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Business Segments and Related Information | 3 Months Ended
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Mar. 31, 2025
Business Segments [Abstract] |
Business Segments and Related Information | Note 10. Business Segments and Related Information Our operations are reported under four business segments: (i) NGL Pipelines & Services, (ii) Crude Oil Pipelines & Services, (iii) Natural Gas Pipelines & Services and (iv) Petrochemical & Refined Products Services. Our business segments are generally organized and managed according to the types of services rendered (or technologies employed) and products produced and/or sold. Financial information regarding these segments is evaluated regularly by our co-chief operating decision makers (“CODMs”) in deciding how to allocate resources and in assessing our operating and financial performance. The co-principal executive officers of our general partner have been identified as our CODMs. The following information summarizes the assets and operations of each business segment:
• | Our NGL Pipelines & Services business segment includes our natural gas processing and related NGL marketing activities, NGL pipelines, NGL fractionation facilities, NGL and related product storage facilities, and NGL marine terminals.
• | Our Crude Oil Pipelines & Services business segment includes our crude oil pipelines, crude oil storage and marine terminals, and related crude oil marketing activities.
• | Our Natural Gas Pipelines & Services business segment includes our natural gas pipeline systems that provide for the gathering, treating and transportation of natural gas. This segment also includes our natural gas marketing activities.
• | Our Petrochemical & Refined Products Services business segment includes our (i) propylene production facilities, which include propylene fractionation units and PDH facilities, and related pipelines and marketing activities, (ii) butane isomerization complex and related deisobutanizer operations, (iii) octane enhancement, iBDH and HPIB production facilities, (iv) refined products pipelines, terminals and related marketing activities, (v) ethylene export terminal and related operations; and (vi) marine transportation business.
Our plants, pipelines and other fixed assets are located in the U.S. Segment Gross Operating Margin Our CODMs evaluate segment performance based on our financial measure of gross operating margin. Gross operating margin is an important performance measure of the core profitability of our operations, forms the basis of our internal financial reporting, and is used by our CODMs on a monthly basis to monitor budgeted versus actual results. Our CODMs also consider gross operating margin results, in part, when determining how to allocate resources (e.g., employees and capital investments) to each segment, primarily in the annual budget process. We believe that investors benefit from having access to the same financial measures that our management uses in evaluating segment results. Gross operating margin is exclusive of other income and expense transactions, income taxes, the cumulative effect of changes in accounting principles and extraordinary charges. Gross operating margin is presented on a 100% basis before any allocation of earnings to noncontrolling interests. Our calculation of gross operating margin may or may not be comparable to similarly titled measures used by other companies. The following table presents a reconciliation of total segment gross operating margin to income before income taxes for the periods indicated:
|  | For the Three Months Ended March 31, |
|  | 2025 |  |  | 2024 |
Total segment gross operating margin |  | $ | 2,464 |  |  | $ | 2,507 |
Adjustments to reconcile total segment gross operating margin to income before income taxes (addition or subtraction indicated by sign): |  |  |  |  |  |  |  |
Depreciation, amortization and accretion expense in operating costs and expenses (1) |  |  | (602 | ) |  |  | (582 | )
Asset impairment charges in operating costs and expenses |  |  | (10 | ) |  |  | (20 | )
Net gains attributable to asset sales and related matters in operating costs and expenses |  |  | 2 |  |  |  | – |
General and administrative costs |  |  | (60 | ) |  |  | (66 | )
Non-refundable payments received from shippers attributable to make-up rights (2) |  |  | (37 | ) |  |  | (25 | )
Subsequent recognition of revenues attributable to make-up rights (3) |  |  | 4 |  |  |  | 8 |
Total other expense, net (4) |  |  | (331 | ) |  |  | (318 | )
Income before income taxes |  | $ | 1,430 |  |  | $ | 1,504 |
(1) | Excludes amortization of major maintenance costs for reaction-based plants and amortization of finance lease right-of-use (“ROU”) assets, which are components of gross operating margin.
(2) | Since make-up rights entail a future performance obligation by the pipeline to the shipper, these receipts are recorded as deferred revenue for GAAP purposes; however, these receipts are included in gross operating margin in the period of receipt since they are nonrefundable to the shipper.
(3) | As deferred revenues attributable to make-up rights are subsequently recognized as revenue under GAAP, gross operating margin must be adjusted to remove such amounts to prevent duplication since the associated non-refundable payments were previously included in gross operating margin.
(4) | As presented on our Statements of Consolidated Operations, Total other expense, net is comprised of Interest expense, Interest income and Other, net.
Summarized Segment Financial Information The following tables present segment revenues and significant segment expenses by segment, together with a reconciliation to segment gross operating margin, for the periods indicated:
|  | For the Three Months Ended March 31, 2025 |
|  | NGL Pipelines & Services |  |  | Crude Oil Pipelines & Services |  |  | Natural Gas Pipelines & Services |  |  | Petrochemical & Refined Products Services |  |  | Segment Total |
Segment revenues: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Revenues from third parties |  | $ | 5,398 |  |  | $ | 5,115 |  |  | $ | 1,216 |  |  | $ | 3,675 |  |  | $ | 15,404 |
Revenues from related parties |  |  | 2 |  |  |  | 6 |  |  |  | 5 |  |  |  | – |  |  |  | 13 |
Intersegment and intrasegment revenues |  |  | 17,017 |  |  |  | 10,622 |  |  |  | 232 |  |  |  | 7,195 |  |  |  | 35,066 |
Total segment revenues |  |  | 22,417 |  |  |  | 15,743 |  |  |  | 1,453 |  |  |  | 10,870 |  |  |  | 50,483 |
Significant segment expenses: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cost of sales |  |  | 20,433 |  |  |  | 15,307 |  |  |  | 899 |  |  |  | 10,156 |  |  |  | 46,795 |
Variable operating costs and expenses (1) |  |  | 199 |  |  |  | 35 |  |  |  | 22 |  |  |  | 106 |  |  |  | 362 |
Fixed operating costs and expenses (2) |  |  | 423 |  |  |  | 101 |  |  |  | 177 |  |  |  | 294 |  |  |  | 995 |
Total significant segment expenses |  |  | 21,055 |  |  |  | 15,443 |  |  |  | 1,098 |  |  |  | 10,556 |  |  |  | 48,152 |
Other segment income: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Equity in income of unconsolidated affiliates |  |  | 20 |  |  |  | 72 |  |  |  | 2 |  |  |  | – |  |  |  | 94 |
Other segment items (3) |  |  | 36 |  |  |  | 2 |  |  |  | – |  |  |  | 1 |  |  |  | 39 |
Total other segment income |  |  | 56 |  |  |  | 74 |  |  |  | 2 |  |  |  | 1 |  |  |  | 133 |
Total segment gross operating margin |  | $ | 1,418 |  |  | $ | 374 |  |  | $ | 357 |  |  | $ | 315 |  |  | $ | 2,464 |
Other financial information: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Capital expenditures |  | $ | 635 |  |  | $ | 23 |  |  | $ | 303 |  |  | $ | 101 |  |  | $ | 1,062 |
(1) | Variable operating costs and expenses represent the cost of operating our plants, pipelines and other fixed assets that generally fluctuate based on utilization.
(2) | Fixed operating costs and expenses represent the cost of operating our plants, pipelines and other fixed assets that generally remain constant independent of utilization.
(3) | Other segment items for each segment primarily represent the following: • NGL Pipelines & Services – Non-refundable payments received from shippers attributable to make-up rights and subsequent recognition of revenues attributable to make-up rights. • Crude Oil Pipelines & Services – Other segment expenses. • Petrochemical & Refined Products Services – Other segment expenses.
|  | For the Three Months Ended March 31, 2024 |
|  | NGL Pipelines & Services |  |  | Crude Oil Pipelines & Services |  |  | Natural Gas Pipelines & Services |  |  | Petrochemical & Refined Products Services |  |  | Segment Total |
Segment revenues: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Revenues from third parties |  | $ | 5,137 |  |  | $ | 5,406 |  |  | $ | 851 |  |  | $ | 3,351 |  |  | $ | 14,745 |
Revenues from related parties |  |  | 3 |  |  |  | 9 |  |  |  | 3 |  |  |  | – |  |  |  | 15 |
Intersegment and intrasegment revenues |  |  | 11,555 |  |  |  | 13,827 |  |  |  | 177 |  |  |  | 6,324 |  |  |  | 31,883 |
Total segment revenues |  |  | 16,695 |  |  |  | 19,242 |  |  |  | 1,031 |  |  |  | 9,675 |  |  |  | 46,643 |
Significant segment expenses: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cost of sales |  |  | 14,810 |  |  |  | 18,749 |  |  |  | 558 |  |  |  | 8,875 |  |  |  | 42,992 |
Variable operating costs and expenses (1) |  |  | 174 |  |  |  | 46 |  |  |  | 15 |  |  |  | 94 |  |  |  | 329 |
Fixed operating costs and expenses (2) |  |  | 425 |  |  |  | 104 |  |  |  | 150 |  |  |  | 249 |  |  |  | 928 |
Total significant segment expenses |  |  | 15,409 |  |  |  | 18,899 |  |  |  | 723 |  |  |  | 9,218 |  |  |  | 44,249 |
Other segment income (expense): |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Equity in income of unconsolidated affiliates |  |  | 31 |  |  |  | 69 |  |  |  | 2 |  |  |  | – |  |  |  | 102 |
Other segment items (3) |  |  | 23 |  |  |  | (1 | ) |  |  | 2 |  |  |  | (13 | ) |  |  | 11 |
Total other segment income (expense), net |  |  | 54 |  |  |  | 68 |  |  |  | 4 |  |  |  | (13 | ) |  |  | 113 |
Total segment gross operating margin |  | $ | 1,340 |  |  | $ | 411 |  |  | $ | 312 |  |  | $ | 444 |  |  | $ | 2,507 |
Other financial information: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Capital expenditures |  | $ | 577 |  |  | $ | 37 |  |  | $ | 204 |  |  | $ | 229 |  |  | $ | 1,047 |
(1) | Variable operating costs and expenses represent the cost of operating our plants, pipelines and other fixed assets that generally fluctuate based on utilization.
(2) | Fixed operating costs and expenses represent the cost of operating our plants, pipelines and other fixed assets that generally remain constant independent of utilization.
(3) | Other segment items for each segment primarily represent the following: • NGL Pipelines & Services – Non-refundable payments received from shippers attributable to make-up rights and subsequent recognition of revenues attributable to make-up rights. • Crude Oil Pipelines & Services – Other segment expenses. • Natural Gas Pipelines & Services – Other segment expenses. • Petrochemical & Refined Products Services – Other segment expenses.
Segment revenues include intersegment and intrasegment transactions, which are generally based on transactions made at market-based rates. Our consolidated revenues reflect the elimination of intercompany transactions. The following table reconciles total segment revenues as reported in the preceding tables to consolidated revenues as presented on our Unaudited Condensed Statements of Consolidated Operations:
|  | For the Three Months Ended March 31, |
|  | 2025 |  |  | 2024 |
Segment revenues: |  |  |  |  |  |
NGL Pipelines & Services |  | $ | 22,417 |  |  | $ | 16,695 |
Crude Oil Pipelines & Services |  |  | 15,743 |  |  |  | 19,242 |
Natural Gas Pipelines & Services |  |  | 1,453 |  |  |  | 1,031 |
Petrochemical & Refined Products Services |  |  | 10,870 |  |  |  | 9,675 |
Total segment revenues |  |  | 50,483 |  |  |  | 46,643 |
Elimination of intersegment and intrasegment revenues |  |  | (35,066 | ) |  |  | (31,883 | )
Total consolidated revenues |  | $ | 15,417 |  |  | $ | 14,760 |
Segment expenses represent operating costs and expenses exclusive of (i) depreciation, amortization and accretion expenses (excluding amortization of major maintenance costs for reaction-based plants and amortization of finance lease right-of-use assets), (ii) impairment charges, and (iii) gains and losses attributable to asset sales and related matters. Segment expense presented in the tables above include intersegment and intrasegment transactions, which are generally based on transactions made at market-based rates. Additionally, the significant segment expense categories presented align with the manner in which our CODMs evaluate segment results. Our consolidated operating costs and expenses are inclusive of the aforementioned adjustments and reflect the elimination of intercompany transactions. The following table presents our segment assets, together with a reconciliation to our consolidated total assets, at the dates indicated:
|  | March 31, 2025 |  |  | December 31, 2024 |
NGL Pipelines & Services |  | $ | 21,735 |  |  | $ | 21,900 |
Crude Oil Pipelines & Services |  |  | 11,327 |  |  |  | 11,390 |
Natural Gas Pipelines & Services |  |  | 12,312 |  |  |  | 12,260 |
Petrochemical & Refined Products Services |  |  | 11,276 |  |  |  | 11,350 |
Total segment assets |  |  | 56,650 |  |  |  | 56,900 |
Construction in progress |  |  | 4,981 |  |  |  | 4,138 |
Current assets |  |  | 12,763 |  |  |  | 15,133 |
Other assets |  |  | 1,012 |  |  |  | 997 |
Consolidated total assets |  | $ | 75,406 |  |  | $ | 77,168 |
Supplemental Revenue and Expense Information The following table presents additional information regarding our consolidated revenues and costs and expenses for the periods indicated:
|  | For the Three Months Ended March 31, |
|  | 2025 |  |  | 2024 |
Consolidated revenues: |  |  |  |  |  |
NGL Pipelines & Services |  | $ | 5,400 |  |  | $ | 5,140 |
Crude Oil Pipelines & Services |  |  | 5,121 |  |  |  | 5,415 |
Natural Gas Pipelines & Services |  |  | 1,221 |  |  |  | 854 |
Petrochemical & Refined Products Services |  |  | 3,675 |  |  |  | 3,351 |
Total consolidated revenues |  | $ | 15,417 |  |  | $ | 14,760 |
Consolidated costs and expenses |  |  |  |  |  |  |  |
Operating costs and expenses: |  |  |  |  |  |  |  |
Cost of sales |  | $ | 12,005 |  |  | $ | 11,405 |
Other operating costs and expenses (1) |  |  | 1,059 |  |  |  | 954 |
Depreciation, amortization and accretion |  |  | 618 |  |  |  | 595 |
Asset impairment charges |  |  | 10 |  |  |  | 20 |
Net gains attributable to asset sales and related matters |  |  | (2 | ) |  |  | – |
General and administrative costs |  |  | 60 |  |  |  | 66 |
Total consolidated costs and expenses |  | $ | 13,750 |  |  | $ | 13,040 |
(1) | Represents the cost of operating our plants, pipelines and other fixed assets excluding depreciation, amortization and accretion charges; asset impairment charges; and net gains attributable to asset sales and related matters.
Fluctuations in our product sales revenues and cost of sales amounts are explained in large part by changes in energy commodity prices. In general, higher energy commodity prices result in an increase in our revenues attributable to product sales; however, these higher commodity prices would also be expected to increase the associated cost of sales as purchase costs are higher. The same type of relationship would be true in the case of lower energy commodity sales prices and purchase costs.

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- Definition The entire disclosure for reporting segments including data and tables. 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