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Description of the Business and Basis of Presentation | 3 Months Ended
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Mar. 31, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract] |
Description of the Business and Basis of Presentation | DESCRIPTION OF THE BUSINESS AND BASIS OF PRESENTATION Description of the Business DT Midstream is an owner, operator, and developer of an integrated portfolio of natural gas midstream assets. The Company provides multiple, integrated natural gas services to customers through two segments: (i) Pipeline, which includes interstate pipelines, intrastate pipelines, storage systems, lateral pipelines including related treatment plants and compression and surface facilities, and (ii) Gathering, which includes gathering systems, related treatment plants, and compression and surface facilities. DT Midstream's Pipeline segment also includes joint venture interests in equity method investees which own and operate interstate pipelines that connect to DT Midstream’s wholly owned assets. DT Midstream’s core assets strategically connect key demand centers in the Midwestern U.S., Eastern Canada and Northeastern U.S. regions to the premium production areas of the Marcellus/Utica natural gas formation in the Appalachian Basin, and connect key demand centers and LNG export terminals in the Gulf Coast region to premium production areas of the Haynesville natural gas formation. Basis of Presentation The DT Midstream Consolidated Financial Statements and Notes to Consolidated Financial Statements are prepared under GAAP. These accounting principles require management to use estimates and assumptions that impact reported amounts of assets, liabilities, revenues and expenses, and the disclosure of contingent assets and liabilities. Actual results may differ from DT Midstream’s estimates. DT Midstream believes the assumptions underlying these financial statements are reasonable. Certain prior-period amounts have been reclassified to conform to current-year presentation. In DT Midstream's opinion, the accompanying unaudited Consolidated Financial Statements include all adjustments, consisting of normal recurring adjustments, necessary to present a fair statement of our financial position as of March 31, 2023, results of operations for the three months ended March 31, 2023 and 2022, statement of changes in stockholders' equity for the three months ended March 31, 2023 and 2022, and cash flows for the three months ended March 31, 2023 and 2022. The balance sheet as of December 31, 2022 was derived from audited annual financial statements but does not include all disclosures required by GAAP. Financial results for this interim period are not necessarily indicative of results that may be expected for any other interim period or for the year ending December 31, 2023. The Consolidated Financial Statements should be read in conjunction with DT Midstream Consolidated Financial Statements and Notes to Consolidated Financial Statements included in DT Midstream's 2022 Annual Report on Form 10-K. Principles of Consolidation DT Midstream consolidates all majority-owned subsidiaries and investments in entities in which we have a controlling influence. Non-majority owned investments are accounted for using the equity method of accounting when DT Midstream is able to significantly influence the operating policies of the investee. When DT Midstream does not influence the operating policies of an investee, the equity investment is measured at fair value, if readily determinable, or if not readily determinable, at cost less impairment, if applicable. DT Midstream eliminates all intercompany balances and transactions. DT Midstream evaluates whether an entity is a VIE whenever reconsideration events occur. DT Midstream consolidates VIEs for which we are the primary beneficiary. If DT Midstream is not the primary beneficiary and an ownership interest is held, the VIE is accounted for under the equity method of accounting. When assessing the determination of the primary beneficiary, DT Midstream considers all relevant facts and circumstances, including: the power, through voting or similar rights, to direct the activities of the VIE that most significantly impact the VIE's economic performance and the obligation to absorb the expected losses and/or the right to receive the expected returns of the VIE. DT Midstream performs ongoing reassessments of all VIEs to determine if the primary beneficiary status has changed. DT Midstream owns an 85% interest in the Stonewall Gas Gathering VIE and is the primary beneficiary, therefore Stonewall Gas Gathering is consolidated. DT Midstream owns a 50% interest in the South Romeo VIE and is the primary beneficiary, therefore South Romeo is consolidated. The following table summarizes the major line items in the Consolidated Statements of Financial Position for consolidated VIEs as of March 31, 2023 and December 31, 2022. All assets and liabilities of a consolidated VIE are presented where it has been determined that a consolidated VIE has either (1) assets that can be used only to settle obligations of the VIE or (2) liabilities for which creditors do not have recourse to the general credit of the primary beneficiary. The assets and liabilities of consolidated VIEs that meet the definition of a business and whose assets can be used for purposes other than the settlement of the VIEs' obligations have been excluded from the table below. Amounts for consolidated VIEs are as follows:
| March 31, |  | December 31,
| 2023 |  | 2022
| (millions)
ASSETS (a) |  |  |
Cash | $ | 3 |  |  | $ | 27 |
Accounts receivable | 9 |  |  | 9 |
Other current assets | 1 |  |  | 3 |
Intangible assets, net | 494 |  |  | 498 |
Property, plant and equipment, net | 400 |  |  | 403 |
Goodwill | 25 |  |  | 25 |
| $ | 932 |  |  | $ | 965 |
LIABILITIES (a) |  |  |
Accounts payable and other current liabilities | $ | 3 |  |  | $ | 4 |
Other noncurrent liabilities | 4 |  |  | 4 |
| $ | 7 |  |  | $ | 8 |
_____________________________________ (a)Amounts shown are 100% of the consolidated VIEs' assets and liabilities. Related Parties Transactions between DT Midstream and its equity method investees have been presented as related party transactions in the accompanying Consolidated Financial Statements. Equity Method Investments Investments in non-consolidated affiliates that are not controlled by DT Midstream, but over which we have significant influence, are accounted for using the equity method of accounting. Under the equity method, investments are recorded at historical cost as an asset and adjusted for capital contributions, dividends and distributions received, and the Company's share of the investee's earnings or losses, which are recorded as earnings from equity method investees on the Consolidated Statements of Operations. DT Midstream's equity method investments are periodically evaluated for certain factors that may be indicative of other-than-temporary impairment. As of March 31, 2023 and December 31, 2022, DT Midstream’s carrying amounts of investments in equity method investees exceeded our share of the underlying equity in the net assets of the investees by $364 million and $368 million, respectively. The difference will be amortized over the life of the underlying assets. As of March 31, 2023 and December 31, 2022, DT Midstream's consolidated retained earnings balance includes undistributed earnings from equity method investments of $11 million and $43 million, respectively. Equity method investees are described below:
|  | Investments As of |  | % Owned As of
|  | March 31, |  | December 31, |  | March 31, |  | December 31,
Equity Method Investee |  | 2023 |  | 2022 |  | 2023 |  | 2022
|  | (millions) |  |  |  |
NEXUS |  | $ | 1,294 |  |  | $ | 1,313 |  |  | 50% |  | 50%
Vector Pipeline |  | 137 |  |  | 135 |  |  | 40% |  | 40%
Millennium Pipeline |  | 740 |  |  | 752 |  |  | 52.5% |  | 52.5%
Total investments in equity method investees |  | $ | 2,171 |  |  | $ | 2,200 |  |  |  |  |
In October 2022, DT Midstream closed on the $552 million purchase of an additional 26.25% ownership interest in Millennium Pipeline from National Grid. The transaction was financed with cash on hand and available capacity under the Company's Revolving Credit Facility. The purchase constituted National Grid's full ownership interests in Millennium Pipeline, and brought DT Midstream's total ownership interest in Millennium Pipeline to 52.5%. DT Midstream accounts for its ownership interest in Millennium Pipeline under the equity method of accounting. Millennium is not a VIE and DT Midstream does not have a controlling interest due to shared control with its partner over all of Millennium's significant business activities. DT Midstream’s carrying amount of the Millennium Pipeline investment exceeded our share of the underlying equity in the net assets of the Millennium Pipeline by $343 million on the acquisition date. The following table presents summarized financial information of DT Midstream's non-consolidated equity method investees. The amounts included below represent 100% of the results of continuing operations of such entities, including the portion owned by other parties. Summarized income statement data is as follows:
| Three Months Ended |  |  |  |  |  |  |
| March 31, |  |  |
| 2023 |  | 2022 |  |  |  |  |  |  |  |  |
| (millions) |
Operating revenues | $ | 211 |  | $ | 198 |  |  |  |  |  |  |  |  |  |
Operating expenses | 94 |  | 94 |  |  |  |  |  |  |  |  |  |
Net Income | $ | 110 |  | $ | 95 |  |  |  |  |  |  |  |  |  |

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