(16) Segment Information

See Note 2(t) for a description of the Company’s determination of its reportable segments. Revenues from gathering and processing and water handling and treatment operations are primarily derived from intersegment transactions for services provided to the Company’s exploration and production operations. Marketing revenues are primarily derived from activities to purchase and sell third-party natural gas and NGLs and to market excess firm transportation capacity to third parties.

Operating segments are evaluated based on their contribution to consolidated results, which is primarily determined by the respective operating income of each segment. General and administrative expenses are allocated to the gathering and processing and water handling and treatment segments based on the nature of the expenses and on a combination of the segments’ proportionate share of the Company’s consolidated property and equipment, capital expenditures, and labor costs, as applicable. General and administrative expenses related to the marketing segment are not allocated because they are immaterial. Other income, income taxes, and interest expense are primarily managed and evaluated on a consolidated basis. Intersegment sales are transacted at prices which approximate market. Accounting policies for each segment as described in Note 2 to the consolidated financial statements.

The operating results and assets of the Company’s reportable segments were as follows for the years ended December 31, 2016, 2017, and 2018 (in thousands):


	Exploration and production		Gathering and processing	Water handling and treatment	Marketing	Elimination of intersegment transactions	Consolidated total
Year ended December 31, 2016:
Sales and revenues:
Third-party	$	1,334,656	16,028	792	393,049	—	1,744,525
Intersegment		18,324	291,916	281,475	—	(591,715)	—
Total	$	1,352,980	307,944	282,267	393,049	(591,715)	1,744,525

Operating expenses:
Lease operating	$	50,651	—	136,386	—	(136,947)	50,090
Gathering, compression, processing, and transportation		1,146,221	28,098	—	—	(291,481)	882,838
Depletion, depreciation, and amortization		709,127	70,847	29,899	—	—	809,873
General and administrative		186,672	39,832	14,331	—	(1,511)	239,324
Other		241,755	(809)	14,401	499,343	(16,489)	738,201
Total		2,334,426	137,968	195,017	499,343	(446,428)	2,720,326
Operating income (loss)	$	(981,446)	169,976	87,250	(106,294)	(145,287)	(975,801)
Equity in earnings of unconsolidated affiliates	$	—	485	—	—	—	485
Segment assets	$	12,512,973	1,750,354	615,687	37,890	(661,354)	14,255,550
Capital expenditures for segment assets	$	2,220,688	231,044	188,188	—	(144,491)	2,495,429


	Exploration and production		Gathering and processing	Water handling and treatment	Marketing	Elimination of intersegment transactions	Consolidated total
Year ended December 31, 2017:
Sales and revenues:
Third-party	$	3,406,203	11,386	1,334	236,651	—	3,655,574
Intersegment		17,358	385,080	374,697	—	(777,135)	—
Total	$	3,423,561	396,466	376,031	236,651	(777,135)	3,655,574

Operating expenses:
Lease operating	$	93,758	—	189,702	—	(194,403)	89,057
Gathering, compression, processing, and transportation		1,441,129	39,147	—	—	(384,637)	1,095,639
Depletion, depreciation, and amortization		704,152	87,268	33,190	—	—	824,610
General and administrative		195,153	40,337	18,475	—	(2,769)	251,196
Other		261,578	23,535	17,061	366,281	(13,476)	654,979
Total		2,695,770	190,287	258,428	366,281	(595,285)	2,915,481
Operating income (loss)	$	727,791	206,179	117,603	(129,630)	(181,850)	740,093
Equity in earnings of unconsolidated affiliates	$	—	20,194	—	—	—	20,194
Segment assets	$	13,074,027	2,253,163	804,296	36,701	(906,697)	15,261,490
Capital expenditures for segment assets	$	1,859,481	346,217	194,502	—	(183,447)	2,216,753


	Exploration and production		Gathering and processing	Water handling and treatment	Marketing	Elimination of intersegment transactions	Consolidated total
Year ended December 31, 2018:
Sales and revenues:
Third-party	$	3,565,300	17,817	3,527	552,982	—	4,139,626
Intersegment		(87,472)	503,332	503,846	—	(919,706)	—
Total	$	3,477,828	521,149	507,373	552,982	(919,706)	4,139,626

Operating expenses:
Lease operating	$	142,234	—	262,704	—	(268,785)	136,153
Gathering, compression, processing, and transportation		1,792,898	48,998	552	—	(503,090)	1,339,358
Impairment of unproved properties		549,437	—	—	—	—	549,437
Impairment of gathering systems and facilities		—	9,658	—	—	—	9,658
Depletion, depreciation, and amortization		841,645	84,057	46,763	—	—	972,465
General and administrative		181,305	46,609	15,020	—	(2,590)	240,344
Other		129,947	258	(88,973)	686,055	93,019	820,306
Total		3,637,466	189,580	236,066	686,055	(681,446)	4,067,721
Operating income (loss)	$	(159,638)	331,569	271,307	(133,073)	(238,260)	71,905
Equity in earnings of unconsolidated affiliates	$	—	40,280	—	—	—	40,280
Segment assets	$	12,986,945	2,465,858	1,077,004	34,499	(1,044,842)	15,519,464
Capital expenditures for segment assets	$	1,923,488	444,413	97,699	—	(255,014)	2,210,586