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SEGMENTS (Notes) | 3 Months Ended
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Mar. 31, 2020
Segment Reporting, Disclosure of Entity's Reportable Segments [Abstract] |
SEGMENTS | SEGMENTS Segment Descriptions - Our operations are divided into three reportable business segments, as follows:
• | our Natural Gas Gathering and Processing segment gathers, treats and processes natural gas;
• | our Natural Gas Liquids segment gathers, treats, fractionates and transports NGLs and stores, markets and distributes NGL products; and
• | our Natural Gas Pipelines segment operates regulated interstate and intrastate natural gas transmission pipelines and natural gas storage facilities.
Other and eliminations consist of corporate costs, the operating and leasing activities of our headquarters building and related parking facility and eliminations necessary to reconcile our reportable segments to our Consolidated Financial Statements. Accounting Policies - The accounting policies of the segments are described in Note A of the Notes to Consolidated Financial Statements in our Annual Report. Operating Segment Information - The following tables set forth certain selected financial information for our operating segments for the periods indicated:
Three Months Ended March 31, 2020 | Natural Gas Gathering and Processing |  | Natural Gas Liquids (a) |  | Natural Gas Pipelines (b) |  | Total Segments
| (Thousands of dollars)
NGL and condensate sales | $ | 219,917 |  |  | $ | 1,596,711 |  |  | $ | — |  |  | $ | 1,816,628 |
Residue natural gas sales | 189,051 |  |  | — |  |  | 2,035 |  |  | 191,086 |
Gathering, processing and exchange services revenue | 37,937 |  |  | 120,536 |  |  | — |  |  | 158,473 |
Transportation and storage revenue | — |  |  | 50,755 |  |  | 118,364 |  |  | 169,119 |
Other | 3,075 |  |  | 2,590 |  |  | 384 |  |  | 6,049 |
Total revenues (c) | 449,980 |  |  | 1,770,592 |  |  | 120,783 |  |  | 2,341,355 |
Cost of sales and fuel (exclusive of depreciation and operating costs) | (202,170 | ) |  | (1,278,754 | ) |  | (1,539 | ) |  | (1,482,463 | )
Operating costs | (84,470 | ) |  | (89,571 | ) |  | (33,307 | ) |  | (207,348 | )
Equity in net earnings from investments | 806 |  |  | 15,268 |  |  | 28,553 |  |  | 44,627 |
Noncash compensation expense and other | (4,498 | ) |  | (6,619 | ) |  | (1,966 | ) |  | (13,083 | )
Segment adjusted EBITDA | $ | 159,648 |  |  | $ | 410,916 |  |  | $ | 112,524 |  |  | $ | 683,088 |
Depreciation and amortization | $ | (58,756 | ) |  | $ | (57,841 | ) |  | $ | (14,769 | ) |  | $ | (131,366 | )
Impairment charges | $ | (564,353 | ) |  | $ | (77,401 | ) |  | $ | — |  |  | $ | (641,754 | )
Investments in unconsolidated affiliates | $ | 4,276 |  |  | $ | 435,024 |  |  | $ | 371,179 |  |  | $ | 810,479 |
Total assets | $ | 6,374,552 |  |  | $ | 12,682,807 |  |  | $ | 2,089,362 |  |  | $ | 21,146,721 |
Capital expenditures | $ | 181,610 |  |  | $ | 746,183 |  |  | $ | 16,590 |  |  | $ | 944,383 |
(a) - Our Natural Gas Liquids segment has regulated and nonregulated operations. Our Natural Gas Liquids segment’s regulated operations had revenues of $435.1 million, of which $378.2 million related to revenues within the segment, and cost of sales and fuel of $120.4 million. (b) - Our Natural Gas Pipelines segment has regulated and nonregulated operations. Our Natural Gas Pipelines segment’s regulated operations had revenues of $73.9 million and cost of sales and fuel of $6.1 million. (c) - Intersegment revenues for the Natural Gas Gathering and Processing segment totaled $213.3 million. Intersegment revenues for the Natural Gas Liquids and Natural Gas Pipelines segments were not material.
Three Months Ended March 31, 2020 |  | Total Segments |  | Other and Eliminations |  | Total
|  | (Thousands of dollars)
Reconciliations of total segments to consolidated |  |  |  |  |  |
NGL and condensate sales |  | $ | 1,816,628 |  |  | $ | (199,472 | ) |  | $ | 1,617,156 |
Residue natural gas sales |  | 191,086 |  |  | (1,032 | ) |  | 190,054 |
Gathering, processing and exchange services revenue |  | 158,473 |  |  | — |  |  | 158,473 |
Transportation and storage revenue |  | 169,119 |  |  | (3,809 | ) |  | 165,310 |
Other |  | 6,049 |  |  | (370 | ) |  | 5,679 |
Total revenues (a) |  | $ | 2,341,355 |  |  | $ | (204,683 | ) |  | $ | 2,136,672 |
Cost of sales and fuel (exclusive of depreciation and operating costs) |  | $ | (1,482,463 | ) |  | $ | 205,535 |  |  | $ | (1,276,928 | )
Operating costs |  | $ | (207,348 | ) |  | $ | 308 |  |  | $ | (207,040 | )
Depreciation and amortization |  | $ | (131,366 | ) |  | $ | (987 | ) |  | $ | (132,353 | )
Impairment charges |  | $ | (641,754 | ) |  | $ | — |  |  | $ | (641,754 | )
Equity in net earnings from investments |  | $ | 44,627 |  |  | $ | — |  |  | $ | 44,627 |
Investments in unconsolidated affiliates |  | $ | 810,479 |  |  | $ | — |  |  | $ | 810,479 |
Total assets |  | $ | 21,146,721 |  |  | $ | 822,719 |  |  | $ | 21,969,440 |
Capital expenditures |  | $ | 944,383 |  |  | $ | 5,296 |  |  | $ | 949,679 |
(a) - Noncustomer revenue for the three months ended March 31, 2020, totaled $80.2 million related primarily to gains from derivatives on commodity contracts.
Three Months Ended March 31, 2019 | Natural Gas Gathering and Processing |  | Natural Gas Liquids (a) |  | Natural Gas Pipelines (b) |  | Total Segments
| (Thousands of dollars)
NGL and condensate sales | $ | 332,332 |  |  | $ | 2,158,103 |  |  | $ | — |  |  | $ | 2,490,435 |
Residue natural gas sales | 319,036 |  |  | — |  |  | 970 |  |  | 320,006 |
Gathering, processing and exchange services revenue | 39,742 |  |  | 98,534 |  |  | — |  |  | 138,276 |
Transportation and storage revenue | — |  |  | 52,322 |  |  | 112,865 |  |  | 165,187 |
Other | 3,551 |  |  | 2,541 |  |  | 2,565 |  |  | 8,657 |
Total revenues (c) | 694,661 |  |  | 2,311,500 |  |  | 116,400 |  |  | 3,122,561 |
Cost of sales and fuel (exclusive of depreciation and operating costs) | (450,913 | ) |  | (1,846,673 | ) |  | (1,755 | ) |  | (2,299,341 | )
Operating costs | (94,247 | ) |  | (110,438 | ) |  | (36,268 | ) |  | (240,953 | )
Equity in net earnings (loss) from investments | (1,202 | ) |  | 17,544 |  |  | 27,139 |  |  | 43,481 |
Noncash compensation expense and other | 3,945 |  |  | 5,706 |  |  | 1,132 |  |  | 10,783 |
Segment adjusted EBITDA | $ | 152,244 |  |  | $ | 377,639 |  |  | $ | 106,648 |  |  | $ | 636,531 |
Depreciation and amortization | $ | (52,681 | ) |  | $ | (46,401 | ) |  | $ | (14,156 | ) |  | $ | (113,238 | )
Investments in unconsolidated affiliates | $ | 39,749 |  |  | $ | 447,272 |  |  | $ | 463,903 |  |  | $ | 950,924 |
Total assets | $ | 6,208,883 |  |  | $ | 10,220,412 |  |  | $ | 2,138,759 |  |  | $ | 18,568,054 |
Capital expenditures | $ | 215,148 |  |  | $ | 639,338 |  |  | $ | 28,688 |  |  | $ | 883,174 |
(a) - Our Natural Gas Liquids segment has regulated and nonregulated operations. Our Natural Gas Liquids segment’s regulated operations had revenues of $323.1 million, of which $270.0 million related to sales within the segment, and cost of sales and fuel of $118.5 million. (b) - Our Natural Gas Pipelines segment has regulated and nonregulated operations. Our Natural Gas Pipelines segment’s regulated operations had revenues of $70.1 million and cost of sales and fuel of $5.6 million. (c) - Intersegment revenues for the Natural Gas Gathering and Processing segment totaled $335.8 million. Intersegment revenues for the Natural Gas Liquids and Natural Gas Pipelines segments were not material.
Three Months Ended March 31, 2019 |  | Total Segments |  | Other and Eliminations |  | Total
|  | (Thousands of dollars)
Reconciliations of total segments to consolidated |  |  |  |  |  |
NGL and condensate sales |  | $ | 2,490,435 |  |  | $ | (338,351 | ) |  | $ | 2,152,084 |
Residue natural gas sales |  | 320,006 |  |  | — |  |  | 320,006 |
Gathering, processing and exchange services revenue |  | 138,276 |  |  | — |  |  | 138,276 |
Transportation and storage revenue |  | 165,187 |  |  | (3,937 | ) |  | 161,250 |
Other |  | 8,657 |  |  | (315 | ) |  | 8,342 |
Total revenues (a) |  | $ | 3,122,561 |  |  | $ | (342,603 | ) |  | $ | 2,779,958 |
Cost of sales and fuel (exclusive of depreciation and operating costs) |  | $ | (2,299,341 | ) |  | $ | 342,964 |  |  | $ | (1,956,377 | )
Operating costs |  | $ | (240,953 | ) |  | $ | 212 |  |  | $ | (240,741 | )
Depreciation and amortization |  | $ | (113,238 | ) |  | $ | (920 | ) |  | $ | (114,158 | )
Equity in net earnings from investments |  | $ | 43,481 |  |  | $ | — |  |  | $ | 43,481 |
Investments in unconsolidated affiliates |  | $ | 950,924 |  |  | $ | — |  |  | $ | 950,924 |
Total assets |  | $ | 18,568,054 |  |  | $ | 366,271 |  |  | $ | 18,934,325 |
Capital expenditures |  | $ | 883,174 |  |  | $ | 6,531 |  |  | $ | 889,705 |
(a) - Noncustomer revenue for the three months ended March 31, 2019, totaled $22.3 million related primarily to gains from derivatives on commodity contracts.
| Three Months Ended
| March 31,
| 2020 |  | 2019
| (Thousands of dollars)
Reconciliation of net income (loss) to total segment adjusted EBITDA |  |  |
Net income (loss) | $ | (141,857 | ) |  | $ | 337,208 |
Add: |  |  |
Interest expense, net of capitalized interest | 140,616 |  |  | 115,420 |
Depreciation and amortization | 132,353 |  |  | 114,158 |
Income tax expense (benefit) | (55,395 | ) |  | 77,934 |
Impairment charges | 641,754 |  |  | — |
Noncash compensation expense | (1,302 | ) |  | 5,540 |
Other corporate costs and noncash items (a) | (33,081 | ) |  | (13,729 | )
Total segment adjusted EBITDA | $ | 683,088 |  |  | $ | 636,531 |
(a) - The three months ended March 31, 2020, includes a corporate $15.8 million gain on extinguishment of debt related to open market repurchases.

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
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