acquired intangible assets were determined at the date of acquisition based on the present values of estimated future cash flows. Amortization expense attributable to these assets is recorded over the periods in which we benefit from services provided to customers.

For each of the years ended December 31, 2022, 2021 and 2020, amortization expense for our intangible assets was $242.2 million, $131.0 million and $144.0 million, respectively. The estimated annual amortization expense for intangible assets is approximately $384.0 million, $373.2 million, $326.0 million, $279.8 million and $252.2 million for each of the years 2023 through 2027. As of December 31, 2022, the weighted average amortization period for our intangible assets was approximately 12.4 years.

The changes in our intangible assets are as follows:


	December 31, 2022			December 31, 2021
Balance at beginning of period	$	1,094.8		$	1,382.4
Additions from Delaware Basin Acquisition		1,882.0			—
Impairment		—			(156.6	)
Amortization		(242.2	)		(131.0	)
Balance at end of period	$	2,734.6		$	1,094.8

We review and evaluate our long-lived assets, including intangible assets, for impairment when events or changes in circumstances indicate that the related carrying amount of such assets may not be recoverable, including changes to our estimates that could have an impact on our assessment of asset recoverability.

In the fourth quarter of 2021, we recorded a non-cash pre-tax impairment charge of $452.3 million, comprised of $295.7 million for the impairment of certain gas processing facilities and gathering systems, and $156.6 million related to the impairment of intangible customer relationships associated with our Central operations in the Gathering and Processing segment. The impairment was a result of our assessment that forecasted undiscounted future net cash flows from operations, while positive, will not be sufficient to recover the existing total net book value of the underlying assets. Underlying our assessment were lower expectations regarding volumes and rates associated with the renewal of future expiring contracts and negotiation of new contracts in the South Texas region.

In the first quarter of 2020, we recorded a non-cash pre-tax impairment charge of $2,442.8 million, comprised of $2,234.2 million related to the impairment of certain gas processing facilities and gathering systems associated with our Central operations and our Coastal operations in the Gathering and Processing segment, and $208.6 million related to the impairment of intangible customer relationships associated with our Central operations in the Gathering and Processing segment. The impairment was a result of our assessment that forecasted undiscounted future net cash flows from operations, while positive, will not be sufficient to recover the existing total net book value of the underlying assets. Underlying our assessment was an observed global commodity price decline due to factors that significantly impacted both demand and supply. As the COVID-19 pandemic spread, causing travel and other restrictions to be implemented globally, the demand for commodities declined. Additionally, the supply shock late in the first quarter of 2020 from certain major oil producing nations increasing production also significantly contributed to the sharp drop in commodity prices. The drop in commodity prices resulted in prompt reactions from some domestic producers, including significantly reducing capital budgets and resultant drilling activity and shutting-in production. Our impairment assessment forecasted continued decline in natural gas production across the Mid-Continent and Gulf of Mexico regions.

For the 2021 and 2020 impairment assessments discussed above, we determined fair value through the use of discounted estimated cash flows to measure the impairment loss for each asset group for which undiscounted future net cash flows were not sufficient to recover the net book value.

The estimated cash flows used to assess recoverability of our long-lived assets and measure fair value of our asset groups are derived from current business plans, which are developed using near-term price and volume projections reflective of the current environment and management's projections for long-term average prices and volumes. In addition to near and long-term price assumptions, other key assumptions include volume projections, operating costs, timing of incurring such costs, and the use of an appropriate terminal value and discount rate. We believe our estimates and models used to determine fair value are similar to what a market participant would use.

The fair value measurement of our long-lived assets was based, in part, on significant inputs not observable in the market (as discussed above) and thus represents a Level 3 measurement. The significant unobservable inputs used include discount rates and determination of terminal values. We utilized a weighted average discount rate of 9.5% and 14.0% when deriving the fair value of the asset groups impaired during 2021 and 2020, respectively. The weighted average discount rate and terminal values reflect management’s best estimate of inputs a market participant would utilize. The carrying value adjustments are included in Impairment of long-lived assets in our Consolidated Statements of Operations.

We may identify additional triggering events in the future, which will require additional evaluations of the recoverability of the carrying value of our long-lived assets and may result in future impairments.