10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 For the quarterly period ended September 30, 2024

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _________ to _________

Commission File Number: 001-38048

KINETIK HOLDINGS INC.

(Exact name of registrant as specified in its charter)

Delaware	81-4675947
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

2700 Post Oak Blvd, Suite 300

Houston, Texas, 77056

(Address of principal executive offices)

(Zip Code)

(713) 621-7330

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Class A common stock, $0.0001 par value	KNTK	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☒
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Number of shares of registrant’s Class A Common Stock, par value $0.0001 per share issued and outstanding as of October 31, 2024	59,754,273
Number of shares of registrant’s Class C Common Stock, par value $0.0001 per share issued and outstanding as of October 31, 2024	97,783,034

TABLE OF CONTENTS

 

Item		Page
	PART I — FINANCIAL INFORMATION
1.	FINANCIAL STATEMENTS (UNAUDITED)	1
	CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2024 AND 2023	1
	CONDENSED CONSOLIDATED BALANCE SHEETS - AS OF SEPTEMBER 30, 2024 AND DECEMBER 31, 2023	2
	CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - NINE MONTHS ENDED SEPTEMBER 30, 2024 AND 2023	3
	CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY AND NONCONTROLLING INTERESTS - THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2024 AND 2023	5
	NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS	7
	1.DESCRIPTION OF THE ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	7
	2.BUSINESS COMBINATIONS	8
	3.REVENUE RECOGNITION	11
	4.PROPERTY, PLANT AND EQUIPMENT	12
	5.INTANGIBLE ASSETS, NET	13
	6.EQUITY METHOD INVESTMENTS	13
	7.DEBT AND FINANCING COSTS	15
	8.ACCRUED EXPENSES	17
	9.EQUITY	17
	10.FAIR VALUE MEASUREMENTS	18
	11.DERIVATIVES AND HEDGING ACTIVITIES	18
	12.SHARE-BASED COMPENSATION	20
	13.INCOME TAXES	22
	14.NET INCOME PER SHARE	23
	15.COMMITMENTS AND CONTINGENCIES	23
	16.SEGMENTS	24
	17.SUBSEQUENT EVENTS	28
2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	29
3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	42
4.	CONTROLS AND PROCEDURES	43
	PART II — OTHER INFORMATION
1.	LEGAL PROCEEDINGS	44
1A.	RISK FACTORS	44
2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	44
5.	OTHER INFORMATION	44
6.	EXHIBITS	45
	SIGNATURES	47

i

GLOSSARY OF TERMS

The following are abbreviations and definitions of certain terms which may be used in this Quarterly Report on Form 10-Q and certain terms which are commonly used in the exploration, production and midstream sectors of the oil and natural gas industry:

•ASU. Accounting Standards Updates

•Bbl. One stock tank barrel of 42 United States (“U.S.”) gallons liquid volume used herein in reference to crude oil, condensate or natural gas liquids

•Bcf. One billion cubic feet

•Bcf/d. One Bcf per day

•Btu. One British thermal unit, which is the quantity of heat required to raise the temperature of a one-pound mass of water by one-degree Fahrenheit

•CODM. Chief Operating Decision Maker

•Delaware Basin. Located on the western section of the Permian Basin. The Delaware Basin covers a 6.4 million acre area

•Field. An area consisting of a single reservoir or multiple reservoirs all grouped on, or related to, the same individual geological structural feature or stratigraphic condition. The field name refers to the surface area, although it may refer to both the surface and the underground productive formations

•FASB. Financial Accounting Standards Board

•GAAP. United States Generally Accepted Accounting Principles

•MBbl. One thousand barrels of crude oil, condensate or NGLs

•MBbl/d. One MBbl per day

•Mcf. One thousand cubic feet of natural gas

•Mcf/d. One Mcf per day

•MMBtu. One million Btus

•MMcf. One million cubic feet of natural gas

•MMcf/d. One MMcf per day

•MVC. Minimum volume commitments

•NGL or NGLs. Natural gas liquids. Hydrocarbons found in natural gas, which may be extracted as liquefied petroleum gas and natural gasoline

•Throughput. The volume of crude oil, natural gas, NGLs, water and refined petroleum products transported or passing through a pipeline, plant, terminal or other facility during a particular period

•SEC. United States Securities and Exchange Commission

•SOFR. Secured overnight financing rate

ii

FORWARD-LOOKING STATEMENTS AND RISK

This Quarterly Report on Form 10-Q includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements other than statements of historical facts included or incorporated by reference in this Quarterly Report on Form 10-Q, including, without limitation, statements regarding our future financial position, business strategy, budgets, projected revenues, projected costs and plans, and objectives of management for future operations, are forward-looking statements. In addition, forward-looking statements generally can be identified by the use of forward-looking terminology such as “may,” “will,” “could,” “expect,” “intend,” “project,” “estimate,” “anticipate,” “plan,” “believe,” “continue,” “seek,” “guidance,” “might,” “outlook,” “possibly,” “potential,” “prospect,” “should,” “would,” or similar terminology. The absence of these words does not mean that a statement is not forward-looking. Although we believe that the expectations reflected in such forward-looking statements are reasonable under the circumstances, we can give no assurance that such expectations will prove to have been correct. Key factors that could cause actual results to differ materially from our expectations include, but are not limited to, assumptions about:

•our ability to integrate operations or realize any anticipated benefits, savings or growth from the Durango Acquisition (as defined herein). See Note 2 — Business Combinations in the Notes to our Condensed Consolidated Financial Statements set forth in this Form 10-Q;

•the market prices of oil, natural gas, NGLs and other products or services;

•competition from other pipelines, terminals or other forms of transportation and competition from other service providers for gathering system capacity and availability;

•production rates, throughput volumes, reserve levels and development success of dedicated oil and gas fields;

•our future financial condition, results of operations, liquidity, compliance with debt covenants and competitive position;

•our future revenues, cash flows and expenses;

•our access to capital and our anticipated liquidity;

•our future business strategy and other plans and objectives for future operations;

•the amount, nature and timing of our future capital expenditures, including future development costs;

•the risks associated with potential acquisitions, divestitures, new joint ventures or other strategic opportunities;

•the recruitment and retention of our officers and personnel;

•the likelihood of success of and impact of litigation and other proceedings, including regulatory proceedings;

•our assessment of our counterparty risk and the ability of our counterparties to perform their future obligations;

•the impact of federal, state and local political, regulatory and environmental developments where we conduct our business operations;

•the occurrence of an extreme weather event, terrorist attack or other event that materially impacts project construction and our operations, including cyber or other operational electronic systems;

•our ability to successfully implement, execute and achieve our sustainability goals and initiatives;

•the realizability and valuation allowance assessment of our net deferred tax asset position;

•general economic and political conditions, including the armed conflicts in Ukraine, Israel and the Gaza Strip and elsewhere in the Middle East, the impact of continued inflation, central bank policy actions and other factors; and other factors disclosed in “Part I, Item 1A. — Risk Factors” of the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, filed on March 5, 2024.

Other factors or events that could cause the Company’s actual results to differ materially from the Company’s expectations may emerge from time to time, and it is not possible for the Company to predict all such factors or events. All subsequent written and oral forward-looking statements attributable to the Company, or persons acting on its behalf, are expressly qualified in their entirety by the cautionary statements. All forward-looking statements speak only as of the date of this Quarterly Report on Form 10-Q. Except as required by law, the Company disclaims any obligation to update or revise its forward-looking statements, whether based on changes in internal estimates or expectations, new information, future developments or otherwise.

iii

PART I — FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS (UNAUDITED)

KINETIK HOLDINGS INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
	(In thousands, except per share data)
Operating revenues:
Service revenue	$	103,100	$	104,349	$	301,710	$	310,325
Product revenue	290,423		221,280		787,092		586,534
Other revenue	2,839		4,672		8,411		10,685
Total operating revenues(1)	396,362		330,301		1,097,213		907,544
Operating costs and expenses:
Costs of sales (exclusive of depreciation and amortization)(2) (3)	144,586		147,756		444,786		374,100
Operating expenses	55,804		42,925		143,278		118,804
Ad valorem taxes	5,896		5,607		18,400		14,954
General and administrative expenses	29,619		22,751		94,846		73,131
Depreciation and amortization expenses	87,583		69,935		236,250		208,271
Loss on disposal of assets	—		2,927		4,090		15,166
Total operating costs and expenses	323,488		291,901		941,650		804,426
Operating income	72,874		38,400		155,563		103,118
Other income (expense):
Interest and other income	1,872		289		2,272		1,625
Loss on debt extinguishment	—		—		(525)		—
Gain on sale of equity method investment	29,953		—		89,837		—
Interest expense	(66,029)		(45,009)		(167,545)		(130,443)
Equity in earnings of unconsolidated affiliates	53,244		50,754		169,668		146,828
Total other income, net	19,040		6,034		93,707		18,010
Income before income taxes	91,914		44,434		249,270		121,128
Income tax expense	8,260		1,303		21,261		2,030
Net income including noncontrolling interest	83,654		43,131		228,009		119,098
Net income attributable to Common Unit limited partners	57,891		27,551		153,504		77,068
Net income attributable to Class A Common Stock Shareholders	$	25,763	$	15,580	$	74,505	$	42,030
Net income attributable to Class A Common Shareholders, per share
Basic	$	0.35	$	0.21	$	1.03	$	0.58
Diluted	$	0.35	$	0.21	$	1.02	$	0.57
Weighted-average shares
Basic	59,811		53,340		59,116		50,464
Diluted	60,424		53,463		59,852		50,719

(1)Includes amounts associated with related parties of nil and $20.0 million for the three months ended September 30, 2024 and 2023, respectively, and $17.2 million and $70.9 million for the nine months ended September 30, 2024 and 2023, respectively.

(2)Includes amounts associated with related parties of $12.8 million and $15.5 million for the three months ended September 30, 2024 and 2023, respectively, and $48.7 million and $50.6 million for the nine months ended September 30, 2024 and 2023, respectively.

(3)Cost of sales (exclusive of depreciation and amortization) is net of gas service revenues totaling $60.2 million and $38.6 million for the three months ended September 30, 2024 and 2023, respectively, and $159.4 million and $107.1 million for the nine months ended September 30, 2024 and 2023, respectively, for certain volumes where we act as principal.

The accompanying notes are an integral part of the Condensed Consolidated Financial Statements.

1

KINETIK HOLDINGS INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

	September 30,		December 31,
	2024		2023
	(In thousands, except shares data)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	20,438	$	4,510
Accounts receivable, net of allowance for credit losses of $1,000 in 2024 and 2023(1)	65,615		215,721
Accounts receivable pledged	150,000		—
Derivative assets	6,276		7,812
Prepaid and other current assets	43,549		29,256
	285,878		257,299
NONCURRENT ASSETS:
Property, plant and equipment, net	3,226,884		2,743,227
Intangible assets, net	878,141		591,670
Derivative asset, non-current	1,593		165
Deferred tax assets	203,671		235,627
Operating lease right-of-use assets	38,101		37,569
Deferred charges and other assets	79,169		85,250
Investments in unconsolidated affiliates	2,141,947		2,540,989
Goodwill	5,077		5,077
	6,574,583		6,239,574
Total assets	$	6,860,461	$	6,496,873
LIABILITIES, NONCONTROLLING INTEREST, AND EQUITY
CURRENT LIABILITIES:
Accounts payable	$	17,160	$	34,000
Accrued expenses	191,789		177,421
Derivative liabilities	6,743		1,734
Current portion of operating lease liabilities	25,483		29,203
Current debt obligations	150,000		—
Other current liabilities	7,505		7,786
	398,680		250,144
NONCURRENT LIABILITIES
Long term debt, net	3,279,689		3,562,809
Contract liabilities	21,858		25,761
Operating lease liabilities	13,147		9,349
Derivative liabilities	1,081		5,363
Other liabilities	67,517		3,219
Deferred tax liabilities	16,014		13,244
	3,399,306		3,619,745
Total liabilities	3,797,986		3,869,889
COMMITMENTS AND CONTINGENCIES (Note 15)
Redeemable noncontrolling interest — Common Unit limited partners	4,783,180		3,157,807
EQUITY:
Class A Common Stock: $0.0001 par, 1,500,000,000 shares authorized, 59,751,435 and 57,096,538 shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively	6		6
Class C Common Stock: $0.0001 par, 1,500,000,000 shares authorized, 97,783,034 and 94,089,038 shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively	9		9
Deferred consideration	1		—
Additional paid-in capital	—		192,678
Accumulated deficit	(1,720,721)		(723,516)
Total equity	(1,720,705)		(530,823)
Total liabilities, noncontrolling interest, and equity	$	6,860,461	$	6,496,873

(1)Includes amounts of $15.8 million associated with related parties as of December 31, 2023. No related party balance as of September 30, 2024. See Note 1—Description of the Organization and Summary of Significant Accounting Polices in the Notes to Condensed Consolidated Financial Statements for additional information.

The accompanying notes are an integral part of the Condensed Consolidated Financial Statements.

2

KINETIK HOLDINGS INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	Nine Months Ended September 30,
	2024		2023
	(In thousands)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income including noncontrolling interest	$	228,009	$	119,098
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization expense	236,250		208,271
Amortization of deferred financing costs	5,497		4,601
Amortization of contract costs	4,965		4,965
Contingent liabilities fair value adjustment	1,400		—
Distributions from unconsolidated affiliates	223,670		205,891
Derivatives settlement	(8,103)		15,111
Derivative fair value adjustment	8,938		(41,028)
Warrants fair value adjustment	—		(73)
Gain on sale of equity method investment	(89,837)		—
Loss on disposal of assets	4,090		15,166
Equity in earnings of unconsolidated affiliates	(169,668)		(146,828)
Loss on debt extinguishment	525		—
Share-based compensation	52,868		43,340
Deferred income taxes	19,733		1,675
Changes in operating assets and liabilities:
Accounts receivable and pledged receivable	29,492		(26,982)
Other assets	(3,729)		(7,033)
Accounts payable	(53,361)		(780)
Accrued liabilities	4,815		8,840
Other non-current liabilities	(1,744)		668
Operating leases	(454)		683
Net cash provided by operating activities	493,356		405,585
CASH FLOWS FROM INVESTING ACTIVITIES:
Property, plant and equipment expenditures	(155,805)		(245,798)
Intangible assets expenditures	(7,744)		(15,079)
Investments in unconsolidated affiliates	(3,273)		(202,729)
Net cash paid for acquisition of interest in unconsolidated affiliate	(85,417)		—
Distributions from unconsolidated affiliate	2,789		5,793
Cash proceeds from sale of equity method investment	524,390		—
Cash proceeds from disposals of assets	334		213
Net cash paid for acquisition	(341,183)		(125,000)
Net cash used in investing activities	(65,909)		(582,600)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from borrowings under A/R Facility	151,200		—
Payments on A/R Facility	(1,200)		—
Payments on Term Loan Credit Facility	(200,000)		—
Payments of debt issuance costs	(1,086)		—
Payment of debt discount	(500)		—
Proceeds from revolver	826,000		673,000
Payments of revolver	(913,000)		(438,000)
Cash dividends paid to Class A Common Stock shareholders	(128,428)		(58,030)
Distributions paid to Class C Common Unit limited partners	(144,505)		(524)
Repurchase of Class A Common Stock	—		(5,757)
Net cash (used in) provided by financing activities	(411,519)		170,689
Net change in cash	15,928		(6,326)

3

KINETIK HOLDINGS INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	Nine Months Ended September 30,
	2024		2023
	(In thousands)
CASH, BEGINNING OF PERIOD	4,510		6,394
CASH, END OF PERIOD	$	20,438	$	68
SUPPLEMENTAL SCHEDULE OF INVESTING AND FINANCING ACTIVITIES
Cash paid for interest, net of amounts capitalized	$	166,769	$	165,877
Cash paid for income taxes, net	$	559	$	484
Property and equipment and intangible accruals in accounts payable and accrued liabilities	$	24,140	$	25,237
Right-of-use assets obtained in exchange for lease liabilities	$	42,974	$	5,189
Class A Common Stock issued through dividend and distribution reinvestment plan	$	75,243	$	263,771
Fair value of Durango assets acquired(1)	$	910,221	$	—
Cash consideration paid	357,968		—
Class C Common Units issued in exchange	148,200		—
Deferred consideration	275,000		—
Contingent consideration	64,000		—
Durango liabilities assumed	$	65,053	$	—

(1)See Note 2—Business Combinations in the Notes to Condensed Consolidated Financial Statements for additional information regarding the Durango Acquisition (as defined herein).

The accompanying notes are an integral part of the Condensed Consolidated Financial Statements.

4

KINETIK HOLDINGS INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY AND NONCONTROLLING INTERESTS

(Unaudited)

	Redeemable Noncontrolling Interest — Common Unit Limited Partners		Class A Common Stock			Class C Common Stock						Additional Paid-in Capital		Accumulated Deficit		Treasury Stock		Total Equity
			Shares	Amount		Shares	Amount		Deferred Consideration Shares(1)	Amount
			(In thousands)
For the Quarter Ended September 30, 2023
Balance at June 30, 2023	$	3,242,619	51,973	$	5	94,089	$	9	—	$	—	$	—	$	(902,446)	$	(3,325)	$	(905,757)
Issuance of common stock through dividend and distribution reinvestment plan	—		2,546	1		—	—		—	—		88,144		—		—		88,145
Retirement of treasury stock	—		—	—		—	—		—	—		—		(3,325)		3,325		—
Share-based compensation	—		1	—		—	—		—	—		12,502		—		—		12,502
Net income	27,551		—	—		—	—		—	—		—		15,580		—		15,580
Change in redemption value of noncontrolling interests	8,899		—	—		—	—		—	—		(8,899)		—		—		(8,899)
Distributions paid to Common Unit limited partners	(70,568)		—	—		—	—		—	—		—		—		—		—
Dividends on Class A Common Stock ($0.75 per share)	—		—	—		—	—		—	—		—		(39,587)		—		(39,587)
Balance at September 30, 2023	$	3,208,501	54,520	$	6	94,089	$	9	—	$	—	$	91,747	$	(929,778)	$	—	$	(838,016)
For the Quarter Ended September 30, 2024
Balance at June 30, 2024	$	4,289,591	59,736	$	6	97,783	$	9	7,680	$	1	$	—	$	(1,206,909)	$	—	$	(1,206,893)
Issuance of common stock through dividend and distribution reinvestment plan	—		11	—		—	—		—	—		444		—		—		444
Share-based compensation	—		4	—		—	—		—	—		15,171		—		—		15,171
Net income	57,891		—	—		—	—		—	—		—		25,763		—		25,763
Change in redemption value of noncontrolling interests	509,035		—	—		—	—		—	—		(14,801)		(494,234)		—		(509,035)
Recognition of deferred tax asset	—		—	—		—	—		—	—		(814)		—		—		(814)
Distribution paid to Common Unit limited partners	(73,337)		—	—		—	—		—	—		—		—		—		—
Dividends on Class A Common Stock ($0.75 per share)	—		—	—		—	—		—	—		—		(45,341)		—		(45,341)
Balance at September 30, 2024	$	4,783,180	59,751	$	6	97,783	$	9	7,680	$	1	$	—	$	(1,720,721)	$	—	$	(1,720,705)

5

KINETIK HOLDINGS INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY AND NONCONTROLLING INTERESTS

(Unaudited)

	Redeemable Noncontrolling Interest — Common Unit Limited Partners		Class A Common Stock				Class C Common Stock						Additional Paid-in Capital		Accumulated Deficit		Treasury Stock		Total Equity
			Shares		Amount		Shares	Amount		Deferred Consideration Shares(1)	Amount
			(In thousands)
For the Nine Months Ended September 30, 2023
Balance at December 31, 2022	$	3,112,409	45,679		$	5	94,270	$	9	—	$	—	$	118,840	$	(958,629)	$	—	$	(839,775)
Redemption of Common Units	(5,634)		181		—		(181)	—		—	—		5,634		—		—		5,634
Issuance of common stock through dividend and distribution reinvestment plan	—		8,641		1		—	—		—	—		263,771		—		—		263,772
Retirement of treasury stock	—		—		—		—	—		—	—		—		(5,757)		5,757		—
Repurchase of Class A Common Stock	—		(194)		—		—	—		—	—		—		—		(5,757)		(5,757)
Share-based compensation	—		213		—		—	—		—	—		43,340		—		—		43,340
Net income	77,068		—		—		—	—		—	—		—		42,030		—		42,030
Change in redemption value of noncontrolling interests	236,358		—		—		—	—		—	—		(339,838)		103,480		—		(236,358)
Distributions paid to Common Unit limited partners	(211,700)		—		—		—	—		—	—		—		—		—		—
Dividends on Class A Common Stock ($2.25 per share)	—		—		—		—	—		—	—		—		(110,902)		—		(110,902)
Balance at September 30, 2023	$	3,208,501	54,520		$	6	94,089	$	9	—	$	—	$	91,747	$	(929,778)	$	—	$	(838,016)
For the Nine Months Ended September 30, 2024
Balance at December 31, 2023	$	3,157,807	$	57,097	$	6	94,089	$	9	—	$	—	$	192,678	$	(723,516)	$	—	$	(530,823)
Durango Acquisition	423,200		—		—		3,840	—		7,680	1		—		—		—		1
Redemption of Common Units	(5,060)		146		—		(146)	—		—	—		5,060		—		—		5,060
Issuance of common stock through dividend and distribution reinvestment plan	—		2,205		—		—	—		—	—		75,243		—		—		75,243
Share-based compensation	—		303		—		—	—		—	—		52,868		—		—		52,868
Net income	153,504		—		—		—	—		—	—		—		74,505		—		74,505
Change in redemption value of noncontrolling interests	1,268,038		—		—		—	—		—	—		(330,196)		(937,842)		—		(1,268,038)
Recognition of deferred tax asset	—		—				—	—		—	—		4,347		—		—		4,347
Distribution paid to Common Unit limited partners	(214,309)		—		—		—	—		—	—		—		—		—		—
Dividends on Class A Common Stock ($2.25 per share)	—		—		—		—	—		—	—		—		(133,868)		—		(133,868)
Balance at September 30, 2024	$	4,783,180	59,751		$	6	97,783	$	9	7,680	$	1	$	—	$	(1,720,721)	$	—	$	(1,720,705)

(1)Pursuant to the Durango MIPA (as defined herein), deferred consideration of 7.7 million shares of Class C Common Stock is to be issued on July 1, 2025. Fair value of the deferred consideration was included in the “Redeemable noncontrolling interest—Common Units limited partners” of the Condensed Consolidated Balance Sheets as of September 30, 2024.

The accompanying notes are an integral part of the Condensed Consolidated Financial Statements.

6

KINETIK HOLDINGS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

These Condensed Consolidated Financial Statements have been prepared by Kinetik Holdings Inc. (the “Company”), without audit, pursuant to the rules and regulations of the SEC. They reflect all adjustments that are, in the opinion of management, necessary for a fair presentation of the results for interim periods, on a basis consistent with the annual audited financial statements, with the exception of recently adopted accounting pronouncements. All such adjustments are of a normal recurring nature. Certain information, accounting policies and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to make the information presented not misleading. This Quarterly Report on Form 10-Q should be read along with the Company’s audited financial statements and related notes thereto for the year ended December 31, 2023 included in the Company’s Annual Report on Form 10-K filed with the SEC on March 5, 2024.

1.    DESCRIPTION OF THE ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization

The Company is a holding company, whose only significant assets are ownership of the non-economic general partner interest and an approximate 38% limited partner interest in Kinetik Holdings LP, a Delaware limited partnership (the “Partnership”). As the owner of the non-economic general partner interest in the Partnership, the Company is responsible for all operational, management and administrative decisions related to, and consolidates the results of, the Partnership and its subsidiaries.

The Company provides comprehensive gathering, produced water disposal, transportation, compression, processing and treating services necessary to bring natural gas, NGLs and crude oil to market. Additionally, the Company owns equity interests in three separate Permian Basin pipeline entities that have access to various markets along the U.S. Gulf Coast.

Basis of Presentation

The accompanying Condensed Consolidated Financial Statements have been prepared in accordance with GAAP. Certain reclassifications of prior year balances have been made to conform such amounts to the current year’s presentation. These reclassifications have no impact on net income. All adjustments that, in the opinion of management, are necessary for a fair presentation of the results of operations for the interim periods have been made and are of a recurring nature unless otherwise disclosed herein. The results of operations for such interim periods are not necessarily indicative of results of operations for a full year; accordingly, you should read these Condensed Consolidated Financial Statements in conjunction with our consolidated financial statements and related notes included in our 2023 Annual Report on Form 10-K. All intercompany balances and transactions have been eliminated in consolidation.

Significant Accounting Policies

The accounting policies that we follow are set forth in Note 2 – Summary of Significant Accounting Policies of the Notes to consolidated financial statements in our Annual Report on Form 10-K. There were no significant updates or revisions to our accounting policies during the nine months ended September 30, 2024, except as discussed herein.

Accounts Receivable Securitization Facility

Pursuant to ASC 860, Transfers and Servicing, accounts receivable that are sold or contributed by the Partnership to the special purpose vehicle are treated as collateral for borrowings under the third party A/R Facility (as defined below) and are included as “Accounts receivable pledged” within the Condensed Consolidated Balance Sheet. Proceeds from the transfer of the eligible accounts receivable under the third party A/R Facility are secured borrowings included as “Current debt obligations” within our Condensed Consolidated Balance Sheets. Proceeds and repayments under such facility are reflected as cash flows from financing activities in our Consolidated Statements of Cash Flows. See Note 7—Debt and Financing Costs in the Notes to our Condensed Consolidated Financial Statements set forth in this Form 10-Q for further discussion.

7

Transactions with related parties

The Company has revenue contracts and incurs cost of sales and operating expenses with Apache Midstream LLC (“Apache”), which owned more than 5% of the Company’s common stock prior to its secondary offerings completed in December 2023 and March 2024. Pursuant to ASC 850, Related Party Transactions, Apache was no longer a related party after the completion of its secondary offering in December 2023 as it owned less than 10% of the Company’s common stock. Pursuant to Regulation S-K, Item 404(a), Apache ceased to be a related party as of March 18, 2024 as it no longer owned any of the Company’s common stock. In 2024, for the period ended March 18, 2024, revenue from Apache was $17.2 million, cost of sales was $9.4 million and operating expenses were $0.2 million. In 2023, revenue from Apache was $20.0 million and $70.9 million, cost of sales was $13.1 million and $44.2 million, and operating expenses were $0.1 million and $0.5 million for the three and nine months ended September 30, 2023, respectively.

In addition, the Company incurs cost of sales with two of its equity method investment (“EMI”) pipeline entities, Permian Highway Pipeline LLC (“PHP”) and Breviloba, LLC (“Breviloba”). The Company pays a demand fee to PHP and pays a capacity fee to Breviloba for certain volumes moving on the Shin Oak NGL Pipeline. For the three and nine months ended September 30, 2024, the Company recorded cost of sales of $12.8 million and $39.3 million, respectively, with these affiliates. For the three and nine months ended September 30, 2023, the Company recorded cost of sales of $2.4 million and $6.4 million, respectively, with these affiliates.

Recently issued accounting pronouncements not yet adopted

Improvements to Reportable Segment Disclosures

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. The amendments in this update require, among other items, that public entities disclose, on an annual and interim basis, significant segment expenses that are regularly provided to the CODM and included within each reported measure of segment profit or loss. Additionally, the amendments require annual disclosure of the title and position of the CODM and how that individual uses the reported measure(s) of segment profit or loss in assessing segment performance and how to allocate resources.

These amendments are effective for fiscal years beginning after December 15, 2023, and for interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. The disclosures required in the amendments apply retrospectively to all prior periods presented in the financial statements. We are evaluating the effect of the amendments on our consolidated financial statements and expect to disclose the required information for fiscal years beginning in the Annual Report on Form 10-K for the year ended December 31, 2024 and for interim periods beginning in the Quarterly Report on Form 10-Q for the quarter ended March 31, 2025. The impact of the adoption will be limited to additional disclosure in the notes to the consolidated financial statements.

Improvements to Income Tax Disclosures

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The amendments in this update require, among other items, that public entities disclose, on an annual and interim basis, (i) specific categories of income taxes in the rate reconciliation, and (ii) a disaggregation of income taxes paid by federal, state, and foreign taxes.

These amendments are effective for fiscal years beginning after December 15, 2024, with early adoption permitted. The amendments are required to be applied prospectively with retrospective application permitted. We are evaluating the effect of the amendments on our consolidated financial statements and expect to disclose the required information beginning in the Annual Report on Form 10-K for the year ended December 31, 2025.

2.    BUSINESS COMBINATIONS

For acquired businesses, we recognize the identifiable assets acquired and the liabilities assumed at their estimated fair values on the date of acquisition with any excess purchase price over the fair value of net assets acquired recorded to goodwill. Determining the fair value of these items requires management’s judgment and the utilization of an independent valuation specialist, if applicable, and involves the use of significant estimates and assumptions.

8

Durango Permian LLC Acquisition

On June 24, 2024 (the “Closing Date”), the Company consummated the previously announced transaction contemplated by the Membership Interest Purchase Agreement (the “Durango MIPA”), dated May 9, 2024, by and between the Company, the Partnership, and Durango Midstream LLC, an affiliate of Morgan Stanley Equity Partners (the “Durango Seller”), pursuant to which the Partnership purchased all of the membership interests of Durango Permian, LLC and its wholly owned subsidiaries (“Durango”) from Durango Seller for an adjusted purchase price of approximately $845.2 million (the “Durango Acquisition”), consisting of (i) $358.0 million of cash consideration paid at closing, (ii) approximately 3.8 million shares of Class C Common Stock, par value $0.0001 per share of the Company (“Class C Common Stock”) (and an equivalent number of common units in the Partnership (“OpCo Units”)), valued at $148.2 million, issued at closing and (iii) approximately 7.7 million shares of Class C Common Stock (and an equivalent number of OpCo Units), valued at $275.0 million, to be issued on July 1, 2025. Durango Seller is also entitled to an earn out of up to $75.0 million in cash contingent upon the Kings Landing gas processing complex in Eddy County, New Mexico (the “Kings Landing Project”), which is currently under construction, being placed into service (the “Kings Landing Earnout”). The Kings Landing Earnout is subject to reduction based on actual capital costs associated with the Kings Landing Project. The Durango Acquisition allows the Company to further expand its footprint into New Mexico and across the Northern Delaware Basin.

The Durango Acquisition was accounted for as a business combination in accordance with ASC 805 Business Combination (“ASC 805”). Starting on the Closing Date, our Consolidated Financial Statements reflected Durango as a consolidated subsidiary. The accompanying Condensed Consolidated Financial Statements herein include (i) the combined net assets of the Company carried at historical costs and net assets of Durango carried at fair value as of the Closing Date and (ii) the combined results of operations of the Company with Durango’s results presented within the Condensed Consolidated Financial Statements from the Closing Date going forward.

The preliminary purchase price allocation was based on Durango’s latest financial statements available as of May 31, 2024, and included preliminary adjustments for working capital and fair value of underlying assets acquired and liabilities assumed. Both observable and non-observable market data, thus Level 2 and Level 3 inputs, are used in the assessment of the fair value of the assets acquired and liabilities assumed listed in the below table. The fair value of the processing plants, gathering system and related facilities and equipment is based on market and cost approaches and will be depreciated over an estimated useful life ranging from five to thirty years, which is consistent with the Company’s policy over similar facilities and equipment. The fair value of the intangible assets is based on the market approach for the right-of-way and discounted cash flow approach for customer contracts, which will be amortized over estimated useful lives ranging from seven to twelve years. The assumed liabilities are approximate to fair value at the Closing Date. Acquired net assets from this business combination were included in the Midstream Logistic segment. In addition, the Company recorded a contingent liability related to the Kings Landing Earnout based on project completion probability, see additional information in Note 15—Commitments and Contingencies in the Notes to our Condensed Consolidated Financial Statements set forth in this Form 10-Q.

Since the Closing Date, the Company has made necessary adjustments to the purchase price allocation as information about facts and circumstances that existed at the Closing Date have become available. This included certain working capital adjustments as a result of obtaining Durango’s closing balance sheet as of June 30, 2024. During the three months ended September 30, 2024, the Company identified working capital adjustments of $21.0 million resulting from the final closing balance sheet, and valuation adjustments related to the long-lived assets and intangible assets of $10.6 million, resulting in a decrease in goodwill of $10.4 million. The Company will continue to identify necessary adjustments to finalize the purchase price allocation during the 12-month period following the Closing Date as we obtain the remaining original cost data for our tangible asset valuation, as well as complete our evaluation of the potential liabilities assumed, including certain historical environmental exposures.

9

The following table summarizes the estimated fair value of assets acquired and liabilities assumed in the Durango Acquisition as of June 24, 2024, in accordance with ASC 805:

(In thousands)	Amount
Cash and cash equivalents	$	16,785
Accounts receivable	29,386
Prepaid and other current assets	10,000
Property, plant, and equipment, net	471,429
Intangible assets, net	379,000
Deferred charges and other assets	4
Operating lease ROU assets	3,617
Total assets acquired	910,221
Accounts payable	34,314
Accrued expenses	7,140
Contract liabilities	642
Operating lease liabilities	3,617
Deferred tax liabilities	19,340
Total liabilities assumed	65,053
Contingent consideration(1)	64,000
Consideration transferred	$	781,168

(1)Pursuant to ASC 805, the Company evaluated the earn-out consideration classification in accordance with ASC 480, Distinguishing Liabilities from Equity (“ASC 480”). The Company determined the earn-out consideration to be classified as a liability based on the settlement provision. Therefore, the Company records the contingent consideration at fair value as of September 30, 2024. Additional discussion in Note 15—Commitments and Contingencies in the Notes to our Condensed Consolidated Financial Statements set forth in this Form 10-Q.

The Company incurred acquisition-related costs of $3.2 million for the nine months ended September 30, 2024, which were included in the “General and administrative expenses” of the Condensed Consolidated Statements of Operations.

The Company’s Condensed Consolidated Statement of Operations included results of operations from Durango starting from the Closing Date through September 30, 2024, which included revenues of $35.8 million and $38.9 million, and net income including noncontrolling interest of $1.4 million and $1.6 million for the three and nine months ended September 30, 2024, respectively.

Supplemental Pro Forma Information

The unaudited supplemental pro forma financial data is for informational purposes only and is not indicative of future results. The results below for the three and nine months ended September 30, 2024 and 2023, respectively, combine the results of the Company and Durango, giving effect to the Durango Acquisition as if it had been completed on January 1, 2023.

	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
	(In thousands)
Revenues	$	396,362	$	410,988	$	1,210,257	$	1,138,419
Net income including noncontrolling interest	$	83,602	$	46,575	$	228,652	$	123,738

Given the assumed pro forma transaction date of January 1, 2023, we removed $3.5 million of acquisition-related expenses for the nine months ended September 30, 2024 and recognized $3.5 million of acquisition-related expenses for the nine months ended September 30, 2023. We also removed $24.0 million of interest expense on Durango’s debt for the nine months ended September 30, 2024, and $3.9 million and $11.1 million for the three and nine months ended September 30, 2023, respectively, as if the business combination had occurred and the debt had been paid off on January 1, 2023.

10

Midstream Infrastructure Assets

In the first half of 2023, the Partnership closed on a purchase and sale agreement for certain midstream assets for $65.0 million together with a new 20-year midstream service agreement. Midstream assets acquired consisted of water gathering and disposal assets of $61.9 million and intangible right-of-way assets of $3.1 million. In addition, the Partnership entered into an incentive and acceleration agreement related to near term supplemental development activities on acreage dedicated for midstream services to affiliates of the Partnership. Consideration for the incentive and acceleration agreement of $60.0 million was capitalized as a contract asset in accordance with ASC 606, of which $4.7 million was included in “Prepaid and Other Current Assets” and $55.3 million was included in “Deferred Charges and Other Assets” in the Condensed Consolidated Balance Sheet as of the date of acquisition. Acquired net assets from this business combination were included in the Midstream Logistics segment.

Goodwill

The Company had goodwill of $5.1 million recorded in the Midstream Logistic segment related to a past business combination as of September 30, 2024. Goodwill is tested at least annually, or more frequently as events occur or circumstances change that would more-likely-than-not reduce fair value of a reporting unit below its carrying value. Company’s management assessed whether there have been events or circumstances that trigger the fair value of the reporting unit to be lower than its net carrying value since consummation of the respective business combination and concluded that goodwill was not impaired as of September 30, 2024.

3.    REVENUE RECOGNITION

Disaggregation of Revenue

The following table presents a disaggregation of the Company’s revenue:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
	(In thousands)
Gathering and processing services	$	103,100	$	104,349	$	301,710	$	310,325
Natural gas, NGLs and condensate sales	290,423		221,280		787,092		586,534
Other revenue	2,839		4,672		8,411		10,685
Total revenues	$	396,362	$	330,301	$	1,097,213	$	907,544

There have been no significant changes to the Company’s contracts with customers during the three and nine months ended September 30, 2024 aside from the addition of certain gas gathering and processing agreements associated with the Durango acquisition. The Company did not recognize revenues from MVC deficiency payments for the three and nine months ended September 30, 2024 and recognized $0.4 million and $1.6 million of revenues from MVC deficiency payments for the three and nine months ended September 30, 2023, respectively.

Remaining Performance Obligations

The following table presents our estimated revenue from contracts with customers for remaining performance obligations that have not yet been recognized, representing our contractually committed revenues as of September 30, 2024:

	Amount
Fiscal Year	(In thousands)
Remaining of 2024	$	7,049
2025	71,507
2026	75,387
2027	73,945
2028	72,873
Thereafter	230,750
	$	531,511

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Our contractually committed revenue, for the purposes of the tabular presentation above, is limited to customer contracts that have fixed pricing and fixed volume terms and conditions, including contracts with payment obligations associated with MVCs.

Contract Liabilities

The following table provides information about contract liabilities from contracts with customers as of September 30, 2024:

	Amount
	(In thousands)
Balance at December 31, 2023	$	32,238
Reclassification of beginning contract liabilities to revenue as a result of performance obligations being satisfied	(5,182)
Cash received in advance and not recognized as revenue	997
Balance at September 30, 2024	28,053
Less: Current portion	6,195
Non-current portion	$	21,858

Contract liabilities relate to payments received in advance of satisfying performance obligations under a contract, which result from contribution in aid of construction payments. Current and noncurrent contract liabilities are included in “Other Current Liabilities” and “Contract Liabilities,” respectively, in the Condensed Consolidated Balance Sheets.

Contract Cost Assets

The Company has capitalized certain costs incurred to obtain a contract or additional contract dedicated acreage or volumes that would not have been incurred if the contract or associated acreage and volumes had not been obtained. As of September 30, 2024 and December 31, 2023, the Company had contract acquisition cost assets of $66.2 million and $71.2 million, respectively. Current and noncurrent contract cost assets are included in “Prepaid and Other Current Assets” and “Deferred Charges and Other Assets,” respectively, in the Condensed Consolidated Balance Sheets. The Company amortizes these assets as cost of sales on a straight-line basis over the life of the associated long-term customer contracts. The Company recognized cost of sales associated with these assets of $1.7 million for the three months ended September 30, 2024 and 2023, respectively, and $5.0 million for the nine months ended September 30, 2024 and 2023, respectively.

4.    PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment, at carrying value, is as follows:

	September 30,		December 31,
	2024		2023
	(In thousands)
Gathering, processing, and transmission systems and facilities	$	3,715,716	$	3,253,539
Vehicles	14,714		11,447
Computers and equipment	7,830		6,242
Less: accumulated depreciation	(759,280)		(626,223)
Total depreciable assets, net	2,978,980		2,645,005
Construction in progress	217,637		74,369
Land	30,267		23,853
Total property, plant, and equipment, net	$	3,226,884	$	2,743,227

The cost of property classified as “Construction in progress” is excluded from capitalized costs being depreciated. These amounts represent property that is not yet available to be placed into productive service as of the respective reporting date. The Company recorded $48.7 million and $39.4 million of depreciation expense for the three months ended September 30, 2024 and 2023, respectively, and $135.3 million and $116.6 million for the nine months ended September 30, 2024 and 2023, respectively. There were no impairment triggering events for property, plant and equipment during the three and nine months ended September 30, 2024 and 2023.

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5.    INTANGIBLE ASSETS, NET

Intangible assets, net, are comprised of the following:

	September 30,		December 31,
	2024		2023
	(In thousands)
Customer contracts	$	1,460,287	$	1,139,665
Right of way assets	199,129		141,711
Less accumulated amortization	(781,275)		(689,706)
Total amortizable intangible assets, net	$	878,141	$	591,670

The fair value of acquired customer contracts was capitalized as a result of acquiring favorable customer contracts as of the closing dates of certain past acquisitions and is being amortized using a straight-line method over the remaining terms of the customer contracts, which range from one to seventeen years. Right-of-way assets relate primarily to underground pipeline easements which generally have a useful life of ten years and are amortized using the straight-line method. The right of way agreements are typically for an initial term of ten years with an option to renew for an additional ten years at agreed upon renewal rates based on certain indices or up to 130% of the original consideration paid.

On September 30, 2024, the remaining weighted average amortization periods for customer contracts and right of way assets were approximately 9.03 years and 6.67 years, respectively. The overall remaining weighted average amortization period for the intangible assets as of September 30, 2024 was approximately 8.69 years.

The Company recorded $38.9 million and $30.6 million of amortization expense for the three months ended September 30, 2024 and 2023, respectively, and $100.9 million and $91.6 million for the nine months ended September 30, 2024 and 2023, respectively. There was no impairment recognized on intangible assets for the three and nine months ended September 30, 2024 and 2023.

6.    EQUITY METHOD INVESTMENTS

As of September 30, 2024, the Company owned investments in the following long-haul pipeline entities in the Permian Basin. These investments were accounted for using the equity method of accounting. For each EMI pipeline entity, the Company has the ability to exercise significant influence based on certain governance provisions and its participation in the significant activities and decisions that impact the management and economic performance of the EMI pipeline. The table below presents the ownership percentages and investment balances held by the Company for each entity:

		September 30,		December 31,
	Ownership(1)	2024		2023
		(In thousands)
PHP	55.5%	$	1,623,127	$	1,666,254
Breviloba	33.0%	433,193		443,684
Epic Crude Holdings, LP (“EPIC”)(1)	27.5%	85,627		—
Gulf Coast Express Pipeline LLC (“GCX”)(2)	—%	—		431,051
		$	2,141,947	$	2,540,989

(1)Investment balance is primarily comprised of the additional 12.5% interest that was acquired during July 2024.

(2)The Company owned 16% of GCX as of December 31, 2023 and divested entire ownership in June 2024.

During the quarter, the Company entered into an Equity Sale and Purchase Agreement with third parties to purchase a 12.5% equity interest in EPIC, increasing our total equity interest in EPIC to 27.5%. As the increase in ownership did not result in a controlling interest, and did not represent the funding of prior losses, the Company resumed accounting for its investment in EPIC using the equity method of accounting upon the closing of the acquisition of the additional interests during July 2024.

13

On June 4, 2024, the Company consummated the previously announced transaction contemplated by the Purchase and Sale Agreement dated as of May 9, 2024, to sell its 16% equity interest in GCX to GCX Pipeline, LLC (the "GCX Buyer") for an adjusted price of $524.4 million (the "GCX Sale"), including a $30.0 million earn out in cash upon the approval by the GCX Board of Directors of one or more capital projects that achieve certain capacity expansion criteria. The Company recognized a net gain of $89.8 million for the nine months ended September 30, 2024 in relation to this transaction.

The unamortized basis differences included in the EMI pipeline balances were $365.7 million and $349.3 million as of September 30, 2024 and December 31, 2023, respectively. These amounts represent differences in the Company’s contributions to date and the Company’s underlying equity in the separate net assets within the financial statements of the respective entities. Unamortized basis differences will be amortized or accreted into equity income of unconsolidated affiliates over the useful lives of the underlying pipeline assets. There was capitalized interest of $24.1 million and $24.7 million as of September 30, 2024 and December 31, 2023, respectively. Capitalized interest is amortized on a straight-line basis into equity income of unconsolidated affiliates.

The following table presents the activity in the Company’s EMIs for the nine months ended September 30, 2024:

	Permian Highway Pipeline LLC		Breviloba, LLC		EPIC Crude Holdings, LP		Gulf Coast Express Pipeline LLC		Total
	(In thousands)
Balance at December 31, 2023	$	1,666,254	$	443,684	$	—	$	431,051	$	2,540,989
Contributions and acquisitions	3,273		—		85,417		—		88,690
Distributions(1)	(177,172)		(33,677)		—		(15,610)		(226,459)
Disposition	—		—		—		(430,941)		(430,941)
Equity income, net(2)	130,772		23,186		210		15,500		169,668
Balance at September 30, 2024	$	1,623,127	$	433,193	$	85,627	$	—	$	2,141,947

(1)Distributions consisted of distributions from a return on investment of $223.7 million, which was included in cash flows from operating activities and distributions from a return of investment of $2.8 million, which was included in cash flows from investing activities.

(2)For the nine months ended September 30, 2024, net of amortization and accretion of basis differences and capitalized interests, which represents undistributed earnings, the amortization was $5.9 million from PHP, $0.5 million from Breviloba, LLC, $2.7 million from GCX and accretion of $1.6 million from EPIC.

Summarized Financial Information

The following table represents selected data for the Company’s ongoing EMI pipelines (on a 100 percent basis) for the three and nine months ended September 30, 2024 and 2023.

	Three Months Ended September 30,
	2024						2023
	Permian Highway Pipeline LLC		Breviloba, LLC		EPIC Crude Holdings, LP		Permian Highway Pipeline LLC		Breviloba, LLC		EPIC Crude Holdings, LP
	(In thousands)
Revenues	$	127,719	$	53,929	$	97,514	$	99,923	$	51,002	$	93,138
Operating income	83,785		27,398		25,052		65,549		25,170		22,521
Net income (loss)	83,783		27,558		(5,159)		66,630		25,223		(11,330)

	Nine Months Ended September 30,
	2024						2023
	Permian Highway Pipeline LLC		Breviloba, LLC		EPIC Crude Holdings, LP		Permian Highway Pipeline LLC		Breviloba, LLC		EPIC Crude Holdings, LP
	(In thousands)
Revenues	$	380,359	$	156,326	$	284,050	$	291,859	$	143,544	$	259,250
Operating income	245,467		74,563		70,631		185,862		69,666		36,148
Net income (loss)	245,016		75,005		(29,889)		190,662		70,086		(62,312)

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7.    DEBT AND FINANCING COSTS

Accounts Receivable Securitization Facility

On April 2, 2024, Kinetik Receivables LLC (“Kinetik Receivables”), a bankruptcy remote special purpose entity formed as a direct subsidiary of the Partnership, which is a subsidiary of the Company, entered into an accounts receivable securitization facility with an initial facility limit of $150.0 million (“A/R Facility”) with PNC Bank, as the administrative agent, and certain purchasers party thereto from time to time, which has a scheduled termination date of April 1, 2025. The aggregate fees and expenses paid directly to third parties in obtaining the A/R Facility totaled $1.1 million and were capitalized as debt issuance costs and included in the Condensed Consolidated Balance Sheets as a current asset within “Prepaid and other current assets”, amortized over the term of the A/R Facility to interest expense using the effective-interest method. There were unamortized debt issuance costs related to the A/R Facility of $0.6 million as of September 30, 2024.

Pursuant to the A/R Facility, the Company and certain of its subsidiaries continuously transfer receivables to Kinetik Receivables and Kinetik Receivables transfers receivables that meet certain qualifying conditions to third-party purchasers in exchange for cash. These receivables are held by Kinetik Receivables and are pledged to secure the collectability of the sold receivables and are accounted for as secured borrowings. The amount available for borrowing at any one time under the A/R Facility is limited to an amount calculated based on the outstanding balance of eligible receivables sold to the purchasers, subject to certain reserves, concentration limits, and other limitations. Under the A/R Facility, the Company is subject to pay a yield to the purchasers equal to SOFR plus a spread adjustment of 0.10% and a drawn fee of 0.90%. The Company also pays a fee of 0.40% on the undrawn committed amount of the A/R Facility. Yield and fees payable by the Company under the AR Facility are due monthly. As of September 30, 2024, eligible accounts receivable of $150.0 million were pledged to the A/R Facility as collateral.

The Partnership has continuing involvement with the receivables transferred by Kinetik Receivables to the third-party purchasers by providing collection services.

The A/R Facility is linked to sustainability performance targets (“SPTs”) with respect to (a) female representation in corporate officer positions and (b) reduction in methane emissions intensity. A positive 0.02% and 0.05% fee and yield rate adjustments will be applied, respectively, if neither of the SPTs have been satisfied and a negative 0.02% and 0.05% fee and interest rate adjustments will be applied, respectively, if both of the SPTs have been satisfied.

The net proceeds of the A/R Facility were used, together with cash on hand, to repay a portion of the outstanding borrowings under the existing term loan credit facility (“Term Loan Credit Facility”), lowering the remaining balance to $1.0 billion. As a result, the maturity of the Term Loan Credit Facility extended to December 8, 2026. The Company recognized a loss on debt extinguishment of $0.5 million for the partial payment made on the Term Loan Credit Facility.

The following table summarizes the Company’s debt obligations as of September 30, 2024 and December 31, 2023:

	September 30,		December 31,
	2024		2023
	(In thousands)
A/R Facility	$	150,000	$	—
Total current debt obligations	$	150,000	$	—
Unsecured term loan	$	1,000,000	$	1,200,000
5.875% senior unsecured notes due 2030 (“2030 Notes”)	1,000,000		1,000,000
6.625% senior unsecured notes due 2028 (“2028 Notes”)	800,000		800,000
$1.25 billion revolving line of credit	507,000		594,000
Total long-term debt	3,307,000		3,594,000
Debt issuance costs, net(1)	(27,432)		(31,510)
Unamortized debt premiums and discounts, net	121		319
Total long-term debt, net	$	3,279,689	$	3,562,809

(1)Excludes unamortized debt issuance costs related to the revolving line of credit. Unamortized debt issuance costs associated with the revolving line of credit were $4.2 million and $5.4 million as of September 30, 2024 and December 31, 2023, respectively. The unamortized debt issuance costs related to the revolving credit facilities were included in the “Deferred charges and other assets” of the Condensed Consolidated Balance Sheets.

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The table below presents the components of the Company’s financing costs, net of capitalized interest:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
	(In thousands)
Capitalized interest	$	(2,955)	$	(6,731)	$	(4,885)	$	(13,775)
Debt issuance costs	1,916		1,546		5,497		4,601
Interest expense	67,068		50,194		166,933		139,617
Total financing costs, net of capitalized interest	$	66,029	$	45,009	$	167,545	$	130,443

As of September 30, 2024 and December 31, 2023, unamortized debt issuance costs associated with the 2030 Notes, the 2028 Notes and the Term Loan Credit Facility were $27.4 million and $31.5 million, respectively, and unamortized debt premiums and discount, net, associated with the 2028 Notes and the unsecured term loan were $0.1 million and $0.3 million, respectively.

Compliance with our Covenants

Each of the revolving credit agreements with Bank of America, N.A. as administrative agent and the Term Loan Credit Facility, contain customary covenants and restrictive provisions which may, among other things, limit the Partnership’s ability to create liens, incur additional indebtedness and make restricted payments and the Partnership’s ability to liquidate, dissolve, consolidate with or merge into or with any other person. The 2030 Notes and the 2028 Notes also contain covenants and restrictive provisions, which may, among other things, limit the Partnership’s and its subsidiaries’ ability to create liens to secure indebtedness.

The A/R Facility contains covenants and restrictive provisions with respect to the Partnership and Kinetik Receivables that are customary for accounts receivable securitization facilities. As of September 30, 2024, the Partnership was in compliance with all customary and financial covenants.

Letters of Credit

Our $1.25 billion senior unsecured revolving credit facility (the “Revolving Credit Facility”) scheduled to mature on or before June 8, 2027 can be used for letters of credit. Our obligations with respect to related letters of credit totaled $12.6 million as of September 30, 2024 and December 31, 2023, respectively. As of September 30, 2024, the Revolving Credit Facility has a borrowing base of $730.4 million available.

Fair Value of Financial Instruments

The fair value of the Company and its subsidiaries’ consolidated debt as of September 30, 2024 and December 31, 2023 was $3.48 billion and $3.57 billion, respectively. On September 30, 2024, the senior unsecured notes’ fair value was based on Level 1 inputs, the Term Loan Credit Facility and Revolving Credit Facility’s fair value was based on Level 3 inputs and the A/R Facility’s fair value approximates its carrying value due to its short term nature.

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8.    ACCRUED EXPENSES

The following table provides detail of the Company’s current accrued expenses on September 30, 2024 and December 31, 2023:

	September 30,		December 31,
	2024		2023
	(In thousands)
Accrued product purchases	$	97,635	$	109,172
Accrued taxes	20,270		632
Accrued salaries, vacation, and related benefits	5,349		1,872
Accrued capital expenditures	13,911		18,534
Accrued interest	34,070		33,760
Accrued other expenses	20,554		13,451
Total accrued expenses	$	191,789	$	177,421

Accrued product purchases mainly accrue the liabilities related to producer payments and any additional business-related miscellaneous fees we owe to third parties, such as transport or capacity fees as of September 30, 2024.

9.    EQUITY

Redeemable Noncontrolling Interest — Common Unit Limited Partners

The redemption option of the Common Unit is not legally detachable or separately exercisable from the instrument and is non-transferable; the Common Unit is redeemable at the option of the holder. Therefore, the Common Unit is accounted for as redeemable noncontrolling interest and classified as temporary equity on the Company’s Condensed Consolidated Balance Sheets. During the nine months ended September 30, 2024, 146,250 Common Units were redeemed on a one-for-one basis for shares of Class A Common Stock, par value $0.0001 per share of the Company (“Class A Common Stock”) and a corresponding number of shares of Class C Common Stock were cancelled. In addition, as part of the Durango Acquisition purchase price consideration, approximately 3.8 million shares of Class C Common Stock and an equivalent number of Common Units were issued at closing. There were 97.8 million Common Units and an equal number of Class C Common Stock issued and outstanding as of September 30, 2024 and 7.7 million shares of Class C Common Stock and equivalent number of Common Units of deferred consideration for the Durango Acquisition that will be issued on July 1, 2025. The Common Units fair value was approximately $4.78 billion, including deferred consideration valued as of September 30, 2024.

Common Stock

As of September 30, 2024, there were 59.8 million and 97.8 million shares, respectively, of Class A Common Stock and Class C Common Stock issued and outstanding (collectively, “Common Stock”). In addition, 7.7 million shares of Class C Common Stock will be issued as deferred consideration for the Durango Acquisition on July 1, 2025.

Share Repurchase Program

During the quarter ended September 30, 2024, the Company did not repurchase any of its Class A Common Stock under the Repurchase Program.

Dividend

On August 7, 2024, the Company made cash dividend payments of $118.2 million to holders of Class A Common Stock and Common Units and $0.4 million was reinvested in shares of Class A Common Stock. The significant decrease in the amount reinvested in shares of Class A Common Stock compared with prior quarters was due to the automatic termination of the Dividend and Distribution Reinvestment Agreement on March 8, 2024.

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10.    FAIR VALUE MEASUREMENTS

The following tables present financial assets and liabilities that are measured at fair value on a recurring basis as of September 30, 2024 and December 31, 2023:

	September 30, 2024
	Level 1		Level 2		Level 3		Total
	(In thousands)
Commodity swap	$	—	$	7,785	$	—	$	7,785
Interest rate derivatives	—		84		—		84
Total assets	$	—	$	7,869	$	—	$	7,869
Commodity swaps	$	—	$	3,936	$	—	$	3,936
Interest rate derivatives	—		3,888		—		3,888
Contingent liability	—		—		65,400		65,400
Total liabilities	$	—	$	7,824	$	65,400	$	73,224

	December 31, 2023
	Level 1		Level 2		Level 3		Total
	(In thousands)
Commodity swap	$	—	$	3,663	$	—	$	3,663
Interest rate derivatives	—		4,314		—		4,314
Total assets	$	—	$	7,977	$	—	$	7,977
Commodity swaps	$	—	$	1,749	$	—	$	1,749
Interest rate derivatives	—		5,348		—		5,348
Total liabilities	$	—	$	7,097	$	—	$	7,097

Our derivative contracts consist of interest rate swaps and commodity swaps. The valuation of these derivative contracts involved both observable publicly quoted prices and certain credit valuation inputs that may not be readily observable in the marketplace. As such derivative contracts are classified as Level 2 in the hierarchy. Refer to Note 11—Derivatives and Hedging Activities in the Notes to Condensed Consolidated Financial Statements in this Quarterly Report on Form 10-Q for further discussion related to commodity swaps and interest rate derivatives.

The Company recorded a contingent liability related to the Kings Landing Earnout using Level 3 inputs, including projected spending and completion probability of the project. Refer to Note 15—Commitments and Contingencies in the Notes to Condensed Consolidated Financial Statements in this Quarterly Report on Form 10-Q for further discussion related to Kings Landing Earnout contingent liability.

Long-term debt’s carrying value can vary from fair value. See Note 7—Debt and Financing Costs in the Notes to Condensed Financial Statements for further information. The carrying amounts reported on the Condensed Consolidated Balance Sheets for the Company’s remaining financial assets and liabilities approximate fair value due to their short-term nature. There were no transfers between Level 1, Level 2 or Level 3 of the fair value hierarchy during the nine months ended September 30, 2024 and 2023.

11.    DERIVATIVES AND HEDGING ACTIVITIES

The Company is exposed to certain risks arising from both its business operations and economic conditions, and it enters into certain derivative contracts to manage exposure to these risks. To minimize counterparty credit risk in derivative instruments, the Company enters into transactions with high credit-rating counterparties. The Company did not elect to apply hedge accounting to these derivative contracts and recorded the fair value of the derivatives on the Condensed Consolidated Balance Sheets as of September 30, 2024 and December 31, 2023.

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Interest Rate Risk

The Company manages market risks, including interest rate, liquidity and credit risk primarily by managing the amount, sources and duration of its debt funding and by using derivative financial instruments. Specifically, the Company enters into derivative financial instruments to manage exposures that arise from activities that result in the payment of future known and uncertain cash amounts, the value of which is determined by interest rates.

The Company’s objectives in using interest rate derivatives are to add stability to interest expense and to manage its exposure to interest rate movements. To accomplish this objective, the Company primarily uses interest rate swaps as part of its interest rate risk management strategy. Interest rate swaps designated as cash flow hedges involve the receipt of variable amounts from a counterparty if interest rates rise above the strike rate on the contract.

As of September 30, 2024, the Company had two interest rate swap contracts with total notional amounts of $1.70 billion maturing on May 31, 2025 that pay a fixed rate ranging from 4.38% to 4.48% and one interest rate swap contract with a notional amount of $0.08 billion maturing on December 31, 2025 that pays a fixed rate of 3.02%. The fair value or settlement value of the consolidated interest rate swaps outstanding are presented on a gross basis on the Condensed Consolidated Balance Sheets. The following table presents the fair value of derivative assets and liabilities related to the interest rate swap contracts:

	September 30,		December 31,
	2024		2023
	(In thousands)
Derivatives assets - current	$	76	$	4,314
Derivative assets - noncurrent	8		—
Total derivative assets	$	84	$	4,314
Derivative liabilities - current	$	3,888	$	—
Derivatives liabilities - noncurrent	—		5,348
Total derivative liabilities	$	3,888	$	5,348

The Company recorded cash settlements and changes in fair value of the interest rate swap contracts in “Interest expense” of the Condensed Consolidated Statements of Operations. The following table presents interest rate swap derivatives activities for the three and nine months ended September 30, 2024 and 2023:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
	(In thousands)
Realized gain on interest rate swaps	$	3,994	$	4,665	$	11,899	$	7,082
(Unfavorable) favorable fair value adjustment	$	(8,342)	$	12,500	$	9,129	$	34,562

Commodity Price Risk

The results of the Company’s operations may be affected by the market prices of oil, natural gas and NGLs. A portion of the Company’s revenue is directly tied to local natural gas, natural gas liquids and condensate prices in the Permian Basin and the U.S. Gulf Coast. Fluctuations in commodity prices also impact operating cost elements both directly and indirectly. Management regularly reviews the Company’s potential exposure to commodity price risk and manages exposure of such risk through commodity hedge contracts.

During the past twelve months, the Company entered into multiple commodity swap contracts based on the OPIS NGL Mont Belvieu prices for ethane, propane and butane, the Waha Basis index, the HSC index and the NYMEX West Texas Intermediate Control index. These contracts are for various notional quantities of NGLs, natural gas and crude. Similarly, the Company has entered into various natural gas and crude basis spread swaps. These contracts are effective over the next 1 to 20 months and are used to hedge against location price risk of the respective commodity resulting from supply and demand volatility and protect cash flows against price fluctuations.

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The following table presents detailed information of commodity swaps outstanding as of September 30, 2024 (in thousands, except volumes):

	September 30, 2024
Commodity	Unit	Notional Volume	Net Fair Value
Natural Gas	MMBtus	1,210,000	$	569
NGL	Gallons	312,215,400	917
Crude	Bbl	613,000	2,563
Crude Collars	Bbl	163,800	937
Crude Basis Spread Swaps	Bbl	22,400	(9)
Natural Gas Basis Spread Swaps	MMBtus	7,300,000	(1,128)
			$	3,849

The fair value or settlement value of the swaps outstanding are presented on a gross basis on the Condensed Consolidated Balance Sheets. The following table presents the fair value of derivative assets and liabilities related to commodity swaps:

	September 30,		December 31,
	2024		2023
	(In thousands)
Derivatives assets - current	$	6,200	$	3,498
Derivative assets - noncurrent	1,585		165
Total derivative assets	$	7,785	$	3,663
Derivative liabilities - current	$	2,855	$	1,734
Derivatives liabilities - noncurrent	1,081		15
Total derivative liabilities	$	3,936	$	1,749

The Company recorded cash settlements and fair value adjustments on commodity swap derivatives in “Product revenue” of the Consolidated Statements of Operations. The following table presents commodity swap derivatives activities for the three and nine months ended September 30, 2024 and 2023:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
	(In thousands)
Realized (loss) gain on commodity swaps	$	(2,790)	$	176	$	(20,002)	$	8,029
Favorable (unfavorable) fair value adjustment	$	6,027	$	(8,083)	$	(18,067)	$	6,466

12.    SHARE-BASED COMPENSATION

The Company granted various Class A and Class C Shares, restricted stock units (“RSUs”) and performance stock units (“PSUs”) to members of the Board of Directors (the “Board”) and employees. The Class A Shares and Class C Shares and RSUs are subject to service requirements for vesting and the PSUs have both service requirements and market condition performance requirements for vesting. These units are recorded at grant-date fair value and compensation expense is recognized on a straight‑line or graded straight-line basis over the vesting period within “General and Administrative Expenses” of the Condensed Consolidated Statements of Operations in accordance with FASB ASC 718, Compensation - Stock Compensation. Forfeitures are recognized as they occur.

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Class A Shares and Class C Shares

The table below summarizes Class A Share and Class C Share activities for the nine months ended September 30, 2024:

	Number of Shares	Weighted Avg Grant-Date Fair Market Value Per Unit
Outstanding and unvested shares at December 31, 2023	5,444,488	$	28.91
Vested	43,166	31.18
Forfeited	1,592	31.18
Outstanding and unvested shares at September 30, 2024	5,399,730	$	28.90

Table below summarizes aggregate intrinsic value (market value at vesting date) and grant-date fair value of vested Class A Shares for the nine months ended September 30, 2024:

	Three Months Ended		Nine Months Ended
	September 30, 2024		September 30, 2024
	(In thousands)
Aggregate intrinsic value of vested Class A Shares	$	1,102	$	1,756
Grant-date fair value of vested Class A Shares	$	834	$	1,346

No vesting or forfeiture occurred for Class C Shares for the three and nine months ended September 30, 2024 and 2023. No vesting occurred for Class A Shares for the three and nine months ended September 30, 2023. As of September 30, 2024, there were $38.8 million of unrecognized compensation costs related to unvested Class A Shares and Class C Shares. These costs are expected to be recognized over a weighted average period of 1.16 years.

Restricted Stock Units

RSUs were granted to certain executives and employees under the Kinetik Holdings Inc. Amended and Restated 2019 Omnibus Compensation Plan (the “2019 Plan”) with various service vesting requirements. Such RSUs may be settled only for shares of Class A Common Stock on a one-for-one basis, contingent upon continued employment.

The table below summarizes RSUs activities for the nine months ended September 30, 2024:

	Number of Shares(1)	Weighted Avg Grant-Date Fair Market Value Per Unit(1)
Outstanding and unvested shares at December 31, 2023	435,220	$	31.15
Granted	610,333	35.41
Vested	323,158	34.79
Forfeited	12,565	33.06
Outstanding and unvested shares at September 30, 2024	709,830	$	33.12

(1)The number of shares and weighted average fair market value per share include RSUs issued to new employees that transitioned from ALTM as part of the merger as replacement awards.

Table below summarizes aggregate intrinsic value (market value at vesting date) and grant-date fair value of RSUs for the three and nine months ended September 30, 2024 and 2023.

	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
	(In thousands)
Aggregate intrinsic value of vested RSUs	$	387	$	34	$	11,469	$	7,340
Grant-date fair value of vested RSUs	$	372	$	35	$	11,243	$	6,827

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As of September 30, 2024, there were $13.0 million of unrecognized compensation costs related to the RSUs. These costs are expected to be recognized over a weighted average period of 1.64 years.

Performance Stock Units

The Company granted PSUs pursuant to the 2019 Plan to certain of its employees and executives during 2024. These PSUs vest and become earned upon the achievement of certain performance goals based on the Company’s annualized absolute total stockholder return and the Company’s relative total stockholder return as compared to the performance peer group during a three-year performance period. Depending on the results achieved during the three-year performance period, the actual number of Class A Common Stock that a holder of the PSUs earns at the end of the performance period may range from 0% to 200% of the target number of PSUs granted. The fair value of the PSUs is determined using a Monte Carlo simulation at the grant date. The Company recognized compensation expense for PSUs on a straight-line basis over the performance period. Any PSU not earned at the end of the performance period will be forfeited.

The table below summarizes PSU activities for the nine months ended September 30, 2024:

	Number of Shares	Weighted Avg Grant-Date Fair Market Value Per Unit
Granted in 2024	198,703	$	36.76
Outstanding and unvested shares at September 30, 2024	198,703	$	36.76

No vesting or forfeiture occurred for PSUs for the three and nine months ended September 30, 2024.

The table below presents a summary of the grant-date fair value assumptions used to value the PSUs on grant date:

	March 2024
Grant-date fair value per unit	$36.76
Beginning average price	$32.84
Risk-free interest rate	4.21%
Volatility factor	37%
Expected term	2.82 years

As of September 30, 2024, there were $5.8 million of unrecognized compensation costs related to the PSUs. These costs are expected to be recognized over a weighted average period of 2.25 years.

With respect to above Class A Shares, Class C Shares, RSUs and PSUs, the Company recorded compensation expenses of $15.2 million and $12.5 million for the three months ended September 30, 2024 and 2023, respectively, and $52.9 million and $43.3 million for the nine months ended September 30, 2024 and 2023.

13.    INCOME TAXES

The Company is subject to U.S. federal income tax and state taxes. Income tax expense included in the condensed consolidated financial statements in this Quarterly Report on Form 10-Q is as follows:

	Three Months Ended September 30,						Nine Months Ended September 30,
	2024			2023			2024			2023
	(In thousands)
Income before income taxes	$	91,914		$	44,434		$	249,270		$	121,128
Income tax expense	$	8,260		$	1,303		$	21,261		$	2,030
Effective tax rate	8.99		%	2.93		%	8.53		%	1.68		%

The effective tax rate for the three and nine months ended September 30, 2024 was lower than the statutory rate mainly due to the impact of tax attributable to noncontrolling interests related to the Common Unit limited partners.

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The effective tax rate for the three and nine months ended September 30, 2023 was lower than the statutory rate mainly due to the impact of tax attributable to noncontrolling interests related to the Common Unit limited partners and a full valuation allowance on deferred tax assets as of September 30, 2023.

14.    NET INCOME PER SHARE

The computation of basic and diluted net income per share for the periods presented in the condensed consolidated financial statements is shown in the tables below:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
	(In thousands, except per share amounts)
Net income attributable to Class A common shareholders	$	25,763	$	15,580	$	74,505	$	42,030
Less: Net income available to participating unvested restricted Class A common shareholders(1)	(4,755)		(4,414)		(13,636)		(12,996)
Total net income attributable to Class A common shareholders	$	21,008	$	11,166	$	60,869	$	29,034
Weighted average shares outstanding - basic	59,811		53,340		59,116		50,464
Dilutive effect of unvested Class A common shares(2)	613		123		736		255
Weighted average shares outstanding - diluted(2)(3)	60,424		53,463		59,852		50,719
Net income available per common share - basic	$	0.35	$	0.21	$	1.03	$	0.58
Net income available per common share - diluted	$	0.35	$	0.21	$	1.02	$	0.57

(1)Represents dividends paid to unvested Class A and Class C Shares, RSUs and PSUs.

(2)Includes dilutive effect from both RSUs and PSUs on unvested Class A common shares.

(3)The effect of an assumed exchange of outstanding Common Units (and the cancellation of a corresponding number of shares of outstanding Class C Common Stock) would have been anti-dilutive for all periods presented in which the Common Units were outstanding.

15.    COMMITMENTS AND CONTINGENCIES

Accruals for loss contingencies arising from claims, assessments, litigation, environmental and other sources are recorded when it is probable that a liability has been incurred and the amount can be reasonably estimated. These accruals are adjusted as additional information becomes available or circumstances change. As of September 30, 2024 and December 31, 2023, there were no accruals for loss contingencies.

Litigation

The Company is a party to various legal actions arising in the ordinary course of its business. In accordance with FASB ASC 450, Contingencies, the Company accrues reserves for outstanding lawsuits, claims and proceedings when a loss contingency is probable and can be reasonably estimated. The Company estimates the amount of loss contingencies using current available information from legal proceedings, advice from legal counsel and available insurance coverage. Due to the inherent subjectivity of the assessments and unpredictability of the outcomes of the legal proceedings, any amounts accrued or included in this aggregate amount may not represent the ultimate loss to the Company from the legal proceedings in question. There were no litigation-related accrued reserves as of September 30, 2024 and December 31, 2023.

The Company has entered into litigation with a third party to collect receivables totaling $11.6 million and is waiting on settlement of $8.0 million in outstanding vendor credits from another counterparty related to prior litigation the Company had previously entered into and subsequently dropped. These amounts remain outstanding from the Winter Storm Uri during February of 2021. Given the counterparties’ sufficient creditworthiness and the valid claims that we hold, no allowance has currently been established for these items as we have legally enforceable agreements with these parties.

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Environmental Matters

The Company is subject to various local, state, and federal laws and regulations relating to various environmental matters during the ordinary course of business. Although we believe our operations are in substantial compliance with applicable environmental laws and relations, risks of additional costs and liabilities are inherent in our operations. Moreover, changes in environmental laws and regulations occur frequently, and any changes that result in more stringent or costly requirements could require the Company to make significant expenditures to attain and maintain compliance or may otherwise have a material adverse effect on its operations, competitive position, or financial condition. The Company is not aware of any material environmental claims existing as of September 30, 2024, that have not been provided for or would otherwise have a material impact on its financial position, results of operations, or liquidity.

Contingent Liabilities

Durango Acquisition

On June 24, 2024, the Company consummated the previously announced Durango Acquisition. Pursuant to the Durango MIPA, Durango Seller is entitled to an earn out of up to $75.0 million in cash contingent upon the completion of the Kings Landing Project and placing it into service in Eddy County, New Mexico. This earn out is subject to reduction based on actual capital costs associated with the Kings Landing Project.

Upon Closing, the Company evaluated the earn-out consideration classification in accordance with ASC 480. The Company determined the earn-out consideration to be classified as a liability based on the settlement provision. As of Closing, the Company recorded an initial contingent liability of $64.0 million based on the project’s completion probability and projected spend. Pursuant to ASC 805, the Company recorded a subsequent fair value adjustment of $1.4 million within “Costs of sales (exclusive of depreciation and amortization)” of the Condensed Consolidated Statement of Operations for the three months ended September 30, 2024. The contingent liability associated with the Kings Landing Project was $65.4 million as of September 30, 2024.

Permian Gas Acquisition

As part of the acquisition of Permian Gas on June 11, 2019, consideration included a contingent liability arrangement with PDC Permian, Inc. (“PDC”). The arrangement requires additional monies to be paid by the Company to PDC on a per Mcf basis if the actual annual Mcf volume amounts exceed forecasted annual Mcf volume amounts starting in 2020 and continuing through 2029. The total monies paid under this arrangement are capped at $60.5 million and are payable on an annual basis over the earn-out period. PDC’s actual annual Mcf volume did not exceed the incentive forecast volume during the past four years, and is not expected to over the next five years; therefore, the estimated fair value of the contingent consideration liability was nil as of September 30, 2024 and December 31, 2023.

16.    SEGMENTS

Our two operating segments represent the Company’s segments for which discrete financial information is available and is utilized on a regular basis by our CODM to make key operating decisions, assess performance and allocate resources. These segments represent strategic business units with differing products and services. No operating segments have been aggregated to form the reportable segments. Therefore, our two operating segments represent our reportable segments. The activities of each of our reportable segments from which the Company earns revenues and incurs expenses are described below:

•Midstream Logistics: The Midstream Logistics segment operates under three streams, 1) gas gathering, processing and treating, 2) crude oil gathering, stabilization and storage services and 3) produced water gathering and disposal.

•Pipeline Transportation: The Pipeline Transportation segment consists of equity investment interests in three Permian Basin pipelines that access various points along the U.S. Gulf Coast, as well as Kinetik NGL and Delaware Link Pipelines. The current operating pipelines transport crude oil, natural gas and NGLs.

Our Chief Executive Officer, who is the CODM, uses Segment Adjusted EBITDA, a non-GAAP measure, to measure profitability and allocate resources among segments. Segment Adjusted EBITDA, a non-GAAP measure, is defined as segment net earnings adjusted to exclude interest expense, income tax expense, depreciation and amortization, the proportionate effect of these same items for our EMI pipelines and other non-recurring items. The CODM considers budget-to-actual and forecast-to-actual variances on a monthly basis when making decisions about allocating capital and personnel to the segments.

24

The Midstream Logistics segment accounts for more than 97% of the Company’s operating revenues, more than 99% of the cost of sales (excluding depreciation and amortization) and operating expenses and more than 94% of the ad valorem expenses. The Pipeline Transportation segment contains all of the Company’s equity method investments. Corporate and Other contains the Company’s executive and administrative functions, including 84% of the Company’s General and Administrative Expenses and all of the Company’s debt service costs. For the three months ended September 30, 2024, the Midstream Logistics segment and the Pipeline Transportation segment represent 65% and 36% of total consolidated adjusted EBITDA, respectively, which is consistent with the prior year contributions from each segment.

The following tables present the reconciliation of the non-GAAP measure Segment Adjusted EBITDA to the GAAP measure segment income (loss) before income taxes as of and for the three and nine months period ended September 30, 2024 and 2023:

	Midstream Logistics		Pipeline Transportation		Corporate and Other(1)		Consolidated
	(In thousands)
For the Three Months Ended September 30, 2024
Segment income (loss) before income taxes	$	88,581	$	88,797	$	(85,464)	$	91,914
Add back:
Interest expense	2,666		—		63,363		66,029
Depreciation and amortization expenses	85,273		2,305		5		87,583
Contract assets amortization	1,655		—		—		1,655
Proportionate EMI EBITDA	—		88,229		—		88,229
Share-based compensation	—		—		15,171		15,171
Contingent liabilities fair value adjustment	1,400		—		—		1,400
Integration costs	1,208		—		1,332		2,540
Acquisition transaction costs	—		—		31		31
Other one-time costs or amortization	1,657		—		2,060		3,717
Deduct:
Interest income	—		—		572		572
Commodity hedging unrealized gain	8,817		—		—		8,817
Gain on sale of equity method investment	—		29,953		—		29,953
Equity income from unconsolidated affiliates	—		53,244		—		53,244
Segment Adjusted EBITDA(2)	$	173,623	$	96,134	$	(4,074)	$	265,683

25

	Midstream Logistics		Pipeline Transportation		Corporate and Other(1)		Consolidated
	(In thousands)
For the Three Months Ended September 30, 2023
Segment income (loss) before income taxes	$	56,584	$	50,598	$	(62,748)	$	44,434
Add back:
Interest expense	12		—		44,997		45,009
Depreciation and amortization expenses	69,456		473		6		69,935
Contract assets amortization	1,655		—		—		1,655
Proportionate EMI EBITDA	—		78,585		—		78,585
Share-based compensation	—		—		12,502		12,502
Loss on disposal of assets	2,927		—		—		2,927
Unrealized loss on derivatives	8,259		—		—		8,259
Integration costs	21		—		—		21
Acquisition transaction costs	—		—		378		378
Other one-time costs or amortization	1,529		—		1,133		2,662
Warrant valuation adjustment	—		—		4		4
Deduct:
Interest income	—		—		293		293
Equity income from unconsolidated affiliates	—		50,754		—		50,754
Segment Adjusted EBITDA(2)	$	140,443	$	78,902	$	(4,021)	$	215,324

	Midstream Logistics		Pipeline Transportation		Corporate and Other(1)		Consolidated
	(In thousands)
For the Nine Months Ended September 30, 2024
Segment income (loss) before income taxes	$	215,196	$	275,246	$	(241,172)	$	249,270
Add back:
Interest expense	5,273		—		162,272		167,545
Depreciation and amortization expenses	229,336		6,897		17		236,250
Contract assets amortization	4,965		—		—		4,965
Proportionate EMI EBITDA	—		262,553		—		262,553
Share-based compensation	—		—		52,868		52,868
Loss on disposal of assets	4,090		—		—		4,090
Loss on debt extinguishment	—		—		525		525
Contingent liabilities fair value adjustment	1,400		—		—		1,400
Integration costs	1,792		—		3,299		5,091
Acquisition transaction costs	—		—		3,538		3,538
Other one-time costs or amortization	4,048		—		4,400		8,448
Deduct
Other interest income	—		—		1,459		1,459
Commodity hedging unrealized gain	1,935		—		—		1,935
Gain on sale of equity method investment	—		89,837		—		89,837
Equity income from unconsolidated affiliates	—		169,668		—		169,668
Segment Adjusted EBITDA(2)	$	464,165	$	285,191	$	(15,712)	$	733,644

26

	Midstream Logistics		Pipeline Transportation		Corporate and Other(1)		Consolidated
	(In thousands)
For the Nine Months Ended September 30, 2023
Segment income (loss) before income taxes	$	163,794	$	146,524	$	(189,190)	$	121,128
Add back:
Interest expense	32		—		130,411		130,443
Depreciation and amortization expenses	206,855		1,398		18		208,271
Contract assets amortization	4,965		—		—		4,965
Proportionate EMI EBITDA	—		224,933		—		224,933
Share-based compensation	—		—		43,340		43,340
Loss on disposal of assets	15,166		—		—		15,166
Unrealized loss on derivatives	616		—		—		616
Integration costs	29		—		956		985
Acquisition transaction costs	33		—		615		648
Other one-time costs or amortization	5,310		—		2,235		7,545
Deduct:
Interest income	—		—		314		314
Warrant valuation adjustment	—		—		73		73
Equity income from unconsolidated affiliates	—		146,828		—		146,828
Segment Adjusted EBITDA(2)	$	396,800	$	226,027	$	(12,002)	$	610,825

(1)Corporate and Other represents those results that: (i) are not specifically attributable to a reportable segment; (ii) are not individually reportable or (iii) have not been allocated to a reportable segment for the purpose of evaluating their performance, including certain General and Administrative Expense items. Items included here to reconcile operating segments profit and loss with the Company’s consolidated profit and loss.

(2)Segment adjusted EBITDA is a non-GAAP measure; please see Key Performance Metrics in “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations” in this Quarterly Report on Form 10-Q, for a definition and reconciliation to the GAAP measure.

The following tables present the revenue for the individual operating segments for the three and nine month period ended September 30, 2024 and 2023:

	Midstream Logistics		Pipeline Transportation		Elimination		Consolidated
	(In thousands)
For the Three Months Ended September 30, 2024
Revenue	$	391,331	$	2,192	$	—	$	393,523
Other revenue	2,837		2		—		2,839
Intersegment revenue(1)	—		6,748		(6,748)		—
Total segment operating revenue	$	394,168	$	8,942	$	(6,748)	$	396,362

	Midstream Logistics		Pipeline Transportation		Elimination		Consolidated
	(In thousands)
For the Three Months Ended September 30, 2023
Revenue	$	324,863	$	766	$	—	$	325,629
Other revenue	4,670		2		—		4,672
Total segment operating revenue	$	329,533	$	768	$	—	$	330,301

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	Midstream Logistics		Pipeline Transportation		Elimination		Consolidated
	(In thousands)
For the Nine Months Ended September 30, 2024
Revenue	$	1,082,236	$	6,566	$	—	$	1,088,802
Other revenue	8,122		289		—		8,411
Intersegment revenue(1)	—		19,288		(19,288)		—
Total segment operating revenue	$	1,090,358	$	26,143	$	(19,288)	$	1,097,213

	Midstream Logistics		Pipeline Transportation		Elimination		Consolidated
	(In thousands)
For the Nine Months Ended September 30, 2023
Revenue	$	894,669	$	2,190	$	—	$	896,859
Other revenue	10,679		6		—		10,685
Total segment operating revenue	$	905,348	$	2,196	$	—	$	907,544

(1)The Company accounts for intersegment sales at market prices, while it accounts for asset transfers at book value. Intersegment revenue is eliminated at consolidation.

The following table presents total assets for each operating segment as of September 30, 2024 and December 31, 2023:

	September 30,		December 31,
	2024		2023
	(In thousands)
Midstream Logistics	$	4,323,444	$	3,772,764
Pipeline Transportation(1)	2,297,544		2,703,588
Segment total assets	6,620,988		6,476,352
Corporate and other	239,473		20,521
Total assets	$	6,860,461	$	6,496,873

(1)Includes investment in unconsolidated affiliates of $2.14 billion and $2.54 billion as of September 30, 2024 and December 31, 2023, respectively.

17.    SUBSEQUENT EVENTS

On October 17, 2024, the Board declared a cash dividend of $0.78 per share on the Company’s Class A Common Stock which will be payable to stockholders of record as of October 28, 2024 on November 7, 2024. The Company, through its ownership of the general partner of the Partnership, declared a distribution of $0.78 per Common Unit from the Partnership to the holders of Common Units, which will be payable on November 7, 2024.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis addresses the results of our operations for the three and nine month period ended September 30, 2024, as compared to our results of operations for the same periods in 2023. Please read the following discussion of our financial condition and results of operations in conjunction with the financial statements and notes thereto included elsewhere in this report.

Overview

We are an integrated midstream energy company in the Permian Basin providing comprehensive gathering, transportation, compression, processing and treating services. Our core capabilities include a variety of service offerings including natural gas gathering, transportation, compression, treating and processing; NGLs stabilization and transportation; produced water gathering and disposal; and crude oil gathering, stabilization, storage and transportation. Our operations are strategically located in the heart of the Delaware Basin.

Our Operations and Segments

We have two reportable segments which are strategic business units with various products and services. The Midstream Logistics segment operates under three service offerings, 1) gas gathering and processing, 2) crude oil gathering, stabilization and storage services and 3) produced water gathering and disposal. The Pipeline Transportation segment consists of three EMI pipelines originating in the Permian Basin with various access points to the U.S. Gulf Coast, as well as Kinetik NGL and Delaware Link Pipelines. The pipelines transport natural gas, NGLs and crude oil within the Permian Basin and to the U.S. Gulf Coast.

Midstream Logistics

Gas Gathering and Processing. The Midstream Logistics segment provides gas gathering and processing services with over 3,900 miles of low and high-pressure steel pipeline located throughout the Delaware Basin, including over 2,300 miles of gas pipeline acquired through the Durango Acquisition, and over 570,000 horsepower of compression capacity. Gas processing assets are centralized at seven processing complexes with system-wide front-end amine treating capability, 6.5 Mmcfpd AGI capacity and total cryogenic processing capacity of approximately 2.2 Bcf/d as of today and over 2.4 BCF/d once the Kings Landing Project is complete in early 2025.

Crude Oil Gathering, Stabilization and Storage Services. Crude gathering assets are centralized at the Caprock Stampede Terminal and the Pinnacle Sierra Grande Terminal. The system includes approximately 220 miles of gathering pipeline and 90,000 barrels of crude storage.

Water Gathering and Disposal. The system includes over 360 miles of gathering pipeline and approximately 580,000 barrels per day of permitted disposal capacity.

Pipeline Transportation

EMI pipelines. The Company owns the following equity interests in three EMI pipelines in the Permian Basin with access to various points along the U.S. Gulf Coast: 1) an approximate 55.5% equity interest in Permian Highway Pipeline LLC (“PHP”), which is operated by Kinder Morgan; 2) 33.0% equity interest in Breviloba, LLC (“Breviloba”), the owner of the Shin Oak NGL Pipeline (“Shin Oak”), which is operated by Enterprise Products Operating LLC; and 3) 27.5% equity interest in Epic Crude Holdings, LP (“EPIC”), which is operated by EPIC Consolidated Operations, LLC.

Kinetik NGL Pipelines. The Kinetik NGL Pipelines consist of approximately 96 miles of NGL pipelines connecting our East Toyah and Pecos complexes to Waha, including our 20-inch Dewpoint pipeline that spans over 40 miles, and our 30 mile, 16-inch Brandywine Pipeline connecting to our Diamond Cryogenic complex. The Kinetik NGL pipeline system has a capacity of approximately 560 MBbl/d.

Delaware Link Pipeline. The Delaware Link Pipeline consists of approximately 40 miles of 30-inch diameter pipeline with an initial capacity of approximately 1.0 Bcf/d that provides additional transportation capacity to Waha. The project reached commercial in-service in October 2023.

29

Recent Developments

EPIC Equity Interest

During the third quarter, the Company consummated the Equity Sale and Purchase Agreement with Dos Rios Crude Intermediate LLC (“Seller”) to purchase a 12.5% of equity interest in EPIC. The acquisition of additional interest is accounted for as a business acquisition pursuant to ASC 805. After completion of the transaction, the Company owned a 27.5% equity interest in EPIC as of September 30, 2024. EPIC has over 800 miles of pipeline connecting the Delaware and Midland Basins and has a capacity of 625 MBbl/d.

Durango Acquisition

On June 24, 2024, the Company consummated the previously announced Durango Acquisition for an adjusted purchase price of approximately $845.2 million, consisting of (i) $358.0 million of cash consideration paid at closing, (ii) approximately 3.8 million shares of Class C Common Stock and an equivalent number of OpCo Units, issued at closing and (iii) approximately 7.7 million shares of Class C Common Stock and an equivalent number of OpCo Units to be issued on July 1, 2025. Durango Seller is also entitled to an earn out of up to $75.0 million in cash contingent upon the completion and placing into service of the Kings Landing Project in Eddy County, New Mexico, which is currently under construction. This earn out is subject to reduction based on actual capital costs associated with the Kings Landing Project. This transaction was accounted for as a business combination pursuant to ASC 805. Refer to Note 2—Business Combinations in the Notes to our Condensed Consolidated Financial Statements for further information.

The Durango Acquisition significantly expands Kinetik’s footprint into New Mexico and the Northern Delaware Basin, expanding Kinetik’s processing capacity by over 200 MMcf/d and doubling its existing gathering pipeline mileage. An additional 200 MMcf/d of processing capacity will be added upon completion of the Kings Landing Project.

GCX Divestiture

On June 4, 2024, the Company consummated the previously announced transaction contemplated by the GCX Purchase Agreement to sell its 16% equity interest in GCX for an adjusted purchase price of $524.4 million (the "GCX Sale"), including an additional $30.0 million earn out in cash upon the approval by the GCX Board of Directors of one or more capital projects that achieve certain capacity expansion criteria. Net cash proceeds of $494.4 million were received from the GCX Buyer on June 4, 2024 and the cash earn out was received in September 2024. The Company recognized a gain of $89.8 million upon closing of the GCX Sale.

Factors Affecting Our Business

Commodity Price Volatility

There has been, and we believe there will continue to be, volatility in commodity prices and in the relationships among NGLs, crude oil and natural gas prices. As a result of uncertainty around global commodity supply and demand, the current conflict in Israel and the Gaza Strip and elsewhere in the Middle East, as well as the ongoing armed conflict in Ukraine, global oil and natural gas commodity prices continue to remain volatile. The volatility and uncertainty of natural gas, crude oil and NGL prices impact drilling, completion and other investment decisions by producers and ultimately supply to our systems. Although ongoing armed conflicts might generate commodity price upward pressure, and our operations could benefit in an environment of higher natural gas, NGLs and condensate prices, the instability of the international political environment and human and economic hardship resulting from the conflicts would have a highly uncertain impact on the U.S. economy, which in turn, might affect our business and operations adversely. Our product sales revenue is exposed to commodity price fluctuations. Therefore, commodity price decline and sustained periods of low natural gas and NGL prices could have an adverse effect on our product revenue stream. The Company continues to monitor commodity prices closely and may enter into commodity price hedges from time to time as necessary to mitigate the volatility risk. In addition, the Company, when economically appropriate, enters into fee-based arrangements that insulate the Company from commodity price volatility.

30

Inflation and Interest Rates

The annual rate of inflation in the United States was 2.4% in September 2024 as measured by the Consumer Price Index. In light of the recent economic activity, unemployment level and progress on lowering inflation, the Federal Open Market Committee (“FOMC”) decided to lower the target range for the federal funds rate by 0.50% to 4.75% - 5.00% during its meeting in September 2024. During the meeting, the FOMC noted that the economic outlook is uncertain and the Committee is attentive to the risks to both sides of its dual mandate. If interest rates elevated beyond the term of our hedges, our financing cost will increase and could have a negative impact on the Company’s ability to meet its contractual debt obligations and to fund its operating expenses and capital expenditures. The Company will continue to monitor the FOMC’s monetary policy and interest rate movement. Refer to Note 11—Derivatives and Hedging Activities in the Notes to Condensed Consolidated Financial Statements in this Quarterly Report on Form 10-Q for additional discussion regarding our hedging strategies and objectives for interest rate risk.

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Results of Operations

The following table presents the Company’s results of operations for the periods presented:

	Three Months Ended September 30,						Nine Months Ended September 30,
	2024		2023		% Change		2024		2023		% Change
	(In thousands, except percentages)
Revenues:
Service revenue	$	103,100	$	104,349	(1	%)	$	301,710	$	310,325	(3	%)
Product revenue	290,423		221,280		31	%	787,092		586,534		34	%
Other revenue	2,839		4,672		(39	%)	8,411		10,685		(21	%)
Total revenues	396,362		330,301		20	%	1,097,213		907,544		21	%
Operating costs and expenses:
Cost of sales (exclusive of depreciation and amortization) (1)	144,586		147,756		(2	%)	444,786		374,100		19	%
Operating expense	55,804		42,925		30	%	143,278		118,804		21	%
Ad valorem taxes	5,896		5,607		5	%	18,400		14,954		23	%
General and administrative	29,619		22,751		30	%	94,846		73,131		30	%
Depreciation and amortization expense	87,583		69,935		25	%	236,250		208,271		13	%
Loss on disposal of assets	—		2,927		(100	%)	4,090		15,166		(73	%)
Total operating costs and expenses	323,488		291,901		11	%	941,650		804,426		17	%
Operating income	72,874		38,400		90	%	155,563		103,118		51	%
Other income (expense):
Interest and other income	1,872		289		NM		2,272		1,625		40	%
Loss on debt extinguishment	—		—		—	%	(525)		—		100	%
Gain on sale of equity method investments	29,953		—		100	%	89,837		—		100	%
Interest expense	(66,029)		(45,009)		47	%	(167,545)		(130,443)		28	%
Equity in earnings of unconsolidated affiliates	53,244		50,754		5	%	169,668		146,828		16	%
Total other income, net	19,040		6,034		NM		93,707		18,010		NM
Income before income taxes	91,914		44,434		107	%	249,270		121,128		106	%
Income tax expense	8,260		1,303		NM		21,261		2,030		NM
Net income including noncontrolling interest	$	83,654	$	43,131	94	%	$	228,009	$	119,098	91	%

(1)Cost of sales (exclusive of depreciation and amortization) is net of gas service revenues totaling $60.2 million and $38.6 million for the three months ended September 30, 2024 and 2023, respectively, and $159.4 million and $107.1 million for the nine months ended September 30, 2024 and 2023, respectively, for certain volumes, where we act as principal.

NM - Not meaningful

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Three Months Ended September 30, 2024 Compared to Three Months Ended September 30, 2023

Revenues

For the three months ended September 30, 2024, revenue increased $66.1 million, or 20%, to $396.4 million, compared to $330.3 million for the same period in 2023. The increase was primarily driven by higher product revenue related to increased natural gas residue volumes sold and increased gathered and processed gas volumes.

Service revenue

Service revenue consists of service fees paid to us by our customers for providing comprehensive gathering, treating, processing and produced water disposal services necessary to bring natural gas, NGLs and crude oil to market. Service revenue for the three months ended September 30, 2024, decreased by $1.2 million, or 1%, to $103.1 million, compared to $104.3 million for the same period in 2023. This decrease was driven by lower period-over-period gas gathering fees of $1.7 million. Period-over-period gathered and processed gas volumes increased by 212.3 Mcf per day, or 12% and by 238.7 Mcf per day, or 16%, respectively. Of the increase, Durango’s operation accounted for 207.2 Mcf per day and 195.8 Mcf per day of gathered and processed gas volume, respectively. However, the total gathered and processed gas volumes where we function as the agent decreased period over period causing the change in net gas gathering fees presented as revenues to be down 2%. Over 91% of service revenues are included in the Midstream Logistics segment.

Product revenue

Product revenue consists of commodity sales (including condensate, natural gas residue and NGLs). Product revenue for the three months ended September 30, 2024, increased by $69.1 million, or 31%, to $290.4 million, compared to $221.3 million for the same period in 2023, primarily due to increased residue gas volumes sold and higher commodity prices. Period over period natural gas residue volumes sold increased 36.1 million MMBtu, of which, Durango’s operations accounted for 14.2 million MMBtu. Partially offsetting this increase, NGL and condensate volumes sold decreased 2.0 million barrels, or 24%. Product revenues are included entirely in the Midstream Logistics segment.

Operating Costs and Expenses

Operating expenses

Operating expenses increased by $12.9 million, or 30%, to $55.8 million for the three months ended September 30, 2024, compared to $42.9 million for the same period in 2023. Of the total increase, $11.7 million was driven by Durango’s operations that were acquired during June 2024. Over 99% of operating expenses are included in the Midstream Logistics segment.

General and administrative expenses

General and administrative expenses increased by $6.9 million, or 30% to $29.6 million for the three months ended September 30, 2024, compared to $22.8 million for the same period in 2023. The increase was mainly driven by increases in share-based compensation of $2.7 million due to new RSUs and PSUs granted during 2024 and Durango integration costs of $2.2 million. The remaining $2.0 million increase primarily relates to higher internal labor and insurance expenses that have resulted from the overall growth of the organization.

Depreciation and amortization expense

Depreciation and amortization expense increased by $17.6 million, or 25% to $87.6 million for the three months ended September 30, 2024, compared to $69.9 million for the same period in 2023. Of the total increase, $12.8 million was driven by the Durango Acquisition that was completed during June of 2024. The remaining increase was driven by assets placed in service since third quarter of 2023, primarily related to the Delaware Link Pipeline that was placed in service in October 2023.

Other Income (Expense)

Gain on sale of equity method investment

Gain on sale of equity method investment increased by $30.0 million, or 100%, for the three months ended September 30, 2024. The increase was related to the cash earn out received in September 2024 related to the GCX Sale.

33

Interest expense

Interest expense increased by $21.0 million, or 47%, to $66.0 million for the three months ended September 30, 2024. The increase was primarily driven by an unrealized loss on interest rate swaps of $12.3 million during the three months ended September 30, 2024 versus an unrealized gain on interest rate swaps of $7.8 million during the same period in 2023. Refer to Note—11 Derivatives and Hedging Activities in the Notes to Condensed Consolidated Financial Statements regarding the Company’s strategy in managing interest rate risk.

Nine Months Ended September 30, 2024 Compared to Nine Months Ended September 30, 2023

Revenues

For the nine months ended September 30, 2024, revenue increased $189.7 million, or 21%, to $1,097.2 million, compared to $907.5 million for the same period in 2023. The increase was primarily driven by higher period-over-period product revenue due to increased natural gas residue volumes sold and increased gathered and processed gas volumes.

Service revenue

Service revenue consists of service fees paid to us by our customers for providing comprehensive gathering, treating, processing and water disposal services necessary to bring natural gas, NGLs and crude oil to market. Service revenue for the nine months ended September 30, 2024, decreased by $8.6 million, or 3%, to $301.7 million, compared to $310.3 million for the same period in 2023. The decrease was primarily driven by lower period-over-period gas gathering fees of $8.2 million. Total gathered and processed gas volumes increased 171.1 Mcf per day, or 10% and 188.0 Mcf per day, or 13%, respectively. Of the increase, Durango’s operations accounted for 74.8 Mcf per day and 70.6 Mcf per day of gathered and processed gas volume, respectively. However, the total gathered and processed gas volumes where we function as the agent decreased period over period causing the change in net gas gathering fees presented as revenues to be down 3%. Over 91% of service revenues are included in the Midstream Logistics segment.

Product revenue

Product revenue consists of commodity sales (including condensate, natural gas residue and NGLs). Product revenue for the nine months ended September 30, 2024, increased by $200.6 million, or 34%, to $787.1 million, compared to $586.5 million for the same period in 2023, primarily due to a period-over-period increase in residue gas volumes sold. Natural gas residue sales volumes increased 59.6 million MMBtu, of which Durango’s operations accounted for 14.6 million MMBtu. The increase was also driven by a period over period increase in NGL prices of $8.46 per barrel, or 39%. The overall increase was partially offset by decreases in NGL and condensate volumes sold of 4.3 million barrels, or 19% and a decrease in natural gas prices of $0.42 per MMBtu, or 25%. Product revenues are included entirely in the Midstream Logistics segment.

Operating Costs and Expenses

Costs of sales (exclusive of depreciation and amortization)

Cost of sales (exclusive of depreciation and amortization) primarily consists of purchases of NGLs and natural gas from our producers at contracted market prices to support product sales to other third parties. For the nine months ended September 30, 2024, cost of sales increased $70.7 million, or 19%, to $444.8 million, compared to $374.1 million for the same period in 2023. As discussed above, the increase was primarily driven by period to period increases in natural gas residue volumes sold, slightly offset by a decrease in NGL and condensate volumes sold as well as lower natural gas prices. Over 99% of cost of sales (exclusive of depreciation and amortization) is included entirely in the Midstream Logistics segment.

Operating Expense

Operating expenses increased by $24.5 million, or 21%, to $143.3 million for the nine months ended September 30, 2024, compared to $118.8 million for the same period in 2023. Of the total increase, $12.7 million was driven by Durango’s operations that were acquired during June of 2024. The remaining increase was primarily driven by increases in internal labor, repairs and maintenance and lubricants and chemicals totaling $9.8 million, which was related to the increased gathered and processed volumes during 2024. Over 99% of operating expenses are included in the Midstream Logistics segment.

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General and administrative expenses

General and administrative expenses increased by $21.7 million, or 30% to $94.8 million for the nine months ended September 30, 2024, compared to $73.1 million for the same period in 2023. The increase was mainly driven by higher share-based compensation of $9.5 million due to new RSUs and PSUs granted during 2024 and $7.9 million of integration and transaction costs associated with the 2024 Durango and Epic transactions. The remaining $4.3 million increase primarily relates to higher internal labor and insurance expenses that have resulted from the overall growth of the organization.

Depreciation and amortization expense

Depreciation and amortization expense increased by $28.0 million, or 13% to $236.3 million for the nine months ended September 30, 2024, compared to $208.3 million for the same period in 2023. Of the total increase, $13.6 million was driven by Durango Acquisition that was completed during June of 2024. The remaining increase was driven by assets placed in service since third quarter of 2023, primarily related to the Delaware Link Pipeline that was placed in service in October 2023 and the rich gas lateral into Lea County, New Mexico.

Loss on disposal of assets

Loss on disposal of asset decreased by $11.1 million, or 73% to $4.1 million for the nine months ended September 30, 2024, compared to $15.2 million for the same period in 2023. The decrease was mainly due to the write off of obsolete gathering and processing systems and facilities of $11.8 million in 2023, but no similar write off took place in 2024.

Other Income (Expense)

Gain on sale of equity method investment

Gain on sale of equity method investment increased by $89.8 million, or 100%, for the nine months ended September 30, 2024, compared to the same period in 2023. The increase was related to the GCX Sale consummated in the second quarter of 2024.

Interest Expense

Interest expense increased by $37.1 million, or 28%, to $167.5 million for the nine months ended September 30, 2024, compared to $130.4 million for the same period in 2023. The increase was driven by a decrease in capitalized interest expense of $8.9 million given the completion of the PHP expansion in December of 2023, and an unrealized loss on interest rate swaps of $2.8 million during the nine months ended September 30, 2024 versus an unrealized gain on interest swaps of $27.5 million during the same period in 2023. Refer to Note—11 Derivatives and Hedging Activities in the Notes to Condensed Consolidated Financial Statements regarding the Company’s strategy in managing interest rate risk.

Equity in earnings of unconsolidated affiliates

Income from EMI pipelines increased by $22.8 million, or 16%, to $169.7 million for the nine months ended September 30, 2024, compared to $146.8 million for the same period in 2023. An increase of $35.9 million was driven by higher profitability from the Company’s investment in PHP due to its expanded capacity that was placed into service in December 2023. This increase was partially offset by the decrease in equity in earnings of unconsolidated affiliates from GCX due to the GCX sale consummated in the second quarter of 2024.

Income Tax Expense

Income tax expense increased by $19.2 million for the nine months ended September 30, 2024 compared to the same period in 2023. The increase was primarily due to the release of the valuation allowance against deferred tax assets in December 2023 and the recognition of deferred federal income tax of $18.4 million for nine months ended September 30, 2024 compared to nil for the same period in 2023.

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Key Performance Metrics

Adjusted EBITDA

Adjusted EBITDA is defined as net income including noncontrolling interests adjusted for interest, taxes, depreciation and amortization, gain or loss on disposal of assets and debt extinguishment, the proportionate EBITDA from our EMI pipelines, equity income and gain from sale of investments recorded using the equity method, share-based compensation expense, noncash increases and decreases related to hedging activities, fair value adjustments for contingent liabilities, integration and transaction costs and extraordinary losses and unusual or non-recurring charges. Adjusted EBITDA provides a basis for comparison of our business operations between current, past and future periods by excluding items that we do not believe are indicative of our core operating performance.

We believe that Adjusted EBITDA provides a meaningful understanding of certain aspects of earnings before the impact of investing and financing charges and income taxes. Adjusted EBITDA is useful to an investor in evaluating our performance because this measure:

•is widely used by analysts, investors and competitors to measure a company’s operating performance;

•is a financial measurement that is used by rating agencies and other parties to evaluate our credit worthiness; and

•is used by our management for various purposes, including as a basis for strategic planning and forecasting.

Adjusted EBITDA is not defined in GAAP

The GAAP measure used by the Company that is most directly comparable to Adjusted EBITDA is net income including noncontrolling interest. Adjusted EBITDA should not be considered as an alternative to the GAAP measure of net income including noncontrolling interest or any other measure of financial performance presented in accordance with GAAP. Adjusted EBITDA has important limitations as an analytical tool because it excludes some, but not all, items that affect net income including noncontrolling interest. Adjusted EBITDA should not be considered in isolation or as a substitute for analysis of the Company’s results as reported under GAAP. The Company’s definition of Adjusted EBITDA may not be comparable to similarly titled measures of other companies in the industry, thereby diminishing its utility.

Reconciliation of non-GAAP financial measure

Company management compensates for the limitations of Adjusted EBITDA as an analytical tool by reviewing the comparable GAAP measure, understanding the differences between Adjusted EBITDA as compared to net income including noncontrolling interest, and incorporating this knowledge into its decision-making processes. Management believes that investors benefit from having access to the same financial measure that the Company uses in evaluating operating results.

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The following table presents a reconciliation of the GAAP financial measure of net income including noncontrolling interest to the non-GAAP financial measure of Adjusted EBITDA.

	Three Months Ended September 30,						Nine Months Ended September 30,
	2024		2023		% Change		2024		2023		% Change
	(In thousands, except percentages)
Reconciliation of net income including noncontrolling interest to Adjusted EBITDA
Net income including noncontrolling interest	$	83,654	$	43,131	94	%	$	228,009	$	119,098	91	%
Add back:
Interest expense	66,029		45,009		47	%	167,545		130,443		28	%
Income tax expense	8,260		1,303		NM		21,261		2,030		NM
Depreciation and amortization expenses	87,583		69,935		25	%	236,250		208,271		13	%
Amortization of contract costs	1,655		1,655		—	%	4,965		4,965		—	%
Proportionate EMI EBITDA	88,229		78,585		12	%	262,553		224,933		17	%
Share-based compensation	15,171		12,502		21	%	52,868		43,340		22	%
Loss on disposal of assets	—		2,927		(100	%)	4,090		15,166		(73	%)
Loss on debt extinguishment	—		—		—	%	525		—		100	%
Commodity hedging unrealized loss	—		8,259		(100	%)	—		616		(100	%)
Contingent liability fair value adjustment	1,400		—		100	%	1,400		—		100	%
Integration costs	2,540		21		NM		5,091		985		NM
Acquisition transaction costs	31		378		(92	%)	3,538		648		NM
Other one-time cost or amortization	3,717		2,662		40	%	8,448		7,545		12	%
Warrant valuation adjustment	—		4		(100	%)	—		—		—	%
Deduct:
Interest income	572		293		95	%	1,459		314		NM
Warrant valuation adjustment	—		—		—	%	—		73		(100	%)
Commodity hedging unrealized gain	8,817		—		100	%	1,935		—		100	%
Gain on sale of equity method investment	29,953		—		100	%	89,837		—		100	%
Equity income from EMI's	53,244		50,754		5	%	169,668		146,828		16	%
Adjusted EBITDA	$	265,683	$	215,324	23	%	$	733,644	$	610,825	20	%

NM - not meaningful

Adjusted EBITDA increased by $50.4 million, or 23%, to $265.7 million for the three months ended September 30, 2024, compared to $215.3 million for the same period in 2023. As discussed in the Item 2.Management’s Discussion and Analysis of Financial Condition and Results of Operations—Results of Operations to this Quarterly Report on Form 10-Q, $49.2 million of the increase was due to increased total operating revenue of $66.1 million, partially offset by increased cost of sales (exclusive of depreciation and amortization), operating expenses, ad valorem taxes and general and administrative expense of $16.9 million. The remaining increases were primarily driven by higher proportionate EMI EBITDA of $9.6 million and higher non-cash amortizations or other one-time costs of $8.6 million. These increases were partially offset by a decrease of $17.1 million related to unrealized commodity hedging activities.

Adjusted EBITDA increased by $122.8 million, or 20%, to $733.6 million for the nine months ended September 30, 2024, compared to $610.8 million for the same period in 2023. As discussed in the Item 2.Management’s Discussion and Analysis of Financial Condition and Results of Operations—Results of Operations to this Quarterly Report on Form 10-Q, $69.3 million of the increase was due to increased total operating revenue of $189.7 million, partially offset by increased cost of sales (exclusive of depreciation and amortization), operating expenses, ad valorem taxes and general and administrative expenses of $120.3 million. The increase was also driven by (i) higher proportionate EMI EBITDA of $37.6 million primarily related to the expanded capacity at PHP that was placed into service during December 2023 and (ii) increases related to stock based compensation of $9.5 million and integration, transaction and other one-time costs of $7.9 million, which was mainly related to the Durango Acquisition completed in June 2024.

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Segment Adjusted EBITDA

Segment Adjusted EBITDA is defined as segment net earnings adjusted to exclude interest expense, income tax expense, depreciation and amortization, the proportionate effect of these same items for our equity method investments and other non-recurring items. The following table presents Segment Adjusted EBITDA for the three and nine months ended September 30, 2024 and 2023. Also refer to Note 16—Segments in the Notes to Condensed Consolidated Financial Statements in this Quarterly Report on Form 10-Q for a reconciliation of Segment Adjusted EBITDA to net income before income taxes.

	Three Months Ended September 30,						Nine Months Ended September 30,
	2024		2023		% Change		2024		2023		% Change
	(In thousands, except percentages)
Midstream Logistics	$	173,623	$	140,443	24	%	$	464,165	$	396,800	17	%
Pipeline Transportation	96,134		78,902		22	%	285,191		226,027		26	%
Corporate and Other(1)	(4,074)		(4,021)		1	%	(15,712)		(12,002)		31	%
Total Segment Adjusted EBITDA	$	265,683	$	215,324	23	%	$	733,644	$	610,825	20	%

(1)Corporate and Other represents those results that: (i) are not specifically attributable to a reportable segment; (ii) are not individually reportable or (iii) have not been allocated to a reportable segment for the purpose of evaluating their performance, including certain general and administrative expense items.

Midstream Logistics Segment Adjusted EBITDA increased by $33.2 million to $173.6 million for the three months ended September 30, 2024, compared to $140.4 million for the same period in 2023. The increase was primarily due to the increased total operating revenue of $57.9 million, partially offset by increased operating expense and ad valorem taxes of $12.7 million and a decrease of $17.1 million related to unrealized commodity hedging activities. The reasons for the fluctuations are discussed in Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations—Results of Operations to this Quarterly Report on Form 10-Q.

Midstream Logistics Segment Adjusted EBITDA increased by $67.4 million to $464.2 million for the nine months ended September 30, 2024, compared to $396.8 million for the same period in 2023. The increase was primarily due to the increased total operating revenue of $165.7 million, partially offset by increases in cost of sales (exclusive of depreciation and amortization) of $70.7 million and operating expense and ad valorem taxes of $26.2 million. The reasons for the fluctuations are discussed in Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations—Results of Operations to this Quarterly Report on Form 10-Q.

Pipeline Transportation Segment Adjusted EBITDA increased by $17.2 million to $96.1 million for the three months ended September 30, 2024, compared to $78.9 million for the same period in 2023. The increase was primarily driven by higher proportionate EMI EBITDA of $9.6 million due to increased profitability at PHP related to expanded capacity that was placed into service starting in December 2023. The increase was also driven by the increase in operating revenue of $8.2 million primarily related to the Delaware Link Pipeline going into service during October 2023. The reasons for the fluctuations are discussed in Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations—Results of Operations to this Quarterly Report on Form 10-Q.

Pipeline Transportation Segment Adjusted EBITDA increased by $59.2 million to $285.2 million for the nine months ended September 30, 2024, compared to $226.0 million for the same period in 2023. The increase was primarily driven by higher proportionate EMI EBITDA of $37.6 million due to increased profitability at PHP related to expanded capacity that was placed into service starting in December 2023. The remaining increase was driven by increased operating revenue of $23.9 million primarily related to the Delaware Link Pipeline going into service during October 2023. The reasons for the fluctuations are discussed in Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations—Results of Operations to this Quarterly Report on Form 10-Q.

Contractual Obligations

We have contractual obligations for principal and interest payments on our 2028 Notes, 2030 Notes, and under the Term Loan Credit Facility, Revolving Credit Facility and A/R Facility. See Note 7—Debt and Financing Costs in the Notes to Condensed Consolidated Financial Statements in this Quarterly Report on Form 10-Q.

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Under certain clauses of our transportation services agreements with third party pipelines to transport natural gas and NGLs, if we fail to ship a minimum throughput volume, then we will pay certain deficiency payments for transportation based on the volume shortfall up to the MVC amount.

Capital Resources and Liquidity

The Company’s primary use of capital since inception has been for the initial construction of gathering and processing assets, as well as the acquisitions of businesses and EMI pipelines and associated subsequent construction costs. For 2024, the Company’s primary spending requirements are related to the business acquisitions and other budgeted capital expenditures for construction and maintenance of gathering and processing assets, the Company’s contractual debt obligations and quarterly cash dividends. In addition, the Company may repurchase its Class A Common Stock pursuant to the Share Repurchase Program from time to time.

During the nine months ended September 30, 2024, the Company’s primary sources of cash were distributions from the EMI pipelines, borrowings under the Revolving Credit Facility and A/R Facility, proceeds from the GCX Sale and cash generated from operations. Based on the Company’s current financial plan, the Company believes that cash from operations and distributions from the EMI pipelines, and remaining borrowing capacity on our credit facilities will generate cash flows in excess of capital expenditures and the amount required to fund the Company’s planned quarterly dividend over the next 12 months.

A/R Facility

Pursuant to the A/R Facility, the Company and certain of its subsidiaries continuously transfer receivables to Kinetik Receivables and Kinetik Receivables transfers receivables that meet certain qualifying conditions to third-party purchasers in exchange for cash. These receivables are held by Kinetik Receivables and are pledged to secure the collectability of the sold receivables and are accounted for as secured borrowings. The amount available for borrowing at any one time under the A/R Facility is limited to an amount calculated based on the outstanding balance of eligible receivables sold to the purchasers, subject to certain reserves, concentration limits, and other limitations. As of September 30, 2024, eligible accounts receivable of $150.0 million was pledged to the A/R Facility as collateral.

The net proceeds of the A/R Facility were used, together with cash on hand, to repay a portion of the outstanding borrowings under the Term Loan Credit Facility during the second quarter 2024, lowering the remaining balance to $1.00 billion. As a result, the maturity of the Term Loan Credit Facility extended to December 8, 2026.

Capital Requirements and Expenditures

Our operations can be capital intensive, requiring investments to expand, upgrade, maintain or enhance existing operations and to meet environmental and operational regulations. During the nine months ended September 30, 2024 and 2023, capital spending for property, plant and equipment totaled $155.8 million and $245.8 million, respectively, intangible asset purchases totaled $7.7 million and $15.1 million, respectively, and contributions to EMI totaled $3.3 million and $202.7 million, respectively. The decrease in capital spending was mainly due to completion of the Delaware Link Pipeline and PHP expansion projects in the second half of 2023. Management believes its existing gathering, processing and transmission infrastructure capacity and future planned projects are capable of fulfilling its midstream contracts to service its customers.

The Company anticipates its existing capital resources will be sufficient to fund the future capital expenditures for EMI pipelines and the Company’s existing infrastructure assets over the next 12 months. For further information on EMIs, refer to Note 6—Equity Method Investments in the Notes to Condensed Consolidated Financial Statements in this Quarterly Report on Form 10-Q.

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Cash Flow

The following tables present cash flows from operating, investing and financing activities during the periods presented:

	Nine Months Ended September 30,
	2024		2023
	(In thousands)
Cash provided by operating activities	$	493,356	$	405,585
Cash used in investing activities	$	(65,909)	$	(582,600)
Cash (used in) provided by financing activities	$	(411,519)	$	170,689

Operating activities. Net cash provided by operating activities increased by $87.8 million for the nine months ended September 30, 2024 compared with the same period in 2023. The change in the operating cash flows reflected (i) an increase in net income including noncontrolling interests of $108.9 million; (ii) a decrease in adjustments related to non-cash items of $20.8 million, which was mainly driven by a gain of $89.8 million recognized on the GCX Sale and an increase in equity in earnings from EMI of $22.8 million, partially offset by increases in distribution from EMIs of $17.8 million, deferred income taxes of $18.1 million, depreciation and amortization expense of $28.0 million and a decrease in favorable derivative activities adjustments of $26.8 million and (iii) a decrease in working capital of $0.4 million.

Investing activities. Net cash used in investing activities decreased by $516.7 million for the nine months ended September 30, 2024 compared with the same period in 2023. The decrease was primarily driven by cash proceeds from the GCX Sale of $524.4 million, lower capital expenditures of $97.3 million and a reduction of investments in EMIs of $199.5 million as the PHP expansion project was completed and put into service in December 2023, partially offset by net cash used in the Durango Acquisition and net cash used in the acquisition of additional equity interests in EPIC.

Financing activities. Net cash used in financing activities was $411.5 million for the nine months ended September 30, 2024, which was primarily comprised of net payments on the Partnership’s Term Loan, Revolving Credit Facility and A/R Facility of $138.6 million and cash dividend of $272.9 million paid to the holders of Class A Common Stock and Common Units, compared with net cash provided by financing activities of $170.7 million for the nine months ended September 30, 2023, which was primarily comprised of net proceeds from the Partnership’s Revolving Credit Facility of $235.0 million and cash dividend of $58.6 million paid to the holders of Class A Common Stock and Common Units. Significant increase in cash dividend paid in the first nine months of 2024 compared to the same period in 2023 was mainly due to the expiration of the Reinvestment Agreement on March 8, 2024, as such Reinvestment Holders are not obligated to reinvest a specified percent of all distributions on Common Units or dividends on shares of Class A Common Stock in the Company’s Class A Common Stock.

Dividend

During the nine months ended September 30, 2024, the Company made cash dividend payments of $272.9 million to holders of Class A Common Stock and Common Units and $75.2 million was reinvested in shares of Class A Common Stock by the Reinvestment Holders.

On October 17, 2024, the Board declared a cash dividend of $0.78 per share on the Company’s Class A Common Stock which will be payable to stockholders on October 28, 2024. The Company, through its ownership of the general partner of the Partnership, declared a distribution of $0.78 per Common Unit from the Partnership to the holders of Common Units, which will be payable on November 7, 2024. As described in these Condensed Consolidated Financial Statements, as the context requires, dividends paid to holders of Class A Common Stock and distributions paid to holders of Common Units may be referred to collectively as “dividends.”

Share Repurchase Program

For nine months ended September 30, 2024, the Company did not repurchase any of its outstanding shares.

For more information regarding the 1% U.S. federal excise tax imposed on certain repurchases of stock by publicly traded U.S. corporations, please refer to Part I, Item 1A.—”Risk Factors— Risks Related to Ownership of our Common Stock” of the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, filed on March 5, 2024.

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Liquidity

The following table presents a summary of the Company’s key liquidity indicators at the dates presented:

	September 30,		December 31,
	2024		2023
	(In thousands)
Cash and cash equivalents	$	20,438	$	4,510
Total debt, net of unamortized deferred financing cost	$	3,429,689	$	3,562,809
Available committed borrowing capacity	$	730,400	$	643,400

Total debt and available credit facilities

There is no assurance that the financial condition of banks with lending commitments to the Company and its subsidiaries will not deteriorate. The Company closely monitors the ratings of the banks in the Company’s bank group. Having a large bank group allows the Company to mitigate the potential impact of any bank’s failure to honor its lending commitment.

Off-Balance Sheet Arrangements

As of September 30, 2024, there were no off-balance sheet arrangements.

Critical Accounting Policies and Estimates

There have been no significant changes to our critical accounting policies and estimates from those disclosed on our Annual Report on Form 10-K for the year ended December 31, 2023. Please refer to information regarding our critical accounting policies and estimates included in Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2023 filed with the Commission on March 5, 2024.

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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Quantitative and Qualitative Disclosure About Market Risk

The Company is exposed to various market risks, including the effects of adverse changes in commodity prices and credit risk as described below. The Company continually monitors its market risk exposure, including the impact and developments related to the conflicts in Ukraine and Israel, monetary policy addressing the interest rate and inflation trend, which continued to have significant impact on volatility and uncertainties in the financial markets during the third quarter of 2024.

Commodity Price Risk

The results of the Company’s operations may be affected by the market prices of oil and natural gas. A portion of the Company’s revenue is directly tied to local crude, natural gas, NGLs and condensate prices in the Permian Basin. Fluctuations in commodity prices also impact operating cost elements both directly and indirectly. For example, commodity prices directly impact costs such as power and fuel, which are expenses that increase or decrease in line with changes in commodity prices. Commodity prices also affect industry activity and demand, thus indirectly impacting the cost of items such as labor and equipment rentals. Management regularly reviews the Company’s potential exposure to commodity price risk and uses financial or physical arrangements to mitigate potential volatility. Refer to Note 11—Derivatives and Hedging Activities in the Notes to Condensed Consolidated Financial Statements in this Quarterly Report on Form 10-Q for additional discussion regarding our hedging strategies and objectives.

Interest Rate Risk

As of September 30, 2024, the Company had interest bearing debt, net of deferred financing costs, with principal amount of $3.43 billion. The interest rates for the Revolving Credit Facility, the Term Loan and A/R Facility are variable, which expose the Company to the risk of increased interest expense in the event of increases to interest rates. Accordingly, results of operations, cash flows, financial condition and the ability to make cash distributions could be adversely affected by significant increases in interest rates. As of September 30, 2024, the Company had two interest rate swap contracts with total notional amounts of $1.70 billion maturing on May 31, 2025 that pay a fixed rate ranging from 4.38% to 4.48% and one interest rate swap contract with notional amount of $0.08 billion maturing on December 31, 2025 that pays a fixed rate of 3.02%. Refer to Note 11—Derivatives and Hedging Activities in the Notes to Condensed Consolidated Financial Statements in this Quarterly Report on Form 10-Q for additional discussion regarding our hedging strategies and objectives. In addition, the Company realizes 0.05% reductions to the effective interest rates of both the Revolving Credit Facility and the Term Loan during 2024 in relation to sustainability adjustment features embedded in these facilities as the Company has met its sustainability performance targets for fiscal year 2022 and 2023.

Credit Risk

The Company is subject to credit risk resulting from nonpayment or nonperformance by, or the insolvency or liquidation of, third-party customers. Any increase in nonpayment and nonperformance by, or the insolvency or liquidation of, the Company’s customers could adversely affect the Company’s results of operations.

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ITEM 4. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

As of September 30, 2024, pursuant to Rule 13a-15(b) of the Exchange Act, the Company conducted an evaluation, under the supervision and with the participation of the Company’s management, including the Chief Executive Officer and Chief Accounting and Administrative Officer, who serves as the principal accounting officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) of the Exchange Act). Based upon that evaluation, the Company’s Chief Executive Officer and Chief Accounting and Administrative Officer concluded that the design and operation of the Company’s disclosure controls and procedures were effective as of September 30, 2024.

The Company’s disclosure controls and procedures are designed to provide reasonable assurance that information required to be disclosed in the reports that the Company files or submits under the Exchange Act is recorded, processed, summarized and reported within the time period specified in the applicable rules and forms of the SEC. The Company’s disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by the Company in the reports that the Company files or submits under the Exchange Act is accumulated and communicated to the Company’s management, including the Chief Executive Officer and Chief Accounting and Administrative Officer, as appropriate, to allow timely decisions regarding required disclosure.

As disclosed in Note—2 Business Combinations in the Notes to Condensed Consolidated Financial Statements, we acquired Durango on June 24, 2024, and its total revenues constituted approximately 4% of total revenues as shown on our Condensed Consolidated Statements of Operations for the nine months ended September 30, 2024. Durango’s total assets constituted approximately 13% of total assets as shown on our Condensed Consolidated Balance Sheet as of September 30, 2024. We expect to exclude Durango’s internal control over financial reporting from the scope of management's assessment of the effectiveness of our disclosure controls and procedures for one year following the acquisition. As part of the Company’s ongoing integration activities, the Company’s financial reporting controls and procedures are in the process of incorporating the financial information of Durango. The Condensed Consolidated Financial Statements presented in this Quarterly Report on Form 10-Q were prepared using certain information obtained from Durango’s separate, legacy systems.

Change in Internal Control over Financial Reporting

Except as described above, there were no changes in the Company’s internal control over financial reporting (as defined in Rule 13a-15(f) and 15d-15(f) of the Exchange Act) during the quarter ended September 30, 2024, that have materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

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PART II — OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

For further information regarding legal proceedings, refer to Note 15—Commitments and Contingencies in the Notes to Condensed Consolidated Financial Statements in this Quarterly Report on Form 10-Q.

ITEM 1A. RISK FACTORS

Please refer to Part II, Item 1A — “Risk Factors” in the Company’s Annual Report Form 10-K for the year ended December 31, 2023 filed on March 5, 2024.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

There was no unregistered sale of equity securities or repurchase activities during the three months ended September 30, 2024.

ITEM 5. OTHER INFORMATION

Trading Arrangements

During the three months ended September 30, 2024, none of our directors or officers (as defined in Rule 16a-1(f) of the Securities Exchange Act of 1934) adopted, terminated or modified a “Rule 10b5-1 trading arrangement” or non-Rule 10b5-1 trading arrangement (as each term is defined in Item 408 of Regulation S-K).

Disclosure Pursuant to Section 13(r) of the Securities Exchange Act of 1934

Pursuant to Section 13(r) of the Exchange Act, we may be required to disclose in our annual and quarterly reports to the SEC whether we or any of our “affiliates” knowingly engaged in certain activities, transactions or dealings relating to Iran or with certain individuals or entities targeted by US economic sanctions. Disclosure is generally required even where the activities, transactions or dealings were conducted in compliance with applicable law. Because the SEC defines the term “affiliate” broadly, it includes any entity under common “control” with us (and the term “control” is also construed broadly by the SEC).

The description of the activities below has been provided to us by Blackstone Inc. (“BX”), affiliates of which: (i) beneficially own more than 10% of our outstanding common stock and are members of our board of directors, and (ii) hold a minority non-controlling interest in Mundys S.p.A (formerly Atlantia S.p.A). Mundys S.p.A. may therefore be deemed to be under common “control” with us; however, this statement is not meant to be an admission that common control exists.

The disclosure below relates solely to activities conducted by Mundys S.p.A. The disclosure does not relate to any activities conducted by us or by BX and does not involve our or BX’s management. Neither we nor BX has had any involvement in or control over the disclosed activities, and neither we nor BX has independently verified or participated in the preparation of the disclosure. Neither we nor BX is representing as to the accuracy or completeness of the disclosure nor do we or BX undertake any obligation to correct or update it.

We understand that BX disclosed the following in their most recent Quarterly report on Form 10-Q, and as of September 30, 2024, the Company is unaware of any changes to the relationship status between BX and Mundys S.p.A, therefore, the Company included BX’s disclosure of certain activities, transactions or dealings between BX and Iran.

Disclosure pursuant to Section 13(r) of the Securities Exchange Act of 1934. Funds affiliated with Blackstone first invested in Mundys S.p.A. on November 18, 2022 in connection with the voluntary public tender offer by Schema Alfa S.p.A. for all of the shares of Mundys S.p.A., pursuant to which such funds obtained a minority non-controlling interest in Mundys S.p.A. Mundys S.p.A. owns and controls Aeroporti di Roma S.p.A. (“ADR”), an operator of airports in Italy including Leonardo da Vinci-Fiumicino Airport. Iran Air has historically operated periodic flights to and from Leonardo da Vinci-Fiumicino Airport as authorized, from time to time, by an aviation-related bilateral agreement between Italy and Iran, scheduled in compliance with European Regulation 95/93, and approved by the Italian Civil Aviation Authority. ADR, as airport operator, is under a mandatory obligation to provide airport services to all air carriers (including Iran Air) authorized by the applicable Italian authority. The relevant turnover attributable to these activities (whose consideration is calculated on the basis of general tariffs determined by such independent Italian authority) in the quarter ended September 30, 2024 was less than €100,000. Mundys S.p.A. does not track profits specifically attributable to these activities.

44

ITEM 6. EXHIBITS

EXHIBIT NO.		DESCRIPTION
2.1***	–	Contribution Agreement, dated October 21, 2021, by and among Altus Midstream Company, Altus Midstream LP, New BCP Raptor Holdco, LLC, and BCP Raptor Holdco, LP.
3.1	–	Third Amended and Restated Certificate of Incorporation of Kinetik Holdings Inc.
3.2	–	Amended and Restated Bylaws of Kinetik Holdings Inc.
3.3	–	Certificate of Amendment to the Third Amended and Restated Certificate of Incorporation of Kinetik Holdings Inc. (incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed on June 2, 2023).
4.1	–	Amended and Restated Stockholders Agreement, dated October 21, 2021, by and among APA Corporation, Apache Midstream LLC, Altus Midstream Company, New BCP Raptor Holdco, LLC, Raptor Aggregator, LP, BX Permian Pipeline Aggregator, LP, Buzzard Midstream LLC, and BCP Raptor Holdco, LP.
4.2	–	Second Amended and Restated Registration Rights Agreement, dated February 22, 2022, by and among Altus Midstream Company, Apache Midstream LLC, Raptor Aggregator, LP, BX Permian Pipeline Aggregator, LP, Buzzard Midstream LLC and the other holders party thereto.
4.3	–	Indenture, dated June 8, 2022, by and among Kinetik Holdings Inc., as parent, Kinetik Holdings LP, as issuer, and U.S. Bank Trust Company, National Association, as trustee (incorporated by reference to Exhibit 4.1 to the Registrant’s Current Report on Form 8-K filed on June 14, 2022).
4.4	–	Form of 5.875% Senior Notes Due 2030 (included in Exhibit 4.3) (incorporated by reference to Exhibit 4.2 to the Registrant’s Current Report on Form 8-K filed on June 14, 2022).
4.5	–	Indenture, dated December 6, 2023, by and among Kinetik Holdings Inc., Kinetik Holdings LP and U.S. Bank Trust Company, National Association, as trustee (incorporated by reference to Exhibit 4.1 to the Registrant’s Current Report on Form 8-K filed on December 6, 2023).
4.6	–	Form of 6.625% Sustainability-Linked Senior Notes (incorporated by reference to Exhibit 4.2 to the Registrant’s Current Report on Form 8-K filed on December 6, 2023).
4.7	–	Registration Rights Agreement, dated as of June 24, 2024, by and among Kinetik Holdings Inc. and Durango Midstream LLC (incorporated by reference to Exhibit 4.1 to the Registrant’s Current Report on Form 8-K filed June 28, 2024).
10.1		Third Amended and Restated Agreement of Limited Partnership of Altus Midstream LP, dated as of October 22, 2021.
10.2†		Kinetik Holdings Inc. Amended and Restated 2019 Omnibus Compensation Plan (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed on May 23, 2024).
10.3***	–	Receivables Purchase Agreement, dated April 2, 2024, by and among Kinetik Receivables LLC, as the seller, Kinetik Holdings LP, a subsidiary of Kinetik Holdings Inc., as the servicer, PNC Bank, National Association, as administrative agent, PNC Capital Markets LLC, as structuring agent, and the purchasers party thereto.
10.4***	–	Sale and Contribution Agreement, dated April 2, 2024, by and among Kinetik Holdings LP, a subsidiary of Kinetik Holdings Inc., Kinetik Receivables LLC and the originators party thereto.
10.5***	–	Purchase and Sale Agreement, dated as of May 9, 2024, by and among Kinetik GCX Pipe LLC, GCX Pipeline, LLC, solely for purposes of Section 6.7, Article X and Article XI, AL GCX Holdings, LLC and solely for purposes of Section 6.8, Article X and Article XI, Kinetik Holdings LP (incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed on May 13, 2024).
10.6***	–	Membership Interest Purchase Agreement, dated as of May 9, 2024, by and among Kinetik Holdings Inc., Kinetik Holdings LP and Durango Midstream, LLC (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the Commission on May 13, 2024).
10.7	–	Observer Rights Agreement, dated as of June 24, 2024, by and among Kinetik Holdings Inc., Kinetik Holdings LP and Durango Midstream LLC (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the Commission on June 28, 2024).
31.1*	–	Certification of the Principal Executive Officer required by Rule 13a-14(a) or Rule 15d-14(a).
31.2*	–	Certification of the Principal Financial Officer required by Rule 13a-14(a) or Rule 15d-14(a).
32.1**	–	Certification of the Principal Executive Officer required by Rule 13a-14(a) or Rule 15d-14(b) and 18 U.S.C. 1350.
32.2**	–	Certification of the Principal Financial Officer required by Rule 13a-14(a) or Rule 15d-14(b) and 18 U.S.C. 1350.
101*	–	The following financial statements from the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2024, formatted in Inline XBRL: (i) Condensed Consolidated Statements of Operations, (ii) Condensed Consolidated Balance Sheets, (iii) Condensed Consolidated Statements of Cash Flows, (iv) Condensed Consolidated Statements of Changes in Equity and Noncontrolling Interests and (v) Notes to Condensed Consolidated Financial Statements, tagged as blocks of text and including detailed tags.

45

EXHIBIT NO.		DESCRIPTION
101.SCH*	–	Inline XBRL Taxonomy Schema Document.
101.CAL*	–	Inline XBRL Calculation Linkbase Document.
101.DEF*	–	Inline XBRL Definition Linkbase Document.
101.LAB*	–	Inline XBRL Label Linkbase Document.
101.PRE*	–	Inline XBRL Presentation Linkbase Document.
104*	–	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

* Filed herewith.

** Furnished herewith.

*** Schedules and exhibits to this Exhibit have been omitted pursuant to Regulation S-K Item 601(b)(2). The Company agrees to furnish supplementally a copy of any omitted schedule or exhibit to the SEC upon request.

† Management contracts or compensatory plans or arrangements.

46

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

		KINETIK HOLDINGS INC.
Dated:	November 7, 2024	/s/ Jamie Welch
		Jamie Welch
		Chief Executive Officer, President and Director
		(Principal Executive Officer)
Dated:	November 7, 2024	/s/ Steven Stellato
		Steven Stellato
		Executive Vice President, Chief Accounting and Chief Administrative Officer
		(Principal Financial Officer and Principal Accounting Officer)

47

EX-31.1

EXHIBIT 31.1

CERTIFICATIONS

I, Jamie Welch, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Kinetik Holdings Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.     The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 7, 2024

/s/ Jamie Welch

Jamie Welch

Chief Executive Officer, President and Director

EX-31.2

EXHIBIT 31.2

CERTIFICATIONS

I, Steven Stellato, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Kinetik Holdings Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.     The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 7, 2024

/s/ Steven Stellato

Steven Stellato

Executive Vice President, Chief Accounting and Chief Administrative Officer

EX-32.1

EXHIBIT 32.1

KINETIK HOLDINGS INC.

Certification of Principal Executive Officer

I, Jamie Welch, Chief Executive Officer, President and Director, certify pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge, the Quarterly Report on Form 10-Q of Kinetik Holdings Inc. for the quarterly period ending September 30, 2024 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. §78m or §78o (d)) and that information contained in such report fairly presents, in all material respects, the financial condition and results of operations of Kinetik Holdings Inc.

Date: November 7, 2024

/s/ Jamie Welch

Jamie Welch

Chief Executive Officer, President and Director

EX-32.2

EXHIBIT 32.2

KINETIK HOLDINGS INC.

Certification of Principal Financial Officer

I, Steven Stellato, Executive Vice President, Chief Accounting and Chief Administrative Officer, certify pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge, the Quarterly Report on Form 10-Q of Kinetik Holdings Inc. for the quarterly period ending September 30, 2024 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. §78m or §78o (d)) and that information contained in such report fairly presents, in all material respects, the financial condition and results of operations of Kinetik Holdings Inc.

Date: November 7, 2024

/s/ Steven Stellato

Steven Stellato

Executive Vice President, Chief Accounting and Chief Administrative Officer

XML

Cover - shares	9 Months Ended
	Sep. 30, 2024	Oct. 31, 2024
Document Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2024
Document Transition Report	false
Entity File Number	001-38048
Entity Registrant Name	KINETIK HOLDINGS INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	81-4675947
Entity Address, Address Line One	2700 Post Oak Blvd
Entity Address, Address Line Two	Suite 300
Entity Address, City or Town	Houston
Entity Address, State or Province	TX
Entity Address, Postal Zip Code	77056
City Area Code	713
Local Phone Number	621-7330
Title of 12(b) Security	Class A common stock, $0.0001 par value
Trading Symbol	KNTK
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Amendment Flag	false
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	Q3
Entity Central Index Key	0001692787
Current Fiscal Year End Date	--12-31
Class A Common Stock
Document Information [Line Items]
Entity Common Stock, Shares Outstanding		59,754,273
Class C Common Stock
Document Information [Line Items]
Entity Common Stock, Shares Outstanding		97,783,034

XML

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands		3 Months Ended		9 Months Ended
		Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Operating revenues:
Total revenues	[1]	$ 396,362	$ 330,301	$ 1,097,213	$ 907,544
Operating costs and expenses:
Costs of sales (exclusive of depreciation and amortization)	[2],[3]	144,586	147,756	444,786	374,100
Operating expenses		55,804	42,925	143,278	118,804
Ad valorem taxes		5,896	5,607	18,400	14,954
General and administrative expenses		29,619	22,751	94,846	73,131
Depreciation and amortization expenses		87,583	69,935	236,250	208,271
Loss on disposal of assets		0	2,927	4,090	15,166
Total operating costs and expenses		323,488	291,901	941,650	804,426
Operating income		72,874	38,400	155,563	103,118
Other income (expense):
Interest and other income		1,872	289	2,272	1,625
Loss on debt extinguishment		0	0	(525)	0
Gain on sale of equity method investment		29,953	0	89,837	0
Interest expense		(66,029)	(45,009)	(167,545)	(130,443)
Equity in earnings of unconsolidated affiliates		53,244	50,754	169,668	146,828
Total other income, net		19,040	6,034	93,707	18,010
Income before income taxes		91,914	44,434	249,270	121,128
Income tax expense		8,260	1,303	21,261	2,030
Net income including noncontrolling interest		83,654	43,131	228,009	119,098
Net income attributable to Common Unit limited partners		57,891	27,551	153,504	77,068
Net income attributable to Class A Common Stock Shareholders		$ 25,763	$ 15,580	$ 74,505	$ 42,030
Net income attributable to Class A Common Shareholders, per share
Basic (in USD per share)		$ 0.35	$ 0.21	$ 1.03	$ 0.58
Diluted (in USD per share)		$ 0.35	$ 0.21	$ 1.02	$ 0.57
Weighted-average shares
Basic (in shares)		59,811	53,340	59,116	50,464
Diluted (in shares)		60,424	53,463	59,852	50,719
Service revenue
Operating revenues:
Total revenues		$ 103,100	$ 104,349	$ 301,710	$ 310,325
Product revenue
Operating revenues:
Total revenues		290,423	221,280	787,092	586,534
Other revenue
Operating revenues:
Total revenues		$ 2,839	$ 4,672	$ 8,411	$ 10,685

[1] Includes amounts associated with related parties of nil and $20.0 million for the three months ended September 30, 2024 and 2023, respectively, and $17.2 million and $70.9 million for the nine months ended September 30, 2024 and 2023, respectively.

[2] Cost of sales (exclusive of depreciation and amortization) is net of gas service revenues totaling $60.2 million and $38.6 million for the three months ended September 30, 2024 and 2023, respectively, and $159.4 million and $107.1 million for the nine months ended September 30, 2024 and 2023, respectively, for certain volumes where we act as principal.

[3] Includes amounts associated with related parties of $12.8 million and $15.5 million for the three months ended September 30, 2024 and 2023, respectively, and $48.7 million and $50.6 million for the nine months ended September 30, 2024 and 2023, respectively

XML

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) - USD ($)		3 Months Ended		9 Months Ended
		Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Revenue		$ 396,362,000	$ 330,301,000	$ 1,097,213,000	$ 907,544,000
Costs of sales (exclusive of depreciation and amortization)	[1],[2]	144,586,000	147,756,000	444,786,000	374,100,000
Gas Service Revenues
Costs of sales (exclusive of depreciation and amortization)		60,200,000	38,600,000	159,400,000	107,100,000
Related Party
Revenue		0	20,000,000.0	17,200,000	70,900,000
Costs of sales (exclusive of depreciation and amortization)		$ 12,800,000	$ 15,500,000	$ 48,700,000	$ 50,600,000

[1] Cost of sales (exclusive of depreciation and amortization) is net of gas service revenues totaling $60.2 million and $38.6 million for the three months ended September 30, 2024 and 2023, respectively, and $159.4 million and $107.1 million for the nine months ended September 30, 2024 and 2023, respectively, for certain volumes where we act as principal.

[2] Includes amounts associated with related parties of $12.8 million and $15.5 million for the three months ended September 30, 2024 and 2023, respectively, and $48.7 million and $50.6 million for the nine months ended September 30, 2024 and 2023, respectively

XML

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands		Sep. 30, 2024	Dec. 31, 2023
CURRENT ASSETS:
Cash and cash equivalents		$ 20,438	$ 4,510
Accounts receivable, net of allowance for credit losses of $1,000 in 2024 and 2023	[1]	65,615	215,721
Accounts receivable pledged		150,000	0
Derivative assets		6,276	7,812
Prepaid and other current assets		43,549	29,256
Current assets		285,878	257,299
NONCURRENT ASSETS:
Property, plant and equipment, net		3,226,884	2,743,227
Intangible assets, net		878,141	591,670
Derivative asset, non-current		1,593	165
Deferred tax assets		203,671	235,627
Operating lease right-of-use assets		38,101	37,569
Deferred charges and other assets		79,169	85,250
Investments in unconsolidated affiliates		2,141,947	2,540,989
Goodwill		5,077	5,077
Noncurrent assets		6,574,583	6,239,574
Total assets		6,860,461	6,496,873
CURRENT LIABILITIES:
Accounts payable		17,160	34,000
Accrued expenses		191,789	177,421
Derivative liabilities		6,743	1,734
Current portion of operating lease liabilities		25,483	29,203
Current debt obligations		150,000	0
Other current liabilities		7,505	7,786
Current liabilities		398,680	250,144
NONCURRENT LIABILITIES
Long term debt, net		3,279,689	3,562,809
Contract liabilities		21,858	25,761
Operating lease liabilities		13,147	9,349
Derivative liabilities		1,081	5,363
Other liabilities		67,517	3,219
Deferred tax liabilities		16,014	13,244
Noncurrent liabilities		3,399,306	3,619,745
Total liabilities		3,797,986	3,869,889
COMMITMENTS AND CONTINGENCIES (Note 15)
Redeemable noncontrolling interest — Common Unit limited partners		4,783,180	3,157,807
EQUITY:
Deferred consideration		1	0
Additional paid-in capital		0	192,678
Accumulated deficit		(1,720,721)	(723,516)
Total equity		(1,720,705)	(530,823)
Total liabilities, noncontrolling interest, and equity		6,860,461	6,496,873
Class A Common Stock
EQUITY:
Common stock		6	6
Class C Common Stock
EQUITY:
Common stock		$ 9	$ 9

[1] Includes amounts of $15.8 million associated with related parties as of December 31, 2023. No related party balance as of September 30, 2024. See Note 1—Description of the Organization and Summary of Significant Accounting Polices in the Notes to Condensed Consolidated Financial Statements for additional information.

XML

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Accounts receivable, allowance for credit losses	$ 1,000	$ 1,000
Related Party
Outstanding receivable	$ 0	$ 15,800
Class A Common Stock
Common stock, par value (in USD per share)	$ 0.0001	$ 0.0001
Common stock, shares authorized (in shares)	1,500,000,000	1,500,000,000
Common stock, shares issued (in shares)	59,751,435	57,096,538
Common stock, shares outstanding (in shares)	59,751,435	57,096,538
Class C Common Stock
Common stock, par value (in USD per share)	$ 0.0001	$ 0.0001
Common stock, shares authorized (in shares)	1,500,000,000	1,500,000,000
Common stock, shares issued (in shares)	97,783,034	94,089,038
Common stock, shares outstanding (in shares)	97,783,034	94,089,038

XML

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands		9 Months Ended
		Sep. 30, 2024	Sep. 30, 2023
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income including noncontrolling interest		$ 228,009	$ 119,098
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization expense		236,250	208,271
Amortization of deferred financing costs		5,497	4,601
Amortization of contract costs		4,965	4,965
Contingent liabilities fair value adjustment		1,400	0
Distributions from unconsolidated affiliates		223,670	205,891
Derivatives settlement		(8,103)	15,111
Derivative fair value adjustment		8,938	(41,028)
Warrants fair value adjustment		0	(73)
Gain on sale of equity method investment		(89,837)	0
Loss on disposal of assets		4,090	15,166
Equity in earnings of unconsolidated affiliates		(169,668)	(146,828)
Loss on debt extinguishment		525	0
Share-based compensation		52,868	43,340
Deferred income taxes		19,733	1,675
Changes in operating assets and liabilities:
Accounts receivable and pledged receivable		29,492	(26,982)
Other assets		(3,729)	(7,033)
Accounts payable		(53,361)	(780)
Accrued liabilities		4,815	8,840
Other non-current liabilities		(1,744)	668
Operating leases		(454)	683
Net cash provided by operating activities		493,356	405,585
CASH FLOWS FROM INVESTING ACTIVITIES:
Property, plant and equipment expenditures		(155,805)	(245,798)
Intangible assets expenditures		(7,744)	(15,079)
Investments in unconsolidated affiliates		(3,273)	(202,729)
Net cash paid for acquisition of interest in unconsolidated affiliate		(85,417)	0
Distributions from unconsolidated affiliate		2,789	5,793
Cash proceeds from sale of equity method investment		524,390	0
Cash proceeds from disposals of assets		334	213
Net cash paid for acquisition		(341,183)	(125,000)
Net cash used in investing activities		(65,909)	(582,600)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from borrowings under A/R Facility		151,200	0
Payments on A/R Facility		(1,200)	0
Payments on Term Loan Credit Facility		(200,000)	0
Payments of debt issuance costs		(1,086)	0
Payment of debt discount		(500)	0
Proceeds from revolver		826,000	673,000
Payments of revolver		(913,000)	(438,000)
Cash dividends paid to Class A Common Stock shareholders		(128,428)	(58,030)
Distributions paid to Class C Common Unit limited partners		(144,505)	(524)
Repurchase of Class A Common Stock		0	(5,757)
Net cash (used in) provided by financing activities		(411,519)	170,689
Net change in cash		15,928	(6,326)
CASH, BEGINNING OF PERIOD		4,510	6,394
CASH, END OF PERIOD		20,438	68
SUPPLEMENTAL SCHEDULE OF INVESTING AND FINANCING ACTIVITIES
Cash paid for interest, net of amounts capitalized		166,769	165,877
Cash paid for income taxes, net		559	484
Property and equipment and intangible accruals in accounts payable and accrued liabilities		24,140	25,237
Right-of-use assets obtained in exchange for lease liabilities		42,974	5,189
Class A Common Stock issued through dividend and distribution reinvestment plan		75,243	263,771
Restructuring Cost and Reserve [Line Items]
Class C Common Units issued in exchange		1
Durango Permian LLC Acquisition
Restructuring Cost and Reserve [Line Items]
Fair value of Durango assets acquired	[1]	910,221	0
Cash consideration paid		357,968	0
Deferred consideration		275,000	0
Contingent consideration		64,000	0
Durango liabilities assumed		65,053	0
Durango Permian LLC Acquisition | Class C Common Stock
Restructuring Cost and Reserve [Line Items]
Class C Common Units issued in exchange		$ 148,200	$ 0

[1] See Note 2—Business Combinations in the Notes to Condensed Consolidated Financial Statements for additional information regarding the Durango Acquisition (as defined herein).

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CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY AND NONCONTROLLING INTERESTS - USD ($) $ in Thousands	Total	Redeemable Common Stock	Class A Common Stock	Class C Common Stock	Common Stock Class A Common Stock	Common Stock Class C Common Stock	Deferred Consideration Class C Common Stock		Additional Paid-in Capital	Accumulated Deficit	Treasury Stock
Beginning balance at Dec. 31, 2022		$ 3,112,409
Increase (Decrease) in Temporary Equity [Roll Forward]
Redemption of Common Units		(5,634)
Net income		77,068
Change in redemption value of noncontrolling interests		236,358
Distribution paid to Common Unit limited partners		(211,700)
Ending balance at Sep. 30, 2023		3,208,501
Beginning balance (in shares) at Dec. 31, 2022					45,679,000	94,270,000	0	[1]
Beginning balance at Dec. 31, 2022	$ (839,775)				$ 5	$ 9	$ 0		$ 118,840	$ (958,629)	$ 0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Redemption of Common Units (in shares)					181,000	(181,000)
Redemption of Common Units	5,634								5,634
Issuance of common stock through dividend and distribution reinvestment plan (in shares)					8,641,000
Issuance of common stock through dividend and distribution reinvestment plan	263,772				$ 1				263,771
Retirement of treasury stock	0									(5,757)	5,757
Repurchase of Class A Common Stock (in shares)					(194,000)
Repurchase of Class A Common Stock	(5,757)										(5,757)
Share-based compensation (in shares)					213,000
Share-based compensation	43,340								43,340
Net income	42,030									42,030
Change in redemption value of noncontrolling interests	(236,358)								(339,838)	103,480
Dividends on Class A Common Stock	(110,902)									(110,902)
Ending balance (in shares) at Sep. 30, 2023					54,520,000	94,089,000	0	[1]
Ending balance at Sep. 30, 2023	(838,016)				$ 6	$ 9	$ 0		91,747	(929,778)	0
Beginning balance at Jun. 30, 2023		3,242,619
Increase (Decrease) in Temporary Equity [Roll Forward]
Net income		27,551
Change in redemption value of noncontrolling interests		8,899
Distribution paid to Common Unit limited partners		(70,568)
Ending balance at Sep. 30, 2023		3,208,501
Beginning balance (in shares) at Jun. 30, 2023					51,973,000	94,089,000	0	[1]
Beginning balance at Jun. 30, 2023	(905,757)				$ 5	$ 9	$ 0		0	(902,446)	(3,325)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of common stock through dividend and distribution reinvestment plan (in shares)					2,546,000
Issuance of common stock through dividend and distribution reinvestment plan	88,145				$ 1				88,144
Retirement of treasury stock	0									(3,325)	3,325
Share-based compensation (in shares)					1,000
Share-based compensation	12,502								12,502
Net income	15,580									15,580
Change in redemption value of noncontrolling interests	(8,899)								(8,899)
Dividends on Class A Common Stock	(39,587)									(39,587)
Ending balance (in shares) at Sep. 30, 2023					54,520,000	94,089,000	0	[1]
Ending balance at Sep. 30, 2023	(838,016)				$ 6	$ 9	$ 0		91,747	(929,778)	0
Beginning balance at Dec. 31, 2023		3,157,807
Increase (Decrease) in Temporary Equity [Roll Forward]
Durango Acquisition		423,200
Redemption of Common Units		(5,060)
Net income		153,504
Change in redemption value of noncontrolling interests		1,268,038
Distribution paid to Common Unit limited partners		(214,309)
Ending balance at Sep. 30, 2024		4,783,180
Beginning balance (in shares) at Dec. 31, 2023			57,096,538	94,089,038	57,097,000	94,089,000	0	[1]
Beginning balance at Dec. 31, 2023	(530,823)				$ 6	$ 9	$ 0		192,678	(723,516)	0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Durango Acquisition (in shares)						3,840,000	7,680,000	[1]
Durango Acquisition	1						$ 1
Redemption of Common Units (in shares)					146,250	(146,250)
Redemption of Common Units	5,060								5,060
Issuance of common stock through dividend and distribution reinvestment plan (in shares)					2,205,000
Issuance of common stock through dividend and distribution reinvestment plan	75,243								75,243
Share-based compensation (in shares)					303,000
Share-based compensation	52,868								52,868
Net income	74,505									74,505
Change in redemption value of noncontrolling interests	(1,268,038)								(330,196)	(937,842)
Recognition of deferred tax asset	4,347								4,347
Dividends on Class A Common Stock	(133,868)									(133,868)
Ending balance (in shares) at Sep. 30, 2024			59,751,435	97,783,034	59,751,000	97,783,000	7,680,000	[1]
Ending balance at Sep. 30, 2024	(1,720,705)				$ 6	$ 9	$ 1		0	(1,720,721)	0
Beginning balance at Jun. 30, 2024		4,289,591
Increase (Decrease) in Temporary Equity [Roll Forward]
Net income		57,891
Change in redemption value of noncontrolling interests		509,035
Distribution paid to Common Unit limited partners		(73,337)
Ending balance at Sep. 30, 2024		$ 4,783,180
Beginning balance (in shares) at Jun. 30, 2024					59,736,000	97,783,000	7,680,000	[1]
Beginning balance at Jun. 30, 2024	(1,206,893)				$ 6	$ 9	$ 1		0	(1,206,909)	0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of common stock through dividend and distribution reinvestment plan (in shares)					11,000
Issuance of common stock through dividend and distribution reinvestment plan	444								444
Share-based compensation (in shares)					4,000
Share-based compensation	15,171								15,171
Net income	25,763									25,763
Change in redemption value of noncontrolling interests	(509,035)								(14,801)	(494,234)
Recognition of deferred tax asset	(814)								(814)
Dividends on Class A Common Stock	(45,341)									(45,341)
Ending balance (in shares) at Sep. 30, 2024			59,751,435	97,783,034	59,751,000	97,783,000	7,680,000	[1]
Ending balance at Sep. 30, 2024	$ (1,720,705)				$ 6	$ 9	$ 1		$ 0	$ (1,720,721)	$ 0

[1] Pursuant to the Durango MIPA (as defined herein), deferred consideration of 7.7 million shares of Class C Common Stock is to be issued on July 1, 2025. Fair value of the deferred consideration was included in the “Redeemable noncontrolling interest—Common Units limited partners” of the Condensed Consolidated Balance Sheets as of September 30, 2024.

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CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY AND NONCONTROLLING INTERESTS (Parenthetical) - $ / shares shares in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Class A Common Stock
Cash dividends (in USD per share)	$ 0.75	$ 0.75	$ 2.25	$ 2.25

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DESCRIPTION OF THE ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

9 Months Ended

Sep. 30, 2024

Accounting Policies [Abstract]

DESCRIPTION OF THE ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

DESCRIPTION OF THE ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization

The Company is a holding company, whose only significant assets are ownership of the non-economic general partner interest and an approximate 38% limited partner interest in Kinetik Holdings LP, a Delaware limited partnership (the “Partnership”). As the owner of the non-economic general partner interest in the Partnership, the Company is responsible for all operational, management and administrative decisions related to, and consolidates the results of, the Partnership and its subsidiaries.

The Company provides comprehensive gathering, produced water disposal, transportation, compression, processing and treating services necessary to bring natural gas, NGLs and crude oil to market. Additionally, the Company owns equity interests in three separate Permian Basin pipeline entities that have access to various markets along the U.S. Gulf Coast.

Basis of Presentation

The accompanying Condensed Consolidated Financial Statements have been prepared in accordance with GAAP. Certain reclassifications of prior year balances have been made to conform such amounts to the current year’s presentation. These reclassifications have no impact on net income. All adjustments that, in the opinion of management, are necessary for a fair presentation of the results of operations for the interim periods have been made and are of a recurring nature unless otherwise disclosed herein. The results of operations for such interim periods are not necessarily indicative of results of operations for a full year; accordingly, you should read these Condensed Consolidated Financial Statements in conjunction with our consolidated financial statements and related notes included in our 2023 Annual Report on Form 10-K. All intercompany balances and transactions have been eliminated in consolidation.

Significant Accounting Policies

The accounting policies that we follow are set forth in Note 2 – Summary of Significant Accounting Policies of the Notes to consolidated financial statements in our Annual Report on Form 10-K. There were no significant updates or revisions to our accounting policies during the nine months ended September 30, 2024, except as discussed herein.

Accounts Receivable Securitization Facility

Pursuant to ASC 860, Transfers and Servicing, accounts receivable that are sold or contributed by the Partnership to the special purpose vehicle are treated as collateral for borrowings under the third party A/R Facility (as defined below) and are included as “Accounts receivable pledged” within the Condensed Consolidated Balance Sheet. Proceeds from the transfer of the eligible accounts receivable under the third party A/R Facility are secured borrowings included as “Current debt obligations” within our Condensed Consolidated Balance Sheets. Proceeds and repayments under such facility are reflected as cash flows from financing activities in our Consolidated Statements of Cash Flows. See Note 7—Debt and Financing Costs in the Notes to our Condensed Consolidated Financial Statements set forth in this Form 10-Q for further discussion.

Transactions with related parties

The Company has revenue contracts and incurs cost of sales and operating expenses with Apache Midstream LLC (“Apache”), which owned more than 5% of the Company’s common stock prior to its secondary offerings completed in December 2023 and March 2024. Pursuant to ASC 850, Related Party Transactions, Apache was no longer a related party after the completion of its secondary offering in December 2023 as it owned less than 10% of the Company’s common stock. Pursuant to Regulation S-K, Item 404(a), Apache ceased to be a related party as of March 18, 2024 as it no longer owned any of the Company’s common stock. In 2024, for the period ended March 18, 2024, revenue from Apache was $17.2 million, cost of sales was $9.4 million and operating expenses were $0.2 million. In 2023, revenue from Apache was $20.0 million and $70.9 million, cost of sales was $13.1 million and $44.2 million, and operating expenses were $0.1 million and $0.5 million for the three and nine months ended September 30, 2023, respectively.

In addition, the Company incurs cost of sales with two of its equity method investment (“EMI”) pipeline entities, Permian Highway Pipeline LLC (“PHP”) and Breviloba, LLC (“Breviloba”). The Company pays a demand fee to PHP and pays a capacity fee to Breviloba for certain volumes moving on the Shin Oak NGL Pipeline. For the three and nine months ended September 30, 2024, the Company recorded cost of sales of $12.8 million and $39.3 million, respectively, with these affiliates. For the three and nine months ended September 30, 2023, the Company recorded cost of sales of $2.4 million and $6.4 million, respectively, with these affiliates.

Recently issued accounting pronouncements not yet adopted

Improvements to Reportable Segment Disclosures

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. The amendments in this update require, among other items, that public entities disclose, on an annual and interim basis, significant segment expenses that are regularly provided to the CODM and included within each reported measure of segment profit or loss. Additionally, the amendments require annual disclosure of the title and position of the CODM and how that individual uses the reported measure(s) of segment profit or loss in assessing segment performance and how to allocate resources.

These amendments are effective for fiscal years beginning after December 15, 2023, and for interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. The disclosures required in the amendments apply retrospectively to all prior periods presented in the financial statements. We are evaluating the effect of the amendments on our consolidated financial statements and expect to disclose the required information for fiscal years beginning in the Annual Report on Form 10-K for the year ended December 31, 2024 and for interim periods beginning in the Quarterly Report on Form 10-Q for the quarter ended March 31, 2025. The impact of the adoption will be limited to additional disclosure in the notes to the consolidated financial statements.

Improvements to Income Tax Disclosures

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The amendments in this update require, among other items, that public entities disclose, on an annual and interim basis, (i) specific categories of income taxes in the rate reconciliation, and (ii) a disaggregation of income taxes paid by federal, state, and foreign taxes.

These amendments are effective for fiscal years beginning after December 15, 2024, with early adoption permitted. The amendments are required to be applied prospectively with retrospective application permitted. We are evaluating the effect of the amendments on our consolidated financial statements and expect to disclose the required information beginning in the Annual Report on Form 10-K for the year ended December 31, 2025.

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BUSINESS COMBINATIONS

9 Months Ended

Sep. 30, 2024

Business Combinations [Abstract]

BUSINESS COMBINATIONS

BUSINESS COMBINATIONS

For acquired businesses, we recognize the identifiable assets acquired and the liabilities assumed at their estimated fair values on the date of acquisition with any excess purchase price over the fair value of net assets acquired recorded to goodwill. Determining the fair value of these items requires management’s judgment and the utilization of an independent valuation specialist, if applicable, and involves the use of significant estimates and assumptions.

Durango Permian LLC Acquisition

On June 24, 2024 (the “Closing Date”), the Company consummated the previously announced transaction contemplated by the Membership Interest Purchase Agreement (the “Durango MIPA”), dated May 9, 2024, by and between the Company, the Partnership, and Durango Midstream LLC, an affiliate of Morgan Stanley Equity Partners (the “Durango Seller”), pursuant to which the Partnership purchased all of the membership interests of Durango Permian, LLC and its wholly owned subsidiaries (“Durango”) from Durango Seller for an adjusted purchase price of approximately $845.2 million (the “Durango Acquisition”), consisting of (i) $358.0 million of cash consideration paid at closing, (ii) approximately 3.8 million shares of Class C Common Stock, par value $0.0001 per share of the Company (“Class C Common Stock”) (and an equivalent number of common units in the Partnership (“OpCo Units”)), valued at $148.2 million, issued at closing and (iii) approximately 7.7 million shares of Class C Common Stock (and an equivalent number of OpCo Units), valued at $275.0 million, to be issued on July 1, 2025. Durango Seller is also entitled to an earn out of up to $75.0 million in cash contingent upon the Kings Landing gas processing complex in Eddy County, New Mexico (the “Kings Landing Project”), which is currently under construction, being placed into service (the “Kings Landing Earnout”). The Kings Landing Earnout is subject to reduction based on actual capital costs associated with the Kings Landing Project. The Durango Acquisition allows the Company to further expand its footprint into New Mexico and across the Northern Delaware Basin.

The Durango Acquisition was accounted for as a business combination in accordance with ASC 805 Business Combination (“ASC 805”). Starting on the Closing Date, our Consolidated Financial Statements reflected Durango as a consolidated subsidiary. The accompanying Condensed Consolidated Financial Statements herein include (i) the combined net assets of the Company carried at historical costs and net assets of Durango carried at fair value as of the Closing Date and (ii) the combined results of operations of the Company with Durango’s results presented within the Condensed Consolidated Financial Statements from the Closing Date going forward.

The preliminary purchase price allocation was based on Durango’s latest financial statements available as of May 31, 2024, and included preliminary adjustments for working capital and fair value of underlying assets acquired and liabilities assumed. Both observable and non-observable market data, thus Level 2 and Level 3 inputs, are used in the assessment of the fair value of the assets acquired and liabilities assumed listed in the below table. The fair value of the processing plants, gathering system and related facilities and equipment is based on market and cost approaches and will be depreciated over an estimated useful life ranging from five to thirty years, which is consistent with the Company’s policy over similar facilities and equipment. The fair value of the intangible assets is based on the market approach for the right-of-way and discounted cash flow approach for customer contracts, which will be amortized over estimated useful lives ranging from seven to twelve years. The assumed liabilities are approximate to fair value at the Closing Date. Acquired net assets from this business combination were included in the Midstream Logistic segment. In addition, the Company recorded a contingent liability related to the Kings Landing Earnout based on project completion probability, see additional information in Note 15—Commitments and Contingencies in the Notes to our Condensed Consolidated Financial Statements set forth in this Form 10-Q.

Since the Closing Date, the Company has made necessary adjustments to the purchase price allocation as information about facts and circumstances that existed at the Closing Date have become available. This included certain working capital adjustments as a result of obtaining Durango’s closing balance sheet as of June 30, 2024. During the three months ended September 30, 2024, the Company identified working capital adjustments of $21.0 million resulting from the final closing balance sheet, and valuation adjustments related to the long-lived assets and intangible assets of $10.6 million, resulting in a decrease in goodwill of $10.4 million. The Company will continue to identify necessary adjustments to finalize the purchase price allocation during the 12-month period following the Closing Date as we obtain the remaining original cost data for our tangible asset valuation, as well as complete our evaluation of the potential liabilities assumed, including certain historical environmental exposures.

The following table summarizes the estimated fair value of assets acquired and liabilities assumed in the Durango Acquisition as of June 24, 2024, in accordance with ASC 805:

(In thousands)	Amount
Cash and cash equivalents	$	16,785
Accounts receivable	29,386
Prepaid and other current assets	10,000
Property, plant, and equipment, net	471,429
Intangible assets, net	379,000
Deferred charges and other assets	4
Operating lease ROU assets	3,617
Total assets acquired	910,221
Accounts payable	34,314
Accrued expenses	7,140
Contract liabilities	642
Operating lease liabilities	3,617
Deferred tax liabilities	19,340
Total liabilities assumed	65,053
Contingent consideration(1)	64,000
Consideration transferred	$	781,168

(1)Pursuant to ASC 805, the Company evaluated the earn-out consideration classification in accordance with ASC 480, Distinguishing Liabilities from Equity (“ASC 480”). The Company determined the earn-out consideration to be classified as a liability based on the settlement provision. Therefore, the Company records the contingent consideration at fair value as of September 30, 2024. Additional discussion in Note 15—Commitments and Contingencies in the Notes to our Condensed Consolidated Financial Statements set forth in this Form 10-Q.

The Company incurred acquisition-related costs of $3.2 million for the nine months ended September 30, 2024, which were included in the “General and administrative expenses” of the Condensed Consolidated Statements of Operations.

The Company’s Condensed Consolidated Statement of Operations included results of operations from Durango starting from the Closing Date through September 30, 2024, which included revenues of $35.8 million and $38.9 million, and net income including noncontrolling interest of $1.4 million and $1.6 million for the three and nine months ended September 30, 2024, respectively.

Supplemental Pro Forma Information

The unaudited supplemental pro forma financial data is for informational purposes only and is not indicative of future results. The results below for the three and nine months ended September 30, 2024 and 2023, respectively, combine the results of the Company and Durango, giving effect to the Durango Acquisition as if it had been completed on January 1, 2023.

	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
	(In thousands)
Revenues	$	396,362	$	410,988	$	1,210,257	$	1,138,419
Net income including noncontrolling interest	$	83,602	$	46,575	$	228,652	$	123,738

Given the assumed pro forma transaction date of January 1, 2023, we removed $3.5 million of acquisition-related expenses for the nine months ended September 30, 2024 and recognized $3.5 million of acquisition-related expenses for the nine months ended September 30, 2023. We also removed $24.0 million of interest expense on Durango’s debt for the nine months ended September 30, 2024, and $3.9 million and $11.1 million for the three and nine months ended September 30, 2023, respectively, as if the business combination had occurred and the debt had been paid off on January 1, 2023.

Midstream Infrastructure Assets

In the first half of 2023, the Partnership closed on a purchase and sale agreement for certain midstream assets for $65.0 million together with a new 20-year midstream service agreement. Midstream assets acquired consisted of water gathering and disposal assets of $61.9 million and intangible right-of-way assets of $3.1 million. In addition, the Partnership entered into an incentive and acceleration agreement related to near term supplemental development activities on acreage dedicated for midstream services to affiliates of the Partnership. Consideration for the incentive and acceleration agreement of $60.0 million was capitalized as a contract asset in accordance with ASC 606, of which $4.7 million was included in “Prepaid and Other Current Assets” and $55.3 million was included in “Deferred Charges and Other Assets” in the Condensed Consolidated Balance Sheet as of the date of acquisition. Acquired net assets from this business combination were included in the Midstream Logistics segment.

Goodwill

The Company had goodwill of $5.1 million recorded in the Midstream Logistic segment related to a past business combination as of September 30, 2024. Goodwill is tested at least annually, or more frequently as events occur or circumstances change that would more-likely-than-not reduce fair value of a reporting unit below its carrying value. Company’s management assessed whether there have been events or circumstances that trigger the fair value of the reporting unit to be lower than its net carrying value since consummation of the respective business combination and concluded that goodwill was not impaired as of September 30, 2024.

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REVENUE RECOGNITION

9 Months Ended

Sep. 30, 2024

Revenue from Contract with Customer [Abstract]

REVENUE RECOGNITION

REVENUE RECOGNITION

Disaggregation of Revenue

The following table presents a disaggregation of the Company’s revenue:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
	(In thousands)
Gathering and processing services	$	103,100	$	104,349	$	301,710	$	310,325
Natural gas, NGLs and condensate sales	290,423		221,280		787,092		586,534
Other revenue	2,839		4,672		8,411		10,685
Total revenues	$	396,362	$	330,301	$	1,097,213	$	907,544

There have been no significant changes to the Company’s contracts with customers during the three and nine months ended September 30, 2024 aside from the addition of certain gas gathering and processing agreements associated with the Durango acquisition. The Company did not recognize revenues from MVC deficiency payments for the three and nine months ended September 30, 2024 and recognized $0.4 million and $1.6 million of revenues from MVC deficiency payments for the three and nine months ended September 30, 2023, respectively.

Remaining Performance Obligations

The following table presents our estimated revenue from contracts with customers for remaining performance obligations that have not yet been recognized, representing our contractually committed revenues as of September 30, 2024:

	Amount
Fiscal Year	(In thousands)
Remaining of 2024	$	7,049
2025	71,507
2026	75,387
2027	73,945
2028	72,873
Thereafter	230,750
	$	531,511

Our contractually committed revenue, for the purposes of the tabular presentation above, is limited to customer contracts that have fixed pricing and fixed volume terms and conditions, including contracts with payment obligations associated with MVCs.

Contract Liabilities

The following table provides information about contract liabilities from contracts with customers as of September 30, 2024:

	Amount
	(In thousands)
Balance at December 31, 2023	$	32,238
Reclassification of beginning contract liabilities to revenue as a result of performance obligations being satisfied	(5,182)
Cash received in advance and not recognized as revenue	997
Balance at September 30, 2024	28,053
Less: Current portion	6,195
Non-current portion	$	21,858

Contract liabilities relate to payments received in advance of satisfying performance obligations under a contract, which result from contribution in aid of construction payments. Current and noncurrent contract liabilities are included in “Other Current Liabilities” and “Contract Liabilities,” respectively, in the Condensed Consolidated Balance Sheets.

Contract Cost Assets

The Company has capitalized certain costs incurred to obtain a contract or additional contract dedicated acreage or volumes that would not have been incurred if the contract or associated acreage and volumes had not been obtained. As of September 30, 2024 and December 31, 2023, the Company had contract acquisition cost assets of $66.2 million and $71.2 million, respectively. Current and noncurrent contract cost assets are included in “Prepaid and Other Current Assets” and “Deferred Charges and Other Assets,” respectively, in the Condensed Consolidated Balance Sheets. The Company amortizes these assets as cost of sales on a straight-line basis over the life of the associated long-term customer contracts. The Company recognized cost of sales associated with these assets of $1.7 million for the three months ended September 30, 2024 and 2023, respectively, and $5.0 million for the nine months ended September 30, 2024 and 2023, respectively.

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PROPERTY, PLANT AND EQUIPMENT

9 Months Ended

Sep. 30, 2024

Property, Plant and Equipment [Abstract]

PROPERTY, PLANT AND EQUIPMENT

PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment, at carrying value, is as follows:

	September 30,		December 31,
	2024		2023
	(In thousands)
Gathering, processing, and transmission systems and facilities	$	3,715,716	$	3,253,539
Vehicles	14,714		11,447
Computers and equipment	7,830		6,242
Less: accumulated depreciation	(759,280)		(626,223)
Total depreciable assets, net	2,978,980		2,645,005
Construction in progress	217,637		74,369
Land	30,267		23,853
Total property, plant, and equipment, net	$	3,226,884	$	2,743,227

The cost of property classified as “Construction in progress” is excluded from capitalized costs being depreciated. These amounts represent property that is not yet available to be placed into productive service as of the respective reporting date. The Company recorded $48.7 million and $39.4 million of depreciation expense for the three months ended September 30, 2024 and 2023, respectively, and $135.3 million and $116.6 million for the nine months ended September 30, 2024 and 2023, respectively. There were no impairment triggering events for property, plant and equipment during the three and nine months ended September 30, 2024 and 2023.

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INTANGIBLE ASSETS, NET

9 Months Ended

Sep. 30, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

INTANGIBLE ASSETS, NET

INTANGIBLE ASSETS, NET

Intangible assets, net, are comprised of the following:

	September 30,		December 31,
	2024		2023
	(In thousands)
Customer contracts	$	1,460,287	$	1,139,665
Right of way assets	199,129		141,711
Less accumulated amortization	(781,275)		(689,706)
Total amortizable intangible assets, net	$	878,141	$	591,670

The fair value of acquired customer contracts was capitalized as a result of acquiring favorable customer contracts as of the closing dates of certain past acquisitions and is being amortized using a straight-line method over the remaining terms of the customer contracts, which range from one to seventeen years. Right-of-way assets relate primarily to underground pipeline easements which generally have a useful life of ten years and are amortized using the straight-line method. The right of way agreements are typically for an initial term of ten years with an option to renew for an additional ten years at agreed upon renewal rates based on certain indices or up to 130% of the original consideration paid.

On September 30, 2024, the remaining weighted average amortization periods for customer contracts and right of way assets were approximately 9.03 years and 6.67 years, respectively. The overall remaining weighted average amortization period for the intangible assets as of September 30, 2024 was approximately 8.69 years.

The Company recorded $38.9 million and $30.6 million of amortization expense for the three months ended September 30, 2024 and 2023, respectively, and $100.9 million and $91.6 million for the nine months ended September 30, 2024 and 2023, respectively. There was no impairment recognized on intangible assets for the three and nine months ended September 30, 2024 and 2023.

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EQUITY METHOD INVESTMENTS

9 Months Ended

Sep. 30, 2024

Equity Method Investments and Joint Ventures [Abstract]

EQUITY METHOD INVESTMENTS

EQUITY METHOD INVESTMENTS

As of September 30, 2024, the Company owned investments in the following long-haul pipeline entities in the Permian Basin. These investments were accounted for using the equity method of accounting. For each EMI pipeline entity, the Company has the ability to exercise significant influence based on certain governance provisions and its participation in the significant activities and decisions that impact the management and economic performance of the EMI pipeline. The table below presents the ownership percentages and investment balances held by the Company for each entity:

		September 30,		December 31,
	Ownership(1)	2024		2023
		(In thousands)
PHP	55.5%	$	1,623,127	$	1,666,254
Breviloba	33.0%	433,193		443,684
Epic Crude Holdings, LP (“EPIC”)(1)	27.5%	85,627		—
Gulf Coast Express Pipeline LLC (“GCX”)(2)	—%	—		431,051
		$	2,141,947	$	2,540,989

(1)Investment balance is primarily comprised of the additional 12.5% interest that was acquired during July 2024.

(2)The Company owned 16% of GCX as of December 31, 2023 and divested entire ownership in June 2024.

During the quarter, the Company entered into an Equity Sale and Purchase Agreement with third parties to purchase a 12.5% equity interest in EPIC, increasing our total equity interest in EPIC to 27.5%. As the increase in ownership did not result in a controlling interest, and did not represent the funding of prior losses, the Company resumed accounting for its investment in EPIC using the equity method of accounting upon the closing of the acquisition of the additional interests during July 2024.

On June 4, 2024, the Company consummated the previously announced transaction contemplated by the Purchase and Sale Agreement dated as of May 9, 2024, to sell its 16% equity interest in GCX to GCX Pipeline, LLC (the "GCX Buyer") for an adjusted price of $524.4 million (the "GCX Sale"), including a $30.0 million earn out in cash upon the approval by the GCX Board of Directors of one or more capital projects that achieve certain capacity expansion criteria. The Company recognized a net gain of $89.8 million for the nine months ended September 30, 2024 in relation to this transaction.

The unamortized basis differences included in the EMI pipeline balances were $365.7 million and $349.3 million as of September 30, 2024 and December 31, 2023, respectively. These amounts represent differences in the Company’s contributions to date and the Company’s underlying equity in the separate net assets within the financial statements of the respective entities. Unamortized basis differences will be amortized or accreted into equity income of unconsolidated affiliates over the useful lives of the underlying pipeline assets. There was capitalized interest of $24.1 million and $24.7 million as of September 30, 2024 and December 31, 2023, respectively. Capitalized interest is amortized on a straight-line basis into equity income of unconsolidated affiliates.

The following table presents the activity in the Company’s EMIs for the nine months ended September 30, 2024:

	Permian Highway Pipeline LLC		Breviloba, LLC		EPIC Crude Holdings, LP		Gulf Coast Express Pipeline LLC		Total
	(In thousands)
Balance at December 31, 2023	$	1,666,254	$	443,684	$	—	$	431,051	$	2,540,989
Contributions and acquisitions	3,273		—		85,417		—		88,690
Distributions(1)	(177,172)		(33,677)		—		(15,610)		(226,459)
Disposition	—		—		—		(430,941)		(430,941)
Equity income, net(2)	130,772		23,186		210		15,500		169,668
Balance at September 30, 2024	$	1,623,127	$	433,193	$	85,627	$	—	$	2,141,947

(1)Distributions consisted of distributions from a return on investment of $223.7 million, which was included in cash flows from operating activities and distributions from a return of investment of $2.8 million, which was included in cash flows from investing activities.

(2)For the nine months ended September 30, 2024, net of amortization and accretion of basis differences and capitalized interests, which represents undistributed earnings, the amortization was $5.9 million from PHP, $0.5 million from Breviloba, LLC, $2.7 million from GCX and accretion of $1.6 million from EPIC.

Summarized Financial Information

The following table represents selected data for the Company’s ongoing EMI pipelines (on a 100 percent basis) for the three and nine months ended September 30, 2024 and 2023.

	Three Months Ended September 30,
	2024						2023
	Permian Highway Pipeline LLC		Breviloba, LLC		EPIC Crude Holdings, LP		Permian Highway Pipeline LLC		Breviloba, LLC		EPIC Crude Holdings, LP
	(In thousands)
Revenues	$	127,719	$	53,929	$	97,514	$	99,923	$	51,002	$	93,138
Operating income	83,785		27,398		25,052		65,549		25,170		22,521
Net income (loss)	83,783		27,558		(5,159)		66,630		25,223		(11,330)

	Nine Months Ended September 30,
	2024						2023
	Permian Highway Pipeline LLC		Breviloba, LLC		EPIC Crude Holdings, LP		Permian Highway Pipeline LLC		Breviloba, LLC		EPIC Crude Holdings, LP
	(In thousands)
Revenues	$	380,359	$	156,326	$	284,050	$	291,859	$	143,544	$	259,250
Operating income	245,467		74,563		70,631		185,862		69,666		36,148
Net income (loss)	245,016		75,005		(29,889)		190,662		70,086		(62,312)

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DEBT AND FINANCING COSTS

9 Months Ended

Sep. 30, 2024

Debt Disclosure [Abstract]

DEBT AND FINANCING COSTS

DEBT AND FINANCING COSTS

Accounts Receivable Securitization Facility

On April 2, 2024, Kinetik Receivables LLC (“Kinetik Receivables”), a bankruptcy remote special purpose entity formed as a direct subsidiary of the Partnership, which is a subsidiary of the Company, entered into an accounts receivable securitization facility with an initial facility limit of $150.0 million (“A/R Facility”) with PNC Bank, as the administrative agent, and certain purchasers party thereto from time to time, which has a scheduled termination date of April 1, 2025. The aggregate fees and expenses paid directly to third parties in obtaining the A/R Facility totaled $1.1 million and were capitalized as debt issuance costs and included in the Condensed Consolidated Balance Sheets as a current asset within “Prepaid and other current assets”, amortized over the term of the A/R Facility to interest expense using the effective-interest method. There were unamortized debt issuance costs related to the A/R Facility of $0.6 million as of September 30, 2024.

Pursuant to the A/R Facility, the Company and certain of its subsidiaries continuously transfer receivables to Kinetik Receivables and Kinetik Receivables transfers receivables that meet certain qualifying conditions to third-party purchasers in exchange for cash. These receivables are held by Kinetik Receivables and are pledged to secure the collectability of the sold receivables and are accounted for as secured borrowings. The amount available for borrowing at any one time under the A/R Facility is limited to an amount calculated based on the outstanding balance of eligible receivables sold to the purchasers, subject to certain reserves, concentration limits, and other limitations. Under the A/R Facility, the Company is subject to pay a yield to the purchasers equal to SOFR plus a spread adjustment of 0.10% and a drawn fee of 0.90%. The Company also pays a fee of 0.40% on the undrawn committed amount of the A/R Facility. Yield and fees payable by the Company under the AR Facility are due monthly. As of September 30, 2024, eligible accounts receivable of $150.0 million were pledged to the A/R Facility as collateral.

The Partnership has continuing involvement with the receivables transferred by Kinetik Receivables to the third-party purchasers by providing collection services.

The A/R Facility is linked to sustainability performance targets (“SPTs”) with respect to (a) female representation in corporate officer positions and (b) reduction in methane emissions intensity. A positive 0.02% and 0.05% fee and yield rate adjustments will be applied, respectively, if neither of the SPTs have been satisfied and a negative 0.02% and 0.05% fee and interest rate adjustments will be applied, respectively, if both of the SPTs have been satisfied.

The net proceeds of the A/R Facility were used, together with cash on hand, to repay a portion of the outstanding borrowings under the existing term loan credit facility (“Term Loan Credit Facility”), lowering the remaining balance to $1.0 billion. As a result, the maturity of the Term Loan Credit Facility extended to December 8, 2026. The Company recognized a loss on debt extinguishment of $0.5 million for the partial payment made on the Term Loan Credit Facility.

The following table summarizes the Company’s debt obligations as of September 30, 2024 and December 31, 2023:

	September 30,		December 31,
	2024		2023
	(In thousands)
A/R Facility	$	150,000	$	—
Total current debt obligations	$	150,000	$	—
Unsecured term loan	$	1,000,000	$	1,200,000
5.875% senior unsecured notes due 2030 (“2030 Notes”)	1,000,000		1,000,000
6.625% senior unsecured notes due 2028 (“2028 Notes”)	800,000		800,000
$1.25 billion revolving line of credit	507,000		594,000
Total long-term debt	3,307,000		3,594,000
Debt issuance costs, net(1)	(27,432)		(31,510)
Unamortized debt premiums and discounts, net	121		319
Total long-term debt, net	$	3,279,689	$	3,562,809

(1)Excludes unamortized debt issuance costs related to the revolving line of credit. Unamortized debt issuance costs associated with the revolving line of credit were $4.2 million and $5.4 million as of September 30, 2024 and December 31, 2023, respectively. The unamortized debt issuance costs related to the revolving credit facilities were included in the “Deferred charges and other assets” of the Condensed Consolidated Balance Sheets.

The table below presents the components of the Company’s financing costs, net of capitalized interest:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
	(In thousands)
Capitalized interest	$	(2,955)	$	(6,731)	$	(4,885)	$	(13,775)
Debt issuance costs	1,916		1,546		5,497		4,601
Interest expense	67,068		50,194		166,933		139,617
Total financing costs, net of capitalized interest	$	66,029	$	45,009	$	167,545	$	130,443

As of September 30, 2024 and December 31, 2023, unamortized debt issuance costs associated with the 2030 Notes, the 2028 Notes and the Term Loan Credit Facility were $27.4 million and $31.5 million, respectively, and unamortized debt premiums and discount, net, associated with the 2028 Notes and the unsecured term loan were $0.1 million and $0.3 million, respectively.

Compliance with our Covenants

Each of the revolving credit agreements with Bank of America, N.A. as administrative agent and the Term Loan Credit Facility, contain customary covenants and restrictive provisions which may, among other things, limit the Partnership’s ability to create liens, incur additional indebtedness and make restricted payments and the Partnership’s ability to liquidate, dissolve, consolidate with or merge into or with any other person. The 2030 Notes and the 2028 Notes also contain covenants and restrictive provisions, which may, among other things, limit the Partnership’s and its subsidiaries’ ability to create liens to secure indebtedness.

The A/R Facility contains covenants and restrictive provisions with respect to the Partnership and Kinetik Receivables that are customary for accounts receivable securitization facilities. As of September 30, 2024, the Partnership was in compliance with all customary and financial covenants.

Letters of Credit

Our $1.25 billion senior unsecured revolving credit facility (the “Revolving Credit Facility”) scheduled to mature on or before June 8, 2027 can be used for letters of credit. Our obligations with respect to related letters of credit totaled $12.6 million as of September 30, 2024 and December 31, 2023, respectively. As of September 30, 2024, the Revolving Credit Facility has a borrowing base of $730.4 million available.

Fair Value of Financial Instruments

The fair value of the Company and its subsidiaries’ consolidated debt as of September 30, 2024 and December 31, 2023 was $3.48 billion and $3.57 billion, respectively. On September 30, 2024, the senior unsecured notes’ fair value was based on Level 1 inputs, the Term Loan Credit Facility and Revolving Credit Facility’s fair value was based on Level 3 inputs and the A/R Facility’s fair value approximates its carrying value due to its short term nature.

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ACCRUED EXPENSES

9 Months Ended

Sep. 30, 2024

Payables and Accruals [Abstract]

ACCRUED EXPENSES

ACCRUED EXPENSES

The following table provides detail of the Company’s current accrued expenses on September 30, 2024 and December 31, 2023:

	September 30,		December 31,
	2024		2023
	(In thousands)
Accrued product purchases	$	97,635	$	109,172
Accrued taxes	20,270		632
Accrued salaries, vacation, and related benefits	5,349		1,872
Accrued capital expenditures	13,911		18,534
Accrued interest	34,070		33,760
Accrued other expenses	20,554		13,451
Total accrued expenses	$	191,789	$	177,421

Accrued product purchases mainly accrue the liabilities related to producer payments and any additional business-related miscellaneous fees we owe to third parties, such as transport or capacity fees as of September 30, 2024.

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EQUITY

9 Months Ended

Sep. 30, 2024

Equity [Abstract]

EQUITY

EQUITY

Redeemable Noncontrolling Interest — Common Unit Limited Partners

The redemption option of the Common Unit is not legally detachable or separately exercisable from the instrument and is non-transferable; the Common Unit is redeemable at the option of the holder. Therefore, the Common Unit is accounted for as redeemable noncontrolling interest and classified as temporary equity on the Company’s Condensed Consolidated Balance Sheets. During the nine months ended September 30, 2024, 146,250 Common Units were redeemed on a one-for-one basis for shares of Class A Common Stock, par value $0.0001 per share of the Company (“Class A Common Stock”) and a corresponding number of shares of Class C Common Stock were cancelled. In addition, as part of the Durango Acquisition purchase price consideration, approximately 3.8 million shares of Class C Common Stock and an equivalent number of Common Units were issued at closing. There were 97.8 million Common Units and an equal number of Class C Common Stock issued and outstanding as of September 30, 2024 and 7.7 million shares of Class C Common Stock and equivalent number of Common Units of deferred consideration for the Durango Acquisition that will be issued on July 1, 2025. The Common Units fair value was approximately $4.78 billion, including deferred consideration valued as of September 30, 2024.

Common Stock

As of September 30, 2024, there were 59.8 million and 97.8 million shares, respectively, of Class A Common Stock and Class C Common Stock issued and outstanding (collectively, “Common Stock”). In addition, 7.7 million shares of Class C Common Stock will be issued as deferred consideration for the Durango Acquisition on July 1, 2025.

Share Repurchase Program

During the quarter ended September 30, 2024, the Company did not repurchase any of its Class A Common Stock under the Repurchase Program.

Dividend

On August 7, 2024, the Company made cash dividend payments of $118.2 million to holders of Class A Common Stock and Common Units and $0.4 million was reinvested in shares of Class A Common Stock. The significant decrease in the amount reinvested in shares of Class A Common Stock compared with prior quarters was due to the automatic termination of the Dividend and Distribution Reinvestment Agreement on March 8, 2024.

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FAIR VALUE MEASUREMENTS

9 Months Ended

Sep. 30, 2024

Fair Value Disclosures [Abstract]

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS

The following tables present financial assets and liabilities that are measured at fair value on a recurring basis as of September 30, 2024 and December 31, 2023:

	September 30, 2024
	Level 1		Level 2		Level 3		Total
	(In thousands)
Commodity swap	$	—	$	7,785	$	—	$	7,785
Interest rate derivatives	—		84		—		84
Total assets	$	—	$	7,869	$	—	$	7,869
Commodity swaps	$	—	$	3,936	$	—	$	3,936
Interest rate derivatives	—		3,888		—		3,888
Contingent liability	—		—		65,400		65,400
Total liabilities	$	—	$	7,824	$	65,400	$	73,224

	December 31, 2023
	Level 1		Level 2		Level 3		Total
	(In thousands)
Commodity swap	$	—	$	3,663	$	—	$	3,663
Interest rate derivatives	—		4,314		—		4,314
Total assets	$	—	$	7,977	$	—	$	7,977
Commodity swaps	$	—	$	1,749	$	—	$	1,749
Interest rate derivatives	—		5,348		—		5,348
Total liabilities	$	—	$	7,097	$	—	$	7,097

Our derivative contracts consist of interest rate swaps and commodity swaps. The valuation of these derivative contracts involved both observable publicly quoted prices and certain credit valuation inputs that may not be readily observable in the marketplace. As such derivative contracts are classified as Level 2 in the hierarchy. Refer to Note 11—Derivatives and Hedging Activities in the Notes to Condensed Consolidated Financial Statements in this Quarterly Report on Form 10-Q for further discussion related to commodity swaps and interest rate derivatives.

The Company recorded a contingent liability related to the Kings Landing Earnout using Level 3 inputs, including projected spending and completion probability of the project. Refer to Note 15—Commitments and Contingencies in the Notes to Condensed Consolidated Financial Statements in this Quarterly Report on Form 10-Q for further discussion related to Kings Landing Earnout contingent liability.

Long-term debt’s carrying value can vary from fair value. See Note 7—Debt and Financing Costs in the Notes to Condensed Financial Statements for further information. The carrying amounts reported on the Condensed Consolidated Balance Sheets for the Company’s remaining financial assets and liabilities approximate fair value due to their short-term nature. There were no transfers between Level 1, Level 2 or Level 3 of the fair value hierarchy during the nine months ended September 30, 2024 and 2023.

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DERIVATIVES AND HEDGING ACTIVITIES

9 Months Ended

Sep. 30, 2024

Derivative Instruments and Hedging Activities Disclosure [Abstract]

DERIVATIVES AND HEDGING ACTIVITIES

DERIVATIVES AND HEDGING ACTIVITIES

The Company is exposed to certain risks arising from both its business operations and economic conditions, and it enters into certain derivative contracts to manage exposure to these risks. To minimize counterparty credit risk in derivative instruments, the Company enters into transactions with high credit-rating counterparties. The Company did not elect to apply hedge accounting to these derivative contracts and recorded the fair value of the derivatives on the Condensed Consolidated Balance Sheets as of September 30, 2024 and December 31, 2023.

Interest Rate Risk

The Company manages market risks, including interest rate, liquidity and credit risk primarily by managing the amount, sources and duration of its debt funding and by using derivative financial instruments. Specifically, the Company enters into derivative financial instruments to manage exposures that arise from activities that result in the payment of future known and uncertain cash amounts, the value of which is determined by interest rates.

The Company’s objectives in using interest rate derivatives are to add stability to interest expense and to manage its exposure to interest rate movements. To accomplish this objective, the Company primarily uses interest rate swaps as part of its interest rate risk management strategy. Interest rate swaps designated as cash flow hedges involve the receipt of variable amounts from a counterparty if interest rates rise above the strike rate on the contract.

As of September 30, 2024, the Company had two interest rate swap contracts with total notional amounts of $1.70 billion maturing on May 31, 2025 that pay a fixed rate ranging from 4.38% to 4.48% and one interest rate swap contract with a notional amount of $0.08 billion maturing on December 31, 2025 that pays a fixed rate of 3.02%. The fair value or settlement value of the consolidated interest rate swaps outstanding are presented on a gross basis on the Condensed Consolidated Balance Sheets. The following table presents the fair value of derivative assets and liabilities related to the interest rate swap contracts:

	September 30,		December 31,
	2024		2023
	(In thousands)
Derivatives assets - current	$	76	$	4,314
Derivative assets - noncurrent	8		—
Total derivative assets	$	84	$	4,314
Derivative liabilities - current	$	3,888	$	—
Derivatives liabilities - noncurrent	—		5,348
Total derivative liabilities	$	3,888	$	5,348

The Company recorded cash settlements and changes in fair value of the interest rate swap contracts in “Interest expense” of the Condensed Consolidated Statements of Operations. The following table presents interest rate swap derivatives activities for the three and nine months ended September 30, 2024 and 2023:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
	(In thousands)
Realized gain on interest rate swaps	$	3,994	$	4,665	$	11,899	$	7,082
(Unfavorable) favorable fair value adjustment	$	(8,342)	$	12,500	$	9,129	$	34,562

Commodity Price Risk

The results of the Company’s operations may be affected by the market prices of oil, natural gas and NGLs. A portion of the Company’s revenue is directly tied to local natural gas, natural gas liquids and condensate prices in the Permian Basin and the U.S. Gulf Coast. Fluctuations in commodity prices also impact operating cost elements both directly and indirectly. Management regularly reviews the Company’s potential exposure to commodity price risk and manages exposure of such risk through commodity hedge contracts.

During the past twelve months, the Company entered into multiple commodity swap contracts based on the OPIS NGL Mont Belvieu prices for ethane, propane and butane, the Waha Basis index, the HSC index and the NYMEX West Texas Intermediate Control index. These contracts are for various notional quantities of NGLs, natural gas and crude. Similarly, the Company has entered into various natural gas and crude basis spread swaps. These contracts are effective over the next 1 to 20 months and are used to hedge against location price risk of the respective commodity resulting from supply and demand volatility and protect cash flows against price fluctuations.

The following table presents detailed information of commodity swaps outstanding as of September 30, 2024 (in thousands, except volumes):

	September 30, 2024
Commodity	Unit	Notional Volume	Net Fair Value
Natural Gas	MMBtus	1,210,000	$	569
NGL	Gallons	312,215,400	917
Crude	Bbl	613,000	2,563
Crude Collars	Bbl	163,800	937
Crude Basis Spread Swaps	Bbl	22,400	(9)
Natural Gas Basis Spread Swaps	MMBtus	7,300,000	(1,128)
			$	3,849

The fair value or settlement value of the swaps outstanding are presented on a gross basis on the Condensed Consolidated Balance Sheets. The following table presents the fair value of derivative assets and liabilities related to commodity swaps:

	September 30,		December 31,
	2024		2023
	(In thousands)
Derivatives assets - current	$	6,200	$	3,498
Derivative assets - noncurrent	1,585		165
Total derivative assets	$	7,785	$	3,663
Derivative liabilities - current	$	2,855	$	1,734
Derivatives liabilities - noncurrent	1,081		15
Total derivative liabilities	$	3,936	$	1,749

The Company recorded cash settlements and fair value adjustments on commodity swap derivatives in “Product revenue” of the Consolidated Statements of Operations. The following table presents commodity swap derivatives activities for the three and nine months ended September 30, 2024 and 2023:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
	(In thousands)
Realized (loss) gain on commodity swaps	$	(2,790)	$	176	$	(20,002)	$	8,029
Favorable (unfavorable) fair value adjustment	$	6,027	$	(8,083)	$	(18,067)	$	6,466

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SHARE-BASED COMPENSATION

9 Months Ended

Sep. 30, 2024

Share-Based Payment Arrangement [Abstract]

SHARE-BASED COMPENSATION

SHARE-BASED COMPENSATION

The Company granted various Class A and Class C Shares, restricted stock units (“RSUs”) and performance stock units (“PSUs”) to members of the Board of Directors (the “Board”) and employees. The Class A Shares and Class C Shares and RSUs are subject to service requirements for vesting and the PSUs have both service requirements and market condition performance requirements for vesting. These units are recorded at grant-date fair value and compensation expense is recognized on a straight‑line or graded straight-line basis over the vesting period within “General and Administrative Expenses” of the Condensed Consolidated Statements of Operations in accordance with FASB ASC 718, Compensation - Stock Compensation. Forfeitures are recognized as they occur.

Class A Shares and Class C Shares

The table below summarizes Class A Share and Class C Share activities for the nine months ended September 30, 2024:

	Number of Shares	Weighted Avg Grant-Date Fair Market Value Per Unit
Outstanding and unvested shares at December 31, 2023	5,444,488	$	28.91
Vested	43,166	31.18
Forfeited	1,592	31.18
Outstanding and unvested shares at September 30, 2024	5,399,730	$	28.90

Table below summarizes aggregate intrinsic value (market value at vesting date) and grant-date fair value of vested Class A Shares for the nine months ended September 30, 2024:

	Three Months Ended		Nine Months Ended
	September 30, 2024		September 30, 2024
	(In thousands)
Aggregate intrinsic value of vested Class A Shares	$	1,102	$	1,756
Grant-date fair value of vested Class A Shares	$	834	$	1,346

No vesting or forfeiture occurred for Class C Shares for the three and nine months ended September 30, 2024 and 2023. No vesting occurred for Class A Shares for the three and nine months ended September 30, 2023. As of September 30, 2024, there were $38.8 million of unrecognized compensation costs related to unvested Class A Shares and Class C Shares. These costs are expected to be recognized over a weighted average period of 1.16 years.

Restricted Stock Units

RSUs were granted to certain executives and employees under the Kinetik Holdings Inc. Amended and Restated 2019 Omnibus Compensation Plan (the “2019 Plan”) with various service vesting requirements. Such RSUs may be settled only for shares of Class A Common Stock on a one-for-one basis, contingent upon continued employment.

The table below summarizes RSUs activities for the nine months ended September 30, 2024:

	Number of Shares(1)	Weighted Avg Grant-Date Fair Market Value Per Unit(1)
Outstanding and unvested shares at December 31, 2023	435,220	$	31.15
Granted	610,333	35.41
Vested	323,158	34.79
Forfeited	12,565	33.06
Outstanding and unvested shares at September 30, 2024	709,830	$	33.12

(1)The number of shares and weighted average fair market value per share include RSUs issued to new employees that transitioned from ALTM as part of the merger as replacement awards.

Table below summarizes aggregate intrinsic value (market value at vesting date) and grant-date fair value of RSUs for the three and nine months ended September 30, 2024 and 2023.

	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
	(In thousands)
Aggregate intrinsic value of vested RSUs	$	387	$	34	$	11,469	$	7,340
Grant-date fair value of vested RSUs	$	372	$	35	$	11,243	$	6,827

As of September 30, 2024, there were $13.0 million of unrecognized compensation costs related to the RSUs. These costs are expected to be recognized over a weighted average period of 1.64 years.

Performance Stock Units

The Company granted PSUs pursuant to the 2019 Plan to certain of its employees and executives during 2024. These PSUs vest and become earned upon the achievement of certain performance goals based on the Company’s annualized absolute total stockholder return and the Company’s relative total stockholder return as compared to the performance peer group during a three-year performance period. Depending on the results achieved during the three-year performance period, the actual number of Class A Common Stock that a holder of the PSUs earns at the end of the performance period may range from 0% to 200% of the target number of PSUs granted. The fair value of the PSUs is determined using a Monte Carlo simulation at the grant date. The Company recognized compensation expense for PSUs on a straight-line basis over the performance period. Any PSU not earned at the end of the performance period will be forfeited.

The table below summarizes PSU activities for the nine months ended September 30, 2024:

	Number of Shares	Weighted Avg Grant-Date Fair Market Value Per Unit
Granted in 2024	198,703	$	36.76
Outstanding and unvested shares at September 30, 2024	198,703	$	36.76

No vesting or forfeiture occurred for PSUs for the three and nine months ended September 30, 2024.

The table below presents a summary of the grant-date fair value assumptions used to value the PSUs on grant date:

	March 2024
Grant-date fair value per unit	$36.76
Beginning average price	$32.84
Risk-free interest rate	4.21%
Volatility factor	37%
Expected term	2.82 years

As of September 30, 2024, there were $5.8 million of unrecognized compensation costs related to the PSUs. These costs are expected to be recognized over a weighted average period of 2.25 years.

With respect to above Class A Shares, Class C Shares, RSUs and PSUs, the Company recorded compensation expenses of $15.2 million and $12.5 million for the three months ended September 30, 2024 and 2023, respectively, and $52.9 million and $43.3 million for the nine months ended September 30, 2024 and 2023.

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INCOME TAXES

9 Months Ended

Sep. 30, 2024

Income Tax Disclosure [Abstract]

INCOME TAXES

INCOME TAXES

The Company is subject to U.S. federal income tax and state taxes. Income tax expense included in the condensed consolidated financial statements in this Quarterly Report on Form 10-Q is as follows:

	Three Months Ended September 30,						Nine Months Ended September 30,
	2024			2023			2024			2023
	(In thousands)
Income before income taxes	$	91,914		$	44,434		$	249,270		$	121,128
Income tax expense	$	8,260		$	1,303		$	21,261		$	2,030
Effective tax rate	8.99		%	2.93		%	8.53		%	1.68		%

The effective tax rate for the three and nine months ended September 30, 2024 was lower than the statutory rate mainly due to the impact of tax attributable to noncontrolling interests related to the Common Unit limited partners.

The effective tax rate for the three and nine months ended September 30, 2023 was lower than the statutory rate mainly due to the impact of tax attributable to noncontrolling interests related to the Common Unit limited partners and a full valuation allowance on deferred tax assets as of September 30, 2023.

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NET INCOME PER SHARE

9 Months Ended

Sep. 30, 2024

Earnings Per Share [Abstract]

NET INCOME PER SHARE

NET INCOME PER SHARE

The computation of basic and diluted net income per share for the periods presented in the condensed consolidated financial statements is shown in the tables below:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
	(In thousands, except per share amounts)
Net income attributable to Class A common shareholders	$	25,763	$	15,580	$	74,505	$	42,030
Less: Net income available to participating unvested restricted Class A common shareholders(1)	(4,755)		(4,414)		(13,636)		(12,996)
Total net income attributable to Class A common shareholders	$	21,008	$	11,166	$	60,869	$	29,034
Weighted average shares outstanding - basic	59,811		53,340		59,116		50,464
Dilutive effect of unvested Class A common shares(2)	613		123		736		255
Weighted average shares outstanding - diluted(2)(3)	60,424		53,463		59,852		50,719
Net income available per common share - basic	$	0.35	$	0.21	$	1.03	$	0.58
Net income available per common share - diluted	$	0.35	$	0.21	$	1.02	$	0.57

(1)Represents dividends paid to unvested Class A and Class C Shares, RSUs and PSUs.

(2)Includes dilutive effect from both RSUs and PSUs on unvested Class A common shares.

(3)The effect of an assumed exchange of outstanding Common Units (and the cancellation of a corresponding number of shares of outstanding Class C Common Stock) would have been anti-dilutive for all periods presented in which the Common Units were outstanding.

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COMMITMENTS AND CONTINGENCIES

9 Months Ended

Sep. 30, 2024

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES

Accruals for loss contingencies arising from claims, assessments, litigation, environmental and other sources are recorded when it is probable that a liability has been incurred and the amount can be reasonably estimated. These accruals are adjusted as additional information becomes available or circumstances change. As of September 30, 2024 and December 31, 2023, there were no accruals for loss contingencies.

Litigation

The Company is a party to various legal actions arising in the ordinary course of its business. In accordance with FASB ASC 450, Contingencies, the Company accrues reserves for outstanding lawsuits, claims and proceedings when a loss contingency is probable and can be reasonably estimated. The Company estimates the amount of loss contingencies using current available information from legal proceedings, advice from legal counsel and available insurance coverage. Due to the inherent subjectivity of the assessments and unpredictability of the outcomes of the legal proceedings, any amounts accrued or included in this aggregate amount may not represent the ultimate loss to the Company from the legal proceedings in question. There were no litigation-related accrued reserves as of September 30, 2024 and December 31, 2023.

The Company has entered into litigation with a third party to collect receivables totaling $11.6 million and is waiting on settlement of $8.0 million in outstanding vendor credits from another counterparty related to prior litigation the Company had previously entered into and subsequently dropped. These amounts remain outstanding from the Winter Storm Uri during February of 2021. Given the counterparties’ sufficient creditworthiness and the valid claims that we hold, no allowance has currently been established for these items as we have legally enforceable agreements with these parties.

Environmental Matters

The Company is subject to various local, state, and federal laws and regulations relating to various environmental matters during the ordinary course of business. Although we believe our operations are in substantial compliance with applicable environmental laws and relations, risks of additional costs and liabilities are inherent in our operations. Moreover, changes in environmental laws and regulations occur frequently, and any changes that result in more stringent or costly requirements could require the Company to make significant expenditures to attain and maintain compliance or may otherwise have a material adverse effect on its operations, competitive position, or financial condition. The Company is not aware of any material environmental claims existing as of September 30, 2024, that have not been provided for or would otherwise have a material impact on its financial position, results of operations, or liquidity.

Contingent Liabilities

Durango Acquisition

On June 24, 2024, the Company consummated the previously announced Durango Acquisition. Pursuant to the Durango MIPA, Durango Seller is entitled to an earn out of up to $75.0 million in cash contingent upon the completion of the Kings Landing Project and placing it into service in Eddy County, New Mexico. This earn out is subject to reduction based on actual capital costs associated with the Kings Landing Project.

Upon Closing, the Company evaluated the earn-out consideration classification in accordance with ASC 480. The Company determined the earn-out consideration to be classified as a liability based on the settlement provision. As of Closing, the Company recorded an initial contingent liability of $64.0 million based on the project’s completion probability and projected spend. Pursuant to ASC 805, the Company recorded a subsequent fair value adjustment of $1.4 million within “Costs of sales (exclusive of depreciation and amortization)” of the Condensed Consolidated Statement of Operations for the three months ended September 30, 2024. The contingent liability associated with the Kings Landing Project was $65.4 million as of September 30, 2024.

Permian Gas Acquisition

As part of the acquisition of Permian Gas on June 11, 2019, consideration included a contingent liability arrangement with PDC Permian, Inc. (“PDC”). The arrangement requires additional monies to be paid by the Company to PDC on a per Mcf basis if the actual annual Mcf volume amounts exceed forecasted annual Mcf volume amounts starting in 2020 and continuing through 2029. The total monies paid under this arrangement are capped at $60.5 million and are payable on an annual basis over the earn-out period. PDC’s actual annual Mcf volume did not exceed the incentive forecast volume during the past four years, and is not expected to over the next five years; therefore, the estimated fair value of the contingent consideration liability was nil as of September 30, 2024 and December 31, 2023.

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SEGMENTS

9 Months Ended

Sep. 30, 2024

Segment Reporting [Abstract]

SEGMENTS

SEGMENTS

Our two operating segments represent the Company’s segments for which discrete financial information is available and is utilized on a regular basis by our CODM to make key operating decisions, assess performance and allocate resources. These segments represent strategic business units with differing products and services. No operating segments have been aggregated to form the reportable segments. Therefore, our two operating segments represent our reportable segments. The activities of each of our reportable segments from which the Company earns revenues and incurs expenses are described below:

•Midstream Logistics: The Midstream Logistics segment operates under three streams, 1) gas gathering, processing and treating, 2) crude oil gathering, stabilization and storage services and 3) produced water gathering and disposal.

•Pipeline Transportation: The Pipeline Transportation segment consists of equity investment interests in three Permian Basin pipelines that access various points along the U.S. Gulf Coast, as well as Kinetik NGL and Delaware Link Pipelines. The current operating pipelines transport crude oil, natural gas and NGLs.

Our Chief Executive Officer, who is the CODM, uses Segment Adjusted EBITDA, a non-GAAP measure, to measure profitability and allocate resources among segments. Segment Adjusted EBITDA, a non-GAAP measure, is defined as segment net earnings adjusted to exclude interest expense, income tax expense, depreciation and amortization, the proportionate effect of these same items for our EMI pipelines and other non-recurring items. The CODM considers budget-to-actual and forecast-to-actual variances on a monthly basis when making decisions about allocating capital and personnel to the segments.

The Midstream Logistics segment accounts for more than 97% of the Company’s operating revenues, more than 99% of the cost of sales (excluding depreciation and amortization) and operating expenses and more than 94% of the ad valorem expenses. The Pipeline Transportation segment contains all of the Company’s equity method investments. Corporate and Other contains the Company’s executive and administrative functions, including 84% of the Company’s General and Administrative Expenses and all of the Company’s debt service costs. For the three months ended September 30, 2024, the Midstream Logistics segment and the Pipeline Transportation segment represent 65% and 36% of total consolidated adjusted EBITDA, respectively, which is consistent with the prior year contributions from each segment.

The following tables present the reconciliation of the non-GAAP measure Segment Adjusted EBITDA to the GAAP measure segment income (loss) before income taxes as of and for the three and nine months period ended September 30, 2024 and 2023:

	Midstream Logistics		Pipeline Transportation		Corporate and Other(1)		Consolidated
	(In thousands)
For the Three Months Ended September 30, 2024
Segment income (loss) before income taxes	$	88,581	$	88,797	$	(85,464)	$	91,914
Add back:
Interest expense	2,666		—		63,363		66,029
Depreciation and amortization expenses	85,273		2,305		5		87,583
Contract assets amortization	1,655		—		—		1,655
Proportionate EMI EBITDA	—		88,229		—		88,229
Share-based compensation	—		—		15,171		15,171
Contingent liabilities fair value adjustment	1,400		—		—		1,400
Integration costs	1,208		—		1,332		2,540
Acquisition transaction costs	—		—		31		31
Other one-time costs or amortization	1,657		—		2,060		3,717
Deduct:
Interest income	—		—		572		572
Commodity hedging unrealized gain	8,817		—		—		8,817
Gain on sale of equity method investment	—		29,953		—		29,953
Equity income from unconsolidated affiliates	—		53,244		—		53,244
Segment Adjusted EBITDA(2)	$	173,623	$	96,134	$	(4,074)	$	265,683

	Midstream Logistics		Pipeline Transportation		Corporate and Other(1)		Consolidated
	(In thousands)
For the Three Months Ended September 30, 2023
Segment income (loss) before income taxes	$	56,584	$	50,598	$	(62,748)	$	44,434
Add back:
Interest expense	12		—		44,997		45,009
Depreciation and amortization expenses	69,456		473		6		69,935
Contract assets amortization	1,655		—		—		1,655
Proportionate EMI EBITDA	—		78,585		—		78,585
Share-based compensation	—		—		12,502		12,502
Loss on disposal of assets	2,927		—		—		2,927
Unrealized loss on derivatives	8,259		—		—		8,259
Integration costs	21		—		—		21
Acquisition transaction costs	—		—		378		378
Other one-time costs or amortization	1,529		—		1,133		2,662
Warrant valuation adjustment	—		—		4		4
Deduct:
Interest income	—		—		293		293
Equity income from unconsolidated affiliates	—		50,754		—		50,754
Segment Adjusted EBITDA(2)	$	140,443	$	78,902	$	(4,021)	$	215,324

	Midstream Logistics		Pipeline Transportation		Corporate and Other(1)		Consolidated
	(In thousands)
For the Nine Months Ended September 30, 2024
Segment income (loss) before income taxes	$	215,196	$	275,246	$	(241,172)	$	249,270
Add back:
Interest expense	5,273		—		162,272		167,545
Depreciation and amortization expenses	229,336		6,897		17		236,250
Contract assets amortization	4,965		—		—		4,965
Proportionate EMI EBITDA	—		262,553		—		262,553
Share-based compensation	—		—		52,868		52,868
Loss on disposal of assets	4,090		—		—		4,090
Loss on debt extinguishment	—		—		525		525
Contingent liabilities fair value adjustment	1,400		—		—		1,400
Integration costs	1,792		—		3,299		5,091
Acquisition transaction costs	—		—		3,538		3,538
Other one-time costs or amortization	4,048		—		4,400		8,448
Deduct
Other interest income	—		—		1,459		1,459
Commodity hedging unrealized gain	1,935		—		—		1,935
Gain on sale of equity method investment	—		89,837		—		89,837
Equity income from unconsolidated affiliates	—		169,668		—		169,668
Segment Adjusted EBITDA(2)	$	464,165	$	285,191	$	(15,712)	$	733,644

	Midstream Logistics		Pipeline Transportation		Corporate and Other(1)		Consolidated
	(In thousands)
For the Nine Months Ended September 30, 2023
Segment income (loss) before income taxes	$	163,794	$	146,524	$	(189,190)	$	121,128
Add back:
Interest expense	32		—		130,411		130,443
Depreciation and amortization expenses	206,855		1,398		18		208,271
Contract assets amortization	4,965		—		—		4,965
Proportionate EMI EBITDA	—		224,933		—		224,933
Share-based compensation	—		—		43,340		43,340
Loss on disposal of assets	15,166		—		—		15,166
Unrealized loss on derivatives	616		—		—		616
Integration costs	29		—		956		985
Acquisition transaction costs	33		—		615		648
Other one-time costs or amortization	5,310		—		2,235		7,545
Deduct:
Interest income	—		—		314		314
Warrant valuation adjustment	—		—		73		73
Equity income from unconsolidated affiliates	—		146,828		—		146,828
Segment Adjusted EBITDA(2)	$	396,800	$	226,027	$	(12,002)	$	610,825

(1)Corporate and Other represents those results that: (i) are not specifically attributable to a reportable segment; (ii) are not individually reportable or (iii) have not been allocated to a reportable segment for the purpose of evaluating their performance, including certain General and Administrative Expense items. Items included here to reconcile operating segments profit and loss with the Company’s consolidated profit and loss.

(2)Segment adjusted EBITDA is a non-GAAP measure; please see Key Performance Metrics in “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations” in this Quarterly Report on Form 10-Q, for a definition and reconciliation to the GAAP measure.

The following tables present the revenue for the individual operating segments for the three and nine month period ended September 30, 2024 and 2023:

	Midstream Logistics		Pipeline Transportation		Elimination		Consolidated
	(In thousands)
For the Three Months Ended September 30, 2024
Revenue	$	391,331	$	2,192	$	—	$	393,523
Other revenue	2,837		2		—		2,839
Intersegment revenue(1)	—		6,748		(6,748)		—
Total segment operating revenue	$	394,168	$	8,942	$	(6,748)	$	396,362

	Midstream Logistics		Pipeline Transportation		Elimination		Consolidated
	(In thousands)
For the Three Months Ended September 30, 2023
Revenue	$	324,863	$	766	$	—	$	325,629
Other revenue	4,670		2		—		4,672
Total segment operating revenue	$	329,533	$	768	$	—	$	330,301

	Midstream Logistics		Pipeline Transportation		Elimination		Consolidated
	(In thousands)
For the Nine Months Ended September 30, 2024
Revenue	$	1,082,236	$	6,566	$	—	$	1,088,802
Other revenue	8,122		289		—		8,411
Intersegment revenue(1)	—		19,288		(19,288)		—
Total segment operating revenue	$	1,090,358	$	26,143	$	(19,288)	$	1,097,213

	Midstream Logistics		Pipeline Transportation		Elimination		Consolidated
	(In thousands)
For the Nine Months Ended September 30, 2023
Revenue	$	894,669	$	2,190	$	—	$	896,859
Other revenue	10,679		6		—		10,685
Total segment operating revenue	$	905,348	$	2,196	$	—	$	907,544

(1)The Company accounts for intersegment sales at market prices, while it accounts for asset transfers at book value. Intersegment revenue is eliminated at consolidation.

The following table presents total assets for each operating segment as of September 30, 2024 and December 31, 2023:

	September 30,		December 31,
	2024		2023
	(In thousands)
Midstream Logistics	$	4,323,444	$	3,772,764
Pipeline Transportation(1)	2,297,544		2,703,588
Segment total assets	6,620,988		6,476,352
Corporate and other	239,473		20,521
Total assets	$	6,860,461	$	6,496,873

(1)Includes investment in unconsolidated affiliates of $2.14 billion and $2.54 billion as of September 30, 2024 and December 31, 2023, respectively

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SUBSEQUENT EVENTS	9 Months Ended
	Sep. 30, 2024
Subsequent Events [Abstract]
SUBSEQUENT EVENTS	SUBSEQUENT EVENTSOn October 17, 2024, the Board declared a cash dividend of $0.78 per share on the Company’s Class A Common Stock which will be payable to stockholders of record as of October 28, 2024 on November 7, 2024. The Company, through its ownership of the general partner of the Partnership, declared a distribution of $0.78 per Common Unit from the Partnership to the holders of Common Units, which will be payable on November 7, 2024.

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Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Pay vs Performance Disclosure
Segment adjusted EBITDA	$ 265,683	$ 215,324	$ 733,644	$ 610,825

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Insider Trading Arrangements	3 Months Ended
	Sep. 30, 2024
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

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DESCRIPTION OF THE ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

9 Months Ended

Sep. 30, 2024

Accounting Policies [Abstract]

Basis of Presentation

Basis of Presentation

The accompanying Condensed Consolidated Financial Statements have been prepared in accordance with GAAP. Certain reclassifications of prior year balances have been made to conform such amounts to the current year’s presentation. These reclassifications have no impact on net income. All adjustments that, in the opinion of management, are necessary for a fair presentation of the results of operations for the interim periods have been made and are of a recurring nature unless otherwise disclosed herein. The results of operations for such interim periods are not necessarily indicative of results of operations for a full year; accordingly, you should read these Condensed Consolidated Financial Statements in conjunction with our consolidated financial statements and related notes included in our 2023 Annual Report on Form 10-K. All intercompany balances and transactions have been eliminated in consolidation.

Accounts Receivable Securitization Facility

Accounts Receivable Securitization Facility

Pursuant to ASC 860, Transfers and Servicing, accounts receivable that are sold or contributed by the Partnership to the special purpose vehicle are treated as collateral for borrowings under the third party A/R Facility (as defined below) and are included as “Accounts receivable pledged” within the Condensed Consolidated Balance Sheet. Proceeds from the transfer of the eligible accounts receivable under the third party A/R Facility are secured borrowings included as “Current debt obligations” within our Condensed Consolidated Balance Sheets. Proceeds and repayments under such facility are reflected as cash flows from financing activities in our Consolidated Statements of Cash Flows. See Note 7—Debt and Financing Costs in the Notes to our Condensed Consolidated Financial Statements set forth in this Form 10-Q for further discussion.

Transactions with related parties

Transactions with related parties

The Company has revenue contracts and incurs cost of sales and operating expenses with Apache Midstream LLC (“Apache”), which owned more than 5% of the Company’s common stock prior to its secondary offerings completed in December 2023 and March 2024. Pursuant to ASC 850, Related Party Transactions, Apache was no longer a related party after the completion of its secondary offering in December 2023 as it owned less than 10% of the Company’s common stock. Pursuant to Regulation S-K, Item 404(a), Apache ceased to be a related party as of March 18, 2024 as it no longer owned any of the Company’s common stock.

Recently issued accounting pronouncements not yet adopted

Recently issued accounting pronouncements not yet adopted

Improvements to Reportable Segment Disclosures

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. The amendments in this update require, among other items, that public entities disclose, on an annual and interim basis, significant segment expenses that are regularly provided to the CODM and included within each reported measure of segment profit or loss. Additionally, the amendments require annual disclosure of the title and position of the CODM and how that individual uses the reported measure(s) of segment profit or loss in assessing segment performance and how to allocate resources.

These amendments are effective for fiscal years beginning after December 15, 2023, and for interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. The disclosures required in the amendments apply retrospectively to all prior periods presented in the financial statements. We are evaluating the effect of the amendments on our consolidated financial statements and expect to disclose the required information for fiscal years beginning in the Annual Report on Form 10-K for the year ended December 31, 2024 and for interim periods beginning in the Quarterly Report on Form 10-Q for the quarter ended March 31, 2025. The impact of the adoption will be limited to additional disclosure in the notes to the consolidated financial statements.

Improvements to Income Tax Disclosures

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The amendments in this update require, among other items, that public entities disclose, on an annual and interim basis, (i) specific categories of income taxes in the rate reconciliation, and (ii) a disaggregation of income taxes paid by federal, state, and foreign taxes.

These amendments are effective for fiscal years beginning after December 15, 2024, with early adoption permitted. The amendments are required to be applied prospectively with retrospective application permitted. We are evaluating the effect of the amendments on our consolidated financial statements and expect to disclose the required information beginning in the Annual Report on Form 10-K for the year ended December 31, 2025.

Business Combination

The Durango Acquisition was accounted for as a business combination in accordance with ASC 805 Business Combination (“ASC 805”). Starting on the Closing Date, our Consolidated Financial Statements reflected Durango as a consolidated subsidiary. The accompanying Condensed Consolidated Financial Statements herein include (i) the combined net assets of the Company carried at historical costs and net assets of Durango carried at fair value as of the Closing Date and (ii) the combined results of operations of the Company with Durango’s results presented within the Condensed Consolidated Financial Statements from the Closing Date going forward.

The fair value of the processing plants, gathering system and related facilities and equipment is based on market and cost approaches and will be depreciated over an estimated useful life ranging from five to thirty yearsThe fair value of the intangible assets is based on the market approach for the right-of-way and discounted cash flow approach for customer contracts, which will be amortized over estimated useful lives ranging from seven to twelve years.Pursuant to ASC 805, the Company evaluated the earn-out consideration classification in accordance with ASC 480, Distinguishing Liabilities from Equity (“ASC 480”). The Company determined the earn-out consideration to be classified as a liability based on the settlement provision.Consideration for the incentive and acceleration agreement of $60.0 million was capitalized as a contract asset in accordance with ASC 606, of which $4.7 million was included in “Prepaid and Other Current Assets” and $55.3 million was included in “Deferred Charges and Other Assets” in the Condensed Consolidated Balance Sheet as of the date of acquisition.

Revenue Recognition

Current and noncurrent contract liabilities are included in “Other Current Liabilities” and “Contract Liabilities,” respectively, in the Condensed Consolidated Balance Sheets.Current and noncurrent contract cost assets are included in “Prepaid and Other Current Assets” and “Deferred Charges and Other Assets,” respectively, in the Condensed Consolidated Balance Sheets. The Company amortizes these assets as cost of sales on a straight-line basis over the life of the associated long-term customer contracts.

Property, Plant and Equipment

The cost of property classified as “Construction in progress” is excluded from capitalized costs being depreciated.

Equity Method Interests

Unamortized basis differences will be amortized or accreted into equity income of unconsolidated affiliates over the useful lives of the underlying pipeline assets.Capitalized interest is amortized on a straight-line basis into equity income of unconsolidated affiliates.

Debt and Financing Cost

The unamortized debt issuance costs related to the revolving credit facilities were included in the “Deferred charges and other assets” of the Condensed Consolidated Balance Sheets.

Equity and Warrants

Therefore, the Common Unit is accounted for as redeemable noncontrolling interest and classified as temporary equity on the Company’s Condensed Consolidated Balance Sheets.

Fair Value Measurements

As such derivative contracts are classified as Level 2 in the hierarchy.

Derivatives

The fair value or settlement value of the consolidated interest rate swaps outstanding are presented on a gross basis on the Condensed Consolidated Balance Sheets.The Company recorded cash settlements and changes in fair value of the interest rate swap contracts in “Interest expense” of the Condensed Consolidated Statements of Operations.The fair value or settlement value of the swaps outstanding are presented on a gross basis on the Condensed Consolidated Balance SheetsThe Company recorded cash settlements and fair value adjustments on commodity swap derivatives in “Product revenue” of the Consolidated Statements of Operations.

Share-Based Payment Compensation

The fair value of the PSUs is determined using a Monte Carlo simulation at the grant date. The Company recognized compensation expense for PSUs on a straight-line basis over the performance period. Any PSU not earned at the end of the performance period will be forfeited.

Commitments and Contingencies

Accruals for loss contingencies arising from claims, assessments, litigation, environmental and other sources are recorded when it is probable that a liability has been incurred and the amount can be reasonably estimated. These accruals are adjusted as additional information becomes available or circumstances change.

The Company is a party to various legal actions arising in the ordinary course of its business. In accordance with FASB ASC 450, Contingencies, the Company accrues reserves for outstanding lawsuits, claims and proceedings when a loss contingency is probable and can be reasonably estimated. The Company estimates the amount of loss contingencies using current available information from legal proceedings, advice from legal counsel and available insurance coverage. Due to the inherent subjectivity of the assessments and unpredictability of the outcomes of the legal proceedings, any amounts accrued or included in this aggregate amount may not represent the ultimate loss to the Company from the legal proceedings in question. There were no litigation-related accrued reserves as of September 30, 2024 and December 31, 2023.

Upon Closing, the Company evaluated the earn-out consideration classification in accordance with ASC 480. The Company determined the earn-out consideration to be classified as a liability based on the settlement provision.Pursuant to ASC 805, the Company recorded a subsequent fair value adjustment of $1.4 million within “Costs of sales (exclusive of depreciation and amortization)” of the Condensed Consolidated Statement of Operations for the three months ended September 30, 2024.

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BUSINESS COMBINATIONS (Tables)

9 Months Ended

Sep. 30, 2024

Business Combinations [Abstract]

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed

The following table summarizes the estimated fair value of assets acquired and liabilities assumed in the Durango Acquisition as of June 24, 2024, in accordance with ASC 805:

(In thousands)	Amount
Cash and cash equivalents	$	16,785
Accounts receivable	29,386
Prepaid and other current assets	10,000
Property, plant, and equipment, net	471,429
Intangible assets, net	379,000
Deferred charges and other assets	4
Operating lease ROU assets	3,617
Total assets acquired	910,221
Accounts payable	34,314
Accrued expenses	7,140
Contract liabilities	642
Operating lease liabilities	3,617
Deferred tax liabilities	19,340
Total liabilities assumed	65,053
Contingent consideration(1)	64,000
Consideration transferred	$	781,168

(1)Pursuant to ASC 805, the Company evaluated the earn-out consideration classification in accordance with ASC 480, Distinguishing Liabilities from Equity (“ASC 480”). The Company determined the earn-out consideration to be classified as a liability based on the settlement provision. Therefore, the Company records the contingent consideration at fair value as of September 30, 2024. Additional discussion in Note 15—Commitments and Contingencies in the Notes to our Condensed Consolidated Financial Statements set forth in this Form 10-Q.

Schedule of Pro Forma Information

The unaudited supplemental pro forma financial data is for informational purposes only and is not indicative of future results. The results below for the three and nine months ended September 30, 2024 and 2023, respectively, combine the results of the Company and Durango, giving effect to the Durango Acquisition as if it had been completed on January 1, 2023.

	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
	(In thousands)
Revenues	$	396,362	$	410,988	$	1,210,257	$	1,138,419
Net income including noncontrolling interest	$	83,602	$	46,575	$	228,652	$	123,738

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REVENUE RECOGNITION (Tables)

9 Months Ended

Sep. 30, 2024

Revenue from Contract with Customer [Abstract]

Schedule of Disaggregation of Revenue

The following table presents a disaggregation of the Company’s revenue:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
	(In thousands)
Gathering and processing services	$	103,100	$	104,349	$	301,710	$	310,325
Natural gas, NGLs and condensate sales	290,423		221,280		787,092		586,534
Other revenue	2,839		4,672		8,411		10,685
Total revenues	$	396,362	$	330,301	$	1,097,213	$	907,544

Schedule of Remaining Performance Obligation, Expected Timing of Satisfaction

The following table presents our estimated revenue from contracts with customers for remaining performance obligations that have not yet been recognized, representing our contractually committed revenues as of September 30, 2024:

	Amount
Fiscal Year	(In thousands)
Remaining of 2024	$	7,049
2025	71,507
2026	75,387
2027	73,945
2028	72,873
Thereafter	230,750
	$	531,511

Schedule of Contract with Customer, Contract Liability

The following table provides information about contract liabilities from contracts with customers as of September 30, 2024:

	Amount
	(In thousands)
Balance at December 31, 2023	$	32,238
Reclassification of beginning contract liabilities to revenue as a result of performance obligations being satisfied	(5,182)
Cash received in advance and not recognized as revenue	997
Balance at September 30, 2024	28,053
Less: Current portion	6,195
Non-current portion	$	21,858

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PROPERTY, PLANT AND EQUIPMENT (Tables)

9 Months Ended

Sep. 30, 2024

Property, Plant and Equipment [Abstract]

Schedule of Property, Plant and Equipment

Property, plant and equipment, at carrying value, is as follows:

	September 30,		December 31,
	2024		2023
	(In thousands)
Gathering, processing, and transmission systems and facilities	$	3,715,716	$	3,253,539
Vehicles	14,714		11,447
Computers and equipment	7,830		6,242
Less: accumulated depreciation	(759,280)		(626,223)
Total depreciable assets, net	2,978,980		2,645,005
Construction in progress	217,637		74,369
Land	30,267		23,853
Total property, plant, and equipment, net	$	3,226,884	$	2,743,227

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INTANGIBLE ASSETS, NET (Tables)

9 Months Ended

Sep. 30, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Finite-Lived Intangible Assets

Intangible assets, net, are comprised of the following:

	September 30,		December 31,
	2024		2023
	(In thousands)
Customer contracts	$	1,460,287	$	1,139,665
Right of way assets	199,129		141,711
Less accumulated amortization	(781,275)		(689,706)
Total amortizable intangible assets, net	$	878,141	$	591,670

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EQUITY METHOD INVESTMENTS (Tables)

9 Months Ended

Sep. 30, 2024

Equity Method Investments and Joint Ventures [Abstract]

Schedule of Equity Method Investments

As of September 30, 2024, the Company owned investments in the following long-haul pipeline entities in the Permian Basin. These investments were accounted for using the equity method of accounting. For each EMI pipeline entity, the Company has the ability to exercise significant influence based on certain governance provisions and its participation in the significant activities and decisions that impact the management and economic performance of the EMI pipeline. The table below presents the ownership percentages and investment balances held by the Company for each entity:

		September 30,		December 31,
	Ownership(1)	2024		2023
		(In thousands)
PHP	55.5%	$	1,623,127	$	1,666,254
Breviloba	33.0%	433,193		443,684
Epic Crude Holdings, LP (“EPIC”)(1)	27.5%	85,627		—
Gulf Coast Express Pipeline LLC (“GCX”)(2)	—%	—		431,051
		$	2,141,947	$	2,540,989

(1)Investment balance is primarily comprised of the additional 12.5% interest that was acquired during July 2024.

(2)The Company owned 16% of GCX as of December 31, 2023 and divested entire ownership in June 2024.

The following table presents the activity in the Company’s EMIs for the nine months ended September 30, 2024:

	Permian Highway Pipeline LLC		Breviloba, LLC		EPIC Crude Holdings, LP		Gulf Coast Express Pipeline LLC		Total
	(In thousands)
Balance at December 31, 2023	$	1,666,254	$	443,684	$	—	$	431,051	$	2,540,989
Contributions and acquisitions	3,273		—		85,417		—		88,690
Distributions(1)	(177,172)		(33,677)		—		(15,610)		(226,459)
Disposition	—		—		—		(430,941)		(430,941)
Equity income, net(2)	130,772		23,186		210		15,500		169,668
Balance at September 30, 2024	$	1,623,127	$	433,193	$	85,627	$	—	$	2,141,947

(1)Distributions consisted of distributions from a return on investment of $223.7 million, which was included in cash flows from operating activities and distributions from a return of investment of $2.8 million, which was included in cash flows from investing activities.

(2)For the nine months ended September 30, 2024, net of amortization and accretion of basis differences and capitalized interests, which represents undistributed earnings, the amortization was $5.9 million from PHP, $0.5 million from Breviloba, LLC, $2.7 million from GCX and accretion of $1.6 million from EPIC.

Schedule of Equity Method Investment, Summarized Financial Information

The following table represents selected data for the Company’s ongoing EMI pipelines (on a 100 percent basis) for the three and nine months ended September 30, 2024 and 2023.

	Three Months Ended September 30,
	2024						2023
	Permian Highway Pipeline LLC		Breviloba, LLC		EPIC Crude Holdings, LP		Permian Highway Pipeline LLC		Breviloba, LLC		EPIC Crude Holdings, LP
	(In thousands)
Revenues	$	127,719	$	53,929	$	97,514	$	99,923	$	51,002	$	93,138
Operating income	83,785		27,398		25,052		65,549		25,170		22,521
Net income (loss)	83,783		27,558		(5,159)		66,630		25,223		(11,330)

	Nine Months Ended September 30,
	2024						2023
	Permian Highway Pipeline LLC		Breviloba, LLC		EPIC Crude Holdings, LP		Permian Highway Pipeline LLC		Breviloba, LLC		EPIC Crude Holdings, LP
	(In thousands)
Revenues	$	380,359	$	156,326	$	284,050	$	291,859	$	143,544	$	259,250
Operating income	245,467		74,563		70,631		185,862		69,666		36,148
Net income (loss)	245,016		75,005		(29,889)		190,662		70,086		(62,312)

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DEBT AND FINANCING COSTS - (Tables)

9 Months Ended

Sep. 30, 2024

Debt Disclosure [Abstract]

Schedule of Long-term Debt

The following table summarizes the Company’s debt obligations as of September 30, 2024 and December 31, 2023:

	September 30,		December 31,
	2024		2023
	(In thousands)
A/R Facility	$	150,000	$	—
Total current debt obligations	$	150,000	$	—
Unsecured term loan	$	1,000,000	$	1,200,000
5.875% senior unsecured notes due 2030 (“2030 Notes”)	1,000,000		1,000,000
6.625% senior unsecured notes due 2028 (“2028 Notes”)	800,000		800,000
$1.25 billion revolving line of credit	507,000		594,000
Total long-term debt	3,307,000		3,594,000
Debt issuance costs, net(1)	(27,432)		(31,510)
Unamortized debt premiums and discounts, net	121		319
Total long-term debt, net	$	3,279,689	$	3,562,809

(1)Excludes unamortized debt issuance costs related to the revolving line of credit. Unamortized debt issuance costs associated with the revolving line of credit were $4.2 million and $5.4 million as of September 30, 2024 and December 31, 2023, respectively. The unamortized debt issuance costs related to the revolving credit facilities were included in the “Deferred charges and other assets” of the Condensed Consolidated Balance Sheets.

Schedule of Financing Costs, Net

The table below presents the components of the Company’s financing costs, net of capitalized interest:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
	(In thousands)
Capitalized interest	$	(2,955)	$	(6,731)	$	(4,885)	$	(13,775)
Debt issuance costs	1,916		1,546		5,497		4,601
Interest expense	67,068		50,194		166,933		139,617
Total financing costs, net of capitalized interest	$	66,029	$	45,009	$	167,545	$	130,443

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ACCRUED EXPENSES (Tables)

9 Months Ended

Sep. 30, 2024

Payables and Accruals [Abstract]

Schedule of Accrued Expenses

The following table provides detail of the Company’s current accrued expenses on September 30, 2024 and December 31, 2023:

	September 30,		December 31,
	2024		2023
	(In thousands)
Accrued product purchases	$	97,635	$	109,172
Accrued taxes	20,270		632
Accrued salaries, vacation, and related benefits	5,349		1,872
Accrued capital expenditures	13,911		18,534
Accrued interest	34,070		33,760
Accrued other expenses	20,554		13,451
Total accrued expenses	$	191,789	$	177,421

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FAIR VALUE MEASUREMENTS (Tables)

9 Months Ended

Sep. 30, 2024

Fair Value Disclosures [Abstract]

Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis

The following tables present financial assets and liabilities that are measured at fair value on a recurring basis as of September 30, 2024 and December 31, 2023:

	September 30, 2024
	Level 1		Level 2		Level 3		Total
	(In thousands)
Commodity swap	$	—	$	7,785	$	—	$	7,785
Interest rate derivatives	—		84		—		84
Total assets	$	—	$	7,869	$	—	$	7,869
Commodity swaps	$	—	$	3,936	$	—	$	3,936
Interest rate derivatives	—		3,888		—		3,888
Contingent liability	—		—		65,400		65,400
Total liabilities	$	—	$	7,824	$	65,400	$	73,224

	December 31, 2023
	Level 1		Level 2		Level 3		Total
	(In thousands)
Commodity swap	$	—	$	3,663	$	—	$	3,663
Interest rate derivatives	—		4,314		—		4,314
Total assets	$	—	$	7,977	$	—	$	7,977
Commodity swaps	$	—	$	1,749	$	—	$	1,749
Interest rate derivatives	—		5,348		—		5,348
Total liabilities	$	—	$	7,097	$	—	$	7,097

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DERIVATIVES AND HEDGING ACTIVITIES (Tables)

9 Months Ended

Sep. 30, 2024

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Derivative Instruments in Statement of Financial Position, Fair Value

The following table presents the fair value of derivative assets and liabilities related to the interest rate swap contracts:

	September 30,		December 31,
	2024		2023
	(In thousands)
Derivatives assets - current	$	76	$	4,314
Derivative assets - noncurrent	8		—
Total derivative assets	$	84	$	4,314
Derivative liabilities - current	$	3,888	$	—
Derivatives liabilities - noncurrent	—		5,348
Total derivative liabilities	$	3,888	$	5,348

The following table presents interest rate swap derivatives activities for the three and nine months ended September 30, 2024 and 2023:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
	(In thousands)
Realized gain on interest rate swaps	$	3,994	$	4,665	$	11,899	$	7,082
(Unfavorable) favorable fair value adjustment	$	(8,342)	$	12,500	$	9,129	$	34,562

The following table presents the fair value of derivative assets and liabilities related to commodity swaps:

	September 30,		December 31,
	2024		2023
	(In thousands)
Derivatives assets - current	$	6,200	$	3,498
Derivative assets - noncurrent	1,585		165
Total derivative assets	$	7,785	$	3,663
Derivative liabilities - current	$	2,855	$	1,734
Derivatives liabilities - noncurrent	1,081		15
Total derivative liabilities	$	3,936	$	1,749

The following table presents commodity swap derivatives activities for the three and nine months ended September 30, 2024 and 2023:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
	(In thousands)
Realized (loss) gain on commodity swaps	$	(2,790)	$	176	$	(20,002)	$	8,029
Favorable (unfavorable) fair value adjustment	$	6,027	$	(8,083)	$	(18,067)	$	6,466

Schedule of Detail Information of Commodity Swaps Outstanding

The following table presents detailed information of commodity swaps outstanding as of September 30, 2024 (in thousands, except volumes):

	September 30, 2024
Commodity	Unit	Notional Volume	Net Fair Value
Natural Gas	MMBtus	1,210,000	$	569
NGL	Gallons	312,215,400	917
Crude	Bbl	613,000	2,563
Crude Collars	Bbl	163,800	937
Crude Basis Spread Swaps	Bbl	22,400	(9)
Natural Gas Basis Spread Swaps	MMBtus	7,300,000	(1,128)
			$	3,849

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SHARE-BASED COMPENSATION (Tables)

9 Months Ended

Sep. 30, 2024

Share-Based Payment Arrangement [Abstract]

Share-Based Payment Arrangement, Outstanding Award, Activity, Excluding Option

The table below summarizes Class A Share and Class C Share activities for the nine months ended September 30, 2024:

	Number of Shares	Weighted Avg Grant-Date Fair Market Value Per Unit
Outstanding and unvested shares at December 31, 2023	5,444,488	$	28.91
Vested	43,166	31.18
Forfeited	1,592	31.18
Outstanding and unvested shares at September 30, 2024	5,399,730	$	28.90

Schedule of Share-Based Compensation Arrangement by Share-Based Payment Award, Options Than Options, Grants in Period, Grant Date Intrinsic Value

Table below summarizes aggregate intrinsic value (market value at vesting date) and grant-date fair value of vested Class A Shares for the nine months ended September 30, 2024:

	Three Months Ended		Nine Months Ended
	September 30, 2024		September 30, 2024
	(In thousands)
Aggregate intrinsic value of vested Class A Shares	$	1,102	$	1,756
Grant-date fair value of vested Class A Shares	$	834	$	1,346

Schedule of Nonvested Restricted Stock Shares Activity

The table below summarizes RSUs activities for the nine months ended September 30, 2024:

	Number of Shares(1)	Weighted Avg Grant-Date Fair Market Value Per Unit(1)
Outstanding and unvested shares at December 31, 2023	435,220	$	31.15
Granted	610,333	35.41
Vested	323,158	34.79
Forfeited	12,565	33.06
Outstanding and unvested shares at September 30, 2024	709,830	$	33.12

(1)The number of shares and weighted average fair market value per share include RSUs issued to new employees that transitioned from ALTM as part of the merger as replacement awards.

Schedule of Share-Based Payment Arrangement, Restricted Stock and Restricted Stock Unit, Activity

Table below summarizes aggregate intrinsic value (market value at vesting date) and grant-date fair value of RSUs for the three and nine months ended September 30, 2024 and 2023.

	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
	(In thousands)
Aggregate intrinsic value of vested RSUs	$	387	$	34	$	11,469	$	7,340
Grant-date fair value of vested RSUs	$	372	$	35	$	11,243	$	6,827

Schedule of Share-Based Payment Arrangement, Performance Shares, Activity

The table below summarizes PSU activities for the nine months ended September 30, 2024:

	Number of Shares	Weighted Avg Grant-Date Fair Market Value Per Unit
Granted in 2024	198,703	$	36.76
Outstanding and unvested shares at September 30, 2024	198,703	$	36.76

Schedule of Share-Based Payment Award, Other Than Options, Valuation Assumptions

The table below presents a summary of the grant-date fair value assumptions used to value the PSUs on grant date:

	March 2024
Grant-date fair value per unit	$36.76
Beginning average price	$32.84
Risk-free interest rate	4.21%
Volatility factor	37%
Expected term	2.82 years

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INCOME TAXES (Tables)

9 Months Ended

Sep. 30, 2024

Income Tax Disclosure [Abstract]

Schedule of Total Income Tax Provision (Benefit)

The Company is subject to U.S. federal income tax and state taxes. Income tax expense included in the condensed consolidated financial statements in this Quarterly Report on Form 10-Q is as follows:

	Three Months Ended September 30,						Nine Months Ended September 30,
	2024			2023			2024			2023
	(In thousands)
Income before income taxes	$	91,914		$	44,434		$	249,270		$	121,128
Income tax expense	$	8,260		$	1,303		$	21,261		$	2,030
Effective tax rate	8.99		%	2.93		%	8.53		%	1.68		%

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NET INCOME PER SHARE (Tables)

9 Months Ended

Sep. 30, 2024

Earnings Per Share [Abstract]

Schedule of Net Income Per Share

The computation of basic and diluted net income per share for the periods presented in the condensed consolidated financial statements is shown in the tables below:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
	(In thousands, except per share amounts)
Net income attributable to Class A common shareholders	$	25,763	$	15,580	$	74,505	$	42,030
Less: Net income available to participating unvested restricted Class A common shareholders(1)	(4,755)		(4,414)		(13,636)		(12,996)
Total net income attributable to Class A common shareholders	$	21,008	$	11,166	$	60,869	$	29,034
Weighted average shares outstanding - basic	59,811		53,340		59,116		50,464
Dilutive effect of unvested Class A common shares(2)	613		123		736		255
Weighted average shares outstanding - diluted(2)(3)	60,424		53,463		59,852		50,719
Net income available per common share - basic	$	0.35	$	0.21	$	1.03	$	0.58
Net income available per common share - diluted	$	0.35	$	0.21	$	1.02	$	0.57

(1)Represents dividends paid to unvested Class A and Class C Shares, RSUs and PSUs.

(2)Includes dilutive effect from both RSUs and PSUs on unvested Class A common shares.

(3)The effect of an assumed exchange of outstanding Common Units (and the cancellation of a corresponding number of shares of outstanding Class C Common Stock) would have been anti-dilutive for all periods presented in which the Common Units were outstanding.

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SEGMENTS (Tables)

9 Months Ended

Sep. 30, 2024

Segment Reporting [Abstract]

Schedule of Segment Reporting Information, by Segment

The following tables present the reconciliation of the non-GAAP measure Segment Adjusted EBITDA to the GAAP measure segment income (loss) before income taxes as of and for the three and nine months period ended September 30, 2024 and 2023:

	Midstream Logistics		Pipeline Transportation		Corporate and Other(1)		Consolidated
	(In thousands)
For the Three Months Ended September 30, 2024
Segment income (loss) before income taxes	$	88,581	$	88,797	$	(85,464)	$	91,914
Add back:
Interest expense	2,666		—		63,363		66,029
Depreciation and amortization expenses	85,273		2,305		5		87,583
Contract assets amortization	1,655		—		—		1,655
Proportionate EMI EBITDA	—		88,229		—		88,229
Share-based compensation	—		—		15,171		15,171
Contingent liabilities fair value adjustment	1,400		—		—		1,400
Integration costs	1,208		—		1,332		2,540
Acquisition transaction costs	—		—		31		31
Other one-time costs or amortization	1,657		—		2,060		3,717
Deduct:
Interest income	—		—		572		572
Commodity hedging unrealized gain	8,817		—		—		8,817
Gain on sale of equity method investment	—		29,953		—		29,953
Equity income from unconsolidated affiliates	—		53,244		—		53,244
Segment Adjusted EBITDA(2)	$	173,623	$	96,134	$	(4,074)	$	265,683

	Midstream Logistics		Pipeline Transportation		Corporate and Other(1)		Consolidated
	(In thousands)
For the Three Months Ended September 30, 2023
Segment income (loss) before income taxes	$	56,584	$	50,598	$	(62,748)	$	44,434
Add back:
Interest expense	12		—		44,997		45,009
Depreciation and amortization expenses	69,456		473		6		69,935
Contract assets amortization	1,655		—		—		1,655
Proportionate EMI EBITDA	—		78,585		—		78,585
Share-based compensation	—		—		12,502		12,502
Loss on disposal of assets	2,927		—		—		2,927
Unrealized loss on derivatives	8,259		—		—		8,259
Integration costs	21		—		—		21
Acquisition transaction costs	—		—		378		378
Other one-time costs or amortization	1,529		—		1,133		2,662
Warrant valuation adjustment	—		—		4		4
Deduct:
Interest income	—		—		293		293
Equity income from unconsolidated affiliates	—		50,754		—		50,754
Segment Adjusted EBITDA(2)	$	140,443	$	78,902	$	(4,021)	$	215,324

	Midstream Logistics		Pipeline Transportation		Corporate and Other(1)		Consolidated
	(In thousands)
For the Nine Months Ended September 30, 2024
Segment income (loss) before income taxes	$	215,196	$	275,246	$	(241,172)	$	249,270
Add back:
Interest expense	5,273		—		162,272		167,545
Depreciation and amortization expenses	229,336		6,897		17		236,250
Contract assets amortization	4,965		—		—		4,965
Proportionate EMI EBITDA	—		262,553		—		262,553
Share-based compensation	—		—		52,868		52,868
Loss on disposal of assets	4,090		—		—		4,090
Loss on debt extinguishment	—		—		525		525
Contingent liabilities fair value adjustment	1,400		—		—		1,400
Integration costs	1,792		—		3,299		5,091
Acquisition transaction costs	—		—		3,538		3,538
Other one-time costs or amortization	4,048		—		4,400		8,448
Deduct
Other interest income	—		—		1,459		1,459
Commodity hedging unrealized gain	1,935		—		—		1,935
Gain on sale of equity method investment	—		89,837		—		89,837
Equity income from unconsolidated affiliates	—		169,668		—		169,668
Segment Adjusted EBITDA(2)	$	464,165	$	285,191	$	(15,712)	$	733,644

	Midstream Logistics		Pipeline Transportation		Corporate and Other(1)		Consolidated
	(In thousands)
For the Nine Months Ended September 30, 2023
Segment income (loss) before income taxes	$	163,794	$	146,524	$	(189,190)	$	121,128
Add back:
Interest expense	32		—		130,411		130,443
Depreciation and amortization expenses	206,855		1,398		18		208,271
Contract assets amortization	4,965		—		—		4,965
Proportionate EMI EBITDA	—		224,933		—		224,933
Share-based compensation	—		—		43,340		43,340
Loss on disposal of assets	15,166		—		—		15,166
Unrealized loss on derivatives	616		—		—		616
Integration costs	29		—		956		985
Acquisition transaction costs	33		—		615		648
Other one-time costs or amortization	5,310		—		2,235		7,545
Deduct:
Interest income	—		—		314		314
Warrant valuation adjustment	—		—		73		73
Equity income from unconsolidated affiliates	—		146,828		—		146,828
Segment Adjusted EBITDA(2)	$	396,800	$	226,027	$	(12,002)	$	610,825

(1)Corporate and Other represents those results that: (i) are not specifically attributable to a reportable segment; (ii) are not individually reportable or (iii) have not been allocated to a reportable segment for the purpose of evaluating their performance, including certain General and Administrative Expense items. Items included here to reconcile operating segments profit and loss with the Company’s consolidated profit and loss.

(2)Segment adjusted EBITDA is a non-GAAP measure; please see Key Performance Metrics in “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations” in this Quarterly Report on Form 10-Q, for a definition and reconciliation to the GAAP measure.

The following tables present the revenue for the individual operating segments for the three and nine month period ended September 30, 2024 and 2023:

	Midstream Logistics		Pipeline Transportation		Elimination		Consolidated
	(In thousands)
For the Three Months Ended September 30, 2024
Revenue	$	391,331	$	2,192	$	—	$	393,523
Other revenue	2,837		2		—		2,839
Intersegment revenue(1)	—		6,748		(6,748)		—
Total segment operating revenue	$	394,168	$	8,942	$	(6,748)	$	396,362

	Midstream Logistics		Pipeline Transportation		Elimination		Consolidated
	(In thousands)
For the Three Months Ended September 30, 2023
Revenue	$	324,863	$	766	$	—	$	325,629
Other revenue	4,670		2		—		4,672
Total segment operating revenue	$	329,533	$	768	$	—	$	330,301

	Midstream Logistics		Pipeline Transportation		Elimination		Consolidated
	(In thousands)
For the Nine Months Ended September 30, 2024
Revenue	$	1,082,236	$	6,566	$	—	$	1,088,802
Other revenue	8,122		289		—		8,411
Intersegment revenue(1)	—		19,288		(19,288)		—
Total segment operating revenue	$	1,090,358	$	26,143	$	(19,288)	$	1,097,213

	Midstream Logistics		Pipeline Transportation		Elimination		Consolidated
	(In thousands)
For the Nine Months Ended September 30, 2023
Revenue	$	894,669	$	2,190	$	—	$	896,859
Other revenue	10,679		6		—		10,685
Total segment operating revenue	$	905,348	$	2,196	$	—	$	907,544

(1)The Company accounts for intersegment sales at market prices, while it accounts for asset transfers at book value. Intersegment revenue is eliminated at consolidation.

The following table presents total assets for each operating segment as of September 30, 2024 and December 31, 2023:

	September 30,		December 31,
	2024		2023
	(In thousands)
Midstream Logistics	$	4,323,444	$	3,772,764
Pipeline Transportation(1)	2,297,544		2,703,588
Segment total assets	6,620,988		6,476,352
Corporate and other	239,473		20,521
Total assets	$	6,860,461	$	6,496,873

(1)Includes investment in unconsolidated affiliates of $2.14 billion and $2.54 billion as of September 30, 2024 and December 31, 2023, respectively.

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DESCRIPTION OF THE ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details)		3 Months Ended			9 Months Ended
		Sep. 30, 2024 USD ($) entity	Mar. 18, 2024 USD ($)	Sep. 30, 2023 USD ($)	Sep. 30, 2024 USD ($) entity	Sep. 30, 2023 USD ($)	Dec. 31, 2023
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Interest in pipeline entities | entity		3			3
Revenue		$ 396,362,000		$ 330,301,000	$ 1,097,213,000	$ 907,544,000
Costs of sales (exclusive of depreciation and amortization)	[1],[2]	144,586,000		147,756,000	444,786,000	374,100,000
Related Party
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Revenue		0		20,000,000.0	17,200,000	70,900,000
Costs of sales (exclusive of depreciation and amortization)		12,800,000		15,500,000	48,700,000	50,600,000
Related Party | Highway Pipeline LLC and Breviloba, LLC
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Costs of sales (exclusive of depreciation and amortization)		$ 12,800,000		2,400,000	$ 39,300,000	6,400,000
Related Party | Apache Midstream and Titus
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Revenue			$ 17,200,000	20,000,000.0		70,900,000
Costs of sales (exclusive of depreciation and amortization)			9,400,000	13,100,000		44,200,000
Operating expenses			$ 200,000	$ 100,000		$ 500,000
Related Party | Maximum | Apache
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Common stock, share outstanding, ownership percentage			0.00%				10.00%
Related Party | Common Stock
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Ownership percentage		5.00%			5.00%
Kinetik Holdings LP
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Limited partners, ownership interest					38.00%

[1] Cost of sales (exclusive of depreciation and amortization) is net of gas service revenues totaling $60.2 million and $38.6 million for the three months ended September 30, 2024 and 2023, respectively, and $159.4 million and $107.1 million for the nine months ended September 30, 2024 and 2023, respectively, for certain volumes where we act as principal.

[2] Includes amounts associated with related parties of $12.8 million and $15.5 million for the three months ended September 30, 2024 and 2023, respectively, and $48.7 million and $50.6 million for the nine months ended September 30, 2024 and 2023, respectively

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BUSINESS COMBINATIONS - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands, shares in Millions		3 Months Ended			6 Months Ended	9 Months Ended
	Jun. 24, 2024	Sep. 30, 2024	Sep. 30, 2024	Sep. 30, 2023	Jun. 30, 2023	Sep. 30, 2024	Sep. 30, 2023	Dec. 31, 2023	Mar. 13, 2023
Business Acquisition [Line Items]
Acquisition transaction costs		$ 31		$ 378
Goodwill		$ 5,077	$ 5,077			$ 5,077		$ 5,077
Right of way assets
Business Acquisition [Line Items]
Intangible asset useful life		10 years	10 years			10 years
Total amortizable intangible assets, gross		$ 199,129	$ 199,129			$ 199,129		$ 141,711
Class C Common Stock
Business Acquisition [Line Items]
Common stock, par value (in USD per share)		$ 0.0001	$ 0.0001			$ 0.0001		$ 0.0001
Durango Permian LLC Acquisition
Business Acquisition [Line Items]
Purchase price	$ 845,200
Cash consideration paid	358,000					$ 357,968	$ 0
Contingent consideration	64,000
Working capital adjustment		$ 21,000
Adjustment related to long-lived assets and intangible assets		(10,600)
Decrease in goodwill		10,400
Acquisition transaction costs							3,500
Revenues		35,800				38,900
Net income		1,400				1,600
Acquisition related expense adjustment						3,500
Interest expense removed				$ 3,900		24,000	$ 11,100
Assets acquired	$ 910,221
Durango Permian LLC Acquisition | General and Administrative Expense
Business Acquisition [Line Items]
Acquisition transaction costs						3,200
Durango Permian LLC Acquisition | Minimum
Business Acquisition [Line Items]
Facilities and equipment useful life	5 years
Intangible asset useful life	7 years
Durango Permian LLC Acquisition | Maximum
Business Acquisition [Line Items]
Facilities and equipment useful life	30 years
Intangible asset useful life	12 years
Durango Permian LLC Acquisition | Kinetik LP
Business Acquisition [Line Items]
Contingent consideration	$ 75,000	$ 65,400	$ 65,400			$ 65,400
Durango Permian LLC Acquisition | Class C Common Stock
Business Acquisition [Line Items]
Equity interest issuable (in shares)	3.8
Equity interest issuable value	$ 148,200
Durango Permian LLC Acquisition | Class C Common Stock | To Be Issued On July 1, 2025
Business Acquisition [Line Items]
Equity interest issuable (in shares)	7.7		7.7
Equity interest issuable value	$ 275,000
Midstream Infrastructure Assets and Incentive and Acceleration Agreement
Business Acquisition [Line Items]
Assets acquired					$ 65,000
Agreement term					20 years
Incentive and acceleration agreement									$ 60,000
Midstream Infrastructure Assets and Incentive and Acceleration Agreement | Prepaid Expenses and Other Current Assets
Business Acquisition [Line Items]
Prepaid and other current assets									4,700
Midstream Infrastructure Assets and Incentive and Acceleration Agreement | Deferred Charges and Other Assets
Business Acquisition [Line Items]
Other noncurrent assets									$ 55,300
Midstream Infrastructure Assets and Incentive and Acceleration Agreement | Right of way assets
Business Acquisition [Line Items]
Total amortizable intangible assets, gross					$ 3,100
Midstream Infrastructure Assets and Incentive and Acceleration Agreement | Gathering And Disposal Assets
Business Acquisition [Line Items]
Assets acquired					$ 61,900

XML

BUSINESS COMBINATIONS - Allocation of Acquisition Costs to Assets Acquired and Liabilities Assumed (Details) - Durango Permian LLC Acquisition $ in Thousands	Jun. 24, 2024 USD ($)
Business Acquisition [Line Items]
Cash and cash equivalents	$ 16,785
Accounts receivable	29,386
Prepaid and other current assets	10,000
Property, plant, and equipment, net	471,429
Intangible assets, net	379,000
Operating lease ROU assets	3,617
Total assets acquired	910,221
Accounts payable	34,314
Accrued expenses	7,140
Contract liabilities	642
Operating lease liabilities	3,617
Deferred tax liabilities	19,340
Total liabilities assumed	65,053
Contingent consideration	64,000
Consideration transferred	781,168
Deferred Charges and Other Assets
Business Acquisition [Line Items]
Deferred charges and other assets	$ 4

XML

BUSINESS COMBINATIONS -Schedule of Pro Forma Information (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract]
Revenues	$ 396,362	$ 410,988	$ 1,210,257	$ 1,138,419
Net income including noncontrolling interest	$ 83,602	$ 46,575	$ 228,652	$ 123,738

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REVENUE RECOGNITION - Disaggregation of Revenue (Details) - USD ($) $ in Thousands		3 Months Ended		9 Months Ended
		Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Disaggregation of Revenue [Line Items]
Total revenues	[1]	$ 396,362	$ 330,301	$ 1,097,213	$ 907,544
Gathering and processing services
Disaggregation of Revenue [Line Items]
Total revenues		103,100	104,349	301,710	310,325
Natural gas, NGLs and condensate sales
Disaggregation of Revenue [Line Items]
Total revenues		290,423	221,280	787,092	586,534
Other revenue
Disaggregation of Revenue [Line Items]
Total revenues		$ 2,839	$ 4,672	$ 8,411	$ 10,685

[1] Includes amounts associated with related parties of nil and $20.0 million for the three months ended September 30, 2024 and 2023, respectively, and $17.2 million and $70.9 million for the nine months ended September 30, 2024 and 2023, respectively.

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REVENUE RECOGNITION - Additional Information (Details) - USD ($)		3 Months Ended		9 Months Ended
		Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023	Dec. 31, 2023
Disaggregation of Revenue [Line Items]
Total revenues	[1]	$ 396,362,000	$ 330,301,000	$ 1,097,213,000	$ 907,544,000
Capitalized contract cost		66,200,000		66,200,000		$ 71,200,000
Amortization of contract costs		1,655,000	1,655,000	4,965,000	4,965,000
Minimum Volume Commitments
Disaggregation of Revenue [Line Items]
Total revenues		$ 0	$ 400,000	$ 0	$ 1,600,000

[1] Includes amounts associated with related parties of nil and $20.0 million for the three months ended September 30, 2024 and 2023, respectively, and $17.2 million and $70.9 million for the nine months ended September 30, 2024 and 2023, respectively.

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REVENUE RECOGNITION - Remaining Performance Obligations (Details) $ in Thousands	Sep. 30, 2024 USD ($)
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligations	$ 531,511
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-10-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligations	$ 7,049
Expected timing of satisfaction, period	9 months
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligations	$ 71,507
Expected timing of satisfaction, period	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2026-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligations	$ 75,387
Expected timing of satisfaction, period	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2027-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligations	$ 73,945
Expected timing of satisfaction, period	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2028-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligations	$ 72,873
Expected timing of satisfaction, period	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2029-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligations	$ 230,750
Expected timing of satisfaction, period

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REVENUE RECOGNITION - Contract Liabilities (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2024	Dec. 31, 2023
Contract with Customer, Liability [Roll Forward]
Beginning balance	$ 32,238
Reclassification of beginning contract liabilities to revenue as a result of performance obligations being satisfied	(5,182)
Cash received in advance and not recognized as revenue	997
Ending balance	28,053
Less: Current portion	6,195
Non-current portion	$ 21,858	$ 25,761

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PROPERTY, PLANT AND EQUIPMENT (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023	Dec. 31, 2023
Property, Plant and Equipment [Line Items]
Less: accumulated depreciation	$ (759,280,000)		$ (759,280,000)		$ (626,223,000)
Total depreciable assets, net	2,978,980,000		2,978,980,000		2,645,005,000
Total property, plant, and equipment, net	3,226,884,000		3,226,884,000		2,743,227,000
Depreciation expense	48,700,000	$ 39,400,000	135,300,000	$ 116,600,000
Impairment of long-lived assets	0	$ 0	0	$ 0
Gathering, processing, and transmission systems and facilities
Property, Plant and Equipment [Line Items]
Total property, plant and equipment, gross	3,715,716,000		3,715,716,000		3,253,539,000
Vehicles
Property, Plant and Equipment [Line Items]
Total property, plant and equipment, gross	14,714,000		14,714,000		11,447,000
Computers and equipment
Property, Plant and Equipment [Line Items]
Total property, plant and equipment, gross	7,830,000		7,830,000		6,242,000
Construction in progress
Property, Plant and Equipment [Line Items]
Total property, plant and equipment, gross	217,637,000		217,637,000		74,369,000
Land
Property, Plant and Equipment [Line Items]
Total property, plant and equipment, gross	$ 30,267,000		$ 30,267,000		$ 23,853,000

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INTANGIBLE ASSETS, NET - Intangible Asset (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Finite-Lived Intangible Assets [Line Items]
Less accumulated amortization	$ (781,275)	$ (689,706)
Total amortizable intangible assets, net	878,141	591,670
Customer contracts
Finite-Lived Intangible Assets [Line Items]
Total amortizable intangible assets, gross	1,460,287	1,139,665
Right of way assets
Finite-Lived Intangible Assets [Line Items]
Total amortizable intangible assets, gross	$ 199,129	$ 141,711

XML

INTANGIBLE ASSETS, NET - Additional Information (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Finite-Lived Intangible Assets [Line Items]
Initial term			10 years
Option to renewal			10 years
Percent of original consideration paid	130.00%		130.00%
Remaining weighted average amortization period	8 years 8 months 8 days		8 years 8 months 8 days
Amortization of intangible assets	$ 38,900,000	$ 30,600,000	$ 100,900,000	$ 91,600,000
Impairment of intangible assets	$ 0	$ 0	$ 0	$ 0
Right of way assets
Finite-Lived Intangible Assets [Line Items]
Useful life	10 years		10 years
Remaining weighted average amortization period	6 years 8 months 1 day		6 years 8 months 1 day
Customer Contracts
Finite-Lived Intangible Assets [Line Items]
Remaining weighted average amortization period	9 years 10 days		9 years 10 days
Minimum
Finite-Lived Intangible Assets [Line Items]
Remaining term			1 year
Maximum
Finite-Lived Intangible Assets [Line Items]
Remaining term			17 years

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EQUITY METHOD INVESTMENTS - Information of Equity Method Investments (Details) - USD ($) $ in Thousands		3 Months Ended		9 Months Ended
	Jun. 04, 2024	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023	Jul. 31, 2024	Jul. 26, 2024	Dec. 31, 2023
Schedule of Equity Method Investments [Line Items]
Equity method interests		$ 2,141,947		$ 2,141,947				$ 2,540,989
Difference between carrying amount and underlying equity		365,700		365,700				349,300
Capitalized interest		24,100		24,100				24,700
Movement In Equity Method Interests [Roll Forward]
Beginning balance				2,540,989
Contributions and acquisitions				88,690
Distributions				(226,459)
Disposition				(430,941)
Equity income, net		53,244	$ 50,754	169,668	$ 146,828
Ending balance		$ 2,141,947		2,141,947
Proceeds from equity method investment, distribution				223,700
Proceeds from equity method investment, distribution, return of capital				2,800
Disposed of by Sale | Gulf Coast Express Pipeline LLC
Schedule of Equity Method Investments [Line Items]
Percentage of equity interest sold	16.00%
Consideration	$ 524,400
Recognized gain				$ 89,800
Disposed of by Sale | Gulf Coast Express Pipeline LLC | Earn Out On Cash Upon Certain Criteria
Schedule of Equity Method Investments [Line Items]
Consideration	$ 30,000
Permian Highway Pipeline LLC
Schedule of Equity Method Investments [Line Items]
Ownership percentage		55.50%		55.50%
Equity method interests		$ 1,623,127		$ 1,623,127				1,666,254
Movement In Equity Method Interests [Roll Forward]
Beginning balance				1,666,254
Contributions and acquisitions				3,273
Distributions				(177,172)
Disposition				0
Equity income, net				130,772
Ending balance		$ 1,623,127		1,623,127
Amortization and accretion				$ 5,900
Breviloba, LLC
Schedule of Equity Method Investments [Line Items]
Ownership percentage		33.00%		33.00%
Equity method interests		$ 433,193		$ 433,193				443,684
Movement In Equity Method Interests [Roll Forward]
Beginning balance				443,684
Contributions and acquisitions				0
Distributions				(33,677)
Disposition				0
Equity income, net				23,186
Ending balance		$ 433,193		433,193
Amortization and accretion				$ 500
EPIC Crude Holdings, LP
Schedule of Equity Method Investments [Line Items]
Ownership percentage		27.50%		27.50%
Equity method interests		$ 85,627		$ 85,627				$ 0
Equity interest acquired percentage						12.50%	12.50%
Movement In Equity Method Interests [Roll Forward]
Beginning balance				0
Contributions and acquisitions				85,417
Distributions				0
Disposition				0
Equity income, net				210
Ending balance		$ 85,627		85,627
Amortization and accretion				$ 1,600
Gulf Coast Express Pipeline LLC
Schedule of Equity Method Investments [Line Items]
Ownership percentage		0.00%		0.00%				16.00%
Equity method interests		$ 0		$ 0				$ 431,051
Movement In Equity Method Interests [Roll Forward]
Beginning balance				431,051
Contributions and acquisitions				0
Distributions				(15,610)
Disposition				(430,941)
Equity income, net				15,500
Ending balance		$ 0		0
Amortization and accretion				$ 2,700

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EQUITY METHOD INVESTMENTS - Summarized Financial Information of Equity Method Investments (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Schedule of Equity Method Investments [Line Items]
Operating income	$ 72,874	$ 38,400	$ 155,563	$ 103,118
Net income (loss)	83,654	43,131	228,009	119,098
Permian Highway Pipeline LLC
Schedule of Equity Method Investments [Line Items]
Revenues	127,719	99,923	380,359	291,859
Operating income	83,785	65,549	245,467	185,862
Net income (loss)	83,783	66,630	245,016	190,662
Breviloba, LLC
Schedule of Equity Method Investments [Line Items]
Revenues	53,929	51,002	156,326	143,544
Operating income	27,398	25,170	74,563	69,666
Net income (loss)	27,558	25,223	75,005	70,086
EPIC Crude Holdings, LP
Schedule of Equity Method Investments [Line Items]
Revenues	97,514	93,138	284,050	259,250
Operating income	25,052	22,521	70,631	36,148
Net income (loss)	$ (5,159)	$ (11,330)	$ (29,889)	$ (62,312)

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DEBT AND FINANCING COSTS - Additional Information (Details) - USD ($)		3 Months Ended		6 Months Ended	9 Months Ended
	Apr. 02, 2024	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2024	Sep. 30, 2023	Dec. 31, 2023	Jun. 08, 2022
Debt Instrument [Line Items]
Unamortized debt issuance cost		$ 27,400,000		$ 27,400,000	$ 27,400,000		$ 31,500,000
Total long-term debt		3,307,000,000		3,307,000,000	3,307,000,000		3,594,000,000
Loss on debt extinguishment		0	$ 0		525,000	$ 0
Unamortized debt premiums and discounts, net		121,000		121,000	121,000		319,000
Debt, fair value		3,480,000,000		3,480,000,000	3,480,000,000		3,570,000,000
Term Loan
Debt Instrument [Line Items]
Unamortized debt premiums and discounts, net		100,000		100,000	100,000		300,000
Unsecured Debt | Revolving Credit Facility
Debt Instrument [Line Items]
Debt maximum borrowing capacity								$ 1,250,000,000
Letters of credit outstanding		12,600,000		12,600,000	12,600,000		12,600,000
Unused borrowing capacity		730,400,000		730,400,000	730,400,000
If Targets Have Not Been Satisfied | Minimum
Debt Instrument [Line Items]
Debt instrument, interest rate, increase (decrease)	(0.02%)
If Targets Have Not Been Satisfied | Maximum
Debt Instrument [Line Items]
Debt instrument, interest rate, increase (decrease)	(0.05%)
If Targets Have Been Satisfied | Minimum
Debt Instrument [Line Items]
Debt instrument, interest rate, increase (decrease)	0.02%
If Targets Have Been Satisfied | Maximum
Debt Instrument [Line Items]
Debt instrument, interest rate, increase (decrease)	0.05%
A/R Facility
Debt Instrument [Line Items]
Accounts receivable from securitization	$ 150,000,000	150,000,000.0		150,000,000.0	150,000,000.0
Fee, expense, and original issue discounts	1,100,000
Unamortized debt issuance cost		$ 600,000		$ 600,000	$ 600,000
Debt instrument, basis spread on variable rate				0.10%
Debt facility fee percentage					0.90%
Line of credit facility, unused capacity, commitment fee percentage					0.40%
Unsecured term loan | Term Loan
Debt Instrument [Line Items]
Total long-term debt	1,000,000,000						$ 1,200,000,000
Loss on debt extinguishment	$ 500,000

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DEBT AND FINANCING COSTS - Schedule of Long-Term Debt (Details) - USD ($)	Sep. 30, 2024	Apr. 02, 2024	Dec. 31, 2023
Debt Instrument [Line Items]
Total current debt obligations	$ 150,000,000		$ 0
Total long-term debt	3,307,000,000		3,594,000,000
Debt issuance costs, net	(27,432,000)		(31,510,000)
Unamortized debt premiums and discounts, net	121,000		319,000
Total long-term debt, net	3,279,689,000		3,562,809,000
Unamortized debt issuance cost	27,400,000		31,500,000
Term Loan
Debt Instrument [Line Items]
Unamortized debt premiums and discounts, net	100,000		300,000
A/R Facility
Debt Instrument [Line Items]
A/R Facility	150,000,000		0
Unamortized debt issuance cost	$ 600,000
Unsecured term loan | Term Loan
Debt Instrument [Line Items]
Total long-term debt		$ 1,000,000,000	1,200,000,000
5.875% senior unsecured notes due 2030 (“2030 Notes”) | Unsecured Debt
Debt Instrument [Line Items]
Stated percentage	5.875%
Total long-term debt	$ 1,000,000,000		1,000,000,000
6.625% senior unsecured notes due 2028 (“2028 Notes”) | Unsecured Debt
Debt Instrument [Line Items]
Stated percentage	6.625%
Total long-term debt	$ 800,000,000		800,000,000
$1.25 billion revolving line of credit | Revolving Credit Facility
Debt Instrument [Line Items]
Total long-term debt	507,000,000		594,000,000
Unamortized debt issuance cost	4,200,000		$ 5,400,000
$1.25 billion revolving line of credit | Term Loan
Debt Instrument [Line Items]
Face amount	$ 1,250,000,000

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DEBT AND FINANCING COSTS - Schedule of Financing Costs, Net of Capitalized Interest (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Debt Disclosure [Abstract]
Capitalized interest	$ (2,955)	$ (6,731)	$ (4,885)	$ (13,775)
Debt issuance costs	1,916	1,546	5,497	4,601
Interest expense	67,068	50,194	166,933	139,617
Total financing costs, net of capitalized interest	$ 66,029	$ 45,009	$ 167,545	$ 130,443

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ACCRUED EXPENSES (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Payables and Accruals [Abstract]
Accrued product purchases	$ 97,635	$ 109,172
Accrued taxes	20,270	632
Accrued salaries, vacation, and related benefits	5,349	1,872
Accrued capital expenditures	13,911	18,534
Accrued interest	34,070	33,760
Accrued other expenses	20,554	13,451
Total accrued expenses	$ 191,789	$ 177,421

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EQUITY (Details) $ / shares in Units, $ in Thousands			3 Months Ended	9 Months Ended
	Aug. 07, 2024 USD ($)	Jun. 24, 2024 shares	Sep. 30, 2024 USD ($) $ / shares shares	Sep. 30, 2024 USD ($) $ / shares shares	Sep. 30, 2023 shares	Jun. 30, 2024 shares	Dec. 31, 2023 USD ($) $ / shares shares	Jun. 30, 2023 shares	Dec. 31, 2022 shares
Class of Stock [Line Items]
Redeemable noncontrolling interest — Common Unit limited partners | $			$ 4,783,180	$ 4,783,180			$ 3,157,807
Dividends, cash | $	$ 118,200
Class C Common Stock
Class of Stock [Line Items]
Common stock, par value (in USD per share) | $ / shares			$ 0.0001	$ 0.0001			$ 0.0001
Common stock, shares issued (in shares)			97,783,034	97,783,034			94,089,038
Common stock, shares outstanding (in shares)			97,783,034	97,783,034			94,089,038
Class C Common Stock | Durango Permian LLC Acquisition
Class of Stock [Line Items]
Equity interest issuable (in shares)		3,800,000
Class C Common Stock | Durango Permian LLC Acquisition | To Be Issued On July 1, 2025
Class of Stock [Line Items]
Equity interest issuable (in shares)		7,700,000	7,700,000
Class C Common Stock | Common Stock
Class of Stock [Line Items]
Stock redeemed (in shares)				(146,250)	(181,000)
Common stock, par value (in USD per share) | $ / shares			$ 0.0001	$ 0.0001
Common stock, shares issued (in shares)			97,800,000	97,800,000
Common stock, shares outstanding (in shares)			97,783,000	97,783,000	94,089,000	97,783,000	94,089,000	94,089,000	94,270,000
Class A Common Stock
Class of Stock [Line Items]
Common stock, redemption ratio				1
Common stock, par value (in USD per share) | $ / shares			$ 0.0001	$ 0.0001			$ 0.0001
Common stock, shares issued (in shares)			59,751,435	59,751,435			57,096,538
Common stock, shares outstanding (in shares)			59,751,435	59,751,435			57,096,538
Amount of dividends reinvested | $	$ 400
Class A Common Stock | Public Warrants
Class of Stock [Line Items]
Class of warrant or right, purchase ratio for common stock			0.1	0.1
Class A Common Stock | Common Stock
Class of Stock [Line Items]
Stock redeemed (in shares)				146,250	181,000
Common stock, par value (in USD per share) | $ / shares			$ 0.0001	$ 0.0001
Common stock, shares issued (in shares)			59,800,000	59,800,000
Common stock, shares outstanding (in shares)			59,751,000	59,751,000	54,520,000	59,736,000	57,097,000	51,973,000	45,679,000

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FAIR VALUE MEASUREMENTS (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Liabilities
Total liabilities	$ 3,797,986	$ 3,869,889
Fair Value, Recurring
Assets
Total assets	7,869	7,977
Liabilities
Total liabilities	73,224	7,097
Fair Value, Recurring | Commodity swap
Assets
Total assets	7,785	3,663
Liabilities
Total derivative liabilities	3,936	1,749
Fair Value, Recurring | Interest rate derivatives
Assets
Total assets	84	4,314
Liabilities
Total derivative liabilities	3,888	5,348
Fair Value, Recurring | Contingent liability
Liabilities
Contingent liability	65,400
Fair Value, Recurring | Level 1
Assets
Total assets	0	0
Liabilities
Total liabilities	0	0
Fair Value, Recurring | Level 1 | Commodity swap
Assets
Total assets	0	0
Liabilities
Total derivative liabilities	0	0
Fair Value, Recurring | Level 1 | Interest rate derivatives
Assets
Total assets	0	0
Liabilities
Total derivative liabilities	0	0
Fair Value, Recurring | Level 1 | Contingent liability
Liabilities
Contingent liability	0
Fair Value, Recurring | Level 2
Assets
Total assets	7,869	7,977
Liabilities
Total liabilities	7,824	7,097
Fair Value, Recurring | Level 2 | Commodity swap
Assets
Total assets	7,785	3,663
Liabilities
Total derivative liabilities	3,936	1,749
Fair Value, Recurring | Level 2 | Interest rate derivatives
Assets
Total assets	84	4,314
Liabilities
Total derivative liabilities	3,888	5,348
Fair Value, Recurring | Level 2 | Contingent liability
Liabilities
Contingent liability	0
Fair Value, Recurring | Level 3
Assets
Total assets	0	0
Liabilities
Total liabilities	65,400	0
Fair Value, Recurring | Level 3 | Commodity swap
Assets
Total assets	0	0
Liabilities
Total derivative liabilities	0	0
Fair Value, Recurring | Level 3 | Interest rate derivatives
Assets
Total assets	0	0
Liabilities
Total derivative liabilities	0	$ 0
Fair Value, Recurring | Level 3 | Contingent liability
Liabilities
Contingent liability	$ 65,400

XML

DERIVATIVES AND HEDGING ACTIVITIES - Additional Information (Details) $ in Millions	9 Months Ended
	Sep. 30, 2024 USD ($) agreement
Interest Rate Swap | Maturing May 31, 2025
Derivative Instruments, Gain (Loss) [Line Items]
Number of instruments held | agreement	2
Derivative notional amount | $	$ 1,700
Interest Rate Swap | Maturing May 31, 2025 | Minimum
Derivative Instruments, Gain (Loss) [Line Items]
Derivative, fixed interest rate	4.38%
Interest Rate Swap | Maturing May 31, 2025 | Maximum
Derivative Instruments, Gain (Loss) [Line Items]
Derivative, fixed interest rate	4.48%
Interest Rate Swap | Maturing December 31, 2025
Derivative Instruments, Gain (Loss) [Line Items]
Number of instruments held | agreement	1
Derivative notional amount | $	$ 80
Derivative, fixed interest rate	3.02%
Commodity Swap | Minimum
Derivative Instruments, Gain (Loss) [Line Items]
Term of contract	1 month
Commodity Swap | Maximum
Derivative Instruments, Gain (Loss) [Line Items]
Term of contract	20 months

XML

DERIVATIVES AND HEDGING ACTIVITIES - Fair Value of Derivative Assets and Liabilities (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivatives assets - current	$ 6,276	$ 7,812
Derivative asset, non-current	1,593	165
Derivative liabilities - current	6,743	1,734
Derivatives liabilities - noncurrent	1,081	5,363
Interest Rate Swap
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivatives assets - current	76	4,314
Derivative asset, non-current	8	0
Total derivative assets	84	4,314
Derivative liabilities - current	3,888	0
Derivatives liabilities - noncurrent	0	5,348
Total derivative liabilities	3,888	5,348
Commodity Swap
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivatives assets - current	6,200	3,498
Derivative asset, non-current	1,585	165
Total derivative assets	7,785	3,663
Derivative liabilities - current	2,855	1,734
Derivatives liabilities - noncurrent	1,081	15
Total derivative liabilities	$ 3,936	$ 1,749

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DERIVATIVES AND HEDGING ACTIVITIES - Derivatives activities (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Realized (loss) gain on commodity swaps			$ (8,938)	$ 41,028
Interest Rate Swap
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Realized (loss) gain on commodity swaps	$ 3,994	$ 4,665	11,899	7,082
Favorable (unfavorable) fair value adjustment	(8,342)	12,500	9,129	34,562
Commodity Swap
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Realized (loss) gain on commodity swaps	(2,790)	176	(20,002)	8,029
Favorable (unfavorable) fair value adjustment	$ 6,027	$ (8,083)	$ (18,067)	$ 6,466

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DERIVATIVES AND HEDGING ACTIVITIES - Schedule of Detail Information of Commodity Swaps Outstanding (Details) - Commodity Swap $ in Thousands	9 Months Ended
	Sep. 30, 2024 USD ($) MMBTU bbl gal
Derivative [Line Items]
Net Fair Value	$ 3,849
Natural Gas
Derivative [Line Items]
Notional Quantity (Energy) | MMBTU	1,210,000
Net Fair Value	$ 569
NGL
Derivative [Line Items]
Notional Quantity (Volume) | gal	312,215,400
Net Fair Value	$ 917
Crude
Derivative [Line Items]
Notional Quantity (Volume) | bbl	613,000
Net Fair Value	$ 2,563
Crude Collars
Derivative [Line Items]
Notional Quantity (Volume) | bbl	163,800
Net Fair Value	$ 937
Crude Basis Spread Swaps
Derivative [Line Items]
Notional Quantity (Volume) | bbl	22,400
Net Fair Value	$ (9)
Natural Gas Basis Spread Swaps
Derivative [Line Items]
Notional Quantity (Energy) | MMBTU	7,300,000
Net Fair Value	$ (1,128)

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SHARE-BASED COMPENSATION - Schedule of Class A and Class C Shares Activities (Details) - Common Stock	9 Months Ended
	Sep. 30, 2024 $ / shares shares
Number of Shares
Outstanding at the beginning of period (in shares) | shares	5,444,488
Vested (in shares) | shares	43,166
Forfeited (in shares) | shares	1,592
Outstanding at the end of period (in shares) | shares	5,399,730
Weighted Avg Grant-Date Fair Market Value Per Unit
Outstanding at the beginning of period (in dollars per share) | $ / shares	$ 28.91
Vested (in dollars per share) | $ / shares	31.18
Forfeited (in dollars per share) | $ / shares	31.18
Outstanding at the end of period (in dollars per share) | $ / shares	$ 28.90

XML

SHARE-BASED COMPENSATION - Schedule of Aggregate Intrinsic Value (Market Value At Vesting Date) (Details) - Cash consideration paid - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2024	Sep. 30, 2024
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Aggregate intrinsic value of vested Class A Shares	$ 1,102	$ 1,756
Grant-date fair value of vested Class A Shares	$ 834	$ 1,346

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SHARE-BASED COMPENSATION - Additional Information (Details) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024 USD ($) shares	Sep. 30, 2023 USD ($)	Sep. 30, 2024 USD ($) shares	Sep. 30, 2023 USD ($)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation | $	$ 15,171	$ 12,502	$ 52,868	$ 43,340
Class A and Class C Shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Cost not yet recognized | $	38,800		$ 38,800
Period for recognition for remaining compensation cost			1 year 1 month 28 days
Restricted stock units awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Cost not yet recognized | $	13,000		$ 13,000
Period for recognition for remaining compensation cost			1 year 7 months 20 days
Settlement basis (in shares)			1
Vested (in shares) | shares			323,158
Forfeited (in shares) | shares			12,565
Performance shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Cost not yet recognized | $	$ 5,800		$ 5,800
Period for recognition for remaining compensation cost			2 years 3 months
Performance period			3 years
Vested (in shares) | shares	0		0
Forfeited (in shares) | shares	0		0
Performance shares | Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage of potential target shares			0.00%
Performance shares | Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage of potential target shares			200.00%

XML

SHARE-BASED COMPENSATION - Schedule of RSUs Activities (Details) - Restricted stock units awards	9 Months Ended
	Sep. 30, 2024 $ / shares shares
Number of Shares
Outstanding at the beginning of period (in shares) | shares	435,220
Granted (in shares) | shares	610,333
Vested (in shares) | shares	323,158
Forfeited (in shares) | shares	12,565
Outstanding at the end of period (in shares) | shares	709,830
Weighted Avg Grant-Date Fair Market Value Per Unit
Outstanding at the beginning of period (in dollars per share) | $ / shares	$ 31.15
Granted (in dollars per share) | $ / shares	35.41
Vested (in dollars per share) | $ / shares	34.79
Forfeited (in dollars per share) | $ / shares	33.06
Outstanding at the end of period (in dollars per share) | $ / shares	$ 33.12

XML

SHARE-BASED COMPENSATION - Schedule of Share-Based Payment Arrangement, Restricted Stock and Restricted Stock Unit, Activity (Details) - Restricted stock units awards - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Aggregate intrinsic value of vested RSUs	$ 387	$ 34	$ 11,469	$ 7,340
Grant-date fair value of vested RSUs	$ 372	$ 35	$ 11,243	$ 6,827

XML

SHARE-BASED COMPENSATION - Schedule of PSUs Activities (Details) - Performance shares	9 Months Ended
	Sep. 30, 2024 $ / shares shares
Number of Shares
Granted (in shares) | shares	198,703
Outstanding and unvested (in shares) | shares	198,703
Weighted Avg Grant-Date Fair Market Value Per Unit
Granted (in dollars per share) | $ / shares	$ 36.76
Outstanding and unvested (in dollars per share) | $ / shares	$ 36.76

XML

SHARE-BASED COMPENSATION - Grant Fair Value Assumptions (Details) - Performance shares	1 Months Ended
	Mar. 31, 2024 $ / shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant-date fair value per unit	$ 36.76
Beginning average price	$ 32.84
Risk-free interest rate	4.21%
Volatility factor	37.00%
Expected term	2 years 9 months 25 days

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INCOME TAXES (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Income Tax Disclosure [Abstract]
Income before income taxes	$ 91,914	$ 44,434	$ 249,270	$ 121,128
Income tax expense	$ 8,260	$ 1,303	$ 21,261	$ 2,030
Effective tax rate	8.99%	2.93%	8.53%	1.68%

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NET INCOME PER SHARE (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Earnings Per Share [Abstract]
Net income attributable to Class A common shareholders	$ 25,763	$ 15,580	$ 74,505	$ 42,030
Less: Net income available to participating unvested restricted Class A common shareholders	(4,755)	(4,414)	(13,636)	(12,996)
Total net income attributable to Class A common shareholders - basic	$ 21,008	$ 11,166	$ 60,869	$ 29,034
Weighted average shares outstanding - basic (in shares)	59,811	53,340	59,116	50,464
Dilutive effect of unvested Class A common shares (in shares)	613	123	736	255
Weighted average shares outstanding - diluted (in shares)	60,424	53,463	59,852	50,719
Net income available per common share - basic (in USD per share)	$ 0.35	$ 0.21	$ 1.03	$ 0.58
Net income available per common share - diluted (in USD per share)	$ 0.35	$ 0.21	$ 1.02	$ 0.57

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COMMITMENTS AND CONTINGENCIES (Details) - USD ($)		3 Months Ended	9 Months Ended
	Jun. 11, 2019	Sep. 30, 2024	Sep. 30, 2024	Sep. 30, 2023	Jun. 24, 2024	Dec. 31, 2023	Feb. 28, 2021
Loss Contingencies [Line Items]
Loss contingency accrual		$ 0	$ 0			$ 0
Contingent liabilities fair value adjustment		(1,400,000)	1,400,000	$ 0
Permian Gas
Loss Contingencies [Line Items]
Contingent consideration		0	0			$ 0
Maximum annual amount to be paid	$ 60,500,000
Period of annual volume without exceeding incentive forecast volume	4 years
Expected period of annual volume without exceeding incentive forecast volume	5 years
Durango Permian LLC Acquisition
Loss Contingencies [Line Items]
Contingent consideration					$ 64,000,000
Durango Permian LLC Acquisition | Kinetik LP
Loss Contingencies [Line Items]
Contingent consideration		65,400,000	$ 65,400,000		75,000,000.0
Contingent liabilities fair value adjustment		$ 1,400,000
Durango Permian LLC Acquisition | Kinetik LP | Initial Contingent Liabilities
Loss Contingencies [Line Items]
Contingent consideration					$ 64,000,000.0
Winter Storm Uri
Loss Contingencies [Line Items]
Receivable							$ 11,600,000
Receivable, noncurrent							8,000,000
Receivable allowance							$ 0

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SEGMENTS (Details) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024 USD ($) stream agreement	Sep. 30, 2023 USD ($)	Sep. 30, 2024 USD ($) stream Segment agreement	Sep. 30, 2023 USD ($)	Dec. 31, 2023 USD ($)
Segment Reporting [Abstract]
Number of operating segments | Segment			2
Number of reportable segments | Segment			2
Segment Reporting Information [Line Items]
Segment income (loss) before income taxes	$ 91,914	$ 44,434	$ 249,270	$ 121,128
Add back:
Interest expense	66,029	45,009	167,545	130,443
Depreciation and amortization expenses	87,583	69,935	236,250	208,271
Contract assets amortization	1,655	1,655	4,965	4,965
Proportionate EMI EBITDA	88,229	78,585	262,553	224,933
Share-based compensation	15,171	12,502	52,868	43,340
Contingent liabilities fair value adjustment			1,400
Loss on disposal of assets	0	(2,927)	(4,090)	(15,166)
Loss on debt extinguishment	0	0	525	0
Unrealized loss on derivatives	(8,817)		(1,935)
Contingent liabilities fair value adjustment	1,400		(1,400)	0
Integration costs	2,540	21	5,091	985
Acquisition transaction costs	31	378
Other one-time costs or amortization	3,717	2,662	8,448	7,545
Change in fair value of warrants		4	0	(73)
Deduct:
Interest income	572	293		314
Commodity hedging unrealized gain	8,817		1,935
Other interest income			1,459
Gain on sale of equity method investment	29,953	0	89,837	0
Equity income from unconsolidated affiliates	53,244	50,754	169,668	146,828
Segment adjusted EBITDA	265,683	215,324	733,644	610,825
Revenue	396,362	330,301	1,097,213	907,544
Total assets	6,860,461		6,860,461		$ 6,496,873
Investments in unconsolidated affiliates	2,141,947		2,141,947		2,540,989
Product and Service
Deduct:
Revenue	393,523	325,629	1,088,802	896,859
Other revenue
Deduct:
Revenue	2,839		8,411	10,685
Midstream Logistics
Deduct:
Revenue	0
Midstream Logistics | Other revenue
Deduct:
Revenue		4,672
Operating Segments
Deduct:
Total assets	$ 6,620,988		$ 6,620,988		6,476,352
Operating Segments | Midstream Logistics
Segment Reporting Information [Line Items]
Number of streams in which a segment operates | stream	3		3
Segment income (loss) before income taxes	$ 88,581	56,584	$ 215,196	163,794
Add back:
Interest expense	2,666	12	5,273	32
Depreciation and amortization expenses	85,273	69,456	229,336	206,855
Contract assets amortization	1,655	1,655	4,965	4,965
Proportionate EMI EBITDA	0	0	0	0
Share-based compensation	0	0	0	0
Contingent liabilities fair value adjustment			1,400
Loss on disposal of assets		(2,927)	(4,090)	(15,166)
Loss on debt extinguishment			0
Unrealized loss on derivatives	(8,817)	8,259	(1,935)	616
Contingent liabilities fair value adjustment	1,400
Integration costs	1,208	21	1,792	29
Acquisition transaction costs	0	0	0	33
Other one-time costs or amortization	1,657	1,529	4,048	5,310
Change in fair value of warrants		0		0
Deduct:
Interest income	0	0		0
Commodity hedging unrealized gain	8,817	(8,259)	1,935	(616)
Other interest income			0
Gain on sale of equity method investment	0		0
Equity income from unconsolidated affiliates	0	0	0	0
Segment adjusted EBITDA	173,623	140,443	464,165	396,800
Revenue	394,168	329,533	1,090,358	905,348
Total assets	4,323,444		4,323,444		3,772,764
Operating Segments | Midstream Logistics | Product and Service
Deduct:
Revenue	391,331	324,863	1,082,236	894,669
Operating Segments | Midstream Logistics | Other revenue
Deduct:
Revenue	$ 2,837		$ 8,122
Operating Segments | Midstream Logistics | Revenue Benchmark | Segment Concentration Risk
Segment Reporting Information [Line Items]
Concentration risk, percentage			97.00%
Operating Segments | Midstream Logistics | Operating Revenues, Cost of Sales, Operating Expenses and Ad Valorem Expenses | Segment Concentration Risk
Segment Reporting Information [Line Items]
Concentration risk, percentage			99.00%
Operating Segments | Midstream Logistics | Valorem Expenses | Segment Concentration Risk
Segment Reporting Information [Line Items]
Concentration risk, percentage			94.00%
Operating Segments | Midstream Logistics | EBITDA | Segment Concentration Risk
Segment Reporting Information [Line Items]
Concentration risk, percentage	65.00%
Operating Segments | Pipeline Transportation
Segment Reporting Information [Line Items]
Number of pipelines with equity investment interest | agreement	3		3
Segment income (loss) before income taxes	$ 88,797	50,598	$ 275,246	146,524
Add back:
Interest expense	0	0	0	0
Depreciation and amortization expenses	2,305	473	6,897	1,398
Contract assets amortization	0	0	0	0
Proportionate EMI EBITDA	88,229	78,585	262,553	224,933
Share-based compensation	0	0	0	0
Contingent liabilities fair value adjustment			0
Loss on disposal of assets		0	0	0
Loss on debt extinguishment			0
Unrealized loss on derivatives	0	0	0	0
Contingent liabilities fair value adjustment	0
Integration costs	0	0	0	0
Acquisition transaction costs	0	0	0	0
Other one-time costs or amortization	0	0	0	0
Change in fair value of warrants		0		0
Deduct:
Interest income	0	0		0
Commodity hedging unrealized gain	0	0	0	0
Other interest income			0
Gain on sale of equity method investment	29,953		89,837
Equity income from unconsolidated affiliates	53,244	50,754	169,668	146,828
Segment adjusted EBITDA	96,134	78,902	285,191	226,027
Revenue	8,942	768	26,143	2,196
Total assets	2,297,544		2,297,544		2,703,588
Operating Segments | Pipeline Transportation | Product and Service
Deduct:
Revenue	2,192	766	6,566	2,190
Operating Segments | Pipeline Transportation | Other revenue
Deduct:
Revenue	$ 2		289
Operating Segments | Pipeline Transportation | EBITDA | Segment Concentration Risk
Segment Reporting Information [Line Items]
Concentration risk, percentage	36.00%
Corporate and Other
Segment Reporting Information [Line Items]
Segment income (loss) before income taxes	$ (85,464)	(62,748)	(241,172)	(189,190)
Add back:
Interest expense	63,363	44,997	162,272	130,411
Depreciation and amortization expenses	5	6	17	18
Contract assets amortization	0	0	0	0
Proportionate EMI EBITDA	0	0	0	0
Share-based compensation	15,171	12,502	52,868	43,340
Contingent liabilities fair value adjustment			0
Loss on disposal of assets		0	0	0
Loss on debt extinguishment			525
Unrealized loss on derivatives	0	0	0	0
Contingent liabilities fair value adjustment	0
Integration costs	1,332	0	3,299	956
Acquisition transaction costs	31	378	3,538	615
Other one-time costs or amortization	2,060	1,133	4,400	2,235
Change in fair value of warrants		4		(73)
Deduct:
Interest income	572	293		314
Commodity hedging unrealized gain	0	0	0	0
Other interest income			1,459
Gain on sale of equity method investment	0		0
Equity income from unconsolidated affiliates	0	0	0	0
Segment adjusted EBITDA	(4,074)	(4,021)	(15,712)	(12,002)
Total assets	239,473		$ 239,473		$ 20,521
Corporate and Other | General and Administrative Expenses and Debt Service Costs | Segment Concentration Risk
Segment Reporting Information [Line Items]
Concentration risk, percentage			84.00%
Elimination
Deduct:
Revenue	(6,748)	0	$ (19,288)	0
Elimination | Product and Service
Deduct:
Revenue	0	0	0	0
Elimination | Other revenue
Deduct:
Revenue	0		0	0
Elimination | Midstream Logistics
Deduct:
Revenue	0		0
Elimination | Midstream Logistics | Other revenue
Deduct:
Revenue		4,670		10,679
Elimination | Pipeline Transportation
Deduct:
Revenue	$ 6,748		19,288
Elimination | Pipeline Transportation | Other revenue
Deduct:
Revenue		2		6
Consolidated
Add back:
Unrealized loss on derivatives		8,259		616
Acquisition transaction costs			$ 3,538	648
Deduct:
Commodity hedging unrealized gain		$ (8,259)		$ (616)

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SUBSEQUENT EVENTS (Details) - Subsequent Event	Oct. 17, 2024 $ / shares
Kinetik LP
Subsequent Event [Line Items]
Dividends declared (in USD per share)	$ 0.78
Class A Common Stock
Subsequent Event [Line Items]
Dividends declared (in USD per share)	$ 0.78