Note 5—Inventory, Linefill and Base Gas and Long-term Inventory

Inventory, linefill and base gas and long-term inventory consisted of the following as of the dates indicated (barrels and natural gas volumes in thousands and carrying value in millions):

	September 30, 2013						December 31, 2012
		Unit of	Carrying		Price/			Unit of	Carrying		Price/
	Volumes	Measure	Value		Unit (1)		Volumes	Measure	Value		Unit (1)
Inventory
Crude oil	5,624	barrels	$	535	$	95.13	9,492	barrels	$	737	$	77.64
NGL	13,767	barrels	539		$	39.15	9,472	barrels	388		$	40.96
Natural gas	29,443	Mcf	101		$	3.43	20,374	Mcf	60		$	2.94
Other	N/A		23		N/A		N/A		24		N/A
Inventory subtotal			1,198						1,209

Linefill and base gas
Crude oil	10,520	barrels	645		$	61.31	9,919	barrels	583		$	58.78
NGL	1,345	barrels	64		$	47.58	1,400	barrels	70		$	50.00
Natural gas	17,615	Mcf	61		$	3.46	15,755	Mcf	54		$	3.43
Linefill and base gas subtotal			770						707

Long-term inventory
Crude oil	2,134	barrels	167		$	78.26	1,962	barrels	149		$	75.94
NGL	1,161	barrels	51		$	43.93	3,238	barrels	125		$	38.60
Long-term inventory subtotal			218						274

Total			$	2,186					$	2,190

(1) Price per unit of measure represents a weighted average associated with various grades, qualities and locations. Accordingly, these prices may not coincide with any published benchmarks for such products.

At the end of each reporting period we assess the carrying value of our inventory and make any adjustments necessary to reduce the carrying value to the applicable net realizable value. We recorded a non-cash charge of approximately $7 million during the three and nine months ended September 30, 2013, primarily related to the writedown of our crude oil inventory due to declines in prices during the period. During the three and nine months ended September 30, 2012, we recorded non-cash charges of approximately $7 million and $128 million, respectively, related to the writedown of our crude oil and NGL inventory due to declines in prices during the period. The recognition of these adjustments in 2013 and 2012, which are a component of “Purchases and related costs” in our accompanying condensed consolidated statements of operations, was substantially offset by the recognition of gains on derivative instruments being utilized to hedge the future sales of our crude oil and NGL inventory. Substantially all of such gains were recorded to “Supply and Logistics segment revenues” on our condensed consolidated statements of operations. See note 11 for discussion of our derivative and risk management activities.