XML 66 R25.htm IDEA: XBRL DOCUMENT v3.25.4
Derivative Financial Instruments
 12 Months Ended
Dec. 31, 2025
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Derivative Financial Instruments Derivative Financial Instruments
Embedded Derivative - MPLX has a natural gas purchase commitment embedded in a keep-whole processing agreement with a producer customer in the Southern Appalachia region expiring in December 2027. The customer has the unilateral option to extend the agreement for one five-year term through December 2032. For accounting purposes, the natural gas purchase commitment and the term extending option have been aggregated into a single compound embedded derivative. The probability of the customer exercising its option is determined based on assumptions about the customer’s potential business strategy decision points that may exist at the time they would elect whether to renew the contract. The changes in fair value of this compound embedded derivative are based on the difference between the contractual and index pricing, the probability of the producer customer exercising its option to extend, and the estimated favorability of these contracts compared to current market conditions. The changes in fair value are recorded in earnings through Purchased product costs in the Consolidated Statements of Income. For further information regarding the fair value measurement of derivative instruments, see Note 15. See Note 2 for a discussion of derivatives MPLX may use and the reasons for them. At December 31, 2025 and 2024, the estimated fair value of this contract was a liability of $41 million and $58 million, respectively.
As of December 31, 2025 and 2024, there were no derivative assets or liabilities that were offset in the Consolidated Balance Sheets.
The impact of MPLX’s derivative contracts not designated as hedging instruments and the location of gains and losses recognized in the Consolidated Statements of Income is summarized below:
(In millions)202520242023
Product sales
Realized gain$— $1 $7 
Product sales derivative gain— 1 7 
Purchased product costs
Realized loss(10)(13)(11)
Unrealized gain17 3 — 
Purchased product cost derivative (loss)/gain7 (10)(11)
Total derivative (loss)/gain included in Net Income$7 $(9)$(4)