What changed in this filing

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Item 1. Business

2022-06-06 compared with 2021-06-03 · 145 added, 176 removed, 420 unchanged (43% of the section changed)

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Originally formed in September 2010, we are a Delaware master limited partnership and our business is currently organized into the following three segments:

• Our Water Solutions segment transports, treats, recycles and disposes of produced and flowback water generated from oil and natural gas production.

We also sell produced water for reuse and brackish non-potable water to our producer customers to be used in their crude oil exploration and production activities.

• Our Water Solutions segment transports, treats, recycles and disposes of produced and flowback water generated from crude oil and natural gas production.

We also sell produced water for reuse and recycle and brackish non-potable water to our producer customers to be used in their crude oil exploration and production activities.

As part of processing water, we aggregate and sell recovered crude oil, also known as skim oil.

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• Our Crude Oil Logistics segment purchases crude oil from producers and marketers and transports it to refineries or for resale at pipeline injection stations, storage terminals, barge loading facilities, rail facilities, refineries, and other trade hubs, and provides storage, terminaling and transportation services through its owned assets.

Our activities in this segment are supported by certain long-term, fixed rate contracts which include minimum volume commitments on our pipelines.

• Our Liquids Logistics segment (formerly named Liquids and Refined Products) conducts supply operations for natural gas liquids, refined petroleum products and biodiesel to a broad range of commercial, retail and industrial customers across the United States and Canada.

These operations are conducted through our 28 company-owned terminals, third-party storage and terminal facilities, common carrier pipelines and a fleet of leased railcars.

We also provide marine exports of butane through our facility located in Chesapeake, Virginia.

Debt Refinancing

On February 4, 2021, we closed on a private offering of $2.05 billion of 7.5% senior secured notes due 2026 (“2026 Senior Secured Notes”) and a new credit agreement (the “New Credit Agreement”) which consists of a $500.0 million asset-based revolving credit facility (“ABL Facility”).

We used the net proceeds from the issuance of the 2026 Senior Secured Notes (along with borrowings under the ABL Facility) to (i) repay all outstanding borrowings under and terminate our existing revolving credit facility, (ii) repay all outstanding borrowings under and terminate our term credit agreement and (iii) pay fees and expenses in connection therewith, as well as fees and expenses in connection with the issuance of the 2026 Senior Secured Notes and entering into the ABL Facility.

As part of this refinancing, we also agreed to certain restricted payment provisions under the 2026 Senior Secured Notes and ABL Facility, one of which is the suspension of the quarterly common unit distributions, beginning with the quarter ended December 31, 2020, and all preferred unit distributions, beginning with the quarter ended March 31, 2021.

The cash savings from the suspension of the distributions should accelerate the deleveraging of our balance sheet and increase our liquidity, which should create more financial flexibility going forward.

For additional information related to the ABL Facility and 2026 Senior Secured Notes, see Note 8 to our consolidated financial statements included in this Annual Report.

Our activities in this segment are supported by certain long-term, fixed rate contracts which include minimum volume commitments on our owned and leased pipelines.

• Our Liquids Logistics segment conducts supply operations for natural gas liquids, refined petroleum products and biodiesel to a broad range of commercial, retail and industrial customers across the United States and Canada.

These operations are conducted through our 24 owned terminals, third-party storage and terminal facilities, nine common carrier pipelines and a fleet of leased railcars.

We also provide services for marine exports of butane through our facility located in Chesapeake, Virginia, and expect to commence operations on our propane pipeline in Michigan in June 2022.

Business Repositioning

Over the past several years, we have undertaken a number of important strategic actions in an effort to leverage the Partnership’s core areas of competitive strength and focus on generating stable, growing and predictable cash flows, while improving our credit profile.

These steps included the following:

Sale of Retail Propane Segment

• On March 30, 2018, we sold a portion of our Retail Propane segment to DCC LPG (“DCC”);

• On July 10, 2018, we sold virtually all of our remaining Retail Propane segment to Superior Plus Corp.

(“Superior”);

• On August 14, 2018, we sold our 50% interest in Victory Propane, LLC, the only remaining portion of this segment.

Sale of Non-Core Assets in our Water Solutions Segment

• On November 30, 2018, we sold NGL Water Solutions Bakken, LLC to an affiliate of Tallgrass Energy, LP.

The divested assets included five saltwater disposal wells located in McKenzie and Dunn Counties, North Dakota.

• On February 28, 2019, we sold our South Pecos water disposal business to a subsidiary of WaterBridge Resources LLC.

The divested assets included nine saltwater disposal facilities located near the town of Pecos, Texas in southern Reeves and Ward counties.

Sale of Certain Refined Products Businesses

• On September 30, 2019, we sold TransMontaigne Product Services, LLC (“TPSL”) and associated assets to Trajectory Acquisition Company, LLC (“Trajectory”).

The divested assets included the following:

• TPSL Terminaling Services Agreement with TransMontaigne Partners LP, including the exclusive rights to utilize 19 terminals;

• Line space along Colonial and Plantation Pipelines;

• Two wholly-owned refined products terminals in Georgia and multiple third-party throughput agreements;

• Customer contracts, inventory and other working capital associated with the assets.

• On January 3, 2020, we sold our refined products marketing business in the mid-continent region of the United States (“Mid-Con”) to a third-party.

• On March 30, 2020, we sold our gas blending business in the southeastern and eastern regions of the United States (“Gas Blending”) to another third-party.

• We retained certain refined products and biodiesel businesses, which are included within our Liquids Logistics segment.

Purchase of Natural Gas Liquids Terminals

• In March 2019, we acquired the natural gas liquids terminal business of DCP Midstream, LP.

The assets acquired included the following:

• Five propane rail terminals located in the Eastern United States;

• 50% ownership interest in an additional rail terminal located in Maine;

• An import/export terminal located in Chesapeake, Virginia.

Purchase of Strategic Water Infrastructure Assets in the Delaware Basin

• On July 2, 2019, we acquired all of the assets of Mesquite Disposals Unlimited, LLC (“Mesquite”).

The acquired assets included the following:

• 34 saltwater disposal wells;

• A fully interconnected produced water pipeline transportation and disposal system in Eddy and Lea Counties, New Mexico, and Loving County, Texas spanning approximately 175 miles;

• Long-term acreage dedications and minimum volume commitment contracts.

• On October 31, 2019, we acquired all of the equity interests of Hillstone Environmental Partners, LLC (“Hillstone”).

The acquired assets included the following:

• 19 saltwater disposal wells representing approximately 580,000 barrels per day of permitted disposal capacity;

• approximately 70 miles of a newly-built network of water pipelines, with approximately 680,000 barrels per day of transportation capacity;

• 22 permits to develop another 660,000 barrels per day of disposal capacity;

• Long-term acreage dedications and minimum volume commitment contracts.

The sale of our Retail Propane segment and a substantial portion of our former Refined Products and Renewables segment has allowed us to reduce working capital indebtedness and decrease earnings volatility.

The purchase of the natural gas liquids terminals complements our existing natural gas liquids portfolio, provides strategic access to water for international import and export activity and also creates additional opportunities for new and existing customers to supply their business.

The purchase of the two strategic water infrastructure assets assists in furthering our ongoing strategy of cash flow predictability by adding long-term contracts under acreage dedications and minimum volume commitments and provide us with significant scale and capabilities that will facilitate high-quality execution for our customers.

We believe these actions have substantially simplified our business mix and has allowed us to focus on what we believe are the core areas of our business and improved our overall financial position.

These transactions are expected to better position us for sustained growth in the future.

These steps included the sale of the following:

• Our Retail Propane segment during the years ended March 31, 2018 and 2019;

• Certain non-core water disposal businesses in the Permian and Bakken Basins during the year ended March 31, 2019;

• Certain refined products businesses including TransMontaigne Product Services, LLC (“TPSL”), our refined products business in the mid-continent region of the United States (“Mid-Con”) and our gas blending business in the southeastern and eastern regions of the United States (“Gas Blending”) during the year ended March 31, 2020;

• Our interest in Sawtooth Caverns, LLC (“Sawtooth”) during the year ended March 31, 2022.

In our Water Solutions segment we acquired strategic water infrastructure assets including Mesquite Disposals Unlimited, LLC (“Mesquite”) and the equity interests of Hillstone Environmental Partners, LLC (“Hillstone”) during the year ended March 31, 2020, while in our Liquids Logistics segment, we acquired DCP Midstream LP’s natural gas liquids business during the year ended March 31, 2019 and an approximately 225-mile propane pipeline in Michigan (the “Ambassador Pipeline”) during the year ended March 31, 2021.

The sales of our Retail Propane segment and TPSL, Mid-Con and Gas Blending have allowed us to reduce working capital indebtedness and decrease earnings volatility.

The purchase of the two strategic water infrastructure assets assists in furthering our ongoing strategy of cash flow predictability by adding long-term contracts under acreage dedications and minimum volume commitments and provides us with significant scale and capabilities that will facilitate high-quality execution for our customers.

The purchase of the natural gas liquids terminals and the Ambassador Pipeline complement our existing natural gas liquids portfolio, provides strategic access to water for international import and export activity and also creates additional opportunities for new and existing customers to supply their business.

We believe these collective actions have substantially simplified our business mix and has allowed us to focus on what we believe are the core areas of our business and improved our overall financial position.

These transactions are expected to position us for sustained growth in the future.

For more information regarding our results of operations and reportable segments, see Part II, Item 7–“Management’s Discussion and Analysis of Financial Condition and Results of Operations” and Note 11 to our consolidated financial statements included in this Annual Report.

For more information regarding our dispositions and the impact to our operations, see Note 18 and Note 19 to our consolidated financial statements included in this Annual Report and our Annual Report on Form 10-K for the ye ar ended March 31, 2020 .

For more information regarding our dispositions and acquisitions transactions and the impact to our operations, see Note 17 and Note 18 to our consolidated financial statements included in this current Annual Report and our Annual Report on Form 10-K for the years ended March 31, 2021 and 2020 .

Debt Refinancing

As previously disclosed, on February 4, 2021, we closed on a private offering of $2.05 billion of 7.5% senior secured notes due 2026 (“2026 Senior Secured Notes”) and a new credit agreement which consisted of a $500.0 million asset-based revolving credit facility (“ABL Facility”).

We used the net proceeds from the issuance to repay all outstanding borrowings under and terminate our former revolving credit facility and our term credit agreement, as well as to pay fees and expenses.

As part of this refinancing, we also agreed to certain restricted payment provisions under the 2026 Senior Secured Notes and ABL Facility, one of which was the suspension of the quarterly common unit distributions, which began with the quarter ended December 31, 2020, and all preferred unit distributions, which began with the quarter ended March 31, 2021.

On April 13, 2022, we amended the ABL Facility to increase the commitments to $600.0 million under the accordion feature within the ABL Facility.

As part of the amendment, we agreed to reduce the commitments back to $500.0 million on or before March 31, 2023.

For additional information related to the ABL Facility and 2026 Senior Secured Notes, see Note 7 to our consolidated financial statements included in this Annual Report.

Primary Service Areas

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The following chart provides a summarized overview of our legal entity structure at March 31, 2022:

(1) Includes (i) NGL Water Solutions, LLC, which includes the operations of our Water Solutions business, (ii) NGL Crude Logistics, LLC, which includes the operations of our Crude Oil Logistics business and certain businesses within our Liquids Logistics segment and (iii) NGL Liquids, LLC, which includes the operations of certain of our businesses within our Liquids Logistics segment.

(1) Includes (i) NGL Water Solutions, LLC, which includes the operations of our Water Solutions segment, (ii) NGL Crude Logistics, LLC, which includes the operations of our Crude Oil Logistics segment and certain of our businesses within our Liquids Logistics segment and (iii) NGL Liquids, LLC, which includes the operations of certain of our businesses within our Liquids Logistics segment.

Our Business Strategies

Our principal business objectives are to maximize the profitability and stability of our businesses, grow our businesses in an accretive and prudent manner, and maintain a strong balance sheet.

We intend to accomplish these objectives by executing the following strategies:

We intend to accomplish these business objectives by executing the following strategies:

• Prudently manage our balance sheet to provide us with maximum financial flexibility for funding our operations, capital projects and strategic acquisitions.

Our primary focus is to reduce our absolute debt and leverage and maintain sufficient liquidity to reduce our overall leverage below 4.75 to 1.00 and reinstate the payment of distributions.

We are also focused on maintaining credit metrics to manage existing and future capital requirements as well as to take advantage of market opportunities.

We expect to continue to evaluate the capital markets and may opportunistically pursue financing transactions to optimize our capital structure.

• Focus on building a diversified midstream master limited partnership providing multiple services to customers.

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We seek to continue to increase cash flows that are supported by certain fixed fee, multi-year contracts, some of which include acreage dedications from producers or minimum volume commitments.

• Prudently manage our balance sheet to provide us with maximum financial flexibility for funding our operations, capital projects and strategic acquisitions.

We will seek to maintain sufficient liquidity and credit metrics to manage existing and future capital requirements and to take advantage of market opportunities.

We expect to continue to evaluate the capital markets and may opportunistically pursue financing transactions to optimize our capital structure.

• Achieve growth by investing in new assets, customers and ventures that increase volumes, enhance our operations, and generate attractive rates of return .

We have invested and expect to continue to invest within our existing businesses to capitalize on accretive, organic growth opportunities.

• Achieve growth by utilizing our existing footprint of assets, investing in new assets, customers and ventures that increase volume and enhance our operations, and generate attractive rates of return .

We have available capacity in many of the assets that we own and operate that can be utilized to increase cash flows with minimal incremental capital investment.

We have invested and expect to continue to invest within our existing businesses to capitalize on accretive, organic growth opportunities.

We also continue to pursue strategic transactions and ventures that complement and enhance our existing footprint.

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• Our water processing facilities, which are strategically located near areas of high crude oil and natural gas production .

Our water processing facilities are located among the most prolific crude oil and natural gas producing areas in the United States, including the Delaware Basin, the Midland Basin, the DJ Basin and the Eagle Ford Basin.

In addition, we believe that the technological capabilities of our Water Solutions business can be quickly implemented at new facilities and locations.

These assets are also underpinned by long-term, fixed fee contracts and acreage dedications, some of which contain minimum volume commitments.

These assets are underpinned by long-term, fixed fee contracts and acreage dedications, some of which contain minimum volume commitments.

Additionally, we believe that the technological capabilities of our Water Solutions business can be quickly implemented at new facilities and locations as needed.

Our system located in the Northern Delaware Basin is an integrated network of large diameter produced water pipelines, recycling facilities and disposal wells that collectively provides reliable service to producer customers and would be difficult for competitors to replicate at this time.

• Our network of crude oil transportation and storage assets, which allows us to serve customers over a wide geographic area and optimize sales.

Our strategically deployed terminals, towboats, barges, trucks, and our owned and contracted pipeline capacity, provide access to a wide range of customers and markets.

Our strategically deployed terminals, towboats and barges, as well as our owned and contracted pipeline capacity, provide access to a wide range of customers and markets.

We use this expansive network of transportation assets to deliver crude oil to optimal markets.

These operations are supported by certain long-term, fixed rate contracts with producers, refiners and marketers and include minimum volume commitments on our pipelines.

These operations are supported by certain long-term, fixed rate contracts with producers, refiners and marketers and include minimum volume commitments on our owned and leased pipelines.

• Our network of natural gas liquids transportation, terminal, and storage assets, which allows us to provide multiple services across the United States and Canada.

Our strategically located terminals, large leased railcar fleet, shipper status on common carrier pipelines, and substantial leased and owned underground storage, enable us to be a preferred purchaser and seller of natural gas liquids.

Our strategically located terminals, large leased railcar fleet, shipper status on common carrier pipelines, and substantial leased storage enable us to be a preferred

purchaser and seller of natural gas liquids.

We have a diverse base of long-standing customers and believe that our performance metrics allow us to reliably supply, store and transport products throughout the United States and Canada.

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Our ability to provide multiple services to customers in numerous geographic areas enhances our competitive position.

Our three business units are diversified by geography, customer base and commodity sensitivities, which we believe provides us with more stable cash flows through the typical commodity cycles.

Our three business segments are diversified by geography, customer base and commodity sensitivities, which we believe provides us with more stable cash flows through the typical commodity cycles.

• Our seasoned management team with extensive midstream industry experience and a track record of acquiring, integrating, operating and growing successful businesses.

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Water Solutions

Our Water Solutions segment transports, treats, recycles and disposes of produced and flowback water generated from oil and natural gas production.

We also sell produced water for reuse and brackish non-potable water to our producer customers to be used in their crude oil exploration and production activities.

Our Water Solutions segment transports, treats, recycles and disposes of produced and flowback water generated from crude oil and natural gas production.

We also sell produced water for reuse and recycle and brackish non-potable water to our producer customers to be used in their crude oil exploration and production activities.

As part of processing water, we aggregate and sell recovered crude oil, also known as skim oil.

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Our activities in this segment are underpinned by long-term, fixed fee contracts and acreage dedications, some of which contain minimum volume commitments with leading oil and gas companies including large, investment grade producer customers.

We operate in a number of the most prolific crude oil and natural gas producing areas including the Delaware Basin in New Mexico and Texas, the Midland Basin in Texas, the DJ Basin in Colorado and the Eagle Ford Basin in Texas.

We operate in a number of the most prolific crude oil and natural gas producing areas in the United States including the Delaware Basin in New Mexico and Texas, the Midland Basin in Texas, the DJ Basin in Colorado and the Eagle Ford Basin in Texas.

With a system that handled approximately 656.2 million barrels of produced water across its areas of operation during the year ended March 31, 2022, we believe that we are the largest independent produced water transportation and disposal company in the United States.

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Our core asset in the Water Solutions segment is our system located in the Northern Delaware Basin, where we own and operate the largest integrated network of large diameter produced water pipelines, recycling facilities and disposal wells.

This system spans six counties in New Mexico and Texas that represent one of the most prolific crude oil producing regions in the United States with some of the most economic hydrocarbon resource and lowest break-even economics for producers.

This system has over 620 miles of newly-built, in-service large diameter produced water pipelines connected to 58 active saltwater disposal facilities and 119 active disposal wells.

Our system has approximately 650 miles of newly-built, in-service large diameter produced water pipelines connected to 58 active saltwater disposal facilities and 122 active disposal wells.

We have over 660,000 acres dedicated to the Northern Delaware system providing a multi-decade drilling inventory and significant growth opportunity.

These assets are substantially supported by long-term, fixed-fee contracts underpinned by major acreage dedications or minimum volume commitments.

Our Water Solutions segment also disposes of solids employing specialized equipment at select facilities in the Eagle Ford Basin, the Delaware Basin, the Midland Basin and the DJ Basin.

This capability enables us to accept and dispose of solids such as tank bottoms, drilling fluids and drilling muds generated by crude oil and natural gas exploration and production activities.

Our facilities will accept only exploration and production exempt waste allowed under our permits.

We own or have a possessory interest in over 120,000 acres of real estate on two ranches located in Eddy and Lea Counties, New Mexico, which we acquired during the year ended March 31, 2019.

We purchased the real estate to secure royalty free locations to grow our produced water business and develop pipeline infrastructure.

We own or have a possessory interest in over 120,000 acres of real estate on two ranches located in Eddy and Lea Counties, New Mexico.

Our two ranches include 16 commercial water permits and four strategically located brackish non-potable water facilities (including 45 brackish non-potable water wells).

Additionally, on both ranches we are organically developing surface mineral mining operations, solid waste facilities, and are exploring other uses for our real estate holdings.

In February 2022, our Water Solutions segment announced a collaboration with XRI Holdings, LLC (“XRI”) to advance full cycle produced water management across operations in the Northern Delaware Basin.

This collaboration will benefit from each of our unique characteristics by leveraging existing infrastructure assets, technology, and experience, as we own and operate the largest integrated produced water pipeline system in the Northern Delaware Basin and XRI is the largest produced water recycling company in the Permian Basin, allowing us the opportunity to address the greatly increasing demand for sustainable use of produced water in our customers’ completions activities.

The flexible, non-exclusive nature of this joint effort allows each of us to continue to operate produced water reuse and recycling activities independent of one another.

the year ended March 31, 2022, we sold approximately 34.1 million barrels of recycled water, which includes the sale of produced water and recycled water for use in our customers’ completion activities.

We own 111 water treatment and disposal facilities, including 212 injection wells.

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Midland Basin (3) - Texas 14 14 358,300 — 358,300

Eagle Ford (3)(4) - Texas 24 38 594,000 362,000 956,000

Eagle Ford Basin (3)(4) - Texas 22 36 549,000 362,000 911,000

DJ Basin - Colorado 13 32 393,000 162,500 555,500

Granite Wash (3) - Texas 2 3 60,000 — 60,000

Pinedale Anticline (5) - Wyoming 1 4 — 72,765 72,765

Pinedale Anticline Basin (5) - Wyoming 1 4 — 90,240 90,240

Eaglebine - Texas 1 1 20,000 — 20,000

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Our customers bring produced and flowback water generated by crude oil and natural gas exploration and production operations to our facilities for treatment through pipeline gathering systems and by truck.

We expect that our pipeline delivered volumes will continue to increase as new projects come on line.

During the year ended March 31, 2022, in the Delaware Basin we received approximately 98% of produced and flowback water via pipelines.

Once we take delivery of the water, the level of processing is determined by the ultimate disposition of the water.

Our facilities in Colorado, Texas and New Mexico dispose of produced water primarily into deep underground formations via injection wells.

Our facilities in Colorado, New Mexico and Texas dispose of produced water primarily into deep underground formations via injection wells.

At our disposal facilities, we use proprietary well maintenance programs to enhance injection rates and extend the service lives of the wells.

Our facility servicing the Pinedale Anticline in Wyoming has the assets and technology needed to treat the water more extensively than a typical disposal facility.

Our facility servicing the Pinedale Anticline Basin in Wyoming has the assets and technology needed to treat the water more extensively than a typical disposal facility.

At this facility, we have the option of disposing of the water in underground injection wells or recycling the water.

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The primary customers of our operations consist mainly of large publicly traded, oil and gas companies with diversified acreage positions across multiple leading oil and gas plays.

During the year ended March 31, 2021, 75% of the water treatment and disposal revenues of our Water Solutions segment were generated from our ten largest customers of the segment.

During the year ended March 31, 2022, 69% of the revenues of our Water Solutions segment were generated from our ten largest customers of the segment.

The principal elements of competition are system reliability, project execution capability and reputation, system capacity and flexibility, rates for services and system location relative to the producer’s operations.

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We charge customers a fee per barrel of produced water received.

Our contractual agreements consist of:

Our contractual agreements can consist of:

(a) minimum volume commitments requiring the customer to deliver a specified minimum volume of produced water over a specified period of time;

(b) acreage dedications requiring the customer to deliver all volumes from the dedicated acreage with us;

(b) acreage dedications requiring the customer to deliver all volumes produced from the dedicated acreage with us;

and (c) produced water pipeline and trucked disposal agreements providing interruptible service in exchange for a fee per barrel of produced water received.

We also generate revenue from the sale of crude oil we recover in processing the produced water.

In addition, we may charge pipeline transportation fees, pipeline interconnection fees, solids disposal fees and fees for the sale of produced water for reuse by our customers.

We also generate revenue from the sale of crude oil we recover in

processing the produced water.

In addition, we may charge fees for the sale of produced water for reuse by our customers, pipeline transportation fees, pipeline interconnection fees and solids disposal fees.

Our Water Solutions segment operates primarily under the NGL Water Solutions and Anticline Disposal trade names.

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Our Crude Oil Logistics segment purchases crude oil from producers and marketers and transports it to refineries or for resale at pipeline injection stations, storage terminals, barge loading facilities, rail facilities, refineries, and other trade hubs, and provides storage, terminaling and transportation services through its owned assets.

Our activities in this segment are supported by certain long-term, fixed rate contracts which include minimum volume commitments on our pipelines.

Our activities in this segment are supported by certain long-term, fixed rate contracts which include minimum volume commitments on our owned and leased pipelines.

Our operations are concentrated in and around four prolific crude oil producing regions in the United States - the DJ Basin in Colorado, the Permian Basin in Texas and New Mexico, the Eagle Ford Basin in Texas and the United States Gulf Coast.

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The main line portion of this pipeline is comprised of an undivided interest with Saddlehorn Pipeline Company, LLC (“Saddlehorn”) in which we have the right to use 150,000 barrels per day of capacity of the pipeline.

During the year ended March 31, 2021, approximately 32.8 million financial barrels (volume amounts are from both internal and external parties) of crude were transported on the Grand Mesa Pipeline.

During the year ended March 31, 2022, approximately 28.4 million barrels (volume amounts are from both internal and external parties) of crude oil were transported on the Grand Mesa Pipeline.

Operating costs associated with Grand Mesa are allocated to us based on our proportionate ownership interest and throughput.

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We retained ownership of our previously acquired easements for the potential future development of transportation projects involving petroleum commodities other than crude oil and condensate.

With the consent and participation of Saddlehorn, we and Saddlehorn may consider future opportunities using these easements for projects involving the transportation of crude oil and condensate.

With the consent and participation of Saddlehorn, we and Saddlehorn may consider future opportunities using these easements, to the extent such easements remain in effect, for projects involving the transportation of crude oil and condensate.

We own and operate a large scale crude oil terminal located in Cushing, Oklahoma with 3,626,000 barrels of storage capacity, seven off-loading lease automatic custody transfer units (“LACTs”), a full control room, on-site laboratory, and three 24-inch bi-directional pipelines each capable of moving 360,000 barrels per day.

The terminal features advantaged connectivity to other terminals and pipelines including important connections to our Grand Mesa Pipeline and TransCanada’s terminal with access to the United States Gulf Coast via Marketlink.

Similarly, the terminal connects at Cushing to the Glass Mountain Pipeline which feeds two major mid-continent refineries.

The terminal is situated on 200 acres and is designed to be expanded based on customer demand.

The terminal features advantaged connectivity to other terminals and pipelines including important connections to our Grand Mesa Pipeline and to TC Energy’s terminal with access to the United States Gulf Coast via Marketlink.

Our terminal is situated on 200 acres and is designed to be expanded based on customer demand.

Cushing is one of the most liquid crude oil trading hubs in the world and is the delivery point for the West Texas Intermediate futures contracts.

We own and operate a crude oil marine terminal in Point Comfort, Texas with 355,000 barrels of storage capacity, six off-loading LACTs and three docks (two for ocean-going barges and ships and one for inland barges).

We own and operate a crude oil pipeline and marine terminal in Houma, Louisiana with 288,000 barrels of storage capacity, two off-loading LACTs, a brown water barge dock and two bi-directional pipelines each capable of moving 120,000 barrels per day with connectivity to Shell’s Zydeco System.

We own and operate a crude oil pipeline and marine terminal in Houma, Louisiana with 288,000 barrels of storage capacity, two off-loading LACTs, a brown water barge dock and two 12-inch bi-directional pipelines each capable of moving 120,000 barrels per day with connectivity to Shell’s Zydeco System.

We purchase crude oil from producers and marketers and transport it to refineries or for resale.

Our strategically deployed terminals, towboats, barges, trucks, and our owned and contracted pipeline capacity, provide access to a wide range of customers and markets.

Our strategically deployed terminals, towboats and barges, as well as our owned and contracted pipeline capacity, provide access to a wide range of customers and markets.

We use this expansive network of transportation assets to deliver crude oil to optimal markets.

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• The Grand Mesa Pipeline, which is described above, and 20 other common carrier pipelines owned by third parties;

• 131 owned trucks and 214 owned trailers operating primarily in the Mid-Continent, Permian Basin, Eagle Ford Basin, and Rocky Mountain regions;

• 396 owned and 210 leased railcars (all of which are leased or subleased to third parties);

• 13 owned towboats and 24 owned barges operating primarily in the intercoastal waterways of the United States Gulf Coast and along the Mississippi and Arkansas River systems.

We purchased an additional barge in April 2022.

All of our 396 owned railcars and 210 leased railcars are compliant with the standards for railcars built subsequent to 2011 for the commodities they are transporting.

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Our customers include crude oil refiners, producers, and marketers.

During the year ended March 31, 2021, 78% of the revenues of our Crude Oil Logistics segment were generated from our ten largest customers of the segment.

During the year ended March 31, 2022, 90% of the revenues of our Crude Oil Logistics segment were generated from our ten largest customers of the segment, of which CITGO Petroleum Corporation accounted for 12.8% of our consolidated revenues for the year ended March 31, 2022.

Sales to this customer occur mainly out of our crude oil terminal in Cushing, Oklahoma.

Additionally, certain key customers of the Crude Oil Logistics segment contribute significantly to the cash flows and profitability of the organization.

Any loss of those customers or their contracts could have an adverse impact on our financial results.

Our Crude Oil Logistics business faces significant competition, as many entities are engaged in the crude oil logistics business, some of which are larger and have greater financial resources than we do.

Our Crude Oil Logistics segment faces significant competition, as many entities are engaged in the crude oil logistics business, some of which are larger and have greater financial resources than we do.

The primary factors on which we compete are:

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• open credit;

• logistics capabilities, including the availability of railcars, proprietary terminals, and owned pipelines, barges, railcars, trucks, and towboats;

• logistics capabilities, including the availability of railcars, proprietary terminals, and owned pipelines, barges, railcars and towboats;

• long-term customer relationships.

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Crude oil markets can either be in contango (a condition in which forward crude oil prices are greater than spot prices) or can be in backwardation (a condition in which forward crude oil prices are lower than spot prices).

Our Crude Oil Logistics business benefits when the market is in contango, as increasing prices result in inventory holding gains during the time between when we purchase inventory and when we sell it.

Our Crude Oil Logistics segment benefits when the market is in contango, as increasing prices result in inventory value gains during the time between when we purchase the inventory and when we sell it.

In addition, we are able to better utilize our storage assets when contango markets justify storing barrels.

When markets are in backwardation, falling prices typically have an unfavorable impact on our storage tank lease rates.

When markets are in

backwardation, our inventory values decrease during the time period between when we purchase inventory and when we sell it and the declining prices also typically have an unfavorable impact on our storage tank lease rates.

To help mitigate the impact of changing prices, we enter into derivative instruments to hedge our inventory.

Our Crude Oil Logistics segment operates primarily under the NGL Crude Logistics, NGL Crude Transportation, NGL Marine, NGL Crude Terminals and NGL Crude Cushing trade names.

Liquids Logistics

Our Liquids Logistics segment (formerly named Liquids and Refined Products) conducts supply operations for natural gas liquids, refined petroleum products and biodiesel to a broad range of commercial, retail and industrial customers across the United States and Canada.

These operations are conducted through our 28 company-owned terminals, third-party storage and terminal facilities, common carrier pipelines and a fleet of leased railcars.

We also provide marine exports of butane through our facility located in Chesapeake, Virginia.

Our Liquids Logistics segment conducts supply operations for natural gas liquids, refined petroleum products and biodiesel to a broad range of commercial, retail and industrial customers across the United States and Canada.

These operations are conducted through our 24 owned terminals, third-party storage and terminal facilities, nine common carrier pipelines and a fleet of leased railcars.

We also provide services for marine exports of butane through our facility located in Chesapeake, Virginia, and expect to commence operations on our propane pipeline in Michigan in June 2022.

We employ a number of contractual and hedging strategies to minimize commodity exposure and maximize earnings stability of this segment.

During the year ended March 31, 2021, we sold 3.3 billion gallons of natural gas liquids, refined products and renewables products, an average of 9.09 million gallons (approximately 216,000 barrels) per day.

We procure natural gas liquids from refiners, gas processing plants, producers and other resellers for delivery to leased or owned storage space, common carrier pipelines, railcar terminals, and direct to certain customers.

During the year ended March 31, 2022, we sold approximately 2.8 billion gallons of natural gas liquids, refined products and renewables products, or 7.61 million gallons (approximately 181,000 barrels) per day.

We procure natural gas liquids from refiners, natural gas processing plants, producers and other resellers for delivery to leased or owned storage space, common carrier pipelines, railcar terminals, and direct to certain customers.

Our customers take delivery by loading natural gas liquids into transport vehicles from common carrier pipeline terminals, private terminals, our terminals, directly from refineries and rail terminals, and by railcar.

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We utilize a portion of our railcar fleet and a portion of our leased underground storage to store butane for this purpose.

We also transport customer-owned natural gas liquids on our leased railcars and charge the customers a transportation service fee as well as subleasing railcars to certain customers.

We also transport customer-owned natural gas liquids on our leased railcars and charge the customers a transportation service fee as well as sublease railcars to certain customers.

Our owned and leased terminals and railcar fleet give us the opportunity to access markets throughout the United States, and to move product to locations where demand is highest.

We provide transportation, storage, and throughput services to third parties at our facilities at Kingfisher, Oklahoma, Port Hudson, Louisiana and Chesapeake, Virginia, as well as Sawtooth Caverns, LLC (“Sawtooth”), an underground storage facility near Delta, Utah, in which we own approximately a 71.5% interest, as described further below.

We provide transportation, storage, and throughput services to third parties at our facilities at Port Hudson, Louisiana and Chesapeake, Virginia.

We purchase refined petroleum and renewable products primarily in the Gulf Coast, West Coast and Midwest regions of the United States and schedule them for delivery at various locations throughout the country.

We conduct just-in-time sales at a nationwide network of terminals owned by third parties via rack spot sales that do not involve continuing contractual obligations to purchase or deliver product.

We conduct just-in-time sales at a nationwide network of terminals owned by third parties via rack spot sales or delivered sales that do not involve continuing contractual obligations to purchase or deliver product.

Rack spot sales are priced and delivered on a daily basis through truck loading racks.

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The following table summarizes the location of our facilities and respective storage capacity and interconnects to those facilities.

Storage Capacity

Storage Capacity (in gallons)

Location Number of Facilities Own (1) Lease (2) Total Terminal Interconnects

Utah 1 256,200,000 — 256,200,000 Rail Facility

Virginia 2 20,720,000 — 20,720,000 Rail Facility;

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Rail Facility

Oklahoma 2 898,800 — 898,800 Rail Facility

Massachusetts 2 668,400 120,000 788,400 Rail Facility

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Illinois 1 480,000 — 480,000 Connected to Phillips66 Blue Line Pipeline

Maine 2 — 240,000 240,000 Rail Facility

Michigan 1 480,000 480,000 Connected to Ambassador Pipeline

New York 1 — 270,000 270,000 Rail Facility

Pennsylvania 1 180,000 — 180,000 Rail Facility

Maine 1 — 120,000 120,000 Rail Facility

Vermont 1 — 120,000 120,000 Rail Facility

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The terminal in St.

Catherines, Ontario, Canada is operated by a third party under a year-to-year agreement.

Catharines, Ontario, Canada is operated by a third party under a year-to-year agreement.

We own the land on which 15 of the 24 natural gas liquids terminals are located and we either have easements or lease the land on which the remaining terminals are located.

We are the majority owner of Sawtooth, an underground storage facility near Delta, Utah.

This facility currently has capacity to store approximately 6.0 million barrels of natural gas liquids and refined products.

We lease storage to 15 customers, with lease terms ranging from one to three years.

The facility is located on property for which we have a long-term lease.

We own a natural gas liquids terminal that supports refined products blending in Port Hudson, Louisiana, and a natural gas liquids and condensate facility in Kingfisher, Oklahoma.

We own a natural gas liquids terminal that supports refined products blending in Port Hudson, Louisiana, and a marine export/import terminal in Norfolk, Virginia.

The Port Hudson terminal is located near Baton Rouge, Louisiana, and is in proximity to other refined products infrastructure along the Colonial pipeline.

This truck unloading and storage facility allows for the aggregation and supply of butane and naphtha for motor fuel blending and consists of storage tanks with a total capacity of 720,000 gallons.

The Kingfisher facility is a natural gas liquids and condensate facility located in Kingfisher, Oklahoma, which is located in the middle of the STACK production region.

The Chesapeake facility is a marine export/import terminal situated upstream of Norfolk, Virginia on the Elizabeth River.

The site includes a proprietary dock with the capacity to berth handy-sized vessels (a dry bulk carrier of an oil tanker with a capacity between 15,000 and 35,000 dead weight tonnage) to very large gas carriers (a carrier capable of loading anywhere between 100,000 cubic meters to 200,000 cubic meter of gas),

truck loading and off-road racks along with 22 railcar spots, with service provided by Norfolk Southern Railroad.

The facility has an aggregate storage capacity of 20,378,000 gallons.

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These transloading units can be moved to locations along a railroad where it is most convenient for customers to transfer their product.

In March 2021, we acquired the Ambassador pipeline, an approximately 225-mile natural gas liquids pipeline, which runs from the Kalkaska gas plant in Kalkaska County, Michigan to a termination point near Marysville in St.

We own the Ambassador Pipeline, an approximately 225-mile propane pipeline, which runs from the Kalkaska gas plant in Kalkaska County, Michigan to a termination point near Marysville in St.

Clair County, Michigan.

We plan to build a propane terminal, connected to the pipeline, in central Michigan.

This pipeline complements our existing assets in the upper Midwest and expands our presence with anchor assets in the state of Michigan, one of the top propane markets in the United States.

We are currently working on a Marysville, Michigan connection, which has an estimated completion date of June 2022 and will allow the Ambassador Pipeline to be fully operational.

The Wheeler propane terminal, in central Michigan, was fully permitted and operational on February 1, 2022.

These assets complement our existing assets in the upper Midwest and will expand our presence in Michigan, one of the top propane markets in the United States.

We utilize a fleet of approximately 4,400 high-pressure and general purpose leased railcars of which 34 railcars are subleased by third parties.

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Leased Storage Space

Storage Facility Beginning

Storage Facility Location Beginning

2022 Storage Interconnects

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Truck Facility

Utah 8,400,000 22,050,000 Rail Facility

Missouri 7,560,000 7,560,000 Truck Facility

Mississippi 7,056,000 7,980,000 Connected to Enterprise Dixie Pipeline;

Rail Facility

Arizona 7,056,000 7,056,000 Rail Facility;

Truck Facility

Texas 4,410,000 4,410,000 Connected to Enterprise Texas Eastern Products Pipeline;

Truck Facility

Oregon 554,400 554,400 Connected to Kinder Morgan Pipeline and Olympic Pipeline

Arizona — 4,956,000 Connected to Kinder Morgan Pipeline;

Mississippi 2,100,000 2,520,000 Connected to Enterprise Dixie Pipeline;

Rail Facility

Truck Facility

Oregon 554,400 554,400 Connected to Kinder Morgan Pipeline and Olympic Pipeline

United States Total 109,040,400 111,350,400

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Total 121,477,692 130,541,200

Our Liquids Logistics business serves approximately 1,400 customers in 49 states and Canada, including national, regional and independent retail, industrial, wholesale, petrochemical, refiner and natural gas liquids production customers.

Our Liquids Logistics segment serves approximately 1,300 customers in 48 states, Mexico and Canada, including national, regional and independent retail, industrial, wholesale, petrochemical, refiner and natural gas liquids production customers.

During the year ended March 31, 2022, 22% of the revenues of our Liquids Logistics segment were generated from our ten largest customers of the segment.

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The demand for gasoline typically peaks during the summer driving season, which extends from April to September, and declines during the fall and winter months.

However, the demand for diesel typically peaks during the fall and winter months due to colder temperatures in the Northeast, and peaks in the Midwest during spring planting and fall harvest.

Our Liquids Logistics business faces significant competition from other natural gas liquids wholesalers, trading companies and companies involved in the natural gas liquids midstream industry (such as terminal and refinery operations), some of which have greater financial resources than we do.

However, the demand for diesel typically peaks during the fall and winter months due to colder temperatures, and peaks in the Midwest during spring planting and fall harvest.

Our Liquids Logistics segment faces significant competition from other natural gas liquids wholesalers, trading companies and companies involved in the natural gas liquids midstream industry (such as terminal and refinery operations), some of which have greater financial resources than we do.

The primary factors on which we compete are:

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Changes in future mandates and incentives, or decisions by the federal government related to future reinstatement of the biodiesel tax credit, could result in changes in demand for ethanol and biodiesel.

Our Liquids Logistics segment operates primarily under the NGL Supply Wholesale, NGL Supply Terminal Company, Sawtooth Caverns, Centennial Energy, NGL Crude Logistics and Centennial Gas Liquids trade names.

Our Liquids Logistics segment operates primarily under the NGL Supply Wholesale, NGL Supply Terminal Company, Centennial Energy, NGL Crude Logistics and Centennial Gas Liquids trade names.

Human Capital

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We understand the importance of competitive benefits packages for the health and welfare of our employees and for our ability to recruit and retain the best talent.

In that regard, at the end of fiscal year 2021, we implemented $20 per hour minimum wage for all regular, full-time employees.

We are proud of the fact that 95% of our eligible employees participate in the NGL 401(k) Plan, and we increased our employer match in our 401(k) Plan in fiscal year 2021.

In addition, we provide access to health, life, and disability plans, including the following:

the choice between a traditional PPO or a high-deductible medical plan;

a health savings account with employer contributions for high-deductible plan participants;

a flexible spending account for traditional PPO participants;

In that regard, at the end of fiscal year 2021, we implemented $20 per hour

minimum wage for all regular, full-time employees.

More than 95% of our eligible employees participate in the NGL 401(k) Plan, and we increased our employer match in our 401(k) Plan in fiscal year 2021.

In addition, we provide access to a traditional PPO, or a high-deductible medical plan including a health savings account with employer contributions;

a flexible spending account option for those not enrolled in the high-deductible medical plan;

a dental plan;

a voluntary vision plan;

an Employee Assistance Plan with access to free counseling sessions;

a vision plan;

an Employee Assistance Plan including free counseling for employees and members of their household;

company-paid short-term disability coverage;

voluntary long-term disability coverage;

and life and AD&D plan opportunities.

Our operations are guided by specific health and safety principles.

Specifically, we endeavor to conduct our business in a manner that meets or exceeds applicable health and safety regulations and minimizes risk, both to our employees and the communities where we operate.

Our environmental, health and safety professionals:

• Advise on safety and industrial hygiene regulatory requirements and best practices;

• Develop safety procedures and guidelines;

• Conduct safety inspections;

• Advise on strategies to improve safety and health performance;

• Design and conduct safety and industrial hygiene training courses.

As part of this effort, we recently acquired and are implementing an enterprise management information system to help us achieve a better understanding of our performance, identify root causes of incidents of substandard performance, and where appropriate, implement necessary mitigations.

company-paid life and AD&D coverage;

and voluntary life and AD&D coverage options for employees and their family members.

Our operations are guided by specific health and safety protocols.

We endeavor to conduct our business in a manner that meets or exceeds applicable health and safety regulations and minimizes risk, both to our employees and the communities where we operate.

Our environmental, health and safety team:

• Advises on safety and industrial hygiene regulatory requirements and best practices;

• Develops safety procedures and guidelines;

• Conducts safety inspections;

• Advises on strategies to improve safety and health performance;

• Designs and conducts safety and industrial hygiene training courses.

As part of this effort, we have implemented an enterprise management information system designed to help us achieve a better understanding of our performance, identify root causes of incidents, and where appropriate, implement necessary mitigations.

Government Regulation

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Exploration and production operations and water disposal facilities are subject to various types of federal, state and local regulation, including, but not limited to, permitting, well location, methods of drilling, well operations, and conservation of resources.

While these regulations do not directly apply to our business, they may affect the businesses of certain of our customers and suppliers and thereby indirectly affect our business.

These regulations may affect our businesses and the businesses of certain of our customers and suppliers.

It is not possible to predict how or when regulations affecting our operations or our customers’ or suppliers’ operations might change.

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The transportation services on the Grand Mesa Pipeline are subject to FERC regulation.

In February 2018, the FERC issued a revised policy to disallow income tax allowance cost recovery in rates charged

by pipeline companies organized as master limited partnerships.

In February 2018, the FERC issued a revised policy to disallow income tax allowance cost recovery in rates charged by pipeline companies organized as master limited partnerships.

The FERC’s revised policy impacts cost-of-service rates on oil pipelines.

Currently, the volumes of crude oil that are transported on the Grand Mesa Pipeline are subject to contractual agreements.

Therefore, the FERC’s revised policy is not expected to impact the Grand Mesa Pipeline at the present time.

Therefore, the FERC’s revised policy has not impacted the Grand Mesa Pipeline at the present time.

Additionally, contracts we enter into for the interstate transportation or storage of crude oil or natural gas may be subject to FERC regulation including reporting or other requirements.

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We are subject to the anti-market manipulation provisions in the Natural Gas Act and the NGPA, which authorizes the FERC to impose fines of up to $1 million per day per violation of the Natural Gas Act, the NGPA, or their implementing regulations.

In addition, the Federal Trade Commission (“FTC”) holds statutory authority under the Energy Independence and Security Act of 2007 to prevent market manipulation in petroleum markets, including the authority to request that a court impose fines of up to $1 million per violation.

In addition, the Federal Trade Commission (“FTC”) holds statutory authority under the

Energy Independence and Security Act of 2007 to prevent market manipulation in petroleum markets, including the authority to request that a court impose fines of up to $1 million per violation.

These agencies have promulgated broad rules and regulations prohibiting fraud and manipulation in oil and gas markets.

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• shaping decisions regarding what types of pollution-control equipment to deploy and how a facility should be designed;

• informing construction activities, such as where to locate and where not to locate a facility, e.g., locating construction activities away from sensitive environmental, cultural or historic areas, including wetlands, coastal regions or areas inhabited by endangered or threatened species, and limiting or prohibiting construction activities during certain sensitive periods, such as when threatened or endangered species are breeding/nesting;

• informing decision-making regarding construction activities, such as where to locate and where not to locate a facility;

e.g., locating construction activities away from sensitive environmental, cultural or historic areas, including wetlands, coastal regions or areas inhabited by endangered or threatened species, and limiting or prohibiting construction activities during certain sensitive periods, such as when threatened or endangered species are breeding/nesting;

• informing decision-making regarding the timing of activities, for example, we will delay construction or system modification or upgrades during the issuance or renewal periods of certain permits;

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Consideration of and compliance with relevant environmental regulatory requirements has led our business activities to be more sustainable while simultaneously mitigating exposure to long and short-term environmental risk.

Conversely, failure to comply with these laws and regulations may trigger a variety of administrative, civil, and criminal enforcement measures,

including the assessment of monetary penalties.

Conversely, failure to comply with these laws and regulations may trigger a variety of administrative, civil, and criminal enforcement measures, including the assessment of monetary penalties.

Certain environmental statutes impose strict and joint and several liability for costs required to clean up and restore sites where substances such as crude oil or wastes have been disposed or otherwise unlawfully released.

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Our operations involve the shipment of crude oil by barge through navigable waters of the United States.

The Oil Pollution Act of 1990 amended the CWA to impose liability for releases of crude oil from vessels or

facilities into navigable waters.

The Oil Pollution Act of 1990 amended the CWA to impose liability for releases of crude oil from vessels or facilities into navigable waters.

If a release of crude oil to navigable waters occurred during shipment or from an oil terminal, we could be subject to liability under the Oil Pollution Act.

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In 1973, the EPA adopted oil pollution prevention regulations under the CWA.

These oil pollution prevention regulations, as amended several times since their original adoption, require the preparation of a Spill Prevention Control and Countermeasure (“SPCC”) plan for facilities engaged in drilling, producing, gathering, storing, processing, refining, transferring, distributing, using, or consuming crude oil and oil products, and which due to their location, could reasonably be expected to discharge oil in harmful quantities into or upon the navigable waters of the United States.

into or upon the navigable waters of the United States.

SPCC requirements under the CWA require appropriate containment berms and similar structures to help prevent the discharge of pollutants into regulated waters in the event of a crude oil or other constituent tank spill, rupture or leak.

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However, a portion of our customers’ crude oil and natural gas production is developed from unconventional sources that require hydraulic fracturing as part of the completion process, and our Water Solutions business treats and disposes of produced water generated from crude oil and natural gas production, including production employing hydraulic fracturing.

Legislation to amend the Safe Drinking Water Act to repeal the exemption for hydraulic fracturing from the definition of underground injection and require federal permitting and regulatory control of hydraulic fracturing, as well as legislative proposals to require disclosure of the chemical constituents of the fluids used in the fracturing process, have been proposed in recent sessions of Congress.

constituents of the fluids used in the fracturing process, have been proposed in recent sessions of Congress.

Congress will likely continue to consider legislation to amend the Safe Drinking Water Act to subject hydraulic fracturing operations to regulation under the Act’s UIC program and/or require disclosure of chemicals used in the hydraulic fracturing process.

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During the Trump Administration, rulemaking was undertaken resulting in a substantial relaxation in the GHG NSPS’s requirements, including those relating to fugitive emissions, pneumatic pump standards, and closed vent system certification, among other things, which were finalized on August 13, 2020.

The Biden Administration has announced that it intends to review the revisions to the GHG NSPS in President Biden’s January 20, 2021 Executive Order on Protecting Public Health and the Environment and Restoring Science to Tackle the Climate Crisi s.

It is foreseeable that the EPA may seek to reinstate the previous, more stringent regulations, though to do so, it will have to undertake notice-and-comment rulemaking consistent with the Administrative Procedure Act, which could take appreciable time to complete.

If future GHG regulations are more stringent, it could require us to incur costs to reduce emissions of GHGs associated with our operations and also could adversely affect demand for the products that we transport, store, process, or otherwise handle in connection with our services.

The Biden Administration announced its intention to review the revisions to the GHG NSPS in President Biden’s January 20, 2021 Executive Order on Protecting Public Health and the Environment and Restoring Science to Tackle the Climate Crisis .

On November 15, 2021, the EPA issued a proposal to revise the GHG NSPS regulations that, if finalized, would require methane emissions reductions and implementation of a fugitive emissions monitoring and repair program.

The public comment period closed on January 31, 2022, and the EPA has announced its intention to issue a supplemental proposal in 2022 that may expand on or modify the 2021 proposal in response to public input.

If these regulations are finalized or other future GHG regulations are more stringent, it could require us to incur costs to reduce emissions of GHGs associated with our operations and also could adversely affect demand for the products that we transport, store, process, or otherwise handle in connection with our services.

Some scientists have suggested climate change could increase the severity of extreme weather, such as increased hurricanes and floods, which could damage our facilities.

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In some states, state agencies administer these laws, while in other states, municipalities administer these laws.

We conduct training programs to help ensure that our operations comply with applicable governmental regulations.

conduct training programs to help ensure that our operations comply with applicable governmental regulations.

With respect to general operations, each state in which we operate adopts National Fire Protection Association, Pamphlet Nos.

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This act provides for additional regulatory oversight of the nation’s pipelines, increases the penalties for violations of pipeline safety rules, and complements the DOT’s other initiatives.

The 2011 Pipeline Safety Act increases the maximum fine for the most serious pipeline safety violations involving deaths, injuries or major environmental harm from $1 million to $2 million.

The 2011 Pipeline Safety Act increased the maximum fine for the most serious pipeline safety violations involving deaths, injuries or major environmental harm from $1 million to $2 million.

In addition, this law established additional safety requirements for newly constructed pipelines.

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Our marine vessel operations are also subject to safety and operational standards established and monitored by the United States Coast Guard.

In general, we expect to increase our expenditures relating to compliance with likely higher industry and regulatory safety standards such as those described above.

general, we expect to increase our expenditures relating to compliance with likely higher industry and regulatory safety standards such as those described above.

However, these expenditures cannot be accurately estimated at this time, but we do not expect compliance with these standards to have a material adverse effect on our business.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business