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Item 9A. Controls and Procedures

2022-06-06 compared with 2021-06-03 · 617 added, 824 removed, 2116 unchanged (41% of the section changed)

1 unchanged sentence

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures, as defined in Rule 13(a)-15(e) and 15(d)-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that are designed to provide reasonable assurance that information required to be disclosed in our filings and submissions under the Exchange Act is recorded, processed, summarized and reported within the periods specified in the rules and forms of the Securities and Exchange Commission (“SEC”) and that such information is accumulated and communicated to our management, including the principal executive officer and principal financial officer of our general partner, as appropriate, to allow timely decisions regarding required disclosure.

We maintain disclosure controls and procedures, as defined in Rule 13(a)-15(e) and 15(d)-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that are designed to provide the information required to be disclosed in our filings and submissions under the Exchange Act is recorded, processed, summarized and reported within the periods specified in the rules and forms of the Securities and Exchange Commission (“SEC”) and that such information is accumulated and communicated to our management, including the principal executive officer and principal financial officer of our general partner, as appropriate, to allow timely decisions regarding required disclosure.

We completed an evaluation under the supervision and with participation of our management, including the principal executive officer and principal financial officer of our general partner, of the effectiveness of the design and operation of our disclosure controls and procedures at March 31, 2022.

Based on this evaluation, the principal executive officer and principal financial officer of our general partner have concluded that as of March 31, 2021, such disclosure controls and procedures were effective to provide the reasonable assurance described above.

Based on this evaluation, the principal executive officer and principal financial officer of our general partner have concluded that as of March 31, 2022, such disclosure controls and procedures were effective.

Management’s Report on Internal Control Over Financial Reporting

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Other Information

Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

Not applicable.

Directors, Executive Officers and Corporate Governance

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Named executive officers are appointed by, and serve at the discretion of, the board of directors of our general partner.

The following table summarizes information regarding the directors of our general partner and our named executive officers as of May 28, 2021.

The following table summarizes information regarding the directors of our general partner and our named executive officers as of June 1, 2022.

Name Age Position with NGL Energy Holdings LLC

Michael Krimbill 68 Chief Executive Officer and Director

Karlovich III 44 Executive Vice President and Chief Financial Officer

Bridges 38 Executive Vice President and Chief Financial Officer

Ciolek 58 Executive Vice President, Strategic Initiatives

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Krimbill has served as our Chief Executive Officer since October 2010 and as a member of the board of directors of our general partner since its formation in September 2010.

From February 2007 through September 2010, Mr.

Krimbill managed private investments.

Krimbill was the President and Chief Financial Officer of Energy Transfer Partners, L.P.

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Krimbill brings leadership, oversight and financial experience to the board.

Krimbill provides expertise in managing and operating a publicly traded partnership, including substantial expertise in successfully acquiring and integrating propane and midstream businesses.

Krimbill provides expertise in managing and operating a publicly traded partnership, including substantial expertise in successfully acquiring and integrating midstream businesses.

Krimbill also brings financial expertise to the board, including his prior service as a chief financial officer.

Krimbill’s experience serving on other public company boards is also a valuable asset to our board of directors.

Karlovich III .

Karlovich has served as our Executive Vice President and Chief Financial Officer since February 2016.

Prior to joining NGL, Mr.

Karlovich served as Chief Financial Officer of Targa Pipeline Partners, a subsidiary of Targa Resources Partners, LP, from February 2015 through February 2016, and as Senior Vice President of Commercial and Business Development for Targa Resources Partners, LP from November 2015 to February 2016.

Karlovich served in various roles at Atlas Pipeline Partners, L.P.

and its subsidiaries (“APL”), including most recently as Chief Financial Officer, from September 2006 to February 2015 when APL merged with Targa Resources Partners, LP.

Karlovich served in various roles at Syntroleum Corporation from February 2004 to September 2006.

Prior to that, Mr.

Karlovich worked at Arthur Andersen LLP and Grant Thornton LLP.

Karlovich is a certified public accountant.

Bridges has served as our Executive Vice President and Chief Financial Officer since September 30, 2021.

Bridges served as our Senior Vice President, Finance and Treasurer from April 2018 to September 2021.

She joined the general partner in June 2016, as Vice President of Finance and Treasurer until she was promoted.

Bridges spent nine years in the commercial division at the Bank of Oklahoma, holding various positions including Vice President - Energy Lending.

Ciolek joined us in December 2019 and was appointed as our Executive Vice President, Strategic Initiatives, by the board of directors of our general partner in January 2020.

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and Robinett & Osmond and was a founding shareholder of Kurston P.

McMurray, PC and Wilkin/

McMurray PLLC.

McMurray, PC and Wilkin/McMurray PLLC.

McMurray’s private practice specialized in business transactions, real estate, construction, healthcare, banking, corporate governance, corporate management and commercial litigation.

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from December 2007 through October 2015, most recently as Vice President of Financial Reporting and Corporate Controller.

Thuillier served as Assistant Corporate Controller for Exterran Holdings, Inc.

Thuillier served as Assistant Corporate

Controller for Exterran Holdings, Inc.

(formerly Universal Compression) from November 2006 through November 2007.

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Guderian previously served as Vice President of the Exploration & Production unit of The Williams Companies, Inc.

from 1998 until August 2011, where

he had responsibility for overseeing international operations.

from 1998 until August 2011, where he had responsibility for overseeing international operations.

Guderian served as a director of Apco Oil & Gas International Inc., from 2002 to 2015 and as a director of Petrolera Entre Lomas S.A.

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Board Leadership Structure and Role in Risk Oversight

The board of directors of our general partner believes that whether the offices of chairman of the board and chief executive officer are combined or separated should be decided by the board, from time to time, in its business judgment after

considering relevant circumstances.

The board of directors of our general partner currently does not have a chairman, although our chief executive officer, Mr.

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Collingsworth, Mr.

Cropper, and Mr.

Guderian, and Mr.

Reiners currently serve on the audit committee, and Mr.

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• making recommendations to the board of directors with respect to the directors;

• reviewing and making recommendations to the board of directors with respect to incentive compensation and equity-based plans.

• reviewing and making recommendations to the board of directors with respect to incentive compensation and equity-based compensation plans.

Collingsworth, Mr.

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Cropper serves as the chairman.

The board of directors has determined that Mr.

The board of directors of our general partner has determined that Mr.

Collingsworth and Mr.

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Michael Krimbill–Chief Executive Officer

Karlovich III–Executive Vice President and Chief Financial Officer

Bridges–Executive Vice President and Chief Financial Officer (effective September 30, 2021)

• Lawrence J.

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Ciolek–Executive Vice President, Strategic Initiatives

Karlovich III–Former Executive Vice President and Chief Financial Officer (resigned effective September 30, 2021)

Compensation Philosophy

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• Reward success in reaching those goals.

Recent Achievements

Our compensation structure is designed to reward our executive officers for achieving above-market returns for our unitholders.

Our achievements during the year ended March 31, 2021 included the following:

• Issued $2.05 billion of 7.5% senior secured notes due 2026 (“2026 Senior Secured Notes”);

• Entered in a new $500.0 million asset-based revolving credit facility (“ABL Facility”) in February 2021.

Compensation Highlights

• We paid cash bonuses to Mr.

Karlovich and Mr.

Thuillier during fiscal year 2021 primarily due to their work related to the issuance of the 2026 Senior Secured Notes and the ABL facility.

We paid cash bonuses to Mr.

McMurray during fiscal year 2021 primarily due to his work related to the issuance of the 2026 Senior Secured Notes, closing the ABL Facility and closing the transaction with WaterBridge Resources LLC.

Factors Enhancing Alignment with Unitholder Interests

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In carrying out its responsibilities for establishing, implementing and monitoring the effectiveness of our executive compensation philosophy, plans and programs, our compensation committee has the authority to engage outside experts to assist in its deliberations.

During fiscal year 2021, the compensation committee received compensation advice and data from Pearl Meyer & Partners (“PM&P”).

PM&P provided advice and guidance regarding the principal components of compensation for our directors.

In March 2021, the compensation committee received compensation advice and data from Pearl Meyer & Partners (“PM&P”).

PM&P provided advice and guidance regarding the principal components of compensation for our directors and market salary information for certain executive and senior vice president positions.

The compensation committee reviewed the services provided by PM&P and determined that they are independent in providing executive compensation consulting services.

In making this determination, the compensation committee noted that during fiscal year 2021:

In making this determination, the compensation committee noted the following:

◦ PM&P did not provide any services to the Partnership or management other than compensation consulting services requested by or with the approval of the compensation committee;

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◦ PM&P maintains a conflicts policy, which was provided to the compensation committee with specific policies and procedures designed to ensure independence;

◦ Fees paid to PM&P by the Partnership during fiscal year 2021 were less than 1% of PM&P’s total revenue;

◦ Fees paid to PM&P by the Partnership for the services provided in March 2021 were less than 1% of PM&P’s total revenue;

◦ None of the PM&P consultants working on Partnership matters had any business or personal relationship with compensation committee members;

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We do not make automatic annual adjustments to base salary.

Krimbill’s initial base salary of $120,000 was originally determined as part of the negotiations for our formation transactions.

Effective July 1, 2014, the board of directors increased Mr.

Krimbill’s salary to $350,000, in consideration of the fact that his salary was low relative to the benchmark peer group.

Effective April 1, 2018, Mr.

Krimbill’s base salary was increased to $625,000, in consideration of the fact that his salary was low relative to the benchmark peer group.

Karlovich’s base salary of $400,000 was negotiated prior to his joining our management team in February 2016.

Karlovich’s base salary was increased to $430,000 in April 2017.

On June 10, 2018, Mr.

Karlovich’s base salary was increased to $500,000, in consideration of the fact that his salary was low relative to the benchmark peer group.

Thuillier’s base salary of $250,000 was negotiated prior to his joining our management team in January 2016.

In April 2017, Mr.

Thuillier’s base salary was increased to $260,000.

In April 2018, Mr.

Thuillier’s base salary was increased to $268,000.

In March 2019, Mr.

Thuillier’s base salary was increased to $270,000.

Effective March 28, 2021, Mr.

Thuillier’s base salary was increased to $300,000.

McMurray’s base salary of $250,000 was negotiated prior to his joining our management team in February 2015.

McMurray’s base salary was increased to $300,000 in April 2017.

Effective April 1, 2018, Mr.

McMurray’s base salary was increased to $350,000.

In March 2019, Mr.

McMurray’s base salary was increased to $375,000.

Effective March 28, 2021, Mr.

McMurray’s base salary was increased to $500,000.

Ciolek’s base salary of $500,000 was negotiated prior to joining our management team in December 2019.

Our named executive officers are entitled to the following annual base salaries:

Name Fiscal Year Ended

March 31, 2021

Base Salary Rate($)(1) Fiscal Year Ended

March 31, 2022

Base Salary Rate($)(2)

Michael Krimbill 625,000 625,000

Bridges — 500,000

Thuillier 300,000 312,000

McMurray 500,000 500,000

Ciolek 500,000 500,000

Karlovich III 500,000 500,000

Thuillier and McMurray’s base salary rates became effective March 28, 2021.

All other named executive officers’ base salary rates were effective April 1, 2020, other than Ms.

Bridges who was not serving as a named executive officer during the relevant fiscal year.

Bridges base salary rate became effective with her appointment to Executive Vice President and Chief Financial Officer on September 30, 2021.

Thuillier’s base salary rate became effective on January 16, 2022.

Karlovich’s base salary rate for the fiscal year was prorated through September 30, 2021, the date of his resignation from employment.

All other named executive officers’ base salary rates were effective April 1, 2021.

Discretionary Cash Bonus Awards

None of the named executive officers is subject to a formal cash bonus plan, and any cash bonuses are at the discretion of the compensation committee of the board of directors.

Cash bonuses of less than $0.1 million were paid to both Mr.

Karlovich and Mr.

McMurray in fiscal year 2021.

Cash bonuses of $0.6 million and $0.2 million were paid in April 2021 to Mr.

Karlovich and Mr.

Thuillier, respectively, for their work related to the issuance of the 2026 Senior Secured Notes and closing the ABL Facility.

A cash bonus of $0.6 million was paid to Mr.

McMurray in April 2021 primarily due to his work related to the issuance of the 2026 Senior Secured Notes, closing the ABL Facility and closing the transaction with WaterBridge Resources LLC.

During fiscal year 2022, cash bonuses of $0.3 million were paid to

Ciolek and Mr.

McMurray and cash bonuses of $0.2 million were paid to both Ms.

Bridges and Mr.

Krimbill nor Mr.

Ciolek received a cash bonus in fiscal year 2021.

Karlovich received a cash bonus during fiscal year 2022.

Long-Term Equity Incentive Awards

Certain restricted units granted to the named executive officers vest in tranches, contingent only on the continued service of the recipient through the vesting date (the “Service Awards”).

The following table summarizes Service Award units activity during fiscal year 2021 with respect to the named executive officers:

The Partnership previously adopted a long-term incentive plan (“LTIP”), which allowed for the issuance of equity-based compensation.

The LTIP expired with respect to future awards on May 10, 2021.

Prior to expiring, on May 5, 2021, the compensation committee of our board of directors granted certain restricted units to the named executive officers, which vest in tranches, subject to the continued service of the recipients through the vesting date (the “Service Awards”).

See “ 2022 Grants of Plan Based Awards ” for details about the number of restricted Service Award units granted in fiscal year 2022 and the relevant vesting terms.

The following table summarizes Service Award units activity for all outstanding Service Award grants during fiscal year 2022 with respect to the named executive officers:

Unvested Units at Unvested Units at

Name March 31, 2020 Units Vested March 31, 2021 (6)

Name March 31, 2021 Units Granted Units Vested Units Forfeited March 31, 2022

Michael Krimbill (1) 75,000 250,000 (137,500) — 187,500

Karlovich III (2) 37,500 (25,000) 12,500

Bridges (2) 6,250 100,000 (31,250) — 75,000

Thuillier (3) 5,000 55,000 (18,750) — 41,250

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Ciolek (5) 12,500 150,000 (50,000) — 112,500

Karlovich III (6) 12,500 150,000 — (162,500) —

Krimbill vested in 75,000 Service Awards on November 12, 2021 and 62,500 Service Awards on February 10, 2022.

Karlovich vested in 12,500 Service Awards on November 10, 2020 and 12,500 Service Awards on February 11, 2021.

He was granted 250,000 Service Awards on May 5, 2021.

Bridges vested in 6,250 Service Awards on November 12, 2021 and 25,000 Service Awards on February 10, 2022.

She was granted 100,000 Service Awards on May 5, 2021.

Thuillier vested in 5,000 Service Awards on November 12, 2021 and 13,750 Service Awards on February 10, 2022.

He was granted 55,000 on May 5, 2021.

McMurray vested in 10,000 Service Awards on November 12, 2021 and 37,500 Service Awards on February 10, 2022.

He was granted 150,000 Service Awards on May 5, 2021.

Ciolek vested in 12,500 Service Awards on November 12, 2021 and 37,500 Service Awards on February 10, 2022.

(6) All of the Service Awards in the table above will vest on November 12, 2021.

In May 2021, the compensation committee of the board of directors of our general partner granted 250,000 Service Awards to Mr.

Krimbill, 150,000 Service Awards each to Mr.

Karlovich, Mr.

McMurray and Mr.

Ciolek and 55,000 Service Awards to Mr.

For each individual, one-fourth of those grants will vest in each of February 10, 2022, November 14, 2022, February 13, 2023 and November 15, 2023.

He was granted 150,000 Service Awards on May 5, 2021.

Karlovich was granted 150,000 Service Awards on May 5, 2021.

He forfeited all outstanding Service Awards upon his resignation from employment on September 30, 2021.

The following table summarizes the vesting dates of unvested Service Award units at March 31, 2022:

Units by Vesting Date Unvested Units at

Name November 14, 2022 February 13, 2023 November 15, 2023 March 31, 2022

Michael Krimbill 62,500 62,500 62,500 187,500

Bridges 25,000 25,000 25,000 75,000

Thuillier 13,750 13,750 13,750 41,250

McMurray 37,500 37,500 37,500 112,500

Ciolek 37,500 37,500 37,500 112,500

Severance and Change in Control Benefits

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McMurray, who is entitled to receive severance benefits pursuant to his employment agreement in the event of certain terminations of his employment (as described below after the “Summary Compensation Table” under the heading, “Employment Agreement with Mr.

The board of directors has the option to accelerate the vesting of the restricted units in the event of a change in control of the Partnership, although it is not under any obligation to do so.

If the board of directors were to exercise its discretion to accelerate the vesting of restricted units upon a change in control, the value of such units would be the same as reported in the “Outstanding Equity Awards at March 31, 2021” table below (in the “Market Value of Service Award Units that Have Not Yet Vested” column).

The board of directors has the option to accelerate the vesting of the Service Awards in the event of a change in control of the Partnership, although it is not under any obligation to do so.

If the board of directors were to exercise its discretion to accelerate the vesting of Service Awards upon a change in control, that hypothetically occurred on March 31, 2022, the value of such units would be the same as reported in the “Outstanding Equity Awards at March 31, 2022” table below (in the “Market Value of Service Award Units that Have Not Yet Vested” column).

We have established a defined contribution 401(k) plan to assist our eligible employees in saving for retirement on a tax-deferred basis.

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For every dollar that employees contribute up to 4% of their eligible compensation (as defined in the plan), we contribute one dollar, plus 50 cents for every dollar employees contribute between 4% and 6% of their eligible compensation (as defined in the plan).

Our matching contributions vest over two years.

Our matching contributions vest over an employee’s first two years of employment, subject to a participant’s continued service.

Other Benefits

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Other Officers

Certain officers who have leadership roles within our individual business units, but who are not executive officers, participate in formulaic bonus programs that are based on the performance of the individual business units with which they are involved.

Certain officers who have leadership roles within our individual business segments, but who are not executive officers, participate in formulaic bonus programs that are based on the performance of the individual business segments with which they are involved.

In most cases, similar programs were in place prior to our acquisition of the businesses, and we have left the programs substantially intact.

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None of these individuals is an employee or an officer of our general partner.

As described under Part I, Item 13–“Transactions with Related Persons,” Mr.

Guderian was an executive officer of WPX, and we entered into certain transactions with WPX during fiscal year 2021.

Summary Compensation Table

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($) Restricted Unit

Awards (Service and Performance Awards) (1)

(Service Awards) (1)

($) All Other

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2020 625,000 1,500,000 1,000,011 11,019 3,136,030

Karlovich III 2021 500,000 600,000 — 12,759 1,112,759

Bridges (3) 2022 413,846 200,000 215,000 15,632 844,478

Executive Vice President and

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Strategic Initiatives 2020 140,385 — 501,250 119 641,754

(1) The fair values of the restricted units shown in the table above were calculated based on the closing market prices of our common units on the grant dates, with adjustments made to reflect the fact that the restricted units are not entitled to distributions during the vesting period.

The impact of the lack of distribution rights during the vesting period was estimated using the value of the most recent distribution prior to the grant date and assumptions that a market participant might make about future distribution growth.

This calculation of fair value is consistent with the provisions of Accounting Standards Codification (“ASC”) 718 Stock Compensation.

(2) The amounts in this column include matching contributions to our 401(k) plan.

Ciolek commenced employment in December 2019, and thus was not a named executive office prior to fiscal year 2020.

Karlovich III (4) 2022 276,923 — 322,500 6,907 606,330

Executive Vice President and 2021 500,000 600,000 — 12,759 1,112,759

Chief Financial Officer 2020 500,000 500,000 100,012 6,900 1,106,912

(1) The fair values of the restricted units shown in the table above were calculated in accordance with FASB Accounting Standards Codification (“ASC”) Topic 718, Stock Compensation.

For a discussion of the assumptions and methodologies used in calculating the grant date fair value of the restricted unit awards, see Note 9 to our consolidated financial statements included in this Annual Report.

(2) The amounts in this column include matching contributions to our 401(k) plan and taxable group term life insurance.

Bridges became Executive Vice President and Chief Financial Officer effective September 30, 2021, and thus was not a named executive officer prior to fiscal year 2022.

Karlovich resigned as Executive Vice President and Chief Financial Officer effective September 30, 2021.

Employment Agreement with Mr.

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The agreement has a term of five years from the effective date, subject to automatic renewals for one-year periods thereafter unless either party provides 60 days’ notice of non-renewal of the term.

The agreement was renewed by its terms as of March 10, 2022.

The agreement provides that Mr.

McMurray will receive a base salary of no less than $250,000 per year and will be eligible to receive an annual bonus with respect to each fiscal year of the Partnership at a target of 100% of his base salary.

McMurray is also entitled to receive annual awards of unvested units under the Partnership’s long-term incentive plan (“LTIP”).

McMurray is also entitled to receive annual awards of unvested units under the Partnership’s LTIP.

In the event that Mr.

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McMurray remained employed for an additional three years following his termination, and (iii) his target annual bonus for the performance year in which his termination occurs.

McMurray would also be entitled to receive the severance benefits described in the foregoing sentence in the event that he voluntarily resigns due to a “constructive discharge,” which circumstances would include (1) a reduction of Mr.

McMurray would also be entitled to receive

the severance benefits described in the foregoing sentence in the event that he voluntarily resigns due to a “constructive discharge,” which circumstances would include (1) a reduction of Mr.

McMurray’s annual base salary below $250,000 (other than an across-the-board, pro rata reduction of no more than 10% applicable to all similarly situated executive officers of the Partnership) or the Partnership’s failure to provide Mr.

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McMurray’s authority, power or responsibilities, or (4) the Partnership’s relocation of its principal place of business in Oklahoma to a location more than 50 miles from its current location.

McMurray is subject to non-disclosure and intellectual property rights assignment

obligations, and an obligation not to solicit customers, employees or consultants lasting during his employment and for a period of 12 months thereafter.

McMurray is subject to non-disclosure and intellectual property rights assignment obligations, and an obligation not to solicit customers, employees or consultants lasting during his employment and for a period of 12 months thereafter.

Restricted Unit Awards

During fiscal year 2021, the compensation committee granted no units to the named executive officers.

During fiscal year 2022, the compensation committee granted Service Awards to the named executive officers.

2022 Grants of Plan Based Awards

The following table summarizes the number of restricted Service Award units granted to our named executive officers, and their grant date fair values:

Name Grant Date Total Number of Service Award

Units (#) Grant Date Fair Value of

Service Award Units

Michael Krimbill May 5, 2021 250,000 537,500

Bridges May 5, 2021 100,000 215,000

Thuillier May 5, 2021 55,000 118,250

McMurray May 5, 2021 150,000 322,500

Ciolek May 5, 2021 150,000 322,500

Karlovich III May 5, 2021 150,000 322,500

(1) The fair values of the restricted Service Award units shown in the table above were calculated in accordance with ASC Topic 718, Stock Compensation, and does not represent the amount actually realized by the named executive officer at vesting, which may be more or less than the amount reported in the table above.

The 2022 Service Awards vest and settle in common units.

During fiscal year 2022, the compensation committee granted Service Awards to the named executive officers for which units vest in substantially equal installments on February 10, 2022, November 14, 2022, February 13, 2023 and November 15, 2023, subject to the continued service of the recipients through each such vesting date.

Outstanding Equity Awards at March 31, 2022

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Michael Krimbill 187,500 416,250

Karlovich III 12,500 25,500

Bridges 75,000 166,500

Thuillier 41,250 91,575

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Ciolek 112,500 249,750

Karlovich III (3) — —

(1) Reflects Service Awards that have not vested and are held by each named executive officer.

The outstanding Service Awards units vest in substantially equal installments on November 14, 2022, February 13, 2023 and November 15, 2023.

(2) Calculated based on the closing market price of our common units at March 31, 2022 of $2.22.

No adjustments were made to reflect the fact that the restricted units are not entitled to distributions during the vesting period.

Karlovich resigned effective September 30, 2021 resulting in the forfeiture of his Service Awards.

As a result, Mr.

Karlovich did not have any outstanding equity awards as of March 31, 2022.

2022 Units Vested

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Michael Krimbill (1) 137,500 379,500

Karlovich III (2) 25,000 63,250

Bridges (2) 31,250 63,250

Thuillier (3) 18,750 25,300

1 unchanged sentence

Ciolek (5) 50,000 63,250

Karlovich III (6) — —

Krimbill vested in 75,000 Service Awards on November 12, 2021 and 62,500 Service Awards on February 10, 2022.

Karlovich vested in 12,500 Service Awards on November 10, 2020 and 12,500 Service Awards on February 11, 2021.

Bridges vested in 6,250 Service Awards on November 12, 2021 and 25,000 Service Awards on February 10, 2022.

Thuillier vested in 5,000 Service Awards on November 12, 2021 and 13,750 Service Awards on February 10, 2022.

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Ciolek vested in 12,500 Service Awards on November 12, 2021 and 37,500 Service Awards on February 10, 2022.

Karlovich forfeited all outstanding Service Awards upon his resignation from employment on September 30, 2021.

Upon vesting, certain of the named executive officers elected for us to remit payments to taxing authorities in lieu of issuing common units.

4 unchanged sentences

Michael Krimbill 137,500 — 137,500

Karlovich III 13,749 11,251 25,000

Bridges 16,753 14,497 31,250

Thuillier 10,489 8,261 18,750

9 unchanged sentences

$ 500,000 $ 249,750 $ 500,000 $ 1,249,750

The board of directors has the option to accelerate the vesting of the restricted units in the event of a change in control of the Partnership, although it is not under any obligation to do so.

If the board of directors were to exercise its discretion to accelerate the vesting of restricted units upon a change in control, the value of such units would be the same as reported in the “Outstanding Equity Awards at March 31, 2021” table above (in the “Market Value of Service Award Units that Have Not Yet Vested” column).

The board of directors has the option to accelerate the vesting of the Service Awards in the event of a change in control of the Partnership, although it is not under any obligation to do so.

If the board of directors were to exercise its discretion to accelerate the vesting of Service Awards upon a change in control, that hypothetically occurred on March 31, 2022, the value of such units would be the same as reported in the “Outstanding Equity Awards at March 31, 2022” table above (in the “Market Value of Service Award Units that Have Not Yet Vested” column).

Pay Ratio Disclosure

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The following table summarizes the compensation earned during fiscal year 2022 by each director who is not an officer or employee of our general partner or its affiliates:

Name Fees Earned or

($) Restricted Unit

Coady 80,000 107,500 187,500

Collingsworth 104,000 107,500 211,500

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Reiners 100,000 107,500 207,500

(1) Amount represents fees paid in cash.

No restricted units were granted to any of the directors during fiscal year 2021.

(1) The amounts reflected in this column represent the grant date fair value of each director’s May 5, 2021 award of 50,000 restricted units, which were calculated in accordance with ASC Topic 718, Stock Compensation.

See table below for discussion of the vesting of these grants.

Long-Term Equity Incentive Awards

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Unvested Units at Unvested Units at

Name March 31, 2020 Units Vested March 31, 2021 (2)

Name March 31, 2021 Units Granted Units Vested (1) March 31, 2022 (2)

Coady 4,000 50,000 (16,500) 37,500

3 unchanged sentences

Reiners 4,000 50,000 (16,500) 37,500

Collingsworth, Mr.

Guderian and Mr.

Reiners each vested in 4,000 Service Awards on November 10, 2020 and February 11, 2021.

(2) All of the Service Awards in the table above will vest on November 12, 2021.

In May 2021, the board of directors of our general partner granted 50,000 Service Awards to each of Dr.

Collingsworth, Mr.

Guderian and Mr.

For each individual, one-fourth of those grants will vest in each of February 10, 2022, November 14, 2022, February 13, 2023 and November 15, 2023.

(1) 4,000 Service Awards vested on November 12, 2021 and 12,500 Service Awards vested on February 10, 2022.

(2) 12,500 Service Awards will vest on November 14, 2022, 12,500 Service Awards will vest on February 13, 2023 and 12,500 Service Awards will vest on November 15, 2023, subject to the continued service of the recipients through each such vesting date.

Security Ownership of Certain Beneficial Owners and Management and Related Unitholder Matters

Security Ownership of Certain Beneficial Owners and Management

The following table summarizes the beneficial ownership, as of May 28, 2021, of our common units by:

The following table summarizes the beneficial ownership, as of June 1, 2022, of our common units by:

• each person or group of persons known by us to be a beneficial owner of more than 5% of our outstanding common units;

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Directors and named executive officers:

Bridges (4) 62,165 *

Ciolek (5) 194,764 *

3 unchanged sentences

Guderian 85,000 *

Karlovich III (8) 101,631 *

Michael Krimbill (9) 4,127,518 3.16 %

5 unchanged sentences

* Less than 1.0%

(1) Based on 129,593,939 common units outstanding at May 28, 2021.

(1) Based on 130,695,970 common units outstanding at June 1, 2022.

(2) The mailing address for Invesco Ltd.

is 1555 Peachtree Street NE, Suite 1800, Atlanta, GA 30309.

reported shared voting and dispositive power with respect to all common units beneficially owned.

reported sole voting and dispositive power with respect to all common units beneficially owned.

The information related to Invesco Ltd.

is based upon its Schedule 13G filed with the SEC for the quarter ended December 31, 2020.

is based upon its Schedule 13G/A filed with the SEC on February 10, 2022.

(3) The mailing address for EIG Neptune Equity Aggregator, L.P.

(“EIG Neptune”) is 600 New Hampshire Ave NW, Suite 1200, Washington, DC 20037.

EIG Neptune reported shared voting and dispositive power with respect to all common units beneficially owned.

The information related to EIG Neptune is based upon its Schedule 13D filed with the SEC for the quarter ended September 30, 2020.

EIG Neptune reported sole voting and dispositive power with respect to all common units beneficially owned.

The information related to EIG Neptune is based upon its Schedule 13D/A filed with the SEC on September 4, 2020.

The common units beneficially owned relate to warrants that were exercisable on July 2, 2020.

For purposes of calculating ownership percentages, the units underlying the warrants are only deemed outstanding for purposes of calculating EIG Neptune’s percentage.

(4) Does not include 12,500 unvested units that will vest on November 12, 2021, 37,500 unvested units that will vest on February 10, 2022, 37,500 unvested units that will vest on November 14, 2022, 37,500 unvested units that will vest on February 13, 2023 and 37,500 unvested units that will vest on November 15, 2023.

(4) Does not include 75,000 unvested units, of which 25,000 will vest on each of the following dates, November 14, 2022, February 13, 2023 and November 15, 2023, subject to the continued service through each such vesting date.

(5) Does not include 112,500 unvested units, of which 37,500 will vest on each of the following dates, November 14, 2022, February 13, 2023 and November 15, 2023, subject to the continued service through each such vesting date.

Coady owns 134,804 of these common units.

18 unchanged sentences

Cropper, are the trustees, owns 25,000 of these common units.

(8) Does not include 12,500 unvested units that will vest on November 12, 2021, 37,500 unvested units that will vest on February 10, 2022, 37,500 unvested units that will vest on November 14, 2022, 37,500 unvested units that will vest on February 13, 2023 and 37,500 unvested units that will vest on November 15, 2023.

Karlovich owns a 0.3% interest in our general partner through TK3 Investment Holdings, LLC.

of which he own 100% of the membership interests.

Krimbill owns 1,153,615 of these common units, which does not include 75,000 unvested units that will vest on November 12, 2021, 62,500 unvested units that will vest on February 10, 2022, 62,500 unvested units that will vest on November 14, 2022, 62,500 unvested units that will vest on February 13, 2023 and 62,500 unvested units that will vest on November 15, 2023.

Krimbill owns 2,241,115 of these common units, which does not include 187,500 unvested units, of which 62,500 will vest on each of the following dates, November 14, 2022, February 13, 2023 and November 15, 2023, subject to the continued service through each such vesting date.

All of the unvested units noted above were reported on Mr.

7 unchanged sentences

Michael Krimbill via his ownership of its general partner, Krimbill Holding Company.

Michael Krimbill may be deemed to have sole voting and investment power over these units, but disclaims such beneficial ownership except to the extent of his pecuniary interest therein.

Michael Krimbill may be deemed to

have sole voting and investment power over these units, but disclaims such beneficial ownership except to the extent of his pecuniary interest therein.

KrimGP2010 LLC owns 363,555 of these common units.

6 unchanged sentences

Michael Krimbill may be deemed to have sole voting and investment power over these units, but disclaims such beneficial ownership except to the extent of his pecuniary interest therein.

Michael Krimbill also owns a 14.81% interest in our general partner through KrimGP2010, LLC, of which he owns 100% of the membership interests and Krimbill Capital Group, LLC, which is owned 100% by the H.

Michael Krimbill Revocable Trust, of which Mr.

Krimbill is the trustee.

(10) Does not include 10,000 unvested units that will vest on November 12, 2021, 37,500 unvested units that will vest on February 10, 2022, 37,500 unvested units that will vest on November 14, 2022, 37,500 unvested units that will vest on February 13, 2023 and 37,500 unvested units that will vest on November 15, 2023.

Michael Krimbill also owns a 14.81% interest in our general partner through KrimGP2010, LLC, of which he owns 100% of the membership interests.

(10) Does not include 112,500 unvested units, of which 37,500 will vest on each of the following dates, November 14, 2022, February 13, 2023 and November 15, 2023, subject to the continued service through each such vesting date.

McMurray owns a 0.25% interest in our general partner through MCM Investments, LLC, of which he owns 100% of the membership interests.

(11) Does not include 5,000 unvested units that will vest on November 12, 2021, 13,750 unvested units that will vest on February 10, 2022, 13,750 unvested units that will vest on November 14, 2022, 13,750 unvested units that will vest on February 13, 2023 and 13,750 unvested units that will vest on November 15, 2023.

(11) Does not include 41,250 unvested units, of which 13,750 will vest on each of the following dates, November 14, 2022, February 13, 2023 and November 15, 2023, subject to the continued service through each such vesting date.

(12) The directors and executive officers of our general partner also collectively own a 29.69% interest in our general partner.

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Prior to the expiration of the LTIP on May 10, 2021, we granted approximately 3.3 million common units as Service Awards, which will vest in our 2023 and 2024 fiscal years.

Due to the LTIP expiring, we have no common units available for grant and any current unvested Service Awards that are forfeited, canceled or expire will not be available for future grants.

Due to the LTIP expiring, we have no common units available for grant and any current unvested Service Awards that are forfeited or canceled will not be available for future grants.

Certain Relationships and Related Transactions, and Director Independence

22 unchanged sentences

Transactions with Related Persons

Guderian is a member of our board of directors and was an executive officer of WPX.

We purchase crude oil from and sell crude oil to WPX (certain of the purchases and sales that were entered into in contemplation of each other are recorded on a net basis within revenues in our consolidated statement of operations).

We also treat and dispose of produced water and solids received from WPX.

On January 7, 2021, Devon Energy Corporation (“Devon”) acquired WPX and Mr.

Guderian has since retired from WPX/Devon.

Due to his retirement, we will no longer be classifying transactions with WPX or Devon as related party transactions after December 31, 2020.

The following table summarizes transactions with WPX for the year ended March 31, 2021 (in thousands):

Sales to WPX $ 39,129

Purchases from WPX $ 216,487

Coady is a member of our board of directors and retired from being an executive officer of DCC effective December 31, 2020.

We sell propane to and purchase propane from DCC.

The following table summarizes transactions with DCC for the year ended March 31, 2021 (in thousands):

Sales to DCC $ 18,402

Purchases from DCC $ 428

To complete the issuance of the 2026 Senior Secured Notes and the ABL Facility (see Note 8 to our consolidated financial statements included in this Annual Report), we were required to receive the consent of EIG which are holders of our Class D Preferred Units and are represented on the board of directors of our general partner.

For their consent, we paid to EIG $40.0 million.

Other Transactions

We purchase goods and services from certain entities that are partially owned by our named executive officers.

The following table summarizes these transactions for the year ended March 31, 2021:

Entity Nature of Purchases Amount

Purchased Ownership Interest

The following table summarizes these transactions from April 1, 2021 to March 31, 2022:

Entity Nature of Purchases Amount Purchased Ownership Interest in Entity

(in thousands)

Michael Krimbill

KAIR2014 LLC Aircraft $ 760 50 %

KAIR2014 LLC (“KAIR2014”) Aircraft $ 670 50 %

In connection with the purchase of our 50% interest in an aircraft company, KAIR2014, we executed a joint and several guarantee for the benefit of the lender for KAIR2014’s outstanding loan.

The other owner of KAIR2014, our Chief Executive Officer, H.

Michael Krimbill, is a party to a similar guarantee.

This guarantee obligates us for the payment and performance of KAIR2014 with respect to the repayment of the loan.

As of March 31, 2022, the outstanding balance of the loan is approximately $2.5 million.

Payments are made monthly, reducing the outstanding balance, and the loan matures in September 2023.

As the guarantee is joint and several, we could be liable for the entire outstanding balance of the loan.

The loan is collateralized by the airplane owned by KAIR2014 and in the event of a default, the lender could seek payment in full from us.

As of March 31, 2022, no accrual has been recorded related to this guarantee.

Travis Krimbill, an employee of the Partnership, is the son of H.

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(1) Includes fees for audits of the Partnership’s financial statements, reviews of the related quarterly financial statements, and services that are normally provided by the independent accountants in connection with statutory and regulatory filings or engagements, including reviews of documents filed with the SEC and the preparation of letters to underwriters and other requesting parties.

(2) Includes fees in fiscal years 2021 and 2020 for review services for one of our subsidiaries.

(2) Includes fees in fiscal year 2021 for review services for one of our subsidiaries.

Audit Committee Approval of Audit and Non-Audit Services

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Any service that is not clearly enumerated in the policy must receive specific pre-approval by the audit committee prior to engagement.

Exhibits, Financial Statement Schedules

Exhibit and Financial Statement Schedules

(a) The following documents are filed as part of this Annual Report:

4 unchanged sentences

Exhibit Number Description

2.1 LLC Interest Transfer Agreement, dated as of August 1, 2013, by and among Oilfield Water Lines, LP, as the Representative, OWL Pearsall SWD, LLC, OWL Pearsall Holdings, LLC, NGL Energy Partners, LP and High Sierra Water-Eagle Ford, LLC (incorporated by reference to Exhibit 2.1 to the Current Report on Form 8-K (File No.

001-35172) filed with the SEC on August 7, 2013)

2.2 LLC Interest Transfer Agreement, dated as of August 1, 2013, by and among Oilfield Water Lines, LP, as the Representative, OWL Karnes SWD, LLC, OWL Karnes Holdings, LLC, NGL Energy Partners, LP and High Sierra Water-Eagle Ford, LLC (incorporated by reference to Exhibit 2.2 to the Current Report on Form 8-K (File No.

001-35172) filed with the SEC on August 7, 2013)

2.3 LLC Interest Transfer Agreement, dated as of August 1, 2013, by and among Oilfield Water Lines, LP, OWL Cotulla SWD, LLC, Terry Bailey, as trustee of the PJB Irrevocable Trust, NGL Energy Partners, LP and High Sierra Water-Eagle Ford, LLC (incorporated by reference to Exhibit 2.3 to the Current Report on Form 8-K (File No.

001-35172) filed with the SEC on August 7, 2013)

2.4 LLC Interest Transfer Agreement, dated as of August 1, 2013, by and among Oilfield Water Lines, LP, OWL Nixon SWD, LLC, Terry Bailey, as trustee of the PJB Irrevocable Trust, NGL Energy Partners, LP and High Sierra Water-Eagle Ford, LLC (incorporated by reference to Exhibit 2.4 to the Current Report on Form 8-K (File No.

001-35172) filed with the SEC on August 7, 2013)

2.5 LLC Interest Transfer Agreement, dated as of August 1, 2013, by and among Oilfield Water Lines, LP, HR OWL, LLC, OWL Operating, LLC, Lotus Oilfield Services, L.L.C., OWL Lotus, LLC, NGL Energy Partners, LP, High Sierra Water-Eagle Ford, LLC and High Sierra Transportation, LLC (incorporated by reference to Exhibit 2.5 to the Current Report on Form 8-K (File No.

001-35172) filed with the SEC on August 7, 2013)

2.6 Equity Interest Purchase Agreement, dated November 5, 2013, by and among NGL Energy Partners LP, High Sierra Energy, LP, Gavilon, LLC and Gavilon Energy Intermediate, LLC (incorporated by reference to Exhibit 2.1 to the Current Report on Form 8-K (File No.

001-35172) filed with the SEC on December 5, 2013)

2.1 Membership Interest Purchase Agreement, dated as of May 30, 2018, by and among NGL Energy Operating, LLC, NGL Energy Partners LP, and Superior Plus Energy Services Inc.

9 unchanged sentences

001-35172) filed with the SEC on November 1, 2019)

2.5 Membership Interest Purchase Agreement, dated as of June 18, 2021 (incorporated by reference to Exhibit 2.1 to the Current Report on Form 8-K (File No.

001-35172) filed with the SEC on June 21, 2021)

3.1 Certificate of Limited Partnership of NGL Energy Partners LP (incorporated by reference to Exhibit 3.1 to the Registration Statement on Form S-1 (File No.

14 unchanged sentences

001-35172) filed with the SEC on July 3, 2014)

Exhibit Number Description

3.8 Amendment No.

14 unchanged sentences

001-35172) filed with the SEC on February 8, 2021)

Exhibit Number Description

4.1 First Amended and Restated Registration Rights Agreement, dated October 3, 2011, by and among the Partnership, Hicks Oils & Hicksgas, Incorporated, NGL Holdings, Inc., Krim2010, LLC, Infrastructure Capital Management, LLC, Atkinson Investors, LLC, E.

41 unchanged sentences

001-35172) filed with the SEC on October 24, 2016)

Exhibit Number Description

4.14 Registration Rights Agreement, dated as of October 24, 2016, by and among NGL Energy Partners LP, NGL Energy Finance Corp., the guarantors listed therein on Exhibit A and Barclays Capital Inc.

16 unchanged sentences

001-35172) for the quarter ended December 31, 2019 filed with the SEC on February 6, 2020)

Exhibit Number Description

4.20 Sixth Supplemental Indenture, dated as of June 30, 2020, among NGL Energy Partners LP, NGL Energy Finance Corp., the Guaranteeing Subsidiaries party thereto, the Guarantors party thereto and U.S.

2 unchanged sentences

4.21 Seventh Supplemental Indenture, dated as of February 18, 2021, among NGL Energy Partners LP, NGL Energy Finance Corp., the Guaranteeing Subsidiaries party thereto, the Guarantors party thereto and U.S.

Bank National Association, as Trustee

Bank National Association, as Trustee (incorporated by reference to Exhibit 4.21 to the Annual Report on Form 10-K (File No.

001-35172) for the year ended March 31, 2021 filed with the SEC on June 3, 2021)

4.22* Eighth Supplemental Indenture, dated as of March 25, 2022 among NGL Energy Partners LP, NGL Energy Finance Corp., the Guaranteeing Subsidiaries party thereto, the Guarantors party thereto and U.S.

Bank Trust Company, National Association, as Trustee

4.23 Indenture, dated as of February 22, 2017, by and among NGL Energy Partners LP, NGL Energy Finance Corp., the guarantors party thereto and U.S.

21 unchanged sentences

4.31 Sixth Supplemental Indenture, dated as of February 18, 2021, among NGL Energy Partners LP, NGL Energy Finance Corp., the Guaranteeing Subsidiaries party thereto, the Guarantors party thereto and U.S.

Bank National Association, as Trustee

Bank National Association, as Trustee (incorporated by reference to Exhibit 4.30 to the Annual Report on Form 10-K (File No.

001-35172) for the year ended March 31, 2021 filed with the SEC on June 3, 2021)

4.32* Seventh Supplemental Indenture, dated as of March 25, 2022, among NGL Energy Partners LP, NGL Energy Finance Corp., the Guaranteeing Subsidiaries party thereto, the Guarantors party thereto and U.S.

Bank Trust Company, National Association, as Trustee

4.33 Indenture, dated as of April 9, 2019, by and among NGL Energy Partners LP, NGL Energy Finance Corp., the guarantors party thereto and U.S.

3 unchanged sentences

001-35172) filed with the SEC on April 9, 2019)

Exhibit Number Description

4.35 Registration Rights Agreement, dated as of April 9, 2019, by and among NGL Energy Partners LP, NGL Energy Finance Corp., the guarantors listed therein on Exhibit A and RBC Capital Markets, LLC and Mizuho Securities USA LLC, as representatives of the several initial purchasers (incorporated by reference to Exhibit 4.3 to the Current Report on Form 8-K (File No.

7 unchanged sentences

4.38 Third Supplemental Indenture, dated as of June 30, 2020, among NGL Energy Partners LP, NGL Energy Finance Corp., the Guaranteeing Subsidiaries party thereto, the Guarantors party thereto and U.S.

Bank National Association, as Trustee (incorporated by reference to Exhibit 4.

3 to the Quarterly Report on Form 10-Q (File No.

Bank National Association, as Trustee (incorporated by reference to Exhibit 4.3 to the Quarterly Report on Form 10-Q (File No.

001-35172) for the quarter ended June 30, 2020 filed with the SEC on August 10, 2020)

Exhibit Number Description

4.39 Fourth Supplemental Indenture, dated as of February 18, 2021, among NGL Energy Partners LP, NGL Energy Finance Corp., the Guaranteeing Subsidiaries party thereto, the Guarantors party thereto and U.S.

Bank National Association, as Trustee

Bank National Association, as Trustee (incorporated by reference to Exhibit 4.37 to the Annual Report on Form 10-K (File No.

001-35172) for the year ended March 31, 2021 filed with the SEC on June 3, 2021)

4.40* Fifth Supplemental Indenture, dated as of March 25, 2022, among NGL Energy Partners LP, NGL Energy Finance Corp., the Guaranteeing Subsidiaries party thereto, the Guarantors party thereto and U.S.

Bank Trust Company, National Association, as Trustee

4.41 Indenture, dated as of February 4, 2021, by and among NGL Energy Operating LLC, NGL Energy Finance Corp., the guarantors party thereto and U.S.

3 unchanged sentences

001-35172) filed with the SEC on February 8, 2021)

4.43* First Supplemental Indenture, dated as of March 28, 2022, among NGL Shared Services, LLC, NGL Shared Services Holdings, Inc., NGL Energy Operating LLC, NGL Energy Finance Corp., the other Guarantors and U.S.

Bank Trust Company, National Association, as Trustee

4.44 Amended and Restated Guaranty Agreement, dated as of March 31, 2017 and effective as of December 31, 2016, among NGL Energy Partners LP and the purchasers named therein (incorporated by reference to Exhibit 4.1 to the Quarterly Report on Form 10-Q (File No.

9 unchanged sentences

001-35172) filed with the SEC on February 8, 2021)

10.2 First Amendment to Credit Agreement (incorporated by reference to Exhibit 10.1 to the Quarterly Report on Form 10-Q (File No.

001-35172) for the quarter ended September 30, 2021 filed with the SEC on November 9, 2021)

10.3* Second Amendment to Credit Agreement

10.4* Credit Party Accession Agreement, dated as of March 28, 2022, among NGL Shared Services, LLC, NGL Shared Services Holdings, Inc., and JPMorgan Chase Bank, N.A., as Administrative Agent and as Collateral Agent

10.5 Common Unit Purchase Agreement, dated November 5, 2013, by and among NGL Energy Partners LP and the purchasers listed on Schedule A thereto (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K (File No.

21 unchanged sentences

001-35172) filed with the SEC on September 30, 2019)

Exhibit Number Description

10.15 Form of Par Warrant (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K (File No.

001-35172) filed with the SEC on November 1, 2019)

Exhibit Number Description

10.16 Form of Premium Warrant (incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K (File No.

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** The following documents are formatted in Inline XBRL (Extensible Business Reporting Language):

(i) Consolidated Balance Sheets at March 31, 2021 and 2020, (ii) Consolidated Statements of Operations for the years ended March 31, 2021, 2020, and 2019, (iii) Consolidated Statements of Comprehensive (Loss) Income for the years ended March 31, 2021, 2020, and 2019, (iv) Consolidated Statements of Changes in Equity for the years ended March 31, 2021, 2020, and 2019, (v) Consolidated Statements of Cash Flows for the years ended March 31, 2021, 2020, and 2019, and (vi) Notes to Consolidated Financial Statements.

(i) Consolidated Balance Sheets at March 31, 2022 and 2021, (ii) Consolidated Statements of Operations for the years ended March 31, 2022, 2021, and 2020, (iii) Consolidated Statements of Comprehensive Loss for the years ended March 31, 2022, 2021, and 2020, (iv) Consolidated Statements of Changes in Equity for the years ended March 31, 2022, 2021, and 2020, (v) Consolidated Statements of Cash Flows for the years ended March 31, 2022, 2021, and 2020, and (vi) Notes to Consolidated Financial Statements.

+ Management contracts or compensatory plans or arrangements.

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Michael Krimbill (Principal Executive Officer)

/s/ Robert W.

Karlovich III Chief Financial Officer June 3, 2021

Karlovich III (Principal Financial Officer)

Bridges Chief Financial Officer June 6, 2022

Bridges (Principal Financial Officer)

/s/ Lawrence J.

13 unchanged sentences

NGL Energy Partners LP

Report of Independent Registered Public Accounting Firm F- 2

Consolidated Balance Sheets at March 31, 2021 and 2020 F- 4

Consolidated Statements of Operations for the years ended March 31, 2021, 2020, and 2019 F- 5

Consolidated Statements of Comprehensive (Loss) Income for the years ended March 31, 2021, 2020, and 2019 F- 6

Consolidated Statements of Changes in Equity for the years ended March 31, 2021, 2020, and 2019 F- 7

Consolidated Statements of Cash Flows for the years ended March 31, 2021, 2020, and 2019 F- 8

Report of Independent Registered Public Accounting Firm (PCAOB ID Number 248 )

Consolidated Balance Sheets at March 31, 2022 and 2021

Consolidated Statements of Operations for the years ended March 31, 2022, 2021, and 2020

Consolidated Statements of Comprehensive Loss for the years ended March 31, 2022, 2021, and 2020

Consolidated Statements of Changes in Equity for the years ended March 31, 2022, 2021, and 2020

Consolidated Statements of Cash Flows for the years ended March 31, 2022, 2021, and 2020

Notes to Consolidated Financial Statements F- 9

3 unchanged sentences

Opinion on the financial statements

We have audited the accompanying consolidated balance sheets of NGL Energy Partners LP (a Delaware limited partnership) and subsidiaries (the “Partnership”) as of March 31, 2021 and 2020, the related consolidated statements of operations, comprehensive (loss) income, changes in equity, and cash flows for each of the three years in the period ended March 31, 2021, and the related notes (collectively referred to as the “financial statements”).

We have audited the accompanying consolidated balance sheets of NGL Energy Partners LP (a Delaware limited partnership) and subsidiaries (the “Partnership”) as of March 31, 2022 and 2021, the related consolidated statements of operations, comprehensive loss, changes in equity, and cash flows for each of the three years in the period ended March 31, 2022, and the related notes (collectively referred to as the “financial statements”).

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Partnership as of March 31, 2022 and 2021, and the results of its operations and its cash flows for each of the three years in the period ended March 31, 2022, in conformity with accounting principles generally accepted in the United States of America.

16 unchanged sentences

Goodwill Impairment Assessment

As described further in Note 6 to the financial statements, the Partnership’s consolidated goodwill balance was $744.4 million as of March 31, 2021.

As described further in Note 5 to the consolidated financial statements, the Partnership’s consolidated goodwill balance was $744.4 million as of March 31, 2022.

Management evaluates goodwill for impairment on January 1 of each year, or more frequently to the extent events or conditions indicate a risk of possible impairment.

Based on events occurring during the three months ended December 31, 2020, management performed a quantitative impairment assessment for the Crude Oil Logistics reporting unit to test goodwill for impairment.

Further, management performed a quantitative impairment assessment for the Water Solutions reporting unit to test goodwill for impairment as of January 1, 2021.

As a result of the assessments performed for the reporting units, and as described further in Note 6 to the financial statements, the Partnership recognized a goodwill impairment charge of $ 237.8 million as of December 31, 2020 related to its Crude Oil Logistics reporting unit within the Partnership’s Crude Oil Logistics reportable segment primarily due to changes in assumptions related to the projected future revenues and cash flows from the dates the goodwill was originally recorded.

Management performed a quantitative impairment assessment for the Crude Oil Logistics reporting unit to test goodwill for impairment as of January 1, 2022.

As a result of the assessment performed for the reporting unit, and as described further in Note 5 to the consolidated financial statements, the Partnership concluded the fair value of the Crude Oil Logistics reporting unit exceeded its carrying value and no goodwill impairment was recorded.

We identified the goodwill impairment assessment as a critical audit matter.

The principal considerations for our determination that the goodwill impairment assessment was a critical audit matter are that there was a high estimation uncertainty due to significant judgments with respect to assumptions used to estimate the future revenues and cash flows, including revenue growth rates, operating expenses and cash outflows necessary to support the cash flows, weighted average costs of capital and future market conditions as well as the valuation methodologies applied by the Partnership.

This in turn led to a high degree of auditor judgment, subjectivity and effort in performing procedures and

evaluating audit evidence related to management’s forecasted future revenues and cash flows.

This in turn led to a high degree of auditor judgment, subjectivity and effort in performing procedures and evaluating audit evidence related to management’s forecasted future revenues and cash flows.

In addition, the audit effort involved the use of professionals with specialized skill and knowledge to assist in performing these procedures and evaluating the audit evidence obtained.

Our audit procedures related to the goodwill impairment assessment included the following, among others.

We tested the effectiveness of controls relating to management’s goodwill impairment tests, including controls over the determination of the fair value of the reporting units.

We tested the effectiveness of controls relating to management’s goodwill impairment tests, including controls over the determination of the fair value of the reporting unit.

In addition to testing the effectiveness of controls, we also performed the following:

3 unchanged sentences

◦ Other significant assumptions, including the terminal growth rate.

• Tested the reasonableness of management’s process for determining the fair value of the reporting units, including the revenue growth rate, forecasted costs and operating margins by comparing such items to the industry projections and conditions found in industry reports as well as historical operating results of the reporting units and by assessing the likelihood or capability of the reporting unit to undertake activities or initiatives underpinning significant drivers of growth in the forecasted period.

• Tested the reasonableness of management’s process for determining the fair value of the reporting unit, including the revenue growth rate, forecasted costs and operating margins by comparing such items to the industry projections and conditions found in industry reports as well as historical operating results of the reporting unit and by assessing the likelihood or capability of the reporting unit to undertake activities or initiatives underpinning significant drivers of growth in the forecasted period.

/s/ GRANT THORNTON LLP

58 unchanged sentences

Liquids Logistics 4,897,553 3,133,146 4,611,136

Other 1,255 1,038 1,362

Corporate and Other — 1,255 1,038

Total Revenues 7,947,915 5,227,023 7,584,000

3 unchanged sentences

Liquids Logistics 4,752,400 2,966,391 4,342,526

Other 1,816 1,774 1,929

Corporate and Other — 1,816 1,774

Total Cost of Sales 7,139,312 4,493,822 6,604,383

5 unchanged sentences

Revaluation of liabilities ( 6,495 ) 6,261 9,194

Operating (Loss) Income ( 390,753 ) ( 3,332 ) 126,728

Operating Income (Loss) 83,043 ( 390,753 ) ( 3,332 )

OTHER INCOME (EXPENSE):

1 unchanged sentence

Interest expense ( 271,640 ) ( 198,799 ) ( 181,184 )

(Loss) gain on early extinguishment of liabilities, net ( 16,692 ) 1,341 ( 12,340 )

Other (expense) income, net ( 36,503 ) 1,684 ( 30,418 )

Gain (loss) on early extinguishment of liabilities, net 1,813 ( 16,692 ) 1,341

Other income (expense), net 2,254 ( 36,503 ) 1,684

Loss From Continuing Operations Before Income Taxes ( 183,130 ) ( 640,809 ) ( 180,200 )

INCOME TAX BENEFIT (EXPENSE) 3,391 ( 345 ) ( 1,233 )

INCOME TAX (EXPENSE) BENEFIT ( 971 ) 3,391 ( 345 )

Loss From Continuing Operations ( 184,101 ) ( 637,418 ) ( 180,545 )

(Loss) Income From Discontinued Operations, net of Tax ( 1,769 ) ( 218,235 ) 418,850

Net (Loss) Income ( 639,187 ) ( 398,780 ) 339,395

Loss From Discontinued Operations, net of Tax — ( 1,769 ) ( 218,235 )

Net Loss ( 184,101 ) ( 639,187 ) ( 398,780 )

NET (INCOME) LOSS ATTRIBUTABLE TO NONCONTROLLING INTERESTS ( 655 ) ( 632 ) 1,773

NET LOSS ATTRIBUTABLE TO REDEEMABLE NONCONTROLLING INTERESTS — — 446

NET (LOSS) INCOME ATTRIBUTABLE TO NGL ENERGY PARTNERS LP $ ( 639,819 ) $ ( 397,007 ) $ 360,047

NET LOSS ATTRIBUTABLE TO NGL ENERGY PARTNERS LP $ ( 184,756 ) $ ( 639,819 ) $ ( 397,007 )

NET LOSS FROM CONTINUING OPERATIONS ALLOCATED TO COMMON UNITHOLDERS (NOTE 3) $ ( 288,630 ) $ ( 730,683 ) $ ( 367,246 )

NET (LOSS) INCOME FROM DISCONTINUED OPERATIONS ALLOCATED TO COMMON UNITHOLDERS (NOTE 3) $ ( 1,767 ) $ ( 218,017 ) $ 418,877

NET (LOSS) INCOME ALLOCATED TO COMMON UNITHOLDERS (NOTE 3) $ ( 732,450 ) $ ( 585,263 ) $ 247,724

BASIC (LOSS) INCOME PER COMMON UNIT

NET LOSS FROM DISCONTINUED OPERATIONS ALLOCATED TO COMMON UNITHOLDERS (NOTE 3) $ — $ ( 1,767 ) $ ( 218,017 )

NET LOSS ALLOCATED TO COMMON UNITHOLDERS (NOTE 3) $ ( 288,630 ) $ ( 732,450 ) $ ( 585,263 )

BASIC LOSS PER COMMON UNIT

Loss From Continuing Operations $ ( 2.22 ) $ ( 5.67 ) $ ( 2.88 )

(Loss) Income From Discontinued Operations, net of Tax $ ( 0.01 ) $ ( 1.71 ) $ 3.41

Net (Loss) Income $ ( 5.68 ) $ ( 4.59 ) $ 2.01

DILUTED (LOSS) INCOME PER COMMON UNIT

Loss From Discontinued Operations, net of Tax $ — $ ( 0.01 ) $ ( 1.71 )

Net Loss $ ( 2.22 ) $ ( 5.68 ) $ ( 4.59 )

DILUTED LOSS PER COMMON UNIT

Loss From Continuing Operations $ ( 2.22 ) $ ( 5.67 ) $ ( 2.88 )

(Loss) Income From Discontinued Operations, net of Tax $ ( 0.01 ) $ ( 1.71 ) $ 3.41

Net (Loss) Income $ ( 5.68 ) $ ( 4.59 ) $ 2.01

Loss From Discontinued Operations, net of Tax $ — $ ( 0.01 ) $ ( 1.71 )

Net Loss $ ( 2.22 ) $ ( 5.68 ) $ ( 4.59 )

BASIC WEIGHTED AVERAGE COMMON UNITS OUTSTANDING 129,840,234 128,980,823 127,411,908

2 unchanged sentences

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Consolidated Statements of Comprehensive (Loss) Income

Consolidated Statements of Comprehensive Loss

(in Thousands)

1 unchanged sentence

2022 2021 2020

Net (loss) income $ ( 639,187 ) $ ( 398,780 ) $ 339,395

Other comprehensive income (loss) 119 ( 130 ) ( 9 )

Comprehensive (loss) income $ ( 639,068 ) $ ( 398,910 ) $ 339,386

Net loss $ ( 184,101 ) $ ( 639,187 ) $ ( 398,780 )

Other comprehensive (loss) income ( 42 ) 119 ( 130 )

Comprehensive loss $ ( 184,143 ) $ ( 639,068 ) $ ( 398,910 )

The accompanying notes are an integral part of these consolidated financial statements.

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Distributions to general and common unit partners and preferred unitholders (Note 9) ( 342 ) — — — ( 258,020 ) — — ( 258,362 )

Contributions — — — — — — 169 169

Sawtooth joint venture (Note 18) — — — — ( 63 ) — ( 791 ) ( 854 )

Purchase of noncontrolling interest — — — — ( 33 ) — ( 3,927 ) ( 3,960 )

Redeemable noncontrolling interest valuation adjustment — — — — ( 3,349 ) — — ( 3,349 )

Repurchase of warrants (Note 10) — — — — ( 14,988 ) — — ( 14,988 )

Common unit repurchases and cancellations — — — ( 26,993 ) ( 297 ) — — ( 297 )

Equity issued pursuant to incentive compensation plan (Note 10) 22 — — 2,833,968 39,712 — — 39,734

Warrants exercised (Note 10) — — — 228,797 2 — — 2

Accretion of beneficial conversion feature of 10.75 % Class A convertible preferred units (Note 10)

— — — — ( 67,239 ) — — ( 67,239 )

Net income (loss) 387 — — — 359,660 — ( 20,206 ) 339,841

Other comprehensive loss — — — — — ( 9 ) — ( 9 )

Cumulative effect adjustment for adoption of ASC 606 139 — — — 139,167 — — 139,306

Cumulative effect adjustment for adoption of ASU 2016-01 ( 2 ) — — — ( 1,567 ) 1,569 — —

BALANCES AT MARCH 31, 2019 ( 50,603 ) 8,400,000 202,731 124,508,497 2,067,197 ( 255 ) 58,748 2,277,818

Distributions to general and common unit partners and preferred unitholders (Note 10) ( 342 ) — — — ( 258,020 ) — — ( 258,362 )

Distributions to noncontrolling interest owners — — — — — — ( 1,145 ) ( 1,145 )

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— — — — ( 78,797 ) — — ( 78,797 )

Equity issued pursuant to incentive compensation plan (Note 10) 33 — — 2,938,481 32,931 — — 32,964

Equity issued pursuant to incentive compensation plan 33 — — 2,938,481 32,931 — — 32,964

Common unit repurchases and cancellations — — — ( 133,634 ) ( 1,644 ) — — ( 1,644 )

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Distributions to noncontrolling interest owners — — — — — — ( 4,115 ) ( 4,115 )

Common unit repurchases and cancellations (Note 10) — — — ( 70,226 ) ( 182 ) — — ( 182 )

Equity issued pursuant to incentive compensation plan (Note 10) — — — 892,450 4,727 — — 4,727

Common unit repurchases and cancellations — — — ( 70,226 ) ( 182 ) — — ( 182 )

Equity issued pursuant to incentive compensation plan — — — 892,450 4,727 — — 4,727

Net (loss) income ( 733 ) — — — ( 639,086 ) — 632 ( 639,187 )

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BALANCES AT MARCH 31, 2021 ( 52,189 ) 14,385,642 348,359 129,593,939 582,784 ( 266 ) 69,471 948,159

Distributions to noncontrolling interest owners — — — — — — ( 1,635 ) ( 1,635 )

Sawtooth joint venture disposition (Note 17) — — — — — — ( 51,097 ) ( 51,097 )

Common unit repurchases and cancellations (Note 9) — — — ( 44,769 ) ( 90 ) — — ( 90 )

Equity issued pursuant to incentive compensation plan (Note 9) — — — 1,146,800 3,259 — — 3,259

Net (loss) income ( 289 ) — — — ( 184,467 ) — 655 ( 184,101 )

Other comprehensive loss — — — — — ( 42 ) — ( 42 )

BALANCES AT MARCH 31, 2022 $ ( 52,478 ) 14,385,642 $ 348,359 130,695,970 $ 401,486 $ ( 308 ) $ 17,394 $ 714,453

The accompanying notes are an integral part of these consolidated financial statements.

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OPERATING ACTIVITIES:

Net (loss) income $ ( 639,187 ) $ ( 398,780 ) $ 339,395

Adjustments to reconcile net (loss) income to net cash provided by operating activities:

Loss (income) from discontinued operations, net of tax 1,769 218,235 ( 418,850 )

Net loss $ ( 184,101 ) $ ( 639,187 ) $ ( 398,780 )

Adjustments to reconcile net loss to net cash provided by operating activities:

Loss from discontinued operations, net of tax — 1,769 218,235

Depreciation and amortization, including amortization of debt issuance costs 306,208 331,200 276,848

Loss on early extinguishment or revaluation of liabilities, net 22,953 7,853 6,967

(Gain) loss on early extinguishment or revaluation of liabilities, net ( 8,308 ) 22,953 7,853

Non-cash equity-based compensation expense ( 1,052 ) 6,727 26,510

Loss on disposal or impairment of assets, net 94,254 475,436 261,786

Provision for expected credit losses 5,988 1,002 381

Change in provision for expected credit losses 929 5,988 1,002

Net adjustments to fair value of commodity derivatives 116,556 83,578 ( 85,941 )

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Repayments on loan for natural gas liquids facility — — 3,022

Loan to affiliate — — ( 1,515 )

Net cash used in investing activities-continuing operations ( 212,408 ) ( 221,493 ) ( 1,737,620 )

Net cash provided by investing activities-discontinued operations — — 298,864

Net cash (used in) provided by investing activities ( 221,493 ) ( 1,438,756 ) 453,473

Net cash used in investing activities ( 212,408 ) ( 221,493 ) ( 1,438,756 )

FINANCING ACTIVITIES:

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Debt issuance costs ( 12,932 ) ( 65,566 ) ( 14,950 )

Contributions from noncontrolling interest owners, net — — 169

Distributions to general and common unit partners and preferred unitholders — ( 142,128 ) ( 244,400 )

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Payments for redemption of preferred units — — ( 265,128 )

Repurchase of warrants — — ( 14,988 )

Common unit repurchases and cancellations ( 90 ) ( 182 ) ( 1,644 )

Payments for settlement and early extinguishment of liabilities ( 95,437 ) ( 98,958 ) ( 4,577 )

Payments to settle contingent consideration liabilities ( 1,231 ) ( 95,437 ) ( 98,958 )

Investment in NGL Energy Holdings LLC — — ( 15,226 )

Net cash (used in) provided by financing activities-continuing operations ( 100,376 ) 978,833 ( 793,920 )

Net cash used in financing activities-discontinued operations — — ( 325 )

Net cash (used in) provided by financing activities ( 100,376 ) 978,833 ( 794,245 )

Net cash provided by (used in) financing activities 5,555 ( 100,376 ) 978,833

Net (decrease) increase in cash and cash equivalents ( 1,007 ) ( 17,875 ) 4,132

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Supplemental non-cash investing and financing activities:

Distributions declared but not paid to Class B, Class C and Class D preferred unitholders $ 13,814 $ 18,687 $ 4,725

Distributions declared but not paid to preferred unitholders $ — $ 13,814 $ 18,687

Accrued capital expenditures $ 14,558 $ 21,824 $ 88,917

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At March 31, 2022, our operations included 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.

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.

Note 2— Significant Accounting Policies

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The preparation of consolidated financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the amount of assets and liabilities reported at the date of the consolidated financial statements and the amount of revenues and expenses reported during the periods presented.

Critical estimates we make in the preparation of our consolidated financial statements include, among others, determining the fair value of assets and liabilities acquired in acquisitions, the fair value of derivative instruments, the collectibility of accounts receivable, the recoverability of inventories, useful lives and recoverability of property, plant and equipment and amortizable intangible assets, the impairment of long-lived assets and goodwill, the fair value of asset retirement obligations, the value of equity-based compensation, accruals for environmental matters and estimating certain revenues.

Critical accounting estimates we make in the preparation of our consolidated financial statements include, among others, determining the impairment of goodwill and long-lived assets, useful lives and recoverability of property, plant and equipment and amortizable intangible assets, the fair value of derivative instruments, estimating certain revenues, the fair value of asset retirement obligations, the fair value of assets and liabilities acquired in acquisitions, the recoverability of inventories, the collectibility of accounts and notes receivable and accruals for environmental matters.

Although we believe these estimates are reasonable, actual results could differ from those estimates.

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Derivative Financial Instruments

We record all derivative financial instrument contracts at fair value in our consolidated balance sheets except for certain physical contracts that qualify for the normal purchase and normal sale election.

Under this accounting policy election, we do not record the physical contracts at fair value at each balance sheet date;

We record all derivative financial instrument contracts at fair value in our consolidated balance sheets except for normal purchase and normal sale transactions that are expected to result in physical delivery.

For these transactions, we do not record the physical contracts at fair value at each balance sheet date;

instead, we record the purchase or sale at the contracted value once the delivery occurs.

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We utilize the asset and liability method of accounting for income taxes.

Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases.

Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying value of existing assets and liabilities and their respective tax bases.

Deferred tax assets and liabilities are measured using enacted tax rates expected to apply in the years in which these temporary differences are expected to be recovered or settled.

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Income generated by our taxable corporate subsidiaries is excluded from this qualifying income calculation.

Although we routinely generate income outside of our corporate subsidiaries that is non-qualifying, we believe that at least 90 % of our gross income has been qualifying income for each of the calendar years since our IPO.

We have a deferred tax liability of $ 45.8 million and $ 56.4 million at March 31, 2021 and 2020, respectively, as a result of acquiring corporations in connection with certain of our acquisitions (see Note 4), which is included within other noncurrent liabilities in our consolidated balance sheets.

We have a deferred tax liability of $ 43.5 million and $ 45.8 million at March 31, 2022 and 2021, respectively, as a result of acquiring corporations in connection with certain of our acquisitions, which is included within other noncurrent liabilities in our consolidated balance sheets.

The deferred tax liability is the tax effected cumulative temporary difference between the GAAP basis and tax basis of the acquired assets within the corporation.

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A tax position that meets the more likely than not threshold is measured to determine the amount of benefit to be recognized in the consolidated financial statements.

We had no material uncertain tax positions that required recognition in our consolidated financial statements at March 31, 2021 or 2020.

We had no uncertain tax positions that required recognition in our consolidated financial statements at March 31, 2022 or 2021.

Cash and Cash Equivalents

Cash and cash equivalents include cash on hand, demand and time deposits, and funds invested in highly liquid instruments with maturities of three months or less at the date of purchase.

At times, certain account balances may exceed federally insured limits.

Management considers all highly liquid investments with a maturity of three months or less, when purchased, to be cash equivalents.

We place our cash and cash equivalents with financial institutions that are insured by the Federal Deposit Insurance Corporation;

however, we maintain deposits in banks which exceed the amount of deposit insurance available.

Management routinely assesses the financial condition of the institutions and believes that any possible credit loss would be minimal.

Accounts Receivable and Concentration of Credit Risk

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Receivables and payables are reflected at a net balance to the extent a netting agreement is in place and we intend to settle on a net basis.

We did not have any customers that represented over 10% of consolidated revenues for fiscal years 2021, 2020 and 2019.

CITGO Petroleum Corporation accounted for 12.8 % of our consolidated revenues for the year ended March 31, 2022.

The majority of the revenue for this customer pertains to our Crude Oil Logistics segment activities, and sales to this customer

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

occur mainly out of our crude oil terminal in Cushing, Oklahoma.

We did not have any customers that represented over 10% of consolidated revenues for the years ended March 31, 2021 and 2020.

Our inventories are valued at the lower of cost or net realizable value, with cost determined using either the weighted-average cost or the first in, first out (FIFO) methods, including the cost of transportation and storage, and with net realizable value defined as the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation.

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Biodiesel 20,474 16,169

Ethanol 3,056 1,834

Diesel 3,504 2,252

Ethanol 3,503 3,056

Other 11,196 7,364

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Our investments in unconsolidated entities consist of the following at the dates indicated:

Ownership March 31,

Entity Segment Interest (1) Date Acquired 2021 2020

Entity Segment Ownership Interest 2022 2021

(in thousands)

Water services and land company Water Solutions 50 % November 2019 $ 15,832 $ 16,607

Water services and land company Water Solutions 50 % November 2019 2,284 2,092

Water services and land company Water Solutions 10 % November 2019 3,254 3,384

Aircraft company (2) Corporate and Other 50 % June 2019 748 447

Water services company Water Solutions 50 % August 2018 424 449

Natural gas liquids terminal company Liquids Logistics 50 % March 2019 177 203

Water services and land company Water Solutions 50 % $ 15,714 $ 15,832

Water services and land company Water Solutions 10 % 2,863 3,254

Water services and land company Water Solutions 50 % 2,210 2,284

Aircraft company (1) Corporate and Other 50 % 538 748

Water services company Water Solutions 50 % 409 424

Natural gas liquids terminal company Liquids Logistics 50 % 163 177

Total $ 21,897 $ 22,719

(1) Ownership interest percentages are at March 31, 2021.

(1) This is an investment with a related party.

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(in thousands)

Loan receivable (1) $ 2,962 $ 5,374

Line fill (2) 28,110 25,763

Linefill (1) $ 28,065 $ 28,110

Minimum shipping fees - pipeline commitments (2) 8,899 13,171

Loan receivable (3) 3,147 2,962

Other 5,691 6,490

Total $ 45,802 $ 50,733

(1) Amounts at March 31, 2021 and 2020 represent the noncurrent portion of a loan receivable, net of an allowance for an expected credit loss, with a former related party.

In addition, the amount at March 31, 2020 represents the noncurrent portion of a loan receivable associated with our interest in the construction of a natural gas liquids loading/unloading facility (the “Facility”) that is utilized by a third party.

The third party filed for Chapter 11 bankruptcy in July 2019.

For a further discussion, see Note 18.

(1) Represents minimum volumes of product we are required to leave on certain third-party owned pipelines under long-term shipment commitments.

At March 31, 2021, line fill consisted of 423,978 barrels of crude oil.

At March 31, 2020, line fill consisted of 335,069 barrels of crude oil and 262,000 barrels of propane.

Line fill held in pipelines we own is included within property, plant and equipment (see Note 5).

During the three months ended March 31, 2020, we recorded an impairment of $ 7.7 million primarily due to adjusting the cost basis of pipeline line fill to the market price of propane as of March 31, 2020.

(3) Represents the noncurrent portion of minimum shipping fees paid in excess of volumes shipped, or deficiency credits, for one contract with a crude oil pipeline operator.

At March 31, 2022 and 2021, linefill consisted of 423,978 barrels of crude oil.

Linefill held in pipelines we own is included within property, plant and equipment (see Note 4).

During the three months ended March 31, 2020, we recorded an impairment of $ 7.7 million primarily due to adjusting the cost basis of pipeline linefill to the market price of propane as of March 31, 2020.

(2) Represents the noncurrent portion of minimum shipping fees paid in excess of volumes shipped, or deficiency credits, for a contract with a crude oil pipeline operator.

This amount can be recovered when volumes shipped exceed the minimum monthly volume commitment (see Note 8).

As of March 31, 2022, the deficiency credit was $ 13.2 million, of which $ 4.3 million is recorded within prepaid expenses and other current assets in our consolidated balance sheet.

(3) Represents the noncurrent portion of a loan receivable, net of an allowance for an expected credit loss, with a former related party.

Accrued Expenses and Other Payables

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Accrued interest $ 56,104 $ 56,299

Accrued compensation and benefits 41,456 29,990

Derivative liabilities 27,108 21,562

Accrued compensation and benefits 18,417 41,456

Excise and other tax liabilities 10,451 10,970

Contingent consideration liability (1) 3,083 102,419

Product exchange liabilities 853 1,188

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Total $ 140,719 $ 170,400

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

(1) Decrease is due to the monthly installment payments totaling $ 100.0 million made during the year ended March 31, 2021 related to our acquisition of certain assets of Mesquite.

We made our last installment payment in December 2020.

Property, Plant and Equipment

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Acquisitions and improvements are capitalized, and maintenance and repairs are expensed as incurred.

As we dispose of assets, we remove the cost and related accumulated depreciation from the accounts, and any resulting gain or loss is included within loss on disposal or impairment of assets, net.

As we dispose of assets, we remove the cost and related accumulated depreciation from the accounts, and any resulting gain or loss is included within loss on disposal or impairment of

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

We compute depreciation expense of our property, plant and equipment using the straight-line method over the estimated useful lives of the assets (see Note 4).

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Our intangible assets include contracts and arrangements acquired in business combinations, including customer relationships, customer commitments, pipeline capacity rights, rights-of-way and easements, water rights, executory contracts and other agreements, covenants not to compete, and trade names.

In addition, we capitalize certain debt issuance costs associated with the Revolving Credit Facility (as defined herein), ABL Facility (as defined herein) and the Sawtooth Caverns, LLC (“Sawtooth”) credit agreement.

In addition, we capitalize certain debt issuance costs associated with the ABL Facility (as defined herein) and the Sawtooth Caverns, LLC (“Sawtooth”) credit agreement.

We amortize the majority of our intangible assets on a straight-line basis over the estimated useful lives of the assets (see Note 6).

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A long-lived asset group is considered impaired when the anticipated undiscounted future cash flows from the use and eventual disposition of the asset group is less than its carrying value.

In that event, we recognize a loss equal to the amount by which the carrying value exceeds the fair value of the asset group.

If the carrying value is not recoverable, an impairment loss is measured as the excess of the asset’s carrying value over its estimated fair value.

When we cease to use an acquired trade name, we test the trade name for impairment using the relief from royalty method and we begin amortizing the trade name over its estimated useful life as a defensive asset.

See Note 4 and Note 6 for a further discussion of long-lived asset impairments recognized in the consolidated statements of operations.

We evaluate our equity method investments for impairment when we believe the current fair value may be less than the carrying amount and record an impairment if we believe the decline in value is other than temporary.

We evaluate our investments in unconsolidated entities for impairment whenever events or changes in circumstances indicate, in management’s judgment, that the fair value of such investment may have experienced a decline to less than its carrying value and the decline is other than temporary.

Goodwill represents the excess of the consideration paid for the acquired businesses over the fair value of the individual assets acquired, net of liabilities assumed.

Business combinations are accounted for using the “acquisition method” (see Note 4).

Business combinations are accounted for using the “acquisition method”.

We expect that all of our goodwill at March 31, 2022 is deductible for federal income tax purposes.

Goodwill and indefinite-lived intangible assets are not amortized, but instead are evaluated for impairment at least annually.

We perform our annual assessment of impairment during the fourth quarter of our fiscal year, and more frequently if circumstances warrant.

To perform this assessment, we first consider qualitative factors to determine whether it is more likely than not that the fair value of each reporting unit exceeds its carrying amount.

If we conclude that it is more likely than not that the fair value of a reporting unit does not exceed its carrying amount, we calculate the fair value for the reporting unit and compare the amount to its carrying amount, including goodwill.

If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is not considered impaired.

If the carrying amount of a reporting unit exceeds its fair value, goodwill is considered to be impaired and the goodwill balance is reduced by the difference between the fair value and carrying amount of the reporting unit.

We perform our annual assessment of impairment on January 1 of our fiscal year, and more frequently if circumstances warrant.

For purposes of the goodwill impairment assessment, assets are grouped into “reporting units.” A reporting unit is either an operating segment or a component of an operating segment, depending on how similar the components of the operating segment are to each other in terms of operational and economic characteristics.

For each reporting unit, we perform a qualitative assessment of relevant events and circumstances about the likelihood of goodwill impairment.

If it is deemed more likely than not that the fair value of the reporting unit is less than its carrying value, we calculate the fair value of the reporting unit.

Otherwise, further testing is not required.

If the fair value of the reporting unit (including its inherent goodwill) is less than its carrying value, goodwill is considered to be impaired and the goodwill balance is reduced by the difference between the fair value and carrying value of the reporting unit.

Estimates and assumptions used to perform the impairment evaluation are inherently uncertain and can significantly affect the outcome of the analysis.

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See Note 5 for a further discussion and analysis of our goodwill impairment assessment.

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

Product Exchanges

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We estimate the value of product exchange assets and liabilities based on the weighted-average cost basis of the inventory we have delivered or will deliver on the exchange, plus or minus location differentials.

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

Noncontrolling Interests

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Noncontrolling interests are reported as a component of equity, unless the noncontrolling interest is considered redeemable, in which case the noncontrolling interest is recorded between liabilities and equity (mezzanine or temporary equity) in our consolidated balance sheet.

The redeemable noncontrolling interest is adjusted at each balance sheet date to its maximum redemption value if the amount is greater than the carrying value.

To determine if a transaction should be accounted for as a business combination or an acquisition of assets, we first calculate the relative fair values of the assets acquired.

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Pursuant to GAAP, an entity is allowed a reasonable period of time (not to exceed one year) to obtain the information necessary to identify and measure the fair value of the assets acquired and liabilities assumed in a business combination.

Also, as discussed in Note 4, we made certain adjustments during the year ended March 31, 2021 to our estimates of the acquisition date fair values of the assets acquired and liabilities assumed in business combinations that occurred during the year ended March 31, 2020.

Reclassifications

We have reclassified certain prior period financial statement information to be consistent with the classification methods used in the current fiscal year.

These reclassifications did not impact previously reported amounts of assets, liabilities, equity, net income or cash flows.

Recent Accounting Pronouncements

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The guidance is effective for fiscal periods ending on or after August 9, 2021, although early adoption is permitted if an entity complies with an amended Item in its entirety.

Effective March 31, 2021, we adopted a portion of this guidance by electing to comply with guidance related to Item 301, which eliminated the Selected Financial Data, and Item 302, which allowed us to eliminate the Quarterly Financial Data from this filing.

Effective March 31, 2022, we adopted the guidance to comply with the requirements in Item 303.

Management’s Discussion and Analysis of Financial Condition and Results of Operations.

In August 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No.

2020-06, “Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40):

Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity.” This ASU (i) simplifies an issuer’s accounting for convertible instruments by eliminating two of the three models in ASC 470-20 that require separate accounting for embedded conversion features, (ii) amends diluted earnings per share calculations for convertible instruments by requiring the use of the if-converted method and (iii) simplifies the settlement assessment entities are required to perform on contracts that can potentially settle in an entity’s own equity by removing certain requirements.

This guidance is effective for interim and annual periods beginning after December 15, 2021, with early adoption permitted.

We are currently evaluating the effect that this guidance will have on our financial position, results of operations and cash flows.

In March 2020, the SEC issued “Financial Disclosures About Guarantors and Issuers of Guaranteed Securities and Affiliates Whose Securities Collateralize a Registrant’s Securities”, which amends the disclosure requirements for guarantors and issuers of guaranteed securities registered or being registered in Rule 3-10 of Regulation S-X.

The amendment simplifies the disclosure requirements and permits the amended disclosures to be provided outside the footnotes in audited annual or

Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity.” This ASU (i) simplifies an issuer’s accounting for convertible instruments by eliminating two of the three models in Accounting Standards Codification (“ASC”) 470-20 that require separate accounting for embedded conversion features, (ii) amends diluted earnings per share calculations for convertible instruments by requiring the use of the if-converted method and (iii) simplifies the settlement assessment entities are required to perform on contracts that can potentially settle in an entity’s own equity by removing certain requirements.

We adopted this guidance on April 1, 2022 using the modified retrospective method.

Under our Class D Preferred Unit (as defined in Note 9) agreement, we are permitted to issue common units to redeem a portion of the outstanding Class D Preferred Units.

Using the if-converted method, we expect our calculation of earnings per unit to be impacted by both an increase in the number of diluted weighted average common units outstanding and a decrease in the amount of Class D Preferred Unit distributions, when they are determined to be dilutive.

Other than the potential impact to our future earnings per unit calculations, the adoption of this guidance did not impact our financial position, results of operations or cash flows related to any debt or preferred units issued prior to adoption.

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

unaudited interim consolidated financial statements in all filings.

The guidance is effective for the Partnership for fiscal periods ending after January 4, 2021, although early adoption is permitted.

We adopted this guidance effective April 1, 2020 and elected to include the required summarized financial information in “Item 7.

Management’s Discussion and Analysis of Financial Condition and Results of Operations –Liquidity, Sources of Capital and Capital Resource Activities– Guarantor Summarized Financial Information .”

In March 2020, the FASB issued ASU 2020-04, “Reference Rate Reform (Topic 848):

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This guidance is effective prospectively upon issuance through December 31, 2022 and may be applied from the beginning of an interim period that includes the issuance date of this ASU.

We are currently evaluating the effect that this guidance will have on our financial position, results of operations and cash flows.

In June 2016, the FASB issued ASU No.

2016-13, “Financial Instruments-Credit Losses.” The ASU requires a financial asset (or a group of financial assets) measured at amortized cost to be presented at the net amount expected to be collected, which would include trade accounts receivable.

The measurement of expected credit losses is based on relevant information about past events, including historical experience, current conditions, and reasonable and supportable forecasts that affect the collectibility of the reported amount.

We adopted ASU No.

2016-13 on April 1, 2020, using the modified retrospective approach with a cumulative effect adjustment of $ 1.1 million to opening equity at the beginning of the period of adoption.

See Note 17 for a further discussion of the impact of the adoption of this ASU on our consolidated financial statements.

Note 3— (Loss) Income Per Common Unit

On April 13, 2022, the ABL Facility (as defined herein) was amended to replace the LIBOR benchmark with the SOFR (as defined herein) benchmark (as discussed further in Note 7).

We are continuing to evaluate the effect that this guidance will have on our financial position, results of operations and cash flows.

Note 3— Loss Per Common Unit

The following table presents our calculation of basic and diluted weighted average common units outstanding for the periods indicated:

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For the years ended March 31, 2022, 2021 and 2020, all potential common units or convertible securities were considered antidilutive.

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

Our (loss) income per common unit is as follows for the periods indicated:

Our loss per common unit is as follows for the periods indicated:

Year Ended March 31,

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Net loss from continuing operations allocated to common unitholders $ ( 288,630 ) $ ( 730,683 ) $ ( 367,246 )

(Loss) income from discontinued operations, net of tax $ ( 1,769 ) $ ( 218,235 ) $ 418,850

Discontinued operations loss attributable to redeemable noncontrolling interests — — 446

Discontinued operations net loss (income) allocated to general partner (3) 2 218 ( 419 )

Net (loss) income from discontinued operations allocated to common unitholders $ ( 1,767 ) $ ( 218,017 ) $ 418,877

Net (loss) income allocated to common unitholders $ ( 732,450 ) $ ( 585,263 ) $ 247,724

Basic (loss) income per common unit

Loss from discontinued operations, net of tax $ — $ ( 1,769 ) $ ( 218,235 )

Discontinued operations net loss allocated to general partner (3) — 2 218

Net loss from discontinued operations allocated to common unitholders $ — $ ( 1,767 ) $ ( 218,017 )

Net loss allocated to common unitholders $ ( 288,630 ) $ ( 732,450 ) $ ( 585,263 )

Basic loss per common unit

Loss from continuing operations $ ( 2.22 ) $ ( 5.67 ) $ ( 2.88 )

(Loss) income from discontinued operations, net of tax $ ( 0.01 ) $ ( 1.71 ) $ 3.41

Net (loss) income $ ( 5.68 ) $ ( 4.59 ) $ 2.01

Diluted (loss) income per common unit

Loss from discontinued operations, net of tax $ — $ ( 0.01 ) $ ( 1.71 )

Net loss $ ( 2.22 ) $ ( 5.68 ) $ ( 4.59 )

Diluted loss per common unit

Loss from continuing operations $ ( 2.22 ) $ ( 5.67 ) $ ( 2.88 )

(Loss) income from discontinued operations, net of tax $ ( 0.01 ) $ ( 1.71 ) $ 3.41

Net (loss) income $ ( 5.68 ) $ ( 4.59 ) $ 2.01

Loss from discontinued operations, net of tax $ — $ ( 0.01 ) $ ( 1.71 )

Net loss $ ( 2.22 ) $ ( 5.68 ) $ ( 4.59 )

Basic weighted average common units outstanding 129,840,234 128,980,823 127,411,908

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The final accretion for the beneficial conversion of the 10.75 % Class A Preferred Units (as defined herein) and the excess of the 10.75 % Class A Preferred Units repurchase price over the carrying value of the units, as discussed further in Note 9, are included in the year ended March 31, 2020.

(2) Includes cumulative dividends for the quarter ended March 31, 2021 which were earning but not declared or paid (see Note 10).

(3) Net loss (income) allocated to the general partner includes distributions to which it is entitled as the holder of incentive distribution rights.

Note 4— Acquisitions

The following summarizes our acquisitions of assets during the year ended March 31, 2021:

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.

Clair County, 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.

Total consideration for this acquisition was $ 18.2 million, which we are accounting for as an acquisition of assets.

The consideration paid for this transaction was allocated primarily to property, plant and equipment.

This acquisition is included in our Liquids Logistics segment.

The following summarizes the status of the preliminary purchase price allocation of acquisitions completed prior to April 1, 2020:

(2) Includes cumulative distributions for the year ended March 31, 2022 and for the quarter ended March 31, 2021 which were earned but not declared or paid (see Note 9 for a further discussion of the suspension of common unit and preferred unit distributions).

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

Hillstone Environmental Partners, LLC (“Hillstone”) Acquisition

As of October 31, 2020, we completed the acquisition accounting for the Hillstone acquisition.

During the seven months ended October 31, 2020, we received additional information and recorded a decrease of $ 0.7 million to current assets, a decrease of $ 5.1 million to current liabilities and a decrease of $ 6.0 million to the deferred tax liability with the offset to goodwill.

Also, there was a $ 0.9 million decrease to the preliminary purchase price as a result of a true up to the working capital acquired.

This amount was recorded as an offset to goodwill.

There were no other adjustments to the fair value of assets acquired and liabilities assumed during the seven months ended October 31, 2020.

(3) Net loss allocated to the general partner includes distributions to which it is entitled as the holder of incentive distribution rights.

Note 4— Property, Plant and Equipment

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Land 100,038 100,352

Tank bottoms and line fill (1) 20,237 20,346

Tank bottoms and linefill (1) 30,443 20,237

Other 3 - 20 15,252 15,054

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We recover tank bottoms when the storage tanks are removed from service.

Line fill, which represents our portion of the product volume required for the operation of the proportionate share of a pipeline we own, is recorded at historical cost.

Linefill, which represents our portion of the product volume required for the operation of the proportionate share of a pipeline we own, is recorded at historical cost.

The following table summarizes depreciation expense and capitalized interest expense for the periods indicated:

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Capitalized interest expense $ 916 $ 2,778 $ 650

Amounts in the table above do not include depreciation expense and capitalized interest related to TransMontaigne Product Services, LLC (“TPSL”) and our former Retail Propane segment, as these amounts have been classified as discontinued operations within our consolidated statements of operations for all periods presented (see Note 19).

Amounts in the table above do not include depreciation expense and capitalized interest related to TransMontaigne Product Services, LLC (“TPSL”), as these amounts have been classified as discontinued operations within our consolidated statement of operations for the year ended March 31, 2020 (see Note 18).

We record (gains) losses from the sales of property, plant and equipment and any write-downs in value due to impairment within loss on disposal or impairment of assets, net in our consolidated statement of operations.

The following table summarizes (gains) losses on the disposal or impairment of property, plant and equipment by segment for the periods indicated:

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

Year Ended March 31,

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Liquids Logistics 11,750 3,350 ( 30 )

Corporate 228 — —

Corporate and Other — 228 —

Total $ 36,624 $ 41,836 $ 22,497

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

During the year ended March 31, 2022, the following transactions were recorded:

• A net loss of $ 22.3 million related to write-down or write off of certain assets, including facilities damaged by lightning strikes and abandoned projects, and the sale of certain other miscellaneous assets in our Water Solutions segment.

• A loss of $ 11.8 million on the sale of a natural gas liquids terminals in our Liquids Logistics segment.

• An impairment charge of $ 5.8 million to write down the value of an inactive saltwater disposal facility that we do not expect to bring back online as a result of suspended operations from increased seismic activity in our Water Solutions segment.

• A loss of $ 2.2 million from the retirement of certain crude oil terminal assets damaged as part of Hurricane Ida in our Crude Oil Logistics segment.

• A gain of $ 5.5 million on the sale of our trucking assets in our Crude Oil Logistics segment.

During the year ended March 31, 2021, the following transactions were recorded within our Water Solutions segment:

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Note 5— Goodwill

The following table summarizes changes in goodwill by segment for the periods indicated (in thousands):

The following table summarizes changes in goodwill by segment for the period indicated:

Solutions Crude Oil

Logistics Liquids Logistics Total

Logistics Liquids

Logistics Total

(in thousands)

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Revisions to acquisition accounting ( 11,348 ) — — ( 11,348 )

Acquisitions 129,764 — 715 130,479

Impairment — ( 237,800 ) — ( 237,800 )

Balances at March 31, 2021 $ 283,310 $ 342,046 $ 119,083 $ 744,439

Revisions to acquisition accounting (Note 4) ( 11,348 ) — — ( 11,348 )

Impairment — ( 237,800 ) — ( 237,800 )

Balances at March 31, 2022 $ 283,310 $ 342,046 $ 119,083 $ 744,439

1 unchanged sentence

We performed a qualitative assessment as of January 1, 2022 to determine whether it was more likely than not that the fair value of each reporting unit was greater than the carrying value of the reporting unit.

Based on these qualitative assessments, we determined that the fair value of each of our reporting units was more likely than not greater than the carrying value of the reporting units as of January 1, 2021, with the exception of our Water Solutions reporting unit, and our Crude Oil Logistics reporting unit, which was tested for impairment as of December 31, 2020.

Based on these qualitative assessments, we determined that the fair value of each of our reporting units was more likely than not greater than the carrying value of the reporting units as of January 1, 2022, with the exception of our Crude Oil Logistics reporting unit.

See below for a further discussion of the testing.

Due to lower than expected operating results, it was decided that the goodwill within the Crude Oil Logistics reporting unit should be tested for impairment as of January 1, 2022.

We estimated the fair value of the Crude Oil Logistics reporting unit

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

decided that the goodwill within the Water Solutions reporting units should be tested for impairment as of January 1, 2021.

based on the income approach, also known as the discounted cash flow method, which utilizes the present value of future expected cash flows to estimate the fair value.

The future cash flows of the Crude Oil Logistics reporting unit were projected based upon estimates as of the test date of future revenues, operating expenses and cash outflows necessary to support these cash flows, including working capital and maintenance capital expenditures.

We also considered expectations regarding:

(i) the crude oil price environment as reflected in crude oil forward prices as of the test date, (ii) volumes based on historical information and estimates of future drilling and completion activity, as well as expectations for future demand recovery and (iii) estimated fixed and variable costs.

The discounted cash flows for the Crude Oil Logistics reporting unit were based on five years of projected cash flows and we applied a discount rate and terminal multiple that we believe would be applied by a theoretical market participant in similar market transactions.

Based on this test, we concluded that the fair value of the Crude Oil Logistics reporting unit exceeded its carrying value by approximately 12.0 %.

Fiscal Year 2021 Goodwill Impairment Assessment

We performed a qualitative assessment as of January 1, 2021 to determine whether it was more likely than not that the fair value of each reporting unit was greater than the carrying value of the reporting unit.

See below for a further discussion of the testing.

Due to lower than expected disposal volumes as a result of a slower than expected recovery in oil production in the various basins in which our Water Solutions reporting unit operates and the completion of our annual budget process, it was decided that the goodwill within the Water Solutions reporting unit should be tested for impairment as of January 1, 2021.

We estimated the fair value of our Water Solutions reporting unit based on the income approach, also known as the discounted cash flow method, which utilizes the present value of future expected cash flows to estimate the fair value.

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During the three months ended December 31, 2020, in our Crude Oil Logistics reporting unit, we recorded a goodwill impairment charge of $ 237.8 million within loss on disposal or impairment of assets, net in our consolidated statement of operations.

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

Fiscal Year 2020 Goodwill Impairment Assessment

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Based on these tests, we concluded that the fair values of each of our reporting units exceeded their carrying values with the exception of our Water Solutions reporting unit, whose fair value was less than its carrying value by 7.3 %.

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

During the three months ended March 31, 2020, in our Water Solutions reporting unit, we recorded a goodwill impairment charge of $ 250.0 million within loss on disposal or impairment of assets, net in our consolidated statement of operations.

Fiscal Year 2019 Goodwill Impairment Assessment

Due to the continued decrease in demand for natural gas liquid storage and the resulting decline in revenues and earnings as compared to actual and projected results, we tested the goodwill within our natural gas liquids salt cavern storage reporting unit (“Sawtooth reporting unit”), which is part of our Liquids Logistics segment, for impairment at January 1, 2019.

We estimated the fair value of our Sawtooth reporting unit based on the income approach, also known as the discounted cash flow method, which utilizes the present value of future expected cash flows to estimate the fair value.

The future cash flows of our Sawtooth reporting unit were projected based upon estimates as of the test date of future revenues, operating expenses and cash outflows necessary to support these cash flows, including working capital and maintenance capital expenditures.

We also considered expectations regarding:

(i) expected storage volumes, which are assumed to increase in the coming years due to increased production of natural gas liquids, (ii) expected propane and butane prices, (iii) expected rental fees and (iv) the addition of storing refined products (which we acquired as part of the sale of a portion of the reporting unit (see Note 18).

We assumed that commodity prices would be flat through the duration of the model and an average increase of approximately 7 % increase in rental fees per year starting in April 2020, and held such prices and fees flat for periods in our model beyond our 2024 fiscal year.

For expenses, we assumed an increase consistent with the increase in storage volumes, and maintenance capital was held flat throughout the model.

The discount rate used in our discounted cash flow method was a risk adjusted weighted average cost of capital calculated as of January 1, 2019 of approximately 13.1 %.

The discounted cash flow results indicated that the estimated fair value of our Sawtooth reporting unit was less than its carrying value by approximately 35.2 % at January 1, 2019.

During the three months ended March 31, 2019, we recorded a goodwill impairment charge of $ 66.2 million, which was a write-off of the remaining goodwill within the Sawtooth reporting unit.

The goodwill impairment charge was recorded within loss on disposal or impairment of assets, net in our consolidated statement of operations.

We performed a qualitative assessment as of January 1, 2019 to determine whether it was more likely than not that the fair value of each reporting unit was greater than the carrying value of the reporting unit.

Based on these qualitative assessments, we determined that the fair value of each of these reporting units was more likely than not greater than the carrying value of the reporting units, other than the Sawtooth reporting unit as previously described.

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

Note 6— Intangible Assets

Our intangible assets consist of the following at the dates indicated:

March 31, 2021 March 31, 2020

Description Amortizable Lives Gross Carrying

Average March 31, 2022 March 31, 2021

Description Remaining Useful Life Gross Carrying

Amount Accumulated

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Total $ 1,642,639 $ ( 507,285 ) $ 1,135,354 $ 1,780,131 $ ( 517,518 ) $ 1,262,613

(1) Includes debt issuance costs related to the ABL Facility (as defined herein), Revolving Credit Facility (as defined herein) and the Sawtooth credit agreement.

Debt issuance costs related to fixed-rate notes, Bridge Term Credit Agreement (as defined herein) and Term Credit Agreement (as defined herein) are reported as a reduction of the carrying amount of long-term debt.

The weighted-average remaining amortization period for intangible assets is approximately 20.7 years.

(1) Includes debt issuance costs related to the ABL Facility (as defined herein) and the Sawtooth credit agreement.

Debt issuance costs related to fixed-rate notes are reported as a reduction of the carrying amount of long-term debt.

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

Write off of Intangible Assets

For intangible assets other than debt issuance costs, we record (gains) losses from the sales of intangible assets and any write-downs in value due to impairment within loss on disposal or impairment of assets, net in our consolidated statement of operations.

We record the write-off of debt issuance costs within gain (loss) on early extinguishment of liabilities, net in our consolidated statement of operations.

During the year ended March 31, 2022, we recorded the following:

• A gain of $ 1.6 million related to the sale of certain intangible assets in our Water Solutions segment.

• A loss of $ 0.1 million from the write-off of debt issuance costs related to the Sawtooth credit agreement which was paid off and terminated prior to us selling our ownership interest in Sawtooth (see Note 17).

During the year ended March 31, 2021, we recorded the following:

• An impairment charge of $ 145.8 million against the customer commitment intangible asset related to a transportation contract with Extraction that was rejected as part of Extraction’s bankruptcy.

1 unchanged sentence

• An impairment charge of $ 39.2 million to write down the value of a customer relationship intangible asset as part of the write down in value of a larger asset group (see Note 4).

• A $ 4.5 million write off of the debt issuance costs related to the Revolving Credit Facility which was repaid and terminated on February 4, 2021 (see Note 8).

• A $ 4.5 million write off of the debt issuance costs related to a former revolving credit facility which was repaid and terminated on February 4, 2021 (see Note 7).

• An impairment charge of $ 2.5 million to write down the value of the trade name as part of the write down of a larger asset group (see Note 4).

8 unchanged sentences

Total $ 90,244 $ 133,149 $ 138,618

Amounts in the table above do not include amortization expense related to TPSL and our former Retail Propane segment, as these amounts have been classified as discontinued operations within our consolidated statements of operations for all periods presented (see Note 19).

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

Expected amortization of our intangible assets is as follows (in thousands):

Amounts in the table above do not include amortization expense related to TPSL, as these amounts have been classified as discontinued operations within our consolidated statement of operations for the year ended March 31, 2020 (see Note 18).

The following table summarizes expected amortization of our intangible assets at March 31, 2022 (in thousands):

Year Ending March 31,

2 unchanged sentences

Total $ 1,135,099

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

Note 7— Long-Term Debt

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$ 2,050,000 $ ( 35,140 ) $ 2,014,860 $ 2,050,000 $ ( 44,246 ) $ 2,005,754

Asset-based revolving credit facility 4,000 — 4,000 — — —

Asset-based revolving credit facility (“ABL Facility”) 116,000 — 116,000 4,000 — 4,000

Senior unsecured notes:

5 unchanged sentences

332,402 ( 3,460 ) 328,942 338,402 ( 4,378 ) 334,024

Revolving credit facility:

Expansion capital borrowings — — — 1,120,000 — 1,120,000

Working capital borrowings — — — 350,000 — 350,000

Bridge term credit agreement — — — 250,000 ( 3,198 ) 246,802

Other long-term debt 41,705 ( 59 ) 41,646 49,095 ( 70 ) 49,025

2 unchanged sentences

Long-term debt $ 3,393,451 $ ( 42,988 ) $ 3,350,463 $ 3,374,585 $ ( 55,555 ) $ 3,319,030

(1) Debt issuance costs related to the ABL Facility, the Sawtooth credit agreement (included in other long-term debt) and the Revolving Credit Facility are reported within intangible assets, rather than as a reduction of the carrying amount of long-term debt.

Recent Developments

On February 4, 2021, we closed on our private offering of $ 2.05 billion of 7.5 % 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”).

Total offering costs and expenses were approximately $ 150.7 million, which includes certain make-whole (see Term Credit Agreement below) and consent costs (see Note 13).

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.

(1) Debt issuance costs related to the ABL Facility and the Sawtooth credit agreement (included in other long-term debt) are reported within intangible assets, rather than as a reduction of the carrying amount of long-term debt.

2026 Senior Secured Notes

The 2026 Senior Secured Notes bear interest at 7.5 %, which is payable on February 1 and August 1 of each year, beginning on August 1, 2021.

On February 4, 2021, we closed on our private offering of $ 2.05 billion of 7.5 % 2026 Senior Secured Notes.

Interest is payable on February 1 and August 1 of each year, beginning on August 1, 2021.

The 2026 Senior Secured Notes mature on February 1, 2026.

The 2026 Senior Secured Notes were issued pursuant to an indenture dated February 4, 2021 (the “Indenture”).

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

The 2026 Senior Secured Notes are secured by first priority liens in substantially all of our assets other than our accounts receivable, inventory, pledged deposit accounts, cash and cash equivalents, renewable energy tax credits and related assets and second priority liens in our accounts receivable, inventory, pledged deposit accounts, cash and cash equivalents, renewable energy tax credits and related assets.

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If we experience certain kinds of change of control triggering events, we will be required to offer to repurchase the 2026 Senior Secured Notes at 101% of the aggregate principal amount of the 2026 Senior Secured Notes repurchased plus accrued and unpaid interest on the 2026 Senior Secured Notes repurchased to, but not including, the date of purchase.

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

At March 31, 2022, we were in compliance with the covenants under the 2026 Senior Secured Notes indenture.

The $ 500.0 million ABL Facility is subject to a borrowing base, which includes a sub-limit for letters of credit.

The initial borrowing base is $ 500.0 million and the sub-limit for letters of credit is $ 200.0 million.

On February 4, 2021, we closed on our ABL Facility that is subject to a borrowing base, which includes a sub-limit for letters of credit.

The initial commitments totaled $ 500.0 million and the sub-limit for letters of credit was $ 200.0 million.

The ABL Facility is secured by a lien on substantially all of our assets, including among other things, a first priority lien on our accounts receivable, inventory, pledged deposit accounts, cash and cash equivalents, renewable energy tax credits and related assets and a second priority lien on all of our other assets.

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The ABL Facility is scheduled to mature at the earliest of (a) February 4, 2026 or (b) 91 days prior to the earliest maturity date in respect to any of our indebtedness in an aggregate principal amount of $50.0 million or greater, if such indebtedness is outstanding at such time, subject to certain exceptions.

The ABL Facility bears interest at a LIBOR-based rate (with such customary provisions under the ABL Facility providing for the replacement of LIBOR with any successor rate) or an alternate base rate, in each case plus an applicable borrowing margin based on our Fixed Charge Coverage Ratio (as defined in the New Credit Agreement).

The applicable margin for alternate base rate loans varies from 1.50% to 2.00% and the applicable margin for LIBOR-based loans varies from 2.50% to 3.00%.

All borrowings under the ABL Facility bear interest at our option, at either (i) a LIBOR-based rate (with such customary provisions under the ABL Facility providing for the replacement of LIBOR with any successor rate such rate having been determined to be a SOFR-base rate (as defined herein) or (ii) an alternate base rate, in each case plus an applicable borrowing margin based on our fixed charge coverage ratio (as defined in the ABL Facility).

The applicable margin for alternate base rate loans varies from 1.50% to 2.00% and the applicable margin for LIBOR/SOFR-based loans varies from 2.50% to 3.00%.

In addition, a commitment fee will be charged and payable quarterly in arrears based on the average daily unused portion of the revolving commitments under the ABL Facility.

Such commitment fee will be 0.50% per year, subject to a reduction to 0.375% in the event our fixed charge coverage ratio is greater than or equal to 1.75 to 1.00.

At March 31, 2021, the borrowings under the ABL Facility had a weighted average interest rate of 5.25 % calculated as the prime rate of 3.25 % plus a margin of 2.00 % on the alternate base rate borrowings.

At March 31, 2022, the borrowings under the ABL Facility had a weighted average interest rate of 4.64 % calculated as the prime rate of 3.50 % plus a margin of 2.00 % on the alternate base rate borrowings and weighted average LIBOR of 0.50 % plus a margin of 3.00 % for the LIBOR borrowings.

On March 31, 2022, the interest rate in effect on letters of credit was 3.00 %.

The New Credit Agreement contains various affirmative and negative covenants, including financial reporting requirements and limitations on indebtedness, liens, mergers, consolidations, liquidations and dissolutions, sales of assets, distributions and other restricted payments, investments (including acquisitions) and transactions with affiliates.

The New Credit Agreement contains, as the only financial covenant, a minimum Fixed Charge Coverage Ratio financial covenant that is

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

tested based on the financial statements for the most recently ended fiscal quarter upon the occurrence and during the continuation of a Cash Dominion Event (as defined in the New Credit Agreement).

At March 31, 2021, no Cash Dominion Event had occurred or was continuing.

The ABL Facility contains various affirmative and negative covenants, including financial reporting requirements and limitations on indebtedness, liens, mergers, consolidations, liquidations and dissolutions, sales of assets, distributions and other restricted payments, investments (including acquisitions) and transactions with affiliates.

The ABL Facility contains, as the only financial covenant, a fixed charge coverage ratio financial covenant that is tested based on the financial statements for the most recently ended fiscal quarter upon the occurrence and during the continuation of a Cash Dominion Event (as defined in the ABL Facility).

At March 31, 2022, no Cash Dominion Event had occurred.

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.

In addition, the sub-limit for letters of credit was increased to $ 250.0 million and the LIBOR benchmark was replaced with an adjusted forward-looking term rate based on the secured overnight financing rate (“SOFR”) as the interest rate benchmark.

At March 31, 2022, we were in compliance with the covenants under the ABL Facility.

Senior Unsecured Notes

The senior unsecured notes include, as defined below, the 2019 Notes, 2021 Notes, 2023 Notes, 2025 Notes and 2026 Notes (collectively, the “Senior Unsecured Notes”).

The senior unsecured notes include the 2023 Notes, 2025 Notes and 2026 Notes (collectively, the “Senior Unsecured Notes”).

The Partnership and NGL Energy Finance Corp.

are co-issuers of the Senior Unsecured Notes, and the obligations under the Senior Unsecured Notes are fully and unconditionally guaranteed by certain of our existing and future restricted subsidiaries that incur or guarantee indebtedness under certain of our other indebtedness, including the ABL Facility.

The indentures governing the Senior Unsecured Notes contain various customary covenants, including, (i) pay distributions on, purchase or redeem our common equity or purchase or redeem our subordinated debt, (ii) incur or guarantee additional indebtedness or issue preferred units, (iii) create or incur certain liens, (iv) enter into agreements that restrict distributions or other payments from our restricted subsidiaries to us, (v) consolidate, merge or transfer all or substantially all of our assets, and (vi) engage in transactions with affiliates.

The indentures governing the Senior Unsecured Notes contain various customary covenants, including certain covenants that govern our ability to (i) pay distributions on, purchase or redeem our common equity or purchase or redeem our subordinated debt, (ii) incur or guarantee additional indebtedness or issue preferred units, (iii) create or incur certain liens, (iv) enter into agreements that restrict distributions or other payments from our restricted subsidiaries to us, (v) consolidate, merge or transfer all or substantially all of our assets, and (vi) engage in transactions with affiliates.

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

Our obligations under the Senior Unsecured Notes may be accelerated following certain events of default (subject to applicable cure periods), including, without limitation, (i) the failure to pay principal or interest when due, (ii) experiencing an event of default on certain other debt agreements, or (iii) certain events of bankruptcy or insolvency.

On July 9, 2014, we issued $ 400.0 million of 5.125 % Senior Unsecured Notes Due 2019 (“2019 Notes”).

The 2019 Notes were redeemed on March 15, 2019.

See further discussion below.

On October 16, 2013, we issued $ 450.0 million of 6.875 % Senior Unsecured Notes Due 2021 (“2021 Notes”).

The 2021 Notes were redeemed on October 16, 2018.

See further discussion below.

On October 24, 2016, we issued $ 700.0 million of 7.5 % 2023 Notes.

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The 2026 Notes mature on April 15, 2026.

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

The following table summarizes redemptions of Senior Unsecured Notes for the period indicated:

March 31, 2019

(in thousands)

2019 Notes (1)

Notes redeemed $ 328,005

Cash paid (excluding payments of accrued interest) $ 329,719

Loss on early extinguishment of debt $ ( 2,113 )

2021 Notes (2)

Notes redeemed $ 367,048

Cash paid (excluding payments of accrued interest) $ 373,358

Loss on early extinguishment of debt $ ( 10,130 )

(1) On March 15, 2019, we redeemed all of the remaining outstanding 2019 Notes.

Loss on the early extinguishment of debt for the 2019 Notes during the year ended March 31, 2019 is inclusive of the write off of debt issuance costs of $ 0.4 million.

The loss is reported within (loss) gain on early extinguishment of liabilities, net within our consolidated statement of operations.

(2) On October 16, 2018, we redeemed all of the remaining outstanding 2021 Notes.

Loss on the early extinguishment of debt for the 2021 Notes during the year ended March 31, 2019 is inclusive of the write off of debt issuance costs of $ 3.8 million.

The loss is reported within (loss) gain on early extinguishment of liabilities, net within our consolidated statement of operations.

The following table summarizes repurchases of Senior Unsecured Notes for the periods indicated:

4 unchanged sentences

Cash paid (excluding payments of accrued interest) $ 77,847 $ 33,566 $ —

Loss on early extinguishment of debt (1) $ — $ — $ ( 34 )

Notes repurchased $ 52,072 $ — $ 8,624

Cash paid (excluding payments of accrued interest) $ 33,566 $ — $ 8,575

Gain (loss) on early extinguishment of debt (2) $ 18,096 $ — $ ( 63 )

Gain on early extinguishment of debt (1) $ 1,318 $ 18,096 $ —

Notes repurchased $ — $ 7,300 $ 1,815

4 unchanged sentences

Gain on early extinguishment of debt (3) $ 610 $ 31,463 $ —

(1) Loss on early extinguishment of debt for the 2019 Notes during the year ended March 31, 2019 is inclusive of the write off of debt issuance costs of less than $ 0.1 million.

The loss is reported within (loss) gain on early extinguishment of liabilities, net within our consolidated statement of operations.

(2) Gain (loss) on early extinguishment of debt for the 2023 Notes during the years ended March 31, 2021 and 2019 is inclusive of the write off of debt issuance costs of $ 0.4 million and $ 0.1 million, respectively.

The gain (loss) is reported within (loss) gain on early extinguishment of liabilities, net within our consolidated statements of operations.

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

(1) Gain on early extinguishment of debt for the 2023 Notes during the years ended March 31, 2022 and 2021 is inclusive of the write off of debt issuance costs of $ 0.4 million and $ 0.4 million, respectively.

The gain is reported within gain (loss) on early extinguishment of liabilities, net within our consolidated statements of operations.

(2) Gain on early extinguishment of debt for the 2025 Notes during the years ended March 31, 2021 and 2020 is inclusive of the write off of debt issuance costs of $ 0.1 million and less than $ 0.1 million, respectively.

The gain is reported within (loss) gain on early extinguishment of liabilities, net within our consolidated statements of operations.

(4) Gain on early extinguishment of debt for the 2026 Notes during the year ended March 31, 2021 is inclusive of the write off of debt issuance costs of $ 1.6 million.

The gain is reported within (loss) gain on early extinguishment of liabilities, net within our consolidated statement of operations.

The gain is reported within gain (loss) on early extinguishment of liabilities, net within our consolidated statements of operations.

(3) Gain on early extinguishment of debt for the 2026 Notes during the years ended March 31, 2022 and 2021 is inclusive of the write off of debt issuance costs of $ 0.1 million and $ 1.6 million, respectively.

The gain is reported within gain (loss) on early extinguishment of liabilities, net within our consolidated statement of operations.

At March 31, 2022, we were in compliance with the covenants under all of the Senior Unsecured Notes indentures.

Credit Agreement

We were party to a credit agreement (“Credit Agreement”) with a syndicate of banks.

The Credit Agreement provided up to $ 1.915 billion in aggregate commitments and consisted of a revolving credit facility to fund working capital needs, which had a capacity of $ 350.0 million for cash borrowings and letters of credit (the “Working Capital Facility”), and a revolving credit facility to fund acquisitions and expansion projects, which had a capacity of $ 1.565 billion (the “Expansion Capital Facility,” and together with the Working Capital Facility, the “Revolving Credit Facility”).

On February 4, 2021, we repaid all of the outstanding borrowings under and terminated the Credit Agreement which included $ 0.3 million of termination expenses as well as the write off of debt issuance cost which were recorded within intangible assets (see Note 7).

Term Credit Agreement

On June 3, 2020, we entered into a new $ 250.0 million term credit agreement (the “Term Credit Agreement”) with certain funds and accounts managed by affiliates of Apollo Global Management, Inc.

to refinance the previous Bridge Term Credit Agreement (as defined herein).

The commitments under the Term Credit Agreement were set to expire on June 3, 2023 and were callable by us after two years at par.

On February 4, 2021, we repaid all of the outstanding borrowings under and terminated the Term Credit Agreement.

This termination required us to pay a make-whole fee of $ 55.6 million, write off debt issuance costs of $ 7.4 million, and pay additional termination expenses of $ 0.1 million.

Bridge Term Credit Agreement

On July 2, 2019 (the “Closing Date”), we entered into a bridge term credit agreement (the “Bridge Term Credit Agreement”) with Toronto Dominion (Texas) LLC for a $ 250.0 million term loan facility.

Toronto Dominion (Texas) LLC and certain of its affiliates are also lenders under our Credit Agreement.

Proceeds from the term loan facility were used to fund a portion of the purchase price for the Mesquite acquisition.

The commitments under the Term Credit Agreement were set to expire on July 2, 2024.

On June 3, 2020, we used the proceeds from the Term Credit Agreement to pay off the outstanding balance of the Bridge Term Credit Agreement.

We wrote off $ 2.3 million of debt issuance costs which is reported within (loss) gain on early extinguishment of liabilities, net within our consolidated statement of operations.

Sawtooth Credit Agreement

On November 27, 2019, Sawtooth, a joint venture in which we own approximately a 71.5 % interest, entered into a credit agreement with Zions Bancorporation (doing business as “Amegy Bank”).

The Sawtooth credit agreement has a capacity of $ 20.0 million.

The commitments under the Sawtooth credit agreement expire on November 27, 2022.

At March 31, 2021, $ 5.0 million had been borrowed under the Sawtooth credit agreement.

The borrowings under this facility had an average interest rate of 2.36 %.

Commitment fees are charged at a rate of 0.50 % on any unused capacity.

At March 31, 2021, we were in compliance with the covenants under the Sawtooth credit agreement.

Other Long-Term Debt

The Sawtooth credit agreement was paid off and terminated prior to us selling our ownership interest in Sawtooth on June 18, 2021 (see Note 17).

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

Equipment Loan

On October 29, 2020, we entered into an equipment loan for $ 45.0 million with Stonebriar Commercial Finance LLC which bears interest at a rate of 8.6 % and is secured by certain of our barges and towboats.

On October 29, 2020, we entered into an equipment loan for $ 45.0 million which bears interest at a rate of 8.6 % and is secured by certain of our barges and towboats.

We have an aggregate principal balance of $ 41.7 million at March 31, 2022.

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Amortization expense for debt issuance costs related to long-term debt was $ 12.2 million, $ 7.8 million and $ 5.4 million during the years ended March 31, 2022, 2021 and 2020, respectively.

Expected amortization of debt issuance costs is as follows (in thousands):

The following table summarizes expected amortization of debt issuance costs at March 31, 2022 (in thousands):

Year Ending March 31,

2023 $ 12,049

Thereafter 53

Total $ 42,988

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Following a jury trial conducted in Delaware state court from July 23, 2018 through August 1, 2018, the jury returned a verdict consisting of an award of $ 4.0 million for quantum meruit and $ 29.0 million for fraudulent misrepresentation, subject to statutory interest.

On December 5, 2019, in response to the defendants’ post-trial motion, the Court issued an Order overturning the jury’s damages award and ordering the case to be set for a damages-only trial.

On December 5, 2019, in response to the defendants’ post-trial motion, the Court issued an Order overturning the jury’s damages award and ordering the case to be set for a damages-only trial (the “December 5th Order”).

Both parties filed applications with the trial court asking the trial court to certify the December 5th Order for interlocutory, immediate review by the Appellate Court.

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(c) the trial court abused its discretion when it ordered a new trial on damages relating to LCT’s claim of fraudulent misrepresentation;

and (d) the trial court properly ordered a new trial on LCT’s claim of quantum meruit

and (d) the trial court properly ordered a new trial on LCT’s claim of quantum meruit damages.

The date for the new trial, to be limited to the quantum meru i t claim, has been set by the trial court for November 7, 2022.

Any allocation of the ultimate verdict award, if any, between the GP and the Partnership will be

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

The date for a new trial, to be limited to the quantum meruit claim, has not yet been set by the trial court.

Any allocation of the ultimate verdict award, if any, between the GP and the Partnership will be made by the board of directors of our general partner once all information is available to it and after the new trial, any post-trial and/or any appellate process has concluded and the verdict is final as a matter of law.

made by the board of directors of our general partner once all information is available to it and after the new trial, any post-trial and/or any appellate process has concluded and the verdict is final as a matter of law.

As of March 31, 2022, we have accrued $ 2.5 million related to this matter.

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However, some risk of environmental or other damage is inherent in our business.

In 2015, as previously disclosed, the United States Environmental Protection Agency (“EPA”) informed NGL Crude Logistics, LLC, formerly known as Gavilon, LLC (“Gavilon Energy”), of alleged violations that occurred in 2011 by Gavilon Energy of the Clean Air Act’s renewable fuel standards regulations (prior to its acquisition by us in December 2013).

On October 4, 2016, the United States Department of Justice, acting at the request of the EPA, filed a civil complaint in the Northern District of Iowa against Gavilon Energy and one of its then suppliers, Western Dubuque Biodiesel LLC (“Western Dubuque”).

Consistent with the earlier allegations by the EPA, the civil complaint related to transactions between Gavilon Energy and Western Dubuque and the generation of biodiesel renewable identification numbers (“RINs”) sold by Western Dubuque to Gavilon Energy in 2011.

On December 19, 2016, we filed a motion to dismiss the complaint.

On January 9, 2017, the EPA filed an amended complaint.

The amended complaint seeks an order declaring Western Dubuque’s RINs invalid and requiring the defendants to retire an equivalent number of valid RINs and that the defendants pay statutory civil penalties.

On January 23, 2017, we filed a motion to dismiss the amended complaint.

On May 24, 2017, the court denied our motion to dismiss.

Subsequently, the EPA filed a second amended complaint seeking an order declaring Western Dubuque’s RINs invalid, an order requiring us to retire an equivalent number of valid RINs and an award against us of statutory civil penalties.

In May 2018, the parties completed briefing on cross-motions for summary judgment concerning liability issues in the case.

On July 3, 2018, the Court denied our summary judgment motion and largely granted the plaintiff’s two summary judgment motions on liability.

On July 19, 2018, Gavilon Energy reached an agreement in principle with the EPA regarding the terms of a settlement of the case, which was memorialized in a consent decree lodged to the Court on September 27, 2018.

Such terms will result in Gavilon Energy paying cash of $ 25.0 million and retiring 36 million RINs, over a twelve-month period.

The consent decree was approved by the Court on November 8, 2018.

The consent decree resolves all matters between Gavilon Energy and the EPA in connection with the above-described complaint.

During the year ended March 31, 2019, we paid the EPA $ 12.5 million and retired all 36 million RINs.

During the year ended March 31, 2020, we paid the final EPA settlement amount of $ 12.5 million.

Asset Retirement Obligations

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The following table summarizes changes in our asset retirement obligation, which is reported within other noncurrent liabilities in our consolidated balance sheets (in thousands):

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

Balance at March 31, 2020 $ 18,416

Liabilities incurred 7,952

Liabilities assumed in acquisitions 6,642

Liabilities settled ( 658 )

Liabilities associated with disposed assets (1) ( 22 )

Accretion expense 1,733

4 unchanged sentences

Balance at March 31, 2022 $ 29,941

(1) This amount relates to the sale of certain permits, land and a saltwater disposal facility (se e Note 18 ).

(1) Relates to the sale of certain permits, land and saltwater disposal facility (see Note 17).

(2) Relates primarily to the disposition of Sawtooth (se e Note 17 ) as well as the sale of certain water disposal wells.

In addition to the obligations described above, we may be obligated to remove facilities or perform other remediation upon retirement of certain other assets.

1 unchanged sentence

We will record an asset retirement obligation for these assets in the periods in which settlement dates are reasonably determinable.

Other Commitments

We have noncancelable agreements for product storage, railcar spurs and real estate.

The following table summarizes future minimum payments under these agreements at March 31, 2021 (in thousands):

Year Ending March 31,

2022 $ 10,074

Thereafter 275

Total $ 19,614

As part of the Hillstone acquisition discussed in Note 4, we assumed an obligation to pay a quarterly subsidy payment in the event that specified volumetric thresholds are not exceeded at a third-party facility.

This agreement expires on December 31, 2022.

During the years ended March 31, 2021 and 2020, we recorded $ 2.6 million and $ 0.8 million, respectively, within operating expense in our consolidated statements of operations.

At March 31, 2021, the range of potential payments we could be obligated to make pursuant to the subsidy agreement could be from $ 0.0 million to $ 5.7 million.

Pipeline Capacity Agreements

We have noncancelable agreements with crude oil pipeline operators, which guarantee us minimum monthly shipping capacity on the pipelines.

We have noncancelable agreements with crude oil pipeline operators, which guarantee us minimum monthly shipping capacity on their pipelines.

As a result, we are required to pay the minimum shipping fees if actual shipments are less than our allotted capacity.

Under certain agreements we have the ability to recover minimum shipping fees previously paid if our shipping volumes exceed the minimum monthly shipping commitment during each month remaining under the agreement, with some contracts containing provisions that allow us to continue shipping up to six months after the maturity date of the contract in order to recapture previously paid minimum shipping delinquency fees.

We currently have an asset recorded in prepaid expenses and other current assets and in other noncurrent assets in our consolidated balance sheet for minimum shipping fees paid in both the current and previous periods that are expected to be recovered in future periods by exceeding the minimum monthly volumes (see Note 2).

We currently have an asset recorded in prepaid

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

expenses and other current assets and in other noncurrent assets in our consolidated balance sheet for minimum shipping fees paid in both the current and previous periods that are expected to be recovered in future periods by exceeding the minimum monthly volumes (see Note 2).

The following table summarizes future minimum throughput payments under these agreements at March 31, 2022 (in thousands):

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We have entered into product sales and purchase contracts for which we expect the parties to physically settle and deliver the inventory in future periods.

At March 31, 2021, we had the following commodity purchase commitments (in thousands):

At March 31, 2022, we had the following commodity purchase commitments:

Crude Oil (1) Natural Gas Liquids

(in barrels) Value Volume

(in thousands)

Fixed-Price Commodity Purchase Commitments:

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2026 687,824 10,410 — —

2026 938,787 20,263 — —

Total $ 8,487,065 105,181 $ 1,448,790 1,025,567

1 unchanged sentence

As these purchase commitments are deliver-or-pay contracts, whereby our counterparty is required to pay us for any volumes not delivered, we have not entered into corresponding long-term sales contracts for volumes we may not receive.

At March 31, 2021, we had the following commodity sale commitments (in thousands):

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

At March 31, 2022, we had the following commodity sale commitments:

Crude Oil Natural Gas Liquids

(in barrels) Value Volume

(in thousands)

Fixed-Price Commodity Sale Commitments:

1 unchanged sentence

2024 — — 7,844 9,692

2025 — — 46 50

Total $ 187,058 1,839 $ 61,685 56,595

4 unchanged sentences

2026 28,698 390 — —

2026 484,326 10,242 — —

Total $ 4,736,758 53,360 $ 721,769 421,635

1 unchanged sentence

Under this accounting policy election, we do not record the physical contracts at fair value at each balance sheet date;

instead, we record

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

the purchase or sale at the contracted value once the delivery occurs.

instead, we record the purchase or sale at the contracted value once the delivery occurs.

Contracts in the tables above may have offsetting derivative contracts (described in Note 10) or inventory positions (described in Note 2).

2 unchanged sentences

These contracts are included in the derivative disclosures in Note 10, and represent $ 52.0 million of our prepaid expenses and other current assets and $ 23.0 million of our accrued expenses and other payables at March 31, 2022.

Other Commitments

We have noncancelable agreements for product storage, railcar spurs and real estate.

The following table summarizes future minimum payments under these agreements at March 31, 2022 (in thousands):

Year Ending March 31,

2023 $ 12,092

Thereafter 5,502

Total $ 31,432

As part of the acquisition of Hillstone Environmental Partners, LLC (“Hillstone”), we assumed an obligation to pay a quarterly subsidy payment in the event that specified volumetric thresholds are not exceeded at a third-party facility.

This agreement expires on December 31, 2022.

During the years ended March 31, 2022, 2021 and 2020, we recorded $ 2.1 million, $ 2.6 million and $ 0.8 million, respectively, within operating expense in our consolidated statements of operations.

At March 31, 2022, the range of potential payments we could be obligated to make pursuant to the subsidy agreement could be from $ 0.0 million to $ 2.4 million.

Note 9— Equity

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The Partnership’s equity consists of a 0.1 % general partner interest and a 99.9 % limited partner interest, which consists of common units.

Our general partner has the right, but not the obligation, to contribute a proportionate amount of capital to us to maintain its 0.1 % general partner interest.

Our general partner has the right, but not the obligation, to contribute a proportionate amount of

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

capital to us to maintain its 0.1 % general partner interest.

Our general partner is not required to guarantee or pay any of our debts or obligations.

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On August 30, 2019, the board of directors of our general partner authorized a common unit repurchase program, under which we may repurchase up to $ 150.0 million of our outstanding common units through September 30, 2021 from time to time in the open market or in other privately negotiated transactions.

We have not repurchased units under this program.

We did not repurchase any units under this plan and this plan has expired.

Suspension of Common Unit and Preferred Unit Distributions

The board of directors of our general partner temporarily suspended all distributions (common unit distributions beginning with the quarter ended December 31, 2020 and preferred unit distributions beginning with the quarter ended March 31, 2021) in order to deleverage our balance sheet and meet the financial performance ratios set within the Indenture of the 2026 Senior Secured Notes, as discussed further in Note 8.

The board of directors of our general partner temporarily suspended all distributions (common unit distributions which began with the quarter ended December 31, 2020 and preferred unit distributions which began with the quarter ended March 31, 2021) in order to deleverage our balance sheet and meet the financial performance ratios set within the Indenture of the 2026 Senior Secured Notes, as discussed further in Note 7.

Our Distributions

The following table summarizes distributions declared on our common units during the last three fiscal years:

The following table summarizes distributions declared on our common units during the years ended March 31, 2021 and 2020:

Date Declared Record Date Payment Date Amount

10 unchanged sentences

October 27, 2020 November 6, 2020 November 13, 2020 $ 0.1000 $ 12,877 $ 13

January 23, 2020 February 7, 2020 February 14, 2020 $ 0.3900 $ 50,056 $ 86

April 27, 2020 May 7, 2020 May 15, 2020 $ 0.2000 $ 25,754 $ 26

July 23, 2020 August 6, 2020 August 14, 2020 $ 0.2000 $ 25,754 $ 26

October 27, 2020 November 6, 2020 November 13, 2020 $ 0.1000 $ 12,877 $ 13

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

Class A Convertible Preferred Units

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To the extent declared, such distributions were paid for each such quarter within 45 days after each quarter end.

The following table summarizes distributions declared on our Class A Preferred Units during the last two fiscal years:

Date Declared Payment Date Amount Paid to Class A

Preferred Unitholders

(in thousands)

April 24, 2018 May 15, 2018 $ 6,449

July 24, 2018 August 14, 2018 $ 6,449

October 23, 2018 November 14, 2018 $ 6,449

January 22, 2019 February 14, 2019 $ 6,449

April 24, 2019 May 10, 2019 $ 4,034

We allocated the net proceeds on a relative fair value basis to the Class A Preferred Units, which includes the value of a beneficial conversion feature, and warrants.

We recorded the accretion attributable to the beneficial conversion feature as a deemed distribution.

Accretion for the beneficial conversion feature was $ 36.5 million and $ 67.2 million for the years ended March 31, 2020 and 2019, respectively.

During the year ended March 31, 2019, 228,797 warrants were exercised for common units and we received proceeds of less than $ 0.1 million, and we repurchased 1,229,575 unvested warrants for a total purchase price of $ 15.0 million on April 26, 2018.

Accretion for the beneficial conversion feature was $ 36.5 million for the year ended March 31, 2020.

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

On April 5, 2019, we redeemed 7,468,978 of the Class A Preferred Units.

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At any time on or after July 1, 2022, we may redeem our Class B Preferred Units, in whole or in part, at a redemption price of $25.00 per Class B Preferred Unit plus an amount equal to all accumulated and unpaid distributions to, but not including, the date of redemption, whether or not declared.

We may also redeem the Class B Preferred Units upon a change of

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

control as defined in our partnership agreement.

We may also redeem the Class B Preferred Units upon a change of control as defined in our partnership agreement.

If we choose not to redeem the Class B Preferred Units, the Class B preferred unitholders may have the ability to convert the Class B Preferred Units to common units at the then applicable conversion rate.

2 unchanged sentences

The initial distribution rate for the Class B Preferred Units from and including the date of original issue to, but not including, July 1, 2022 is 9.00% per year of the $25.00 liquidation preference per unit (equal to $2.25 per unit per year).

The current distribution rate for the Class B Preferred Units is 9.00% per year of the $25.00 liquidation preference per unit (equal to $2.25 per unit per year).

The following table summarizes distributions declared on our Class B Preferred Units during the last three fiscal years:

On and after July 1, 2022, distributions on the Class B Preferred Units will accumulate at a percentage of the $25.00 liquidation preference equal to the applicable three-month LIBOR interest rate (or alternative rate as determined in accordance with the partnership agreement) plus a spread of 7.213%.

The following table summarizes distributions declared on our Class B Preferred Units for the years ended March 31, 2021 and 2020:

Date Declared Record Date Payment Date Amount Per Unit Amount Paid to Class B

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December 16, 2019 December 31, 2019 January 15, 2020 $ 0.5625 $ 7,079

March 15, 2019 April 1, 2019 April 15, 2019 $ 0.5625 $ 4,725

June 14, 2019 July 1, 2019 July 15, 2019 $ 0.5625 $ 4,725

September 16, 2019 October 1, 2019 October 15, 2019 $ 0.5625 $ 7,079

December 16, 2019 December 31, 2019 January 15, 2020 $ 0.5625 $ 7,079

March 16, 2020 March 31, 2020 April 15, 2020 $ 0.5625 $ 7,079

2 unchanged sentences

December 17, 2020 January 1, 2021 January 15, 2021 $ 0.5625 $ 7,079

For the quarter ended March 31, 2021, we did not declare or pay distributions to the holders of the Class B Preferred Units, thus the cumulative distribution for each Class B Preferred Unit is $ 0.5625 .

The current distribution rate for the Class B Preferred Units is 9.00% per year of the $25.00 liquidation preference per unit (equal to $2.25 per unit per year).

For the quarter ended March 31, 2022, we did not declare or pay distributions to the holders of the Class B Preferred Units, thus the quarterly distribution for March 31, 2022 is $ 0.5625 and the cumulative distributions since suspension for each Class B Preferred unit is $ 2.8125 .

In addition, the amount of cumulative but unpaid distribution shall continue to accumulate at the then applicable rate until all unpaid distributions have been paid in full.

The total amount due as of March 31, 2022 is $ 36.9 million.

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

Class C Preferred Units

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Distributions on the Class C Preferred Units are payable on the 15th day of each January, April, July and October of each year to holders of record on the first day of each payment month.

The current distribution rate for the Class C Preferred Units is 9.625% per year of the $25.00 liquidation preference per unit (equal to $2.41 per unit per year).

The following table summarizes distributions declared on our Class C Preferred Units during the last two fiscal years:

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

On and after April 15, 2024, distributions on the Class C Preferred Units will accumulate at a percentage of the $25.00 liquidation preference equal to the applicable three-month LIBOR interest rate (or alternative rate as determined in accordance with the partnership agreement) plus a spread of 7.384%.

The following table summarizes distributions declared on our Class C Preferred Units for the years ended March 31, 2021 and 2020:

Amount Paid to Class C

8 unchanged sentences

December 17, 2020 January 1, 2021 January 15, 2021 $ 0.6016 $ 1,083

For the quarter ended March 31, 2021, we did not declare or pay distributions to the holders of the Class C Preferred Units, thus the cumulative distribution for each Class C Preferred Unit is $ 0.6016 .

The current distribution rate for the Class C Preferred Units is 9.625% per year of the $25.00 liquidation preference per unit (equal to $2.41 per unit per year).

For the quarter ended March 31, 2022, we did not declare or pay distributions to the holders of the Class C Preferred Units, thus the quarterly distribution for each Class C Preferred Unit is $ 0.6016 and the cumulative distribution since suspension for each Class C Preferred Unit is $ 3.0078 .

In addition, the amount of cumulative but unpaid distributions shall continue to accumulate at the then applicable rate until all unpaid distributions have been paid in full.

The total amount due as of March 31, 2022 is $ 5.7 million.

Class D Preferred Units

6 unchanged sentences

We allocated the net proceeds, on a relative fair value basis, to the Class D Preferred Units ($ 183.6 million) and warrants ($ 11.1 million).

Proceeds from this issuance of Class D Preferred Units were used to fund a portion of the purchase price for the Hillstone acquisition (see Note 4).

The holders of the Class D Preferred Units are entitled to receive a cumulative, quarterly distribution in arrears on each Class D Preferred Unit then held at an annual rate of (i) 9.00% per annum for all periods during which the Class D Preferred Units are outstanding beginning on the Closing Date and ending on the date and including the last day of the eleventh full quarter following the Closing Date, (ii) 10.00% per annum for all periods during which the Class D Preferred Units are outstanding beginning on and including the first day of the twelfth full quarter following the Closing Date and ending on the last day of the nineteenth full quarter following the Closing Date, and (iii) thereafter, 10.00% per annum or, at the purchasers’ election from time to time, a floating rate equal to the applicable three-month LIBOR, plus 7.00% per annum.

The current distribution rate for the Class D Preferred Units is 9.00% per year per unit (equal to $90.00 per unit per year).

The following table summarizes cash distributions declared on our Class D Preferred Units during the last two fiscal years:

Proceeds from this issuance of Class D Preferred Units were used to fund a portion of the purchase price for the Hillstone acquisition.

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

The holders of the Class D Preferred Units are entitled to receive a cumulative, quarterly distribution in arrears on each Class D Preferred Unit then held at an annual rate of (i) 9.00% per annum for all periods during which the Class D Preferred Units are outstanding beginning on July 2, 2019 (the “Closing Date”) and ending on the date and including the last day of the eleventh full quarter following Closing Date, (ii) 10.00% per annum for all periods during which the Class D Preferred Units are outstanding beginning on and including the first day of the twelfth full quarter following the Closing Date and ending on the last day of the nineteenth full quarter following the Closing Date, and (iii) thereafter, 10.00% per annum or, at the purchasers’ election from time to time, a floating rate equal to the applicable three-month LIBOR (or alternative rate as determined in accordance with the partnership agreement), plus 7.00% per annum.

The following table summarizes cash distributions declared on our Class D Preferred Units for the years ended March 31, 2021 and 2020:

Amount Paid to Class D

7 unchanged sentences

January 20, 2021 February 5, 2021 February 12, 2021 $ 26.01 $ 15,608

For the quarter ended March 31, 2021, we did not declare or pay distributions to the holders of the Class D Preferred Units, thus the average cumulative distribution at March 31, 2021 for each Class D Preferred Unit is $ 26.01 .

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

The current distribution rate for the Class D Preferred Units is 9.00% per year per unit (equal to $90.00 per every $1,000 in unit value per year), plus an additional 1.5% rate increase due to us exceeding the adjusted total leverage ratio and due to a Class D distribution payment default, as defined within the Amended and Restated Partnership Agreement .

For the quarter ended March 31, 2022, we did not declare or pay distributions to the holders of the Class D Preferred Units, thus the average quarterly distribution at March 31, 2022 is $ 27.32 and the average cumulative distribution since suspension for each Class D Preferred unit is $ 135.28 .

In addition, the amount of cumulative but unpaid distributions shall continue to accumulate at the then applicable rate until all unpaid distributions have been paid in full.

The total amount due as of March 31, 2022 is $ 85.4 million.

The distributions for the quarters ended September 30, 2020 and December 31, 2020 include a 1.0 % rate increase due to us exceeding the adjusted total leverage ratio, as defined within the Amended and Restated Partnership Agreement.

3 unchanged sentences

In accordance with the terms of our Amended and Restated Partnership Agreement, the value of each Class D Preferred Unit automatically increased by the non-cash accretion, which was approximately $ 17.4 million in the aggregate with respect to the distributions for the year ended March 31, 2020.

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

At any time after the Closing Date, the Partnership shall have the right to redeem all of the outstanding Class D Preferred Units at a price per Class D Preferred Unit equal to the sum of the then-unpaid accumulations with respect to such Class D Preferred Unit and the greater of either the applicable multiple on invested capital or the applicable redemption price based on an applicable internal rate of return, as more fully described in the Amended and Restated Partnership Agreement.

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The warrants issued in the July 2, 2019 private placement are exercisable for, in the aggregate, 17,000,000 common units, of which 10,000,000 were issued with an exercise price of $ 17.45 per common unit (the “Premium Warrants”), and the remaining warrants to purchase 7,000,000 common units were issued with an exercise price of $ 14.54 per common unit (the “Par Warrants”).

The warrants issued in the October 31, 2019 private placement are exercisable for, in the aggregate, 8,500,000 common units, of which, 5,000,000 were issued with an exercise price of $ 16.28 per common unit, and the remaining warrants to purchase 3,500,000 common units were issued with an exercise price of $ 13.56 per common unit.

The warrants issued in the October 31, 2019 private placement are exercisable for, in the aggregate, 8,500,000 common units, of which, 5,000,000 (which are considered Premium Warrants) were issued with an exercise price of $ 16.28 per common unit, and the remaining warrants to purchase 3,500,000 (which are considered Par Warrants) common units were issued with an exercise price of $ 13.56 per common unit.

The warrants may be exercised from and after the first anniversary of the date of issuance.

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In connection with the issuance of the Class D Preferred Units, we entered into a board rights agreement pursuant to which affiliates of the purchasers of the Class D Preferred Units (“Purchasers”) will have the right to designate one director on the board of directors of our general partner, so long as the Purchasers and their respective affiliates, in the aggregate, own either at least (i) (A) 50% of the number of Class D Preferred Units issued on the Closing Date or (B) 50% of the aggregate liquidation preference of any class or series of Class D Parity Securities (as defined in the Amended and Restated Partnership Agreement), or (ii) warrants and/or common units that, in the aggregate, comprise 10% or more of the then-outstanding common units.

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

Amended and Restated Partnership Agreement

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The Class D Preferred Units have no stated maturity, but we may redeem the Class D Preferred Units at any time after the Closing Date or upon the occurrence of a change in control.

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

On April 2, 2019, NGL Energy Holdings LLC executed the Fifth Amended and Restated Agreement of Limited Partnership.

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Equity-Based Incentive Compensation

Our general partner has adopted a long-term incentive plan (“LTIP”), which allows for the issuance of equity-based compensation.

Our general partner has granted certain restricted units to employees and directors, which vest in tranches, subject to the continued service of the recipients through the vesting date (the “Service Awards”).

The awards may also vest upon a change of control, at the discretion of the board of directors of our general partner.

Our general partner has adopted a long-term incentive plan (“LTIP”), which allowed for the issuance of equity-based compensation.

Our general partner granted certain restricted units to employees and directors, which vest in tranches, subject to the continued service of the recipients through the vesting date (the “Service Awards”).

The Service Awards may also vest upon a change of control, at the discretion of the board of directors of our general partner.

No distributions accrue to or are paid on the Service Awards during the vesting period.

The following table summarizes the Service Award activity during the years ended March 31, 2021, 2020 and 2019:

Unvested Service Award units at March 31, 2018 2,278,875

Units granted 3,141,993

Units vested and issued ( 2,833,968 )

Units forfeited ( 278,500 )

Unvested Service Award units at March 31, 2019 2,308,400

Units granted 2,211,431

Units vested and issued ( 2,938,481 )

Units forfeited ( 209,925 )

The LTIP expired on May 10, 2021.

The following table summarizes the Service Award activity during the year ended March 31, 2022:

Weighted-Average

Number of Fair Value

Units Per Unit

Unvested Service Award units at March 31, 2021 446,975 $ 6.61

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Unvested Service Award units at March 31, 2022 2,188,800 $ 2.15

The weighted-average grant prices for March 31, 2021, 2020 and 2019 were $ 3.76 , $ 12.84 and $ 9.74 , respectively.

In connection with the vesting of certain restricted units during the year ended March 31, 2021, we canceled 70,226 of the newly-vested common units in satisfaction of $ 0.2 million of employee tax liability paid by us.

Pursuant to the terms of the LTIP, these canceled units are available for future grants under the LTIP.

As of March 31, 2021, we had 446,975 unvested Service Award units which will vest during the year ended March 31, 2022.

The weighted-average grant prices for the years ended March 31, 2022, 2021 and 2020 were $ 2.15 , $ 3.76 and $ 12.84 , respectively.

In connection with the vesting of certain Service Award units during the year ended March 31, 2022, we canceled 44,769 of the newly-vested common units in satisfaction of $ 0.1 million of employee tax liability paid by us.

Pursuant to the expiration of the LTIP discussed below, those canceled units are not available for future grants.

As of March 31, 2022, there are 1,459,075 unvested Service Award units which are expected to vest during the year ended March 31, 2023 and 729,725 unvested Service Award units which are expected to vest during the year ended March 31, 2024.

Service Awards are valued at the average of the high/low sales price as of the grant date less the present value of the expected distribution stream over the vesting period using a risk-free interest rate.

We record the expense for each Service Award on a straight-line basis over the requisite period for the entire award (that is, over the requisite service period of the last

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

separately vesting portion of the award), ensuring that the amount of compensation cost recognized at any date at least equals the portion of the grant-date value of the award that is vested at that date.

We record the expense for each Service Award on a straight-line basis over the requisite period for the entire award (that is, over the requisite service period of the last separately vesting portion of the award), ensuring that the amount of compensation cost recognized at any date at least equals the portion of the grant date value of the award that is vested at that date.

During the years ended March 31, 2022, 2021 and 2020, we recorded compensation expense related to Service Award units of $ 3.3 million, $ 4.7 million and $ 8.5 million, respectively.

During the year ended March 31, 2021, no units were granted as performance bonuses.

Of the restricted units granted and vested during the years ended March 31, 2020 and 2019, 1,886,131 and 1,922,618 units, respectively, were granted for performance bonuses.

The total amount of the bonus payment for the year ended March 31, 2020 was $ 24.5 million, of which we had accrued $ 8.7 million as of March 31, 2019.

During the years ended March 31, 2022 and 2021, no Service Award units were granted as performance bonuses.

Of the Service Award units granted and vested during the year ended March 31, 2020, 1,886,131 units were granted for performance bonuses.

The total amount of the bonus payment for the year ended March 31, 2020 was $ 24.5 million, of which we had accrued $ 8.7 million as of March 31, 2019.

As of March 31, 2021, we had estimated future expense of $ 1.7 million on unvested Service Award units which we expect to record during the year ended March 31, 2022.

Beginning in April 2015, our general partner granted units to certain employees that vest contingent both on the continued service of the recipients through the vesting date and also on the performance of our common units relative to other entities in the Alerian MLP Index (the “Index”) over specified periods of time (the “Performance Awards”).

Performance was to be calculated based on the return on our common units (including changes in the market price of the common units and distributions paid during the performance period) relative to the returns on the common units of the other entities in the Index.

During the three months ended December 31, 2018, the compensation committee of the board of directors of our general partner terminated the Performance Award plan and all unvested outstanding Performance Award units were canceled.

Accordingly, as no replacement awards were granted, all previously unrecognized compensation cost was expensed as of the cancellation date.

During the year ended March 31, 2019, we recorded compensation expense related to the cancellation of the Performance Award units of $ 3.1 million which was recorded within general and administrative expense in our consolidated statement of operations for the year ended March 31, 2019.

The following table summarizes the Performance Award activity during the year ended March 31, 2019:

Unvested Performance Award units at March 31, 2018 917,000

Units forfeited ( 445,500 )

Units canceled ( 471,500 )

Unvested Performance Award units at March 31, 2019 —

During the July 1, 2015 through June 30, 2018 performance period, the return on our common units was below the return of the 50th percentile of our peer companies in the Index.

As a result, no Performance Award units vested on July 1, 2018 and Performance Award units with the July 1, 2018 vesting date are considered to be forfeited.

The fair value of the Performance Awards was estimated using a Monte Carlo simulation at the grant date.

The significant inputs used to calculate the fair value of these awards include (i) the price per our common units at the grant date and the beginning of the performance period, (ii) a compounded risk-free interest rate, (iii) our compounded dividend yield, (iv) our historical volatility, (v) the volatility and correlations of our peers and (vi) the remaining performance period.

We recorded the expense on a straight-line basis over the period beginning with the grant date and ending with the vesting date of the tranche.

During the year ended March 31, 2019, we recorded compensation expense related to Performance Award units of $ 4.9 million (including amounts recorded related to the cancellation of the Performance Award plan (see above)).

As of March 31, 2021, there are approximately 3.3 million common units remaining available for issuance under the LTIP.

Prior to the expiration of the LTIP on May 10, 2021, we granted approximately 3.3 million common units as Service Awards, which will vest in our 2022 and 2023 fiscal years.

Due to the LTIP expiring, we have no common units available for grant and any current unvested Service Awards that are forfeited, canceled or expire will not be available for future grants.

Note 11— Fair Value of Financial Instruments

Our cash and cash equivalents, accounts receivable, accounts payable, accrued expenses, and other current assets and liabilities (excluding derivative instruments) are carried at amounts which reasonably approximate their fair values due to their short-term nature.

As of March 31, 2022, we had estimated future expense of $ 3.1 million on unvested Service Award units which we expect to record during the year ended March 31, 2023 and $ 1.3 million which we expect to record during the year ended March 31, 2024.

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

As the LTIP expired on May 10, 2021, we have no common units available for grant and any current unvested Service Awards that are forfeited or canceled will not be available for future grants.

Note 10— Fair Value of Financial Instruments

Commodity Derivatives

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Netting of counterparty contracts (1) ( 47,585 ) 47,585 ( 12,648 ) 12,648

Net cash collateral provided (held) 2,660 5,543 ( 50,104 ) ( 370 )

Net cash collateral provided 839 — 2,660 5,543

Commodity derivatives $ 78,575 $ ( 27,372 ) $ 39,844 $ ( 24,140 )

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Net commodity derivative asset $ 51,203 $ 15,704

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Notes to Consolidated Financial Statements (Continued)

The following table summarizes our open commodity derivative contract positions at the dates indicated.

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Propane fixed-price (1) April 2022–December 2023 184 3,785

Refined products fixed-price (1) April 2021–January 2022 ( 503 ) 1,928

Butane fixed-price (1) April 2021–March 2022 ( 753 ) ( 3,764 )

Other April 2021–June 2022 12,563

Refined products fixed-price (1) April 2022–December 2022 685 ( 6,063 )

Butane fixed-price (1) April 2022–December 2023 ( 268 ) ( 1,711 )

Other April 2022–March 2023 18,691

Net cash collateral provided 839

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Refined products fixed-price (1) April 2021–January 2022 ( 503 ) 1,928

Other April 2020–March 2022 1,000

Net cash collateral held ( 50,474 )

Butane fixed-price (1) April 2021–March 2022 ( 753 ) ( 3,764 )

Other April 2021–June 2022 12,563

Net cash collateral provided 8,203

Net commodity derivative asset $ 15,704

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

(1) We may have fixed price physical purchases, including inventory, offset by floating price physical sales or floating price physical purchases offset by fixed price physical sales.

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2020 $ 85,941

Amounts in the table above do not include net (losses) gains from our commodity derivatives related to Mid-Con, Gas Blending, TPSL and our former Retail Propane segment, as these amounts have been classified as discontinued operations within our consolidated statements of operations for all periods presented (see Note 19).

Amounts in the table above do not include net (losses) gains from our commodity derivatives related to Mid-Con, Gas Blending and TPSL as these amounts have been classified as discontinued operations within our consolidated statements of operations for the years ended March 31, 2021 and 2020 (see Note 18).

We have credit policies that we believe minimize our overall credit risk, including an evaluation of potential counterparties’ financial condition (including credit ratings), collateral requirements under certain circumstances, and the use of industry standard master netting agreements, which allow for offsetting counterparty receivable and payable balances for certain transactions.

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If a counterparty does not perform on a contract, we may not realize amounts that have been recorded in our consolidated balance sheets and recognized in our net income.

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Notes to Consolidated Financial Statements (Continued)

Interest Rate Risk

The ABL Facility is variable-rate debt with interest rates that are generally indexed to the Wall Street Journal prime rate or LIBOR interest rate (or successor rate).

The ABL Facility is variable-rate debt with interest rates that are generally indexed to the Wall Street Journal prime rate or LIBOR interest rate (or successor rate, which has since been determined to be SOFR).

At March 31, 2022, we had $ 116.0 million of outstanding borrowings under the ABL Facility at a weighted average interest rate of 4.64 %.

The Sawtooth credit agreement is variable-rate debt with interest rates that are generally indexed to the rate the lender announces from time to time as its prime rate or base commercial lending rate or LIBOR interest rate (or successor rate).

At March 31, 2021, we had $ 5.0 million of outstanding borrowings under the Sawtooth credit agreement at an average interest rate of 2.36 %.

In addition, on and after certain dates, distributions for our Class B Preferred Units and Class C Preferred Units will be calculated using the applicable three-month LIBOR interest rate (or alternative rate as determined in accordance with the partnership agreement) plus a spread (see Note 9 for a further discussion).

Fair Value of Fixed-Rate Notes

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Note 11— Segments

Our operations are organized into three reportable segments:

(i) Water Solutions, (ii) Crude Oil Logistics and (iii) Liquids Logistics, consistent with the manner in which our chief operating decision maker evaluates performance and allocates resources.

These segments have been identified based on the differing products and services, regulatory environment and the expertise required for these operations.

Our Liquids Logistics reportable segment includes operating segments that have been aggregated based on the nature of the products and services provided.

Operating income of these segments is reviewed by the chief operating decision maker to evaluate performance and make business decisions.

Intersegment transactions are recorded based on prices negotiated between the segments and are eliminated upon consolidation.

See Note 1 for a discussion of the products and services of our reportable segments.

The remainder of our business operations is presented as “Corporate and Other” and consists of certain corporate expenses that are not allocated to the reportable segments.

The following table summarizes revenues related to our segments for the periods indicated:

During the three months ended March 31, 2021, we changed the name of our Liquids and Refined Products segment to Liquids Logistics.

Transactions between segments are recorded based on prices negotiated between the segments.

The “Corporate and Other” category in the table below includes certain corporate expenses that are not allocated to the reportable segments.

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

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Sale of recovered crude oil 77,203 28,599 59,445

Sale of brackish non-potable water 10,554 11,676 2,404

Sale of water 39,518 13,569 12,381

Other service revenues 18,597 11,178 19,356

Non-Topic 606 revenues — — 42

Total Water Solutions revenues 544,866 370,986 422,059

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Corporate and Other 23,914 18,469 13,936

Total depreciation and amortization $ 331,200 $ 276,848 $ 221,674

Total $ 306,208 $ 331,200 $ 276,848

Operating Income (Loss):

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Corporate and Other ( 48,400 ) ( 64,144 ) ( 90,447 )

Total operating (loss) income $ ( 390,753 ) $ ( 3,332 ) $ 126,728

Total $ 83,043 $ ( 390,753 ) $ ( 3,332 )

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

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This information has been prepared on the accrual basis, and includes property, plant and equipment and intangible assets acquired in acquisitions.

This information below does not include goodwill by segment.

Year Ended March 31,

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Total $ 135,022 $ 119,707 $ 2,133,415

All of the tables above do not include amounts related to Mid-Con, Gas Blending, TPSL and our former Retail Propane segment, as these amounts have been classified as discontinued operations within our consolidated statements of operations for all periods presented (see Note 19).

All of the tables above do not include amounts related to Mid-Con, Gas Blending and TPSL, as these amounts have been classified as discontinued operations within our consolidated statements of operations for the years ended March 31, 2021 and 2020 (see Note 18).

The following tables summarize long-lived assets (consisting of property, plant and equipment, intangible assets, operating lease right-of-use assets and goodwill) and total assets by segment at the dates indicated:

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(1) Includes $ 40.2 million and $ 37.9 million of non-US total assets at March 31, 2022 and 2021, respectively.

Note 13— Transactions with Affiliates

A member of the board of directors of our general partner was an executive officer of WPX Energy, Inc.

We also treat and dispose of produced water and solids received from WPX.

On January 7, 2021, Devon Energy Corporation (“Devon”) acquired WPX and the member of the board of directors of our general partner has since retired from WPX/Devon.

Due to his retirement, we will no longer be classifying transactions with WPX or Devon as related party transactions after December 31, 2020.

SemGroup Corporation (“SemGroup”) holds ownership interests in our general partner.

We sell product to and purchase product from SemGroup, and these transactions are included within revenues and cost of sales, respectively, in our consolidated statements of operations.

In December 2019, Energy Transfer LP (“ET”) acquired SemGroup.

During the three months ended December 31, 2019, we reevaluated our related parties and determined that SemGroup/ET no longer meet the criteria to be disclosed as a related party.

For the tables below, information for the year ended March 31, 2019 and six months

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Notes to Consolidated Financial Statements (Continued)

ended September 30, 2019 have been retained but we have not disclosed any information related to transactions subsequent to September 30, 2019.

Note 12— Transactions with Affiliates

The following table summarizes our related party transactions for the periods indicated:

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(in thousands)

Sales to WPX $ 39,129 $ 48,222 $ 28,026

Purchases from WPX (1) $ 216,487 $ 313,578 $ 329,525

Sales to SemGroup $ 458 $ 1,114

Purchases from SemGroup $ — $ 4,395

Sales to entities affiliated with management $ — $ 18,402 $ 8,367

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Purchases from equity method investees $ 1,091 $ 3,249 $ 2,120

(1) Amount primarily relates to purchases of crude oil under the definitive agreement we signed with WPX, as discussed further below.

Sales to WPX (1) $ 39,129 $ 48,222

Purchases from WPX (1) $ 216,487 $ 313,578

Sales to SemGroup (2) $ 458

(1) As previously disclosed, a member of the board of directors of our general partner was an executive officer of WPX Energy, Inc.

(“WPX”) and has subsequently retired.

Therefore, we are no longer classifying transactions with WPX as a related party.

The prior year amounts relate to purchases and sales of crude oil with WPX as well as the treatment and disposal of produced water and solids received from WPX.

(2) As previously disclosed, SemGroup Corporation (“SemGroup”), who holds ownership interests in our general partner, was acquired by Energy Transfer LP (“ET”) in December 2019.

During the three months ended December 31, 2019, we reevaluated our related parties and determined that SemGroup/ET no longer meet the criteria to be disclosed as a related party.

Therefore, information for the six months ended September 30, 2019 has been retained but we have not disclosed any information related to transactions subsequent to September 30, 2019.

Accounts receivable from affiliates consist of the following at the dates indicated:

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NGL Energy Holdings LLC $ 8,483 $ 8,245

Entities affiliated with management 728 151

Equity method investees 107 462

Entities affiliated with management 1 728

Total $ 8,591 $ 9,435

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(in thousands)

WPX $ — $ 17,039

Entities affiliated with management 12 149

Equity method investees $ 27 $ 107

Entities affiliated with management 46 12

Total $ 73 $ 119

Other Related Party Transactions

Guarantee of Outstanding Loan for KAIR2014 LLC (“KAIR2014”)

In connection with the purchase of our 50 % interest in an aircraft company, KAIR2014, discussed below, we executed a joint and several guarantee for the benefit of the lender for KAIR2014’s outstanding loan.

The other owner of KAIR2014, our Chief Executive Officer, H.

Michael Krimbill, is a party to a similar guarantee.

This guarantee obligates us for the payment and performance of KAIR2014 with respect to the repayment of the loan.

As of March 31, 2022, the outstanding balance of the loan is approximately $ 2.5 million.

Payments are made monthly, reducing the outstanding balance, and the loan matures in September 2023.

As the guarantee is joint and several, we could be liable for the entire outstanding balance of the loan.

The loan is collateralized by the airplane owned by KAIR2014 and in the event of a default, the lender could seek payment in full from us.

As of March 31, 2022, no accrual has been recorded related to this guarantee.

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Notes to Consolidated Financial Statements (Continued)

During the three months ended June 30, 2019, we purchased a 50 % interest in KAIR2014 for $ 0.9 million in cash and accounted for our interest using the equity method of accounting (see Note 2).

The remaining interest in KAIR2014 is owned by our Chief Executive Officer, H.

Michael Krimbill.

2026 Senior Secured Notes and ABL Facility

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For their consent, we paid to the holders of the Class D Preferred Units $ 40.0 million.

Acquisition of Interest in KAIR2014 LLC

During the three months ended June 30, 2019, we purchased a 50 % interest in an aircraft company, KAIR2014 LLC, for $ 0.9 million in cash and accounted for our interest using the equity method of accounting (see Note 2).

The remaining interest in KAIR2014 LLC is owned by our Chief Executive Officer, H.

Michael Krimbill.

Acquisition of Interest in NGL Energy Holdings LLC

During the year ended March 31, 2020, we purchased, in three transactions, a 2.97 % interest in our general partner, NGL Energy Holdings LLC, for $ 3.8 million in cash and accounted for this as a deduction within limited partners’ equity in our

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

consolidated balance sheet.

We also purchased a 5.73 % interest in our general partner, NGL Energy Holdings LLC, for $ 11.5 million in cash and accounted for this as a deduction within limited partners’ equity in our consolidated balance sheet.

This interest was purchased from a fund controlled by The Energy & Minerals Group, which is represented on the board of directors of our general partner.

Victory Propane, LLC

On August 14, 2018, we sold our 50 % interest in Victory Propane, LLC (“Victory Propane”) to Victory Propane, LLC.

As consideration, we received a promissory note in the amount of $ 3.4 million, which encompassed the purchase price for our 50 % interest plus the outstanding balance of the loan receivable of $ 2.6 million as of the date of the transaction.

The promissory note bears no interest and matures on July 31, 2023.

We discounted the promissory note to its net present value of $ 2.6 million, with the amount of the reduction in the value of the promissory note recorded as a loss within loss on disposal or impairment of assets, net in our consolidated statement of operations.

This was the final transaction in exiting the retail propane business and was considered to be inconsequential by management.

As a result of the sale, Victory Propane is no longer considered a related party.

Agreement with WPX

During the three months ended June 30, 2018, we entered into a definitive agreement with WPX.

Under this agreement, we agreed to provide WPX the benefit of our minimum shipping fees or deficiency credits (fees paid in previous periods that were in excess of the volumes actually shipped) totaling $ 67.7 million at the time of the transaction (as discussed further in Note 2), which can be utilized for volumes shipped that exceed the minimum monthly volume commitment in subsequent periods.

As a result, we wrote-off these minimum shipping fees previously included within other noncurrent assets in our consolidated balance sheet (see Note 2) and recorded a loss within loss on disposal or impairment of assets, net.

We also agreed that we would only ship crude oil that we are required to purchase from WPX in utilizing our allotted capacity on these pipelines and they agreed to be fully responsible to us for all deficiency payments (money due when our actual shipments are less than our allotted capacity) for the remaining term of our contract, which totaled $ 50.3 million at June 30, 2018 (as discussed further in Note 9).

As consideration for this transaction, we paid WPX a net $ 35.3 million, which was recorded as a loss within loss on disposal or impairment of assets, net.

Repurchase of Warrants

On April 26, 2018, we repurchased outstanding warrants, as discussed further in Note 10, from funds managed by Oaktree, who were represented on the board of directors of our general partner (see Note 10).

Note 13— Employee Benefit Plan

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For every dollar that employees contribute up to 1% of their eligible compensation (as defined in the plan), we contribute one dollar, plus 50 cents for every dollar employees contribute between 1% and 6% of their eligible compensation (as defined in the plan).

Our matching contributions vest over two years.

Our matching contributions vest over an employee’s first two years of employment, subject to a participant’s continued service.

Effective January 1, 2020, for every dollar that employees contribute up to 4% of their eligible compensation (as defined in the plan), we contribute one dollar, plus 50 cents for every dollar employees contribute between 4% and 6% of their eligible compensation (as defined in the plan).

Expenses under the plan for the years ended March 31, 2021, 2020 and 2019 were $ 3.4 million, $ 2.3 million and $ 1.9 million, respectively.

Expenses for matching contributions related to Mid-Con, Gas Blending, TPSL and our former Retail Propane segment have been classified as discontinued operations within our consolidated statements of operations for all periods presented (see Note 19).

Expenses under the plan for the years ended March 31, 2022, 2021 and 2020 were $ 3.9 million, $ 3.4 million and $ 2.3 million, respectively, and do not include expenses for matching contributions related to Mid-Con, Gas Blending and TPSL which have been classified as discontinued operations within our consolidated statements of operations for the years ended March 31, 2021 and 2020 (see Note 18).

Note 14— Revenue from Contracts with Customers

Effective April 1, 2018, we recognize revenue for services and products under revenue contracts as our obligations to either perform services or deliver or sell products under the contracts are satisfied.

We recognize revenue for services and products under revenue contracts as our obligations to either perform services or deliver or sell products under the contracts are satisfied.

A performance obligation is a promise in a contract to transfer a distinct good or service to the customer.

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Our revenue contracts in scope under ASC 606 primarily have a single performance obligation.

The evaluation of when performance obligations have been satisfied and the transaction price that is allocated to our performance obligations requires significant judgment and assumptions, including our evaluation of the timing of when control of the underlying good or service has transferred to our customers and the relative stand-alone selling price of goods and services provided to customers under

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Notes to Consolidated Financial Statements (Continued)

contracts with multiple performance obligations.

Actual results can vary from those judgments and assumptions.

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The primary purpose of our invoicing terms is to allow customers to secure the right to reserve the product or storage capacity to be received or used at a later date, not to receive financing from our customers or to provide customers with financing.

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Notes to Consolidated Financial Statements (Continued)

We report taxes collected from customers and remitted to taxing authorities, such as sales and use taxes, on a net basis.

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For all of our disposal contracts within the Water Solutions segment, revenue will be recognized over time utilizing the output method based on the volume of produced water or solids we accept from the customer.

For contracts that involve the sale of recovered crude oil and brackish non-potable water, we will recognize revenue at a point in time, based on when control of the product is transferred to the customer.

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Notes to Consolidated Financial Statements (Continued)

For contracts that involve the sale of recovered crude oil and reuse, recycled and brackish non-potable water, we will recognize revenue at a point in time, based on when control of the product is transferred to the customer.

Crude Oil Logistics Performance Obligations

Within the Crude Oil Logistics segment, revenue is disaggregated into two primary revenue streams that include revenue from the sale of commodities and service revenue.

For sales of commodities, we are obligated to deliver a predetermined amount of product on a month-to-month basis to our customers.

For these types of agreements, revenue is recognized at a point in time based on when the product is delivered and control is transferred to the customer.

For revenue received from services rendered, we are obligated to provide throughput services to move product via pipeline, truck, railcar, or marine vessel or to provide terminal maintenance services.

In either case, the obligation is satisfied over time utilizing the output method based on each volume of product that is moved from the origination point to the final destination or based on the passage of time.

For sales of commodities, we are obligated to deliver a predetermined amount of crude oil, primarily on a month-to-month basis, to our customers.

For these types of agreements, revenue is recognized at a point in time based on when the crude oil is delivered and control is transferred to the customer.

For revenue received from services rendered, we are obligated to provide throughput services to move crude oil via pipeline, truck, railcar, or marine vessel or to provide terminal maintenance services.

In either case, the obligation is satisfied over time utilizing the output method based on each volume of crude oil that is moved from the origination point to the final destination or based on the passage of time.

Liquids Logistics Performance Obligations

Within the Liquids Logistics segment, revenue is disaggregated into two primary revenue streams that include revenue from the sale of commodities and providing services.

For commodity sales, we are obligated to deliver a specified amount of product over a specified period of time.

Within the Liquids Logistics segment, revenue is disaggregated into two primary revenue streams that include revenue from the sale of commodities and service revenue.

For sales of commodities, we are obligated to deliver a specified amount of

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

product over a specified period of time.

For these types of agreements, revenue is recognized at a point in time based on when the product is delivered and control is transferred to the customer.

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Most of our service contracts are such that we have the right to consideration from a customer in an amount that corresponds directly with the value to the customer of our performance completed to date.

Therefore, we are utilizing the practical expedient in ASC 606-10-55-18 under which we recognize revenue in the amount to which we have the right to invoice.

Therefore, we utilized the practical expedient in ASC 606-10-55-18 under which we recognize revenue in the amount to which we have the right to invoice.

Applying this practical expedient, we are not required to disclose the transaction price allocated to remaining performance obligations under these agreements.

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Accounts receivable from contracts with customers are presented within accounts receivable-trade and accounts receivable-affiliates in our consolidated balance sheets.

Our contract asset balances primarily relate to our underground cavern storage contracts with multi-period contracts in which

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

the fee escalates each year and the customer provides upfront payment at the beginning of the contract period.

We did not record any contract assets during this period.

We did not record any contract assets during the year ended March 31, 2022.

Under certain of our contracts we may be entitled to receive payments in advance of satisfying our performance obligations under the contract.

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Some revenue contracts contain prepayment provisions within our Liquids Logistics segment.

Revenue received related to our underground cavern storage services is received upfront at the beginning of the contract period and is deferred until services have been rendered.

In some cases, we also receive prepayments from customers purchasing commodities, which allows the customer to secure the right to receive their requested volumes in a future period.

3 unchanged sentences

As the actual amount billed and received from the customer differs from the amount of revenue recognized, a contract liability is recorded.

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

• Tiered pricing and volume discount pricing.

12 unchanged sentences

Payment recognized in revenue ( 44,019 )

Disposition of Sawtooth (see Note 17) ( 8,234 )

Contract liabilities balance at March 31, 2022 $ 7,667

Note 15— Leases

We adopted ASC 842 effective April 1, 2019 using the modified retrospective method, with no adjustment to comparative period information, which remains reported under ASC 840, and no cumulative effect adjustment to equity.

We adopted ASC 842 effective April 1, 2019 using the modified retrospective method with no cumulative effect adjustment to equity.

Upon adoption, we recorded operating lease right-of-use assets of $ 551.2 million and operating lease obligations of $ 549.0 million, including amounts classified as assets and liabilities held for sale as of April 1, 2019.

5 unchanged sentences

and (v) not reassess initial costs.

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

Lessee Accounting

13 unchanged sentences

We have variable lease payments, including adjustments to lease payments based on an index or rate, such as a consumer price index, fair value adjustments to lease payments, and common area maintenance, real estate taxes, and insurance payments in certain real estate leases.

We also have certain land leas es within our Water Solutions segment that require us to pay a royalty, which could be based on a flat rate per barrel disposed or a percentage of revenue generated.

We also have certain land leas es within our Water Solutions segment that require us to pay a royalty, which could be

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

based on a flat rate per barrel disposed or a percentage of revenue generated.

Variable lease payments are excluded from operating lease right-of-use assets and operating lease liabilities and are expensed as incurred.

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Short-term leases with an initial term of 12 months or less that do not include a purchase option, with the exception of railcar leases, are not recorded on the consolidated balance sheet.

Operating lease expense for short-term leases is recognized on a straight-line basis over the lease term and amounts related to short-term leases are disclosed within our consolidated financial statements.

Operating lease expense for short-term leases is recognized on a straight-line basis over the lease term and is disclosed below.

We have lease agreements with lease and non-lease components, which are generally accounted for separately.

6 unchanged sentences

Year Ended March 31,

2022 2021 2020

(in thousands)

2 unchanged sentences

Short-term lease expense 351 1,217 799

Total lease expense $ 89,119 $ 92,297

Amounts in the table above do not include lease expense related to TPSL and Gas Blending, as these amounts have been classified within discontinued operations within our consolidated statement of operations for all periods presented (see Note 19).

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

Rental expense relating to operating leases was $ 91.6 million for the year ended March 31, 2019, which does not include rental expense related to Mid-Con, Gas Blending, TPSL and our former Retail Propane segment, as these amounts have been classified within discontinued operations in our consolidated statements of operations for all periods presented (see Note 19).

Total $ 81,016 $ 89,119 $ 92,297

The following table summarizes maturities of our operating lease obligations at March 31, 2022 (in thousands):

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(1) Amounts include the leases and activity for TPSL and Gas Blending which were sold during the year ended March 31, 2020 (see Note 18).

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

Lessor Accounting and Subleases

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Fixed rental revenue is recognized on a straight-line basis over the lease term.

During the years ended March 31, 2021 and 2020, fixed rental revenue was $ 15.9 million and $ 20.4 million, which includes $ 2.5 million and $ 4.6 million of sublease revenue, respectively.

During the years ended March 31, 2022, 2021 and 2020, fixed rental revenue was $ 14.4 million, $ 15.9 million and $ 20.4 million, which includes $ 1.4 million, $ 2.5 million and $ 4.6 million of sublease revenue, respectively.

The following table summarizes future minimum lease payments receivable under various noncancelable operating lease agreements at March 31, 2022 (in thousands):

Year Ending March 31,

2022 $ 11,944

Thereafter 423

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The valuation allowance considers the risk of loss, even if remote, and considers past events, current conditions and reasonable and supportable forecasts.

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

We are exposed to credit losses primarily through sale of products and services and notes receivable from third-parties.

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Cumulative effect adjustment — 433 —

Current period provision for expected credit losses 319 1,202 381

Write-offs charged against the allowance ( 3,100 ) ( 678 ) ( 216 )

Change in provision for expected credit losses 929 319 1,202

Write-offs charged against the provision ( 491 ) ( 3,100 ) ( 678 )

Disposition of Sawtooth (See Note 17) ( 4 ) — —

Balance at end of year $ 2,626 $ 2,192 $ 4,540

(1) We adopted ASU No.

2016-13 as of April 1, 2020.

The allowance reported for the years ended March 31, 2020 and 2019 has not been changed from its previous presentation.

The following table summarizes changes in our expected credit loss allowance for notes receivable and other for the period indicated:

March 31, 2021 (1)

(1) We adopted ASU 2016-13 as of April 1, 2020.

The allowance reported for the year ended March 31, 2020 has not been changed from its previous presentation.

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

The following table summarizes changes in our expected credit loss allowance for notes receivable and other for the periods indicated:

Year Ended March 31,

2022 2021 (1)

(in thousands)

1 unchanged sentence

Cumulative effect adjustment — 680

Write-offs charged against the allowance ( 222 )

Write-offs charged against the provision — ( 222 )

Balance at end of year $ 458 $ 458

(1) We adopted ASU No.

2016-13 as of April 1, 2020.

An allowance had not been established for notes receivable and other prior to the adoption of ASU No.

(1) We adopted ASU 2016-13 as of April 1, 2020.

An allowance had not been established for notes receivable and other prior to the adoption of ASU 2016-13.

In addition to the provision for expected credit losses above, we also wrote off $ 5.7 million during the year ended March 31, 2021 as discussed in Note 17.

Note 17— Other Matters

Sale of Sawtooth

On June 18, 2021, we sold our approximately 71.5 % interest in Sawtooth to a group of buyers for total consideration of $ 70.0 million less expenses of approximately $ 2.0 million.

We recorded a loss of $ 60.1 million within loss on disposal or impairment of assets, net in our consolidated statement of operations for the year ended March 31, 2022 .

As this sale transaction did not represent a strategic shift that will have a major effect on our operations or financial results, operations related to this portion of our Liquids Logistics segment have not been classified as discontinued operations.

Third-party Loan Receivable

As discussed previously in Note 2, we had an outstanding loan receivable of $ 26.7 million, including accrued interest, associated with our interest in the Facility that is utilized by a third party.

As previously disclosed, we had an outstanding loan receivable of $ 26.7 million, including accrued interest, associated with our interest in a natural gas liquids loading/unloading facility (the “Facility”) that was utilized by a third party.

Our loan receivable was secured by title to and a lien interest on the Facility.

The third party filed a petition for bankruptcy under Chapter 11 of the bankruptcy code in July 2019, at which time we filed our Proof of Claim within the bankruptcy case.

The Chapter 11 plan, as supplemented, was approved by the bankruptcy court in February 2020, pursuant to which we were expected to be paid a $ 26.7 million secured claim as an unimpaired creditor.

After the approval of the supplemental plan, the third party attempted to negotiate with us to accept an amount less than the full amount of our claim or to take back the Facility in kind.

In May 2020, we filed a motion with the bankruptcy court to compel the third party to pay us the full amount of the claim in accordance with the approved plan.

The bankruptcy court ruled in May 2020 that the third party would need to either pay us the full amount of the claim or deliver the Facility to us at a destination of our reasonable choosing.

On June 26, 2020, we settled our claim with the third party and agreed to receive $ 16.3 million, for which we released any and all claims and/or liens with respect to the Facility and transferred title of the Facility to the third party.

For the remaining $ 10.4 million of the loan receivable, we have filed an unsecured claim

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

within the bankruptcy.

For the remaining $ 10.4 million of the loan receivable, we filed an unsecured claim within the bankruptcy.

As of June 30, 2020, we wrote-off approximately $ 9.4 million, the portion of the unsecured claimed we have deemed uncollectible, and this amount was recorded as a loss within loss (gain) on disposal or impairment of assets, net in our unaudited condensed consolidated statement of operations.

1 unchanged sentence

Third-party Bankruptcy

During the three months ended June 30, 2020, Extraction, who is a significant shipper on our crude oil pipeline, filed a petition for bankruptcy under Chapter 11 of the bankruptcy code.

Extraction has transportation contracts pursuant to which it has committed to ship crude oil on our pipeline through October 2026.

As part of the bankruptcy filing, Extraction requested that the court authorize it to reject these transportation contracts, effective June 14, 2020.

We disputed its ability to reject the transportation contracts, filed objections and took various other legal steps within the bankruptcy proceedings to protect the value to us of the contracts at issue.

On November 2, 2020, the bankruptcy court issued a bench ruling granting Extraction’s motion to reject the transportation contracts effective as of June 14, 2020.

We disputed the rejection motion and appealed the bankruptcy court’s approval of the rejection of the transportation contracts.

As previously disclosed, during the three months ended June 30, 2020, Extraction, who is a significant shipper on our Grand Mesa pipeline, filed a petition for bankruptcy under Chapter 11 of the bankruptcy code.

Extraction had transportation contracts pursuant to which it had committed to ship crude oil on our pipeline through October 2026.

As part of the bankruptcy filing, Extraction requested that the court authorize it to reject these transportation contracts, effective June 14, 2020, and on November 2, 2020, the bankruptcy court issued a bench ruling granting Extraction’s motion to reject the transportation contracts effective as of June 14, 2020.

On December 21, 2020, we announced a global settlement agreement with Extraction, as it relates to Extraction’s emergence from bankruptcy, which occurred on January 21, 2021.

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and (iii) the receipt of $ 35.0 million from Extraction as a liquidated payment for our unsecured claims, which was received on January 21, 2021.

Due to entering into a new supply agreement and withdrawing our appeal of the rejection of our transportation contract, we determined that the customer commitment intangible asset related to one of the transportation contracts was impaired as of December 31, 2020.

We recorded an impairment charge of $ 145.8 million , which was calculated as the difference between the carrying value of the intangible asset of $ 180.8 million and the $ 35.0 million received from Extraction.

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

As a result of entering into the global settlement agreement, we determined that the customer commitment intangible asset related to one of the transportation contracts was impaired as of December 31, 2020 and recorded an impairment charge of $ 145.8 million , which was calculated as the difference between the carrying value of the intangible asset of $ 180.8 million and the $ 35.0 million received from Extraction.

We recorded the impairment charge within loss on disposal or impairment of assets, net in our consolidated statement of operations for the year ended March 31, 2021 .

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Extraction continued to utilize, during the bankruptcy period, the services under the transportation contracts by nominating and delivering barrels to be shipped on our pipeline.

During the three months ended September 30, 2020, Extraction paid us for the barrels that have actually been shipped, but did not pay for the difference between the minimum volume commitment specified under the contracts and the actual volumes shipped (“deficiency volumes”).

The amount owed by Extraction related to the deficiency volumes is $ 5.7 million.

Following our global settlement, we deemed this amount uncollectible and wrote off the entire amount to bad debt expense within our consolidated statement of operations during the year ended March 31, 2021.

Extraction also has a water disposal contract with our Water Solutions segment whereby we dispose of its produced water for a fee.

On August 10, 2020, they filed a motion with the bankruptcy court to also reject our water disposal contract but subsequently filed a motion to remove that contract from the list of contracts it was asking the court for permission to reject.

Since the filing of the bankruptcy petition, Extraction continued, and has continued after emerging from bankruptcy, to utilize the services under the water disposal contract.

We received payment for all prepetition services and they are current on all of its post-filing date receivables.

As of September 30, 2020, Extraction owed us $ 5.7 million related to deficiency volumes, which was the difference between the actual volumes shipped and the minimum volume commitment specified under the contracts.

Following our global settlement, we deemed this amount uncollectible and wrote off the entire balance to bad debt expense within our consolidated statement of operations during the year ended March 31, 2021.

Sale of Certain Assets

During the three months ended December 31, 2020, we sold certain permits, land and a saltwater disposal facility to WaterBridge Resources LLC for total proceeds of $ 43.2 million, of which $ 0.3 million remains held back until satisfaction of certain conditions.

During the three months ended December 31, 2020, we sold certain permits, land and a saltwater disposal facility to WaterBridge Resources LLC for total proceeds of $ 43.2 million.

We recorded a gain of $ 14.0 million within loss on disposal or impairment of assets, net in our consolidated statement of operations for the year ended March 31, 2021 .

Sale of South Pecos Water Disposal Business

On February 28, 2019, we completed the sale of our South Pecos water disposal business to a subsidiary of WaterBridge Resources LLC for $ 232.2 million in net cash proceeds and recorded a gain on disposal of $ 107.9 million during

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

the year ended March 31, 2019.

This gain is reported within loss on disposal or impairment of assets, net in our consolidated statement of operations.

These operations include:

(i) nine saltwater disposal facilities, (ii) all disposal agreements, commercial, surface and other contracts related to those facilities, (iii) pipelines connected to the facilities and (iv) several disposal permits.

All of the assets sold in this transaction are located near the town of Pecos, Texas in southern Reeves and Ward counties.

As part of this transaction, WaterBridge Resources LLC also has the option to acquire additional land and permits once the permitting process has been completed.

During the year ended March 31, 2020, WaterBridge Resources LLC acquired two additional permits and we received proceeds of $ 15.0 million and recorded a gain of $ 14.5 million.

This gain is reported within loss on disposal or impairment of assets, net in our consolidated statement of operations.

As this sale transaction did not represent a strategic shift that will have a major effect on our operations or financial results, operations related to this portion of our Water Solutions segment have not been classified as discontinued operations.

Sale of Bakken Saltwater Disposal Business

On November 30, 2018, we completed the sale of NGL Water Solutions Bakken, LLC to an affiliate of Tallgrass Energy, LP for $ 85.0 million in net cash proceeds and recorded a gain on disposal of $ 33.4 million during the year ended March 31, 2019 within loss on disposal or impairment of assets, net in our consolidated statement of operations.

These operations include five saltwater disposal wells located in McKenzie and Dunn Counties, North Dakota.

Sale of E Energy Adams, LLC

On May 3, 2018, we sold our approximately 20 % interest in E Energy Adams, LLC for net proceeds of $ 18.6 million and recorded a gain on disposal of $ 3.0 million during the year ended March 31, 2019 within loss on disposal or impairment of assets, net in our consolidated statement of operations.

Sawtooth Joint Venture

As previously reported, on March 30, 2018, we formed a joint venture with Magnum Liquids, LLC, a portfolio company of Haddington Ventures LLC, along with Magnum Development, LLC and other Haddington-sponsored investment entities (collectively “Magnum”) t o focus on the storage of natural gas liquids and refined products by combining our Sawtooth salt dome storage facility with Magnum’s refined products rights and adjacent leasehold.

At that time, Magnum acquired an approximately 28.5 % interest in Sawtooth from us .

Magnum had an option to acquire our remaining 71.5 % interest in Sawtooth for an additional $ 182.4 million by March 31, 2021, which was not exercised.

As part of the sale of our South Pecos water disposal business in February 2019, WaterBridge Resources LLC also had the option to acquire additional land and permits once the permitting process had been completed.

During the year ended March 31, 2020, WaterBridge Resources LLC acquired two additional permits and we received proceeds of $ 15.0 million and recorded a gain of $ 14.5 million within loss on disposal or impairment of assets, net in our consolidated statement of operations for the year ended March 31, 2020.

Note 18— Discontinued Operations

As previously disclosed, on July 10, 2018, we completed the sale of virtually all of our remaining Retail Propane segment to Superior Plus Corp.

(“Superior”) for total consideration of $ 889.8 million in cash and on August 14, 2018, we sold our interest in Victory Propane (see Note 13).

On September 30, 2019, we completed the sale of TPSL to Trajectory Acquisition Company, LLC for total consideration of $ 233.8 million , including equity consideration, inventory and net working capital.

As previously disclosed, on September 30, 2019, we completed the sale of TPSL to Trajectory Acquisition Company, LLC.

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

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

As the sale of each of these businesses represented strategic shifts, the results of operations and cash flows related to these businesses are classified as discontinued operations for all periods presented.

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

The following table summarizes the results of operations from discontinued operations for the periods indicated:

Year Ended March 31,

2021 2020 2019

(in thousands)

4 unchanged sentences

Depreciation and amortization — 749

Loss (gain) on disposal or impairment of assets, net (1) 1,174 203,990 ( 407,608 )

Operating (loss) income from discontinued operations ( 1,822 ) ( 218,237 ) 417,945

Equity in earnings of unconsolidated entities — — 1,183

Loss on disposal or impairment of assets, net (1) 1,174 203,990

Operating loss from discontinued operations ( 1,822 ) ( 218,237 )

Interest expense — ( 111 )

Other income, net — 133

(Loss) income from discontinued operations before taxes (2) ( 1,822 ) ( 218,215 ) 419,839

Loss from discontinued operations before taxes ( 1,822 ) ( 218,215 )

Income tax benefit (expense) 53 ( 20 )

(Loss) income from discontinued operations, net of tax $ ( 1,769 ) $ ( 218,235 ) $ 418,850

Loss from discontinued operations, net of tax $ ( 1,769 ) $ ( 218,235 )

(1) Amount for the year ended March 31, 2021 includes a loss of $ 1.0 million on the sale of Gas Blending and $ 0.2 million on the sale of TPSL.

Amount for the year ended March 31, 2020 includes a loss of $ 182.1 million on the sale of TPSL, a loss of $ 6.3 million on the sale of Mid-Con, a loss of $ 14.5 million on the sale of Gas Blending and a loss of $ 1.0 million on the sale of virtually all of our remaining Retail Propane segment to Superior on July 10, 2018.

Amount for the year ended March 31, 2019 includes a gain of $ 408.9 million on the sale of virtually all of our remaining Retail Propane segment to Superior on July 10, 2018, partially offset by a loss of $ 1.3 million on the sale of a portion of our Retail Propane segment to DCC LPG on March 30, 2018 related to a working capital adjustment.

(2) Amount for the year ended March 31, 2019 includes a loss attributable to redeemable noncontrolling interests of $ 0.4 million.

Continuing Involvement

As of March 31, 2021, we have commitments to sell up to 3.2 million gallons of propane, valued at $ 3.8 million (based on the contract price) to Superior and DCC, the purchasers of our former Retail Propane segment, through December 2021.

During the year ended March 31, 2021, we received a combined $ 52.3 million from Superior and DCC for propane sold to them during the period.

on July 10, 2018.

NGL ENERGY PARTNERS LP AND SUBSIDIARIES

Notes to Consolidated Financial Statements (Continued)

Note 19— Subsequent Events

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.

In addition, the sub-limit for letters of credit was increased to $ 250.0 million, and the LIBOR benchmark was replaced with the adjusted daily simple SOFR benchmark.

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 9A. Controls and Procedures