Reporting Segments | Our operations are located in the United States. We are organized into three reporting segments: (1) Crude Oil Transportation & Logistics, (2) Natural Gas Transportation & Logistics, and (3) Processing & Logistics. Crude Oil Transportation & Logistics The Crude Oil Transportation & Logistics segment is engaged in the ownership and operation of the Pony Express System, which is a FERC-regulated crude oil pipeline serving the Bakken Shale and other nearby oil producing basins. The mainline portion of the Pony Express System was placed in service in October 2014. The Pony Express System also includes a lateral pipeline in Northeast Colorado, which interconnects with the Pony Express System just east of Sterling, Colorado and was placed in service in the second quarter of 2015. Natural Gas Transportation & Logistics The Natural Gas Transportation & Logistics segment is engaged in the ownership and operation of FERC-regulated interstate natural gas pipelines and integrated natural gas storage facilities that provide services to on-system customers (such as third-party LDCs), industrial users and other shippers. The Natural Gas Transportation & Logistics segment includes our 25% membership interest in Rockies Express effective May 6, 2016, as discussed in Note 3 – Acquisitions . Processing & Logistics The Processing & Logistics segment is engaged in the ownership and operation of natural gas processing, treating and fractionation facilities that produce NGLs and residue gas that is sold in local wholesale markets or delivered into pipelines for transportation to additional end markets, as well as water business services provided primarily to the oil and gas exploration and production industry and the transportation of NGLs. Corporate and Other Corporate and Other includes corporate overhead costs that are not directly associated with the operations of our reportable segments, such as interest and fees associated with our revolving credit facility, public company costs, and equity-based compensation expense. These segments are monitored separately by management for performance and are consistent with internal financial reporting. These segments have been identified based on the differing products and services, regulatory environment and the expertise required for their respective operations. We consider Adjusted EBITDA our primary segment performance measure as we believe it is the most meaningful measure to assess our financial condition and results of operations as a public entity. We define Adjusted EBITDA, a non-GAAP measure, as net income excluding the impact of interest, income taxes, depreciation and amortization, non-cash income or loss related to derivative instruments, non-cash long-term compensation expense, impairment losses, gains or losses on asset or business disposals or acquisitions, gains or losses on the repurchase, redemption or early retirement of debt, and earnings from unconsolidated investments, but including the impact of distributions from unconsolidated investments. The following tables set forth our segment information for the periods indicated: Three Months Ended June 30, 2016 Three Months Ended June 30, 2015 Revenue: Total Inter- External Total Inter- External (in thousands) Crude Oil Transportation & Logistics $ 93,470 $ — $ 93,470 $ 75,219 $ — $ 75,219 Natural Gas Transportation & Logistics 30,150 (1,410 ) 28,740 30,969 (1,344 ) 29,625 Processing & Logistics 24,721 — 24,721 28,126 — 28,126 Corporate and Other — — — — — — Total Revenue $ 148,341 $ (1,410 ) $ 146,931 $ 134,314 $ (1,344 ) $ 132,970 Six Months Ended June 30, 2016 Six Months Ended June 30, 2015 Revenue: Total Inter- External Total Inter- External (in thousands) Crude Oil Transportation & Logistics $ 188,042 $ — $ 188,042 $ 125,600 $ — $ 125,600 Natural Gas Transportation & Logistics 61,137 (2,765 ) 58,372 64,579 (2,690 ) 61,889 Processing & Logistics 45,922 — 45,922 60,156 — 60,156 Corporate and Other — — — — — — Total Revenue $ 295,101 $ (2,765 ) $ 292,336 $ 250,335 $ (2,690 ) $ 247,645 Three Months Ended June 30, 2016 Three Months Ended June 30, 2015 Adjusted EBITDA: Total Inter- External Total Inter- External (in thousands) Crude Oil Transportation & Logistics $ 65,760 $ 1,346 $ 67,106 $ 46,320 $ 1,344 $ 47,664 Natural Gas Transportation & Logistics 45,763 (1,410 ) 44,353 16,591 (1,344 ) 15,247 Processing & Logistics 3,549 64 3,613 7,077 — 7,077 Corporate and Other (1,089 ) — (1,089 ) (1,036 ) — (1,036 ) Reconciliation to Net Income: Add: Equity in earnings of unconsolidated investment 23,321 — Less: Interest expense, net of noncontrolling interest (9,233 ) (3,893 ) Depreciation and amortization expense, net of noncontrolling interest (21,840 ) (18,302 ) Distributions from unconsolidated investment (29,656 ) — Non-cash gain (loss) related to derivative instruments, net of noncontrolling interest 18,791 (131 ) Non-cash compensation expense (1,469 ) (1,727 ) Non-cash loss from disposal of assets (1,849 ) — Net income attributable to partners $ 92,048 $ 44,899 Six Months Ended June 30, 2016 Six Months Ended June 30, 2015 Adjusted EBITDA: Total Inter- External Total Inter- External (in thousands) Crude Oil Transportation & Logistics $ 130,301 $ 2,691 $ 132,992 $ 71,826 $ 2,690 $ 74,516 Natural Gas Transportation & Logistics 62,915 (2,765 ) 60,150 35,837 (2,690 ) 33,147 Processing & Logistics 6,900 74 6,974 15,795 — 15,795 Corporate and Other (2,441 ) — (2,441 ) (1,671 ) — (1,671 ) Reconciliation to Net Income: Add: Equity in earnings of unconsolidated investment 23,321 — Non-cash loss allocated to noncontrolling interest — 9,377 Less: Interest expense, net of noncontrolling interest (16,732 ) (7,333 ) Depreciation and amortization expense, net of noncontrolling interest (43,807 ) (38,835 ) Distributions from unconsolidated investment (29,656 ) — Non-cash gain (loss) related to derivative instruments, net of noncontrolling interest 9,801 (41 ) Non-cash compensation expense (2,635 ) (3,254 ) Non-cash loss from disposal of assets (1,849 ) (4,483 ) Net income attributable to partners $ 136,118 $ 77,218 Six Months Ended June 30, Capital Expenditures: 2016 2015 (in thousands) Crude Oil Transportation & Logistics $ 19,160 $ 32,501 Natural Gas Transportation & Logistics 4,115 7,061 Processing & Logistics 5,216 9,982 Corporate and Other — — Total capital expenditures $ 28,491 $ 49,544 Assets: June 30, 2016 December 31, 2015 (in thousands) Crude Oil Transportation & Logistics $ 1,425,917 $ 1,439,418 Natural Gas Transportation & Logistics 1,142,222 706,576 Processing & Logistics 408,055 409,795 Corporate and Other 63,725 6,285 Total assets $ 3,039,919 $ 2,562,074 |