Reportable Segments

Our reportable business segments are:


•	Natural Gas Pipelines—the ownership and operation of (i) major interstate and intrastate natural gas pipeline and storage systems; (ii) natural gas and crude oil gathering systems and natural gas processing and treating facilities; (iii) NGL fractionation facilities and transportation systems; and (iv) LNG facilities;


•	CO₂—(i) the production, transportation and marketing of CO₂ to oil fields that use CO₂ as a flooding medium for recovering crude oil from mature oil fields to increase production; (ii) ownership interests in and/or operation of oil fields and gas processing plants in West Texas; and (iii) the ownership and operation of a crude oil pipeline system in West Texas;


•	Terminals—the ownership and/or operation of (i) liquids and bulk terminal facilities located throughout the U.S. and portions of Canada that transload and store refined petroleum products, crude oil, chemicals, and ethanol and bulk products, including petroleum coke, steel and coal; and (ii) Jones Act tankers;


•	Products Pipelines—the ownership and operation of refined petroleum products, NGL and crude oil and condensate pipelines that primarily deliver, among other products, gasoline, diesel and jet fuel, propane, ethane, crude oil and condensate to various markets, plus the ownership and/or operation of associated product terminals and petroleum pipeline transmix facilities; and


•	Kinder Morgan Canada—the ownership and operation of the Trans Mountain pipeline system that transports crude oil and refined petroleum products from Edmonton, Alberta, Canada to marketing terminals and refineries in British Columbia, Canada and the state of Washington, plus the Jet Fuel aviation turbine fuel pipeline that serves the Vancouver (Canada) International Airport.

We evaluate performance principally based on each segment’s EBDA, which excludes general and administrative expenses, interest expense, net, and income tax expense. Our reportable segments are strategic business units that offer different products and services, and they are structured based on how our chief operating decision makers organize their operations for optimal performance and resource allocation. Each segment is managed separately because each segment involves different products and marketing strategies.

We consider each period’s earnings before all non-cash DD&A expenses to be an important measure of business segment performance for our reporting segments. We account for intersegment sales at market prices, while we account for asset transfers at either market value or, in some instances, book value.

During 2017, 2016 and 2015, we did not have revenues from any single external customer that exceeded 10% of our consolidated revenues.

Financial information by segment follows (in millions):



	Year Ended December 31,
	2017		2016		2015
Revenues
Natural Gas Pipelines
Revenues from external customers	$	8,608	$	7,998	$	8,704
Intersegment revenues	10		7		21
CO₂	1,196		1,221		1,699
Terminals
Revenues from external customers	1,965		1,921		1,878
Intersegment revenues	1		1		1
Products Pipelines
Revenues from external customers	1,645		1,631		1,828
Intersegment revenues	16		18		3
Kinder Morgan Canada	256		253		260
Corporate and intersegment eliminations(a)	8		8		9
Total consolidated revenues	$	13,705	$	13,058	$	14,403



	Year Ended December 31,
	2017			2016		2015
Operating expenses(b)
Natural Gas Pipelines	$	5,457		$	4,393	$	4,738
CO₂	394			399		432
Terminals	788			768		836
Products Pipelines	487			573		772
Kinder Morgan Canada	95			87		87
Corporate and intersegment eliminations	(6		)	2		26
Total consolidated operating expenses	$	7,215		$	6,222	$	6,891



	Year Ended December 31,
	2017			2016			2015
Other expense (income)(c)
Natural Gas Pipelines	$	26		$	199		$	1,269
CO₂	(1		)	19			606
Terminals	(14		)	99			190
Products Pipelines	—			76			2
Kinder Morgan Canada	—			—			(1		)
Corporate	1			(7		)	—
Total consolidated other expense (income)	$	12		$	386		$	2,066



	Year Ended December 31,
	2017		2016		2015
DD&A
Natural Gas Pipelines	$	1,011	$	1,041	$	1,046
CO₂	493		446		556
Terminals	472		435		433
Products Pipelines	216		221		206
Kinder Morgan Canada	46		44		46
Corporate	23		22		22
Total consolidated DD&A	$	2,261	$	2,209	$	2,309



	Year Ended December 31,
	2017		2016			2015
Earnings from equity investments and amortization of excess cost of equity investments, including loss on impairments
Natural Gas Pipelines	$	253	$	(269	)	$	285
CO₂	42		22			(5		)
Terminals	24		19			17
Products Pipelines	48		56			36
Total consolidated equity earnings	$	367	$	(172	)	$	333



	Year Ended December 31,
	2017			2016		2015
Other, net-income (expense)
Natural Gas Pipelines	$	49		$	19	$	24
Terminals	8			4		8
Products Pipelines	(1		)	2		4
Kinder Morgan Canada	25			15		8
Corporate	1			4		(1		)
Total consolidated other, net-income (expense)	$	82		$	44	$	43



	Year Ended December 31,
	2017			2016			2015
Segment EBDA(d)
Natural Gas Pipelines	$	3,487		$	3,211		$	3,067
CO₂	847			827			658
Terminals	1,224			1,078			878
Products Pipelines	1,231			1,067			1,106
Kinder Morgan Canada	186			181			182
Total segment EBDA	6,975			6,364			5,891
DD&A	(2,261		)	(2,209		)	(2,309		)
Amortization of excess cost of equity investments	(61		)	(59		)	(51		)
General and administrative and corporate charges	(660		)	(652		)	(708		)
Interest, net	(1,832		)	(1,806		)	(2,051		)
Income tax expense	(1,938		)	(917		)	(564		)
Total consolidated net income	$	223		$	721		$	208



	Year Ended December 31,
	2017		2016		2015
Capital expenditures
Natural Gas Pipelines	$	1,376	$	1,227	$	1,642
CO₂	436		276		725
Terminals	888		983		847
Products Pipelines	127		244		524
Kinder Morgan Canada	338		124		142
Corporate	23		28		16
Total consolidated capital expenditures	$	3,188	$	2,882	$	3,896



	2017		2016
Investments at December 31
Natural Gas Pipelines	$	6,218	$	6,185
CO₂	6		—
Terminals	263		252
Products Pipelines	777		566
Kinder Morgan Canada	34		20
Corporate	—		4
Total consolidated investments	$	7,298	$	7,027



	2017		2016
Assets at December 31
Natural Gas Pipelines	$	51,173	$	50,428
CO₂	3,946		4,065
Terminals	9,935		9,725
Products Pipelines	8,539		8,329
Kinder Morgan Canada	2,080		1,572
Corporate assets(e)	3,382		6,108
Assets held for sale	—		78
Total consolidated assets	$	79,055	$	80,305

_______


(a)	Includes a management fee for services we perform as operator of an equity investee.


(b)	Includes costs of sales, operations and maintenance expenses, and taxes, other than income taxes.


(c)	Includes loss on impairment of goodwill, loss on impairments and divestitures, net and other income, net.


(d)	Includes revenues, earnings from equity investments, other, net, less operating expenses, and other income, net, loss on impairment of goodwill, and loss on impairments and divestitures, net and loss on impairments and divestitures of equity investments, net.

(e)

Includes cash and cash equivalents, margin and restricted deposits, unallocable interest receivable, certain prepaid assets and deferred charges, including income tax related assets, risk management assets related to debt fair value adjustments, corporate headquarters in Houston, Texas and miscellaneous corporate assets (such as information technology, telecommunications equipment and legacy activity) not allocated to the reportable segments.

We do not attribute interest and debt expense to any of our reportable business segments.

Following is geographic information regarding the revenues and long-lived assets of our business (in millions):



	Year Ended December 31,
	2017		2016		2015
Revenues from external customers
U.S.	$	13,073	$	12,459	$	13,797
Canada	503		483		479
Mexico	129		116		127
Total consolidated revenues from external customers	$	13,705	$	13,058	$	14,403



	December 31,
	2017		2016		2015
Long-term assets, excluding goodwill and other intangibles
U.S.	$	47,928	$	49,125	$	51,679
Canada	3,071		2,399		2,193
Mexico	80		82		67
Total consolidated long-lived assets	$	51,079	$	51,606	$	53,939