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Segment Information (Tables)

9 Months Ended

Sep. 30, 2023

We evaluate the performance of our operating segments based on segment profit and adjusted gross margin. Adjusted gross margin is a non-GAAP financial measure. See “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations—Non-GAAP Financial Measures” for additional information. Summarized financial information for our reportable segments is shown in the following tables (in millions):


	Permian		Louisiana		Oklahoma		North Texas		Corporate		Totals
Three Months Ended September 30, 2023
Natural gas sales	$	132.9	$	101.8	$	42.3	$	22.7	$	—	$	299.7
NGL sales	(4.8)		746.6		(2.0)		0.7		—		740.5
Crude oil and condensate sales	345.2		78.0		24.7		—		—		447.9

Product sales	473.3		926.4		65.0		23.4		—		1,488.1

NGL sales—related parties	247.4		5.3		126.0		78.7		(457.4)		—
Crude oil and condensate sales—related parties	—		—		—		2.3		(2.3)		—
Product sales—related parties	247.4		5.3		126.0		81.0		(459.7)		—
Gathering and transportation	30.5		19.5		60.5		49.8		—		160.3
Processing	15.3		0.5		36.2		29.9		—		81.9
NGL services	—		20.5		—		0.1		—		20.6
Crude services	5.6		5.7		3.7		0.1		—		15.1
Other services	1.7		0.2		0.1		0.2		—		2.2
Midstream services	53.1		46.4		100.5		80.1		—		280.1


NGL services—related parties	—		—		—		1.2		(1.2)		—


Midstream services—related parties	—		—		—		1.2		(1.2)		—
Revenue from contracts with customers	773.8		978.1		291.5		185.7		(460.9)		1,768.2
Realized gain (loss) on derivatives	(4.4)		—		0.9		4.4		—		0.9
Change in fair value of derivatives	(7.4)		(6.0)		(4.1)		(5.4)		—		(22.9)
Total revenues	762.0		972.1		288.3		184.7		(460.9)		1,746.2
Cost of sales, exclusive of operating expenses and depreciation and amortization	(604.3)		(850.0)		(157.1)		(94.2)		460.9		(1,244.7)
Adjusted gross margin	157.7		122.1		131.2		90.5		—		501.5
Operating expenses	(55.0)		(35.0)		(26.6)		(26.7)		—		(143.3)
Segment profit	102.7		87.1		104.6		63.8		—		358.2
Depreciation and amortization	(42.1)		(36.3)		(54.6)		(29.3)		(1.5)		(163.8)
Gross margin	60.6		50.8		50.0		34.5		(1.5)		194.4
Impairments	—		(20.7)		—		—		—		(20.7)
Gain on disposition of assets	—		—		0.5		0.1		—		0.6
General and administrative	—		—		—		—		(30.4)		(30.4)
Interest expense, net of interest income	—		—		—		—		(67.9)		(67.9)

Income from unconsolidated affiliate investments	—		—		—		—		1.0		1.0
Other expense	—		—		—		—		(0.6)		(0.6)
Income (loss) before non-controlling interest and income taxes	$	60.6	$	30.1	$	50.5	$	34.6	$	(99.4)	$	76.4
Capital expenditures	$	82.9	$	23.1	$	11.5	$	17.0	$	2.0	$	136.5


	Permian		Louisiana		Oklahoma		North Texas		Corporate		Totals
Three Months Ended September 30, 2022
Natural gas sales	$	361.6	$	383.8	$	114.5	$	42.8	$	—	$	902.7
NGL sales	0.2		1,067.4		1.7		1.4		—		1,070.7
Crude oil and condensate sales	280.7		97.0		33.3		—		—		411.0

Product sales	642.5		1,548.2		149.5		44.2		—		2,384.4

NGL sales—related parties	380.3		46.3		203.2		139.7		(769.5)		—
Crude oil and condensate sales—related parties	—		—		—		2.6		(2.6)		—
Product sales—related parties	380.3		46.3		203.2		142.3		(772.1)		—
Gathering and transportation	20.9		22.1		45.9		49.9		—		138.8
Processing	11.1		0.4		31.4		39.5		—		82.4
NGL services	—		19.5		—		0.1		—		19.6
Crude services	5.7		8.1		3.0		0.1		—		16.9
Other services	0.2		0.4		0.2		0.1		—		0.9
Midstream services	37.9		50.5		80.5		89.7		—		258.6




Other services—related parties	—		0.1		—		—		(0.1)		—
Midstream services—related parties	—		0.1		—		—		(0.1)		—
Revenue from contracts with customers	1,060.7		1,645.1		433.2		276.2		(772.2)		2,643.0
Realized gain (loss) on derivatives	1.3		3.3		0.6		(2.9)		—		2.3
Change in fair value of derivatives	2.4		4.0		9.5		2.3		—		18.2
Total revenues	1,064.4		1,652.4		443.3		275.6		(772.2)		2,663.5
Cost of sales, exclusive of operating expenses and depreciation and amortization	(903.3)		(1,517.8)		(315.3)		(166.9)		772.2		(2,131.1)
Adjusted gross margin	161.1		134.6		128.0		108.7		—		532.4
Operating expenses	(49.7)		(37.6)		(23.5)		(26.0)		—		(136.8)
Segment profit	111.4		97.0		104.5		82.7		—		395.6
Depreciation and amortization	(36.8)		(39.7)		(51.5)		(33.4)		(1.2)		(162.6)
Gross margin	74.6		57.3		53.0		49.3		(1.2)		233.0

Gain on disposition of assets	—		0.1		0.1		0.6		—		0.8
General and administrative	—		—		—		—		(34.5)		(34.5)
Interest expense, net of interest income	—		—		—		—		(60.4)		(60.4)
Loss on extinguishment of debt	—		—		—		—		(5.7)		(5.7)
Loss from unconsolidated affiliate investments	—		—		—		—		(1.7)		(1.7)
Other income	—		—		—		—		0.3		0.3
Income (loss) before non-controlling interest and income taxes	$	74.6	$	57.4	$	53.1	$	49.9	$	(103.2)	$	131.8

Capital expenditures	$	61.7	$	6.5	$	18.2	$	6.5	$	1.6	$	94.5


	Permian		Louisiana		Oklahoma		North Texas		Corporate		Totals
Nine Months Ended September 30, 2023
Natural gas sales	$	338.6	$	326.1	$	142.0	$	53.9	$	—	$	860.6
NGL sales	(4.4)		2,253.1		7.0		(2.2)		—		2,253.5
Crude oil and condensate sales	826.3		187.2		76.1		—		—		1,089.6

Product sales	1,160.5		2,766.4		225.1		51.7		—		4,203.7

NGL sales—related parties	689.0		15.0		346.3		224.4		(1,274.7)		—
Crude oil and condensate sales—related parties	—		—		—		7.8		(7.8)		—
Product sales—related parties	689.0		15.0		346.3		232.2		(1,282.5)		—
Gathering and transportation	83.1		58.2		175.8		153.8		—		470.9
Processing	43.8		0.9		107.9		92.5		—		245.1
NGL services	—		65.7		—		0.2		—		65.9
Crude services	18.6		17.8		13.1		0.5		—		50.0
Other services	5.0		0.9		0.4		0.7		—		7.0
Midstream services	150.5		143.5		297.2		247.7		—		838.9


NGL services—related parties	—		—		—		2.6		(2.6)		—


Midstream services—related parties	—		—		—		2.6		(2.6)		—
Revenue from contracts with customers	2,000.0		2,924.9		868.6		534.2		(1,285.1)		5,042.6
Realized gain (loss) on derivatives	(3.0)		(0.6)		4.8		19.0		—		20.2
Change in fair value of derivatives	(9.0)		3.2		(3.5)		(9.7)		—		(19.0)
Total revenues	1,988.0		2,927.5		869.9		543.5		(1,285.1)		5,043.8
Cost of sales, exclusive of operating expenses and depreciation and amortization	(1,541.3)		(2,538.9)		(481.6)		(258.9)		1,285.1		(3,535.6)
Adjusted gross margin	446.7		388.6		388.3		284.6		—		1,508.2
Operating expenses	(156.2)		(100.6)		(78.3)		(77.4)		—		(412.5)
Segment profit	290.5		288.0		310.0		207.2		—		1,095.7
Depreciation and amortization	(123.6)		(111.5)		(163.1)		(87.1)		(4.2)		(489.5)
Gross margin	166.9		176.5		146.9		120.1		(4.2)		606.2
Impairments	—		(20.7)		—		—		—		(20.7)
Gain on disposition of assets	0.1		0.2		0.8		0.7		—		1.8
General and administrative	—		—		—		—		(87.8)		(87.8)
Interest expense, net of interest income	—		—		—		—		(205.2)		(205.2)

Loss from unconsolidated affiliate investments	—		—		—		—		(3.7)		(3.7)
Other expense	—		—		—		—		(0.2)		(0.2)
Income (loss) before non-controlling interest and income taxes	$	167.0	$	156.0	$	147.7	$	120.8	$	(301.1)	$	290.4
Capital expenditures	$	191.2	$	53.1	$	59.3	$	46.9	$	4.8	$	355.3


	Permian		Louisiana		Oklahoma		North Texas		Corporate		Totals
Nine Months Ended September 30, 2022
Natural gas sales	$	880.2	$	868.2	$	277.9	$	106.1	$	—	$	2,132.4
NGL sales	0.2		3,382.6		8.4		1.4		—		3,392.6
Crude oil and condensate sales	884.3		280.9		108.6		—		—		1,273.8

Product sales	1,764.7		4,531.7		394.9		107.5		—		6,798.8

NGL sales—related parties	1,207.6		126.3		653.9		452.4		(2,440.2)		—
Crude oil and condensate sales—related parties	—		—		0.3		9.6		(9.9)		—
Product sales—related parties	1,207.6		126.3		654.2		462.0		(2,450.1)		—
Gathering and transportation	54.4		54.1		133.3		129.3		—		371.1
Processing	28.8		1.2		85.4		95.0		—		210.4
NGL services	—		61.8		—		0.2		—		62.0
Crude services	16.0		26.7		9.9		0.5		—		53.1
Other services	0.6		1.2		0.4		0.4		—		2.6
Midstream services	99.8		145.0		229.0		225.4		—		699.2



Crude services—related parties	—		—		0.1		—		(0.1)		—
Other services—related parties	—		0.2		—		—		(0.2)		—
Midstream services—related parties	—		0.2		0.1		—		(0.3)		—
Revenue from contracts with customers	3,072.1		4,803.2		1,278.2		794.9		(2,450.4)		7,498.0
Realized loss on derivatives	(11.3)		(5.8)		(18.9)		(8.6)		—		(44.6)
Change in fair value of derivatives	9.0		10.2		10.6		8.6		—		38.4
Total revenues	3,069.8		4,807.6		1,269.9		794.9		(2,450.4)		7,491.8
Cost of sales, exclusive of operating expenses and depreciation and amortization	(2,628.0)		(4,425.7)		(913.4)		(514.0)		2,450.4		(6,030.7)
Adjusted gross margin	441.8		381.9		356.5		280.9		—		1,461.1
Operating expenses	(145.3)		(105.4)		(67.6)		(68.3)		—		(386.6)
Segment profit	296.5		276.5		288.9		212.6		—		1,074.5
Depreciation and amortization	(110.6)		(114.6)		(154.7)		(90.5)		(4.1)		(474.5)
Gross margin	185.9		161.9		134.2		122.1		(4.1)		600.0

Gain (loss) on disposition of assets	—		0.3		0.5		(4.7)		—		(3.9)
General and administrative	—		—		—		—		(91.9)		(91.9)
Interest expense, net of interest income	—		—		—		—		(171.0)		(171.0)
Loss on extinguishment of debt	—		—		—		—		(6.2)		(6.2)
Loss from unconsolidated affiliate investments	—		—		—		—		(4.0)		(4.0)
Other income	—		—		—		—		0.6		0.6
Income (loss) before non-controlling interest and income taxes	$	185.9	$	162.2	$	134.7	$	117.4	$	(276.6)	$	323.6

Capital expenditures	$	130.6	$	18.5	$	45.1	$	17.7	$	5.1	$	217.0

Schedule of Segment Assets

The table below represents information about segment assets as of September 30, 2023 and December 31, 2022 (in millions):


Segment Identifiable Assets:	September 30, 2023		December 31, 2022
Permian	$	2,771.5	$	2,661.4
Louisiana	2,164.0		2,310.7
Oklahoma	2,330.3		2,420.4
North Texas	1,025.5		1,094.6
Corporate (1)	199.2		163.9
Total identifiable assets	$	8,490.5	$	8,651.0

____________________________(1)Accounts receivable and accrued revenue sold to the SPV for collateral under the AR Facility are included within the Permian, Louisiana, Oklahoma, and North Texas segments.