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Segment Information
 6 Months Ended
Jun. 30, 2020
Segment Reporting [Abstract]  
Segment Information

Note 17 — Segment Information

 

We operate in two primary segments: (i) Gathering and Processing, and (ii) Logistics and Transportation (also referred to as the Downstream Business). Our reportable segments include operating segments that have been aggregated based on the nature of the products and services provided.

 

Our Gathering and Processing segment includes assets used in the gathering of natural gas produced from oil and gas wells and processing this raw natural gas into merchantable natural gas by extracting NGLs and removing impurities; and assets used for crude oil gathering and terminaling. The Gathering and Processing segment's assets are located in the Permian Basin of West Texas and Southeast New Mexico (including the Midland, Central and Delaware Basins); the Eagle Ford Shale in South Texas; the Barnett Shale in North Texas; the Anadarko, Ardmore, and Arkoma Basins in Oklahoma (including the SCOOP and STACK) and South Central Kansas; the Williston Basin in North Dakota (including the Bakken and Three Forks plays); and the onshore and near offshore regions of the Louisiana Gulf Coast and the Gulf of Mexico.

 

Our Logistics and Transportation segment includes the activities and assets necessary to convert mixed NGLs into NGL products and also includes other assets and value-added services such as transporting, storing, fractionating, terminaling and marketing of NGLs and NGL products, including services to LPG exporters; and certain natural gas supply and marketing activities in support of our other

businesses. The Logistics and Transportation segment also includes the Grand Prix NGL pipeline (“Grand Prix”), which connects our gathering and processing positions in the Permian Basin, Southern Oklahoma and North Texas with our downstream facilities in Mont Belvieu, Texas. The associated assets are generally connected to and supplied in part by our Gathering and Processing segment and, except for pipelines and smaller terminals, are located predominantly in Mont Belvieu and Galena Park, Texas, and in Lake Charles, Louisiana.

 

Other contains the mark-to-market gains/losses related to derivative contracts that were not designated as cash flow hedges. Elimination of inter-segment transactions are reflected in the corporate and eliminations column.

 

Reportable segment information is shown in the following tables:

 

 

 

Three Months Ended June 30, 2020

 

 

 

Gathering and Processing

 

 

Logistics and Transportation

 

 

Other

 

 

Corporate

and

Eliminations

 

 

Total

 

Revenues

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales of commodities

 

$

133.5

 

 

$

1,136.3

 

 

$

10.8

 

 

$

—

 

 

$

1,280.6

 

Fees from midstream services

 

 

110.0

 

 

 

132.9

 

 

 

—

 

 

 

—

 

 

 

242.9

 

 

 

 

243.5

 

 

 

1,269.2

 

 

 

10.8

 

 

 

—

 

 

 

1,523.5

 

Intersegment revenues

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales of commodities

 

 

389.2

 

 

 

46.1

 

 

 

—

 

 

 

(435.3

)

 

 

—

 

Fees from midstream services

 

 

1.5

 

 

 

7.3

 

 

 

—

 

 

 

(8.8

)

 

 

—

 

 

 

 

390.7

 

 

 

53.4

 

 

 

—

 

 

 

(444.1

)

 

 

—

 

Revenues

 

$

634.2

 

 

$

1,322.6

 

 

$

10.8

 

 

$

(444.1

)

 

$

1,523.5

 

Operating margin

 

$

237.2

 

 

$

231.5

 

 

$

10.8

 

 

$

—

 

 

$

479.5

 

Other financial information:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total assets (1)

 

$

9,124.2

 

 

$

6,697.2

 

 

$

22.0

 

 

$

122.0

 

 

$

15,965.4

 

Goodwill

 

$

45.2

 

 

$

—

 

 

$

—

 

 

$

—

 

 

$

45.2

 

Capital expenditures

 

$

37.1

 

 

$

127.9

 

 

$

—

 

 

$

4.6

 

 

$

169.6

 

 

 

(1)

Assets in the Corporate and Eliminations column primarily include tax-related assets, cash, prepaids and debt issuance costs for our revolving credit facilities.

 

 

 

Three Months Ended June 30, 2019

 

 

 

Gathering and Processing

 

 

Logistics and Transportation

 

 

Other

 

 

Corporate

and

Eliminations

 

 

Total

 

Revenues

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales of commodities

 

$

298.4

 

 

$

1,378.8

 

 

$

7.0

 

 

$

—

 

 

$

1,684.2

 

Fees from midstream services

 

 

176.2

 

 

 

134.9

 

 

 

—

 

 

 

—

 

 

 

311.1

 

 

 

 

474.6

 

 

 

1,513.7

 

 

 

7.0

 

 

 

—

 

 

 

1,995.3

 

Intersegment revenues

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales of commodities

 

 

539.7

 

 

 

43.6

 

 

 

—

 

 

 

(583.3

)

 

 

—

 

Fees from midstream services

 

 

1.5

 

 

 

7.0

 

 

 

—

 

 

 

(8.5

)

 

 

—

 

 

 

 

541.2

 

 

 

50.6

 

 

 

—

 

 

 

(591.8

)

 

 

—

 

Revenues

 

$

1,015.8

 

 

$

1,564.3

 

 

$

7.0

 

 

$

(591.8

)

 

$

1,995.3

 

Operating margin

 

$

232.1

 

 

$

184.4

 

 

$

7.0

 

 

$

—

 

 

$

423.5

 

Other financial information:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total assets (1)

 

$

12,144.4

 

 

$

5,994.7

 

 

$

19.0

 

 

$

160.1

 

 

$

18,318.2

 

Goodwill

 

$

46.6

 

 

$

—

 

 

$

—

 

 

$

—

 

 

$

46.6

 

Capital expenditures

 

$

420.8

 

 

$

425.5

 

 

$

—

 

 

$

10.8

 

 

$

857.1

 

 

(1)

Assets in the Corporate and Eliminations column primarily include tax-related assets, cash, prepaids and debt issuance costs for our revolving credit facilities.

 

 

 

Six Months Ended June 30, 2020

 

 

 

Gathering and Processing

 

 

Logistics and Transportation

 

 

Other

 

 

Corporate

and

Eliminations

 

 

Total

 

Revenues

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales of commodities

 

$

377.3

 

 

$

2,555.7

 

 

$

127.2

 

 

$

—

 

 

$

3,060.2

 

Fees from midstream services

 

 

228.2

 

 

 

284.0

 

 

 

—

 

 

 

—

 

 

 

512.2

 

 

 

 

605.5

 

 

 

2,839.7

 

 

 

127.2

 

 

 

—

 

 

 

3,572.4

 

Intersegment revenues

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales of commodities

 

 

832.4

 

 

 

102.7

 

 

 

—

 

 

 

(935.1

)

 

 

—

 

Fees from midstream services

 

 

3.3

 

 

 

15.4

 

 

 

—

 

 

 

(18.7

)

 

 

—

 

 

 

 

835.7

 

 

 

118.1

 

 

 

—

 

 

 

(953.8

)

 

 

—

 

Revenues

 

$

1,441.2

 

 

$

2,957.8

 

 

$

127.2

 

 

$

(953.8

)

 

$

3,572.4

 

Operating margin

 

$

492.8

 

 

$

525.5

 

 

$

127.2

 

 

$

—

 

 

$

1,145.5

 

Other financial information:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total assets (1)

 

$

9,124.2

 

 

$

6,697.2

 

 

$

22.0

 

 

$

122.0

 

 

$

15,965.4

 

Goodwill

 

$

45.2

 

 

$

—

 

 

$

—

 

 

$

—

 

 

$

45.2

 

Capital expenditures

 

$

154.6

 

 

$

306.3

 

 

$

—

 

 

$

12.9

 

 

$

473.8

 

 

(1)

Assets in the Corporate and Eliminations column primarily include tax-related assets, cash, prepaids and debt issuance costs for our revolving credit facilities.

 

 

 

Six Months Ended June 30, 2019

 

 

 

Gathering and Processing

 

 

Logistics and Transportation

 

 

Other

 

 

Corporate

and

Eliminations

 

 

Total

 

Revenues

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales of commodities

 

$

555.1

 

 

$

3,105.6

 

 

$

—

 

 

$

—

 

 

$

3,660.7

 

Fees from midstream services

 

 

376.1

 

 

 

257.9

 

 

 

—

 

 

 

—

 

 

 

634.0

 

 

 

 

931.2

 

 

 

3,363.5

 

 

 

—

 

 

 

—

 

 

 

4,294.7

 

Intersegment revenues

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales of commodities

 

 

1,362.5

 

 

 

82.1

 

 

 

—

 

 

 

(1,444.6

)

 

 

—

 

Fees from midstream services

 

 

3.3

 

 

 

12.5

 

 

 

—

 

 

 

(15.8

)

 

 

—

 

 

 

 

1,365.8

 

 

 

94.6

 

 

 

—

 

 

 

(1,460.4

)

 

 

—

 

Revenues

 

$

2,297.0

 

 

$

3,458.1

 

 

$

—

 

 

$

(1,460.4

)

 

$

4,294.7

 

Operating margin

 

$

470.3

 

 

$

336.3

 

 

$

—

 

 

$

—

 

 

$

806.6

 

Other financial information:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total assets (1)

 

$

12,144.4

 

 

$

5,994.7

 

 

$

19.0

 

 

$

160.1

 

 

$

18,318.2

 

Goodwill

 

$

46.6

 

 

$

—

 

 

$

—

 

 

$

—

 

 

$

46.6

 

Capital expenditures

 

$

838.5

 

 

$

896.3

 

 

$

—

 

 

$

27.8

 

 

$

1,762.6

 

 

(1)

Assets in the Corporate and Eliminations column primarily include tax-related assets, cash, prepaids and debt issuance costs for our revolving credit facilities.

 

The following table shows our consolidated revenues disaggregated by product and service for the periods presented:

 

 

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

Sales of commodities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue recognized from contracts with customers:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Natural gas

 

$

269.7

 

 

$

217.6

 

 

$

542.8

 

 

$

628.9

 

NGL

 

 

908.2

 

 

 

1,195.5

 

 

 

2,069.5

 

 

 

2,591.9

 

Condensate and crude oil

 

 

27.6

 

 

 

172.1

 

 

 

163.3

 

 

 

309.8

 

Petroleum products

 

 

6.8

 

 

 

56.8

 

 

 

56.5

 

 

 

76.0

 

 

 

 

1,212.3

 

 

 

1,642.0

 

 

 

2,832.1

 

 

 

3,606.6

 

Non-customer revenue:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Derivative activities - Hedge

 

 

60.2

 

 

 

43.3

 

 

 

120.3

 

 

 

64.6

 

Derivative activities - Non-hedge (1)

 

 

8.1

 

 

 

(1.1

)

 

 

107.8

 

 

 

(10.5

)

 

 

 

68.3

 

 

 

42.2

 

 

 

228.1

 

 

 

54.1

 

Total sales of commodities

 

 

1,280.6

 

 

 

1,684.2

 

 

 

3,060.2

 

 

 

3,660.7

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fees from midstream services:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue recognized from contracts with customers:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gathering and processing

 

 

107.4

 

 

 

177.5

 

 

 

223.3

 

 

 

371.9

 

NGL transportation, fractionation and services

 

 

32.9

 

 

 

40.1

 

 

 

72.8

 

 

 

76.3

 

Storage, terminaling and export

 

 

89.1

 

 

 

90.4

 

 

 

188.8

 

 

 

170.0

 

Other

 

 

13.5

 

 

 

3.1

 

 

 

27.3

 

 

 

15.8

 

Total fees from midstream services

 

 

242.9

 

 

 

311.1

 

 

 

512.2

 

 

 

634.0

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total revenues

 

$

1,523.5

 

 

$

1,995.3

 

 

$

3,572.4

 

 

$

4,294.7

 

 

 

(1)

Represents derivative activities that are not designated as hedging instruments under ASC 815.

 

The following table shows a reconciliation of reportable segment operating margin to income (loss) before income taxes for the periods presented: 

 

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

Reconciliation of reportable segment operating

margin to income (loss) before income taxes:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gathering and Processing operating margin

$

 

237.2

 

 

$

 

232.1

 

 

$

 

492.8

 

 

$

 

470.3

 

Logistics and Transportation operating margin

 

 

231.5

 

 

 

 

184.4

 

 

 

 

525.5

 

 

 

 

336.3

 

Other operating margin

 

 

10.8

 

 

 

 

7.0

 

 

 

 

127.2

 

 

 

 

—

 

Depreciation and amortization expense

 

 

(204.5

)

 

 

 

(237.2

)

 

 

 

(443.6

)

 

 

 

(474.6

)

General and administrative expense

 

 

(61.5

)

 

 

 

(72.8

)

 

 

 

(121.9

)

 

 

 

(153.6

)

Impairment of long-lived assets

 

 

—

 

 

 

 

—

 

 

 

 

(2,442.8

)

 

 

 

—

 

Interest expense, net

 

 

(96.7

)

 

 

 

(72.1

)

 

 

 

(194.7

)

 

 

 

(152.7

)

Equity earnings (loss)

 

 

14.9

 

 

 

 

3.2

 

 

 

 

35.5

 

 

 

 

5.9

 

Gain (loss) on sale or disposition of business and assets

 

 

0.7

 

 

 

 

0.2

 

 

 

 

—

 

 

 

 

(3.1

)

Gain (loss) from financing activities

 

 

21.8

 

 

 

 

—

 

 

 

 

61.1

 

 

 

 

(1.4

)

Change in contingent considerations

 

 

—

 

 

 

 

0.8

 

 

 

 

—

 

 

 

 

(8.9

)

Other, net

 

 

(0.3

)

 

 

 

—

 

 

 

 

(0.8

)

 

 

 

(0.2

)

Income (loss) before income taxes

$

 

153.9

 

 

$

 

45.6

 

 

$

 

(1,961.7

)

 

$

 

18.0